Document ID: SEC-2023-0223-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: ICE Clear Europe, Ltd.
Posted Date: 2023-02-23T05:00Z

[Federal Register Volume 88, Number 36 (Thursday, February 23, 2023)]
[Notices]
[Pages 11488-11490]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-03698]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-96943; File No. SR-ICEEU-2023-006]

Self-Regulatory Organizations; ICE Clear Europe Limited; Notice 
of Filing and Immediate Effectiveness of Proposed Rule Change Relating 
to Amendments Part Q of its White Sugar Delivery Procedures

February 16, 2023.
    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 February 6, 2023, 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 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).

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[[Page 11489]]

I. Clearing Agency's Statement of the Terms of Substance of the 
Proposed Rule Change

    ICE Clear Europe Limited (``ICE Clear Europe'' or the ``Clearing 
House'') proposes to amend Part Q of its White Sugar Delivery 
Procedures to make certain clarifications around the origin of the 
deliverable crop and certain matters relating to delivery notifications 
and presentation of delivery documents.\5\
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    \5\ Capitalized terms used but not defined herein have the 
meanings specified in the Delivery Procedures or, if not defined 
therein, the ICE Clear Europe Clearing Rules.
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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 Q of its Delivery 
Procedures to clarify certain provisions relating to delivery 
specifications for ICE Futures Europe Financial and Softs White Sugar 
futures contracts, to be consistent with amendments that have been made 
to the contract specifications under exchange rules. The proposed 
amendments would provide that deliverable sugar under such contracts 
must have been produced in a country included in the list of 
deliverable countries of production maintained by the exchange, 
consistent with exchange rules. Delivery would have to be made at an 
eligible delivery port (as defined in exchange rules as a port located 
in one of such countries that meets the requirements in exchange 
rules).
    The amendments would update documentation and other requirements 
under the delivery timetable. The amendments would clarify the relevant 
Tender Day (which is the business day following the Last Trading Day). 
The concept of Notice of Tender would be replaced with Delivery 
Notification, to be consistent with exchange rules, and the amendments 
would clarify that a separate notification must be provided for each 
underlying client at each Delivery Port. The contents of the Delivery 
Notification and manner of submission would also be specified. The 
timing of allocations of white sugar to Buyers (and related 
notifications) would be moved from after 10:30 LPT to after 14:00 LPT.
    Consistent with exchange rules, the concept of ``Insufficient 
Seller'' would be revised to be a seller in respect of a Delivery Port 
for which the minimum lot requirement under exchange rules is not 
satisfied (and the concept of non-qualifying port would be removed). 
Requirements for Insufficient Sellers to submit revised Delivery 
Notifications would be clarified (including that relevant notifications 
must be made to and from the Clearing House, instead of the exchange). 
The amendments would add that revised Delivery Notifications that do 
not meet a minimum Delivery Port lot requirement will be rejected, and 
Insufficient Sellers would be required to submit a further revised 
Delivery Notification meeting the relevant requirement. Where the 
Insufficient Seller fails to do so, the Clearing House will determine 
the Deliver Port from which tenders are to be made.
    The amendments would also clarify the delivery documentation to be 
provided by the seller, including relevant certifications in accordance 
with the contract terms, as well as procedures for rejection of 
presented documents. The amendments would also provide that certain 
related notifications are to be made to and from the Clearing House 
(rather than the exchange), consistent with the role of the Clearing 
House in the delivery process.
    Certain typographical corrections and similar non-substantive 
drafting clarifications have been made in Part Q.
(b) Statutory Basis
    ICE Clear Europe believes that the proposed amendments to Part Q of 
the Delivery Procedures are consistent with the requirements of Section 
17A of the Act \6\ and the regulations thereunder applicable to it. In 
particular, 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, 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 clarify ICE Clear 
Europe's arrangements and delivery procedures relating to Financial and 
Softs White Sugar futures contracts and ensure consistency with the 
relevant contract specifications under exchange rules. Notably, the 
amendments would reflect the requirement under exchange rules that 
deliverable sugar be produced in one of the countries listed in the 
list of deliverable countries of production maintained by the exchange. 
In addition, the amendments clarify the timing of allocations by the 
Clearing House and certain related delivery notification and delivery 
documentation requirements. The contracts will otherwise continue to be 
cleared by ICE Clear Europe in the same manner as they are currently. 
In ICE Clear Europe's view, the amendments are thus consistent with the 
prompt and accurate clearance and settlement of cleared contracts and 
the protection of investors and the public interest. (ICE Clear Europe 
would not expect the amendments to affect the safeguarding of 
securities and funds in ICE Clear Europe's custody or control or for 
which it is responsible). Accordingly, the amendments satisfy the 
requirements of Section 17A(b)(3)(F).\8\
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    \6\ 15 U.S.C. 78q-1.
    \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\ requires that each covered 
clearing agency ``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 clarify the 
delivery specifications for Financial and Softs White Sugar futures 
contracts. The amendments would also clarify the obligations of the 
Clearing House (as opposed to the exchange) in the notification and 
delivery documentation process. The amendments would not otherwise 
change the manner in which the contracts are cleared or in which 
delivery is made, as supported by ICE Clear Europe's existing financial 
resources, risk management, systems and operational arrangements. The 
amendments thus 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

[[Page 11490]]

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 are being adopted to update and clarify the delivery 
specifications in Part Q of the Delivery Procedures in connection with 
White Sugar contracts. ICE Clear Europe does not expect that the 
proposed changes will adversely affect access to clearing or the 
ability of Clearing Members, their customers or other market 
participants to continue to clear contracts. ICE Clear Europe also does 
not believe the amendments would materially affect the cost of clearing 
or otherwise impact competition among Clearing Members or other market 
participants or limit market participants' choices for selecting 
clearing services. Accordingly, ICE Clear Europe does not believe the 
amendments would impose any burden on competition not necessary or 
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-2023-006 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-2023-006. 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-2023-006 and should be 
submitted on or before March 16, 2023.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-03698 Filed 2-22-23; 8:45 am]
BILLING CODE 8011-01-P