60 Day Notice

Federal Register / Vol. 89, No. 175 / Tuesday, September 10, 2024 / Notices
only one method. The Commission will
post all comments on the Commission’s
internet website (https://www.sec.gov/
rules/sro.shtml). 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 the filing also
will be available for inspection and
copying at the principal office of the
Exchange. 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–NYSE–2024–47 and should be
submitted on or before October 1, 2024.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.7
Vanessa A. Countryman,
Secretary.
[FR Doc. 2024–20321 Filed 9–9–24; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–139, OMB Control No.
3235–0128]

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Proposed Collection; Comment
Request; Reinstatement With Change:
Rule 12f–1
Upon Written Request, Copies Available
From: Securities and Exchange
Commission, Office of FOIA Services,
100 F Street NE, Washington, DC
20549–2736
Notice is hereby given that pursuant
to the Paperwork Reduction Act of 1995
(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the
Securities and Exchange Commission
(‘‘Commission’’) is soliciting comments
on the existing collection of information
provided for in Rule 12f–1 (17 CFR
240.12f–1), under the Securities
Exchange Act of 1934 (‘‘Act’’) (15 U.S.C.
7 17

CFR 200.30–3(a)(12).

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78a et seq.). The Commission plans to
submit this existing collection of
information to the Office of
Management and Budget (‘‘OMB’’) for
reinstatement and approval.
Rule 12f–1 (‘‘Rule’’), originally
adopted in 1979 pursuant to Sections
12(f) and 23(a) of the Act, and as further
modified in 1995 and 2005, sets forth
the requirements for filing an exchange
application to reinstate unlisted trading
privileges (‘‘UTP’’) in a security in
which UTP has been suspended by the
Commission pursuant to Section
12(f)(2)(A) of the Act. Under Rule 12f–
1, an exchange must submit one copy of
an application for reinstatement of UTP
to the Commission that contains
specified information, as set forth in the
Rule. The application for reinstatement,
pursuant to the Rule, must provide the
name of the issuer, the title of the
security, the name of each national
securities exchange, if any, on which
the security is listed or admitted to
unlisted trading privileges, whether
transaction information concerning the
security is reported pursuant to an
effective transaction reporting plan
contemplated by Rule 601 of Regulation
NMS, the date of the Commission’s
suspension of unlisted trading
privileges in the security on the
exchange, and any other pertinent
information related to whether the
reinstatement of UTP in the subject
security is consistent with the
maintenance of fair and orderly markets
and the protection of investors. Rule
12f–1 further requires a national
securities exchange seeking to reinstate
its ability to extend unlisted trading
privileges in a security to indicate that
it has provided a copy of such
application to the issuer of the security,
as well as to any other national
securities exchange on which the
security is listed or admitted to unlisted
trading privileges.
The information required by Rule
12f–1 enables the Commission to make
the necessary findings under the Act
prior to granting applications to
reinstate unlisted trading privileges.
This information is also made available
to members of the public who may wish
to comment upon the applications.
Without the Rule, the Commission
would be unable to fulfill these
statutory responsibilities.
This information collection
requirement was previously approved
by OMB, but the approval expired on
May 31, 2024. Accordingly, the
Commission will request a
reinstatement of OMB’s approval.
There are currently 25 national
securities exchanges subject to Rule
12f–1. The burden of complying with

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Rule 12f–1 arises when a potential
respondent seeks to reinstate its ability
to extend unlisted trading privileges to
any security for which unlisted trading
privileges have been suspended by the
Commission, pursuant to Section
12(f)(2)(A) of the Act. The staff estimates
that each application would require
approximately one hour to complete.
Thus, each potential respondent would
incur on average one burden hour in
complying with the Rule.
The Commission staff estimates that
there could be as many as 25 responses
annually for an aggregate annual hour
burden for all respondents of
approximately 25 hours (25 responses ×
1 hour per response). Each respondent’s
related internal cost of compliance for
Rule 12f–1 would be approximately
$242.00 (the cost of one hour of
professional work of a paralegal needed
to complete the application). The total
annual cost of compliance for all
potential respondents, therefore, is
approximately $6,050 (25 responses ×
$242.00 per response).
Compliance with Rule 12f–1 is
mandatory. Rule 12f–1 does not have a
record retention requirement per se.
However, responses made pursuant to
Rule 12f–1 are subject to the
recordkeeping requirements of Rules
17a–3 and 17a–4 of the Act. Information
received in response to Rule 12f–1 shall
not be kept confidential; the information
collected is public information.
Written comments are invited on: (a)
whether the proposed collection of
information is necessary for the proper
performance of the functions of the
Commission, including whether the
information shall have practical utility;
(b) the accuracy of the Commission’s
estimates of the burden of the proposed
collection of information; (c) ways to
enhance the quality, utility, and clarity
of the information collected; and (d)
ways to minimize the burden of the
collection of information on
respondents, including through the use
of automated collection techniques or
other forms of information technology.
Consideration will be given to
comments and suggestions submitted by
November 12, 2024.
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
under the PRA unless it displays a
currently valid OMB control number.
Please direct your written comments
to: Austin Gerig, Director/Chief Data
Officer, Securities and Exchange
Commission, c/o Oluwaseun Ajayi, 100
F Street NE, Washington, DC 20549 or
send an email to: PRA_Maailbox@
sec.gov.

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Federal Register / Vol. 89, No. 175 / Tuesday, September 10, 2024 / Notices

Dated: September 5, 2024.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2024–20366 Filed 9–9–24; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–100930; File No. SR–OCC–
2024–011]

Self-Regulatory Organizations; The
Options Clearing Corporation; Notice
of Filing of Proposed Rule Change, as
Modified by Partial Amendment No. 1,
by The Options Clearing Corporation
Concerning Its Stock Loan Programs
September 4, 2024.

