33222 Federal Register / Vol. 87, No. 105 / Wednesday, June 1, 2022 / Notices 

11 15 U.S.C. 78q–1(b)(3)(F). 

12 17 CFR 240.17Ad–22(e)(2)(i). 

13 Id. 

14 17 CFR 240.17Ad–22(e)(23)(v). 

15 17 CFR 240.17Ad–22(e)(23)(v). 

16 15 U.S.C. 78q–1(b)(3)(F). 

17 17 CFR 240.17Ad–22(e)(2)(i) and (e)(23)(v). 

18 15 U.S.C. 78s(b)(2). 

19 In approving the proposed rule change, the 

Commission considered the proposal’s impact on 

efficiency, competition, and capital formation. 15 

U.S.C. 78c(f). 

20 17 CFR 200.30–3(a)(12). 1See 17 CFR 270.270.12d3–1(c)(3). 

proposed rule change is consistent with 

Section 17A(b)(3)(F) of the Act.11

B. Consistency With Rule 17Ad– 

22(e)(2)(i) 

Rules 17Ad–22(e)(2)(i) requires each 

covered clearing agency to establish, 

implement, maintain, and enforce 

written policies and procedures 

reasonably designed to, as applicable, 

provide for governance arrangements 

that are clear and transparent.12 As 

described above, the proposed changes 

more clearly set out the responsibilities 

of the Legal Department and include 

updates with respect to relevant internal 

individuals and committees involved in 

the governance process. The 

Commission believes that by clearly 

describing the responsibilities of the 

Legal Department, committees, 

subcommittees, and their participants as 

noted above, these proposed changes 

provide for clear and transparent 

governance arrangements to those 

serving on those committees and 

utilizing the Governance Playbook. For 

the reasons stated above, the 

Commission believes the proposed rule 

changes are consistent with Rules 

17Ad–22(e)(2)(i).13

C. Consistency With Rule 17Ad– 

22(e)(23)(v) Under the Act 

Rule 17Ad–22(e)(23)(v) under the Act 

require each covered clearing agency to 

establish, implement, maintain and 

enforce written policies and procedures 

reasonably designed to provide for an 

update of the public disclosure every 

two years, or more frequently following 

changes to the covered clearing agency’s 

system or the environment in which it 

operates to the extent necessary, to 

ensure statements previously provided 

remain accurate in all material 

respects.14

As noted above, the proposed changes 

assign responsibility, reference 

applicable regulations, and include 

additional information and procedures 

regarding maintaining and updating the 

Disclosure Framework in accordance 

with relevant regulations. Specifically, 

the proposed changes would update the 

process by which the ICC Legal 

Department will update the public 

Disclosure Framework every two years 

or more frequently following material 

changes to ICC’s systems or 

environment in which it operates, 

including updates for major decisions of 

the Board with a broad market impact. 

The Commission believes that these 

aspects of the Governance Playbook 

provide further clarity regarding ICC’s 

policies and procedures for making a 

comprehensive public disclosure that is 

updated every two years or more 

frequently following material changes. 

For these reasons, the Commission 

believes that the proposed rule change 

is consistent with Rule 17Ad– 

22(e)(23)(v) under the Act.15

IV. Conclusion 

On the basis of the foregoing, the 

Commission finds that the proposed 

rule change is consistent with the 

requirements of the Act, and in 

particular, with the requirements of 

Section 17A(b)(3)(F) of the Act 16 and 

Rules 17Ad–22(e)(2)(i) and 17Ad– 

22(e)(23)(v) thereunder.17

It is therefore ordered pursuant to 

Section 19(b)(2) of the Act 18 that the 

proposed rule change (SR–ICC–2022– 

003), be, and hereby is, approved.19

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.20

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–11678 Filed 5–31–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[SEC File No. 270–504, OMB Control No. 

3235–0561] 

Proposed Collection; Comment 

Request; Extension: Rule 12d3–1 

Upon Written Request, Copies Available 

From: Securities and Exchange 

Commission, Office of FOIA Services, 

100 F Street NE, Washington, DC 

20549–2736 

Notice is hereby given that, pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501 et seq.), the Securities 

and Exchange Commission (the 

‘‘Commission’’) is soliciting comments 

on the collections of information 

summarized below. The Commission 

plans to submit these existing 

collections of information to the Office 

of Management and Budget (‘‘OMB’’) for 

extension and approval. 

Rule 12d3–1 (17 CFR 270.12d3–1) 

under the Investment Company Act of 

1940 (15 U.S.C. 80a–1 et seq.) 

(‘‘Investment Company Act’’) permits a 

fund to invest up to five percent of its 

assets in securities of an issuer deriving 

more than fifteen percent of its gross 

revenues from securities-related 

businesses (subject to certain 

limitations), notwithstanding the 

general prohibition in Section 12(d)(3) 

of the Investment Company Act of a 

registered investment company (‘‘fund’’) 

and companies controlled by the fund 

purchasing securities issued by a 

registered investment adviser, broker, 

dealer, or underwriter (‘‘securitiesrelated businesses’’). 

