TriOptima AB; Notice of Filing of Application for Exemption From Registration as a Clearing Agency Under Section 17A of the Securities Exchange Act of 1934

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<title>Federal Register, Volume 91 Issue 167 (Monday, August 31, 2026)</title>
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[Federal Register Volume 91, Number 167 (Monday, August 31, 2026)]
[Notices]
[Pages 55921-55923]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-17673]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-106202; File No. 600-43]


TriOptima AB; Notice of Filing of Application for Exemption From 
Registration as a Clearing Agency Under Section 17A of the Securities 
Exchange Act of 1934

August 26, 2026.

I. Introduction

    On August 9, 2024, TriOptima AB (``TriOptima'') filed with the 
Securities and Exchange Commission (``Commission'') an application on 
Form CA-1 (``Application'') seeking an exemption from registration as a 
clearing agency pursuant to Section 17A of the Securities Exchange Act 
of 1934 (``Exchange Act'') and Rule 17Ab2-1 thereunder.\1\ In its 
Application, TriOptima states that it is requesting an exemption from 
clearing agency registration in connection with certain post-trade risk 
reduction services for transactions in security-based swaps (``SBS'') 
offered through its triReduce and triBalance services.\2\ TriOptima 
also requests that the exemption be applied to its planned expansion of 
these services to cover transactions in repurchase and reverse 
repurchase agreements involving any type of underlying securities 
(``Repo Products''), including U.S. Treasury securities.\3\
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    \1\ 15 U.S.C. 78q-1; 17 CFR 240.17ab2-1 (``Rule17Ab2-1'').
    \2\ Application, Exhibit S-1. TriOptima subsequently amended its 
application on December 11, 2024, in 2025 on January 6, November 26, 
and December 22, and in 2026 on February 13. The non-confidential 
exhibits of its application are available for viewing on the 
Commission's website at <a href="https://www.sec.gov/rules-regulations/commission-orders-notices/other-commission-orders-notices-information">https://www.sec.gov/rules-regulations/commission-orders-notices/other-commission-orders-notices-information</a>. On August 5, 2026, TriOptima amended its application by 
letter, explaining that, over the next 12 months, certain product 
names will change because its parent company has relinquished 
certain naming rights, including use of the words ``Markit'' and 
``Serv.'' OSTTRA Group, on behalf of TriOptima, explains that, 
although not directly affected by this change, in Q4 2026 the 
``triReduce'' service will be renamed ``OSTTRA Reduce'' and the 
``triBalance'' service will be renamed ``OSTTRA ReBalance.'' It also 
explains that these changes are strictly a renaming exercise and 
introduce no changes to technical architecture, risk controls, or 
operational support. See Letter from Michelle Hallet, Head of 
Compliance, OSTTRA, dated August 5, 2026.
    \3\ Application, Exhibit S-1.
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    The Commission is publishing this notice to solicit comments from 
interested persons on the Application. The Commission will consider any 
comments it receives in making its determination whether to grant 
TriOptima's request for an exemption from registration as a clearing 
agency.\4\
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    \4\ Because the Application seeks an exemption from 
registration, the timing requirements in Section 19(a) of the 
Exchange Act do not apply. See 15 U.S.C. 78q-1(b)(2) (applying the 
provisions of Section 19(a) to applications for registration but not 
applications for an exemption from registration).
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II. Background

    TriOptima has been providing the services described in Part III of 
this notice pursuant to a temporary, class-based exemption issued by 
the Commission in 2011 (``2011 Temporary Exemption'').\5\ Specifically, 
the 2011 Temporary Exemption provided exemptive relief to entities 
performing (non-central counterparty) post-trade services for SBS that 
otherwise would have to register as a clearing agency or obtain an 
exemption from registration.\6\ In adopting Regulation SE in 2023, the 
Commission terminated the 2011 Temporary Exemption, while extending its 
exemptive relief to entities that applied for registration or an 
exemption from registration as a clearing agency.\7\ Pursuant to the 
terms set forth in the Regulation SE adopting release, TriOptima has 
continued to provide the services described below.\8\
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    \5\ See Order Pursuant to Section 36 of the Securities Exchange 
Act of 1934 Granting Temporary Exemptions from Clearing Agency 
Registration Requirements under Section 17A(b) of the Exchange Act 
for Entities Providing Certain Clearing Services for Security-Based 
Swaps, Release No. 34-64796 (July 1, 2011), 76 FR 39963 (July 7, 
2011).
    \6\ See 2011 Temporary Exemption, 76 FR at 39964.
    \7\ See Security-Based Swap Execution and Registration and 
Regulation of Security-Based Swap Execution Facilities, Release No. 
34-98845 (Nov. 2, 2023), 88 FR 87156, 87229 (Dec. 15, 2023) 
(``Regulation SE'') (stating that ``[f]or any entity currently 
relying on the 2011 Clearing Agency Exemption that becomes required 
to register as a clearing agency, the exemptive relief will 
terminate 180 days after the Effective Date of Regulation SE, which 
will be 60 days after the date of publication in the Federal 
Register, except that (1) with respect to an entity that has filed 
an application to register as a clearing agency with the Commission 
on Form CA-1 within 180 days of the Effective Date of Regulation SE, 
the relief will terminate 240 days after the Effective Date of 
Regulation SE; and (2) with respect to an entity that has filed an 
application on Form CA-1 within 180 days after the Effective Date of 
Regulation SE and whose application on Form CA-1 is complete (having 
responded to requests by the Commission's staff for revisions or 
amendments) within 240 days after the effective date, the exemptive 
relief will terminate 30 days after the Commission acts to approve 
or disapprove the application on Form CA-1.'').
    \8\ See Regulation SE, 88 FR at 87229; see also Application, 
Exhibit J, at 1, and Exhibit S-1.
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III. Summary of TriOptima's Organization and Services

