Document ID: SEC-2013-0631-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: ICE Clear Credit LLC
Posted Date: 2013-04-02T04:00Z

[Federal Register Volume 78, Number 63 (Tuesday, April 2, 2013)]
[Notices]
[Pages 19790-19791]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-07583]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-69243; File No. SR-ICC-2013-01]

Self-Regulatory Organizations; ICE Clear Credit LLC; Order 
Approving Proposed Rule Change, as Modified by Amendments No. 1 and 2 
Thereto, To Update Chapter 26 and Remove Schedule 502 of the ICE Clear 
Credit Rules

March 27, 2013.

I. Introduction

    On January 31, 2013, ICE Clear Credit LLC (``ICC'') filed with the 
Securities and Exchange Commission (``Commission'') the proposed rule 
change SR-ICC-2013-01 pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder.\2\ The 
proposed rule change was published for comment in the Federal Register 
on February 21, 2013.\3\ On March 7, 2013, ICC filed Amendment No. 1 to 
the proposed rule change.\4\ On March 14, 2013, ICC filed Amendment No. 
2 to the proposed rule change.\5\ The Commission did not receive 
comments regarding the proposal. For the reasons discussed below, the 
Commission is granting approval of the proposed rule change.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Securities Exchange Act Release No. 68928 (Feb. 14, 2013), 
78 FR 12125 (Feb. 21, 2013).
    \4\ In Amendment No. 1, ICC amended the filing to remove 
European index CDS and European single-name CDS from Schedule 502 of 
the ICC Rulebook (``ICC Rules''), which were added to the ICC Rules 
subsequent to ICC filing this proposed rule change. The amendment 
also included conforming changes to the chapters of the ICC Rules 
referencing iTraxx Europe index CDS and European single-name CDS to 
reflect the removal of Schedule 502.
    \5\ In Amendment No. 2, ICC amended the filing to remove certain 
index series listings scheduled to occur on March 20, 2013, and 
March 27, 2013, which were added to Schedule 502 subsequent to ICC 
filing this proposed rule change. ICC also amended Chapter 26G of 
the ICC Rules to change the abbreviation for ``Standard European 
Corporate'' from ``SNEC'' to ``SDEC''.
---------------------------------------------------------------------------

II. Description

    The purpose of the proposed rule change is to update Chapter 26 
(Cleared CDS Products) of the ICC Rules and remove Schedule 502 (List 
of Pre-Approved Products) from the ICC Rules. The proposed rule change 
also includes a conforming edit within Chapter 5 (Risk Committee) of 
the ICC Rules. This update will provide direct reference within the ICC 
Rules to the cleared products list always available on the ICC Web site 
(``Approved Products List'') and add additional standards for certain 
ICC cleared products. ICC agrees that rule submissions for updates to 
ICC's cleared product offering will be required under certain 
circumstances (e.g., certain financial single names, additional single-
name constituents of the Emerging Markets Index, and High Yield single 
names).
    ICC proposes to amend Chapter 26 of its rules to update the 
definitions of Eligible CDX.NA Untranched Index (Rule 26A-102), 
Eligible SNAC Reference Entities (Rule 26B-102), Eligible SNAC 
Reference Obligations (Rule 26B-102), Eligible CDX.EM Untranched Index 
(Rule 26C-102), Eligible SES Reference Entities (Rule 26D-102), 
Eligible SES Reference Obligations (Rule 26D-102), Eligible iTraxx 
Europe Untranched Index (Rule 26F-102), Eligible SDEC Reference 
Entities (Rule 26G-102) and Eligible SDEC Reference Obligations (Rule 
26G-102) to include the requirement that the products must be 
determined by ICC to be eligible.
    ICC proposes to amend Chapter 26 of its rules to update the 
definitions of List of Eligible CDX.NA Untranched Indexes (Rule 26A-
102), List of Eligible SNAC Reference Entities (Rule 26B-102), List of 
Eligible CDX.EM Untranched Indexes (Rule 26C-102), List of Eligible SES 
Reference Entities (Rule 26D-102), List of Eligible iTraxx Europe 
Untranched Indexes (Rule 26F-102) and List of Eligible SDEC Reference 
Entities (Rule 26G-102) to include the reference that the Approved 
Products List will be maintained, updated and published on the ICC Web 
site.
    ICC proposes to amend Chapter 26 of its rules to add the definition 
of Eligible SNAC Sector in Rule 26B-102 of the

