Federal Register / Vol. 81, No. 26 / Tuesday, February 9, 2016 / Notices 6917 

11 15 U.S.C. 78f. 

12 In approving this proposed rule change, the 

Commission notes that it has considered the 

proposed rule’s impact on efficiency, competition, 

and capital formation. See 15 U.S.C. 78c(f). 

13 15 U.S.C. 78f(b)(5). 

14See Notice, supra note 3, 80 FR at 79373. 

15The Exchange states: ‘‘According to Federal 

Reserve Bank of New York data as of September 

2015, average daily trading volume for U.S. 

Treasury bills totaled $67.8 billion. . . . SPX 

options are among the most liquid index options in 

the U.S. and derive their value from the actively 

traded S&P 500 Index components. SPX options are 

cash-settled with no delivery of stocks or ETFs, and 

trade in competitive auction markets with price and 

quote transparency. The Exchange believes that the 

highly regulated S&P 500 options markets, and the 

broad base and scope of the S&P 500 Index, make 

securities that derive their value from that index, 

including S&P 500 options, less susceptible to 

potential market manipulation in view of market 

capitalization and liquidity of the S&P 500 Index 

components, price and quote transparency, and 

arbitrage opportunities.’’ Id. 

16The Exchange states: ‘‘In addition, the Treasury 

market and its participants are subject to a wide 

range of oversight and regulations, including 

requirements designed to prevent market 

manipulation and other abuses. For example, 

Treasury market participants and the Treasury 

market, itself, are subject to significant oversight by 

a number of regulatory authorities, including the 

Treasury, the Commission, federal bank regulators, 

and the Financial Industry Regulatory Authority.’’ 

Id., n.15. The Exchange represents that the SPX 

Puts will be subject to CBOE and FINRA 

surveillance programs. See id., 80 FR at 79374. 

17See id., 80 FR at 79372–73. 

18 15 U.S.C. 78f(b)(5). 

19 15 U.S.C. 78s(b)(2). 

20 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A)(ii). 

4 17 CFR 240.19b–4(f)(2). 

5 In 2015, the Commission approved (‘‘Approval 

Order’’) OCC’s plan for raising additional capital 

(‘‘Capital Plan’’), which was put in place in light of 

proposed regulatory capital requirements applicable 

to systemically important financial market utilities, 

such as OCC. See Securities Exchange Act Release 

No. 74452 (March 6, 2015) 80 FR 13058 (March 12, 

2015) (SR–OCC–2015–02). OCC also filed proposals 

in the Capital Plan Filing as an advance notice 

under Section 806(e)(1) of the Payment, Clearing, 

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

5465(e)(1). On February 26, 2015, the Commission 

issued a notice of no objection to the advance notice 

filing. See Exchange Act Release No. 74387 

(February 26, 2015), 80 FR 12215 (March 6, 2015) 

(SR–OCC–2014–813). BATS Global Markets, Inc., 

BOX Options Exchange LLC, KCG Holdings, Inc., 

Miami International Securities Exchange, LLC, and 

Susquehanna International Group, LLP (collectively 

‘‘Petitioners’’) each filed petitions for review of the 

Approval Order, challenging the action taken by 

delegated authority. The filing of the petitions 

automatically stayed the Approval Order. OCC filed 

a Motion to Lift the Stay on April 2, 2015, and the 

Continued 

Regulatory Authority (‘‘FINRA’’), on 

behalf of the Exchange, or the regulatory 

staff of the Exchange, will communicate 

as needed regarding trading in the 

Shares and SPX Index options with 

other markets and other entities that are 

members of the Intermarket 

Surveillance Group (‘‘ISG’’), and FINRA, 

on behalf of the Exchange, or the 

regulatory staff of the Exchange, may 

obtain trading information regarding 

trading in the portfolio securities from 

these markets and other entities. In 

addition, the regulatory staff of the 

Exchange may obtain information 

regarding trading in the portfolio 

securities from markets and other 

entities that are members of ISG or with 

which the Exchange has in place a 

comprehensive surveillance sharing 

agreement. 

III. Discussion and Commission’s 

Findings 

After careful review, the Commission 

finds that the exchange’s proposal is 

consistent with the requirements of 

Section 6 of the Act 11 and the rules and 

regulations thereunder applicable to a 

national securities exchange.12 In 

particular, the Commission finds that 

the proposed rule change is consistent 

with Section 6(b)(5) of the Act,13 which 

requires, among other things, that the 

Exchange’s rules be designed to prevent 

fraudulent and manipulative acts and 

practices, to promote just and equitable 

principles of trade, to remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system, and, in 

general, to protect investors and the 

public interest. 

