[Federal Register Volume 59, Number 208 (Friday, October 28, 1994)]
[Unknown Section]
[Page ]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-26766]
[Federal Register: October 28, 1994]
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POSTAL RATE COMMISSION
[Release No. 34-34875; File Nos. SR-MCC-94-13 and SCCP-94-06]
Self-Regulatory Organizations; Midwest Clearing Corporation and
Stock Clearing Corporation of Philadelphia; Notice of Filing and Order
Granting Accelerated Approval of Proposed Rule Changes Expanding the
Interfaces With the National Securities Clearing Corporation's Fixed
Income Transaction System
October 21, 1994.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on October 13, 1994, and
October 21, 1994, respectively, the Midwest Clearing Corporation
(``MCC'') and the Stock Clearing Corporation of Philadelphia (``SCCP'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule changes as described in Items I and II below, which Items
have been prepared primarily by MCC and SCCP. On October 20, 1994, MCC
amended its filing to exclude the proposed addition of an automated
fixed income transaction system book entry feature for municipal
bonds.\2\ The Commission is publishing this notice and order to solicit
comments from interested persons and to grant accelerated approval of
the proposed rule changes.
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\1\15 U.S.C. 78s(b)(1) (1988).
\2\Letter from David T. Russoff, Attorney, MCC, to Peter
Geraghty, Attorney, Division of Market Regulation, Securities and
Exchange Commission (October 20, 1994). The book entry feature is
the subject of Midwest Securities Trust Company File No. SR-MSTC-94-
14.
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I. Self-Regulatory Organizations' Statement of the Terms of
Substance of the Proposed Rule Changes
MCC and SCCP each propose to expand its interface with the National
Securities Clearing Corporation's (``NSCC'') fixed income transaction
system (``FITS'')\3\ to include corporate bonds and unit investment
trusts (``UITs'').\4\
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\3\For a detailed description of NSCC's FITs, see Securities
Exchange Act Release No. 32747 (August 13, 1993), 58 FR 44530 [File
No. SR-NSCC-93-02] (order approving proposed rule change).
\4\For a complete description of NSCC's expansion of FITS to
include corporate bonds and unit investment trusts, refer to
Securities Exchange Act Release No. 34867, (October 20, 1994) [File
No. SR-NSCC-94-16] (order approving proposed rule change).
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II. Self-Regulatory Organizations' Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Changes
In their filings with the Commission, MCC and SCCP included
statements concerning the purpose of and basis for the proposed rule
changes and discussed any comments they received on the proposed rule
changes. The text of these statements may be examined at the places
specified in Item IV below. MCC and SCCP have prepared summaries, set
forth in section (A), (B), and (C) below, of the most significant
aspects of such statements.
(A) Self-Regulatory Organizations' Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Changes
Under the proposed rule filings, MCC and SCCP each propose to
expand its interface with NSCC's FITS to enable MCC and SCCP
participants to take advantage of the improved input and comparison
features of FITS for corporate bonds and UITs.\5\
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\5\Supra note 4.
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Similar to MCC's and SCCP's current interfaces with NSCC's FITS for
municipal securities,\6\ all trade comparisons for corporate bonds and
UITs will be conducted at NSCC and not at either MCC or SCCP. Under the
expanded interfaces, the earlier cutoff times for the input by MCC and
SCCP participants of two-side original trade information that were
previously applicable for municipal securities trades now will be
applicable to trades in corporate bonds and unit investment trusts.
MCC's cutoff time for submission by its participants of original trade
input will be 7:00 P.M. (central time) on the trade date and 4:00 P.M.
(central time) on the day following the trade date (``T+1'') for
supplemental trade input. SCCP's cutoff time for submission by its
participants of original trade input will be 1:00 A.M. (eastern time)
on trade date, and adjustments to original trade input must be made
prior to 4:00 P.M. (eastern time) on T+1.\7\ Because NSCC will be
transmitting comparison reports to MCC and SCCP reflecting the compared
trades of MCC and SCCP participants early in the morning on T+1, MCC
and SCCP will produce contract reports for their participants by 8:00
A.M. (central time) and 9:00 A.M. (eastern time), respectively, on T+1.
The interface will enable MCC and SCCP participants to take full
advantage of the NSCC expansion of FITS.
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\6\For a complete description of the original MCC and SCCP
interface with NSCC's FITS, see Securities Exchange Act Release No.
33524 (January 26, 1994), 59 FR 4958 [File Nos. SR-MCC-93-04 and
SCCP-93-03] (order approving establishment of interfaces with NSCC's
FITS).
\7\The SCCP cutoff times referred to above are for automated
input. SCCP's cutoff time for manual submission of original trade
input will be 4:00 P.M. (eastern time) on trade date. Manual input
adjustments to original trade input must be made prior to 1:00 P.M.
(eastern time) on T+1.
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(B) Self-Regulatory Organizations' Statement on Burden on Competition
MCC and SCCP do not believe that the proposed rule changes will
impose a burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.
(C) Self-Regulatory Organizations' Statement on Comments on the
Proposed Rule Changes Received from Members, Participants or Others
Comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Changes and Timing
for Commission Action
Section 17A(a)(2)(A)(i) of the Act directs the Commission to
facilitate the establishment of a national system for the prompt and
accurate clearance and settlement of securities transactions.\8\
Because the expanded interfaces enable MCC and SCCP participants to
utilize FITS with all its benefits, the Commission believes, for all
the reasons set forth in the FITS approval order,\9\ that the proposed
rule changes filed by MCC and SCCP further this goal.
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\8\15 U.S.C. Sec. 78q-1(a)(2)(A)(i) (1988).
\9\Supra note 4.
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MCC and SCCP have requested that the Commission find good cause for
approving the proposed rule changes prior to the thirtieth day after
the date of publication of notice of the filing. The Commission finds
good cause for so approving the proposed rule changes because
accelerated approval will allow MCC participants and SCCP participants
to utilize and to take full advantage of the benefits of the expanded
FITS as soon as it is operational at NSCC. Furthermore, the Commission
has previously published notice of and approved NSCC's implementation
of the enhanced FITS. NSCC's proposed rule change did not generate any
comment letters, and none are expected on MCC's and SCCP's proposals.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing. Persons making written submission
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street NW., Washington DC 20549. Copies
of the submissions, all subsequent amendments, all written statements
with respect to the proposed rule changes that are filed with the
Commission, and all written communications relating to the proposed
rule changes 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 at the
Commission's Public Reference Section, 450 5th Street NW., Washington,
DC 20549. Copies of such filings will also be available at the
principal offices of MCC and SCCP. All submissions should refer to File
Nos. SR-MCC-94-13 and SR-SCCP-94-06 and should be submitted by November
18, 1994.
On the basis of the foregoing, the Commission finds that the
proposal is consistent with the requirements of the Act, particularly
with Section 17A(a)(2)(A)(i) of the Act, and the rules and regulations
thereunder.
It Is Therefore Ordered, pursuant to Section 19(b)(2) of the Act,
that the proposed rule changes (File Nos. SR-MCC-94-13 and SR-SCCP-94-
06) be, and hereby are, approved.
For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\10\
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\10\17 CFR 200.30-3(a)(12) (1994).
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[FR Doc. 94-26766 Filed 10-27-94; 8:45 am]
BILLING CODE 8010-01-M
