Federal Register / Vol. 63, No. 76 /Tuesday, April 21, 1998 / Notices 19781

3For members with ten or less assigned numbers,

this cap is $200 per month, and for members with

more than ten assigned numbers, the cap is $150

for the first ten numbers and $75 for each additional

number.

4The individual fees are $50 for Fund/SERV

membership, $50 for mutual fund commission

settlement membership, and $200 for networking

membership taking into account the reduction

made by this filing.

5 15 U.S.C. 78s(b)(3)(A)(ii).

6 17 CFR 240.19b–(e)(2).

7 17 CFR 200.30–3(A)(12)

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

2Securities Exchange Act Release No. 39563

(January 20, 1998) 63 FR 4336.

3NSCC members used the ‘‘delete of original

trade input’’ instruction to delete any item for

which the comparison process resulted in an

uncompared trade.

position, $.50 per delivery on CNS in

the night processing cycle to cover a

short valued position, and $1.25 per

delivery to CNS in the day processing

cycle to cover a short valued position.

Each of these three fees includes a $.075

charge associated with a CNS delivery

order movement. Under this rule

change, the charge for CNS delivery

order movements will be reflected as a

separate charge of $.06 instead of $.075.

To reflect both the removal of the

delivery order movement component of

these fees and the additional reductions,

the trade clearance fees for these items

are being reduced as follows: $.40 per

issue received from CNS to satisfy a

long valued position, $.40 per delivery

to CNS in the night processing cycle to

cover a short valued position, and $1.00

per delivery to CNS in the day

processing cycle to cover a short valued

position.

(4) Membership Fees

NSCC is making two changes with

respect to its membership fees. First, it

is reducing its networking membership

fee from $250 to $200 per month.

Second, NSCC currently has a cap on

the aggregate dollar amount of

membership fees which it charges for

the following services: trade processing

systems, envelope settlement system,

dividend settlement service, and Fund/

SERV.3 NSCC is removing Fund/SERV

from this cap and is implementing a

new cap of $200 on the aggregate dollar

amount of membership fees that may be

charged to a participant for use of Fund/

SERV, networking, and mutual fund

commission settlement.4

(5) Other Mutual Fund Related Fees

Other mutual fund related fees are

being reduced. The Fund/SERV

transaction fee is being reduced from

$.35 to $.30 per side per order or

transfer request. The networking

account base fees for accounts relating

to funds paying monthly dividends are

being reduced from $.025 to $.020 per

networking subaccount and from $.015

to $.010 for accounts relating to funds

paying dividends less frequently than

monthly. The minimum charge for

mutual fund commission record

submissions is being reduced from $100

to $50.

NSCC intends to give members the

benefit of these fee changes effective as

of January 1, 1998. The necessary

adjustments to accommodate these

reductions will be reflected in bills

transmitted to members in March 1998.

NSCC believes that the proposed rule

change is consistent with the

requirements of Section 17A of the Act,

and the rules and regulations

thereunder because it provides for the

equitable allocation of dues, fees, and

other charges among NSCC’s members.

(B) Self-Regulatory Organization’s

Statement on Burden on Competition

NSCC does not believe that the

proposed rule change will impact or

impose a burden on competition.

(C) Self-Regulatory Organization’s

Statement on Comments on the

Proposed Rule Change Received From

Members, Participants or Others

No written comments have been

solicited or received. NSCC will notify

the Commission of any written

comments received by NSCC.

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 pursuant

to Rule 19b–4(e)(2) 6 promulgated

thereunder because the proposal

establishes or changes a due, fee, or

other charge imposed by NSCC. 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.

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. 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 NSCC. All submissions should

refer to File No. SR–NSCC–98–1 and

should be submitted by May 12, 1998.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.7

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 98–10419 Filed 4–20–98; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39864; File No. SR–NSCC–

97–14]

Self-Regulatory Organizations;

National Securities Clearing

Corporation; Order Granting Approval

of a Proposed Rule Change to Modify

NSCC’s Rules Regarding its Trade

Comparison Service

April 14, 1998.

On December 9, 1997, the National

Securities Clearing Corporation

(‘‘NSCC’’) filed with the Securities and

Exchange Commission (‘‘Commission’’)

the proposed rule change (File No. SR–

NSCC–97–14) pursuant to Section

19(b)(1) of the Securities Exchange Act

of 1934 (‘‘Act’’) 1 to modify NSCC’s

procedures regarding its trade

comparison system for over-the-counter

(‘‘OTC’’) securities. Notice of the

proposal was published in the Federal

Register on January 28, 1998.2 No

comment letters were received. For the

reasons discussed below, the

Commission is granting approval of the

proposed rule change.