A. Organization

    Orion ELP LP, which is owned by funds and other vehicles controlled 
by KKR, is the ultimate parent of TriOptima.\9\ TriOptima is 
incorporated as a private limited company in Stockholm and has branches 
in the United Kingdom and in Singapore.\10\ TriOptima also has four 
subsidiaries, each of which provide services to TriOptima in the form 
of client relationship management, sales, and marketing activities.\11\ 
All clients of TriOptima services enter into contractual arrangements 
only with TriOptima, the applicant.\12\
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    \9\ See Application, Exhibits D and D-1. This change in 
ownership was reflected in an amendment filed on December 22, 2025.
    \10\ The Application explains that these branches are not 
involved with the services that constitute the clearing agency 
functions. See Application, Exhibit D, at 2.
    \11\ The subsidiaries are TriOptima North America LLC, TriOptima 
UK Limited, TriOptima Asia Pacific Pte LTD, OSTTRA Japan KK. The 
Application explains that the purpose of the subsidiaries is to 
provide global coverage via the so-called ``follow the sun'' model. 
See Application, Exhibit D, at 2.
    \12\ Id.
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B. Description of Services

    In its Application, TriOptima explains that offers the triReduce 
and triBalance services to enable financial institutions to reduce 
risks in their non-cleared and cleared portfolios of positions in 
various derivative products, including SBS.\13\ Customers of the 
services include SBS dealers, inter-dealer brokers, prime brokers, and 
institutional buy-side firms. As stated above, in addition to serving 
the SBS market, TriOptima proposes in its Application to expand its 
service offerings to include Repo Products, including for U.S. Treasury 
securities. Below is a description of each of the triReduce and 
triBalance services.
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    \13\ See Application, Exhibit J, at 2, and Exhibit S-1.
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1. triReduce
    triReduce, a portfolio compression service, is a web-based service 
that enables multilateral and multi-contract early termination of 
cleared and uncleared OTC derivatives (primarily interest rate swaps, 
cross currency swaps, inflation swaps, credit default swaps and FX 
forwards).\14\ TriOptima

