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2017-08161

  • Federal Register, Volume 82 Issue 77 (Monday, April 24, 2017)

    [Federal Register Volume 82, Number 77 (Monday, April 24, 2017)]

    [Notices]

    [Pages 18900-18901]

    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]

    [FR Doc No: 2017-08161]

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    COMMODITY FUTURES TRADING COMMISSION

    Agency Information Collection Activities: Notice of Intent To

    Renew Collection Number 3038-0091, Disclosure and Retention of Certain

    Information Relating to Cleared Swaps Customer Collateral

    AGENCY: Commodity Futures Trading Commission.

    ACTION: Notice.

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    SUMMARY: The Commodity Futures Trading Commission (``CFTC'' or

    ``Commission'') is announcing an opportunity for public comment on the

    proposed renewal of a collection of certain information by the agency.

    Under the Paperwork Reduction Act (``PRA''), Federal agencies are

    required to publish notice in the Federal Register concerning each

    proposed collection of information, including each proposed extension

    of an existing collection of information, and to allow 60 days for

    public comment. This notice solicits comments on the collections of

    information provided for by the Commission's regulations under the

    Commodity Exchange Act (``CEA'') relating to the protection of customer

    collateral held by futures commission merchants (``FCM'') and

    derivatives clearing organizations (``DCO'') to serve as margin in

    cleared swaps transactions.

    DATES: Comments must be submitted on or before June 23, 2017.

    ADDRESSES: You may submit comments, identified by ``Disclosure and

    Retention of Certain Information Relating to Cleared Swaps Customer

    Collateral,'' and Collection Number 3038-0091 by any of the following

    methods:

    The Agency's Web site, at http://comments.cftc.gov/.

    Follow the instructions for submitting comments through the Web site.

    Mail: Christopher Kirkpatrick, Secretary of the

    Commission, Commodity Futures Trading Commission, Three Lafayette

    Centre, 1155 21st Street NW., Washington, DC 20581.

    Hand Delivery/Courier: Same as Mail above.

    Federal eRulemaking Portal: http://www.regulations.gov/.

    Follow the instructions for submitting comments through the Portal.

    Please submit your comments using only one method.

    All comments must be submitted in English, or if not, accompanied

    by an English translation. Comments will be posted as received to

    http://www.cftc.gov.

    FOR FURTHER INFORMATION CONTACT: Jacob Chachkin, Special Counsel, 202-

    418-5496, email: jchachkin@cftc.gov; or Joshua Beale, Special Counsel,

    202-418-5446, email: jbeale@cftc.gov, Division of Swap Dealer and

    Intermediary Oversight, Commodity Futures Trading Commission.

    SUPPLEMENTARY INFORMATION: Under the PRA,\1\ Federal agencies must

    obtain approval from the Office of Management and Budget (``OMB'') for

    each collection of information they conduct or sponsor. ``Collection of

    Information'' is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3 and

    includes agency requests or requirements that members of the public

    submit reports, keep records, or provide information to a third party.

    Section 3506(c)(2)(A) of the PRA, 44 U.S.C. 3506(c)(2)(A), requires

    Federal agencies to provide a 60-day notice in the Federal Register

    concerning each proposed collection of information, including each

    proposed extension of an existing collection of information, before

    submitting the collection to OMB for approval. To comply with this

    requirement, the CFTC is publishing notice of the proposed collection

    of information listed below.

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    \1\ 44 U.S.C. 3501 et seq.

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    Title: Disclosure and Retention of Certain Information Relating to

    Cleared Swaps Customer Collateral (OMB Control No. 3038-0091). This is

    a request for an extension of a currently approved information

    collection.

    [[Page 18901]]

    Abstract: Part 22 of the Commission's regulations under the CEA

    establish rules for the protection of customer collateral held by FCMs

    and DCOs to serve as margin in cleared swaps transactions. As part of

    this regulatory scheme, regulations 22.2(g), 22.5(a), 22.11, 22.12,

    22.16, and 22.17 impose recordkeeping and third-party disclosure

    requirements on FCMs and DCOs. In addition, regulation 22.13(c)(2)

    indirectly requires FCMs who post excess collateral with DCOs to

    perform certain computations regarding such collateral, although it is

    not expected to materially affect the total paperwork burden associated

    with part 22.

