[Federal Register Volume 80, Number 234 (Monday, December 7, 2015)]
[Notices]
[Pages 76055-76057]
[FR Doc No: 2015-30746]

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

SECURITIES AND EXCHANGE COMMISSION

Proposed Collection; Comment Request

Upon Written Request, Copies Available From: Securities and Exchange
Commission, Office of FOIA Services, 100 F Street NE., Washington, DC
20549-2736.

Extension:
    Rules 17Ad-22--Clearing Agency Standards and Governance, SEC
File No. 270-646, OMB Control No. 3235-0695.

    Notice is hereby given that pursuant to the Paperwork Reduction Act
of 1995 (``PRA'')(44 U.S.C. 3501 et seq.), the Securities and Exchange
Commission (``Commission'') is soliciting comments on the existing
collection of information provided for in Rules 17Ad-22 under the
Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.). The Commission
plans to submit this existing collection of information to the Office
of Management and Budget (``OMB'') for extension and approval.

i. Standards for Clearing Agencies

a. Measurement and Management of Credit Exposures

    Rule 17Ad-22(b)(1) would require a clearing agency that provides
CCP services to establish, implement, maintain and enforce written
policies and procedures reasonably designed to measure its credit
exposures to its participants at least once each day, and limit its
exposures to potential losses from defaults by its participants in
normal market conditions so that the operations of the clearing agency
would not be disrupted and non-defaulting participants would not be
exposed to losses that they cannot anticipate or control. The purpose
of the collection of information is to enable the clearing agency to
monitor and limit its exposures to its participants.

b. Margin Requirements

    Rule 17Ad-22(b)(2) would require a clearing agency that provides
CCP services to establish, implement, maintain and enforce written
policies and procedures reasonably designed to: (i) Use margin
requirements to limit its credit exposures to participants in normal
market conditions; (ii) use risk-based models and parameters to set
margin requirements; and (iii) review the models and parameters at
least monthly. The purpose of the collection of information is to
enable the clearing agency to maintain sufficient collateral or margin.

c. Financial Resources

    Rule 17Ad-22(b)(3) would require a clearing agency that provides
CCP services to establish, implement, maintain and enforce written
policies and procedures reasonably designed to maintain sufficient
financial resources to withstand, at a minimum, a default by the
participant family to which it has the largest exposure in extreme but
plausible market conditions, provided that a registered clearing agency
acting as a central counterparty for security-based swaps shall
maintain additional financial resources sufficient to withstand, at a
minimum, a default by the two participant families to which it has the
largest exposures in extreme but plausible market conditions, in its
capacity as a central counterparty for security-based swaps. The
purpose of the collection of information is to enable the clearing
agency to satisfy all of its settlement obligations in the event of a
participant default.

d. Model Validation

    Rule 17Ad-22(b)(4) would require a clearing agency that provides
CCP services to establish, implement, maintain and enforce written
policies and procedures reasonably designed to provide for an annual
model validation consisting of evaluating the performance of the
clearing agency's margin models and the related parameters and
assumptions associated with such models by a qualified person who is
free from influence from the persons responsible for the development or
operation of the models being validated. The purpose of the collection
of information is to enable the clearing agency to obtain an assessment
of its margin model by a qualified, independent person.

e. Non-Dealer Access

    Rule 17Ad-22(b)(5) would require a clearing agency that provides
CCP services to establish, implement, maintain and enforce written
policies and procedures reasonably designed to provide the opportunity
for a person that does not perform any dealer or security-based swap
dealer services to obtain membership at the clearing agency to clear
securities for itself or on behalf of other persons. The purpose of the
collection of information is to enable more market participants to
obtain indirect access to clearing agencies.

f. Portfolio Size and Transaction Volume Restrictions

    Rule 17Ad-22(b)(6) would require a clearing agency that provides
CCP services to establish, implement, maintain and enforce written
policies and procedures reasonably designed to have membership
standards that do not require that participants maintain a portfolio of
any minimum size or that participants maintain a minimum transaction
volume. The purpose of the collection of information is to remove
unnecessary barriers to participation in clearing agencies that provide
CCP services.