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offers the triReduce service to banks and investment firms. In its 
Application, TriOptima explains that its service helps market 
participants eliminate unnecessary line items and notional principal 
outstanding for both cleared and uncleared OTC derivatives, helping to 
manage counterparty risk and achieve compliance with Basel III 
liquidity requirements.\15\ TriOptima states that, by removing 
unnecessary, outstanding transaction from their portfolios, market 
participants can eliminate costs and credit and operational risk, and 
thereby reduce their capital requirements.\16\
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    \14\ See Application, Exhibit S-1, at 5.
    \15\ See id, at 4.
    \16\ See id.
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    The triReduce process involves subscribers and any adhering parties 
taking the following steps in relation to the creation of each 
``unwind'' proposal:
    1. Signing up to an appropriate contractual framework to facilitate 
the early termination/revision/replacement of transactions;
    2. Trade linking (the input of trades between subscribers/adhering 
parties or a clearing house, as applicable, in the unwind process);
    3. Establishment of subscribers' tolerances (subscribers setting 
the parameters of the unwind proposal, or to put it another way, the 
tolerances set by each subscriber within which an unwind proposal must 
fit);
    4. Unwind proposal generation (creating the unwind proposal in 
accordance with the subscribers' tolerances); and
    5. Contract formation between the subscribers/adhering parties or a 
clearing house, as applicable.\17\
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    \17\ See id, at 6.
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2. triBalance
    triBalance, a portfolio rebalancing service, is a web-based service 
that enables multilateral and multi-contract rebalancing of 
counterparty risk exposures of OTC derivatives portfolios. In its 
Application, TriOptima explains that the triBalance service is used to 
rebalance bilateral and cleared outstanding risk exposures. As 
explained in its Application, the triBalance service seeks to mitigate 
the outstanding exposures by proposing new bilateral transactions that 
are added to existing netting sets to offset outstanding risk 
exposures.\18\ TriOptima states that the triBalance service helps 
market participants reduce credit risk exposure by identifying 
transactions to rebalance counterparty risk exposures across a 
participant's counterparties for non-cleared positions and central 
counterparties while maintaining an unchanged market risk position 
within small pre-defined tolerances as set by the subscriber.\19\
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    \18\ See Application, Exhibit J, at 1.
    \19\ See Application, Exhibit S-1, at 4.
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    The triBalance process involves the following steps:
    1. Signing up to an appropriate contractual framework;
    2. Submission of subscribers' relevant outstanding risk exposures;
    3. Submission of subscribers' tolerances; and
    4. triBalance proposal generation.\20\
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    \20\ See id, at 7.
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    In addition to its current product offerings, TriOptima in its 
Application describes plans to offer triBalance to clients and 
prospective clients with respect to their Repo Product portfolios of 
cleared positions and uncleared positions, including both tri-party and 
bilateral transactions. Repo Product portfolios may include cash market 
transactions in the types of securities underlying the Repo Products. 
In its Application, TriOptima explains that the output of a rebalancing 
(or ``optimization''), for a Repo Product portfolio may include 
proposals to execute securities transactions to rebalance the 
portfolio.\21\
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    \21\ See id. at 8.
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IV. Statutory Standard

    Section 17A(b)(1) of the Exchange Act requires any clearing agency 
to register with the Commission before performing the functions of a 
clearing agency with respect to any security (other than an exempted 
security).\22\ Section 17A(b)(1) of the Exchange Act also provides 
that, by rule or order, upon its own motion or upon application, the 
Commission may conditionally or unconditionally exempt a clearing 
agency from any provisions of Section 17A or the rules or regulations 
thereunder if the Commission finds that such exemption is consistent 
with the public interest, the protection of investors, and the purposes 
of Section 17A, including the prompt and accurate clearance and 
settlement of securities transactions and the safeguarding of 
securities and funds.\23\
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    \22\ See 15 U.S.C. 78q-1(b)(1); 17 CFR 240.17ab2-1.
    \23\ See 15 U.S.C. 78q-1(b)(1).
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V. Request for Exemption

    TriOptima has requested that the Commission grant an exemptive 
order pursuant to which it may continue to provide the triReduce and 
triBalance services as to SBS transactions, and to provide the 
triBalance service for Repo Products once the activity with respect to 
these products expands beyond a de minimis volume of activity.\24\ In 
relation to its request for Repo Products, TriOptima explains that it 
expects activity with respect to these products to be de minimis until 
at least June 2027.\25\ In its Application, TriOptima requests that the 
exemption apply to enhancements to the triReduce and triBalance 
services, as well as expansion to any additional SBS products in the 
future, beyond those described in the Application.\26\
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    \24\ See Application, Exhibit S-1.
    \25\ See Application, Exhibit S-1, at 2.
    \26\ See id. at 12.
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A. Application of Statutory Standard

    TriOptima explains in its request that the Commission may exempt a 
person from registering as a clearing agency if the Commission 
determines that granting the exemption is consistent with the public 
interest, the protection of investors, and the policy goals of Section 
17A.\27\ TriOptima also describes factors that the Commission 
previously has applied in granting exemptive relief, including: (i) 
prompt and accurate clearance and settlement of securities 
transactions, and the safeguarding of securities and funds; (ii) 
facilitating development and expansion of support services to reduce 
risk; and (iii) reducing unnecessary costs.\28\
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    \27\ See id. at 11.
    \28\ See id.
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    According to TriOptima, the Commission has consistently found that 
exemption from registration is appropriate where such exemption 
promotes a safe and efficient clearance and settlement system.\29\ 
TriOptima states that the services further the objectives of Section 
17A of the Exchange Act by providing ``tools for SBS market 
participants to manage and reduce risks inherent in the portfolios of 
open non-cleared and cleared positions in derivatives, including SBS.'' 
\30\ As explained further in the Application, TriOptima states that the 
triReduce service enables market participants to reduce the gross 
notional exposure of their portfolios and to terminate or amend 
unnecessary or duplicative transactions, and that the triBalance 
service allows market participants to optimize and mitigate 
counterparty credit risk without changing overall market risk on the 
portfolio, enabling users to reinvest capital and reduce the gross 
value of outstanding contracts. TriOptima states that such services 
promote market stability and efficient usage of capital.
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    \29\ See id, at 8.
    \30\ See id. at 12.