[[Page 19791]]

ICC Rules. The listed Eligible SNAC Sectors are: Basic Materials, 
Consumer Goods, Consumer Services, Energy, Financials, Healthcare, 
Industrials, Technology, Telecommunications Services, and Utilities. 
The requirement to list the Eligible SNAC Sector on the List of 
Eligible SNAC Reference Entities is also added to the definition of 
List of Eligible SNAC Reference Entities in Rule 26B-102.
    ICC proposes to amend Chapter 26 of its rules to add the definition 
of Eligible SDEC Sector in Rule 26G-102 of the ICC Rules. The listed 
Eligible SDEC Sectors are: Basic Materials, Consumer Goods, Consumer 
Services, Energy, Financials, Healthcare, Industrials, Technology, 
Telecommunications Services, and Utilities. The requirement to list the 
Eligible SDEC Sector on the List of Eligible SDEC Reference Entities is 
also added to the definition of List of Eligible SDEC Reference 
Entities in Rule 26G-102.
    ICC proposes to amend Chapter 26 of its rules to include within the 
definition of List of Eligible SES Reference Entities in Rule 26D-102 
the requirement to list the Sector, Government, in the List of Eligible 
SES Reference Entities.
    ICC proposes to remove Schedule 502 from the ICC Rules as Schedule 
502 provides information available in the Approved Products List on the 
ICC Web site. The Approved Products List provides the information 
currently available in Schedule 502 as well as all additional product 
information listed in the definitions of List of Eligible CDX.NA 
Untranched Indexes (Rule 26A-102), List of Eligible SNAC Reference 
Entities (Rule 26B-102), List of Eligible CDX.EM Untranched Indexes 
(Rule 26C-102), List of Eligible SES Reference Entities (Rule 26D-102), 
List of Eligible iTraxx Europe Untranched Indexes (Rule 26F-102) and 
List of Eligible SDEC Reference Entities (Rule 26G-102).
    ICC proposes to make one conforming amendment to Chapter 5 of its 
rules, specifically Rule 502(a), to change a reference to Schedule 502 
of the ICC Rules to reference the Approved Products List on the ICC Web 
site.
    The proposed changes to the ICC Rules will provide direct reference 
within the ICC Rules to the cleared products list available on the ICC 
Web site and add additional standards for certain ICC cleared products. 
The proposed rule changes do not require any changes to the ICC risk 
management framework including the ICC margin methodology, guaranty 
fund methodology, pricing parameters and pricing model.

III. Discussion

    Section 19(b)(2)(C) of the Act \6\ 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 Act and the rules and regulations thereunder 
applicable to such organization. Section 17A(b)(3)(F) of the Act \7\ 
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.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78s(b)(2)(C).
    \7\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------

    The Commission finds that the proposed rule change is consistent 
with the requirements of Section 17A of the Act \8\ and the rules and 
regulations thereunder applicable to ICC. The proposed rule change 
would provide direct reference within the ICC Rules to the Approved 
Products List available on the ICC Web site and add additional 
standards for certain ICC cleared products to assure that Clearing 
Participants are informed of the ICC approved products, thereby 
promoting the prompt and accurate clearance and settlement of swaps and 
security-based swaps transactions.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78q-1.
---------------------------------------------------------------------------

IV. Conclusion

    On the basis of the foregoing, the Commission finds that the 
proposal is consistent with the requirements of the Act and in 
particular with the requirements of Section 17A of the Act \9\ and the 
rules and regulations thereunder.
---------------------------------------------------------------------------

    \9\ Id.
---------------------------------------------------------------------------

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\10\ that the proposed rule change (File No. SR-ICC-2013-01), as 
modified by Amendments No. 1 and 2, be, and hereby is, approved.\11\
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78s(b)(2).
    \11\ 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).
---------------------------------------------------------------------------

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
---------------------------------------------------------------------------

    \12\ 17 CFR 200.30-3(a)(12).

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-07583 Filed 4-1-13; 8:45 am]
BILLING CODE 8011-01-P