8011-01P
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-94281; File No. SR-ICEEU-2022-005]
Self-Regulatory Organizations; ICE Clear Europe Limited; Notice of Filing and
Immediate Effectiveness of Proposed Rule Change Relating to Amendments to the Rate
of Return on Euro and Pound Sterling Cash Margin and Guaranty Fund Deposits
February 18, 2022.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),1 and
Rule 19b-4 thereunder,2 notice is hereby given that on February 15, 2022, ICE Clear
Europe Limited (“ICE Clear Europe” or the “Clearing House”) filed with the Securities
and Exchange Commission (“Commission”) the proposed rule changes described in
Items I, II and III below, which Items have been prepared primarily by ICE Clear Europe.
ICE Clear Europe filed the proposed rule change pursuant to Section 19(b)(3)(A) of the
Act3 and Rule 19b-4(f)(2) thereunder,4 such that the proposed rule change was
immediately effective upon filing with the Commission. The Commission is publishing
this notice to solicit comments on the proposed rule change from interested persons.
I.

Clearing Agency’s Statement of the Terms of Substance of the Proposed Rule
Change
The principal purpose of the proposed amendments is for ICE Clear Europe to

amend the rate of return paid by the Clearing House on Euro (“EUR”) and Pound Sterling
(“GBP”) cash margin and Guaranty Fund deposits. The proposed amendments do not
involve any changes to the ICE Clear Europe Clearing Rules or Procedures.5

15 U.S.C. 78s(b)(1).

17 CFR 240.19b-4.

15 U.S.C. 78s(b)(3)(A).

17 CFR 240.19b-4(f)(2).

Capitalized terms used but not defined herein have the meanings specified in the
ICE Clear Europe Clearing Rules.

II.

Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the
Proposed Rule Change
In its filing with the Commission, ICE Clear Europe 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. ICE Clear Europe has prepared
summaries, set forth in sections (A), (B), and (C) below, of the most significant aspects
of such statements.
(A) Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed
Rule Change
(a)
(a)

Purpose
The purpose of the proposed rule changes is for ICE Clear Europe to [sic]

its rate of return paid on EUR and GBP cash margin and Guaranty Fund deposits
applicable to all Clearing Members for house and customer accounts. ICE Clear Europe
pays a rate of return on cash deposited by Clearing Members in respect of margin and
Guaranty Fund requirements referred to as the ICE Deposit Rate (the “IDR”). The IDR is
calculated daily and applied to cash balances held at the close of business on the previous
business day in respect of US Dollar (“USD”), EUR and GBP deposits. The IDR is
calculated as the net income earned on cash deposits in the relevant currency (positive or
negative) less a charge or spread. Currently, the spread for all currencies is 15 bps.
(b)

ICE Clear Europe is proposing to increase the spread for EUR balances

from 15 bps to 25 bps and reduce the spread for GBP balances from 15 bps to 12 bps.
The spread for USD balances would remain unchanged at 15 bps. ICE Clear Europe has
determined that in light of financial market conditions, including repo rates available in
the market, the current spread levels have provided an incentive for Clearing Members to
provide EUR balances as compared to GBP balances, including by using EUR balances
to cover margin obligations denominated in GBP. Such a practice by Clearing Members

could result in reduced available liquidity for the Clearing House in GBP. To avoid such
potential concerns, ICE Clear Europe believes it is appropriate to reduce the IDR on EUR
balances (through a higher spread) while comparatively increasing the IDR on GBP
balances (through a lower spread). ICE Clear Europe believes the change would better
align the relative costs and benefits of using EUR and GBP to cover margin and Guaranty
Fund obligations and thereby improve Clearing House liquidity management.
(b)

Statutory Basis

ICE Clear Europe believes that the proposed rule changes are consistent with the
requirements of the Act, including Section 17A of the Act6 and regulations thereunder
applicable to it. In particular, Section 17A(b)(3)(D) of the Act7 requires that “[t]he rules
of the clearing agency provide for the equitable allocation of reasonable dues, fees and
other charges among its participants”. ICE Clear Europe believes that the IDR, as
proposed to be amended, would be reasonable and appropriate in light of market
conditions, including available repo rates, for the relevant currencies. The proposed
modifications would apply to all Clearing Members and other market participants who
hold cash balances in EUR and GBP. Further, ICE Clear Europe has determined that the
revised spreads would enhance GBP liquidity by providing a greater incentive for
Clearing Members to provide GBP balance to satisfy GBP margin and Guaranty Fund
obligations as compared to EUR balances. As such, in ICE Clear Europe’s view, the
amendments are consistent with the equitable allocation of reasonable dues, fees and
other charges among its Clearing Members and other market participants, within the
meaning of Section 17A(b)(3)(D) of the Act.8

