[Federal Register Volume 61, Number 35 (Wednesday, February 21, 1996)]
[Notices]
[Pages 6670-6672]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-3839]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-36844; File No. SR-DTC-96-04]
Self-Regulatory Organizations; The Depository Trust Company;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
Relating to the Revision of Certain Fees
February 14, 1996.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on January 25, 1996, the
Depository Trust Company (``DTC'') 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 DTC. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
\1\ 15 U.S.C. 78s(b)(1) (1988).
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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 revise the fees
charged for deliveries, money market instruments (``MMI'')
transactions, and long positions because of the conversion to same-day
funds settlement.\2\
\2\ A copy of the revised fee schedule is attached to this
notice of DTC's proposed rule change as Appendix A.
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II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, DTC 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. DTC has prepared summaries, set forth in sections (A),
(B), and (C) below, of the most significant aspects of such
statements.\3\
\3\ The Commission has modified the text of the summaries
prepared by DTC.
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(A) Self-Regulatory Organization's Statement of the Purpose of and
Statutory Basis for, the Proposed Rule Change
DTC plans to convert its existing next-day funds settlement and
same-day funds settlement (``SDFS'') systems into an entirely SDFS
system on February 22, 1996. Most of the fees currently charged for
services in each of the two settlement systems are identical and will
not at this time be affected by the conversion. The purpose of the
proposed rule change is to revise the
[[Page 6671]]
fees charged for deliveries, MMI transactions, and long positions which
will be affected by the conversion. These fees need to be changed in
order to establish a single fee for each of these services and to take
into account the substantially greater volumes of book-entry
transactions, numbers of issues to be included in the SDFS system, and
DTC's increased costs to process a book-entry delivery in the SDFS
systems.
The subject fee schedule revisions are revenue neutral to DTC
(i.e., the new fee should yield the same amount of revenue to DTC as
the old fees would have yielded when applied to anticipated 1996
volumes). The new fees represent a ``blending'' of the existing fees in
each settlement system reflecting last year's total costs for these
services. These historical costs may or may not represent the actual
processing costs in the new settlement system. DTC will need at least
several months after the conversion to evaluate the related unit
service costs for these three services.
DTC believes the proposed rule change is consistent with Section
17A of the Act \4\ and the rules and regulations thereunder because it
will provide for the equitable allocation of dues, fees, and other
charges among participants.
\4\ 15 U.S.C. 78q-1 (1988).
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(B) Self-Regulatory Organization's Statement on Burden on Competition
DTC does not believe that the proposed rule change will impose any
burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.
(C) Self-Regulatory Organization's Statement on Comments on the
Proposed Rule Change Received From Members, Participants or Others
The conversion was described in three memoranda issued jointly by
the National Securities Clearing Corporation and DTC \5\ and was
discussed in a DTC proposed rule change approved by the Commission on
May 16, 1995.\6\ DTC informed participants and other users of its
services of the proposed fee revisions by an Important Notice.\7\ No
written comments have been received. DTC will notify the Commission of
any written comments received by DTC.
\5\ The Depository Trust Company and National Securities
Clearing Corporation, Memorandum (July 1, 1992; July 26, 1993; and
July 29, 1994).
\6\ For additional information regarding DTC's SDFS system,
refer to Securities Exchange Act Release No. 35720 (May 16, 1995),
60 FR 27360 [File No. SR-DTC-95-06] (order granting accelerated
approval of a proposed rule change modifying the SDFS system).
\7\ DTC Important Notice (January 17, 1996).
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III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Sections
19(b)(3)(A)(ii) \8\ of the Act and pursuant to Rules 19b-4(e)(2) \9\
promulgated thereunder because the proposal establishes a due, fee, or
other charge. At any time within sixty days of the filing of such 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.
\8\ 15 U.S.C. 78s(b)(3)(A)(ii) (1988).
\9\ 17 CFR 240.19b-4(e)(2) (1995).
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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
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. Sec. 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 DTC. All
submissions should refer to File No. SR-DTC-96-04 and should be
submitted by March 13, 1996.
For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\10\
\10\ 17 CFR 200.30-3(a)(12) (1995).
