[Federal Register Volume 62, Number 203 (Tuesday, October 21, 1997)]
[Notices]
[Pages 54669-54670]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-27760]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-39231; File No. SR-OCC-97-16]


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

October 10, 1997.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on September 2, 1997, The 
Options Clearing Corporation (``OCC'') 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 OCC. The Commission is publishing this notice to solicit 
comments from interested persons on the proposed rule change.
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    \1\ 15 U.S.C. 78S(b)(1).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The proposed rule change revises OCC's fees for its clearing 
service and introduces an interim and regular fee for the Dow Jones 
Industrial Average (``DJIA'') index option contract service.

4II. 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 such 
statements.\2\
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    \2\ The Commission has modified the text of the summaries 
prepared by OCC.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    During the first half of 1997, OCC experienced a record volume of 
options cleared. OCC currently refunds a portion of clearing fees 
collected during the year to its clearing members when it experiences 
high volume levels. The practice of refunding clearing fees at the end 
of OCC's fiscal year creates a gap between when it realizes record 
clearing fees and when the clearing member realizes its year-end 
discount.
    The purpose of the proposed rule change is to revise OCC's per 
contract clearing fee from $.10 to $.068 for the remainder of 1997 for 
all contracts cleared between September 1, 1997, through December 31, 
1997. In addition, OCC will not bill clearing members for data services 
fees and exercise fees from July 1, 1997, through December 31, 1997.\3\ 
OCC believes a reduction in fees allows members to realize an immediate 
reduction in costs rather than having to wait for OCC to disburse 
refunds at the end of the fiscal year.
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    \3\ Such fees consist of a $1.00 exercise fee, $269.00 per month 
for leased line direct data service, $355.00 per month for dial up 
data service, and $250.00 per month for service bureau data service.
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    The purpose of the rule change is also to introduce an interim 
discounted and regular fees for the DJIA index option contract which is 
scheduled to begin trading in October 1997. OCC believes that the DJIA 
fee structure will encourage trading and clearance of this new 
contract. OCC is offering an introductory clearing fee of $.00 per 
contract per side for the first month the DJIA is traded, $.025 per 
contract per side for the second month, $.05 per contract per side for 
the third month, and $.10 per contract per side (i.e., the normal OCC 
rate) thereafter.\4\
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    \4\ OCC is considering applying the proposed introductory fee 
structure for the DJIA to all new contracts introduced in the 
future.
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    OCC has received approval to store media on CD-ROM to replace the 
practice of storage on microfiche.\5\ While OCC no longer stores new 
media or data on microfiche, there remains historic data stored on 
microfiche. Because both the need for retrieval of data stored on 
microfiche and the costs associated with its retrieval remain, the fees 
associated with microfiche retrieval will remain on the schedule.
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    \5\ See Letter to James C. Yong, Vice President, OCC (July 23, 
1993).
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    OCC believes that the proposed rule change is consistent with the 
requirements of Section 17A of the Act \6\ and the rules and 
regulations thereunder because it provides for the equitable allocation 
of dues, fees, and other charges among OCC's participants and other 
parties that use OCC's services.
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    \6\ 15 U.S.C. 78q-1.
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(B) Self-Regulatory Organization's Statement on Burden on Competition

    OCC does not believe that the proposed rule change will impose any 
burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act.

[[Page 54670]]

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

    No comments on the proposed rule change were solicited or received.

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) \7\ of the Act and pursuant to Rule 19b-4(e)(2)\8\ 
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 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.
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    \7\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \8\ 17 CFR 240.19b-4(e)(2).
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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 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-97-16 and should be submitted by November 12, 1997.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\9\
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    \9\???
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-27760 Filed 10-20-97; 8:45 am]
BILLING CODE 8010-01-M