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2013 OCC Comment Letters

SEC, July 8, 2013
File No. S7-01-13: Proposed Regulation Systems Compliance and Integrity
The SEC proposed Regulation Systems Compliance and Integrity ("Regulation SCI") to formalize and expand many aspects of the SEC's Automation Review Policy ("ARP") statements, expand the scope of those statements to other systems and events and expand the scope of the ARP Inspection Program to other types of entities. In its comment letter, OCC noted that it supports the SEC's efforts to increase safety and security in the national financial market system and appreciates the opportunity to comment on several aspects of proposed Regulation SCI that OCC believes should be improved or clarified before the SEC issues final rules. OCC also noted that there are aspects of the Proposal that will pose significant operational and administrative burdens on OCC and other market participants, and that it wishes to ensure that the SEC has carefully considered whether all such burdens are warranted, given the benefits expected to be achieved by proposed Regulation SCI. Further, OCC noted that it believes certain aspects of the Proposal, while sensible in the abstract, may actually introduce new security threats to and increase the vulnerability of the core systems of entities subject to Regulation SCI, and that the SEC will be able to achieve its goal of increasing safety and security in the national financial markets by modifying or eliminating aspects of the Proposal.

House Ways and Means Committee, April 22, 2013
Comments of the U.S. Securities Markets Coalition on Chairman Camp's Draft Financial Products Tax Reform Proposals
The United States Securities Markets Coalition (the Coalition), which includes all the major options exchanges in the United States, submitted comments to the House Ways and Means Committee on Chairman Dave Camp's (R-MI) draft proposal for financial products tax reform. The Coalition is concerned about the impact that the draft proposal would have on the use of exchange-traded options by individuals, mutual funds and other investors. The draft proposal would effectively impose a tax penalty on individuals and other taxpayers who used exchange-traded options to reduce the risks of owning stocks or to generate additional income from their stock holdings. In addition, by marking to market all options and taxing gains as ordinary income, the draft proposal would result in a higher effective tax rate on options as compared to alternative investments that are not marked to market. The Coalition believes that the draft proposal would result in a significant additional tax burden on exchange-traded options that would greatly harm the listed options markets.