Federal Register / Vol. 65, No. 88 / Friday, May 5, 2000 / Notices 26255

6 15 U.S.C. 78f(b).

7 15 U.S.C. 78f(b)(6).

8 15 U.S.C. 78s(b)(3)(A).

9 17 CFR 240.19b–4(f)(6).

10 In reviewing this rule, the Commission has

considered the proposed rule’s impact on

efficiency, competition, and capital formation. 15

U.S.C. 78c(f).

11 17 CFR 200.30–3(a)(12).

1 15 U.S.C. 78s(b)(1).

2Securities Exchange Act Release No. 42279,

(December 28, 1999), 65 FR 541.

3 In 1998, GSCC’s board of directors requested

that GSCC explore the possibility of providing in

Europe the types of comparison, netting, and risk

management services that GSCC provides in the

United States. GSCC originally planned to provide

these services through a joint venture with

Euroclear and its operator Morgan Guaranty Trust

Company of New York, Brussels Branch.

Specifically, GSCC and Euroclear had planned to

use J.P. Morgan Benelux, S.A., an existing Morgan

subsidiary, as the netting vehicle that would have

been renamed the European Securities Clearing

Corporation. In a separate development, LCH was

also asked by its members to provide these same

services in Europe. In response, in April 1999 LCH

began offering its RepoClear service through which

LCH provides netting services for European

sovereign debt repo transactions. To achieve greater

efficiency, GSCC, Euroclear, and LCH have agreed

that it would be more efficient to provide the

services for European sovereign debt purchases and

repo transactions through a single netting vehicle,

RepoClear.

4 In accordance with the agreement between

GSCC, Euroclear, and LCH, LCH will transfer

control of RepoClear to ESCC. For a description of

LCH’s RepoClear, see note 3.

appoint in each instance the specific

hearing officer that will chair each

Amex disciplinary panel. The Amex

Board has approved this amendment

and specifically authorized the Chief

Hearing Officer (or the Deputy Hearing

Officer) at the NASDR’s Office of

Hearing Officers, as the Amex

Chairman’s designee, to appoint NASDR

hearing officers to chair Amex

disciplinary panels. The Exchange is

amending Rule 2(a) for the sole purpose

of streamlining the process for selecting

hearing officers. The Exchange believes

the amendment will provide for more

efficient administration of Amex

disciplinary proceedings.

2. Statutory Basis

The Exchange believes that the

proposal is consistent with Section 6(b)

of the Act 6 in general and furthers the

objectives of Section 6(b)(6) 7 in

particular in that it is intended to assure

that Exchange members and member

firms are appropriately disciplined for

rule violations.

B. Self-Regulatory Organization’s

Statement on Burden on Competition

Amex believes the proposed rule

change will impose no burden on

competiton.

C. Self-Regulatory Organization’s

Statement on Comments on the

Proposed Rule Change Received From

Members, Participants or Others

No written comments were solicited

or received with respect to the proposed

rule change.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

Because the foregoing proposed rule

change does not:

(i) Significantly affect the protection

of investors or the public interest;

(ii) Impose any significant burden on

competition; and

(iii) Become operative for 30 days

from the date on which it was filed, or

such shorter time as the Commission

may designate, it has become effective

pursuant to section 19(b)(3)(A) of the

Act 8 and Rule 19b–4(f)(6) thereunder.9

At any time within 60 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.10

IV. Solicitation of Comments

Interested persons are invited to

submit written data, views, and

arguments concerning the foregoing,

including whether the proposal is

consistent with the Act. Persons making

written submissions should file six

copies thereof with the Secretary,

Securities and Exchange Commission,

450 Fifth Street NW, Washington, DC

20549–0609. 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. Copies of such filing will also be

available for inspection and copying at

the principal office of the Amex. All

submissions should refer to file number

SR–Amex–00–24 and should be

submitted by May 26, 2000.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.11

Jonathan G. Katz,

Secretary.

