[Federal Register Volume 87, Number 101 (Wednesday, May 25, 2022)]
[Notices]
[Pages 31916-31920]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-11205]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-94950; File No. SR-OCC-2022-004]


Self-Regulatory Organizations; The Options Clearing Corporation; 
Notice of Filing of Partial Amendment No. 1 and Order Granting 
Accelerated Approval of a Proposed Rule Change, as Modified by Partial 
Amendment No. 1, by The Options Clearing Corporation Concerning 
Settlement Timing

May 19, 2022.

I. Introduction

    On March 22, 2022, the Options Clearing Corporation (``OCC'') filed 
with the Securities and Exchange Commission (``Commission'') the 
proposed rule change SR-OCC-2022-004 pursuant to Section 19(b) of the 
Securities Exchange Act of 1934 (``Exchange Act'') \1\ and Rule 3 \2\ 
thereunder. The proposed rule change would amend various provisions of 
OCC's rules to revise the required settlement time from 9:00 a.m. 
Central Time (``CT'') to 8:00 a.m. CT.\3\ The proposed rule change was 
published for public comment in the Federal Register on April 7, 
2022.\4\ On May 5, 2022, OCC filed Partial Amendment No. 1 to the 
proposed rule change.\5\ The Commission has received two comments 
regarding the proposed rule change.\6\ The Commission is publishing 
this notice to solicit comments on Partial Amendment No. 1 from 
interested persons, and is approving the proposed rule change, as 
modified by Partial Amendment No. 1, on an accelerated basis.\7\
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Notice of Filing infra note 4, 87 FR 20485.
    \4\ Securities Exchange Act Release No. 94587 (Apr. 1, 2022), 87 
FR 20485 (Apr. 7, 2022) (File No. SR-OCC-2022-004) (``Notice of 
Filing'').
    \5\ In Partial Amendment No. 1, OCC proposed conforming changes 
to its Liquidity Risk Management Framework, and appended new 
Exhibits 4 and 5D to File No. SR-OCC-2022-004 to reflect the 
proposed changes to the Liquidity Risk Management Framework.
    \6\ The Commission received two comment letters that addressed 
market conduct generally; however, additional discussion is 
unnecessary because the comment letters do not bear on the purpose 
or legal basis of the proposed rule change, as modified by Partial 
Amendment No. 1. The comments on the proposed rule change are 
available at https://www.sec.gov/comments/sr-occ-2022-004/srocc2022004.htm.
    \7\ References to the proposed rule change from this point 
forward refer to the proposed rule change as modified by Partial 
Amendment No. 1.
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II. Background <SUP>8</SUP>
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    \8\ Capitalized terms used but not defined herein have the 
meanings specified in OCC's Rules and By-Laws, available at https://www.theocc.com/about/publications/bylaws.jsp.
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    OCC collects margin deposits and Clearing Fund deposits from 
Clearing Members in order to collateralize Clearing Members' 
obligations, and thus supports OCC's abilities to act as a guarantor in 
the event a Clearing Member is unable to fulfill its obligations with 
OCC. OCC's Rules currently describe various times, many of which are 
set to 9:00 a.m. CT, for Clearing Members to make various daily 
payments for satisfying their margin and Clearing Fund obligations, 
following a specified amount of notice that OCC provides to Clearing 
Members. Such daily payments are required for Clearing Members to cover 
margin and Clearing Fund deficits, as well as increases in the Clearing 
Fund cash requirement (``Settlement Funds'').
    As described in more detail below, OCC is proposing to revise its 
By-Laws and Rules \9\ to make the following three changes to its 
settlement processes:
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    \9\ OCC is also proposing to make conforming changes to its 
Clearing Fund Methodology Policy and Liquidity Risk Management 
Framework to reflect the proposed changes to its By-Laws and Rules.

    (1) Aligning daily payment processes under a uniform start-of-
day settlement time to reduce operational complexity;
    (2) reducing the period of time a Clearing Member has to fund 
obligations arising out of OCC's routine processes for setting the 
size of its Clearing Fund to simplify OCC's financial resources 
monitoring processes; and
    (3) increasing the period of time a Clearing Member has to fund 
obligations arising out of a change to OCC's rules that affects the 
member's Clearing Fund requirement, to provide members with more 
time to consider terminating membership in response to such a rule 
change.

