Notice2025-06763
Self-Regulatory Organizations; ICE Clear Credit LLC; Notice of Filing of Proposed Rule Change Relating to ICC's Governance Playbook
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
April 21, 2025
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 90 Issue 75 (Monday, April 21, 2025)</title>
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[Federal Register Volume 90, Number 75 (Monday, April 21, 2025)]
[Notices]
[Pages 16709-16711]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-06763]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-102866; File No. SR-ICC-2025-006]
Self-Regulatory Organizations; ICE Clear Credit LLC; Notice of
Filing of Proposed Rule Change Relating to ICC's Governance Playbook
April 15, 2025.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of
1934,\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on
April 3, 2025, ICE Clear Credit LLC (``ICC'' or ``ICE Clear Credit'')
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 primarily by ICC. 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.
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I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change
The principal purpose of the proposed rule change is to revise the
ICC Governance Playbook (the ``Playbook''). These revisions do not
require any changes to the ICC Clearing Rules (the ``Rules'').\3\
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\3\ Capitalized terms used but not defined herein have the
meanings specified in the Treasury Policy or, if not defined
therein, the ICE Clear Credit Rules (the ``Rules'').
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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, ICC included statements
concerning the purpose of and basis for the proposed rule change,
security-based swap submission, or advance notice and discussed any
comments it received on the proposed rule change, security-based swap
submission, or advance notice. The text of these statements may be
examined at the places specified in Item IV below. ICC 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, the Proposed Rule Change
(a) Purpose
The amendments are intended to (i) provide for the establishment of
a Board level risk committee (the ``Board Risk Committee'') and (ii)
add the Board
[[Page 16710]]
approved fitness standards for serving as a Manager on the Board (the
``Manager Fitness Standard''). ICC believes that such revisions will
facilitate the prompt and accurate clearance and settlement of
securities transactions and derivative agreements, contracts, and
transactions for which it is responsible. ICC proposes to make such
changes effective following Commission approval of the proposed rule
change. The proposed revisions are described in detail as follows.
ICC proposes amending the Playbook to add references to the Board
Risk Committee which was recently formed by the Board. Section II of
the Playbook would be amended to add the new Board Risk Committee to
the existing chart summarizing ICC's governance structure. In addition,
Section IV of the Playbook would be revised to add the Board Risk
Committee to the list of ICC's primary governance committees.
Furthermore, Section IV.B. would be added to the Playbook to describe
the Board Risk Committee's purpose, its membership composition, the new
Board Risk Committee member administration procedures, the Board Risk
Committee meeting frequency, the Board Risk Committee performance
review process, and the documents relevant to the Board Risk Committee.
Proposed Section IV.B.(a). of the Playbook describes the Board Risk
Committee's purpose as assisting the Board in fulfilling its oversight
responsibilities with respect to risk management of ICC. Without
limiting the foregoing, the Board Risk Committee will oversee (i) risk
management models, systems, and processes used to identify and mange
systemic, market, credit, and liquidity risks at ICC and (ii) matters
that could materially affect the risk profile of ICC. Such section also
includes a cross reference to the Board Risk Committee charter.
As provided in proposed Section IV.B.(b). of the Playbook, the
Board Risk Committee is composed of at least five (5) members, a
majority of which must meet the Manager independence requirements.\4\
All members of the Board Risk Committee must be Managers. The Board
Risk Committee will always include representatives from the owners and
participants of ICC. Members of the Board Risk Committee are appointed
by the Board, subject to the written consent of ICC's parent entity \5\
(the ``Parent''), and one member of the Board Risk Committee will be
appointed by the Board as chairperson of the Board Risk Committee.
Furthermore, the Board and the Parent will ensure that the Board Risk
Committee is composed of suitable members to enable the Board Risk
Committee to discharge its duties effectively. Qualified members of the
Board Risk Committee are those, in the judgment of the Board and the
Parent, possess an appropriate mix of skills (including relevant
technical skills), experience, and knowledge of ICC. Such members shall
possess strong personal attributes, such as integrity and high ethical
standards, interpersonal skills, and sound judgement. Experience and
qualifications considered by the Board and Parent include financial
acumen (including financial, accounting, and auditing expertise),
general business experience, industry knowledge, diversity of
viewpoints, special business experience and expertise in an area
relevant to ICC.
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\4\ The independence of Managers is determined in accordance
with the requirements of each of the New York Stock Exchange listing
standards, the U.S. Securities Exchange Act of 1934 (the ``Act'')
(including Commission Rule 17Ad-25) and the Intercontinental
Exchange, Inc. Board of Director Governance Principles.
\5\ ICC's sole member and parent entity is ICE US Holding
Company L.P.
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The section describing the new Board Risk Committee member
administrative procedures provides an overview of the steps that will
be taken by the ICC legal department to onboard a new member of the
Board Risk Committee (e.g., updating distribution lists and updating
the permissions of such individual on the Diligent platform which is
used to distribute materials to the Board and other committees,
including the Board Risk Committee). The proposed revisions provides
that the Board Risk Committee will meet no less frequently than
quarterly. The proposed revisions also add a description of the Board
Risk Committee performance review process and procedures. Such
performance review process is conducted on an annual basis and includes
each member of the Board Risk Committee completing a self-evaluation
survey. The annual review process is designed to gather feedback on the
operation of the Board Risk Committee and solicit suggestions for
improvements, as well as provide a forum for the identification of
problems with respect to the performance of the Board Risk Committee.
Such process includes the compilation of a summary of the survey
responses received from the Board Risk Committee by the ICC legal
department, which are presented to the entire Board Risk Committee.
