[Federal Register Volume 62, Number 236 (Tuesday, December 9, 1997)]
[Notices]
[Pages 64901-64902]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-32172]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-39387; File No. SR-DTC-97-13]


Self-Regulatory Organizations; the Depository Trust Company; 
Order Approving a Proposed Rule Change Regarding the Branch Deposit 
Service

December 2, 1997.
    On June 30, 1997, The Depository Trust Company (``DTC'') filed with 
the Securities and Exchange Commission (``Commission'') a proposed rule 
change (File No. SR-DTC-97-13) 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 September 19, 1997.\2\ No 
comment letters were received. For the reasons discussed below, the 
Commission is approving the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ Securities Exchange Act Release No. 39075 (September 12, 
1997), 62 FR 49279.
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I. Description

    DTC currently operates a branch deposit service (``BDS'') through 
which DTC participants may route securities certificates and related 
documentation from their branches and other satellite offices directly 
to DTC rather than routing them through the participants' own central 
locations for processing before they are deposited at DTC.\3\ The rule 
change permits DTC to enter into contracts with individual participants 
to provide customized processing services

[[Page 64902]]

under BDS. Under the proposed rule change, DTC will not be obligated to 
enter into any such contracts with participants or to offer the same 
terms under any such contracts to all participants. DTC has advised the 
Commission that it will base all fees charged for customization of BDS 
based on a consistently applied methodology.
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    \3\ For a complete description of BDS, refer to Securities 
Exchange Act Release No. 34600 (August 25, 1994), 59 FR 45317 [File 
No. SR-DTC-94-05] (order approving proposed rule change).
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II. Discussion

    Section 17A(b)(3)(F) of the Act \4\ requires that the rules of a 
clearing agency be designed to remove impediments to and perfect the 
mechanism of a national system for prompt and accurate clearance and 
settlement of securities transactions. The Commission believes that the 
proposed rule change is consistent with DTC's obligations under Section 
17A(b)(3)(F) because it should increase the use of BDS by DTC's 
participants. This increase in use should improve efficiency in the 
processing of securities certificates by eliminating most of the 
certificate processing responsibilities of those participants electing 
to use BDS and by reducing the movement of physical securities 
certificates. This reduction in the processing and movement of physical 
securities certificates also should improve efficiency by reducing the 
instances of erroneous processing and loss that sometimes occur with 
physical certificates.
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    \4\ 15 U.S.C. 78q-1(b)(3)(F).
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III. Conclusion

    On the basis of the foregoing, the Commission finds that the 
proposal is consistent with the requirements of the Act and in 
particular with the requirements of 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-97-13) be, and hereby 
is, approved.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\5\
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    \5\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-32172 Filed 12-8-97; 8:45 am]
BILLING CODE 8010-01-M