Document ID: SEC-2022-0356-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: ICE Clear Europe Limited
Posted Date: 2022-03-17T04:00Z

[Federal Register Volume 87, Number 52 (Thursday, March 17, 2022)]
[Notices]
[Pages 15277-15279]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-05596]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-94404; File No. SR-ICEEU-2022-006]

Self-Regulatory Organizations; ICE Clear Europe Limited; Notice 
of Filing and Immediate Effectiveness of Proposed Rule Change Relating 
to Amendments to the ICE Clear Europe Delivery Procedures

March 11, 2022.
    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 March 7, 2022, ICE Clear Europe Limited (``ICE Clear Europe'' or the 
``Clearing House'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule changes described in Items I, II and 
III below, which Items have been prepared primarily by ICE Clear 
Europe. ICE Clear Europe filed the proposed rule change pursuant to 
Section 19(b)(3)(A) of the Act \3\ and Rule 19b-4(f)(4)(ii) 
thereunder,\4\ such that the proposed rule change was immediately 
effective upon filing with the Commission. The Commission is publishing 
this notice to solicit

[[Page 15278]]

comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(4)(ii).
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I. Clearing Agency's Statement of the Terms of Substance of the 
Proposed Rule Change

    The principal purpose of the proposed amendments is for ICE Clear 
Europe to amend Part H of its Delivery Procedures (``Delivery 
Procedures'' or ``Procedures'') to cover ICE Endex German THE Natural 
Gas Daily Futures Contracts (the ``Contracts''), natural gas futures 
contracts that will be traded on ICE Endex and cleared by ICE Clear 
Europe. The proposed updates would also make certain conforming changes 
elsewhere in the Delivery Procedures.

II. Clearing Agency's Statement of the Purpose of, and Statutory Basis 
for, the Proposed Rule Change

    In its filing with the Commission, ICE Clear Europe 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. ICE Clear Europe has prepared summaries, 
set forth in sections (A), (B), and (C) below, of the most significant 
aspects of such statements.

(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis 
for, the Proposed Rule Change

(a) Purpose
    ICE Clear Europe is proposing to amend Part H of the Delivery 
Procedures, which currently addresses delivery under ICE Endex German 
THE Natural Gas Futures Contracts (the ``Monthly Contract''), to also 
include the Contracts, which are a daily futures contract with respect 
to the same underlying commodity. The amendments would also make 
certain conforming changes elsewhere in the Delivery Procedures. The 
amended Delivery Procedures would provide the delivery specifications 
and processes related to delivery under the Contracts. Other minor 
drafting clarifications and updates would also be made.
    The amendments would provide that for the Contracts, the price at 
which the contract is delivered is the Exchange Delivery Settlement 
Price (EDSP) for the Business Day immediately prior to the calendar day 
on which the Delivery Day for the Contracts commences in accordance 
with ICE Endex Rules.
    The amendments would state the cessation of trading for the 
Contracts; specifically, the Contracts cease trading at 18:00 hours on 
the Business Day which is one Business Day prior to the Delivery Day, 
in accordance with ICE Endex Rules.
    With respect to Exchange for Physicals (EFPs) and Exchange for 
Swaps (EFSs), the amendments would provide that, for the Contracts, 
EFPs and EFSs may be posted up to thirty minutes following the 
cessation of trading.
    In the delivery timetable for routine deliveries of the current 
Monthly Contract, a minor correction would be made regarding timing 
specifications related to the nomination of a Transferor or Transferee. 
The related MPFE report to be made available to Clearing Members would 
be made available after (and not by) 12:30 CET.
    A new delivery timetable would be added for routine deliveries 
under the Contracts and failed delivery under the Contracts. The 
routine delivery timetable would set out, among other matters, 
deadlines for submissions of delivery intentions and nominations and 
other notifications, provision of buyer's and seller's security, 
confirmation of delivery and payment. The timetable relating to failed 
deliveries would address, among other matters, additional margin 
requirements and invoicing of payments for failed deliveries.
    In the delivery documentation summary timetable for the current 
Monthly Contract, a minor correction would be made regarding timing of 
the confirmation report. When available, a copy of such report must be 
provided by Buyers and Sellers to the relevant Transferor(s) and 
Transferee(s) by 12:30 CET (not 14:00 CET).
    A new delivery documentation summary timetable for the Contracts 
would be added which describes the certain reports to be made available 
to Clearing Members by the Clearing House with respect to the Contracts 
and certain other forms, as well as timing specifications.
(b) Statutory Basis
    ICE Clear Europe believes that the proposed amendments to the 
Delivery Procedures are consistent with the requirements of Section 17A 
of the Act \5\ and the regulations thereunder applicable to it. In 
particular, Section 17A(b)(3)(F) of the Act \6\ requires, among other 
things, that the rules of a clearing agency be designed to promote the 
prompt and accurate clearance and settlement of securities transactions 
and, to the extent applicable, derivative agreements, contracts, and 
transactions, the safeguarding of securities and funds in the custody 
or control of the clearing agency or for which it is responsible, and 
the protection of investors and the public interest. The proposed 
changes to the Delivery Procedures are designed to establish delivery 
procedures relating to the Contracts, which will be traded on ICE Endex 
and cleared at ICE Clear Europe. The amendments would set out delivery 
specifications related to the Contracts, including the settlement 
price, delivery timing and delivery documentation, in line with 
Delivery Procedures for the Monthly Contract and other types of 
deliverable energy futures contracts. Contracts providing for delivery 
under Part H will be cleared by the Clearing House in the substantially 
same manner as the existing Monthly Contract and other types of 
deliverable energy futures contracts and will be supported by ICE Clear 
Europe's existing F&O financial resources, risk management, systems and 
operational arrangements. Accordingly, ICE Clear Europe believes that 
its financial resources, risk management, systems and operational 
arrangements are sufficient to support clearing of such contracts and 
to manage the risks associated with such contracts. As a result, in ICE 
Clear Europe's view, the amendments would be consistent with the prompt 
and accurate clearance and settlement of the contracts, and the 
protection of investors and the public interest consistent with the 
requirements of Section 17A(b)(3)(F) of the Act.\7\ (In ICE Clear 
Europe's view, the amendments would not affect the safeguarding of 
funds or securities in the custody or control of the clearing agency or 
for which it is responsible, within the meaning of Section 
17A(b)(3)(F).\8\)
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    \5\ 15 U.S.C. 78q-1.
    \6\ 15 U.S.C. 78q-1(b)(3)(F).
    \7\ 15 U.S.C. 78q-1(b)(3)(F).
    \8\ 15 U.S.C. 78q-1(b)(3)(F).
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    In addition, Rule 17Ad-22(e)(10) \9\ provides that ``[e]ach covered 
clearing agency shall establish, implement, maintain and enforce 
written policies and procedures reasonable designed to, as applicable 
[. . .] establish and maintain transparent written standards that state 
its obligations with respect to the delivery of physical instruments, 
and establish and maintain operational practices that identify, monitor 
and manage the risks associated with such physical deliveries.'' As 
discussed above, the amendments would modify Part H of the Delivery 
Procedures to add procedures applicable to the delivery and settlement 
of the Contracts. The procedures would address, among other matters, 
delivery specifications for such contracts and certain other

