[Federal Register Volume 59, Number 152 (Tuesday, August 9, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-19377]
[[Page Unknown]]
[Federal Register: August 9, 1994]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-34476; File No. SR-NSCC-94-14]
Self-Regulatory Organizations; National Securities Clearing
Corporation; Notice of Filing and Order Granting Accelerated Approval
on a Temporary Basis of a Proposed Rule Change Regarding an Expansion
of the Limited Money Settlement Service for a New York Window
Participant
August 1, 1994.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on August 1, 1994, the
National Securities Clearing Corporation (``NSCC'') filed with the
Securities and Exchange Commission (``Commission'') the proposed rule
change as described in Items I, and II, below, which Items have been
prepared primarily by NSCC. The Commission is publishing this notice
and order to solicit comment from interested persons and to grant
accelerated approval of the proposed rule change on a temporary basis
until January 31, 1995.
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\1\15 U.S.C. 78s(b)(i) (1988).
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I. Self-Regulatory Organization's Statement of the Terms of
Substance of the Proposed Rule Change
The proposed rule change will allow NSCC to offer the limited money
settlement service to an additional participant in the New York Window
pilot program.
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.
(A) Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change
NSCC currently operates a pilot program for the New York Window
service.\2\ In January 1994, the pilot program was expanded to include
a limited money settlement service for two New York Window
participants.\3\ The current proposed rule change will expand the pilot
program to provide limited money settlement services to an additional
New York Window participant.\4\
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\2\For a complete description of the New York Window program,
refer to Securities Exchange Act Release No. 32221 (April 26, 1993),
58 FR 26570 [File No. SR-NSCC-93-03] (order approving pilot program
on a temporary basis until April 30, 1994).
\3\For a complete description of limited money settlement
service, refer to Securities Exchange Act Release No. 33558 (January
31, 1994), 59 FR 5807 [File No. SR-NSCC-93-14] (order approving
pilot program on a temporary basis until January 31, 1995, and
expanding the pilot program to offer limited money settlement
services to two participants).
\4\This filing covers the period of the temporary approval.
Currently, NSCC is seeking permanent approval of the New York Window
services, which includes the money settlement service. Securities
Exchange Act Release No. 34470 (August 1, 1994) [File No. SR-NSCC-
94-12] (notice of filing seeking permanent approval of New York
Window service).
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NSCC has stated that the proposed rule change will be implemented
consistent with NSCC's statutory obligation under Section 17A of the
Act to safeguard securities and funds in NSCC's custody or control and
to promote the prompt and accurate clearance and settlement of
securities transactions.
(B) Self-Regulatory Organization's Statement on Burden on Competition
NSCC does not believe that the proposed rule will have an impact or
impose a burden on competition.
(C) Self-Regulatory Organization's Statement on Comments on the
Proposed Rule Change Received From Members, Participants, or Others
NSCC has not solicited or received any comments. 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
Section 17(A)(a)(1)(B) of the Act sets forth Congress findings that
inefficient procedures for clearance and settlement of securities
transactions impose unnecessary costs on investors and persons
facilitating transactions by and acting on behalf of investors.\5\ The
Commission reasserts its belief, as stated in the previous New York
Window approval orders, that NSCC's pilot program should help minimize
inefficient procedures employed by individual New York City
participants by concentrating these operations in one centralized
facility.\6\ The Commission believes that expanding the limited money
settlement service to include an additional New York Window participant
should provide a more efficient mechanism by which the participant can
settle its debits and credits generated by the New York Window
processing. Furthermore, it will give NSCC an expanded field in its
study of its limited money settlement service during the pilot program.
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\5\15 U.S.C. 78q-1(a)(1)(B).
\6\Supra notes 2 and 3.
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Section 17A(b)(3)(F) of the Act requires that the rules of a
clearing agency be designed to assure the safeguarding of securities
and funds which are in its custody or control or for which it is
responsible.\7\ The Commission believes that the safety procedures
established for the limited money settlement service and approved in
the previous New York Window approval order\8\ will continue to enable
NSCC to meet its obligations under Section 17A of the Act with an
additional participant using the limited money settlement service. For
example, NSCC will continue to not make any payment on behalf of or to
the limited money settlement services participants until NSCC has
received funds sufficient to cover the amount of NSCC's payment.
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\7\15 U.S.C. 79Q-1 (b) (3) (F).
\8\Supra Note 3.
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NSCC has requested that the Commission find good cause for
approving the proposed rule change 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 change because the Commission
has previously published notice of and has approved the limited money
settlement service. NSCC's previous proposed rule change did not
generate any comment letters, and none are expected on this proposal.
In addition, accelerated approval will allow the additional participant
to begin utilizing the limited money settlement service immediately and
to begin benefiting from the efficient and centralized payment
procedures provided by NSCC. During the temporary approval period, NSCC
will continue to evaluate the limited money settlement service.
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 NW., Washington, DC 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, NW.,
Washington, DC 20549 and the principal offices of NSCC. All submissions
should refer to File No. SR-NSCC-94-14 and should be submitted by
August 30, 1994.
V. Conclusion
It is therefore ordered, pursuant to section 19(b)(2) of the
Act,\9\ that the proposed rule change (File No. SR-NSCC-94-14) be, and
hereby is, approved until January 31, 1995.
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\9\15 U.S.C. 78s(b)(2) (1988).
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) (1993).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-19377 Filed 8-8-94; 8:45 am]
BILLING CODE 8010-01-M