    Regulation 22.2(g) requires each FCM with Cleared Swaps Customer

    Accounts \2\ to, among other things, compute daily and report to the

    Commission the amount of Cleared Swaps Customer Collateral \3\ on

    deposit in such accounts, the amount of such collateral required to be

    on deposit in such accounts and the amount of the FCM's residual

    financial interest in such accounts. Regulation 22.5(a) requires an FCM

    or DCO to obtain, from each depository with which it deposits cleared

    swaps customer funds, a letter acknowledging that such funds belong to

    the Cleared Swaps Customers \4\ of the FCM or DCO, and not the FCM,

    DCO, or any other person. Regulation 22.11 requires each FCM that

    intermediates cleared swaps for customers on or subject to the rules of

    a DCO, whether directly as a clearing member or indirectly through a

    Collecting FCM,\5\ to provide the DCO or the Collecting FCM, as

    appropriate, with information sufficient to identify each customer of

    the FCM whose swaps are cleared by the FCM. Regulation 22.11 also

    requires the FCM, at least once daily, to provide the DCO or the

    Collecting FCM, as appropriate, with information sufficient to identify

    each customer's portfolio of rights and obligations arising out of

    cleared swaps intermediated by the FCM. Regulation 22.12 requires that

    each Collecting FCM and DCO, on a daily basis, calculate, based on

    information received pursuant to regulation 22.11 and on information

    generated and used in the ordinary course of business by the Collecting

    FCM or DCO, and record certain information about the amount of

    collateral required for each Cleared Swaps Customer and the sum of

    these amounts. Regulation 22.16 requires that each FCM who has Cleared

    Swaps Customers disclose to each of such customers the governing

    provisions, as established by DCO rules or customer agreements between

    collecting and depositing FCMs, relating to use of customer collateral,

    transfer, neutralization of the risks, or liquidation of cleared swaps

    in the event of default by a Depositing FCM \6\ relating to a Cleared

    Swaps Customer Account. Regulation 22.17 requires that FCM produce a

    written notice of the reasons and the details concerning withdrawals

    from Cleared Swaps Customers Account not for the benefit of Cleared

    Swap Customers if such withdrawal will exceed 25% of the FCMs residual

    interest in such account.

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    \2\ For the definition of Cleared Swaps Customer Account, see

    Commission regulation 22.1. 17 CFR 22.1.

    \3\ Id.

    \4\ Id.

    \5\ Id.

    \6\ Id.

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    The Commission believes that the information collection obligations

    imposed by Commission regulations 22.2(g), 22.5(a), 22.11, 22.12,

    22.16, and 22.17 are essential (i) to ensuring that FCMs and DCOs

    develop and maintain adequate customer protections and procedures over

    Cleared Swap Customer funds as required by the CEA, and Commission

    regulations, and (ii) to the effective evaluation of these registrants'

    actual compliance with the CEA and Commission regulations. An agency

    may not conduct or sponsor, and a person is not required to respond to,

    a collection of information unless it displays a currently valid OMB

    control number.

    With respect to the collection of information, the CFTC invites

    comments on:

    Whether the proposed collection of information is

    necessary for the proper performance of the functions of the

    Commission, including whether the information will have a practical

    use;

    The accuracy of the Commission's estimate of the burden of

    the proposed collection of information, including the validity of the

    methodology and assumptions used;

    Ways to enhance the quality, usefulness, and clarity of

    the information to be collected; and

    Ways to minimize the burden of collection of information

    on those who are to respond, including through the use of appropriate

    automated electronic, mechanical, or other technological collection

    techniques or other forms of information technology; e.g., permitting

    electronic submission of responses.

    You should submit only information that you wish to make available

    publicly. If you wish the Commission to consider information that you

    believe is exempt from disclosure under the Freedom of Information Act,

    a petition for confidential treatment of the exempt information may be

    submitted according to the procedures established in Sec. 145.9 of the

    Commission's regulations.\7\

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    \7\ 17 CFR 145.9.

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    The Commission reserves the right, but shall have no obligation, to

    review, pre-screen, filter, redact, refuse or remove any or all of your

    submission from http://www.cftc.gov that it may deem to be

    inappropriate for publication, such as obscene language. All

    submissions that have been redacted or removed that contain comments on

    the merits of the information collection request will be retained in

    the public comment file and will be considered as required under the

    Administrative Procedure Act and other applicable laws, and may be

    accessible under the Freedom of Information Act.

    Burden Statement: The Commission is revising its estimate of the

    burden for this collection to reflect the current number of affected

    registrants. Accordingly, the respondent burden for this collection is

    estimated to be as follows:

    Number of Registrants: 68.

    Estimated Average Burden Hours per Registrant: 365.

    Estimated Aggregate Burden Hours: 24,820.

    Frequency of Recordkeeping: As applicable.

    (Authority: 44 U.S.C. 3501 et seq.)

    Dated: April 18, 2017.

    Robert N. Sidman,

    Deputy Secretary of the Commission.

    [FR Doc. 2017-08161 Filed 4-21-17; 8:45 am]

    BILLING CODE 6351-01-P

    Last Updated: April 24, 2017