[Federal Register Volume 61, Number 205 (Tuesday, October 22, 1996)]
[Notices]
[Pages 54830-54831]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-27035]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-37826; File No. SR-NASD-96-36]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by National Association of
Securities Dealers, Inc., Relating to Software Subscription and
Maintenance Fees for the CRD System
October 16, 1996.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''), 15 U.S.C. Sec. 78s(b)(1), notice is hereby given that on
October 3, 1996, the National Association of Securities Dealers, Inc.
(``NASD'' or ``Association'') filed with the Securities and Exchange
Commission (``SEC'' or ``Commission'') the proposed rule change as
described in Items I, II, and III below, which Items have been prepared
by the NASD. The NASD has designated this proposal as one establishing
or changing a fee under Section 19(b)(3)(A)(ii) of the Act, which
renders the rule effective upon the Commission's receipt of this
filing. The Commission is publishing this notice to solicit comments on
the proposed rule change from interested persons.
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Pursuant to the provisions of Section 19(b)(1) of the Act, the NASD
is herewith filing a proposed rule change to Schedule A of the NASD By-
Laws. Below is the test of the proposed rule change. Proposed new
language is italicized.
Schedule A to the NASD By-Laws
Section 15 Fees for Central Registration Depository
(a) Each member shall be assessed a Software Subscription Fee of
$300 for each copy of CRD software purchased. Each member shall be
assessed a fee of $10.00 for each set of Branch Filing Software.
(b) Each member shall be assessed an annual Software Subscription
Maintenance Fee of $300 for each copy of the CRD software purchased by
the member.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the NASD included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rue change. The text
of these statements may be examined at the places specified in Item IV
below. The NASD 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
Since 1992, the NASD has undertaken an extensive redesign effort to
improve the Central Registration Depository (``CRD'') and move toward
total electronic filing of registration-related forms. The central
focus of the redesign effort is to provide efficient, reliable and
effective state-of-the-art systems and procedures at reasonable cost to
support licensing and regulation of the securities industry.
Implementation of electronic filing will eliminate delays in processing
information in hard copy. The redesigned CRD will offer efficient
processing of registration-related filings and user friendly access to
information contained in those filings for all industry and regulatory
participants.
Two types of software will be available to be purchased by member
firms. The ``Main Office'' software will
[[Page 54831]]
contain the total package of registration, communications, and e-mail
software. This software will be contained in one compact disk (CD-ROM).
The NASD will charge a $300 software subscription fee for each copy of
the Main Office software purchased. The ``Branch Filing'' software, a
subset of the Main Office package, will be available on 3\1/2\''
diskettes and will enable firms to create an Initial U-4/DRP filing
off-line for processing through the Main Office software functionality.
The NASD will charge $10.00 for each set of Branch Filing software
purchased.
An annual software subscription fee of $300 will be charged to
offset the manufacture, packaging, and distribution of future releases
of the software. Updated versions will be manufactured and shipped each
year. These versions will contain enhancements to prior versions and
are deemed necessary to keep all software current. This fee will be
assessed for each copy of the software maintained by the firm.\1\
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\1\ NASD member firms that had fewer than 50 registered
representatives on April 26, 1996, may comply with the NASD's
requirement to file electronically with the new CRD system through
any of three methods: (1) They may file electronically on their own
by purchasing the NASD's software; (2) they may utilize a third
party vendor to file on their behalf; or (3) through December 31,
1997, for a prescribed fee, these firms may file paper forms with
the NASD which will process the forms through its own internal
processing unit. Securities Exchange Act Release No. 37439 (July 15,
1996); 61 FR 37950 (July 22, 1996) (File No. SR-NASD-96-21).
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The NASD believes that the proposed rule change is consistent with
the provisions of Section 15A(b)(5) of the Act which requires that the
rules of the NASD provide for equitable allocation of reasonable dues,
fees, and other charges in that the proposed rule change allows the
NASD to recover the costs of manufacturing, packaging, distributing and
updating the software to be used in the new CRD system.
(B) Self-Regulatory Organization's Statement on Burden on Competition
The NASD does not believe that the proposed rule change will result
in any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act, as amended.
(C) Self-Regulatory Organization's Statement on Comments on the
Proposed Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective on October 3, 1996,
pursuant to Section 19(b)(3)(A)(ii) of the Act and subparagraph (e) of
Rule 19b-4 thereunder in that it establishes or changes a due, fee or
other charge.
At any time within 60 days of the filing of a rule change pursuant
to Section 19(b)(3)(A) of the Act, the Commission may summarily
abrogate the 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.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing. Persons making written submissions
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549.
Copies of the submission, all subsequent amendments, all written
statement 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 to inspection and copying in the Commission's Public
Reference Room. Copies of such filing will also be available for
inspection and copying at the principal office of the NASD. All
submissions should refer to File No. SR-NASD-96-36 and should be
submitted by November 12, 1996.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority, 17 CFR 200.30-3(a)(12).
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-27035 Filed 10-21-96; 8:45 am]
BILLING CODE 8010-01-M
