Document ID: SEC-2014-0786-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: ICE Clear Credit LLC
Posted Date: 2014-05-13T04:00Z

[Federal Register Volume 79, Number 92 (Tuesday, May 13, 2014)]
[Notices]
[Pages 27354-27355]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-10897]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-72116; File No. SR-ICC-2014-02]

Self-Regulatory Organizations; ICE Clear Credit LLC; Order 
Approving Proposed Rule Change To Update ICC's Liquidity Thresholds for 
Euro Denominated Products

May 7, 2014.

I. Introduction

    On March 12, 2014, ICE Clear Credit LLC (``ICC'') filed with the 
Securities and Exchange Commission (``Commission'') the proposed rule 
change SR-ICC-2014-02 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 April 1, 2014.\3\ The Commission received no comment letters 
regarding the proposed change. 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. 34-71810 (March 26, 
2014), 79 FR 18377 (April 1, 2014) (SR-ICC-2014-02).
---------------------------------------------------------------------------

II. Description

    ICC is proposing to update its liquidity thresholds for Euro 
denominated products. Under the proposed changes, ICC will require the 
first 65% of Clearing Participant Non-Client Initial Margin and 
Guaranty Fund Liquidity Requirements (``Non-Client Liquidity 
Requirements'') to be satisfied with collateral in the currency of the 
underlying instrument. ICC notes that for United States Dollar 
(``USD'') denominated products, its rules already state that the first 
65% of Non-Client Liquidity Requirements must be satisfied with USD 
denominated collateral, the first 45% of which must be posted in USD 
cash and the next 20% of which may be posted in USD denominated assets 
(USD cash and/or US Treasury securities). Currently, for Euro 
denominated products, 45% of Non-Client Liquidity Requirements must be 
posted in Euro cash and the next 20% may be posted in Euro cash, USD 
cash, and/or US Treasury securities.
    Accordingly, ICC proposes updating the liquidity thresholds for 
Euro denominated products, listed in Schedule 401 of the ICC Rules, to 
require the first 65% of Non-Client Liquidity Requirements for Euro 
denominated products to be satisfied

[[Page 27355]]

with Euro cash. ICC states that this change is intended to increase the 
Euro cash Non-Client Liquidity Requirements for Euro denominated 
products and create more consistent liquidity requirements across USD 
and Euro denominated products. In addition to updating its rules, ICC 
also proposes to update the ICC Treasury Operations Policies and 
Procedures to reflect the proposed change in ICC's Non-Client Liquidity 
Requirements for Euro denominated products. ICC states that the update 
to the ICC Treasury Operations Policies and Procedures will not require 
any operational changes.
    ICC also proposes to remove redundant references to ``US cash'' in 
Schedule 401 of the ICC Rules, as US cash is included in all ``G7 
cash'' references.

III. Discussion and Commission Findings

    Section 19(b)(2)(C) of the Act \4\ directs the Commission to 
approve a proposed rule change of a self-regulatory organization if the 
Commission finds that such proposed rule change is consistent with the 
requirements of the Act and the rules and regulations thereunder 
applicable to such self-regulatory organization. Section 17A(b)(3)(F) 
of the Act \5\ requires, among other things, that the rules of a 
clearing agency are designed to promote the prompt and accurate 
clearance and settlement of securities transactions and, to the extent 
applicable, derivative agreements, contracts, and transactions, to 
assure the safeguarding of securities and funds which are in the 
custody or control of the clearing agency or for which it is 
responsible and, in general, to protect investors and the public 
interest.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78s(b)(2)(C).
    \5\ 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.\6\ The proposed change 
provides ICC with increased available liquidity and is therefore 
consistent with the requirements of Section 17A(b)(3)(F) of the Act \7\ 
of promoting the prompt and accurate clearance and settlement of 
securities transactions and, to the extent applicable, derivatives 
agreements, contracts, and transactions, and helping to protect 
investors and the public interest.
---------------------------------------------------------------------------

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

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 \8\ and the 
rules and regulations thereunder.
---------------------------------------------------------------------------

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

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\9\ that the proposed rule change (File No. SR-ICC-2014-02) be, and 
hereby is, approved.\10\
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(2).
    \10\ 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.\11\
---------------------------------------------------------------------------

    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-10897 Filed 5-12-14; 8:45 am]
BILLING CODE 8011-01-P