The Commission believes that it 

would be difficult to manipulate the 

price of the Shares by manipulating the 

prices of its underlying assets. The 

Fund’s portfolio will comprise cash, 

short-term U.S. Treasury bills, and SPX 

Puts.14 The Exchange contends that 

neither short-term Treasury securities 

nor SPX Puts are readily susceptible to 

market manipulation due to the deep 

liquidity in15 and extensive oversight of 

those markets.16 With respect to SPX 

Puts, specifically, the Exchange has 

provided data demonstrating that the 

average daily trading volume (through 

expiration) of recent SPX Puts compares 

favorably to the average daily trading 

volumes of at-the-money put options on 

other major indexes and is, in fact, 

higher than that of at-the-money puts on 

the Russell 2000 index.17

For these reasons, the Commission 

believes that it would be difficult to 

manipulate the price of the Shares by 

manipulating the prices of its 

underlying assets. The Commission also 

notes that, except as discussed above, 

all other representations made in 

support of the Prior Release remain 

unchanged. 

For the foregoing reasons, the 

Commission finds that the proposed 

rule change is consistent with Section 

6(b)(5) of the Act 18 and the rules and 

regulations thereunder applicable to a 

national securities exchange. 

IV. Conclusion 

It is therefore ordered, pursuant to 

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

proposed rule change (SR–NYSEArca– 

2015–113), be, and it hereby 

is,approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.20

Robert W. Errett, 

Deputy Secretary. 

[FR Doc. 2016–02440 Filed 2–8–16; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–77041; File No. SR–OCC– 

2016–001] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change To Revise 

the Options Clearing Corporation’s 

Schedule of Fees 

February 3, 2016. 

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

Securities Exchange Act of 1934 

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

notice is hereby given that on January 

20, 2016, The Options Clearing 

Corporation (‘‘OCC’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared primarily by OCC. OCC filed 

the proposed rule change pursuant to 

Section 19(b)(3)(A)(ii) 3 of the Act and 

Rule 19b–4(f)(2) 4 thereunder so that the 

proposal was effective upon filing with 

the Commission. The Commission is 

publishing this notice to solicit 

comments on the rule change from 

interested persons. 

I. Clearing Agency’s Statement of the 

Terms of Substance of the Proposed 

Rule Change 

The purpose of this proposed rule 

change by The Options Clearing 

Corporation (‘‘OCC’’) is to revise OCC’s 

Schedule of Fees effective March 1, 

2016, to implement a reduction of 

clearing fees in accordance with OCC’s 

Fee Policy, which was recently adopted 

as part of OCC’s Capital Plan.5

mstockstill on DSK4VPTVN1PROD with NOTICES

6918 Federal Register / Vol. 81, No. 26 / Tuesday, February 9, 2016 / Notices 

Petitioners responded. The Commission 

subsequently determined that the automatic stay of 

delegated action should be discontinued, and the 

Commission granted OCC’s Motion to Lift Stay of 

the staff’s action in approving by delegated 

authority File No. SR–OCC–2015–02. 

6See supra note 5. 

7The Business Risk Buffer is equal to net income 

before refunds, dividends, and taxes divided by 

total revenue. 

8OCC’s Schedule of Fees must also meet the 

requirements set forth in Article IX, Section 9 of 

OCC’s By-Laws. In general, Article IX, Section 9 of 

OCC’s By-Laws requires that OCC’s fee structure be 

designed to: (1) Cover OCC’s operating expenses 

plus a business risk buffer, (2) maintain reserves 

deemed reasonably necessary by OCC’s Board of 

Directors, and (3) accumulate an additional surplus 

deemed advisable by the Board of Directors to 

permit OCC to meet its obligations to its clearing 

members and the public. Clauses 2 and 3 above will 

only be invoked at the discretion of OCC’s Board 

of Directors and in extraordinary circumstances. 

9OCC previously revised its Schedule of Fees 

effective April 1, 2014, to reinstate permanent 

reduced fee rates for securities options and 

securities futures that were originally adopted 

effective May 1, 2007. See Securities Exchange Act 

Release No. 71769 (March 21, 2014), 79 FR 17214 

(March 27, 2014) (SR–OCC–2014–05). 

10 In order to validate this approach, OCC back 

tested its volume projecting methodology against 

data from the previous five years and determined 

that such methodology yields reasonable estimate of 

future contract volume. 

11These changes are also reflected in Exhibit 5. 

Market maker/specialist scratch and linkage fees 

per side will remain unchanged at $0.020. 

12Any subsequent changes to OCC’s Schedule of 

Fees would be the subject of a subsequent proposed 

rule change filed with the Commission. 

13 17 U.S.C. 78q–1(b)(3)(D). 

14See supra note 5. 

15 15 U.S.C. 78q–1(b)(3)(I). 

II. Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change 

In its filing with the Commission, 

OCC included statements concerning 

the purpose of and basis for the 

proposed rule change and discussed any 

comments it received on the proposed 

rule change. The text of these statements 

may be examined at the places specified 

in Item IV below. OCC has prepared 

summaries, set forth in sections (A), (B), 

and (C) below, of the most significant 

aspects of these statements. 

(A) Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change 

1. Purpose 

The purpose of this proposed rule 

change is to revise OCC’s Schedule of 

Fees in accordance with its new Fee 

Policy. The revised fee schedule would 

become effective on March 1, 2016. 

By way of background, in 2015, the 

Commission approved OCC’s Capital 

Plan,6 which was put in place in light 

of proposed regulatory capital 

requirements applicable to systemically 

important financial market utilities, 

such as OCC. As part of OCC’s Capital 

Plan, OCC adopted a Fee Policy 

whereby OCC would set clearing fees at 

a level that covers OCC’s operating 

expenses plus a Business Risk Buffer 7

of 25%.8 The purpose of the Business 

Risk Buffer is to ensure that OCC 

accumulates sufficient capital to cover 

unexpected fluctuations in operating 

expenses, business capital needs, and 

regulatory capital requirements. 

OCC analyzed its current Schedule of 

Fees 9 against projected revenues and 

projected expenses for 2016 in 

accordance with its Fee Policy. The 

primary goal of this analysis was to 

determine a fee setting approach for 

2016 that covers OCC’s anticipated 

operating expenses, seeks to minimize 

the number of fee resets under normal 

market conditions, and seeks to achieve 

a Business Risk Buffer of 25%. To 

project revenue (which is a product of 

cleared contract volume and clearing 

fees per contract), OCC estimated 

cleared contract volume per month for 

2016 by computing the average of the 

previous 12 months of actual cleared 

contract volume data, excluding the 

high and low volume months, and used 

such average as the anticipated cleared 

contract volume per month for 2016.10

For expenses, OCC used projected 2016 

expenses, computed at the end of 2015 

as part of OCC’s 2016 budgeting process. 

OCC arrived at the fee schedule 

presented herein by determining the 

figures that would result in a coverage 

OCC’s anticipated operating expenses 

plus a Business Risk Buffer of 25%. 

As a result of the aforementioned 

analysis, OCC proposes to revise its 

Schedule of Fees as set forth below.11

Trades with contracts of: Current fee Proposed fee 

1–500 ...................................................................................................... $0.050/contract ................................................. $0.041/contract. 

501–1000 ................................................................................................ $0.040/contract ................................................. $0.032/contract. 

1001–2000 .............................................................................................. $0.030/contract ................................................. $0.024/contract. 

>2000 ...................................................................................................... $55.00/trade ..................................................... $46.00/trade. 

OCC anticipates that the proposed 

changes to OCC’s Schedule of Fees 

would result in an average decrease in 

clearing fees of 19%. Moreover, and in 

accordance with its Fee Policy, OCC 

will continue to monitor cleared 

contract volume and operating expenses 

in order to determine if further revisions 

to OCC’s Schedule of Fees are required 

so that monies received from clearing 

fees cover OCC’s operating expenses 

plus a Business Risk Buffer of 25%.12

2. Statutory Basis 

OCC believes that the proposed rule 

change concerning a reduction to OCC’s 

clearing fees is consistent with Section 

17A(b)(3)(D) 13 of the Act, because the 

proposed fee schedule provides for the 

equitable allocation of reasonable fees 

among its clearing members and other 

market participants pursuant to criteria 

set forth in OCC’s Capital Plan, which 

has been approved by the 

Commission.14 The revised fee schedule 

would result in lower clearing fees for 

OCC’s clearing members and other 

market participants and would be 

equally applicable to all market 

participants. The proposed rule change 

is not inconsistent with the existing 

rules of OCC, including any other rules 

proposed to be amended. 

(B) Clearing Agency’s Statement on 

Burden on Competition 

OCC does not believe that the 

proposed rule change would have an 

impact or impose a burden on 

competition.15 Although this proposed 

rule change affects clearing members, 

their customers, and the markets that 

OCC serves, OCC believes that the 

proposed rule change would not 

disadvantage or favor any particular 

user of OCC’s services in relationship to 

another user because the proposed 

clearing fees apply equally to all users 

of OCC. Accordingly, OCC does not 

believe that the proposed rule change 

would have any impact or impose a 

burden on competition. 

(C) Clearing Agency’s Statement on 

Comments on the Proposed Rule 

Change Received From Members, 

Participants or Others 

Written comments on the proposed 

rule change were not and are not 

intended to be solicited with respect to 

the proposed rule change and none have 

been received. 

mstockstill on DSK4VPTVN1PROD with NOTICES

Federal Register / Vol. 81, No. 26 / Tuesday, February 9, 2016 / Notices 6919 

16Notwithstanding the immediate effectiveness of 

the proposed rule change and OCC’s anticipated 

implementation date of March 1, 2016, 

implementation of this rule change is also 

contingent on it being deemed certified under CFTC 

Regulation § 40.6. 

