[Federal Register Volume 63, Number 34 (Friday, February 20, 1998)]
[Notices]
[Pages 8729-8730]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-4253]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-39656; File No. SR-NSCC-97-18]
Self-Regulatory Organizations; National Securities Clearing
Corporation; Notice of Filing and Immediate Effectiveness of a Proposed
Rule Change Modifying the Interpretation of the Release of Clearing
Data
February 12, 1998.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on December 23, 1997, 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. 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).
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I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change
The proposed rule change modifies NSCC's interpretation concerning
the release of clearing data to regulatory and self-regulatory
organizations to permit NSCC to pass through customer municipal
securities transaction data required by the Municipal Securities
Rulemaking Board (``MSRB'').
II. Self-Regulatory 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 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.\2\
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\2\ The Commission has modified parts of these statements.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
The MSRB's rules require brokers, dealers, and municipal securities
dealers (collectively, ``dealers'') to report interdealer municipal
securities transaction data to the MSRB. In connection with this
requirement, NSCC currently provides the MSRB with interdealer
municipal securities transaction data based on trades submitted to NSCC
by dealers for automated comparison. The MSRB uses the data to maintain
a surveillance database and to make public reports on price and volume
of frequently traded issues.
The MSRB has amended its rules to require dealers also to report
customer (i.e., institutional and retail) municipal securities
transaction data to the MSRB for transactions effected after January 1,
1998. In connection with this requirement, the MSRB has asked NSCC to
act as a conduit to enable dealers that are NSCC participants to use
existing telecommunications links between NSCC and the MSRB to pass
through the required customer municipal securities transaction data.
NSCC's interpretation concerning the release of clearing data to
regulatory and self-regulatory organizations is set forth in Addendum H
to NSCC's rules and procedures. Addendum H limits the release of
municipal securities clearing data to regulatory and self-regulatory
organizations that have demonstrated the necessity for obtaining the
data in furtherance of their regulatory purpose.
The proposed rule change modifies Addendum H to permit NSCC to
facilitate the provision of interdealer and customer municipal
securities transaction data to the MSRB.\3\ NSCC believes that the
provision of this data is consistent with NSCC's interpretation as it
serves the MSRB's regulatory purposes, namely to provide transparency
in the municipal securities market and to assist compliance by
participants with the MSRB's rules.
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\3\ NSCC does not intend to edit, to validate, or otherwise to
alter the information to be received from dealers and transmitted to
the MSRB.
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NSCC believes the proposed rule change is consistent with Section
17A(b)(3)(F) \4\ of the Act because provision of interdealer and
customer municipal securities transaction data to the MSRB will help
foster cooperation and coordination with persons engaged in the
clearance and settlement of security transactions and in general will
help protect investors and the public interest.
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\4\ 15 U.S.C. 78q-1(b)(3)(F).
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(B) Self-Regulatory Organization's Statement on Burden on Competition
NSCC does not believe that the proposed rule change will impact or
impose a burden on competition.
[[Page 8730]]
(C) Self-Regulatory Organization's Statement on Comments on the
Proposed Rule Change Received from Members, Participants, or Others
No written comments have been solicited or received. NSCC will
notify the Commission of any written comments received by NSCC.
III. Date of Effectiveness of the Proposed Rule Change and Timing
for Commission Action
Because the foregoing rule change constitutes an interpretation
with respect to the meaning, administration, or enforcement of an
existing rule of NSCC, it has become effective pursuant to Section
19(b)(3)(A)(i) of the Act \5\ and Rule 19b-4(e)(1) thereunder.\6\ At
any time within sixty 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.
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\5\ 15 U.S.C. 78s(b)(3)(A)(i).
\6\ 17 CFR 240.19b-4(e)(1).
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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.
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, 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 the NSCC. All
submissions should refer to the File No. SR-NSCC-97-18 and should be
submitted by March 13, 1998.
For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\7\
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\7\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-4253 Filed 2-19-98; 8:45 am]
BILLING CODE 8010-01-M