[FR Doc. 00–11227 Filed 5–4–00; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–42729; File No. SR–GSCC–

99–05]

Self-Regulatory Organizations;

Government Securities Clearing

Corporation; Order Granting Approval

of a Proposed Rule Change Relating to

the Formation of the European

Securities Clearing Corporation

April 28, 2000.

On November 16, 1999, the

Government Securities Clearing

Corporation (‘‘GSCC’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) a proposed rule change

(File No. SR–GSCC–99–05) pursuant to

section 19(b)(1) of the Securities

Exchange Act of 1934 (‘‘Act’’).1 Notice

of the proposal was published in the

Federal Register on January 5, 2000.2

No comment letters were received. For

the reasons discussed below, the

Commission is granting approval of the

proposed rule change.

I. Description

Under the rule change, GSCC seeks

Commission approval to become an

initial shareholder and to serve on the

board of directors of the European

Securities Clearing Corporation

(‘‘ESCC’’). ESCC will be a new entity

formed under the laws of the United

Kingdom by GSCC, the Euroclear

Clearance System Societe Cooperative

(‘‘Euroclear’’), and the London Clearing

House (‘‘LCH’’). ESCC will be owned

equally by GSCC, Euroclear, and LCH.3

ESCC’s main role will be to oversee

the scope and nature of the netting

services being offered through LCH’s

RepoClear.4 It is intended that ESCC

will be governed by its market

participant users, which are expected to

be major participants in the European

fixed-income marketplace. GSCC’s

involvement in ESCC will be a

governance role that should help

ensure, among other things, that

RepoClear will draw upon GSCC’s

experience and knowledge and will

have United States-style features such as

single-ticket data input, settlement of

contracts at current market value, the

facilitation of substitutions, and the

admission of inter-dealer brokers.

GSCC’s role in ESCC will further help

to ensure that the RepoClear service will

use, to the extent appropriate, GSCC’s

mark-to-market and margining

methodologies to provide

comprehensive, uniform risk

26256 Federal Register / Vol. 65, No. 88 / Friday, May 5, 2000 / Notices

5The proposed cross-margining arrangement will

be the subject of a separate rule filing by GSCC in

the future. GSCC, Euroclear, and LCH intend to

work toward implementing the cross-margining

arrangement by early 2001.

6 15 U.S.C. 78q–1(b)(3)(F).

7 17 CFR 200.30–3(a)(12).

1 15 U.S.C. 78s(b)(1).

2 17 CFR 240.19b–4.

3Securities Exchange Act Release No. 42473

(February 29, 2000), 65 FR 11818.

4 In approving this rule, the Commission has

considered its impact on efficiency, competition,

and capital formation. 15 U.S.C. 78c(f).

5 15 U.S.C. 78f.

6 15 U.S.C. 78f(b)(4).

7 Id.

8 15 U.S.C. 78s(b)(2).

9 17 CFR 200.30–3(a)(12).

1 15 U.S.C. 78s(b)(1).

2 17 CFR 240.19b–4.

management processes. GSCC intends to

help ensure that: (i) Processing

efficiencies will be attained through the

utilization of standardized SWIFT

message formats for input and output;

(ii) participants’ margin requirements

will be reduced through cross-margining

both their European Government

securities activity and their combined

United States and European activity; 5

(iii) participants’ balance sheets will be

reduced and they will experience

increased capital utilization through a

maximization of the offsets available

from repo and reverse repo activity; (iv)

the RepoClear service will support

global electronic trading systems which

will allow for more efficient settlement

of side-by-side cash and futures

activities through coordinated mark-tomarket and margining processes,

standardized clearance and settlement

practices, and optimized crossmargining of correlated positions.

II. Discussion

Section 17A(b)(3)(F) 6 of the Act

requires that the rules of a clearing

agency be designed to promote the

prompt and accurate clearance and

settlement of securities transactions and

to foster cooperation and coordination

with persons engaged in the clearance

and settlement of securities

transactions. For the reasons set forth

below, the Commission believes that

GSCC’s proposed rule change is

consistent with GSCC’s obligations

under the Act.

