[Federal Register Volume 85, Number 154 (Monday, August 10, 2020)]
[Notices]
[Pages 48295-48303]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-17346]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-89465; File No. SR-LCH SA-2020-003]
Self-Regulatory Organizations; LCH SA; Notice of Filing of
Proposed Rule Change, as Modified by Amendment No. 1, Relating to LCH
SA's Governance Arrangements
August 4, 2020.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4,\2\ notice is hereby given that on July
23, 2020, Banque Centrale de Compensation, which conducts business
under the name LCH SA (``LCH SA''), filed with the Securities and
Exchange Commission (``Commission'') the proposed rule change
(``Proposed Rule Change''), as described in Items I, II and III below,
which Items have been prepared by the clearing agency. On July 29,
2020, LCH SA filed 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 Amendment No. 1 (the ``proposed
rule change''), from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ LCH SA filed Amendment No. 1 to correct the Exhibit 5 to the
original filing to reflect a change in Article 13 of the Terms of
Reference of the Board of Directors of LCH SA, which is described
below, and to correct an erroneous citation in Item II.A.2 below.
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I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change
LCH SA, a registered clearing agency and self-regulatory
organization, is a majority-owned subsidiary of LCH Group Holdings
Limited (``LCH Group'').\4\ LCH Group is indirectly majority-owned by
London Stock Exchange Group PLC (``LSEG''). LCH SA is proposing to
amend its governance documents (``Governance Documents'') including:
(i) The Terms of Reference (``ToR'') of the Board of Directors
(``Board''); and (ii) the TOR of the current committees of the Board.
The Proposed Rule Change will also establish ToR of a Nominating
Committee for LCH SA.
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\4\ LCH Group owns 88.9 percent of LCH SA; Euronext N.V. owns
11.1 percent of LCH SA. LCH Group is also the parent of LCH Limited,
a central counterparty (``CCP'') authorized to offer services and
activities in the European Union in accordance with the European
Markets Infrastructure Regulation (``EMIR'') and registered with the
Commodity Futures Trading Commission (``CFTC'') as a derivatives
clearing organization (``DCO'').
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[[Page 48296]]
II. Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change
In its filing with the Commission, LCH SA 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. LCH SA has prepared summaries, set forth in sections A,
B, and C below, of the most significant aspects of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Proposed Rule Change is being adopted in significant part to
conform LCH SA's Governance Documents to actions taken by LCH Group to
simplify its governing arrangements and to eliminate provisions in LCH
Group's governance documents that they have determined are unnecessary
and outdated. These changes will allow the LCH group as a whole to
operate more efficiently and effectively. Although LCH SA's Governance
Documents will be revised to reflect the changes to the LCH Group's
governing arrangements described below, in practice, these revisions
will not result in any substantive changes in LCH SA's current
governance.
a. Background
In connection with its purchase of approximately 58 percent of LCH
Group \5\ in 2013, LSEG entered into a Relationship Agreement with LCH
Group for the purpose of (i) assuring certain protections for minority
LCH Group shareholders, (ii) providing for representation of
stakeholders in the CCPs that comprise LCH Group, i.e., the clearing
members of each CCP and the exchanges whose transactions were cleared
through LCH SA or LCH Limited, and (iii) recognizing LSEG's
requirements as majority shareholder for appropriate controls over LCH
Group.\6\ To this end, among other provisions, the Relationship
Agreement: (i) Set out certain Core Operating Principles to be applied
in managing the business of LCH Group; (ii) provided that the Board of
Directors of LCH Group and each CCP would be comprised of a prescribed
mix of independent non-executive directors, executive directors, User
Directors,\7\ exchanges (``Venues'') and LSEG representatives; (iii)
provided that LCH Group would have a separate Audit Committee and
Remuneration Committee independent of the parallel committees at each
CCP; and (iv) provided for a Nomination Committee, which would be
responsible for nominating independent non-executive directors, User
Directors and Venue Directors of the Board of Directors and committee
members at LCH Group and each CCP.
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\5\ LCH Group was then known as LCH.Clearnet Group Limited.
\6\ As appropriate, provisions of the Relationship Agreement
were reflected in the LCH Group Articles of Association and the ToR
of the LCH Group Board of Directors.
\7\ User Directors are individuals that are associated with or
connected to clearing members that are also shareholders of LCH
Group.
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The Relationship Agreement also provided for certain minority
protection reserved matters, which would require the approval of 80
percent of votes cast on a resolution, including: (i) Altering the
constitutional documents of LCH Group; (ii) making material changes to
the Core Operating Principles; (iii) proposals to wind-up LCH Group or
any material LCG Group company; and (iv) material amendments to the
Relationship Agreement.
In addition, the Relationship Agreement contained customary consent
rights for LSEG as a majority shareholder, including: (i) Approval of
business and budget plans; (ii) matters representing changes from the
Core Operating Principles; (iii) material changes to regulatory
obligations and risk profile; (iv) material acquisitions/disposals; and
(v) settlement of material litigation (collectively, ``Consent
Matters''). The Relationship Agreement also reserved for LSEG the right
to put certain matters to shareholder vote where LCH Group either
failed to consider the matter or considered it and voted it down
(``Push Matters'').\8\
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\8\ LSEG never exercised this right.
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As noted above, LCH Group has determined to simplify its governing
arrangements and to eliminate provisions in LCH Group's governance
documents that are unnecessary and outdated. In this regard, LCH Group
and LSEG have decided to terminate the Relationship Agreement and to
remove duplication in board decision-making between LCH Group and the
CCP Boards by making the LCH Group Board an internal only board, i.e.,
comprised only of representatives of LSEG and LCH Group. The LCH Group
Articles of Association similarly will be revised to eliminate those
provisions arising from the Relationship Agreement.