g. Net Capital Restrictions

    Rule 17Ad-22(b)(7) would require a clearing agency that provides
CCP services to establish, implement, maintain and enforce written
policies and procedures reasonably designed to provide a person that
maintains net capital equal to or greater than $50 million with the
ability to obtain membership at the clearing agency, provided that such
persons are able to comply with other reasonable membership standards,
with any net capital requirements being scalable so that they are
proportional to the risks posed by the participant's activities to the
clearing agency. The rule also permits a clearing agency to provide for
a higher net capital requirement (i.e., higher than $50 million) as a
condition for membership at the clearing agency if the clearing agency
demonstrates to the Commission that such a requirement is necessary to
mitigate risks that could not otherwise be effectively managed by other
measures, such as scalable limitations on the transactions that the
participants may clear through the clearing agency, and the Commission
approves the higher net capital requirement as part of a rule filing or
clearing agency registration application. The purpose of the collection
of information is to remove unnecessary barriers to clearing access by
market participants with a net capital level above $50 million, while
at the same time facilitating sound risk management practices by
clearing agencies by encouraging them to examine and articulate the
benefits that higher net capital requirements would create through
having clearing agencies develop scalable membership standards that
links the activities any participants could potentially engage in with
the potential risks posed by the participant.

h. Record of Financial Resources

    Rule 17Ad-22(c)(1) would require that each fiscal quarter (based on
calculations made as of the last business day of the clearing agency's
fiscal quarter), or at any time upon Commission request, a clearing
agency that performs CCP services shall calculate and maintain a record
of the financial resources necessary to meet the requirement in Rule
17Ad-22(b)(3) and sufficient documentation to explain the methodology
it uses to compute such financial resource requirement. The purpose of
the collection of information is to enable the Commission to monitor
the financial resources of clearing agencies that provide CCP services.

i. Annual Audited Financial Statements

    Rule 17Ad-22(c)(2) would require a clearing agency to post on its
Web site an annual audited financial statement that must (i) be a
complete set of financial statements of the clearing agency for the
most recent two fiscal years of the clearing agency and be prepared in
accordance with U.S. generally accepted accounting principles (``U.S.
GAAP''), except that for a clearing agency that is a corporation or
other organization incorporated or organized under the laws of any
foreign country, the financial statements may be prepared according to
U.S. GAAP or International Financial Reporting Standards as issued by
the International Accounting Standards Board (``IFRS''); (ii) be
audited in accordance with standards of the Public Company Accounting
Oversight Board by a registered public accounting firm that is
qualified and independent in accordance with Rule 2-01 of Regulation S-
X (17 CFR 210.2-01); and (iii) include a report of the registered
public accounting firm that complies with paragraphs (a) through (d) of
Rule 2-02 of Regulation S-X (17 CFR 210.2-02). The purpose of the
collection of information is to enable the Commission to monitor the
financial resources of clearing agencies that provide CCP services.

j. Transparent and Enforceable Rules and Procedures

    Rule 17Ad-22(d)(1) would require clearing agencies to establish,
implement, maintain and enforce written policies and procedures
reasonably designed to provide for a well-founded, transparent, and
enforceable legal framework for each aspect of their activities in all
relevant jurisdictions. The purpose of the collection of information is
to help ensure that clearing agencies' policies and procedures do not
cause confusion or legal uncertainty among their participants because
they are unclear, incomplete or conflict with other applicable laws or
judicial precedent.
    The Commission believes that 10 registered clearing agencies will
incur a total burden of approximately 8,029 hours annually.
    Written comments are invited on: (a) Whether the proposed
collection of information is necessary for the proper performance of
the functions of the agency, including whether the information shall
have practical utility; (b) the accuracy of the agency's estimate of
the burden of the proposed collection of information; (c) ways to
enhance the quality, utility, and clarity of the information on
respondents; and (d) ways to minimize the burden of the collection of
information on respondents, including through the use of automated
collection techniques or other forms of information technology.
Consideration will be given to comments and suggestions submitted in
writing within 60 days of this publication.
    An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information under the PRA unless it
displays a currently valid OMB control number.
    Please direct your written comments to: Pamela Dyson, Director/
Chief

Information Officer, Securities and Exchange Commission, c/o Remi
Pavlik-Simon, 100 F Street NE., Washington DC 20549, or send an email
to<EMAIL_ADDRESS>
    Dated: December 2, 2015.
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-30746 Filed 12-4-15; 8:45 am]
 BILLING CODE 8011-01-P