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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 22, 2024, The
Options Clearing Corporation (‘‘OCC’’ or
‘‘Corporation’’) 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. On
September 3, 2024, OCC filed a partial
amendment (‘‘Partial Amendment No.
1’’) to the proposed rule change.3 The
Commission is publishing this notice to
solicit comments on the proposed rule
change, as modified by Partial
Amendment No. 1 (hereafter ‘‘the
proposed rule change’’), from interested
persons.
I. Clearing Agency’s Statement of the
Terms of Substance of the Proposed
Rule Change
This proposed rule change would
address limitations in the structure of
OCC’s Stock Loan/Hedge (‘‘Hedge’’)
Program and Market Loan Program
(together, the ‘‘Stock Loan Programs’’)
by creating the framework for a single,
enhanced program designed to support
current and future needs. The proposed
enhancements would, among other
things, (i) combine into the Market Loan
Program favorable aspects of both Stock
Loan Programs, including the
submission of bilaterally negotiated
transactions; (ii) conform the terms of
stock loans submitted under the Market
Loan Program (‘‘Market Loans’’) more
1 15

U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 In Partial Amendment No. 1, OCC corrected an
error in Exhibit 5A to SR–OCC–2024–011 without
changing the substance of the proposed rule change.
Partial Amendment No. 1 does not materially alter
the substance of the proposed rule change or raise
any novel regulatory issues.
2 17

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closely to the provisions most
commonly included in stock loan
transactions executed under standard
loan market documents; (iii) provide a
uniform guaranty of terms across Market
Loans, regardless of how those Market
Loans are initiated under the enhanced
program; (iv) support transactions under
both Stock Loan Programs through
OCC’s new clearance and settlement
system; and (v) reorganize, restate, and
consolidate provisions of OCC’s ByLaws and Rules governing the Stock
Loan Programs.
The proposed amendments to OCC’s
Rules and By-Laws can be found in
Exhibit 5A and Exhibit 5B to File No.
SR–OCC–2024–011, respectively.
Proposed conforming changes to OCC’s
internal Margin Policy and Recovery
and Wind-Down (‘‘RWD’’) Plan, which
can be found in confidential Exhibits 5C
and 5D to File No. SR–OCC–2024–011,
respectively. Material proposed to be
added is marked by underlining and
material proposed to be deleted is
marked with strikethrough text. For ease
of presentation and to distinguish
between changes to rule text versus
relocation of existing rule text, Exhibits
5A and 5B to File No. OCC–2024–011
contain bracketed text to indicate when
existing text has been relocated from the
By-Laws to the Rules with changes as
marked. That bracketed text describes
changes that would be performed upon
implementation of File No. SR–OCC–
2024–011, but it is not intended to be
rule text. All terms with initial
capitalization that are not otherwise
defined herein have the same meaning
as set forth in the By-Laws and Rules.4
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
In its capacity as a central
counterparty registered with the
Commission, OCC currently operates
two programs through which it clears
4 OCC’s By-Laws and Rules can be found on
OCC’s public website: https://www.theocc.com/
Company-Information/Documents-and-Archives/
By-Laws-and-Rules.

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stock loan transactions: the Hedge
Program and the Market Loan Program.
Under both Stock Loan Programs, OCC
becomes the lender to the borrower and
the borrower to the lender, thereby
guaranteeing the return of the full value
of cash collateral to the Borrowing
Clearing Member and the return of the
Loaned Stock (or value of that Loaned
Stock) to the Lending Clearing Member.
Under the Market Loan Program, OCC
also offers certain additional guarantees,
discussed in more detail below, with
respect to other payment obligations
arising from the stock loan transactions
(e.g., dividend equivalent payments and
rebate payments). As a result of OCC’s
novation of cleared stock loan
transactions, the rights and obligations
of the Borrowing and Lending Clearing
Members are thereafter governed by
OCC’s By-Laws and Rules.5 OCC’s ByLaws and Rules also provide for, among
other things, how Clearing Members
initiate Stock Loans at OCC, how those
Stock Loans are recorded in OCC’s
books and records, how returns and
recalls are processed, and risk
management procedures specific to
Stock Loans in the event that OCC
suspends one of the Clearing Member
counterparties.
As announced in 2022, OCC intends
to replace its current clearance and
settlement system (ENCORE) with a
streamlined operational framework for
clearance and settlement (Ovation).6
The move to Ovation gives OCC the
opportunity to address limitations in the
structure of OCC’s Stock Loan Programs
and enhance OCC’s stock loan services
to support current and future needs.7
OCC proposes a number of amendments
to its By-Laws and Rules designed to,
5 Terms provided under a Master Stock Lending
Agreement (‘‘MSLA’’) between the parties to a Stock
Loan may remain in effect as between the parties
to the extent they are not inconsistent with the ByLaws and Rules, but do not impose any obligation
on OCC. See OCC Rule 2202(b).
6 See OCC Announces New Platform Name and
Launches Enhanced Transformation website (May
10, 2022), https://www.theocc.com/newsroom/
views/2022/05-10-occ-announces-new-platformname-and-launches-enhanced-transformationwebsite.
7 As discussed in more detail below, OCC’s
current programs are limited by certain inefficient
legacy practices including, for example: (1)
position-based recordkeeping that does not align
with the contract-level accounting that is common
throughout the stock loan industry, which adds
complexity to the process of ensuring that all
parties are in alignment on the state of their stock
loans; (2) workflows that involve settlement of
delivery versus payment obligations at the
Depository prior to clearance or settlement at OCC,
which adds further complexity to the reconciliation
process and can lead to position breaks; and (3)
payment flows common to stock loans that are not
guaranteed under OCC’s Hedge Loan program and
must currently be settled as between the parties
away from OCC.

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