The Relationship Agreement is no longer necessary because certain
contractual provisions are provided for in law of regulation and other
provisions are historic and no longer relevant. Importantly, since
2013, LSEG has added to its shareholdings in LCH Group and now owns
approximately 83 percent of LCH Group. Therefore, the minority
protection provisions noted above are no longer relevant as LSEG alone
could approve such matters by voting its shares. As explained below,
however, certain protections in the Relationship Agreement will be
incorporated into the revised ToR of the Board of Directors.\9\
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\9\ Such protections include but are not limited to certain
consent rights and the right to have a representative on the Board
of Directors of LCH SA and LCH Limited, as well as the several
committees of LCH SA and LCH Limited
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b. Proposed Amendments to the ToR
As noted earlier, the Proposed Rule Change is being adopted in
significant part to conform LCH SA's Governance Documents to actions
taken by LCH Group to simplify its governing arrangements. These
changes will allow the LCH group as a whole to operate more efficiently
and effectively. Importantly, there will be no change in the proportion
of independent directors \10\ or the number of directors representing
members and participants. Therefore, the Board and the committees of
the Board will continue to assure fair representation of its members
and participants in the selection of its directors and the
administration of its affairs as provided in section 17A(b)(3)(C) of
the Act.\11\
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\10\ The ToR of the LCH SA Board defines an independent director
as a director who satisfies applicable Regulatory Requirements,
i.e., any regulation or requirement of applicable law or of any
applicable regulatory body, regarding independent directors, and who
is appointed in accordance with the Nomination Committee ToR.
\11\ 15 U.S.C. 78q-1(b)(3)(C).
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Terms of Reference of the Board of Directors
The ToR of the Board will be amended as necessary to remove those
provisions that are no longer required as a result of the termination
of the Relationship Agreement and the amendment of the LCH Group
Articles of Association:
Article 2, Definitions, will be amended to remove those
definitions arising from the Relationship Agreement, including: (i)
Core Operating Principles; (ii) Customer; (iii) Customer Director; (iv)
Group Nomination Committee (which is being disbanded); (v) LSEG Audit
Representative; (vi) LSEG Consent Matters; (vii) LSEG NomCom
Representative; (viii) Material Interest; (ix) Minority Protection
Reserved
[[Page 48297]]
Matters; (x) Push Matters: (xi) Relationship Agreement; (xii)
Significant Interest; (xiii) Venue; (xiv) Venue Director.
Article 3, Composition of the Board, will be amended (i)
to remove the requirement that the Chairman of LCH Group will be a non-
executive director of the Board, (ii) to confirm that LSEG is entitled
to a representative on the Board unconditionally,\12\ (iii) to remove
the requirement for a Venue Director,\13\ and (iv) to confirm that
Euronext is entitled to propose the appointment of a representative to
the Board as long as either the Cash Clearing Agreement or the
Derivatives Clearing Agreement between Euronext and LCH SA remains in
force.\14\ Article 3 will be further amended to provide that the Chief
Risk Officer of LCH Group may, but is not required to, be one of the
three executive Directors of the Board. Article 3 currently provides
that the Chief Risk Officer of LCH Group, along with the CEO of LCH SA
and the CEO of LCH Group will be the executive Directors of the Board.
Finally, Article 3 references the new Nomination Committee, rather than
the Group Nomination Committee.
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\12\ Article 3 currently provides that LSEG is entitled to a
representative on the Board ``for so long as LSEG is entitled to
exercise or control the exercise of at least 5 percent of the votes
able to be cast on all or substantially all matters at general
meetings in LCH Group Holdings Limited''.
\13\ With the exception of Euronext, there have been no Venue
representatives on the LCH SA Board for some time. This is because a
Venue must also be a shareholder of LCH Group in order to qualify
for representation on the Board. Nasdaq was the last significant
Venue on the LCH Group shareholder register but sold its stake in
2018. Since then, there has only been one entity that is a
combination of a User/Venue and that entity has shown no interest in
being represented on any LCH board. Euronext was a shareholder of
LCH Group, but moved its ownership stake to LCH SA in 2017. However,
it is entitled to a Board representation through its contractual
arrangements, i.e., the Cash Clearing Agreement and Derivatives
Clearing Agreement.
\14\ In accordance with the terms of the agreement pursuant to
which Euronext N.V. purchased 11.1 percent of the shares of LCH SA,
Euronext is already entitled to propose a representative to the
Board.
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Article 4, Rules applicable to Directors, will be amended
to remove references to the Relationship Agreement (and Consent
Matters, Minority Protection Reserved Matters and Push Matters therein)
and refer only to rights of consent that LSEG may have under this ToR.
Article 6, Quorum, will be amended to make a technical
correction to the first sentence of the article. The sentence currently
provides that the Board ``may validly deliberate only if half of the
Directors are present.'' This sentence could be interpreted to mean
that the Board could not deliberate if more than half of the Directors
are present, which clearly is not intended. As proposed to be revised,
this sentence will confirm that the Board ``may validly deliberate only
if at least half of the Directors are present.''
Article 12, Powers of the Board, will be amended to remove
references to the Relationship Agreement, including the Core Operating
Principles. However, the amendments to Article 12 will also confirm
that the Board's authority with respect to certain matters remains
subject to LSEG's consent. These matters, previously included in the
Relationship Agreement, include: (i) Approval of LCH SA's annual
operating and capital expenditure budget; (ii) approval of any material
changes to LCH SA's budget; (iii) approval of the terms and conditions
of any merger agreement between the LCH SA and a third party; and (iv)
approval of a decision of LCH SA to issue new shares. LSEG's consent
will also be required with regard to any matter that constitutes a
material increase in the risk profile of LCH SA's investment policy or
capital management policy that would result in a material decrease in
LCH SA's available liquidity resources (subject to certain exceptions).
In addition, LSEG's consent will be required with respect to (a) any
recommended changes to the structure, size and composition of the Board
that the Board, upon recommendations from the Nomination Committee, may
recommend for approval by a general meeting of the shareholders, and
(b) the ToR of any Board committees and any changes thereto, to the
extent provided for in the ToR of the Board or the ToR of the affected
committee.
Article 12 will also be amended to reflect the existing group
dividend policy including the factors to be taken into account when
determining the dividend (as currently set out in the Relationship
Agreement and the Euronext shareholders' agreement). Dividends are
subject to the vote of the shareholders, having regard for: (i)
Applicable regulatory and regulatory capital requirements; (ii)
restrictions in any finance documents; (iii) investment to support
capital expenditure contemplated by the business plan and budget from
time to time, including technology, taking into account future expected
cash flows; and (iv) applicable laws.
