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SECURITIES AND EXCHANGE COMMISSION
Securities and Exchange Commission
DOCUMENT ID: [Release No. 34-54958; File No. SR-NSCC-2006-13]
NOTICE: NOTICES
ACTION: Self-regulatory organizations; proposed rule changes:
SUBJECT CATEGORY: Self-Regulatory Organizations; National Securities Clearing Corporation; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Harmonizing Administrative Provisions With Affiliated Clearing Agencies
DOCUMENT SUMMARY: December 18, 2006.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on November 3, 2006, the
National Securities Clearing Corporation (``NSCC'') filed with the
Securities and Exchange Commission (``Commission'') the proposed rule
change as described in Items I, II, and III below, which Items have
been prepared primarily by NSCC. NSCC filed the proposed rule change
pursuant to Section 19(b)(3)(A)(iii) of the Act \2\ and Rule 19b
4(f)(4) \3\ thereunder so that the proposal was effective upon filing
with the Commission. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons. \1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78s(b)(3)(A)(iii).
\3\ 17 CFR 240.19b4(f)(4).
I. SelfRegulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
The purpose of this filing is to harmonize various administrative
aspects of NSCC's rules with the rules of its clearing agency
affiliates, the Fixed Income Clearing Corporation (``FICC'') and The Depository Trust Company (``DTC'').
II. SelfRegulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, NSCC 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 [[Page 77845]]
in Item IV below. NSCC has prepared summaries, set forth in Sections A,
B, and C below of the most significant aspects of such statements.\4\
\4\ The Commission has modified the text of the summaries prepared by NSCC.
A. SelfRegulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
1. OFAC Status and Securities Eligibility
NSCC's Rule 3 sets forth criteria relating to the eligibility of securities and other financial instruments that underlie contracts that may be cleared through NSCC. NSCC proposes to add new Section 11 to this rule that will contain language that is similar to language in FICC's and DTC's rules. Specifically, the revised rule would provide that securities or other financial instruments of an issuer listed on the Office of Foreign Assets Control (``OFAC'') list of specially designated nationals distributed by the U.S. Department of the Treasury or of an issuer that is incorporated in a country that is on the OFAC list of countries subject to comprehensive sanctions may not be: (a) Submitted to NSCC by a member for processing or (b) requested by members for inclusion on lists of securities or other financial instruments maintained by NSCC pursuant to Rule 3.
2. Forms
Currently, NSCC's Rule 28 states that the delivery of forms of lists, notices, and other documents may be delivered by the use of any media, such as magnetic tape, discs, or cards, as shall be prescribed in NSCC's Procedures. NSCC proposes to remove the language ``such as magnetic tape, discs or cards'' because such modes of delivery are outdated.
3. Signatures
NSCC proposes to amend Rule 32 with respect to acceptable forms of signatures. Currently, this rule permits NSCC to accept documents from members that have been executed using mechanically reproduced facsimile signatures. The proposed rule change modernizes this rule by permitting NSCC, at its option, to rely on any other electronic, optical, or other similar forms of signatures in lieu of original signatures. The new language is adapted from similar language contained in the rule of DTC and both of FICC's divisions (the Government Securities Division and the MortgageBacked Securities Division). In addition, NSCC will revise the title of this rule from ``Facsimile Signatures'' to ``Signatures'' in order to remain consistent with the abovementioned changes.
NSCC believes that the proposed rule changes are consistent with
the requirements of the Act and the rules and regulations thereunder
because they are concerned solely with the administration of NSCC and
do not affect the safeguarding of securities or funds in the custody or control of NSCC or for which it is responsible.
B. SelfRegulatory Organization's Statement on Burden on Competition
NSCC believes that the proposed rule change will have no impact or impose any burden on competition.
C. SelfRegulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others
NSCC has not solicited or received written comments relating to the
proposed rule change. NSCC will notify the Commission of any written comments it receives.
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)(iii) \5\ of the Act and Rule 19b4(f)(4) \6\ thereunder
because it effects a change in an existing service of a registered
clearing agency that does not adversely affect the safeguarding of
securities or funds in the custody or control of the clearing agency or
for which it is responsible and does not significantly affect the
respective rights or obligations of the clearing agency or person using
the service. At any time within 60 days of the filing of the proposed
rule change, the Commission may summarily abrogate 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.
\5\ 15 U.S.C. 78s(b)(3)(A)(iii).
\6\ 17 CFR 240.19b4(f)(4).
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
Paper Comments
All submissions should refer to File No. SRNSCC200613. 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 Web site (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 inspection and copying in the Commission's Public Reference Section, 100 F Street, NE., Washington, DC 20549. Copies of such filing also will be available for inspection and copying at NSCC's principal office and on NSCC's Web site at http://www.nscc.com/legal/index.html. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submission should refer to File No. SRNSCC200613 and should be submitted on or before January 17, 2007.
For the Commission by the Division of Market Regulation, pursuant to delegated authority.\7\
\7\ 17 CFR 200.303(a)(12).