15 U.S.C. 78q-1.

15 U.S.C. 78q-1(b)(3)(D).

15 U.S.C. 78q-1(b)(3)(D).

The proposed amendments are also consistent with the requirements of Section
17A(b)(3)(F) of the Act9 which requires, among other things, that “[t]he rules of a
clearing agency […] are not designed to permit unfair discrimination in the admission
of participants or among participants in the use of the clearing agency”. As noted above,
the GBP and EUR spreads, as proposed to be amended, would apply on a currency level
and would apply to all Clearing Members. The amendments would not otherwise change
the ability of Clearing Members to post GBP and EUR in satisfaction of their obligations.
As a result, the amendments would not result in any unfair discrimination among
Clearing Members in their use of the Clearing House, within the meaning of Section
17A(b)(3)(F) of the Act.10
(B) Clearing Agency’s Statement on Burden on Competition
ICE Clear Europe does not believe the proposed rule changes would have any
impact, or impose any burden, on competition not necessary or appropriate in furtherance
of the purpose of the Act. Although ICE Clear Europe is revising certain spreads applied
to the IDR, as set forth herein, it believes such changes are appropriate to align incentives
for providing EUR and GBP deposits with general market conditions and to avoid
potential reductions in GBP liquidity. Further, as discussed above, the changes to the
spreads would be applied equally to all Clearing Members who deposit cash balances in
EUR and GBP. ICE Clear Europe does not believe that the amendments would adversely
affect the ability of such Clearing Members or other market participants generally to
access clearing services. Further, ICE Clear Europe believes that the amendments would
not otherwise affect competition among Clearing Members, adversely affect the market
for clearing services or limit market participants’ choices for obtaining clearing services.

15 U.S.C. 78q-1(b)(3)(F).

15 U.S.C. 78q-1(b)(3)(F).

As a result, ICE Clear Europe does not believe the amendments would have any impact
or impose any burden on competition that is not necessary or appropriate in furtherance
of the purposes of the Act.
(C) Clearing Agency’s Statement on Comments on the Proposed Rule Change Received
from Members, Participants or Others
Written comments relating to the proposed amendments have not been solicited or
received by ICE Clear Europe. ICE Clear Europe will notify the Commission of any
comments received with respect to the proposed rule change.
III.

Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)

of the Act11 and paragraph (f)(2) of Rule 19b-412 thereunder. At any time within 60 days
of the filing of the proposed rule change, the Commission summarily may temporarily
suspend such rule change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or otherwise in
furtherance of the purposes of the Act.
IV.

Solicitation of Comments
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:
Electronic Comments:
ï‚·

Use the Commission’s Internet comment form
(http://www.sec.gov/rules/sro.shtml) or

15 U.S.C. 78s(b)(3)(A).

17 CFR 240.19b-4(f)(2).

ï‚·

Send an e-mail to rule-comments@sec.gov. Please include File Number SRICEEU-2022-005 on the subject line.

Paper Comments:
ï‚·

Send paper comments in triplicate to Secretary, Securities and Exchange
Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to File Number SR-ICEEU-2022-005. This file

number should be included on the subject line if e-mail is used. To help the Commission
process and review your comments more efficiently, please use only one method. The
Commission will post all comments on the Commission’s Internet website
(http://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 10:00 am and
3:00 pm. Copies of such filings will also be available for inspection and copying at the
principal office of ICE Clear Europe and on ICE Clear Europe’s website at
https://www.theice.com/clear-europe/regulation.
All comments received will be posted without change. Persons submitting
comments are cautioned that we do not redact or edit personal identifying information
from comment submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File Number SR-ICEEU-2022-005
and should be submitted on or before [insert date 21 days from publication in the Federal
Register].

For the Commission, by the Division of Trading and Markets, pursuant to
delegated authority.13
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-03961 Filed: 2/24/2022 8:45 am; Publication Date: 2/25/2022]

17 CFR 200.30-3(a)(12).