Moreover, Article 12 will be amended to clarify that the Board will
approve at least annually the LCH Group Risk Governance Framework and
LCH SA's various policies, including LCH SA's: (i) Financial Resource
Adequacy Policy; (ii) Default Management Policy; (iii) Collateral Risk
Policy; (iv) Investment Risk Policy; (v) Liquidity Risk Policy; (vi)
Settlement, Payment & Custody Risk Policy; (vii) Counterparty Credit
Risk Policy; (viii) Contract and Market Acceptability Policy; (ix)
Model Governance, Validation & Review Policy; (x) Operational Risk
Policy; (xi) and Procyclicality Policy and any significant changes to
those policies upon recommendations from the Risk Committee. Finally,
Article 12 will be amended to confirm that, in appointing the Chairman
of the Board and the LCH SA CEO, the Board will act in accordance with
the ToR of the Nomination Committee.
Article 13, Company management (Chairman--CEO), will be
amended to provide that certain actions, which previously the CEO was
authorized to take with the consent of the Board, may be undertaken
only after consultation with the board of LCH Group. These activities
include: (i) Any type of joint venture arrangement between LCH SA and
any third party; (ii) any acquisition of a business with a valuation
representing five percent or more of LCH SA's net revenue stated in the
last audited accounts published by LCH SA; (iii) any disposal of all or
any material part of LCH SA's business; (iv) any decision to cease to
operate all or any material part of LCH SA's business; (v) any
acquisition or disposal of shares or any interest in shares of LCH SA,
any significant investment in any third party or the making of any
takeover offer; and (vi) any material acquisitions and disposals,
including in relation to intellectual property and LCH SA's various
business segments and group undertakings.\15\ In addition, Article 13
will be amended to authorize the CEO or the CEO's management team to
provide to LSEG (subject to all laws and regulations (including
antitrust laws and regulations)), (a) sufficient financial and other
information that LSEG may reasonably require to meet any applicable
reporting requirements or standards and LSEG's budgeting and
forecasting processes; and (b) the audited accounts for each financial
year and monthly management reports, consistent with LSEG's existing
rights under the Relationship Agreement.
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\15\ For the purposes of this paragraph, an acquisition or
disposal will be material if the value of the consideration or the
assets that are the subject of the transaction exceed an aggregate
amount of [euro]10,000,000.
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Article 13 will also be amended to provide that, in line with
LSEG's consent rights in the Relationship Agreement, LSEG will have the
right to consent with regard to the settlement of any litigation that
could result in a
[[Page 48298]]
payment to or by LCH SA in excess of [euro]2,000,000 and with regard to
any IT investments proposed to be made by LCH SA if they exceed an
aggregate annual amount of [euro] 3,000,000.
Article 14, Conflicts of Interest, will be amended to
provide that, notwithstanding the general prohibition on a Director
nominated by a shareholder of LCH Group from sharing information with
the shareholder of LCH Group without the consent of the independent
non-executive Directors of the Board, information may be shared with
LSEG, in its capacity as an indirect shareholder of LCH SA, for legal,
accounting, tax regulatory or disclosure purposes.
Article 15, Committees of the Board, will be amended to
note (i) the addition of a new committee, the Technology, Security and
Resilience Committee, and (ii) that the Group Nomination Committee is
now the Nomination Committee, i.e., a committee of LCH SA.
Article 16, Audit Committee, will be amended to remove the
requirement that the ToR of the Audit Committee must be substantially
similar to the terms of reference of the Audit Committee of LCH Group
(as this will no longer exist) and to recognize that changes in the ToR
may be required by LCH SA's regulators (and not LCH Group's regulators)
or any applicable law or regulation. The ToR must be reviewed annually
by the Board, and (ii) are subject to the approval of the Board and to
the consent of LSEG, in respect of the rights of LSEG under the ToR.
Finally, the amended Article 16 will confirm that a Director
representing LSEG and a Director representing Euronext will be a part
of the Audit Committee.
Article 17, Risk Committee, will confirm that a Director
representing LSEG will be vice-chairman of the Risk Committee. The ToR
must be reviewed annually by the Board, and (ii) are subject to the
approval of the Board and to the consent of LSEG, in respect of the
rights of LSEG under the ToR.
Article 18, Nomination Committee, will be amended to
remove any reference to the Group Nomination Committee and the
requirement that, in the event LCH SA establishes its own Nomination
Committee, its ToR must be substantially similar to the terms of
reference of the LCH Group Nomination Committee. As amended, Article 18
will provide that the ToR of the Nomination Committee (i) must be
reviewed annually by the Board, and (ii) are subject to the approval of
the Board and to the consent of LSEG.\16\ In addition, Article 18
confirms that a Director representing LSEG will be a member of the
Nomination Committee.
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\16\ Note that, under Article 18, LSEG's consent is required for
any amendment of the ToR of the Nomination Committee, not just
amendments to LSEG's rights under the ToR. The reason for this
slightly wider consent right (compared to other ToRs) is that the
LCH Group Nomination Committee ToR required LSEG consent for any
amendment, and the Relationship Agreement required any CCP
Nomination Committee to have substantially similar terms to the LCH
Group Nomination Committee ToR.
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Article 19, Remuneration Committee, will be amended to
remove the provision requiring the ToR to take into account the
remuneration policies and principles of the LCH Group Remuneration
Committee (which is being disbanded). However, the requirement to take
into account the remuneration policies and principles applied by LSEG
for its executive management remains. Any change in LSEG's rights under
the ToR is subject to LSEG's consent. Finally, Article 19 confirms that
a Director representing LSEG will be a member of LCH SA's Remuneration
Committee.
Article 20, Technology, Security and Resilience Committee,
is a new article that recognizes the establishment of the Technology,
Security and Resilience Committee, and provides that its organization
and functions will be set out in a ToR, which are reviewed annually and
subject to the approval of the Board.
Article 25, Related party agreements between LCH SA and a
manager, a Director or a shareholder, will be amended to provide that
any contracts and agreements between LCH SA and LSEG or any member of
the LSEG Group,\17\ will be subject to the prior approval of a
committee of the Board consisting solely of the independent non-
executive directors of LCH SA. The article further provides that
approval will be given provided that the contract or agreement is on
bona fide arm's length terms. The committee's determination will be
final.
