31952 Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Notices

13 15 U.S.C. 78k–1.

14 17 CFR 240.11Aa3–2.

15 17 CFR 200.30–3(a)(29).

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

2Securities Exchange Act Release No. 42482,

(March 1, 2000), 65 FR 12602.

3With respect to global share issues of issuers

such as UBS, DTC expects to hold the bulk of its

positions at DTC so that DTC’s position will be

reflected on the books of U.S. transfer agents.

4 15 U.S.C. 78q–1(b)(3)(F). 5 17 CFR 200.30–3(a)(12).

traffic. The Commission believes that

approving the proposed capacity

allocation will provide the options

exchanges and OPRA with an

immediate, short-term solution to a

pressing problem, while giving the

Commission and the options markets

additional time to evaluate, and

possibly implement, other quote

mitigation strategies. In addition, the

limited time frame of this capacity

allocation program provides the

Commission and the options exchanges

with greater flexibility to modify the

program, as necessary, to ensure the

fairness of the allocation process to all

of the options markets going forward.

The Commission finds, therefore, that

granting accelerated approval of the

proposed OPRA Plan amendment, as

modified, is appropriate and consistent

with Section 11A of the Act.13

V. Conclusion

It is therefore ordered, pursuant to

Rule 11Aa3–2 of the Act,14 that the

proposed OPRA Plan amendment, as

modified, (SR–OPRA–00–04) is

approved on an accelerated basis until

September 9, 2000.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.15

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 00–12601 Filed 5–18–00; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–42782; File No. SR–DTC–

00–03]

Self-Regulatory Organizations; The

Depository Trust Company; Order

Granting Approval of a Proposed Rule

Change Relating to Establishing a

Depository Link With SIS

SegaInterSettle AG

May 15, 2000.

On February 22, 2000, The Depository

Trust Company (‘‘DTC’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) a proposed rule change

(File No. SR–DTC–00–03) 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 March 9, 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, DTC will

establish a free-of-payment omnibus

account at SIS SegaInterSettle AG

(‘‘SIS’’) in order to create a one-way

DTC–SIS link. The link will permit, but

will not require, DTC to hold in its

account at SIS positions in issues that

are eligible at both DTC and SIS. The

interface will enable DTC participants to

more efficiently move and position their

inventory through book-entry

movements from one depository’s books

to the other’s.3

Establishment of the link will enable

a DTC participant to settle a crossborder transaction with an SIS

counterparty by making a free-ofpayment book-entry delivery from

DTC’s omnibus account at SIS to the SIS

participant’s account at SIS. Conversely,

an SIS participant will be able to settle

a cross-border transaction with a DTC

participant by making a free-of-payment

book-entry delivery from the SIS

participant’s account at SIS to the DTC

omnibus account at SIS (while

identifying the DTC participant to

which the delivered securities should be

credited). The receiving DTC participant

then will be able to redeliver the

securities on either a free-of-payment or

versus-payment basis to any other DTC

participant within DTC.

SIS will make SIS’s custody and

depository services (such as income

collection, maturity presentments, and

reorganization processing) available to

DTC for securities held in DTC’s

account at SIS in accordance with SIS

procedures. Whether DTC holds its

underlying inventory in Switzerland or

in the U.S., DTC services to DTC

participants will be the same as are

currently provided.

II. Discussion

Section 17A(b)(3)(F) 4 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 assure the safeguarding of securities

and funds that are in its custody or

control or for which it is responsible.

For the reasons set forth below, the

Commission believes that DTC’s

proposed rule change is consistent with

DTC’s obligations under the Act.

The Commission believes that the link

between DTC and SIS should promote

the prompt and accurate clearance and

settlement of securities transactions.

The central purpose of the link is to

facilitate the efficient processing of

cross-border securities transactions

between DTC participants and SIS

participants. By opening an omnibus

account at SIS, DTC will enable its

participants to substitute efficient bookentry movements for inefficient physical

movements of securities certificates

from SIS to DTC. The link should

reduce much of the time, expense, costs,

and risks associated with physically

moving certificates from SIS and

redepositing them at DTC.

The Commission also believes that

DTC has established the link with SIS

in a manner that is consistent with its

safeguarding obligations under the Act.

In order to assure itself that the linking

with SIS is safe and prudent, DTC

completed an extensive review of such

things as: (1) SIS’s operational controls,

financial strength, technology

capabilities, and audit arrangements; (2)

Swiss regulation of SIS; and (3)

application and effect of Swiss and U.S.

laws as they pertain to the link.

Accordingly, the Commission finds

that the link satisfies DTC’s obligations

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.

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–

DTC–00–03) be and hereby is approved.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.5

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 00–12628 Filed 5–18–00; 8:45 am]

BILLING CODE 8010–01–M