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E622084 Filed 122606; 8:45 am]
BILLING CODE 801101P
SUMMARY: National Securities Clearing Corp.,
DOCUMENT BODY 2: December 18, 2006.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on November 3, 2006, the
National Securities Clearing Corporation (``NSCC'') filed with the
Securities and Exchange Commission (``Commission'') the proposed rule
change as described in Items I, II, and III below, which Items have
been prepared primarily by NSCC. NSCC filed the proposed rule change
pursuant to Section 19(b)(3)(A)(iii) of the Act \2\ and Rule 19b
4(f)(4) \3\ thereunder so that the proposal was effective upon filing
with the Commission. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons. \1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78s(b)(3)(A)(iii).
\3\ 17 CFR 240.19b4(f)(4).
I. SelfRegulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
The purpose of this filing is to harmonize various administrative
aspects of NSCC's rules with the rules of its clearing agency
affiliates, the Fixed Income Clearing Corporation (``FICC'') and The Depository Trust Company (``DTC'').
II. SelfRegulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, NSCC 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 [[Page 77845]]
in Item IV below. NSCC has prepared summaries, set forth in Sections A,
B, and C below of the most significant aspects of such statements.\4\
\4\ The Commission has modified the text of the summaries prepared by NSCC.
A. SelfRegulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
1. OFAC Status and Securities Eligibility
NSCC's Rule 3 sets forth criteria relating to the eligibility of securities and other financial instruments that underlie contracts that may be cleared through NSCC. NSCC proposes to add new Section 11 to this rule that will contain language that is similar to language in FICC's and DTC's rules. Specifically, the revised rule would provide that securities or other financial instruments of an issuer listed on the Office of Foreign Assets Control (``OFAC'') list of specially designated nationals distributed by the U.S. Department of the Treasury or of an issuer that is incorporated in a country that is on the OFAC list of countries subject to comprehensive sanctions may not be: (a) Submitted to NSCC by a member for processing or (b) requested by members for inclusion on lists of securities or other financial instruments maintained by NSCC pursuant to Rule 3.
2. Forms
Currently, NSCC's Rule 28 states that the delivery of forms of lists, notices, and other documents may be delivered by the use of any media, such as magnetic tape, discs, or cards, as shall be prescribed in NSCC's Procedures. NSCC proposes to remove the language ``such as magnetic tape, discs or cards'' because such modes of delivery are outdated.
3. Signatures
NSCC proposes to amend Rule 32 with respect to acceptable forms of signatures. Currently, this rule permits NSCC to accept documents from members that have been executed using mechanically reproduced facsimile signatures. The proposed rule change modernizes this rule by permitting NSCC, at its option, to rely on any other electronic, optical, or other similar forms of signatures in lieu of original signatures. The new language is adapted from similar language contained in the rule of DTC and both of FICC's divisions (the Government Securities Division and the MortgageBacked Securities Division). In addition, NSCC will revise the title of this rule from ``Facsimile Signatures'' to ``Signatures'' in order to remain consistent with the abovementioned changes.
NSCC believes that the proposed rule changes are consistent with
the requirements of the Act and the rules and regulations thereunder
because they are concerned solely with the administration of NSCC and
do not affect the safeguarding of securities or funds in the custody or control of NSCC or for which it is responsible.
B. SelfRegulatory Organization's Statement on Burden on Competition
NSCC believes that the proposed rule change will have no impact or impose any burden on competition.
C. SelfRegulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others
NSCC has not solicited or received written comments relating to the
proposed rule change. NSCC will notify the Commission of any written comments it receives.
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)(iii) \5\ of the Act and Rule 19b4(f)(4) \6\ thereunder
because it effects a change in an existing service of a registered
clearing agency that does not adversely affect the safeguarding of
securities or funds in the custody or control of the clearing agency or
for which it is responsible and does not significantly affect the
respective rights or obligations of the clearing agency or person using
the service. At any time within 60 days of the filing of the proposed
rule change, the Commission may summarily abrogate 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.
\5\ 15 U.S.C. 78s(b)(3)(A)(iii).
\6\ 17 CFR 240.19b4(f)(4).
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
Paper Comments
All submissions should refer to File No. SRNSCC200613. 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 Web site (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 inspection and copying in the Commission's Public Reference Section, 100 F Street, NE., Washington, DC 20549. Copies of such filing also will be available for inspection and copying at NSCC's principal office and on NSCC's Web site at http://www.nscc.com/legal/index.html. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submission should refer to File No. SRNSCC200613 and should be submitted on or before January 17, 2007.
For the Commission by the Division of Market Regulation, pursuant to delegated authority.\7\
\7\ 17 CFR 200.303(a)(12).
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E622084 Filed 122606; 8:45 am]
BILLING CODE 801101P
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14 CFR Part 39 40 CFR Part 52 14 CFR Part 71 33 CFR Part 165 50 CFR Part 679 47 CFR Part 73 26 CFR Part 1 40 CFR Part 180 33 CFR Part 117 50 CFR Part 17 44 CFR Part 67 50 CFR Part 648 14 CFR Part 97 33 CFR Part 100 40 CFR Part 63 50 CFR Part 622 44 CFR Part 65 50 CFR Part 660 26 CFR Part 301 39 CFR Part 111 40 CFR Part 300 6 CFR Part 5 40 CFR Part 271 47 CFR Part 64 40 CFR Parts 52 and 81 44 CFR Part 64 10 CFR Part 50 49 CFR Part 571 50 CFR Part 665 47 CFR Part 76