[Federal Register Volume 64, Number 204 (Friday, October 22, 1999)]
[Notices]
[Pages 57169-57170]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-27605]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-42016; File No. SR-EMCC-99-10]
Self-Regulatory Organizations; Emerging Markets Clearing
Corporation; Notice of Filing of Proposed Rule Change Relating to the
Requirements for a Class I, II, or III Director
October 15, 1999.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on September 24, 1999, the
Emerging Markets Clearing Corporation (``EMCC'') 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 EMCC. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
parties.
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\1\ 15 U.S.C.. 78s(b)(1).
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I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change
The proposed rule change will delay the implementation of certain
requirements for Class I, II, and III directors.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, EMCC 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 in
Item IV below. EMCC has prepared summaries, set forth in sections (A),
(B), and (C) below, of the most significant aspects of these
statements.\2\
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\2\ The Commission has modified the text of the summaries
prepared by EMCC.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
EMCC's by-laws currently provide that from and after the 1999
annual meeting of shareholders, individuals elected to Class I, II, or
III directorships must be an officer or partner of a shareholder or of
an affiliate or subsidiary of a shareholder.\3\ Similarly, EMCC's
amended and restated shareholder agreement provides that from and after
the 1999 annual meeting, directors elected to these classes must be an
officer or partner of a ``participant shareholder'' (i.e., a
shareholder that is also an EMCC participant) or of an affiliate of a
participant shareholder.\4\
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\3\ Article II, Section 2.2 of the by-laws.
\4\ Section 1(A) of the amended and restated shareholder
agreement.
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The purpose of the proposed rule change is to amend the by-laws and
the amended and restated shareholder agreement to postpone the
effectiveness of these requirements until the 2000 annual meeting of
shareholders. According to EMCC, its membership is not yet as large as
its management had anticipated, and there are a number of shareholders
and other industry participants who have not yet completed either
applying for membership or acquiring EMCC shares. EMCC believes it is
important to continue its developmental momentum and at the same time
to maintain the continuing broad-based representation of industry
participants on the EMCC Board.
In addition, when EMCC was originally organized, it was expected
that an entity that became a shareholder would also be the participant.
As EMCC's business has developed while the financial services industry
continues to consolidate, participants have indicated that they may
prefer that the shareholder and the participant be
[[Page 57170]]
affiliated but different entities. This flexibility would not adversely
impact EMCC's operations, and it should not impact the participant's
ability to be represented on the EMCC Board. Thus, the proposed rule
change will amend the definition of participant shareholder to mean a
shareholder that holds one or more Class A subject shares and is also a
participant or an affiliate of a participant.
EMCC believes that the proposed rule change is consistent with the
requirements of Section 17A of the Act \5\ and the rules and
regulations thereunder applicable to EMCC because it permits EMCC's
Board of Directors to continue to maintain broad representation of both
EMCC's participants and the emerging market debt industry and thus
allows EMCC to assure fair representation of its shareholders and
participants.
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\5\ 15 U.S.C. 78q-1.
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(B) Self-Regulatory Organization's Statement of Burden on Competition
EMCC does not believe that the proposed rule change will have any
impact or impose any burden on competition.
(C) Self-Regulatory Organization's Statement on Comments on the
Proposed Rule Change Received from Members, Participants or Others
Written comments relating to the proposed rule change have not yet
been solicited or received. EMCC will notify the Commission of any
written comments it receives.
III. Date of Effectiveness of the Proposed Rule Change and Timing
for Commission Action
Within 35 days of the publication of this notice in the Federal
Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) by order approve such rule change or
(B) institute proceedings to determine whether the proposed rule
change should be disapproved.
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. 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-
0609. 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 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, 450 Fifth Street, N.W.,
Washington, D.C. 20549. Copies of such filing also will be available
for inspection and copying at the principal office of EMCC. All
submissions should refer to File No. SR-EMCC-99-10 and should be
submitted by November 12, 1999.
For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\6\
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\6\ 17 CFR 200.30-3(a)(12).
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Jonathan G. Katz,
Secretary.
[FR Doc. 99-27605 Filed 10-21-99; 8:45 am]
BILLING CODE 8010-01-M