A. Setting a Uniform Start-of-Day Settlement Time

    OCC proposes to harmonize various daily payment processes by 
setting a uniform start-of-day settlement time (``Settlement Time''), 
as OCC believes that a uniform start-of-day settlement time would 
reduce operational complexities.\10\ In addition to setting a single 
Settlement Time, OCC proposes to consolidate various settlement 
obligations that are due at the same time into a single obligation to 
further streamline OCC's processes.
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    \10\ See Notice of Filing, supra note 4, at 20485.
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    Further, OCC intends to set the Settlement Time one hour earlier 
than the current start-of-day settlement time that applies to many of 
OCC's daily payment processes, as OCC believes that the earlier hour 
would provide OCC with additional time to address a default event and 
implement protective actions.\11\ The proposed changes would change the 
Settlement Time for various daily payment processes (described below) 
from 9 a.m. Central Time (``CT'') to 8:00 a.m. CT. The proposed rule 
change would also grant OCC discretion to extend funding deadlines when 
warranted by the circumstances, such as operational or system 
difficulties that may arise.
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    \11\ Id.
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(1) ``Settlement Time'' Definitions
    Currently, two different definitions in OCC's By-Laws (Article I, 
Definitions; Article XV, Foreign Currency Options, Definitions) define 
the term ``settlement time'' as 9:00 a.m. CT (10:00 a.m. Eastern Time 
(``ET'')). OCC proposes to move the Article I definition to Chapter I, 
Rule 101 of OCC's Rules because the defined term does not appear 
elsewhere in the By-Laws, but appears routinely in OCC's Rules. OCC 
proposes to update both definitions to make the Settlement Time 8:00 
a.m. CT (9:00 a.m. ET). OCC further proposes to clarify in the 
relocated Rule 101 definition that the Settlement Time does not include 
settlements related to any cross-margin program with a Participating 
Carrying Clearing Organization (``CCO'').\12\
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    \12\ Current OCC Rule 706(b) allows OCC to specify the time for 
settling obligations related to cross-margin accounts with 
Participating CCOs. As of March 22, 2022, OCC maintained cross-
margin accounts with only one Participating CCO, the Chicago 
Mercantile Exchange (``CME''). See Notice of Filing, 87 FR 20485, n. 
4. OCC's Operations Manual specifies that the settlement time for 
OCC/CME cross-margin debits is 7:30 a.m. CT. See id. OCC did not 
propose changing the start-of-day settlement time for OCC/CME cross-
margin debits, which is currently 8:00 a.m. CT under Article VI, 
Section 25 of OCC's By-Laws.
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(2) Daily Margin Report
    OCC's margin-related rules define a specific time by which margin 
payments must be specified. OCC proposes to replace the time specified 
in the margin-related rules with a reference to the defined term 
``Settlement Time,'' rather than specify settlement times at multiple 
locations within OCC's rules. Rule 605 currently requires Clearing 
Members to satisfy margin deficits by 9:00 a.m. CT (10:00 a.m. ET). OCC

[[Page 31917]]