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\17\ LSEG Group means London Stock Exchange Group plc and its
subsidiaries from time to time other than those entities comprising
the LCH Group.
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New Article 26, Group Compliance, will provide that, in
light of LSEG's obligations under the Financial Conduct Authority's
Listing Rules, the Board will notify LSEG of any proposed transaction
in relation to LCH SA or of which the Board is otherwise aware that may
constitute for LSEG either (i) a significant transaction under Listing
Rule 10, or (ii) a related party transaction under Listing Rule 11.
Further, if LSEG informs the Board that the proposed transaction
constitutes a transaction (or other relevant matter) under Listing Rule
10 or 11, the transaction will not take place without the prior
approval of LSEG.
New Article 27, Amendment, will provide that the Board ToR
may be amended by the Board, provided that any changes to LSEG's rights
or any changes which would otherwise have a detrimental effect on
LSEG's rights pursuant to the ToR will be subject to LSEG's consent.
Terms of Reference of the Nomination Committee
As noted earlier, as a part of the LCH Group governance changes,
the committees of the Board of LCH Group will be disbanded. Therefore,
LCH SA will establish its own Nomination Committee. Although this ToR
is entirely new to LCH SA, it is based in substantial part on the
provisions of the Group Nomination Committee applicable to LCH SA.
The structure of the Board established under the Nomination
Committee ToR will be essentially the same as it is today.
Specifically, Article 2, Purpose, will provide that the Nomination
Committee will recommend: (i) An independent Chairman; (ii) up to four
independent directors; (iii) up to two User Directors; (iii) a director
nominated by LSEG; and (iv) a director nominated by Euronext.\18\ In
addition, the Board will have three Executive Directors: (a) The CEO of
LCH SA; (b) the CEO of LCH Group; and (c) the chief risk officer of LCH
Group, or ``such other officer as may be proposed by the Group CEO''.
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\18\ Although both LSEG and Euronext are entitled to recommend
the candidate to serve as a Director of the Board, the candidates
are subject to consideration by the Nomination Committee and may be
rejected if the Nomination Committee determines the candidate is not
appropriate. In considering the candidates, the Nomination Committee
will take into account (i) the seniority, experience, skill and
expertise of each candidate, and (ii) the regulatory good standing
of each candidate. ToR Articles 3 and 4.
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As discussed above, under the Nomination Committee ToR, there will
be no change in the proportion of independent directors or the number
of directors representing members and participants. It should be noted,
however, that the Group Nomination Committee ToR had provided for up to
two representatives of Venues. As explained earlier, with the exception
of Euronext, there have been no Venue representatives on the LCH SA
Board for some time. Because Euronext is entitled to Board
representation through its contractual arrangements, i.e., the Cash
Clearing Agreement and Derivatives
[[Page 48299]]
Clearing Agreement, LCH SA has determined that there is no reason to
provide for additional Venue directors in the LCH SA Nomination
Committee ToR.
Article 5, Executive Management Team, will provide that LCH SA's
CEO, in consultation with the LCH Group CEO will be responsible for
appointing the management team for LCH SA. This provision is intended
to ensure independence at the CCP level.
Article 6, Duties and Powers of the Committee, will set out the
duties and powers of the Nomination Committee. Among other duties, the
committee must: (i) Be satisfied that candidates understand the
responsibilities of Board membership and be able to devote to necessary
time to LCH SA matters; (ii) ensure that its recommended candidates are
respected for their competence and are of good standing in their field
of business; and (iii) keep itself informed of any changes in law or
regulations applicable to the composition of the Board and other
matters for which the committee is responsible.\19\
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\19\ The Committee is also directed to consult periodically with
the nomination committee of LCH Limited to ensure that there is a
coordinated process for the appointment of suitable directors to the
Board and the board of directors of LCH Limited.
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Article 7, Procedures of the Committee, will set out the procedures
of the Nomination Committee. As they relate to the appointment of the
Chairman and the Independent Directors, Article 7 will provide that the
committee will maintain a short list of potential candidates and
consult with the CEO of LCH Group and the CEO and the Chairman of LSEG
as to the suitability of the candidates. With regard to the appointment
of a new Chairman, the committee will also consult with the Independent
Directors.
Article 7 further provides that, in determining whether a candidate
is fit for appointment as Chairman or as an Independent Director, the
committee will consider whether there are relationships or
circumstances (including with LSEG or any member of LSEG Group) likely
to affect such person's judgment and whether the candidate has a
relationship that would disqualify such person as a ``public director''
within the meaning of CFTC rules in force from time to time or as an
``independent director'' under any corporate governance standards
applicable from time to time, or which the Board otherwise determines
should be complied with in the interests of best practice corporate
governance.\20\
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\20\ If a recommended candidate appears to have any
relationships that might call into question the candidate's
independence, the committee must specify why it believes the
candidate is nonetheless independent.
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Finally, in making recommendations with regard to Independent
Directors, the committee will take into account that there should be
among the Independent Directors: (i) A breadth of industry expertise
and experience and product knowledge; (ii) particular expertise and
experience in each of risk management, audit, clearing services and
financial services; and (iii) diversity, including gender, age,
geographical provenance, and educational and professional background.
The procedures for the appointment of User Directors are set out in
Appendix to Article 7 (``Appendix''). Under these procedures, if a User
Director retires from the Board, the committee may invite an ``Eligible
User'', as defined,\21\ to nominate a candidate for appointment as a
User Director on the Board (a ``Nominating User'').\22\ In selecting
Nominating Users, the committee will consider those Eligible Users that
the committee considers most likely to promote the success of LCH SA,
having regard for: (i) The number of each Eligible User's contracts or
trades (as the case may be) cleared by any member of LCH Group in the
immediately preceding 12 months; (ii) any other contribution made to
LCH Group's business by each Eligible User, including without
limitation assistance provided to LCH Group in the development of new
projects and the introduction to LCH Group of new clearing clients;
(iii) the size of each Eligible User's shareholding in LCH Group; and
(iv) how recently (if at all) the relevant Eligible User has been
represented on any LCH Board, and the desirability of achieving a
reasonably fair rotation of appointees among Eligible Users.
