Federal Register, Volume 76 Issue 57 (Thursday, March 24, 2011)[Federal Register Volume 76, Number 57 (Thursday, March 24, 2011)]
[Proposed Rules]
[Pages 16587-16588]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-6972]
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COMMODITY FUTURES TRADING COMMISSION
17 CFR Part 39
RIN 3038-AC98
Risk Management Requirements for Derivatives Clearing
Organizations
AGENCY: Commodity Futures Trading Commission.
ACTION: Reopening of comment period.
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SUMMARY: The Commodity Futures Trading Commission (Commission) is
reopening the comment period for a proposed rule that would require
derivatives clearing organizations (DCOs) to report end-of-day
positions for each clearing member, by customer origin and house
origin, and for customer origin, separately, the gross positions of
each beneficial owner.
DATES: Submit comments on or before April 25, 2011.
ADDRESSES: You may submit comments, identified by RIN number 3038-AC98,
by any of the following methods:
Agency Web site, via its Comments Online process: http://comments.cftc.gov. Follow the instructions for submitting comments
through the Web site.
Mail: David A. Stawick, Secretary of the Commission,
Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st
Street, NW., Washington, DC 20581.
Hand Delivery/Courier: Same as mail above.
Federal eRulemaking Portal: http://www.Regulations.gov.
Follow the instructions for submitting comments.
Please submit comments by only one method.
All comments must be submitted in English, or if not, accompanied
by an English translation. Comments will be posted as received to
http://www.cftc.gov. You should submit only information that you wish
to make available publicly. If you wish the Commission to consider
information that may be exempt from disclosure under the Freedom of
Information Act (FOIA), a petition for confidential treatment of the
exempt information may be submitted according to the procedures
established in Sec. 145.9 of the Commission's regulations.\1\ The
Commission reserves the right, but shall have no obligation, to review,
pre-screen, filter, redact, refuse, or remove any or all of your
submission from http://www.cftc.gov that it may deem to be
inappropriate for publication, such as obscene language. All
submissions that have been redacted or removed that contain comments on
the merits of the rulemaking will be retained in the public comment
file and will be considered as required under the Administrative
Procedure Act and other applicable laws, and may be accessible under
FOIA.
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\1\ Commission regulations referred to herein are found at 17
CFR Ch. 1 (2010). They are accessible on the Commission's Web site
at http://www.cftc.gov.
FOR FURTHER INFORMATION CONTACT: Phyllis P. Dietz, Associate Director,
202-418-5449, [email protected], Jacob Preiserowicz, Attorney-Advisor,
202-418-5432, [email protected], Division of Clearing and
Intermediary Oversight, Commodity Futures Trading Commission, Three
Lafayette Centre, 1155 21st Street, NW., Washington, DC 20581; and Anne
C. Polaski, Special Counsel, 312-596-0575, [email protected], Division
of Clearing and Intermediary Oversight, Commodity Futures Trading
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Commission, 525 West Monroe Street, Chicago, Illinois 60661.
SUPPLEMENTARY INFORMATION: On July 21, 2010, President Obama signed the
Dodd-Frank Act.\2\ Title VII of the Dodd-Frank Act \3\ amended the
Commodity Exchange Act (CEA) \4\ to establish a comprehensive
regulatory framework to reduce risk, increase transparency, and promote
market integrity within the financial system. Section 725(c) of the
Dodd-Frank Act amended Section 5b(c)(2) of the CEA, which sets forth
core principles with which a DCO must comply to be registered and to
maintain registration as a DCO.\5\
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\2\ See Dodd-Frank Wall Street Reform and Consumer Protection
Act, Public Law 111-203, 124 Stat. 1376 (2010). The text of the
Dodd-Frank Act may be accessed at http://www.cftc.gov/LawRegulation/OTCDERIVATIVES/index.htm.
\3\ Pursuant to section 701 of the Dodd-Frank Act, Title VII may
be cited as the ``Wall Street Transparency and Accountability Act of
2010.''
\4\ 7 U.S.C. 1 et seq.
\5\ 7 U.S.C. 5b(c)(2).
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On December 16, 2010, the Commission approved for publication in
the Federal Register proposed regulations which, among other things,
would implement DCO Core Principle D (Risk Management) and would
establish a related reporting requirement under Core Principle J
(Reporting). More specifically, the Commission proposed Sec.
39.13(g)(8)(i) to establish customer ``gross margin'' requirements, and
proposed Sec. 39.19(c)(1)(iv) to establish related daily reporting
requirements. The proposed regulations were published for comment in
the January 20, 2011 issue of the Federal Register.\6\
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\6\ 76 FR 3698, Jan. 20, 2011.
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The Federal Register preamble explained that proposed Sec.
39.13(g)(8)(i)
[[Page 16588]]
would require a DCO to collect initial margin on a gross basis for each
clearing member's customer account equal to the sum of the initial
margin amounts that would be required by the DCO for each individual
customer within that account if each individual customer were a
clearing member. A DCO would not be permitted to net positions of
different customers against one another, but it could collect initial
margin for its clearing members' house accounts on a net basis.\7\
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\7\ 76 FR at 3706.
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Related to this customer gross margin requirement, the preamble
further explained as follows, that proposed Sec. 39.19(c)(1)(iv) would
require DCOs to report end-of-day positions for each clearing member,
by customer origin and house origin, and for customer origin,
separately, the gross positions of each beneficial owner:
The Commission recently proposed a new Sec. 39.19(c)(1)(iv)
under which a DCO would be required, on a daily basis, to report the
end-of-day positions for each clearing member, by origin. [footnote
reference to 75 FR at 78195] In connection with the proposed Sec.
39.13(g)(8)(i) requirement for DCOs to collect initial margin for
customer accounts on a gross basis, the Commission is proposing to
amend proposed Sec. 39.19(c)(1)(iv) to additionally require a DCO,
for the customer origin, to report the gross positions of each
beneficial owner.\8\
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\8\ Id.
It has come to the attention of the Commission that there was an
omission in the Federal Register publication of the proposed rule text
setting forth the requirement for end-of-day reporting of customer
positions by the gross positions of each beneficial owner. The text of
proposed Sec. 39.19(c)(1)(iv), which read ``End-of-day positions for
each clearing member, by customer origin and house origin'' should have
read, ``End-of-day positions for each clearing member, by customer
origin and house origin; and for customer origin, separately, the gross
positions of each beneficial owner.''
In order to provide an adequate opportunity for comment on this
reporting requirement, the Commission has determined to extend the
comment period for proposed Sec. 39.19(c)(1)(iv), as corrected
elsewhere in this issue of the Federal Register, until April 25, 2011.
Issued in Washington, DC, on March 17, 2011, by the Commission.
David A. Stawick,
Secretary of the Commission.
[FR Doc. 2011-6972 Filed 3-23-11; 8:45 am]
BILLING CODE 6351-01-P
Last Updated: March 24, 2011