proposes to update Rule 605 to reference the defined term ``Settlement 
Time,'' so that Clearing Members must now satisfy margin deficits by 
8:00 a.m. CT (9:00 a.m. ET). Additionally, OCC Rule 605 currently 
states that prior to 9:00 a.m. CT (10:00 a.m. ET), OCC shall make 
available to each Clearing Member a Daily Margin Report for each 
account maintained by the Clearing Member. OCC proposes to update the 
Rule to require that the Daily Margin Report be made available prior to 
8:00 a.m. CT (9:00 a.m. ET).
    Interpretation and Policy .01 to Rule 605 currently provides that 
the Daily Margin Report will not include the amount of margin required 
for variance futures, and requires OCC to advise Clearing Members of 
margin requirements for variance futures by 9:00 a.m. CT (10:00 a.m. 
ET). OCC proposes to delete Interpretation and Policy .01 to Rule 605 
on the basis that margin requirements for variance futures, as for 
other products, will be included in the Daily Margin Report.
(3) General Clearing Fund Deficits
    OCC proposes to set the time for settlement of Clearing Fund-
related obligations related to general deficits \13\ by referring to 
the defined term ``Settlement Time,'' and to consolidate Clearing 
Member payment obligations due at the Settlement Time into a single 
obligation. OCC Rule 1005(a) currently requires that Clearing Members 
must satisfy general Clearing Fund deficits within one hour of being 
notified of the deficit. As a practical matter, OCC generally collects 
these deficits during the morning of each business day, but outside of 
the start-of-day settlement cycle, resulting in two separate 
collections, at similar times, from Clearing Members.
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    \13\ General deficits include deficits resulting from a decrease 
in the value of a Clearing Member's contribution or by an adjusted 
contribution pursuant to Rule 1004. OCC Rule 1004 describes how the 
required Clearing Fund contribution of a Clearing Member may be 
adjusted by the Corporation due to mergers, consolidations, position 
transfers, business expansions, membership approval, or other 
similar events in connection with the calculations made in respect 
of a particular calendar month or at any other time.
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    OCC proposes to revise its Rules to align the general Clearing Fund 
deficit collection time with the proposed Settlement Time. The proposed 
rule change would revise Rule 1005(a) to state that OCC would collect a 
general deficit arising under Rule 1005(a) at the Settlement Time, 
provided that OCC notifies the Clearing Member of such deficit at least 
one hour prior to the Settlement Time on the day the notice was 
provided. OCC typically provides notice to Clearing Members of general 
deficits under Rule 1005(a) through OCC's overnight reporting process, 
but may also issue notices in response to market conditions or 
adjustments arising from mergers, consolidations, position transfers, 
business expansions, membership approval, or other similar events. OCC 
believes that it would achieve operational efficiency by revising Rule 
1005(a) to align the general Clearing Fund deficit collection time to 
the Settlement Time.\14\ OCC intends to continue to provide Clearing 
Members with one hour to satisfy a deficit if OCC does not provide 
notice at least one hour before the Settlement Time on a particular 
day.\15\ Additionally, OCC proposes to change Rule 1005(a) to provide 
OCC with discretion to extend funding deadlines when warranted by the 
circumstances (e.g., operational or system difficulties).
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    \14\ See Notice of Filing, supra note 4, at 20486.
    \15\ Id.
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(4) Clearing Fund Replenishments and Assessments
    OCC also proposes to set the time for settlement of Clearing Fund-
related obligations related to replenishments and assessments by 
referring to the defined term ``Settlement Time.'' Rule 1006(h) 
currently requires that Clearing Members cover any charges to the 
Clearing Fund, whether in the form of replenishments or assessments, by 
9:00 a.m. CT (10:00 a.m. ET) on the following business day. OCC 
proposes to amend Rule 1006(h) to align the replenishments and 
assessments collection time with the proposed Settlement Time. OCC 
believes that using the revised ``Settlement Time'' definition, rather 
than stating a specific time in Rule 1006(h), would help to achieve 
consistency and reduce operational complexity.\16\ OCC also believes 
that a move to the earlier time of 8:00 a.m. CT would provide OCC with 
more time to address a default event and implement necessary protective 
actions, including securing funds from its liquidity providers.\17\ OCC 
also proposes to make corresponding changes to Rule 1006(h)(B), which 
reiterates that each Clearing Member shall have, and shall at all times 
maintain, the ability to make good any deficiency described in Rule 
1006(h) during a cooling-off period. OCC also proposes to amend Rule 
1006(h)(A) and Rule 1006(h)(B) to allow OCC to specify a later time for 
which Clearing Members must make good on any charges to the Clearing 
Fund.
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    \16\ Id.
    \17\ Id.
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(5) Clearing Fund Deficits Due to Rule Amendments
    Additionally, OCC proposes to set the time for settlement of 
Clearing Fund-related obligations related to changes to OCC's rules by 
referring to the defined term ``Settlement Time.'' Under current Rule 
1002(e), if a Clearing Member's Clearing Fund contribution increases 
due to an amendment of OCC's Rules, the increase shall not become 
effective until the Clearing Member is given at least two business days 
prior written notice of the amendment. Clearing Members that do not 
notify OCC that they intend to terminate their clearing membership must 
satisfy the increased contribution by 9:00 a.m. CT (10:00 a.m. ET) on 
the second business day following notification of the amendment.
    OCC proposes to revise Rule 1002(e) to align with the proposed 
Settlement Time, so that Clearing Members must satisfy the increased 
contribution by the earlier time of 8:00 a.m. CT (9:00 a.m. ET). As 
with the other proposed Settlement Time alignments, this change is 
intended to reduce operational complexity by creating a more uniform 
settlement time for Clearing Fund deficits, including those described 
in Rule 1002(e).\18\
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    \18\ See Notice of Filing, supra note 4, at 20487.
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(6) Temporary Increase in Clearing Fund Cash Requirement
    Finally, OCC proposes to set the time for settlement of Clearing 
Fund-related obligations related to increases in the Clearing Fund Cash 
Requirement by reference to the defined term ``Settlement Time.'' Under 
current Interpretation and Policy .03 to Rule 1002, Clearing Members 
must satisfy any Clearing Fund Cash Requirement-related increase in 
their required cash contributions no later than the second business day 
following notification of the increase. OCC proposes to revise Rule 
1002 Interpretation and Policy .03 to require that Clearing Members 
satisfy a required cash contribution increase by the first Settlement 
Time following notification of the increase. OCC believes that this 
proposed change would reduce operational complexity by creating a more 
uniform settlement time that aligns with the current collection period 
for other obligations to OCC.\19\
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    \19\ Id.