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\21\ As defined in the Appendix, an ``Eligible User'' is a User
Shareholder, i.e., a clearing member that is also a shareholder of
LCH Group, that is not connected with an existing director (other
than a director that is retiring or removed in accordance with the
Appendix) and has not served notice terminating its clearing
relationship with any member of LCH Group.
\22\ In addition to retiring voluntarily from the Board, a User
Director must retire if the User Director: (i) Retires or is removed
as a result of the User Shareholder which nominated the User
Director ceasing to be an Eligible User; (ii) retires or is removed
as a result of their ceasing to be employed by, or for any other
reason upon request by, the User Shareholder which nominated the
User Director; (iii) retires or is removed following a change of
role within the User Shareholder, if such role change would result
in the User Director concerned no longer being able to maintain the
relevant skill and expertise; or (iv) is disqualified or removed in
accordance with the LCH SA's articles of association.
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In deciding whether to approve a candidate for appointment to the
Board (each, an ``Approved Candidate''), the committee will have regard
for: (i) The seniority, experience, skill and expertise of each
candidate; (ii) the regulatory good standing of each candidate; (iii)
the desirability of having deep expertise on a wide range of products,
including those which pose the greatest risk challenges for LCH SA from
time to time; and (iv) the desirability of having significant
experience and expertise in LCH SA's principal markets; and (v) the
desirability of diversity on the Board, including gender, age,
geographical provenance, and educational and professional background.
From the Approved Candidates, the committee selects a number of
``Proposed Directors'' that is equal to the number of User Directors
that are retiring from the Board and presents the Proposed Directors to
LSEG for approval. If LSEG does not approve a Proposed Director, the
Nominating User may accept LSEG's decision, in which case, the
committee may select another Proposed Director from among the Approved
Candidates to be put to LSEG for approval, or the Nominating User may
propose one or more alternative candidates to be considered and, if
approved, be put to LSEG for approval.\23\ Upon approval of a Proposed
Candidate by LSEG, the committee will recommend the Proposed Director's
appointment to the Board.
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\23\ The committee is not required to select the alternative
candidate as a Proposed Candidate.
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Article 8, Tenure of Directors, will provide that each director
(other than the Executive Directors and User Directors) will have, in
principle, a maximum tenure on the Board of three three-year terms.
However, the Committee may nominate an Independent Director for such
longer period as is necessary to ensure that not all such Independent
Directors' appointments terminate at the same time. All User Directors
will have a tenure on the Board of one three-year term, unless
otherwise agreed by the Board to ensure that not all such User
Directors' appointments terminate at the same time. Article 8 further
provides that the terms of appointment of each User Director will
provide that the User Director must retire from the Board if any of the
circumstances set out in sub-paragraphs 2(a) through 2(e) of the
Appendix occurs.\24\
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\24\ Paragraphs 2(a) through 2(e) of the Appendix provide that a
User Director must retire if the User Director: (a) Retires of the
User Director's own volition; (b) retires or is removed as a result
of the User Shareholder that nominated the User Director ceasing to
be an Eligible User; (c) retires or is removed as a result of the
User Director ceasing to be employed by, or for any other reason
upon request by, the User Shareholder that nominated the User
Director; (d) retires or is removed following a change of role
within the User Shareholder, if such role change would result in the
User Director concerned no longer being able to maintain the
relevant skill and expertise; or (e) is disqualified or removed in
accordance with LCH SA's Articles of Association.
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[[Page 48300]]
Article 9, Membership of the Nomination Committee, will provide
that the members of the Nomination Committee will be appointed by the
Board and be comprised of four to six directors, including the
Chairman, at least two Independent Directors, one User Director and the
LSEG Director. The Chairman of the Board, or such other Independent
Director as the Independent Directors and LSEG may agree, will be the
Chairman of the committee.
Articles 10 and 12 through 16 will establish the Committee's
policies with regard to the conduct of meetings. In this regard, these
articles provide that: (i) LCH SA's secretary will be the secretary of
the Committee (Article 10); (ii) notice of meetings will be provided by
the secretary or Committee Chairman in a timely manner, along with an
agenda and supporting documents (Article 12); (iii) the Committee will
meet at least twice each year and as necessary to fulfill its duties
(Article 13); (iv) Committee meetings may be held in person, by
telephone, by video conference or any combination thereof, and
decisions may be made by email circulation, provided approval is
unanimous (Article 14); (v) one Independent Director, one User
Director, and the LSEG Director must be in attendance to constitute a
quorum of the Committee, authorized to exercise all authorities of the
Committee (Article 15); and the secretary will prepare minutes of all
Committee meetings, which will be presented to the Committee for
approval at its next meeting.
Article 11, Tenure of Nomination Committee Members, will provide
that, in the event a member of the Committee ceases to be a director or
LCH SA, the member will automatically cease to be a member of the
Committee.
Article 17, Reporting and Reviews, will provide that the Committee
will furnish to the Board for approval each year a summary of (i) its
activities, (ii) the process used to make nominations, (iii) a
description of its policy on diversity (including gender), any
measurable objectives it has set for implementing the policy and
progress on achieving such objectives, and (iv) will either explain if
external advice or search consultants have not been used or, if they
have been used, identify them and state whether they have a connection
with LCH SA.\25\ Article 17 will further require the Committee
Chairman, or the Chairman's designee, to make available to LCH SA's
Chief Compliance Officer (the ``Chief Compliance Officer'') such
information relating to the Committee's work as is necessary for the
Chief Compliance Officer to draft and submit the annual compliance
reports required by the CFTC Rules and other applicable regulations in
force from time to time.
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\25\ Following approval of the Committee's summary, it will be
included as a section in LCH SA's annual report.
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Article 18, Amendment, will provide that the ToR may be amended
with approval of the Board, subject to LSEG's consent.
Article 19, Confidentiality and Conflicts of Interest, will set out
the requirements with respect to confidentiality and conflicts of
interest and provides that all confidential matters considered by the
committee and any confidential information disclosed to members of the
committee in connection with their position as a member of the
committee must remain confidential, notwithstanding the company to
which that information relates, nor whether the member is a director of
that company or not, except as required to be disclosed by law or
regulation. Conflicts of interest relating to committee members will be
governed by the relevant articles in LCH SA's Articles of Association.
