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

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Published

November 15, 2022

Issuing agencies

Securities and Exchange Commission

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<title>Federal Register, Volume 87 Issue 219 (Tuesday, November 15, 2022)</title>
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[Federal Register Volume 87, Number 219 (Tuesday, November 15, 2022)]
[Notices]
[Pages 68556-68558]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-24768]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-96274; File No. SR-ICEEU-2022-022]

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

November 8, 2022.
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 October 28, 2022, 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)
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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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 GG of its Delivery Procedures to update
certain documentation, timing and other requirements relating to
delivery under ICE Futures Abu Dhabi Murban Crude Oil Futures Contracts
(``Murban Crude Oil Futures Contracts'').

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 GG of its Delivery
Procedures to clarify certain delivery specifications relating to
Murban Crude Oil Futures Contracts. The proposed changes include
amendments to the delivery timetable in respect of delivery of Murban
Crude Oil Futures Contracts to modify certain time periods to be more
consistent with underlying cash markets, at the request of market
participants, and to make other drafting clarifications and
improvements. Specifically, the amendments would extend the date by
which Buyers would be required to send the Clearing House and Seller
Delivery Range Nomination Form stating the Buyer's preferred three-
delay delivery range from the 5th calendar day of the month preceding
the Delivery Period (or the following day if such 5th calendar day is
not a Clearing Day) to the 25th calendar day prior to the first
calendar day of the delivery month. In practice, the change will extend
the deadline up to two days. In light of this extension, ICE Clear
Europe does not believe it is necessary to provide a further extension
if the relevant day is not a Clearing Day. The amendments would also
move the deadline to 14:00 LPT on the relevant day rather than 16:00
LPT. Such amendments are intended to align the deadline with that
specified for the cash market in the Abu Dhabi National Oil Company's
(ADNOC's) General Terms and Conditions for the Sale of Crude Oil/
Condensate and Liquefied Petroleum Gas (the ``ADNOC's GTCs'').\5\
Market participants have requested these changes to reduce the
operational burden on Buyers of having different deadlines for the
Murban Crude Oil Futures Contracts and the cash market. The timing
updates would also be reflected in the delivery documentation summary.
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\5\ ADNOC's General Terms and Conditions for the Sale of Crude
Oil/Condensate and Liquefied Petroleum Gas is available at the
following link: <a href="https://www.adnoc.ae/-/media/adnoc-v2/files/adnoc_crude-and-lpg_gtcs_january-2020-edition-final_v1.ashx?la=en&hash=C9551678CC5CBBBAB30DFE83A495800E8AD540A1">https://www.adnoc.ae/-/media/adnoc-v2/files/adnoc_crude-and-lpg_gtcs_january-2020-edition-final_v1.ashx?la=en&hash=C9551678CC5CBBBAB30DFE83A495800E8AD540A1</a>.
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The Clearing House also proposes to amend the delivery timetable to
change the timing the finalization of the loading programme for the
Delivery Period and the delivery range determination to the 15th
calendar day prior to the first calendar day of the Delivery Month and
the 15th calendar day prior to the first calendar cay of the Delivery
Month +1

[[Page 68557]]

Clearing Day, respectively. Such amendments are also intended to align
such timing with the timing specified in ADNOC's GTCs for the cash
market. Such updates are also intended to ease the delivery operational
burden on Sellers by harmonizing the delivery specifications applicable
to Murban Crude Oil Futures Contracts under Part GG of the Delivery
Procedure's with the requirements of ADNOC's GTCs in the cash market.
The amendments would also make certain drafting corrections and
clarifications. An incorrect reference in the delivery timetable to
delivery range nomination under Section 4 of Part GG has been removed
and a correct reference to vessel nomination has been added in the
appropriate section of the delivery timetable. Additionally, the
amendments would add to the portion of the delivery timetable that
discusses finalization of the delivery range determination that the
Terminal Operator would be able to shorten the delivery range from
three consecutive Terminal Loading Days to two consecutive Terminal
Loading Days at any time, provided that the Terminal Operator gives
notice to the Buyer, Seller and the Clearing House. This change is
consistent with the existing contractual specifications of the Murban
Crude Oil Futures Contracts.
Minor updates would be made to Section 4 of Part GG. The title
preceding the table in such section would be changed from ``ICE Murban
Crude Oil Delivery Vessel Nomination Table'' to ``ICE Murban Crude Oil
Vessel Nomination Table'', for consistency with other documentation.
Information regarding Clearing Days would also be removed from the
section as unnecessary since such deadlines are calculated using
calendar days and not Clearing Days.
Other typographical and similar corrections would be made
throughout Part GG.
(b) Statutory Basis
ICE Clear Europe believes that the proposed amendments to Part GG
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.
As discussed above, the proposed changes to Part GG of the Delivery
Procedures are designed to more closely align the timing for certain
delivery-related documentation and processes relating to Murban Crude
Oil Futures Contracts with the underlying cash market terms and
conditions. Other updates would be made to improve clarity and
readability. The amendments do not otherwise change the terms and
conditions of Murban Crude Oil Futures Contracts, and the contracts
will 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 certain
delivery specifications for Murban Crude Oil Futures Contracts relating
to the determination of delivery ranges and certain other documentation
and timing matters, consistent with the ADNOC's GTCs. 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 appropriately 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 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 amendments
are being adopted to update and clarify the delivery specifications in
Part GG of the Delivery Procedures in connection with Murban Crude Oil
Futures Contracts, and will not otherwise affect the contract. 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.

Written comments relating to the proposed amendment has 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.

[[Page 68558]]

Comments may be submitted by any of the following methods:

Electronic Comments

<bullet> Use the Commission's internet comment form (<a href="http://www.sec.gov/rules/sro.shtml">http://www.sec.gov/rules/sro.shtml</a>) or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#fd8f889198d09e9290909893898ebd8e989ed39a928b"><span class="__cf_email__" data-cfemail="ed9f988188c08e8280808883999ead9e888ec38a829b">[email&#160;protected]</span></a>. Please include
File Number SR-ICEEU-2022-022 on the subject line.

Paper Comments

<bullet> 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-2022-022. 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 (<a href="http://www.sec.gov/rules/sro.shtml">http://www.sec.gov/rules/sro.shtml</a>).
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 <a href="https://www.theice.com/clear-europe/regulation">https://www.theice.com/clear-europe/regulation</a>.
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-2022-022 and should be
submitted on or before December 6, 2022.
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\13\ 17 CFR 200.30-3(a)(12).

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2022-24768 Filed 11-14-22; 8:45 am]
BILLING CODE 8011-01-P

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