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[[Page 31918]]

B. Shortening Collection Period Following Clearing Fund Resizing

    In addition to harmonizing the time by which settlement occurs on a 
given day, OCC proposes to shorten the number of days a Clearing Member 
has to meet certain routine funding obligations related to the Clearing 
Fund. Currently, OCC allows members two business days to meet routine 
funding obligations. As described below, OCC is proposing changes 
designed to require funding by the next Settlement Time, effectively 
requiring funding by the business day following notice of an 
obligation. OCC stated that shortening the collection period would 
reduce operational complexity related to the monitoring of OCC's 
prefunded credit and liquidity resources by providing transparency and 
certainty to OCC around OCC's available liquidity resources during the 
resizing process.\20\
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    \20\ See Notice of Filing, supra note 4, at 20486.
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(1) Deficits From Monthly and Intra-Month Clearing Fund Resizing
    OCC Rule 1005(b) currently requires that for any deficits resulting 
from a monthly or intra-month Clearing Fund resizing, Clearing Members 
must satisfy them by 9:00 a.m. CT (10:00 a.m. ET) on the second 
business day following notification of the resizing. According to OCC, 
the two-day collection period was intended to provide Clearing Members 
with sufficient notice of any changes to their Clearing Fund 
contribution requirements. However, OCC notes that this two-day 
collection period complicates the monitoring of OCC's prefunded credit 
and liquidity resources.\21\
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    \21\ Id.
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    The proposed rule change would amend Rule 1005(b) to require that 
deficits resulting from the standard monthly Clearing Fund resizing 
must be satisfied by the Settlement Time on the first business day of 
each month. OCC believes that the proposed change would reduce the time 
to collect Clearing Fund deficits required to meet the new Clearing 
Fund size, and would reduce operational complexity of the monitoring of 
OCC's prefunded credit and liquidity resources by providing certainty 
to OCC on the available liquidity resources during the resizing 
process.\22\ The proposed rule change would also shorten the collection 
period for intra-month resizing to the next Settlement Time following 
notification of the re-sizing, which would align it with the monthly 
resizing period and other Clearing Fund deficit collection times. OCC 
also proposes to modify Rule 1005(b) so that OCC has the discretion to 
extend funding deadlines when warranted by the circumstances (e.g., 
operational or system difficulties).
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    \22\ Id.
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(2) Adjustment to Clearing Fund Contributions
    Rule 1004 provides that any deficiency arising from an adjustment 
due to a Clearing Member merger, consolidation, position transfer, 
business expansion, membership approval or other similar event shall be 
satisfied in accordance with Rule 1005(a). Rule 1004 currently provides 
an exception that allows a Clearing Member to satisfy an obligation, 
typically due on the first business day of a calendar month, on the 
second business day if the deficit coincides with a regular monthly 
sizing collection. The proposed rule change would remove this exception 
because under the proposed revision of Rule 1005, regular monthly 
sizing deficits would no longer be collected two business days after 
notification.