GSCC’s participation in ESCC as a

shareholder and a member of the board

of directors should help to ensure that

ESCC is able to provide both to United

States organizations operating abroad,

either directly or through their

European affiliates, and to non-United

States organizations a clearance and

settlement system that provides for the

prompt and accurate clearance and

settlement of buys and sells and repo

transactions involving European

sovereign debt instruments. GSCC’s

participation in ESCC should also foster

cooperation and coordination between

itself, Euroclear, and LCH, all of which

are major providers of clearance and

settlement services.

III. Conclusion

On the basis of the foregoing, the

Commission finds that the proposed

rule change is consistent with the

requirements of the Act and in

particular Section 17A of the Act and

the rules and regulations thereunder.

It Is Therefore Ordered, pursuant to

section 19(b)(2) of the Act, that the

proposed rule change (File No. SR–

GSCC–99–05) be and hereby is

approved.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.7

Jonathan G. Katz,

Secretary.

[FR Doc. 00–11254 Filed 5–4–00; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–42370; File No. SR–ISE–

00–02]

Self-Regulatory Organizations; Order

Granting Approval of Proposed Rule

Change by the International Securities

Exchange LLC Relating to Its Fee

Schedule

April 28, 2000.

I. Introduction

On February 25, 2000, the

International Securities Exchange LLC

(‘‘ISE’’ or ‘‘Exchange’’) filed with the

Securities and Exchange Commission

(‘‘SEC’’ or ‘‘Commission’’), pursuant to

section 19(b)(1) of the Securities

Exchange Act of 1934 (‘‘Act’’),1 and

Rule 19b–4 thereunder,2 a proposed rule

change to adopt a fee schedule.

The proposed rule change was

published for comment in the Federal

Register on March 6, 2000.3 No

comments were received on the

proposal. This order approves the

proposal.

II. Description of the Proposal

ISE’s proposed fee schedule itemizes

fees for the services it will offer to its

members and others. This schedule

includes membership fees, trading fees,

and fees for a variety of other services,

including the installation and

maintenance of certain equipment. ISE

stated in its proposal that it intends to

use revenues from these fees to recover

its costs of operating a trading market

and to build a reserve for future needs.

ISE further stated that it does not intend

to use these fees to generate an

operating profit to distribute to its

members, and will adjust its fees to

maintain the appropriate balance

between costs and expenses, as ISE

gains experience in the operation of its

market.

III. Discussion

The Commission finds that the

proposed rule change is consistent with

the requirements of the Act and rules

and regulations thereunder applicable to

a national securities exchange,4 and in

particular, with the requirements of

section 6 of the Act.5 Specifically, the

Commission finds that the proposal is

consistent with section 6(b)(4) of the

Act.6

Under section 6(b)(4),7 a registered

national securities exchange must

promulgate rules that provide for the

equitable allocation of reasonable dues,

fees and other charges among its

members and other persons using its

facilities. The Commission finds that

ISE’s fee schedule is not unreasonable

and should not discriminate unfairly

among market participants.

IV. Conclusion

It Is Therefore Ordered, pursuant to

section 19(b)(2) of the Act,8 that the

proposed rule change (SR–ISE–00–02) is

approved.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.9

Jonathan G. Katz,

Secretary.

[FR Doc. 00–11229 Filed 5–4–00; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–42734; File No. SR–NASD–

00–25]

Self-Regulatory Organizations; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change by National

Association of Securities Dealers, Inc.

Relating to Extension of Time To Pass

the Series 55 Examination, Equity

Trader

April 28, 2000.

Pursuant to section 19(b)(1) of the

Securities Exchange Act of 1934

(‘‘Act’’) 1 and Rule 19b–4 thereunder,2

notice is hereby given that on April 27,

2000, the National Association of