Self-Regulatory Organizations; ICE Clear Credit LLC; Order Approving Proposed Rule Change Relating to the CDS Instrument On-Boarding Policies and Procedures

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<title>Federal Register, Volume 91 Issue 163 (Tuesday, August 25, 2026)</title>
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[Federal Register Volume 91, Number 163 (Tuesday, August 25, 2026)]
[Notices]
[Pages 54893-54895]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-17283]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-106167; File No. SR-ICC-2026-008]


Self-Regulatory Organizations; ICE Clear Credit LLC; Order 
Approving Proposed Rule Change Relating to the CDS Instrument On-
Boarding Policies and Procedures

August 20, 2026.

I. Introduction

    On June 26, 2026, ICE Clear Credit LLC (``ICC'') filed with the 
Securities

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and Exchange Commission (the ``Commission''), pursuant to Section 
19(b)(1) of the Securities Exchange Act of 1934 (the ``Act'') \1\ and 
Rule 19b-4 thereunder,\2\ a proposed rule change to revise the ICC CDS 
Instrument On-boarding Policies and Procedures (the ``Proposed Rule 
Change''). The Proposed Rule Change was published for comment in the 
Federal Register on July 13, 2026.\3\ The Commission has not received 
comments regarding the Proposed Rule Change. For the reasons discussed 
below, the Commission is approving the Proposed Rule Change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Self-Regulatory Organizations; ICE Clear Credit LLC; Notice 
of Filing of Proposed Rule Change Relating to the CDS Instrument On-
boarding Policies and Procedures, Exchange Act Release No. 105863 
(July 8, 2026), 91 FR 42983 (July 13, 2026) (File No. SR-ICC-2026-
008) (``Notice'').
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II. Description of the Proposed Rule Change

    ICC is registered with the Commission as a clearing agency for the 
purpose of clearing CDS contracts for its Clearing Participants.\4\ The 
ICC CDS Instrument On-boarding Policies and Procedures (the 
``Instrument On-boarding Policy'') provide an overview of ICC's on-
boarding process for new instruments, which includes selecting new 
instruments for clearing, configuring internal systems, notifying and 
receiving feedback from stakeholders, and ensuring operational 
readiness by ICC and its Clearing Participants.\5\ The Proposed Rule 
Change would amend the Instrument On-boarding Policy's guiding 
principles that ICC maintains for instrument selection.
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    \4\ Capitalized terms not otherwise defined herein have the 
meanings assigned to them in ICC's Clearing Rules or the Instrument 
On-boarding Policy, as applicable. The Rules are available at 
<a href="https://www.ice.com/clear-credit/regulation">https://www.ice.com/clear-credit/regulation</a>.
    \5\ Notice, 91 FR at 42984.
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    ICC proposes to amend Section III.A. of the Instrument On-boarding 
Policy, which discusses the guiding principles that ICC maintains for 
considering instruments for clearing. These principles are designed to 
ensure that ICC proceeds in a prudent manner with respect to instrument 
selection while also providing the best opportunity for Clearing 
Participants to minimize their risk.
    Currently under Section III.A, ICC considers for clearing 
instruments that among other things are not constituents of currently 
clearable indices but meet certain other criteria. ICC proposes to 
amend this guiding principle. Currently, under this guiding principle, 
ICC considers instruments for clearing (i) with uncleared gross 
notional open interest among ICC's Clearing Participants, or with an 
average bilateral weekly volume equal to or greater than the average 
cleared volume across currently cleared instruments belonging to the 
same product type over the last twelve months or (ii) with bilateral 
open interest held by at least three Affiliate Groups of Clearing 
Participants.
    The Proposed Rule Change would introduce a third criterion to this 
guiding principle. ICC proposes to also consider for clearing 
instruments that are not constituents of currently clearable indices 
but that are single name instruments with reference entities with 
minimum outstanding debt notional of 500 million U.S. Dollars or Euros.
    To further emphasize that an instrument considered under this 
guiding principle needs only to satisfy one of the criteria or sub-
bullets specified in the ICC On-boarding Policy to be considered for 
clearing, ICC proposes to revise the punctuation by replacing periods 
in the first two criteria with semi-colons and adding ``or'' before the 
third criteria. ICC states that instruments subject to the amended 
guiding principles would continue to be subject to effective controls 
through existing governance, risk, pricing, and operations reviews, 
which ultimately determine the instruments that ICC may clear.\6\
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    \6\ Notice, 91 FR at 42984.
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III. Discussion

    Section 19(b)(2)(C) of the Act directs the Commission to approve a 
proposed rule change of a self-regulatory organization if it finds that 
the proposed rule change is consistent with the requirements of the Act 
and the rules and regulations thereunder applicable to such 
organization.\7\ Under the Commission's Rules of Practice, the ``burden 
to demonstrate that a proposed rule change is consistent with the Act 
and the rules and regulations issued thereunder . . . is on the self-
regulatory organization [`SRO'] that proposed the rule change.'' \8\
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    \7\ 15 U.S.C. 78s(b)(2)(C).
    \8\ Rule 700(b)(3), Commission Rules of Practice, 17 CFR 
201.700(b)(3).
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    The description of a proposed rule change, its purpose and 
operation, its effect, and a legal analysis of its consistency with 
applicable requirements must all be sufficiently detailed and specific 
to support an affirmative Commission finding,\9\ and any failure of an 
SRO to provide this information may result in the Commission not having 
a sufficient basis to make an affirmative finding that a proposed rule 
change is consistent with the Act and the applicable rules and 
regulations.\10\ Moreover, ``unquestioning reliance'' on an SRO's 
representations in a proposed rule change is not sufficient to justify 
Commission approval of a proposed rule change.\11\
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    \9\ Id.
    \10\ Id.
    \11\ Susquehanna Int'l Group, LLP v. Securities and Exchange 
Commission, 866 F.3d 442, 447 (D.C. Cir. 2017) (``Susquehanna'').
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    After carefully considering the Proposed Rule Change, the 
Commission finds that the Proposed Rule Change is consistent with the 
requirements of the Act and the rules and regulations thereunder 
applicable to ICC. Specifically, the Commission finds that the proposal 
is consistent with Section 17A(b)(3)(F) of the Act \12\ and Rule 17ad-
22(e)(1) thereunder,\13\ as described in detail below.
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    \12\ 15 U.S.C. 78q-1(b)(3)(F).
    \13\ 17 CFR 240.17ad-22(e)(1).
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A. Consistency With Section 17A(b)(3)(F) of the Act