C. Increasing Notification Period For Clearing Fund Deficits Due to 
Rule Amendments

    In contrast to the reduction of time for funding routine 
obligations, OCC proposes increasing the number of days a Clearing 
Member has to meet Clearing Fund obligations related to changes in 
OCC's rules. Currently, OCC allows members two business days to meet 
funding obligations arising out of rule changes. As described below, 
OCC is proposing to give Clearing Members five business days notice of 
such obligations to allow Clearing Members additional time to determine 
whether to terminate clearing membership as a result of any such rule 
change.\23\
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    \23\ See Notice of Filing, supra note 4, at 20487.
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    As previously noted, under current Rule 1002(e), if a Clearing 
Member's Clearing Fund contribution increases due to an amendment of 
OCC's Rules, the increase shall not become effective until the Clearing 
Member is given at least two business days prior written notice of the 
amendment. This notification period provides Clearing Members with the 
time to notify OCC in writing that it wishes to terminate its clearing 
membership if desired, and close out or transfer its open positions 
before the effective date of the amendment. Clearing Members that do 
not notify OCC of such termination must satisfy the increased 
contribution by 9:00 a.m. CT (10:00 a.m. ET) on the second business day 
following notification of the amendment.
    The proposed rule change would increase the notification period 
from two business days to five business days, to provide Clearing 
Members with additional time to determine whether or not to terminate 
their clearing memberships and close out or transfer all open positions 
before the effective date of the amendment.\24\
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    \24\ According to OCC, the purpose of this update to Rule 
1002(e) would be to better reflect OCC's current practice, where 
Clearing Members are generally afforded more than five business 
days' notice of any change in Clearing Fund requirements that result 
from an amendment of OCC's Rules. Id. As this change codifies an 
existing practice, OCC does not believe it will modify Clearing 
Member behavior or otherwise have an adverse impact on OCC. Id.
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D. Conforming Changes to Policies

    The proposed rule change would also make conforming changes to the 
Clearing Fund Methodology Policy and Liquidity Risk Management 
Framework. These changes would amend the Clearing Fund Methodology 
Policy to reflect the revised timing for satisfying Clearing Fund Cash 
Requirement-related increases, and eliminating the policy language 
describing the exception set forth in Rule 1004 as described above. 
These changes are intended to conform the Clearing Fund Methodology 
Policy with the proposed changes to OCC's Rules and support the reduced 
operational complexity that OCC expects to achieve by creating a more 
uniform settlement time.\25\ The proposed changes to the Liquidity Risk 
Management Framework would note that Clearing Members will have until 
no later than the first start-of-day settlement time following the day 
on which notice is provided by OCC, or an alternative time established 
by an OCC officer to meet their minimum Clearing Fund cash 
contribution.
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    \25\ Id.
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III. Discussion and Commission Findings

    Section 19(b)(2)(C) of the Exchange Act directs the Commission to 
approve a proposed rule change of a self-regulatory organization if it 
finds that such proposed rule change is consistent with the 
requirements of the Exchange Act and the rules and regulations 
thereunder applicable to such organization.\26\ After carefully 
considering the proposed rule change, the Commission finds that the 
proposal is consistent with the requirements of the Exchange Act and 
the rules and regulations thereunder applicable to OCC. More 
specifically, the Commission finds that the proposal, is consistent 
with Section 17A(b)(3)(F) of the

[[Page 31919]]

Exchange Act \27\ and Rule 17Ad-22(e)(8) under the Exchange Act \28\ as 
described in detail below.
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    \26\ 15 U.S.C. 78s(b)(2)(C).
    \27\ 15 U.S.C. 78q-1(b)(3)(F).
    \28\ 17 CFR 240.17Ad-22(e)(8).
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A. Consistency With Section 17A(b)(3)(F) of the Exchange Act