[[Page 15279]]

documentation and timing matters, consistent with the requirements of 
the Clearing House. Clearance of the Contracts would otherwise be 
supported by ICE Clear Europe's existing financial resources, risk 
management, systems and operational arrangements. The amendments thus 
appropriately clarify the role and responsibilities of the Clearing 
House and Clearing Members with respect to physical delivery. As a 
result, ICE Clear Europe believes the amendments are consistent with 
the requirements of Rule 17Ad-22(e)(10).\10\
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    \9\ 17 CFR 240.17Ad-22(e)(10).
    \10\ 17 CFR 240.17Ad-22(e)(10).
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(B) Clearing Agency's Statement on Burden on Competition

    ICE Clear Europe does not believe the proposed amendments would 
have any impact, or impose any burden, on competition not necessary or 
appropriate in furtherance of the purposes of the Act. The proposed 
amendments to the Delivery Procedures are intended to establish 
procedures applicable to the delivery and settlement of the Contracts 
in connection with the listing of such Contracts for trading on the ICE 
Endex market. ICE Clear Europe believes that such contracts would 
provide opportunities for interested market participants to engage in 
trading activity in the relevant German natural gas market. ICE Clear 
Europe does not believe the amendments would adversely affect 
competition among Clearing Members, materially affect the cost of 
clearing, adversely affect access to clearing for Clearing Members or 
their customers, or otherwise adversely affect competition in clearing 
services. Accordingly, ICE Clear Europe does not believe that the 
amendments would impose any impact or burden on competition that is not 
appropriate in furtherance of the purpose of the Act.

(C) Clearing Agency's Statement on Comments on the Proposed Rule Change 
Received From Members, Participants or Others

    Written comments relating to the proposed amendments have not been 
solicited or received by ICE Clear Europe. ICE Clear Europe will notify 
the Commission of any comments received with respect to the proposed 
rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \11\ and paragraph (f) of Rule 19b-4 \12\ 
thereunder. 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.
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    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f).
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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 [email protected]. Please include 
File Number SR-ICEEU-2022-006 on the subject line.

Paper Comments

     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-ICEEU-2022-006. 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 10:00 a.m. and 
3:00 p.m. Copies of such filings will also be available for inspection 
and copying at the principal office of ICE Clear Europe and on ICE 
Clear Europe's website at https://www.theice.com/clear-europe/regulation.

    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-ICEEU-2022-006 and should be 
submitted on or before April 7, 2022.
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    \13\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
Eduardo Aleman,
Assistant Secretary.
[FR Doc. 2022-05596 Filed 3-16-22; 8:45 am]
BILLING CODE 8011-01-P