A fund may, however, rely on an 

exemption in rule 12d3–1 to acquire 

securities issued by its subadvisers in 

circumstances in which the subadviser 

would have little ability to take 

advantage of the fund, because it is not 

in a position to direct the fund’s 

securities purchases. This exemption in 

rule 12d3–1 is available if: (i) The 

subadviser is not, and is not an affiliated 

person of, an investment adviser that 

provides advice with respect to the 

portion of the fund that is acquiring the 

securities; and (ii) the advisory contracts 

of the subadviser, and any subadviser 

that is advising the purchasing portion 

of the fund, prohibit them from 

consulting with each other concerning 

securities transactions of the fund, and 

limit their responsibility in providing 

advice to providing advice with respect 

to discrete portions of the fund’s 

portfolio.1

Rule 12d3–1 requires funds to amend 

their subadvisory contracts before they 

can rely on rule 12d3–1’s exemption to 

ensure that the subadviser that engages 

in the transaction does not influence the 

fund’s investment decision to engage in 

the transaction. 

Based on an analysis of fund filings, 

Commission staff estimates that 

approximately 285 funds enter into such 

new subadvisory agreements each year, 

and that it will require approximately 3 

attorney hours to draft and execute 

additional clauses in new subadvisory 

contracts in order for funds and 

subadvisers to be able to rely on the 

exemptions in rule 12d3–1. Because 

these additional clauses are identical to 

the clauses that a fund would need to 

insert in their subadvisory contracts to 

rely on rules 10f–3 (17 CFR 270.10f–3), 

17a–10 (17 CFR 270.17a–10), and 17e– 

1 (17 CFR 270.17e–1), and because we 

believe that funds that use one such rule 

generally use all of these rules, we 

apportion this 3 hour time burden 

equally to all four rules. Therefore, we 

estimate that the burden allocated to 

rule 12d3–1 for this contract change 


jspears on DSK121TN23PROD with NOTICES1
Federal Register / Vol. 87, No. 105 / Wednesday, June 1, 2022 / Notices 33223 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3Self-Regulatory Organizations; ICE Clear Credit 

LLC; Notice of Filing of Proposed Rule Change 

Relating to the ICC Recovery Plan and the ICC 

Wind-Down Plan, Exchange Act Release No. 94650 

(Apr. 8, 2022); 87 FR 22276 (Apr. 14, 2022) (File 

No. SR–ICC–2022–004) (‘‘Notice’’). 

4The term ‘‘covered clearing agency’’ is defined 

in Rule 17Ad–22(a)(5), 17 CFR 240.17Ad–22(a)(5). 

ICC became subject to the requirements in Rule 

17Ad–22(e) with the amendment to the definition 

of the term ‘‘covered clearing agency.’’ See 

Definition of ‘‘Covered Clearing Agency,’’ Exchange 

Act Release No. 88616 (Apr. 9, 2020), 85 FR 28853 

(May 14, 2020) (File No. S7–23–16). 

5 17 CFR 240.17Ad–22(e)(3)(ii). 

6Standards for Covered Clearing Agencies, 

Exchange Act Release No. 78961 (Sep. 28, 2016), 81 

FR 70786, 70809 (Oct. 13, 2016) (File No. S7–03– 

14). 

7 ICC became a ‘‘covered clearing agency’’ 

following a change in the definition of the term in 

Rule 17Ad–22(a)(5). The previous definition of 

‘‘covered clearing agency’’ in Rule 17Ad–22(a)(5) 

stated that ‘‘covered clearing agency’’ means a 

designated clearing agency or a clearing agency 

involved in activities with a more complex risk 

profile for which the Commodity Futures Trading 

Commission is not the Supervisory Agency as 

defined in Section 803(8) of the Payment, Clearing 

and Settlement Supervision Act of 2010 (12 U.S.C. 

5461 et seq.). Under this definition, ICC was not a 

covered clearing agency. Under the revised 

definition, ‘‘covered clearing agency’’ means a 

registered clearing agency that provides the services 

of a central counterparty or central securities 

depository. Under the revised definition, ICC is a 

covered clearing agency. See Definition of ‘‘Covered 

Clearing Agency’’, Exchange Act Release No. 88616 

(Apr. 9, 2020), 85 FR 28853, 28854–55 (May 14, 

2020) (File No. S7–23–16). 

8Self-Regulatory Organizations; ICE Clear Credit 

LLC; Order Approving Proposed Rule Change 

Relating to the ICC Recovery Plan and the ICC 

Wind-Down Plan, Exchange Act Release No. 91806 

(May 10, 2021), 86 FR 26561 (May 14, 2021) (File 

No. SR–ICC–2021–005). 