    Section 17A(b)(3)(F) of the Exchange Act requires, among other 
things, that a clearing agency's rules are designed to promote the 
prompt and accurate clearance and settlement of securities transactions 
and, to the extent applicable, derivative agreements, contracts, and 
transactions; and the rules are designed, in general, to protect 
investors and the public interest.\29\ Based on its review of the 
record, and for the reasons described below, the Commission believes 
that the proposed changes are consistent with facilitating the prompt 
and accurate clearance and settlement of securities transactions and 
derivative agreements, contracts, and transactions for which OCC is 
responsible, and protecting investors and the public interest.
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    \29\ 15 U.S.C. 78q-1(b)(3)(F).
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    The Commission believes that OCC, in amending its By-Laws and Rules 
to set a uniform time for satisfying start-of-day settlement at 8:00 
a.m. CT (9:00 a.m. ET) and applying the updated Settlement Time to the 
Daily Margin Report (Rule 605), general Clearing fund deficits (Rule 
1005(a)), Clearing Fund replenishments and assessments (Rule 1006(h)), 
Rule amendment-related Clearing Fund deficits (Rule 1002(e)), and 
temporary increases in the Clearing Fund Cash Requirement (Rule 
1002.03) will remove any potential confusion or ambiguity for Clearing 
Members that could result from having different start-of-day settlement 
times depending on the nature of the Settlement Fund collection type. 
The alignment to a single Settlement Time would therefore facilitate 
the prompt and accurate clearance and settlement of transactions for 
which OCC is responsible.
    Further, the Commission believes that OCC, in amending Rule 1005(b) 
to shorten the collection period for deficits due to Clearing Fund 
monthly and intra-month resizings, will ensure that such Clearing Fund 
deficits are covered earlier than before. This would in turn reduce any 
existing liquidity risk and provide greater certainty regarding OCC's 
liquidity resources, thereby supporting OCC's ability to meet its 
obligations. Strengthening OCC's ability to meet its payment 
obligations would, in turn, promote its ability to ensure prompt 
settlement of securities transactions for which OCC is responsible.
    OCC also proposed changes to Rule 1002(e) to increase the 
notification period for Clearing Member deficits due to Rule amendments 
from two business days to five business days. The Commission believes 
that this proposed change would benefit Clearing Members by giving them 
additional time to consider canceling their clearing membership with 
OCC in the event of a Clearing Fund contribution increase created by 
amendments to OCC's Rules. Clearing Members could use the additional 
time to consider their ability to cover such increases with greater 
deliberation, which could allow members to unwind positions in an 
orderly fashion rather than defaulting on obligations to OCC. The 
promotion of an orderly unwinding of positions, as opposed to a 
potentially more disruptive Clearing Member default scenario, would in 
turn promote the protection of investors and the public interest.
    OCC also proposed conforming changes to its Clearing Fund 
Methodology Policy and its Liquidity Resource Management Framework to 
ensure consistency of the policy and framework with the changes 
described above. The Commission believes, therefore, that the 
conforming changes are consistent with the requirements of Section 
17A(b)(3)(F) for the reasons described above.
    The Commission believes, therefore, that the proposal is consistent 
with the requirements of Section 17A(b)(3)(F) of the Exchange Act.\30\
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    \30\ 15 U.S.C. 78q-1(b)(3)(F).
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B. Consistency With Rule 17Ad-22(e)(8) Under the Exchange Act

    Rule 17Ad-22(e)(8) under the Exchange Act requires that a covered 
clearing agency establish, implement, maintain, and enforce written 
policies and procedures reasonably designed to define the point at 
which settlement is final no later than the end of the day on which the 
payment or obligation is due and, where necessary or appropriate, 
intraday or in real time.\31\ Based on its review of the record, the 
Commission believes that the proposed rule change is consistent with 
this requirement.
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    \31\ 17 CFR 240.17Ad-22(e)(8).
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    OCC's proposal to modify its rules to change the definitions of 
``settlement time'' from 9:00 a.m. CT to 8:00 a.m. CT would move the 
start-of-day settlement time up by one hour, but would provide no less 
clear a time by which settlement is due than OCC's current rules. As 
proposed, settlement finality for cleared transactions would continue 
to occur when a settlement bank either accepts or confirms the 
settlement instruction. Similarly, OCC's proposed changes to reduce or 
increase the number of days a Clearing Member has to meet certain 
Clearing Fund obligations would provide no less certainty regarding the 
time by which settlement must occur than is provided by OCC's current 
rules.
    The Commission believes, therefore, that the proposal is consistent 
with the requirements of Rule 17Ad-22(e)(8) under the Exchange Act.\32\
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    \32\ 17 CFR 240.17Ad-22(e)(8).
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IV. Solicitation of Comments on Partial Amendment No. 1 to the Proposed 
Rule Change

