Federal Register / Vol. 63, No. 125 /Tuesday, June 30, 1998 / Notices 35631

10 15 U.S.C. 78s(b)(2).

11 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 DTC and PTC.

3 DTC and PTC have informed the Commission

that the changes to DTC’s rules and procedures to

provide for the Division and to accommodate the

application of PTC’s current rules and procedures

to Division business will be the subject of a future

rule filing with the Commission.

4 15 U.S.C. 78q–1.

5 15 U.S.C. 78q–1.

6 15 U.S.C. 78q–1 and 78s.

IV. Solicitation of Comments

Interested person are invited to

submit written data, views and

arguments concerning Amendment No.

1, including whether it 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, DC 20549.

Copies of the submissions, 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

the 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 at

the Commission’s Public Reference

Room, 450 Fifth Street, N.W.,

Washington, DC 20549. Copies of such

filing will also be available for

inspection and copying at the principal

office of the CBOE. All submissions

should refer to File No. SR–CBOE–97–

41, and should be submitted by July 21,

1998.

V. Conclusion

It is Therefore Ordered, pursuant to

Section 19(b)(2) of the Act,10 that the

proposed rule change (SR–CBOE–97–

41) is approved.

For the Commission, by the Division of

Market Regulation, pursuant to delegated

authority.11

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 98–17294 Filed 6–29–98; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–40121; File Nos. SR–DTC–

98–12, SR–PTC–98–02]

Self-Regulatory Organizations; The

Depository Trust Company;

Participants Trust Company; Notice of

a Proposed Rule Change Relating to a

Proposed Merger Between The

Depository Trust Company and

Participants Trust Company

June 24, 1998.

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

Securities Exchange Act of 1934

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

May 29, 1998, The Depository Trust

Company (‘‘DTC’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) and on June 2, 1998,

Participants Trust Company (‘‘DTC’’)

filed with the Securities and Exchange

Commission (‘‘Commission’’) and on

June 2, 1998, Participants Trust

Company (‘‘PTC’’) filed with the

Commission proposed rule changes as

described in Items I, II, and III below,

which items have been prepared

primarily by DTC and PTC. The

Commission is publishing this notice to

solicit comments from interested

persons on the proposed rule changes.

I. Self-Regulatory Organizations’

Statement of the Terms of Substance of

the Proposed Rule Changes

The proposed rule changes relate to

the arrangements for a proposed merger

between DTC and PTC.

II. Self-Regulatory Organizations’

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Changes

In its filing with the Commission,

DTC and PTC included statements

concerning the purpose of and basis for

the proposed rule changes and

discussed any comments they received

on the proposed rule changes. The text

of these statements may be examined at

the places specified in Item IV below.

DTC and PTC have prepared summaries,

set forth in sections (A), (B), and (C)

below, of the most significant aspects of

such statements.2

(A) Self-Regulatory Organizations’

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Changes

In March 1998, PTC announced that

it had decided to seek an affiliation with

DTC. The arrangements for the proposed

merger provide the following. PTC will

merge with and into DTC, and DTC will

make certain payments to PTC’s

shareholders. For at least two years from

the effective date of the merger, DTC

will provide the services currently

offered by PTC in a separate division of

DTC (‘‘Division’’). The current rules and

procedures of PTC with respect to

depository services, the processing of

transactions in PTC-eligible securities,

and the PTC participants fund will be

incorporated into the rules and

procedures of DTC and will be applied

to the business of the Division.3 In

addition, DTC will offer PTC

participants that are not DTC

participants an opportunity to become

participants of the Division.

Under the proposed rule changes,

PTC’s users, most of which are also DTC

participants, will continue to have

access to the depository services offered

by PTC. DTC and PTC believe that the

proposed merger should assist in

eliminating redundant facilities and

thereby should reduce the costs of

processing transactions in mortgagebacked securities that are currently PTCeligible.

DTC and PTC believe that the

proposed rule changes are consistent

with the requirements of Section 17A of

the Act 4 and the rules and regulations

thereunder because the arrangements for

the proposed merger should assure that

continued availability to PTC users of

efficient and cost-effective depository

services and thereby should facilitate

the prompt and accurate clearance and

settlement of transactions in PTCeligible securities. In addition, the

proposed arrangements should provide

PTC participants with access to DTC’s

facilities and should be implemented

consistent with DTC’s obligations to

safeguard securities and funds in its

custody and control or for which it is

responsible.

(B) Self-Regulatory Organizations’

Statement on Burden on Competition

DTC and PTC believe that the

proposed arrangements will impose no

burden on competition. Securities

depositories registered under Section

17A of the Act 5 are utilities created to

serve members of the securities industry

for the purpose of providing certain

services that are ancillary to the

businesses in which industry members

compete with one another. Operating a

securities depository requires a

substantial and continuing investment

in infrastructure including securities

vaults, telecommunications links with

users, data centers, and disaster

recovery facilities in order to meet the

increasing needs of participants and to

respond to regulatory requirements.

DTC and PTC believe that the current

regulatory scheme and the particular

structure and nature of the depository

industry provide ample means to insure

that the merger of PTC with and into

DTC will achieve regulatory objectives.

Sections 17A and 19 of the Act 6 and the

rules thereunder provide the

Commission appropriate and effective

regulatory authority over DTC. DTC is
35632 Federal Register / Vol. 63, No. 125 /Tuesday, June 30, 1998 / Notices

7The Committee’s report is attached as Exhibit 2

to DTC’s filing, which is available for review and

inspection in the Commission’s public reference

room and through DTC. 8 17 CFR 200.30–3(a)(12).

owned by its members who utilize its

services, and its Board of Directors is

comprised of its members. DTC must

assure a fair representation of its

member in the selection of its directors

and administrators. DTC’s service fees

are reviewed by its board and subject to

public notice and comment.