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Margaret H. McFarland,
Deputy Secretary.
Appendix A--Fee Changes Arising From the Conversion to an All-SDFS
System
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Service Present fee Revised fee
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A. Registered Securities
I. NDFS Deliveries:
Deliver orders via CNS.. $.07 for each item $.08 for each item
delivered or delivered or
received. received.
Deliver orders via ID .17 for each item .20 for each item
System. delivered or delivered or
received. received.
Deliver orders via PTS,
MDH or CCF
For each deliver .15 to the deliverer .18 to the deliver.
item presented.
Prior PM............ .40 to the deliverer .47 to the
deliverer.
AM opening to cut- .25 for each item .29 for each item
off. received received
(regardless of (regardless of
time). time).
II. SDFS Deliveries/Money
Market Instruments
Activity:
SDFS Deliveries:
Deliver orders via PTS,
MDH or CCF
For each deliver .93 to the deliverer .18 to the
item presented. deliverer.
Prior PM............ 1.18 to the .47 to the
deliverer. deliverer.
AM opening to cut- 1.03 for each item .29 for each item
off. received received
(regardless of (regardless of
time). time).
Deliver orders via ID .93 for each item .20 for each item
system. delivered or delivered or
received. received.
Money Market Instruments
Activity
Deliver orders.......... 1.07 to the .59 to the
deliverer. deliverer.
.92 to the deliverer .41 to the receiver.
Maturity or .87 for each item .59 for each item
reorganization delivered or delivered or
presentments. received. received.
[[Page 6672]]
Issuance instruction 1.66 to the issuer's .59 to the issuer's
(both dealer-placed and agent. agent.
directly-placed).
B. Bearer Securities
I. Deliver Orders:
ID...................... .17 for each item .20 for each item
delivered or delivered or
received. received.
PTS, MDH or CCF......... .33 for each item .39 for each item
delivered. delivered.
.25 for each item .29 for each item
received. received.
II. Long Position:
For each active issue .58 per issue....... .59 per issue.
per month (held by more
than 2 Participants).
For each less-active 1.33 per issue...... 1.34 per issue.
issue per month (held
by 1 or 2 Participants).
Monthly charge on face
value
$0-$.5 billion...... .000006790.......... No Change.
Excess over .5 .0000016988......... No Change.
billion up to $1
billion.
Excess over $1 .00000084025........ No Change.
billion up to $8
billion.
Excess over $8 .00000042012........ No Change.
billion.
A monthly surcharge on 1.05 per issue...... No Change.
all positions in Book
Bond issues.
A monthly surcharge on .25 per issue....... No Change.
all positions requiring
coupon collection from
paying agents located
outside Metropolitan
New York area.
A monthly surcharge on .50 per issue....... No Change.
all positions in
multiple purpose issues.
A monthly surcharge on .50 per issue....... No Change.
all positions in issues
denominated in units of
$1,000.
III. Long Position:
For each active issue .47 per issue....... .50 per issue.
monthly (for registered
corporate issues when a
daily average of more
than 15 Participants
have positions; and for
registered municipal
issues when a daily
average of more than 2
Participants have
positions).
For each less-active .72 per issue....... .75 per issue.
registered corporate
issue monthly (when a
daily average of 15 or
fewer Participants have
position).
For each less-active 1.22 per issue...... 1.25 per issue.
registered municipal
issue monthly (when a
daily average of 1 or 2
Participants have
position).
For each 100 shares or
$4,000 bonds (monthly)
based on the average
daily number of shares
or bonds:
0-25 million shares. .0052............... No Change.
Excess over 25 .0013............... No Change.
million up to 200
million shares.
Excess over 200 .000652............. No Change.
million up to 300
million shares.
Excess over 300 .00005.............. No Change.
million shares.
For each book-entry-only .31 per issue, no No Change.
issue (monthly). per bond/per share
charge.
For each Medium-Term .56 per issue, no No Change.
Note (MTN) and Money per bond/per share
Market Instrument (MMI) charge.
issue (monthly).
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[FR Doc. 96-3839 Filed 2-20-96; 8:45 am]
BILLING CODE 8010-01-M
