[Federal Register Volume 85, Number 108 (Thursday, June 4, 2020)]
[Notices]
[Pages 34468-34470]
[FR Doc No: 2020-12018]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-88974; File No. SR-OCC-2020-005]

Self-Regulatory Organizations; The Options Clearing Corporation;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Extend the Deadline for Clearing Members To Provide an Actionable
Identifier on Customer and Non-Customer Securities Options Trades Other
Than Market Maker Trades

May 29, 2020.
    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 May 19, 2020, 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 by OCC. OCC filed the proposed rule change pursuant
to Section 19(b)(3)(A) \3\ of the Act and Rule 19b-4(f)(1) \4\
thereunder so that the proposal was 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)(1).
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I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change

    OCC proposes to amend Rule 401 to modify the implementation and
enforcement timeline for requiring an ``Actionable Identifier'' to be
included on all customer and non-customer securities options trades
submitted to OCC for processing, other than Market-Maker trades. The
proposed changes to OCC's Rules are contained in Exhibit 5 of the
filing. Material proposed to be added to OCC's Rules as currently in
effect is marked by underlining and material proposed to be deleted is
marked with strikethrough text. All terms with initial capitalization
that are not otherwise defined herein have the same meaning as set
forth in the By-Laws and Rules.\5\
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    \5\ OCC's By-Laws and Rules can be found on OCC's public
website: http://optionsclearing.com/about/publications/bylaws.jsp.
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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, 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, he Proposed Rule Change