I. Description

The rule change modifies NSCC’s

trade comparison service by

discontinuing the ability of members to

submit the following instructions:

‘‘delete of original trade input,’’ 3
19782 Federal Register / Vol. 63, No. 76 /Tuesday, April 21, 1998 / Notices

4The ‘‘demand withhold’’ instruction deleted

previously compared OTC transactions that have

been canceled by mutual agreement of the buyer

and the seller.

5The ‘‘demand as of’’ instruction permitted

uncompared OTC trade data submitted by members

to be resubmitted.

6Advisory listings indicate trades that were

submitted by another party against the member but

that did not match any trade the member submitted.

7The supplemental contract lists show all

compared trades resulting from adjustments

submitted on T+1. The added trade contract lists

show trades that are compared on T+2 and

thereafter.

8 15 U.S.C. 78q–1(b)(3)(F).

9 17 CFR 200.30–3(a)(12).

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

2The Commission has modified the text of the

summaries prepared by OCC. 4 15 U.S.C. 78q–1.

‘‘demand withhold,’’ 4 and ‘‘demand as

of.’’ 5 Such instructions are used very

infrequently by NSCC members due to

the growth of automated processing

systems. Additionally, the change

eliminates members’ ability to submit

an advisory listing after the first day

after trade date (‘‘T+1’’) for original

input and as of trades.6 Under the third

change, the supplemental contract lists

and the added trade contract lists no

longer carry forward totals from prior

days.7

II. Discussion

Section 17A(b)(3)(F) 8 provides that

the rules of a clearing agency must be

designed to facilitate the prompt and

accurate clearance and settlement of

securities transactions. The Commission

believes that the rule change is

consistent with NSCC’s obligations

under the Act because it permits NSCC

to discontinue certain functions that are

rarely used or that no longer serve a

useful function. Discontinuing these

functions permits NSCC to focus its

resources on functions that provide

greater benefits to its members. Thus,

the proposal may assist NSCC in

fulfilling its obligation to facilitate the

prompt and accurate 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–

NSCC–97–14) be and hereby is

approved.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.9

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 98–10505 Filed 4–20–98; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–39862; File No. SR–OCC–

98–01]

Self-Regulatory Organizations; The

Options Clearing Corporation; Notice

of Filing and Immediate Effectiveness

of Proposed Rule Change Relating to

Fees and Charges

April 14, 1998.

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

Securities Exchange Act of 1934

(‘‘Act’’),1 notice is hereby given that on

February 2, 1998, 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.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The proposed rule change will amend

OCC’s fee schedule relating to fees for

established products and to

introductory clearing fees for new

products.

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 such statements.2

(A) Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

OCC’s current clearing fee for

established products is $.10 per

contract, per side. Under the proposed

rule change this single clearing fee will

be replaced with the following fee

structure:

Cleared trades of— Clearing fee (per

side)—

1–500 contracts ......... $0.09 per contract.

Cleared trades of— Clearing fee (per

side)—

501–1,000 contracts .. .07 per contract.

1,001–2,000 contracts .06 per contract.

Greater than 2,000

contracts.

110.00 per trade.

In addition, OCC’s introductory

clearing fees for new products currently

are (i) $.00 per contract per side for the

first month the new product is traded;

(ii) $.025 per contract per side for the

second month the new product is

traded; (iii) $.050 per contract per side

for the third month the new product is

traded; and (iv) $.10 for the fourth

month the new product is traded and

thereafter. Under the proposed rule

change, OCC’s current introductory fees

will be replaced with the following fee

structure:

New products Clearing fee

(per side)

First Calendar Month Traded $0.00

Second Calendar Month Traded:

Cleared trades of:

1–4,400 contracts ..... a .025

Greater than 4,400

contracts ............... b 110.00

Third Calendar Month Traded:

Cleared trades of:

1–2,200 contracts ..... a .050

Greater than 2,200

contracts ............... b, 3 110.00

aPer contract. bPer trade. 3OCC has informed the Commission that it

is modifying the introductory fees for cleared

trades of more than 4,400 contracts during the

second calendar month and of more than

2,200 trades during the third calendar month

so that introductory fees for new products do

not exceed the volume discounts under the

regular fee schedule.

In the fourth calendar month that the

new product is traded and thereafter,

OCC will begin charging its clearing fees

for established products. Cleared trades

will be determined with reference to the

matched trades reported to OCC by its

participant exchanges.

OCC believes that the proposed rule

change is consistent with the

requirements of Section 17A of the Act 4

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 who use OCC’s

services.

(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.