OCC Proposes Amended Agreements with Options Exchanges Nationwide
Published Date: 5/29/2025
Notice
Summary
The Options Clearing Corporation (OCC) wants to update its agreement with all the national stock exchanges that list equity options. This new agreement cleans up old rules, improves how they work together, and reflects recent legal changes. No extra costs or rule changes for traders, and the update is set to roll out soon after approval.
Analyzed Economic Effects
6 provisions identified: 3 benefits, 1 costs, 2 mixed.
Cyber Incidents Can Pause OCC Services
If a cyber-related disruption to a Regulation SCI system could materially affect OCC's ability to provide services for an exchange, OCC may take steps to mitigate impacts, including suspending its obligations for that exchange until the incident is resolved. Any trades accepted by OCC before a suspension would not be affected. Exchanges and OCC must exchange emergency contact information and maintain required connectivity, including redundant links, with at least 60 days' notice for changes.
Options Stay Tradable Until Positions Close
If an exchange decides to delist an option, it must keep the option listed and make trading available until all open interest in that option is closed out at OCC. This change is intended to reduce the risk that Clearing Members or traders are left with positions that have no way to be closed.
Singly-Listed Options: Exchange Must Help Settle
When an option is listed on only one exchange and the underlying price is unavailable, inaccurate, or unreliable, the listing exchange must work with OCC to determine a reliable settlement price. The listing exchange must also use commercially reasonable efforts to keep the option listed until open interest is closed or take steps to move listing/trading to an alternate exchange.
OCC Can Block New Products That Raise Risk
OCC may disapprove a new option product proposed by an exchange if the product materially impacts OCC's risk profile, presents new risk, affects OCC's risk models, or creates third-party risk. OCC must work with the exchange to mitigate the risk if feasible or notify the exchange of disapproval, and exchanges must submit new products in accordance with the Options Listing Procedure Plan (OLPP).
Which Underlyings OCC Will Clear Changes
The agreement updates the list of permitted underlying interests that OCC may clear: it adds exchange-traded funds (ETFs), American Depository Receipts (ADRs), American Depository Shares (ADS), exchange-traded notes (ETNs), and securities indexes, and removes U.S. Treasury bonds/notes/bills, top-tier bank certificates of deposit, GNMA mortgage pass-through securities, and corporate debt securities from the explicit list. OCC retains board-approved flexibility to add other conforming instruments.
Limits on Use and Redistribution of Exchange Data
The new agreement gives OCC a license to use exchange-provided data for clearing, education, and regulatory work but bars OCC from creating indices or investment products from Exchange Data without consent. OCC may redistribute certain data to third parties (for example, Clearing Members) only under written market data agreements and generally may not redistribute real-time data. Exchanges keep ownership of Exchange Data and may audit OCC's use; Exchanges generally must give OCC at least 60 days' notice before changing Exchange Data.
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