After the consummation of the

proposed arrangements, securities

industry members will continue to have

access to high quality, low cost

depository and clearing services

provided under the mandate of the Act.

The overall cost to the industry of

having such services available will be

reduced and thereby should permit a

more efficient and productive allocation

of industry resources. Accordingly, DTC

and PTC believe that the proposed

transaction advances the objectives of

the national clearance and settlement

system without an inappropriate or

unnecessary burden upon competition.

(C) Self-Regulatory Organizations’

Statement on Comments on the

Proposed Rule Changes Received from

Members, Participation or Others

Written comments on the proposal

from DTC participants, PTC

participants, or others have not been

solicited or received. However, the

proposed arrangements have been

reviewed and approved by PTC’s Board

of Directors, which is comprised of

representatives of the banks and brokerdealers that are PTC’s stockholders and

participants. In addition, DTC believes

that the proposed arrangements are

consistent with recommendations made

by the Vision 2000 Committee

(‘‘Committee’’), a committee of industry

representatives of the Boards of DTC

and the National Securities Clearing

Corporation. The Committee’s report

dated September 1994 states that:

The industry currently owns a number of

utilities that provide services related to the

comparison, clearing, settlement and

safekeeping of U.S. (and to a lesser degree,

international) securities. These utilities

overlap in two ways. * * * We believe that

the industry’s and, as important, the

investors’, overall costs can be reduced and

safety and soundness can be enhanced by

eliminating these overlaps where there is no

clear advantage to having specialization or

competing development.7

III. Date of Effectiveness of the

Proposed Rule Changes and Timing for

Commission Action

Within thirty-five days of the date of

publication of this notice in the Federal

Register or within such longer period (i)

as the Commission may designate up to

ninety days of such date if it finds such

longer period to be appropriate and

publishes its reasons for so finding or

(ii) as to which DTC or PTC consents,

the Commission will:

(A) By order approve such proposed

rule changes or

(B) Institute proceedings to determine

whether the proposed rules changes

should be disapproved.

IV. Solicitation of Comments

Interested persons are invited to

submit written data, views, and

arguments concerning the foregoing,

including whether the proposed rule

changes are 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

changes that are filed with the

Commission, and all written

communications relating to the

proposed rule changes 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

offices of DTC and PTC. All submissions

should refer to File Nos. SR–DTC–98–12

and SR–PTC–98–02 and should be

submitted by July 21, 1998.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.8

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 98–17384 Filed 6–29–98; 8:45 am]

BILLING CODE 8010–01–M

OFFICE OF THE UNITED STATES

TRADE REPRESENTATIVE

Restoration of Preferential Tariff

Treatment Under the Generalized

System of Preferences for Certain

Articles From Thailand

AGENCY: Office of the United States

Trade Representative.

ACTION: Notice.

SUMMARY: Preferential tariff treatment

under the generalized System of

Preferences (GSP) is restored to four

articles from Thailand, effective with

respect to articles entered, or withdrawn

from warehouse, on or after the 15th day

after the date of publication of this

notice.

FOR FURTHER INFORMATION CONTACT:

Sean Murphy, Director for ASEAN

Affairs, Office of the U.S. Trade

Representative, (202) 395–6813.

SUPPLEMENTARY INFORMATION: Pursuant

to section 503(c)(2) of the Trade Act of

1974, as amended, 19 U.S.C. 2463(c)(2)),

beneficiary developing countries are

subject to competitive need limitations

on the preferential tariff treatment

afforded under the GSP. Proclamation

6813 of July 28, 1995 (60 FR 39095), in

relevant part, proclaimed the waiver of

competitive need limitations and the

restoration of GSP preferential tariff

treatment with respect to four articles

from Thailand, with an effective date to

be announced by the United States

Trade Representative by publication of

a notice in the Federal Register. These

four articles are in Harmonized Tariff

Schedule of the United States (‘‘HTS’’)

subheadings 6702.90.65 (certain

artificial flowers, foliage, fruit and parts

thereof); 7113.11.20 (certain articles of

silver jewelry and parts thereof, valued

at not over $18 per dozen); 7113.19.50

(certain other articles of jewelry and

parts thereof); and 9403.60.80 (certain

wooden furniture).

Pursuant to authority vested in the

United States Trade Representative by

the laws of the United States, including

but not limited to sections 503 and 604

of the Trade Act and Proclamation 6813

of July 28, 1995, and in order to restore

GSP preferential tariff treatment to

articles from Thailand in HTS

subheadings 6702.90.65, 7113.11.20,

7113.19.50, and 9403.60.80, the HTS is

modified as specified in the Annex to

this notice, effective with respect to

articles entered, or withdrawn from

warehouse, on or after the 15th day after

publication of this notice.

Susan Esserman,

Acting United States Trade Representative.

Annex

Section A. General note 4(d) to the

Harmonized Tariff Schedule of the United

States (‘‘HTS’’) is modified by:

(1) Deleting ‘‘6702.90.65 Thailand’’ and

‘‘7113.11.20 Thailand’’; and

(2) Deleting ‘‘Thailand’’ set out opposite

subheading 7113.19.50 and opposite

subheading 9403.60.80.

Section B. For HTS subheadings

6702.90.65 and 7113.11.20, the Rates of Duty

1-Special subcolumn is modified by deleting