Article 20, Other, will provide that (i) the Committee will have
sufficient resources to carry out its duties, (ii) every member of the
Committee will receive a copy of the ToR, and (iii) every member of the
Committee will receive appropriate and timely training, including
access to external consultancy support, when required.
Terms of Reference of the Risk Committee
No substantive changes are proposed to be made to the ToR of the
Risk Committee. The ToR will be amended primarily to reflect the
changes in the LCH Group governing arrangements. For example, (i)
Article 1, Composition, will be revised to reference the criteria for
independence set out in LCH SA's Nomination Committee ToR rather than
in LCH Group's Nomination Committee ToR, and (ii) Article 16,
Confidentiality and Conflicts of Interest, will be revised to remove
reference to any rights LSEG may have in the Relationship Agreement and
refer, instead, to rights LSEG or its representatives have under this
ToR.
Article 1 will also been amended to remove as unnecessary the
provision that authorized LSEG to appoint the Vice Chairman of the
committee only for so long as LSEG is entitled to exercise or control
the exercise of at least 40 percent of the votes able to be cast on all
or substantially all matters at general meetings of LCH SA. Provided
such person has the skills and experience commensurate with such a
role, LSEG will be entitled to appoint the Vice Chairman of the
committee without restriction.\26\
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\26\ Article 17 of the ToR, Harmonization with LCH Limited, will
be amended to remove references to LCH LLC. LCH LLC is registered
with the CFTC as a DCO, although its registration is currently
dormant.
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Article 20, Other, will be amended to provide that LSEG must
consent to any amendments to: (i) Paragraph 1.2.6, recognizing the
authority of LSEG's Head of Financial Risk (or delegate) to attend
meeting of the Risk Committee; (ii) paragraph 1.4, authorizing LSEG to
appoint the Vice Chairman of the committee; (iii) paragraph 16.1,
relating to confidentiality and conflicts of interest; and (iv)
paragraph 20.6, recognizing the provisions of the ToR requiring LSEG's
consent. Further, no provisions of ToR may be amended without the
approval of the Board.
Terms of Reference of the Audit Committee
No substantive changes are proposed to be made to the ToR of the
Audit Committee. However, Article 2, Structure and Membership, will be
revised to reference the criteria for independence set out in LCH SA's
Nomination Committee ToR rather than in LCH Group's Nomination
Committee ToR and, further, will be amended to provide that one member
of the Audit Committee will be a director recommended or approved by
LSEG.\27\
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\27\ Article 2 will also be amended to remove as unnecessary
references to the Relationship Agreement and the paragraph providing
that LSEG will have the authority to appoint a member of the
committee only for so long as LSEG is entitled to exercise or
control the exercise of at least 20 percent of the votes able to be
cast on all or substantially all matters at general meetings of LCH
Group.
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Article 3, Authority and Responsibilities, will be amended to
remove the requirement that LCH SA's Audit Committee coordinate with
the Audit Committee of LCH Group. However, Article will be amended to
require the committee to coordinate with the Technology, Security and
Resilience Committee.\28\ In addition,
[[Page 48301]]
Article 3 will be amended to recognize that LCH SA has more than one
External Auditor, and provide that, in making recommendations to the
Board concerning the appointment, evaluation and termination of the
engagement of the External Auditors for LCH SA, the Committee will take
into account the auditor appointed by LSEG in respect of the wider LSEG
Group. Article 3 will also be amended to provide that the Committee
will review the annual audit plan prepared by LCH SA's Internal Audit
department after approval by the LCH SA's CEO and ahead of any
submission of the plan to LCH SA's regulator, if requested by the
regulator. Finally, Article 3 will be amended to remove the requirement
that the Committee respond to any requests from the LCH Group Audit
Committee (which is being disbanded) to vary LCH SA's internal audit
program of work.
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\28\ The Committee's obligation to coordinate with the LCH SA
Risk Committee is unchanged.
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Article 5, Reporting, will be amended to confirm that Committee
secretary will present all minutes of the proceedings and resolutions
of all Committee meetings to the Committee for approval at the next
following meeting.
Current Article 8, Annual Evaluation and Terms of Reference Review,
which provides that the Committee will arrange for periodic reviews of
its own performance and, at least annually, arrange for independent
internal review of its constitution and these Terms of Reference, will
be removed. This review is conducted, instead, by the Board and
executive management.
Article 8, Amendments, will be added, which will specify those
provisions of the ToR that may be approved solely by the Board and
those provisions that will also require LSEG's consent.
Terms of Reference of the Remuneration Committee
The ToR of the Remuneration Committee will be amended to reflect
some minor changes in the remuneration process. For example, Article 1,
Duties and Powers of the Committee will be revised to provide that the
remuneration policies will apply to ``Specified Executives'' rather
than ``Executive Management''. This is a technical change to confirm
that the remuneration policies will apply only to those executives
identified in the ToR or otherwise specified by the Board and will not
apply to other LCH SA executives who otherwise might be deemed to fall
within the category of ``Executive Management'' for other purposes. As
defined, ``Specified Executives'' means, with respect to LCH SA, the
Executive Directors, the CEO, the Chief Risk Officer, the Chief
Compliance Officer, and any other personnel designated by the Board
from time to time.\29\ Further, the process by which the remuneration
of the CEO or any Specified Executive may be submitted for approval by
the Board and, subsequently, the LSEG remuneration committee will be
simplified by removing the requirement that the Committee consult with
the Chief Executive Officer of LSEG when making any change in the
remuneration (including salary, bonus and long term incentives) of the
CEO or any Specified Executive. It was determined that requiring the
Committee to consult with the Chief Executive Officer of LSEG at the
start of the process with regard to any changes in the remuneration of
the LCH SA CEO or any Specified Executive is unnecessary, since the
approval of the LSEG Remuneration Committee is required as a final
step.\30\ Article 1 will also be amended to require the Committee to
review annually the ongoing appropriateness of any individual
remuneration and to review for approval by the Board the design of all
incentive plans and performance related pay schemes, including
performance targets to be used, that are designed by and received from
the LSEG remuneration committee.
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\29\ ``Specified Executives'' also include any personnel with an
annual remuneration package of more than [euro]1,000,000 or
equivalent, and the Chairman of the Board.
