[Federal Register Volume 65, Number 14 (Friday, January 21, 2000)]
[Notices]
[Pages 3515-3516]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-1465]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-42337; File No. SR-OCC-99-10]


Self-Regulatory Organizations; Options Clearing Corporation; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
Relating to Fees and Changes

January 12, 2000.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on September 30, 1999, The 
Options Clearing Corporation (``OCC'') filed with the Securities and 
Exchange Commission (``Commission'') the

[[Page 3516]]

proposed rule change as described in Items I, II and III below, which 
items have been prepared primarily by OCC. The Commission is publishing 
this notice to solicit comments on the proposed rule change from 
interested parties.
---------------------------------------------------------------------------

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

I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    Under the proposed rule change, OCC will reduce the clearing fees 
it charges to clearing members.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, OCC 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. OCC has prepared summaries, set forth in sections (A), 
(B), and (C) below, of the most significant aspects of these 
statements.\2\
---------------------------------------------------------------------------

    \2\ The Commission has modified the text of the summaries 
prepared by OCC.
---------------------------------------------------------------------------

(A) Self-Regulatory Organization's Statement of the Propose of, and 
Statutory Basis for, the Proposed Rule Change

    Under the proposed rule change, OCC reduced the levels of clearing 
fees that it charges for established products for the last quarter of 
1999. During the first three quarters of 1999, OCC experienced a record 
volume of options cleared. As a result, OCC proposes to reduce its 
levels of clearing fees beginning on October 1, 1999, as follows:

----------------------------------------------------------------------------------------------------------------
                                                        Current discounted clearing
                 Contract trade level                    fee (as of July 1, 1999)       Proposed clearing fee
----------------------------------------------------------------------------------------------------------------
1-500................................................  $0.075......................  $0.065.
501-1000.............................................  0.06........................  0.055.
1001-2000............................................  0.0525......................  0.045.
>2000................................................  100.00 flat fee.............  80.00 flat fee.
----------------------------------------------------------------------------------------------------------------

    OCC believes that the foregoing fee change will assure each 
clearing member a discount on clearing fees. The proposed discounted 
fee schedule change will ensure that clearing members can immediately 
realize the benefits of reduced fees (rather than waiting for OCC's 
rebate of clearing fees) without adversely affecting OCC's ability to 
maintain an acceptable level of retained earnings. Commencing the first 
trading day of 2000, these clearing fees will revert to the 1999 levels 
in effect before July 1, 1999. \3\
---------------------------------------------------------------------------

    \3\ Refer to Securities Exchange Act Release No. 41736 (August 
19, 1999), 64 FR 45295 [File No. SR-OCC-99-8] for fees in effect 
before July 1, 1999.
---------------------------------------------------------------------------

    OCC believes that the proposed rule change is consistent with the 
requirements of Section 17A(b0(30(D) of the Act \4\ and the rules and 
regulations thereunder applicable to OCC, because it provides for the 
equitable allocation of reasonable dues, fees, and other charges among 
OCC's participants.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78q 1.
---------------------------------------------------------------------------

(B) Self-Regulatory Organization's Statement on Burden on Competition

    OCC does not believe that the proposed rule change will have any 
impact or impose any burden on competition.

(C) Self-Regulatory Organization's Statement on Comments on the 
Proposed Rule Change Received From Members, Participants or Others

    Written comments relating to the proposed rule change have not yet 
been solicited or received. OCC will notify the Commission of any 
written comments recieved by OCC.

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)(ii) \5\ of the Act and Rule 19b 4(f)(2) \6\ promulgated 
thereunder because the proposal establishes or changes a due, fee, or 
other charge imposed by OCC. At any time within sixty days of the 
filing of such 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.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \6\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. 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-
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 Section, 450 Fifth Street, N.W., 
Washington, D.C. 20549. Copies of such filing also will be available 
for inspection and copying at the principal office of OCC. All 
submissions should refer to File No. SR-OCC-99-10 and should be 
submitted by February 11, 2000.
    For the Commission by the Division of Market Regulation, pursuant 
to delegated authority.\7\
---------------------------------------------------------------------------

    \7\ 17 CFR 200.30-3(a)(12).

Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 00-1465 Filed 1-20-00; 8:45 am]
BILLING CODE 8010-01-M