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    Additionally, TriOptima explains that requiring it to register as 
clearing agencies and to comply with the full set of obligations 
applicable to registered clearing agencies under the Exchange Act would 
increase the costs to provide its services ``without any attendant 
benefit'' and would ``serve only to increase the operating costs of the 
applicant, and thus the costs on market participants.'' \31\ TriOptima 
also states that it does not, and for Repo Products would not, hold any 
customer assets, manage or direct any customer collateral, manage 
margin requirements, or match executions.\32\ Finally, TriOptima 
explains that it maintains systems and controls that promote the public 
interest and are generally in accordance with industry best 
practices.\33\
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    \31\ See id. at 13.
    \32\ See id.
    \33\ See id.
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B. Conditions to Exemption

    In support of the request for an exemption from registration, 
TriOptima sets forth conditions with which it would comply if its 
request for an exemption from registration is granted. Specifically, 
TriOptima agrees to: (1) provide the Commission with information on any 
material changes to the clearing agency services that are the subject 
of the exemption; (2) allow the Commission to inspect its facilities 
where such clearing agency functions are performed and where related 
records are maintained; and (3) make periodic disclosures to the 
Commission regarding its operations as required or requested by the 
Commission.\34\
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    \34\ See Application, Exhibit S-1.
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VI. Request for Written Comments

    Interested persons are invited to provide written data, views, and 
arguments concerning the Application, including whether the proposed 
exemption is consistent with the public interest, the protection of 
investors, and the purposes of Section 17A of the Exchange Act. To the 
extent possible, commenters are requested to provide empirical data and 
other factual support for their views. In addition, the Commission 
seeks comment generally on the following questions relevant to the 
consideration of the Application:
    1. Since the Commission issued the 2011 Temporary Exemption, has 
TriOptima provided clearing agency services and operated consistent 
with the public interest, the protection of investors, and the purposes 
of the Exchange Act? Why or why not? To what extent has TriOptima's 
provision of clearing agency services affected the ongoing development 
of the national system for clearance and settlement?
    2. What operational or other risks, if any, do the triBalance and 
triReduce services pose to their respective customers or to clearing 
agencies with which they interact? Does TriOptima's proposed conditions 
sufficiently address any such risks? Please explain.
    3. Are TriOptima's proposed conditions consistent with the public 
interest, the protection of investors, and the purposes of Section 17A 
of the Exchange Act, including the prompt and accurate clearance and 
settlement of securities transactions and the safeguarding of 
securities and funds? Would any revisions to the proposed conditions 
better promote the purposes of Section 17A of the Exchange Act? Why or 
why not? If so, which conditions should be modified? Should any 
conditions be added? Why or why not?
    4. Are TriOptima's proposed conditions designed to promote 
innovation and to facilitate competition among service providers?
    5. Are there any aspects of the services provided by TriOptima or 
proposed to be provided by TriOptima that would support applying 
Commission rules such as Regulation SCI or the recordkeeping 
requirements for registered clearing agencies under 17 CFR 240.17a-1? 
If so, which rules and why?
    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-regulations/how-submit-comment">https://www.sec.gov/rules-regulations/how-submit-comment</a>); or
    <bullet> Send an email to <a href="/cdn-cgi/l/email-protection#1f6d6a737a327c7072727a716b6c5f6c7a7c31787069"><span class="__cf_email__" data-cfemail="85f7f0e9e0a8e6eae8e8e0ebf1f6c5f6e0e6abe2eaf3">[email&#160;protected]</span></a>. Please include 
File Number 600-43 on the subject line.

Paper Comments

    <bullet> Send paper comments to Secretary, Securities and Exchange 
Commission, 100 F Street NE, Washington, DC 20549-1090. All submissions 
should refer to File Number 600-43.

To help the Commission process and review your comments more 
efficiently, please use only one method of submission. The Commission 
will post all comments on the Commission's internet website (<a href="https://www.sec.gov/rules-regulations/commission-orders-notices/other-commission-orders-notices-information">https://www.sec.gov/rules-regulations/commission-orders-notices/other-commission-orders-notices-information</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 600-43 and should be submitted on or before 
October 15, 2026.
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    \35\ 17 CFR 200.30-3(a)(16).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\35\
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-17673 Filed 8-28-26; 8:45 am]
BILLING CODE 8011-01-P


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