\30\ With regard to the remuneration of directors, Article I
will be amended to provide that the committee will consult from time
to time with the remuneration committee of LSEG and the remuneration
committee of LCH Limited to ensure that there is a coordinated
approach to the remuneration of directors on the Board and the board
of directors of LCH Limited.
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Article 2, Composition of the Committee, will be revised to remove
as unnecessary the provision that LSEG is entitled to appoint a
representative to the committee only for so long LSEG is entitled to
exercise or control the exercise of at least five percent of the votes
able to be cast on all or substantially all matters at general meetings
in Group.\31\ LSEG will be entitled to appoint a representative to the
committee at all times. Article 2 will also authorize the LCH Group CEO
to attend committee meetings as an observer.
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\31\ Article 14, Other, will also be amended to remove the
general provision that the rights of LSEG set out in the ToR will
cease automatically if LSEG ceases to be entitled to exercise or
control the exercise of at least five percent of the votes able to
be cast on all or substantially all matters at general meetings of
LCH Group.
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Article 10. Amendment, will be amended to confirm those paragraphs
of the ToR that may only be amended with the approval of the Board and
the consent of LSEG.
Article 12, Confidentiality and Conflicts of Interest, will be
revised to remove reference to any rights LSEG may have in the
Relationship Agreement and refer, instead, to rights LSEG or its
representatives have under this ToR.
Terms of Reference of the Technology, Security and Resilience Committee
Unrelated to the changes in its governance arrangements described
above, LCH SA has also established ToR for a Technology, Security and
Resilience Committee of the Board.
Article 1, Purpose, will provide that the purpose of the Committee
is to ``represent the interests of the Board in the sound management of
technology, security and operational resilience, including cyber
security, to ensure that technology security and operational resilience
strategies, investments and outcomes support the mission, values, and
strategic goals'' of LCH SA, and determine whether management has put
in place adequate strategies that provide reasonable assurance that LCH
SA ``operates within its risk appetite and complies with regulatory
requirements.''
To this end, the Committee will assist the Board in fulfilling its
responsibilities relating to, inter alia: (i) Review of LCH SA's
Operations and Technology Strategy; (ii) review of significant
investments in support of this strategy including application and
infrastructure architecture; (iii) review of the frameworks, policies
and strategies that set the internal control environment in relation to
technology, security and operational resilience; (iv) review of the
Operational Risk Management Framework; (v) review of LCH SA's Strategy
for Cyber Security and Information Security and for delivery of
supporting programs; (vi) review of the integration of Digital and
Physical Security and their alignment with Business Continuity Plans;
and (vii) providing regulatory attestations or declarations as may be
required from time to time in relation to technology, security and
operational resilience.
Article 2, Structure and Membership, will provide that the
Committee will be comprised of at least four directors of the Board. At
least two members of the Committee will be Independent Directors, one
of whom will be appointed by the Chairman of the Committee. Both
Independent Directors must satisfy the criteria for independence set
out in the ToR of the Nomination Committee. One member of the Committee
must also be a member
[[Page 48302]]
of the Audit Committee.\32\ All Committee members will be appointed by
the Board in consultation with the Committee Chairman.
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\32\ The Committee as a whole should have a breadth of
experience to enable alignment with financial risk management,
regulatory requirements and audit. Ideally, members of the Committee
will also have significant, recent and relevant experience of the
operations of LCH SA and its dependence on technology.
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Article 2 will further provide that he Committee will meet as
frequently as it determines necessary but must meet no less frequently
than three times a year. Two members of the committee will constitute a
quorum, provided at least one member is an independent director.
Remuneration of the Committee members will be determined by the Board,
and no member of the Committee may receive any consulting, performance,
advisory or other compensatory fee from LCH SA other than fees paid in
member's capacity as a member of the Board or as a member of a
Committee of the Board.
Article 3, Reports to the Committee, will provide that the
Committee will receive and review periodic management information for
relevant operations and technology metrics and will align its meeting
schedule with the requirements of the Board.
Article 4, Authority and Responsibilities, will describe the
specific functions of the Committee, including: (i) Reviewing LCH SA's
operations and technology strategy and policies including application
and infrastructure architecture; (ii) reviewing and, as appropriate,
making recommendations to the Board regarding significant technology
investments in support of LCH SA's technology strategy; (iii) reviewing
and, as appropriate, making recommendations to the Board regarding the
resources and delivery of LCH SA's technology programs; (iv) reviewing
any information technology resilience, cyber and information security
programs, tracking progress in relation to such programs and providing
reports to the Board as appropriate; (vi) reviewing any significant
operations and technology risk exposures of LCH SA, including any
detailed operational risk assessments with significant information
technology elements and information security and cyber security risks,
together with the steps management has taken to monitor and control
such exposures; (vii) reviewing LCH SA's integrated security and
resilience, including review of any new or novel approaches to
information technology including security and resilience; (viii)
reviewing reports from management regarding LCH SA's Business
Continuity Management planning; (ix) receiving reports, as appropriate,
from the Audit Committee regarding the results of reviews and
assessments of LCH SA's operations and technology functions; and (x)
reviewing reports, as appropriate, on operations and agreed metrics in
conjunction with the Audit Committee.
Article 5, Provisions for Access, will confirm that the Committee
(i) will have full and unrestricted access to management and employees
of LCH SA and other members of the LCH Group, (ii) may obtain
independent professional advice and the assistance of relevant experts
outside of LCH SA, and (iii) will have full and unrestricted access to
any systems, records, facilities or other data from LCH SA or other
member of LCH Group that it requires to carry out its functions.
Article 6, Reporting, will provide that the Committee Chairman will
report the Committee's discussions, decisions and recommendations to
the Board, which will decide on an appropriate policy response.\33\
Further, the Committee Chairman, or the Chairman's designee, will make
available to LCH SA's Chief Compliance Officer such information
relating to the Committee's work as is necessary for the Chief
Compliance Officer to draft and submit the annual compliance reports
required by applicable regulations in force from time to time.
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\33\ The Committee will have no executive powers with respect to
its findings and recommendations.
