Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
CME is filing a proposed rule change that is limited to its business as a derivatives clearing organization. More specifically, the proposed rule change would make amendments to its rules to correct an error in the current rule text of CME Rule 274H.02.A. regarding cash settlement of Cleared OTC USD/CLP Spot, Forwards and Swaps Contracts.
In its filing with the Commission, CME included statements concerning the purpose 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. 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 Commodity Futures Trading Commission and currently offers clearing services for many different futures and swaps products. With this filing, CME proposes to make amendments to its rules regarding its OTC foreign currency (“FX”) swap clearing offering. Although this change will be effective on filing, CME plans to operationalize the proposed change on November 17, 2013 for trade date November 18, 2013.
The proposed rule change is intended to correct an error in the current rule text of CME Rule 274H.02.A. regarding Cash Settlement of Cleared OTC USD/CLP Spot, Forwards and Swaps Contracts. Specifically, the proposed rule change would amend the time of the underlying benchmark fixing for the spot exchange rate of the Chilean peso per U.S. dollar that is calculated by the Central Bank of Chile and is used by CME for the final cash settlement of Cleared OTC USD/CLP from 8:00 p.m. Santiago time to 10:30 a.m. Santiago time.
The change that is described in this filing is limited to CME's business as a derivatives clearing organization clearing products under the exclusive jurisdiction of the Commodity Futures Trading Commission (“CFTC”) and does not materially impact CME's security-based swap clearing business in any way. CME notes that it has already submitted the proposed rule change that is the subject of this filing to its primary regulator, the CFTC, in CME Submission 13–507R.
CME believes the proposed rule change is consistent with the requirements of the Act including Section 17A of the Act.
Furthermore, the proposed change is limited in its effect to swaps products offered under CME's authority to act as a derivatives clearing organization. These products are under the exclusive jurisdiction of the CFTC. As such, the proposed change is limited to CME's activities as a derivatives clearing organization clearing swaps that are not security-based swaps; CME notes that the policies of the CFTC with respect to administering the Commodity Exchange Act are comparable to a number of the policies underlying the Act, such as promoting market transparency for over-the-counter derivatives markets, promoting the prompt and accurate clearance of transactions and protecting investors and the public interest.
Because the proposed change is limited in its effect to swaps products offered under CME's authority to act as a derivatives clearing organization, the proposed change is properly classified as effecting a change in an existing service of CME that:
(a) Primarily affects the clearing operations of CME with respect to products that are not securities, including futures that are not security futures, and swaps that are not security-based swaps or mixed swaps; and
(b) does not significantly affect any securities clearing operations of CME or any rights or obligations of CME with respect to securities clearing or persons using such securities-clearing service.
CME does not believe that the proposed rule change will have any impact, or impose any burden, on competition. The rule change makes changes to accurately reflect the timing of the pricing mechanism for settlement of swaps contracts and should therefore not be seen to have any competitive concerns.
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.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)
Interested persons are invited to submit written data, views and
• 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–2013–30 and should be submitted on or before December 16, 2013.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.