(1) Purpose
Background
    The Clearing Member Trade Assignment (``CMTA'') process at OCC
allows a Clearing Member that executed a securities options trade
(i.e., the Executing Clearing Member) to send the trade directly
through OCC to another Clearing Member for clearance and settlement
(i.e., the Carrying Clearing Member).\6\ Under the CMTA process, an
Executing Clearing Member and a Carrying Clearing Member can agree to
have securities options trades for customers and non-customers effected
by the Executing Clearing Member sent directly through OCC to the
Carrying Clearing Member's omnibus accounts at OCC for clearance and
settlement.\7\ One potential risk that may arise in the CMTA process is
that Clearing Members may receive customer trades that they do not
recognize in a timely manner because the trades do not include
information that allows them to quickly identify the correct customer
account at the Carrying Clearing Member or that the trade should have
been sent to another Carrying Clearing Member.
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    \6\ See OCC Rule 407. An ``Executing Clearing Member'' is
defined in Article I, Section 1.E.(12) of the By-Laws as ``a
Clearing Member, on its own behalf or as the Clearing Member of an
Introducing Broker that has been authorized by a Carrying Clearing
Member to direct confirmed trades to be transferred to a designated
account of the Carrying Clearing Member pursuant to such Clearing
Members' CMTA arrangement.'' A ``Carrying Clearing Member'' is
defined in Article I, Section 1.C.(12) of the By-Laws as ``a
Clearing Member that has authorized an Executing Clearing Member to
direct the transfer of a confirmed trade to a designated account of
such Carrying Clearing Member pursuant to a CMTA arrangement.''
    \7\ The term ``customer'' is defined in Article I, Section 1.C.
(37) of the By-Laws with regard to listed options as ``a person
having a securities account at a broker or dealer other than a non-
customer of such broker or dealer.'' The term ``non-customer'' is
defined in Article I, Section 1.N.(1) of the By-Laws effectively as
``a person that is not a customer of a broker or dealer as defined
in Rules 8c-1 and 15c2-1 under the Securities Exchange Act of
1934,'' including ``a Member Affiliate that has consented to having
its securities account at a Clearing Member treated as a non-
customer account.'' OCC Clearing Members hold omnibus accounts at
OCC for customer positions (i.e., a ``customers' account'' as
defined in Article I, Section 1.C.(37) of the By-Laws) and non-
customer positions (i.e., a ``firm account'' as defined in Article
I, Section 1.F.(6) of the By-Laws).
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    On May 6, 2019, the Commission approved a proposed rule change by
OCC to amend Rule 401 to require that an Actionable Identifier be
included on all customer and non-customer securities options trades
submitted to OCC for processing, other than Market-Maker trades.\8\
Actionable Identifier is defined in Interpretation and Policy .06 to
Rule 401 as either the name, series of numbers, or other identifying
information assigned by a Purchasing Clearing Member or Writing
Clearing Member to a customer or non-customer account (other than a
Market-Maker account) at the Clearing Member that originated the
options transaction. The introduction of the Actionable Identifier
requirement was intended to minimize the risks Clearing Members face in
handling trades they cannot timely identify in connection with the CMTA
process.
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    \8\ See Securities Exchange Act Release No. 85779 (May 6, 2019),
84 FR 20689 (May 10, 2019) (SR-OCC-2019-003).
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    The implementation plan for Actionable Identifier requirement,
which is specified in Interpretation and Policy .06 to Rule 401, sets
forth the effective dates for the rule change, providing that: (a) From
the date on which the Actionable Identifier requirement is approved
(``approval date'') to the end of the twelfth month from such approval
date, OCC will not treat as a violation of Rule 401 the failure to
include an Actionable Identifier or the failure of a Clearing Member's
policies and procedures to provide that sufficient information is
included in the Actionable Identifier field to allow the Clearing
Member receiving such Actionable Identifier to promptly clear the
transaction; (b) from the thirteenth to the end of the eighteenth month
from such approval date, an Actionable Identifier will be required but
OCC will not treat as a violation of Rule 401 the failure of a Clearing
Member's policies and procedures to provide that sufficient information
is included in the Actionable Identifier field to allow the Clearing
Member receiving such Actionable Identifier to promptly clear the
transaction; and (c) from the nineteenth month after such approval date
and thereafter, OCC will treat as a violation of Rule 401 the failure
to include an Actionable Identifier or the failure of a Clearing
Member's policies and procedures to provide that sufficient information
is included in the Actionable Identifier field to allow the Clearing
Member receiving such Actionable Identifier to promptly clear the
transaction, subject to the manner in which OCC enforces violations of
its rules in Rule 1201. This phased implementation plan was intended to
provide time for Clearing Members to work together to determine
appropriate Actionable Identifiers for the accounts subject to their
CMTA arrangements and coordinate on processes to include Actionable
Identifiers on trades submitted through the give-up process.
    Recently, some Clearing Members have requested that OCC delay the
deadline for requiring an Actionable Identifier on trades (``Actionable
Identifier Deadline''), which is set for June 8, 2020. On this date,
OCC would begin to enforce the Actionable Identifier requirement but
would not treat as a violation of Rule 401 the failure of a Clearing
Member's policies and procedures to provide that sufficient information
is included in the Actionable Identifier field. Due to the COVID-19
pandemic, many Clearing Members are functioning under business
continuity plans. OCC has been informed by many Clearing Members that
because they are operating under business continuity plans, system
enhancements are now limited to critical or essential system
installations only. As a result, Clearing Members cannot install system
functionality that will allow them to comply with the June 8, 2020
Actionable Identifier Deadline. Additionally, Clearing Members require
input from floor brokers to implement Actionable Identifier
information.\9\ Clearing Members are limited by remote working
conditions to coordinate directly with the floor brokers on the changes
needed to populate the identifier on the trades. Given these factors,
Clearing Members may require additional time to comply with the
requirements of Rule 401(a)(1)(iii) and Interpretation and Policy .06.
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    \9\ Floor brokers receive and execute trades on behalf of
customers. Clearing Members and floor brokers will therefore need to
coordinate to have an agreed upon identifier for their various
customers.
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Proposed Change
    OCC proposes to amend Interpretation and Policy .06 to Rule 401 to
extend the deadline for requiring Actionable Identifiers on all
customer and non-customer securities options trades submitted to OCC
for processing, other than Market-Maker trades, by an additional three
months from June 2020 to September 2020. OCC believes that extending
the Actionable Identifier Deadline by three months will provide
Clearing Members with the additional

time they will need to make the necessary system changes to comply with
the requirements of Rule 401. OCC believes the proposed rule change is
appropriate given current conditions caused by the COVID-19 pandemic
and does not believe that changes to the final implementation deadline
of December 7, 2020, are necessary at this time.
(2) Statutory Basis
    Section 17A(b)(3)(F) of the Act \10\ requires, among other things,
that the rules of a clearing agency be designed to promote the prompt
and accurate clearance and settlement of securities and derivatives
transactions and to foster cooperation and coordination with persons
engaged in clearance and settlement of securities transactions. The
Actionable Identifier requirements of Rule 401 are designed to enable
Clearing Members to more promptly and accurately clear and settle
securities options trades that are subject to CMTA and give-up
arrangements. The proposed rule change would provide additional time
for OCC's Clearing Members to make the necessary system changes to
effectively implement Actional Identifiers given the recent
complications caused by the COVID-19 pandemic. In this way, the
proposed rule change is designed to promote the prompt and accurate
clearance and settlement of securities transactions and foster
cooperation and coordination with persons engaged in clearance and
settlement of securities transactions in accordance with the
requirements of Section 17A(b)(3)(F).\11\
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    \10\ 15 U.S.C. 78q-1(b)(3)(F).
    \11\ Id.
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    In addition, the proposed rule change is not inconsistent with the
existing By-Laws and Rules of OCC, including any rules proposed to be
amended.