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Article 7, Confidentiality and Conflicts of Interest, will set out
the requirements with respect to confidentiality and conflicts of
interest and provides that all confidential matters considered by the
Committee and any confidential information disclosed to members of the
Committee in connection with their position as a member of the
Committee must remain confidential, notwithstanding the company to
which that information relates, nor whether the member is a director of
that company or not, except as required to Committee members will be
governed by the relevant articles in LCH SA's Articles of Association.
2. Statutory Basis
LCH SA has determined that Proposed Rule Change is consistent with
the requirements of Section 17A of the Act \34\ and regulations
thereunder applicable to it. In particular, Section 17A(b)(3)(C) of the
Act provides that the rules of a clearing agency must assure fair
representation of its members and participants in the selection of its
directors and the administration of its affairs.
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\34\ Id.
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As noted above, the Proposed Rule Change will not lead to any
change in the proportion of independent directors or the number of
directors representing members and participants. Therefore, the Board
and the committees of the Board will continue to assure fair
representation of its members and participants in the selection of its
directors and the administration of its affairs as provided in section
17A(b)(3)(C) of the Act.\35\
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\35\ 15 U.S.C. 78q-1(b)(3)(C).
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Further, Section 17A(b)(3)(F) of the Act \36\ provides that the
rules of a clearing agency must be designed to assure the safeguarding
of securities and funds which are in the custody or control of the
clearing agency. In this regard, the Proposed Rule Change will make no
substantive changes to the risk management policies of LCH SA or,
except as explained immediately below, to the obligations of the Board
with respect to risk management.
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\36\ 15 U.S.C. 78q-1(b)(3)(F).
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The Proposed Rule Change will amend Article 12 of the Board of
Directors ToR to clarify that the Board must approve at least annually
the LCH Group Risk Governance Framework and LCH SA's various policies,
including LCH SA's: (i) Financial Resource Adequacy Policy; (ii)
Default Management Policy; (iii) Collateral Risk Policy; (iv)
Investment Risk Policy; (v) Liquidity Risk Policy; (vi) Settlement,
Payment & Custody Risk Policy; (vii) Counterparty Credit Risk Policy;
(viii) Contract and Market Acceptability Policy; (ix) Model Governance,
Validation & Review Policy; (x) Operational Risk Policy; (xi) and
Procyclicality Policy and any significant changes to those policies
upon recommendations from the Risk Committee.
By making no substantive changes to the risk management policies of
LCH SA or to the obligations of the Board with respect to risk
management and by clarifying the obligation of LCH SA's Board to
approve the above policies annually, which policies collectively assure
the safeguarding of securities and funds which are in the custody or
control of LCH SA, the Proposed Rule Change is consistent with the
requirements of Section 17A(b)(3)(F) of the Act.
Commission Rule 17Ad-22(e)(2) requires each registered clearing
agency to ``establish, implement, maintain and enforce written policies
and procedures reasonably designed to provide for
[[Page 48303]]
governance arrangements that: (i) Are clear and transparent; (ii)
support the public interest requirements in Section 17A of the Act
applicable to clearing agencies, and the objectives of owners and
participants; (iii) specify clear and direct lines of responsibility;
and (vi) consider the interests of participants' customers . . . and
other relevant stakeholders of the covered clearing agency.\37\
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\37\ 17 CFR 240.17Ad-22(e)(2).
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As discussed above, the Proposed Rule Change is being adopted in
significant part to conform LCH SA's Governance Documents to actions
taken by LCH Group to simplify its governing arrangements and to
eliminate provisions in LCH Group's governance documents that are
unnecessary and outdated. Importantly, LCH Group and LSEG have decided
to terminate the Relationship Agreement between them and remove
duplication in board decision-making between LCH Group and the CCP
Boards by making the LCH Group Board an internal only board and
disbanding all LCH Group committees.
By simplifying its governance arrangements and eliminating
provisions in LCH Group's governance documents that are unnecessary and
outdated; by vesting in LCH SA's CEO responsibility for appointing LCH
SA's management team; and by confirming that the Proposed Rule Change
will not lead to any change in the proportion of independent directors
or the number of directors representing members and participants, the
Proposed Rule Change enhances LCH SA's governance arrangements and
assures that they (i) remain clear and transparent (ii) continue to
fulfill the public interest requirements in Section 17A of the Act
applicable to clearing agencies by assuring fair representation of its
members and participants in the selection of its directors and the
administration of its affairs, (iii) support the objectives of members
and participants, (iv) specify clear and direct lines of
responsibility; and (v) consider the interests of participants'
customers . . . and other relevant stakeholders of the covered clearing
agency, within the meaning of SEC Rule 17Ad-22(e)(2).\38\
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\38\ 17 CFR 240.17Ad-22(e)(2).
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B. Clearing Agency's Statement on Burden on Competition
LCH SA does not believe the Proposed Rule Change would have any
impact, or impose any burden, on competition. The Proposed Rule Change
does not address any competitive issue or have any impact on the
competition among central counterparties. LCH SA operates an open
access model, and the Proposed Rule Change will have no effect on this
model.
C. Clearing Agency's Statement on Comments on the Proposed Rule Change
Received From Members, Participants or Others
Written comments relating to the Proposed Rule Change have not been
solicited or received. LCH SA will notify the Commission of any written
comments received by LCH SA.
III. Date of Effectiveness of the Proposed Rule Change
Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) By order approve or disapprove such proposed rule change, or (B)
institute proceedings to determine whether the proposed rule change
should be disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change, security-based swap submission, or advance notice is consistent
with the Act. Comments may be submitted by any of the following
methods:
Electronic Comments
Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
File Number LCH SA-2020-003 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549.
All submissions should refer to File Number SR-LCH SA-2020-003. This
file number should be included on the subject line if email 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, security-based
swap submission, or advance notice that are filed with the Commission,
and all written communications relating to the proposed rule change,
security-based swap submission, or advance notice 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 a.m. and 3:00 p.m. Copies of
the filing also will be available for inspection and copying at the
principal office of LCH SA and on LCH SA's website at: https://www.lch.com/resources/rules-and-regulations/proposed-rule-changes-0.
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-LCH SA-2020-003 and should
be submitted on or before August 31, 2020.
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\39\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\39\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-17346 Filed 8-7-20; 8:45 am]
BILLING CODE 8011-01-P