9The descriptions of the Recovery and WindDown Plans are substantially excerpted from the 

Notice. Moreover, capitalized terms not otherwise 

defined herein have the meanings assigned to them 

in ICC Rules (‘‘Rules’’) or the Plans. 

would be 0.75 hours. Assuming that all 

285 funds that enter into new 

subadvisory contracts each year make 

the modification to their contract 

required by the rule, we estimate that 

the rule’s contract modification 

requirement will result in 214 burden 

hours annually. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

unless it displays a currently valid 

control number. 

Written comments are invited on: (a) 

Whether the proposed collection of 

information is necessary for the proper 

performance of the functions of the 

Commission, including whether the 

information shall have practical utility; 

(b) the accuracy of the Commission’s 

estimates of the burden of the proposed 

collection of information; (c) ways to 

enhance the quality, utility, and clarity 

of the information collected; and (d) 

ways to minimize the burden of the 

collection of information on 

respondents, including through the use 

of automated collection techniques or 

other forms of information technology. 

Consideration will be given to 

comments and suggestions submitted in 

writing within 60 days of this 

publication by August 1, 2022. 

Please direct your written comments 

to David Bottom, Director/Chief 

Information Officer, Securities and 

Exchange Commission, C/O John 

Pezzullo, 100 F Street NE, Washington, 

DC 20549; or send an email to: PRA_

Mailbox@sec.gov. 

Dated: May 25, 2022. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–11662 Filed 5–31–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94983; File No. SR–ICC– 

2022–004] 

Self-Regulatory Organizations; ICE 

Clear Credit LLC; Order Approving 

Proposed Rule Change Relating to the 

ICC Recovery Plan and the ICC WindDown Plan 

May 25, 2022. 

I. Introduction 

On April 1, 2022, CE Clear Credit LCC 

(‘‘ICC’’) filed with the Securities and 

Exchange Commission (‘‘Commission’’), 

pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’),1 and Rule 19b–4 thereunder,2 a 

proposed rule change to amend the ICC 

Recovery Plan and the ICC Wind-Down 

Plan (collectively, the ‘‘Plans’’). The 

proposed rule change was published for 

comment in the Federal Register on 

April 14, 2022.3 The Commission did 

not receive comments regarding the 

proposed rule change. For the reasons 

discussed below, the Commission is 

approving the proposed rule change. 

II. Description of the Proposed Rule 

Change 

A. Background 

As a ‘‘covered clearing agency,’’ 4 ICC 

is required to, among other things, 

‘‘establish, implement, maintain and 

enforce written policies and procedures 

reasonably designed to . . . maintain a 

sound risk management framework for 

comprehensively managing legal, credit, 

liquidity, operational, general business, 

investment, custody, and other risks 

that arise in or are borne by the covered 

clearing agency, which . . . includes 

plans for the recovery and orderly winddown of the covered clearing agency 

necessitated by credit losses, liquidity 

shortfalls, losses from general business 

risk, or any other losses.’’ 5 The 

Commission has previously clarified 

that it believes that such recovery and 

wind-down plans are ‘‘rules’’ within the 

meaning of Exchange Act Section 19(b) 

and Rule 19b–4 thereunder because 

such plans would constitute changes to 

a stated policy, practice, or 

interpretation of a covered clearing 

agency.6 Accordingly, a covered 

clearing agency, such as ICC, is required 

to file its plans for recovery and orderly 

wind-down with the Commission.7

Recovery and Wind-Down Plans have 

been in place at ICC for a number of 

years and approved by the Commission 

on May 10, 2021 for the first time since 

becoming a ‘‘covered clearing agency’’ 

under the definition in Rule 17Ad– 

22(a)(5).8

B. Recovery Plan 

The proposed rule change would 

make general updates to ensure that the 

information in the Recovery Plan is 

current and relates to changes that 

impacted ICC in the past year.9 The 

Recovery Plan would be updated to 

specify that the information provided is 

current as of December 31, 2021, unless 

otherwise stated. 

The proposed rule change would 

make the following updates related to 

ICC’s ownership and operations: 

• In Section II.A, add one additional 

entity to the list of companies owned by 

ICC’s parent. 

• In Section IV.A, adds iTraxx Index 

Swaptions as an example of the Index 

Swaptions products for which ICC 

provides clearing services. 

• In Section IV.D, updates numbers 

for ICC’s revenues, volumes, and 

expenses and includes those for Index 

Swaptions. 

• In Section VI.A, updates locations 

of facilities and personnel headcount 

and functions. 

• In Section X, updates the projected 

recovery and wind-down costs and 

regulatory capital. 

• In Section XI, updates ICC’s and 

ICE Group’s financial statements. 

• In Section XIII, updates the 

percentages held by financial services 

providers of clearing participant cash 

and collateral. 

The proposed rule change would also 

revise Section IV.C.1 to reflect (i) the 

change of the Board size from eleven to 

nine managers, consistent with the 


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