(B) Clearing Agency's Statement on Burden on Competition

    Section 17A(b)(3)(I) of the Act \12\ requires that the rules of a
clearing agency not impose any burden on competition not necessary or
appropriate in furtherance of the Act. OCC does not believe that the
proposed rule change would impact or impose any burden on competition.
The proposed rule change would provide Clearing Members with additional
time to comply with the Actionable Identifier requirements previously
approved by the Commission.\13\ The proposed rule change would not
affect the competitive dynamics between Clearing Members in that it
would apply to all Clearing Members equally. The proposed rule change
also would not inhibit access to OCC's services or disadvantage or
favor any particular user in relationship to another. In this regard,
as described above, the proposed rule change is designed to further
facilitate the prompt and accurate clearance and settlement of
securities transaction.
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    \12\ 15 U.S.C. 78q-1(b)(3)(I).
    \13\ See supra note 8.
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(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.

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

    Pursuant to Section 19(b)(3)(A) \14\ of the Act, and Rule 19b-
4(f)(1) thereunder,\15\ the proposed rule change is filed for immediate
effectiveness as it constitutes a stated policy, practice, or
interpretation with respect to the meaning, administration, or
enforcement of an existing rule. The proposed rule change would modify
the implementation and enforcement dates of rule changes previously
approved by the Commission in OCC filing SR-OCC-2019-003.\16\
Accordingly, the proposed rule change constitutes a stated policy,
practice, or interpretation with respect to the administration and
enforcement of an existing rule of OCC.
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    \14\ 15 U.S.C. 78s(b)(3)(A).
    \15\ 17 CFR 240.19b-4(f)(1).
    \16\ See supra note 8.
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    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.\17\
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    \17\ Notwithstanding its immediate effectiveness, implementation
of this rule change will be delayed until this change is deemed
certified under CFTC Rule 40.6.
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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 Comment

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-OCC-2020-005 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-OCC-2020-005. 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 filing also will be available for inspection
and copying at the principal office of OCC and on OCC's website at
https://www.theocc.com/about/publications/bylaws.jsp.
    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-OCC-2020-005 and
should be submitted on or before June 25, 2020.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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    \18\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-12018 Filed 6-3-20; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 76, Number 67 (Thursday, April 7, 2011)]
[Notices]
[Pages 19350-19351]
[FR Doc No: 2011-8304]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. ID-6528-000]

Truax, Hal D.; Notice of Filing

    Take notice that on April 1, 2011, Hal D. Truax submitted for
filing, an application for authority to hold interlocking positions,
pursuant to section 305(b) of the Federal Power Act, 16 U.S.C. 825d (b)
(2008), part 45 of Title 18 of the Code of Federal Regulations, 18 CFR
part 45, and Commission Order No. 664, 112 FERC ] 61,298 (2005).
    Any person desiring to intervene or to protest this filing must
file in accordance with Rules 211 and 214 of the Commission's Rules of
Practice and Procedure (18 CFR 385.211, 385.214). Protests will be
considered by the Commission in determining the appropriate action to
be taken, but will not serve to make protestants parties to the
proceeding. Any person wishing to become a party must file a notice of
intervention or motion to intervene, as appropriate. Such notices,
motions, or protests must be filed on or before the comment date. On or
before the comment date, it is not necessary to serve motions to
intervene or protests on persons other than the Applicant.
    The Commission encourages electronic submission of protests and
interventions in lieu of paper using the ``eFiling'' link at http://www.ferc.gov. Persons unable to file electronically should submit an
original and 14 copies of the protest or intervention to the Federal
Energy Regulatory Commission, 888 First Street, NE., Washington, DC
20426.
    This filing is accessible on-line at http://www.ferc.gov, using the
``eLibrary'' link and is available for review in the Commission's
Public Reference Room in Washington, DC. There is an ``eSubscription''
link on the

Web site that enables subscribers to receive e-mail notification when a
document is added to a subscribed docket(s). For assistance with any
FERC Online service, please e-mail<EMAIL_ADDRESS>or call
(866) 208-3676 (toll free). For TTY, call<PHONE_NUMBER>.
    Comment Date: 5 p.m. Eastern Time on April 21, 2011.

    Dated: April 1, 2011.
Kimberly D. Bose,
Secretary.
[FR Doc. 2011-8304 Filed 4-6-11; 8:45 am]
BILLING CODE 6717-01-P