Notice2025-16576
Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by The Options Clearing Corporation Concerning the Execution of the Clearing Member Agreement and the Non-U.S. Clearing Member Agreement
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
August 29, 2025
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 90 Issue 166 (Friday, August 29, 2025)</title>
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[Federal Register Volume 90, Number 166 (Friday, August 29, 2025)]
[Notices]
[Pages 42289-42291]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-16576]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-103779; File No. SR-OCC-2025-012]
Self-Regulatory Organizations; The Options Clearing Corporation;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change by
The Options Clearing Corporation Concerning the Execution of the
Clearing Member Agreement and the Non-U.S. Clearing Member Agreement
August 26, 2025.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Exchange Act'' or ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice
is hereby given that on August 21, 2025, 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 primarily by OCC. OCC
filed the proposed rule change pursuant to Section 19(b)(3)(A) \3\ of
the Act and paragraph (f) of Rule 19b-4 \4\ thereunder, 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).
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I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change
This proposed rule change would remove the Officer's Certificate
and signature block in their entirety from the Clearing Member
Agreement and Non-U.S. Clearing Member Agreement, most recently filed
with the Commission as part of the Exhibit 5 to File No. SR-OCC-2025-
003,\5\ so that OCC may update the form of such Officer's Certificate
to reflect the availability of alternate means of providing the
required certification. No substantive changes to the rights and
obligations of the parties to the Clearing Member Agreement and Non-
U.S. Clearing Member Agreement are intended.
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\5\ See Exchange Act Release No. 102522 (Mar. 5, 2025), 90 FR
11770 (Mar. 11, 2025) (SR-OCC-2025-003).
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OCC filed proposed changes to the text of the Clearing Member
Agreement and Non-U.S. Clearing Member Agreement as Exhibits 5A and 5B,
respectively to File No. SR-OCC-2025-012. Material proposed to be added
is marked by underlining and material proposed to be deleted is marked
with strikethrough text.
The proposed rule change does not require any changes to the text
of OCC's By-Laws or Rules. All terms with initial capitalization that
are not otherwise defined herein have the same meaning as set forth in
the OCC By-Laws and Rules.\6\
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\6\ OCC's By-Laws and Rules can be found on OCC's public
website: <a href="https://www.theocc.com/Company-Information/Documents-and-Archives/By-Laws-and-Rules">https://www.theocc.com/Company-Information/Documents-and-Archives/By-Laws-and-Rules</a>.
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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, the Proposed Rule Change
1. Purpose
Background
OCC is the sole clearing agency for standardized equity options
listed on national securities exchanges registered with the Commission.
OCC also clears certain stock loan and futures transactions. OCC
provides clearing services to its Clearing Members that, in turn,
facilitate the clearing and settlement of their customer transactions
or proprietary transactions through OCC. More specifically, in its role
as a clearing agency, OCC guarantees the performance of its Clearing
Members for all transactions cleared by OCC by becoming the buyer to
every seller and the seller to every buyer (or the lender to every
borrower and the borrower to every lender, in the case of stock loan
transactions). OCC maintains various contracts, applications, forms,
and letters that provide detailed information relevant to Clearing
Members and are part of the legal foundation for OCC's relationship
with each Clearing Member. Among these documents are the Clearing
Member Agreement and Non-U.S. Clearing Member Agreement, which form
part of the contractual agreement between OCC and a Clearing Member and
provide OCC with authority to carry out critical tasks related to
clearing membership.
In February 2025, OCC filed an immediately effective rule change
with the Commission to, among other things, amend its Clearing Member
Agreement and Non-U.S. Clearing Member Agreement to include eligible
banks as a membership category to align the categories in these
agreements with those set out in existing OCC Rule 201.\7\
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\7\ See Exchange Act Release No. 102522, supra note 5.
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[[Page 42290]]
Proposed Changes
OCC now proposes to revise the Clearing Member Agreement and Non-
U.S. Clearing Member Agreement, which are provided as Exhibits 5A and
5B, respectively, to SR-OCC-2025-012, to remove the Officer's
Certificate and signature block in their entirety from the Clearing
Member Agreement and Non-U.S. Clearing Member Agreement.
The Clearing Member Agreement and Non-U.S. Clearing Member
Agreement each currently include an Officer's Certificate that must be
executed by a Clearing Member applicant and includes an express
certification that the applicant's board of directors has approved the
Clearing Member Agreement (or Non-U.S. Clearing Member Agreement) and
authorized the President or any Vice President of the applicant to
execute and deliver, in the name and behalf of the applicant, attested
by its Secretary or Assistant Secretary, the Clearing Member Agreement
(or Non-U.S. Clearing Member Agreement). The Officer's Certificate is
intended to assure OCC that an officer of a Clearing Member applicant
is duly authorized by the applicant to execute the respective agreement
and thereby bind the applicant by its terms as a Clearing Member of
OCC.
As OCC continues to consider new applicants seeking to become
Clearing Members, OCC now understands that certain applicants may have
different corporate governance practices that render it unnecessarily
duplicative for such applicants to complete the Officer's Certificate
in its current form. For example, OCC understands that the boards of
some corporate entities have already adopted resolutions that provide
authorization to the company's senior officer(s) to execute and bind
the company to agreements such as the Clearing Member Agreement. In
these cases, completing the Officer's Certificate would require the
applicant to convene its board of directors to adopt the resolution
provided therein even though the board of directors had already adopted
a resolution that authorizes an officer of the company to execute and
bind the company to the Clearing Member Agreement.
