Daily Rules, Proposed Rules, and Notices of the Federal Government
CME proposes to amend certain of its rules to comply with pending revisions to Commodity Futures Trading Commission ("CFTC") Regulations governing derivatives clearing organizations ("DCOs"). The text of the proposed rule changes is available at the CME's Web site at
In its filing with the Commission, CME 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 III below. CME has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
CME is registered as a derivatives clearing organization with the CFTC and operates a substantial business clearing futures and swaps contracts subject to the jurisdiction of the CFTC. CME proposes to amend certain of its rules to comply with pending changes to CFTC Regulations that require DCOs to make corresponding rule changes. The changes that are the subject of this filing are required by the CFTC to become effective on October 1, 2012.
CFTC Regulation 39.12(b)(7) (Time Frame for Clearing), which becomes effective on October 1, requires each DCO to have rules providing that the DCO: (1) "will accept or reject for clearing as quickly after execution as would be technologically practicable if fully automated systems were used, all contracts" listed for clearing and executed competitively on or subject to the rules of a designated contract market ("DCM") or a swap execution facility ("SEF"); and (2) "will accept or reject for clearing as quickly after submission to the [DCO] as would be technologically practicable if fully automated systems were used, all swaps" listed for clearing that are not executed on or subject to the rules of a DCM or a SEF or executed noncompetitively on or subject to the
CME also made a separate filing, CME Submission 12-280, with its primary regulator, the CFTC, with respect to the proposed rule changes.
CME believes the proposed changes are consistent with the requirements of the Exchange Act. CME, a derivatives clearing organization, is required to implement the proposed changes to comply with recent changes to CFTC regulations. CME notes that the policies of the Commodity Exchange Act ("CEA") with respect to clearing are comparable to a number of the policies underlying the Exchange Act, such as promoting market transparency for derivatives markets, promoting the prompt and accurate clearance of transactions and protecting investors and the public interest. CME believes the mandatory CFTC changes are specifically designed to facilitate the prompt and efficient processing of all contracts, agreements, and transactions submitted for clearing and will therefore help protect investors and safeguard customer funds.
CME does not believe that the proposed rule change will have any impact, or impose any burden, on competition.
CME has not solicited, and does not intend to solicit, comments regarding this proposed rule change. CME has not received any unsolicited written comments from interested parties.
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:
* Use the Commission's Internet comment form (
* Send an email to
* Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-CME-2012-38 and should be submitted on or before October 26, 2012.
Section 19(b) of the Act
In its filing, CME requested that the Commission approve this proposed rule change on an accelerated basis for good cause shown. CME cites as the reason for this request CME's operation as a DCO, which is subject to regulation by the CFTC under the CEA, and that the proposed rule changes are required to comply with new CFTC regulations that become effective on October 1, 2012.
The Commission finds good cause, pursuant to Section 19(b)(2) of the Act,