[Federal Register Volume 61, Number 250 (Friday, December 27, 1996)]
[Notices]
[Pages 68324-68325]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-32954]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-38065; File No. SR-SCCP-96-08]
Self-Regulatory Organizations; Stock Clearing Corporation of
Philadelphia; Notice of Filing of a Proposed Rule Change to Amend the
Participants Fund Formula for Continuous Net Settlement Participants
December 19, 1996.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on August 21, 1996, the Stock
Clearing Corporation of Philadelphia (``SCCP'') filed with the
Securities and Exchange Commission (``Commission'') the proposed rule
change (File No. SR-SCCP-96-08) as described in Items, I, II, and III
below, which items have been prepared primarily by SCCP. On October 8,
and November 20, 1996, SCCP filed amendments to the proposed rule
change.\2\ The Commission is publishing this notice to solicit comments
on the proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ Letters from Linda S. Christie, Staff Counsel, SCCP, to
Jerry Carpenter, Assistant Director, Division of Market Regulation,
Commission (September 18, September 30, and November 18, 1996).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The purpose of the proposed rule change is to amend SCCP's
participants fund formula for its continuous net settlement (``CNS'')
participants.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, SCCP included statements
concerning the purpose of and basis for the proposed rule change 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. SCCP has prepared summaries, set forth in sections (A),
(B), and (C) below, of the most significant aspects of such
statements.\3\
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\3\ The Commission has modified the text of the summaries
submitted by SCCP.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
The purpose of the proposed rule change is to amend SCCP's
participants fund formula relating to its CNS participants. Currently,
the participants
[[Page 68325]]
fund contribution of each of SCCP's CNS participants is based upon the
larger of (1) $1,000 for every twenty-five trading units of one hundred
shares based on the participant's monthly average of trading activity
during the preceding three months or (2) the participant's aggregate
dollar amount of all long trades at their execution price for the prior
three months divided by the number of days in the prior three months
multiplied by two percent.\4\
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\4\ Securities Exchange Act Release Nos. 37623 (August 29,
1996), 61 FR 47229 [File No. SR-SCCP-96-07] (notice of filing and
order granting accelerated approval on a temporary basis of a
proposed rule change seeking permanent approval of the participants
fund formulas).
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SCCP proposes to amend its CNS participants fund formula to assess
each CNS participant (1) two percent (2%) of the value of its average
daily gross buy trades derived over a rolling three month period, plus
(2) one-half of one percent (.5%) of the gross value of its sell trades
to the extent that value exceeds the gross value of the buy trades
derived over the same rolling three month period. The terminology of
buys or sells for purposes of calculating participants fund
contributions refer to a participant's gross trades and not netted
positions.
CNS automatically nets each participants buy and sell trades to a
net long or a net short position thereby giving rise to only a net
exposure to any particular participant. SCCP's CNS participants fund
formula bases its calculation of fund contributions on the basis of
gross trade positions which should yield a greater amount upon which to
base participants' fund computations than an amount derived from net
trade positions. SCCP will recalculate each participant's deposit
requirement at the end of each month based upon the previous three
months prior to the most recent month.\5\ The required participants
fund contribution will be rounded up in $5,000 increments. SCCP also
proposes to create a $15,000 minimum contribution for CNS participants.
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\5\ For example, at the end of December, SCCP will use activity
from September, October, and November to calculate each
participant's deposit requirement.
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SCCP believes the proposed rule change is consistent with Section
17A of the Act and the rules and regulations thereunder because the
proposal should assure the safeguarding of securities and funds in its
custody or control or for which it is responsible.
(B) Self-Regulatory Organization's Statement on Burden on Competition
SCCP believes that the proposed rule change will not impose any
burden on competition not permitted by the Act.
(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 with respect
to the proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within thirty-five days of the date of publication of this notice
in the Federal Register or within such longer period (i) as the
Commission may designate up to ninety 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 SCCP consents, the Commission will:
(a) By order approve such proposed rule change or
(b) Institute proceedings to determine whether the proposed rule
change should be disapproved.
IV. Solicitation 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
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 Room, 450 Fifth Street, N.W., Washington,
D.C. 20549. Copies of such filing will also be available for inspection
and copying at the principal office of SCCP. All submissions should
refer to the file number SR-SCCP-96-08 and should be submitted by
January 17, 1997.
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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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-32954 Filed 12-26-96; 8:45 am]
BILLING CODE 8010-01-M