17 15 U.S.C. 78s(b)(3)(A)(ii). 

18 17 CFR 240.19b–4(f)(2). 19 17 CFR 200.30–3(a)(12). 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective upon filing 16 pursuant to 

Section 19(b)(3)(A)(ii) of the Act 17 and 

Rule 19b–4(f)(2) thereunder 18 because it 

constitutes a change in fees imposed by 

OCC on its clearing members and other 

market participants using OCC’s 

services. At any time within 60 days of 

the filing of the proposed rule change, 

the Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

OCC–2016–001 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Brent J. Fields, Secretary, Securities 

and Exchange Commission, 100 F Street 

NE., Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–OCC–2016–001. 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 Web site (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 Web site 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 

10:00 a.m. and 3:00 p.m. Copies of such 

filing also will be available for 

inspection and copying at the principal 

office of OCC and on OCC’s Web site at 

http://www.theocc.com/components/

docs/legal/rules_and_bylaws/sr_occ_16_

001.pdf. All comments received will be 

posted without change; the Commission 

does not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. All 

submissions should refer to File 

Number SR–OCC–2016–001 and should 

be submitted on or before March 1, 

2016. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

Robert W. Errett, 

Deputy Secretary. 

[FR Doc. 2016–02443 Filed 2–8–16; 8:45 am] 

BILLING CODE 8011–01–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #14589 and #14590] 

Mississippi Disaster Number MS– 

00083 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Amendment 2. 

SUMMARY: This is an amendment of the 

Presidential declaration of a major 

disaster for Public Assistance Only for 

the State of Mississippi (FEMA–4248– 

DR), dated 01/04/2016. 

Incident: Severe Storms, Tornadoes, 

Straight-line Winds, and Flooding. 

Incident Period: 12/23/2015 through 

12/28/2015. 

Effective Date: 01/22/2016. 

Physical Loan Application Deadline 

Date: 03/04/2016. 

Economic Injury (EIDL) Loan 

Application Deadline Date: 10/04/2016. 

ADDRESSES: Submit completed loan 

applications to: U.S. Small Business 

Administration, Processing and 

Disbursement Center, 14925 Kingsport 

Road, Fort Worth, TX 76155. 

FOR FURTHER INFORMATION CONTACT: A. 

Escobar, Office of Disaster Assistance, 

U.S. Small Business Administration, 

409 3rd Street SW., Suite 6050, 

Washington, DC 20416. 

SUPPLEMENTARY INFORMATION: The notice 

of the President’s major disaster 

declaration for Private Non-Profit 

organizations in the State of Mississippi, 

dated 01/04/2016, is hereby amended to 

include the following areas as adversely 

affected by the disaster. 

Primary Counties: Clay, Itawamba, 

Monroe, Prentiss, Tallahatchie. 

All other information in the original 

declaration remains unchanged. 

(Catalog of Federal Domestic Assistance 

Numbers 59002 and 59008) 

James E. Rivera, 

Associate Administrator for Disaster 

Assistance. 

[FR Doc. 2016–02483 Filed 2–8–16; 8:45 am] 

BILLING CODE 8025–01–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #14609] 

California Disaster #CA–00243 

Declaration of Economic Injury 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Notice. 

SUMMARY: This is a notice of an 

Economic Injury Disaster Loan (EIDL) 

declaration for the State of California, 

dated 02/02/2016. 

Incident: Ocean Conditions Resulting 

in the Delayed Commercial Dungeness 

Crab Season and Closure of Commercial 

Rock Crab Fishery. 

Incident Period: 11/06/2015 and 

continuing. 

Effective Date: 02/02/2016. 

EIDL Loan Application Deadline Date: 

11/02/2016. 

ADDRESSES: Submit completed loan 

applications to: U.S. Small Business 

Administration, Processing and 

Disbursement Center, 14925 Kingsport 

Road, Fort Worth, TX 76155. 

FOR FURTHER INFORMATION CONTACT: A. 

Escobar, Office of Disaster Assistance, 

U.S. Small Business Administration, 

409 3rd Street SW., Suite 6050, 

Washington, DC 20416. 

SUPPLEMENTARY INFORMATION: Notice is 

hereby given that as a result of the 

Administrator’s EIDL declaration, 

applications for economic injury 

disaster loans may be filed at the 

address listed above or other locally 

announced locations. 

The following areas have been 

determined to be adversely affected by 

the disaster: 

Primary Counties: Alameda, Butte, 

Contra Costa, Del Norte, El Dorado, 

Humboldt, Lake, Marin, Mendocino, 

mstockstill on DSK4VPTVN1PROD with NOTICES