    Under Section 17A(b)(3)(F) of the Act, ICC's rules, among other 
things, must be ``designed to promote the prompt and accurate clearance 
and settlement of securities transactions and . . . to assure the 
safeguarding of securities and funds which are in the custody or 
control of the clearing agency or for which it is responsible . . . .'' 
Based on a review of the record, and for the reasons discussed below, 
the Proposed Rule Change is consistent with Section 17A(b)(3)(F).
    As discussed above, ICC is proposing to add a third criterion for 
instrument selection so that single name instruments with reference 
entities having a minimum outstanding debt notional of $500MM or 
[euro]500MM may be considered for clearing, even if the instrument is 
not a constituent of a currently clearable index. By expanding the 
universe of instruments eligible for consideration under the guiding 
principles, the Proposed Rule Change enhances ICC's ability to offer 
clearing for a broader range of CDS instruments, thereby promoting the 
prompt and accurate clearance and settlement of instruments for which 
ICC is responsible. Instruments considered for clearing under the 
amended guiding principles remain subject to ICC's existing governance, 
risk, pricing, and operations reviews, which serve as effective 
controls to ensure that only appropriate instruments are admitted to 
clearing, thereby safeguarding the securities and funds in ICC's 
custody or control. By potentially allowing

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Clearing Participants to centrally clear additional transactions and 
mitigating risk for ICC and its Clearing Participants, the Proposed 
Rule Change promotes the prompt and accurate clearance and settlement 
of securities transactions and assures the safeguarding of securities 
and funds in ICC's custody and control.
    As discussed above, the Proposed Rule Change also would clarify the 
On-boarding Policy by revising the punctuation by replacing periods in 
the first two criteria with semi-colons and adding ``or'' before the 
third criterion. A clearer On-boarding Policy helps lower the chance 
that there are any delays or disruptions to the instrument on-boarding 
process. Given the smoother process, these proposed changes promote the 
prompt and accurate clearance and settlement of securities 
transactions.
    The Proposed Rule Change therefore facilitates the expansion of 
clearing services in a manner that supports market efficiency and 
preserves the integrity of ICC's risk management framework. 
Accordingly, the Proposed Rule Change is consistent with Section 
17A(b)(3)(F) of the Act.\14\
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    \14\ Id.
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B. Consistency With Rule 17Ad-22(e)(1)

    Rule 17Ad-22(e)(1) requires ICC to establish, implement, maintain, 
and enforce written policies and procedures reasonably designed to 
provide for a well-founded, clear, transparent, and enforceable legal 
basis for each aspect of its activities in all relevant 
jurisdictions.\15\
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    \15\ 17 CFR 240.17Ad-22(e)(1).
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    The proposed rule change would help provide a well-founded, clear, 
transparent, and enforceable legal basis for ICC's clearance of 
additional instruments. The proposed amendments to the On-boarding 
Policy advance these objectives by codifying an additional, clearly 
defined quantitative criterion. As discussed above, the proposed rule 
change would allow single name instruments to be considered for 
clearing, even if they are not constituents of a currently clearable 
index, where their reference entities have a minimum outstanding debt 
notional threshold of $500MM or [euro]500MM. By memorializing this 
criterion in written policy, ICC enhances the transparency and clarity 
of its instrument selection framework, ensuring that the On-boarding 
Policy is well-founded and enforceable. Furthermore, the proposed 
structural revisions to the punctuation and organization of the sub-
bullets further reinforce the transparent and unambiguous application 
of the guiding principles, leaving no uncertainty as to how instruments 
may qualify for clearing consideration under this provision.
    The Proposed Rule Change therefore provides a well-founded, clear, 
transparent, and enforceable legal basis for ICC to clear additional 
instruments. Accordingly, the Proposed Rule Change is consistent with 
Rule 17Ad-22(e)(1).\16\
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    \16\ 15 U.S.C. 78q-1(b)(3)(F).
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IV. Conclusion

    On the basis of the foregoing, the Commission finds that the 
proposed rule change is consistent with the requirements of the Act, 
and in particular, with the requirements of Section 17A(b)(3)(F) of the 
Act \16\ and Rule 17ad-22(e)(1) thereunder.\17\
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    \17\ 17 CFR 240.17ad-22(e)(1).
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    It is therefore ordered, pursuant to Section 19(b)(2) of the Act 
\18\ that the proposed rule change (SR-ICC-2026-008) be, and hereby is, 
approved.\19\
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    \18\ 15 U.S.C. 78s(b)(2).
    \19\ In approving the proposed rule change, the Commission 
considered the proposal's impact on efficiency, competition, and 
capital formation. 15 U.S.C. 78c(f).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\20\
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    \20\ 17 CFR 200.30-3(a)(12).
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Vanessa A. Countryman,
Secretary.
[FR Doc. 2026-17283 Filed 8-24-26; 8:45 am]
BILLING CODE 8011-01-P


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