Such summary shall include disclosure of the minimum, maximum, and
average score for each survey item, as well as a summary of relevant
comments received throughout the process. The proposed process and
procedures for the Board Risk Committee annual performance review
process are fully analogous to the performance review processes
currently in place for the Board, the ICC Audit Committee, and the ICC
Nominating Committee. Lastly the revisions add information related to
relevant documents of the Board Risk Committee (e.g., meeting agendas,
minutes and meeting materials), noting that such relevant documents
will be maintained by the ICC legal department on their shared network
drive. With the proposed addition of Section IV.B. to the Playbook,
subsequent Section IV. subsections have been re-lettered.
In addition, ICC proposes to update Appendix 1 of the Playbook by
deleting the placeholder language and adding a copy of the Manager
Fitness Standards which were recently adopted by the ICC Nominating
Committee and approved by the Board.
The amendments would also update the revision history section to
the Playbook (i.e., Section VI.).
(b) Statutory Basis
ICE Clear Credit believes that the proposed amendments to the
Playbook 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.
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\6\ 15 U.S.C. 78q-1.
\7\ 15 U.S.C. 78q-1(b)(3)(F).
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The proposed amendments are designed to reflect the addition of the
Board Risk Committee to ICC's governance structure, consistent with
requirements of Commission Rule 17Ad-25. The amendments provide details
on the purpose of the Board Risk Committee and its composition. In
ICC's view, the amendments will enhance the overall risk management of
ICC by providing for a Board level committee focused on the risk
management of ICC and are therefore consistent with the prompt and
accurate clearance and settlement of securities transactions and
derivatives agreements, contracts and transactions, the safeguarding of
securities and funds which are in the custody or control of ICC or for
which
[[Page 16711]]
it is responsible, and the protection of investors and the public
interest in the operation of clearing services, within the meaning of
Section 17A(b)(3)(F) of the Act.\8\
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\8\ 15 U.S.C. 78q-1(b)(3)(F).
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The proposed amendments are also consistent with relevant
provisions of Rule 17Ad-22(e)(2) which provides that the ``covered
clearing agency shall establish, implement, maintain and enforce
written policies and procedures reasonably designed to, as applicable
[. . .] [p]rovide for governance arrangements that are [c]lear and
transparent'' \9\ and ``[c]onsider the interests of participants'
customers . . . and other relevant stakeholders of the covered clearing
agency''.\10\ The proposed amendments are intended to add a Board Risk
Committee to ICC's governance structure with the role of overseeing
risk management of ICC. As such, the Board Risk Committee is intended
to improve ICC's governance structure by adding a Board level committee
focused on the risk management of ICC. In ICC's view, the amendments to
the Playbook are therefore consistent with the requirements of Rule
17Ad-22(e)(2).\11\
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\9\ 17 CFR 240.17ad-22(e)(2)(i).
\10\ 17 CFR 240.17ad-22(e)(2)(vi).
\11\ 17 CFR 240.17ad-22(e)(2).
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The proposed amendments also are consistent with the relevant
provisions of Rule 17Ad-25(d) which provides that ``Each registered
clearing agency must establish a risk committee (or committees) of the
board to assist the board of directors in overseeing the risk
management of the registered clearing agency.'' \12\ The proposed
amendments add a Board Risk Committee (composed exclusively of Managers
of the Board) to ICC's governance structure with the role of assisting
the Board in fulfilling its oversight responsibilities with respect to
the risk management of ICC. In ICC's view, the amendments to the
Playbook are therefore consistent with the requirements of Rule 17Ad-
25(d).\13\
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\12\ 17 CFR 240.17ad-25(d).
\13\ Id.
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(B) Clearing Agency's Statement on Burden on Competition
ICE Clear Credit 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 add a Board Risk Committee. The amendments do not
otherwise change the rights and responsibilities of ICC or its market
participants. Accordingly, ICE Clear Credit does not believe the
amendments would affect the costs of clearing, the ability of market
participants to access clearing, or the market for clearing services
generally. Therefore, ICE Clear Credit does not believe the proposed
rule change imposes any burden on competition that is inappropriate in
furtherance of the purposes of the Act.
(C) Clearing Agency's Statement on Comments on the Proposed Rule Change
Received From Members, Participants or Others
Written comments relating to the proposed rule change have not been
solicited or received. ICC will notify the Commission of any written
comments received by ICC.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) by order approve or disapprove such proposed rule change, or
(B) institute proceedings to determine whether the proposed rule
change should be disapproved.
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 Comments
<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#d5a7a0b9b0f8b6bab8b8b0bba1a695a6b0b6fbb2baa3"><span class="__cf_email__" data-cfemail="d1a3a4bdb4fcb2bebcbcb4bfa5a291a2b4b2ffb6bea7">[email protected]</span></a>. Please include
file number SR-ICC-2025-006 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities and
Exchange Commission, 100 F Street NE, Washington, DC 20549.
All submissions should refer to file number SR-ICC-2025-006. 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="https://www.sec.gov/rules/sro.shtml">https://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
a.m. and 3 p.m. Copies of such filings will also be available for
inspection and copying at the principal office of ICE Clear Credit and
on ICE Clear Credit's website at <a href="https://www.ice.com/clear-credit/regulation">https://www.ice.com/clear-credit/regulation</a>.
Do not include personal identifiable information in submissions;
you should submit only information that you wish to make available
publicly. We may redact in part or withhold entirely from publication
submitted materials that is obscene or subject to copyright protection.
All submissions should refer to file number SR-ICC-2025-006 and should
be submitted on or before May 12, 2025.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\14\
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\14\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-06763 Filed 4-18-25; 8:45 am]
BILLING CODE 8011-01-P
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