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change, as modified by Partial Amendment No. 1, is consistent with the 
Exchange Act. Comments may be submitted by any of the following 
methods:

Electronic Comments

    <bullet> Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
    <bullet> Send an email to <a href="/cdn-cgi/l/email-protection#f486819891d9979b9999919a8087b4879197da939b82"><span class="__cf_email__" data-cfemail="89fbfce5eca4eae6e4e4ece7fdfac9faeceaa7eee6ff">[email protected]</span></a>. Please include 
File Number SR-OCC-2022-004 on the subject line.

Paper Comments

    <bullet> Send paper comments in triplicate to: Secretary, 
Securities and Exchange Commission, 100 F Street NE, Washington, DC 
20549-1090.

All submissions should refer to File Number SR-OCC-2022-004. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's internet website (http://www.sec.gov/rules/sro.shtml). 
Copies of the submission, all subsequent amendments, all written 
statements with respect to the proposed rule change that are filed with 
the Commission, and all written communications relating to the proposed 
rule change between the Commission and any person, other than those 
that may be withheld from the public in accordance with the provisions 
of 5 U.S.C. 552, will be available for website viewing and printing in 
the Commission's Public Reference Room, 100 F Street NE, Washington, DC 
20549 on official business days between the hours of

[[Page 31920]]

10:00 a.m. and 3:00 p.m. Copies of the filing also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change. Persons submitting 
comments are cautioned that we do not redact or edit personal 
identifying information from comment submissions. You should submit 
only information that you wish to make available publicly. All 
submissions should refer to File Number SR-OCC-2022-004 and should be 
submitted on or before June 15, 2022.

V. Accelerated Approval of Proposed Rule Change, as Modified by Partial 
Amendment No. 1

    The Commission finds good cause, pursuant to Section 19(b)(2) of 
the Exchange Act,\33\ to approve the proposed rule change prior to the 
30th day after the date of publication of notice of the filing of 
Partial Amendment No. 1 in the Federal Register. As discussed above, 
Partial Amendment No. 1 modified the original proposed rule change by 
making conforming changes to OCC's Liquidity Risk Management Framework 
consistent with the initial filing. Partial Amendment No. 1 does not 
change the purpose of or basis for the proposed changes.
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    \33\ 15 U.S.C. 78s(b)(2).
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    For similar reasons as discussed above, the Commission finds that 
Partial Amendment No. 1 is consistent with the requirement that OCC's 
rules be designed to promote the prompt and accurate clearance and 
settlement of securities transactions under Section 17A(b)(3)(F) of the 
Exchange Act.\34\ Accordingly, the Commission finds good cause, 
pursuant to Section 19(b)(2) of the Exchange Act, to approve the 
proposed rule change, as modified by Partial Amendment No. 1, on an 
accelerated basis, pursuant to Section 19(b)(2) of the Exchange 
Act.\35\
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    \34\ 15 U.S.C. 78q-1(b)(3)(F).
    \35\ 15 U.S.C. 78s(b)(2).
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VI. Conclusion

    On the basis of the foregoing, the Commission finds that the 
proposed rule change, as modified by Partial Amendment No. 1, is 
consistent with the requirements of the Exchange Act, and in 
particular, the requirements of Section 17A of the Exchange Act \36\ 
and the rules and regulations thereunder.
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    \36\ In approving this proposed rule change, the Commission has 
considered the proposed rules' impact on efficiency, competition, 
and capital formation. See 15 U.S.C. 78c(f).
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Exchange Act,\37\ that the proposed rule change (SR-OCC-2022-004), as 
modified by Partial Amendment No. 1, be, and hereby is, approved on an 
accelerated basis.
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    \37\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\38\
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    \38\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-11205 Filed 5-24-22; 8:45 am]
BILLING CODE 8011-01-P


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