OCC Comment on Financial Data Transparency Act Joint Data Standards Rulemaking
The Options Clearing Corporation (“OCC”) appreciates the opportunity to comment on the above-referenced proposal (“Proposal” or “Proposed Rules”) published jointly by the Office of the Comptroller of the Currency, Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, National Credit Union Administration, Consumer Financial Protection Bureau, Commodity Futures Trading Commission (“CFTC”), Securities and Exchange Commission (“SEC”), Federal Housing Finance Agency, and Department of the Treasury (together, the “Agencies”). The Agencies are proposing these rules as required by the Financial Data Transparency Act of 2022 (“FTDA”). The Proposal would establish data standards to promote interoperability of financial regulatory data across the Agencies. The data standards established pursuant to this rulemaking would later be adopted in separate rulemakings or through other actions taken by the Agencies.
About OCC
Founded in 1973, OCC is the world’s largest equity derivatives clearing organization. OCC operates under the jurisdiction of both the SEC and the CFTC. As a registered clearing agency under the SEC’s jurisdiction, OCC is the sole clearing agency for equity options listed on national securities exchanges. As a registered Subpart C Derivatives Clearing Organization (“DCO”) under the CFTC’s jurisdiction, OCC clears and settles transactions in futures and options on futures. OCC also provides central counterparty clearing and settlement services for securities lending transactions. In addition, OCC has been designated by the Financial Stability Oversight Council as a systemically important financial market utility (“SIFMU”) under Title VIII of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”). As a SIFMU, OCC is subject to prudential regulation by the FRB. OCC is recognized by the European Securities and Markets Authority as a Tier 1 third-country CCP under Article 25 of the European Market Infrastructure Regulation. OCC operates as a market utility and is owned by five exchanges.
Summary
OCC appreciates the Agencies’ collaboration in furthering the development and application of consistent data standards. OCC supports data harmonization and standardization efforts to promote the interoperability of financial regulatory data. OCC recognizes that the establishment of joint data standards may increase efficiency and reduce the costs of transmitting or sharing data among the Agencies, which may improve the usability of data, including for purposes of managing systemic risk and coordinating and evaluating regulatory and supervisory events, actions, or responses.
OCC understands that financial entities may currently utilize different data standards based on their reporting regimes and, to establish common data standards, financial entities may be required to undertake changes. OCC recognizes that certain costs are necessary to achieve the market benefits of such an initiative. However, OCC respectfully asks the Agencies to minimize any burden on financial entities that is not justified in furtherance of the interoperability of financial regulatory data. In establishing the joint data standards, OCC asks the Agencies to consider how the proposed data standards will be interoperable and how any single data standard will promote high quality data and contribute to transparency and utility. OCC underscores the importance of avoiding both overlapping and conflicting reporting requirements as well as potentially disruptive changes that may lead to operational risk across the financial industry. With this in mind, OCC offers more detailed comments on the Proposal, including on certain proposed amendments to establish common data standards that, if implemented through subsequent Agency rulemaking, would impose new requirements, and discusses the potential investment of time and resources required by the Proposal.