To accommodate these circumstances and increase the efficiency of
its membership application process, OCC intends to clarify that, to
provide a certification to OCC that the applicant's board of directors
has resolved to delegate sufficient authority to an officer of the
applicant to execute and deliver the Clearing Member Agreement (or Non-
U.S. Clearing Member Agreement), a Clearing Member applicant may
provide either (i) the form of the Officer's Certificate that is
expressly provided in the current Clearing Member Agreement (or Non-
U.S. Clearing Member Agreement) or (ii) an alternative form of
certification and documentation as OCC deems satisfactory to accomplish
the same ends.
Notwithstanding its previous inclusion in rule text filed with the
Commission, OCC does not consider the Officer's Certificate or
signature block to be a rule of the clearing agency within the meaning
of the Exchange Act \8\ or regulations thereunder. The form Officer's
Certificate and signature block themselves are not a material aspects
of the operation of the facilities of OCC or stated policies, practices
or interpretations that establishes or changes any standard, limit or
guideline with respect to (A) the rights, obligations, or privileges of
specified persons or persons associated with specified persons, or (B)
the meaning, administration, or enforcement of an existing rule.\9\ The
Officer's Certificate and signature block are forms used to execute the
Clearing Member Agreement or Non-U.S. Clearing Member Agreement, as
applicable. OCC has filed the Officer's Certificate and signature block
for the Clearing Member Agreement and Non-U.S. Clearing Member
Agreement, revised to reflect the availability of alternate means of
providing the required certification, as Exhibits 3A and 3B,
respectively, to File No. SR-OCC-2025-012.
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\8\ See 15 U.S.C. 78c(a)(27).
\9\ See 17 CFR 240.19b-4(a)(6).
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2. Statutory Basis
OCC believes the proposed rule change is consistent with Section
17A of the Exchange Act \10\ thereunder and the rules and regulations
thereunder applicable to a registered clearing agency. In particular,
Section 17A(b)(3)(F) of the Act \11\ requires, among other things, that
the rules of a clearing agency be designed to foster cooperation and
coordination with persons engaged in the clearance and settlement of
securities transactions and to remove impediments to and perfect the
mechanism of a national system for the prompt and accurate clearance
and settlement of securities transactions. OCC's relationship with its
Clearing Members is largely governed by OCC's By-Laws and Rules, which
become applicable to applicants that execute the Clearing Member
Agreement with OCC. The proposed rule change will provide greater
flexibility to applicants for clearing membership and eliminating the
potential for unnecessary duplicity in the manner in which certain
applicants may authorize the execution of a Clearing Member Agreement.
In doing so, the proposed rule change reduces unnecessary
administrative burdens on Clearing Member applicants while maintaining
consistency with OCC's current business and operational processes and
preserving the transparency of OCC's application process. For these
reasons, the proposed rule change is reasonably designed to foster
cooperation and coordination between OCC and prospective participants
and remove impediments to and perfect the mechanisms of the national
system for the clearance and settlement of listed options, among other
products that OCC clears, in accordance with Section 17A(b)(3)(F) of
the Act.\12\
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\10\ 15 U.S.C. 78q-1.
\11\ 15 U.S.C. 78q-1(b)(3)(F).
\12\ Id.
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(B) Clearing Agency's Statement on Burden on Competition
Section 17A(b)(3)(I) of the Act \13\ requires that the rules of a
clearing agency not impose any burden on competition not necessary or
appropriate in furtherance of the purposes of the Act. OCC does not
believe that the proposed rule change would impact or impose any burden
on competition. The proposed changes are administrative in nature and
do not materially change the content of the Clearing Member Agreement
and Non-U.S. Clearing Member Agreement. These changes will apply to all
applicants or existing Clearing Members equally and would not advantage
or disadvantage an existing Clearing Member or applicant over another
Clearing Member or applicant. Additionally, OCC believes that the
proposed rule change will streamline the application process and make
it easier for applicants, because unnecessary corporate governance
processes will be eliminated and the proposed changes remain consistent
with OCC's existing Rules and By-Laws. Accordingly, OCC does not
believe that this proposed rule change will impose a burden on
competition.\14\
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\13\ 15 U.S.C. 78q-1(b)(3)(I).
\14\ Notwithstanding its immediate effectiveness, implementation
of this rule change will be delayed until this change is deemed
certified under CFTC [sic] Regulation 40.6.
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[[Page 42291]]
(C) Clearing Agency's Statement on Comments on the Proposed Rule Change
Received From Members, Participants or Others
Written comments 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
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \15\ and paragraph (f) of Rule 19b-4 \16\
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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\15\ 15 U.S.C. 78s(b)(3)(A).
\16\ 17 CFR 240.19b-4(f).
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The proposal shall not take effect until all regulatory actions
required with respect to the proposal are completed.\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 Regulation 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 Comments
<bullet> Use the Commission's internet comment form (<a href="http://www.sec.gov/rules-regulations/self-regulatory-organization-rulemaking">http://www.sec.gov/rules-regulations/self-regulatory-organization-rulemaking</a>);
or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#4634332a236b25292b2b232832350635232568212930"><span class="__cf_email__" data-cfemail="1765627b723a74787a7a727963645764727439707861">[email protected]</span></a>. Please include
File Number SR-OCC-2025-012 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-OCC-2025-012. 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-regulations/self-regulatory-organization-rulemaking">https://www.sec.gov/rules-regulations/self-regulatory-organization-rulemaking</a>). Copies of such
filing will be available for inspection and copying at the principal
office of OCC and on OCC's website at <a href="https://www.theocc.com/Company-Information/Documents-and-Archives/By-Laws-and-Rules">https://www.theocc.com/Company-Information/Documents-and-Archives/By-Laws-and-Rules</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 material that is obscene or subject to copyright protection.
All submissions should refer to file number SR-OCC-2025-012 and
should be submitted on or before September 19, 2025.
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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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-16576 Filed 8-28-25; 8:45 am]
BILLING CODE 8011-01-P
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