[Federal Register Volume 60, Number 142 (Tuesday, July 25, 1995)]
[Notices]
[Pages 38068-38069]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-18216]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-35984; File No. SR-MSTC-95-07]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by Midwest Securities Trust
Company Relating to Access to the Legal Expert System
July 18, 1995.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on May 8, 1995, the Midwest
Securities Trust Company (``MSTC'') 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 MSTC. 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 Organizations Statement of the Terms of Substance of
the Proposed Rule Change
MSTC proposes to make its inquiry-only Legal Expert System \2\
available to transfer agents that are not participants of MSTC pursuant
to individually negotiated contracts with MSTC.
\2\ For a complete description of the Legal Expert System, refer
to Securities Exchange Act Release Nos. 33756 (March 11, 1994), 59
FR 13350 [File No. SR-MSTC-94-02] (order approving a rule change
regarding the Legal Expert System's fees and a clarification
disclaiming any liability on MSTC's part for any misinformation
contained in the Legal Expert System); 35098 (December 13, 1994), 59
FR 65551 [SR-MSTC-94-17] (order modifying the pricing structure of
the Legal Expert System); and 35447 (March 6, 1995) 60 FR 15177 [SR-
MSTC-95-03] (order waiving the fees associated with the Legal Expert
System until March 1, 1995).
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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, MSTC 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. MSTC has prepared summaries, set forth in sections (A),
(B), and (C) below, of the most significant aspects of such
statements.\3\
\3\ The Commission had modified the text of the summaries
prepared by MSTC.
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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 provide transfer
agents that are not MSTC participants with access to MSTC's inquiry-
only Legal Expert System (``LES''). LES is a menu-driven computer
program that allows a user to inquire about the documentation necessary
for effecting a legal transfer of securities. The information found in
LES is based on standard industry criteria as well as on individual
state regulations for effecting legal transfers.
LES provides the user with a main registration menu and a submenu
for specific transfer situations. The self-help narratives guide the
user through the system by providing information and examples for each
certificate registration classification. The user is prompted to answer
basic questions about the certificate registration and transfer
situation to determine the legal delivery requirements and
documentation needed for the specific state involved.
LES will be available to nonparticipant transfer agents pursuant to
individually negotiated contracts between MSTC and individual transfer
agents. Among other things, the contracts will contain provisions that
at a minimum waive MSTC's liability to the same extent as provided in
MSTC's rules. The contracts also will require that transfer agents post
a deposit with MSTC to protect MSTC against any unpaid fees. The fees
that MSTC will charge the transfer agents (i.e., the
[[Page 38069]]
terminal inquiry fee, leased line fee, and communications fee) will be
identical to the fees charged participants.
MSTC believes that the proposed rule change is consistent with
Section 17A of the Act because it will facilitate the prompt and
accurate clearance and settlement of securities transactions.
(B) Self-Regulatory Organization's Statement on Burden on Competition
MSTC believes that no burden will be placed on competition as a
result of the proposed rule change.
(C) Self-Regulatory Organization's Statement on Comments on the
Proposed Rule Change Received From Members, Participants or Others
MSTC neither solicited nor received written comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing
for Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(iii) \4\ of the Act and Rule 19b-4(e)(4) \5\ thereunder
because it effects a change in an existing service that does not
adversely affect the safeguarding of securities or funds in the custody
or control of MSTC or for which MSTC is responsible and does not
significantly affect the respective rights or obligations of MSTC or
persons using the service. At any time within sixty days of the filing
of this rule change, the Commission may summarily abrogate this 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.
\4\ 15 U.S.C. 78s(b)(3)(A)(iii) (1988).
\5\ 17 CFR 240.19b-4(e)(4) (1994).
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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 at
the Commission's Public Reference Section, 450 Fifth Street, N.W.,
Washington, DC 20549. Copies of such filings also will be available for
inspection and copying at the principal office of MSTC. All submissions
should refer to File No. SR-MSTC-95-07 and should be submitted by
August 15, 1995.
For the Commission by the Division of Market Regulation,
pursuant to delegated authority. \6\
\6\ 17 CFR 200.30-3(a)(12) (1994).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 95-18216 Filed 7-24-95; 8:45 am]
BILLING CODE 8010-01-M
