Federal Register / Vol. 70, No. 189 / Friday, September 30, 2005 / Rules and Regulations 57437 

court order, divorce decree, or property 

settlement agreement. You must certify 

online that the transfer is a gift or a 

specified exception. 

* * * * * 

■ 43. Remove the undesignated center 

heading ‘‘Registration’’, located prior to 

363.65. 

§§ 363.65–363.69 [Removed and reserved] 

■ 44. Remove and reserve §§ 363.65, 

363.66, 363.67, 363.68, and 363.69. 

■ 45. Amend § 363.83 by revising the 

heading to read as follows: 

§ 363.83 May an account owner transfer a 

book-entry savings bond to a minor? 

* * * * * 

■ 46. Remove the undesignated center 

heading ‘‘Deceased Owners,’’ located 

prior to § 363.90. 

§ 363.90 [Removed and reserved] 

■ 47. Remove and reserve § 363.90. 

■ 48. Amend § 363.95 by revising the 

heading and the introductory text to 

read as follows: 

§ 363.95 How may I give a book-entry 

savings bond as a gift? 

You may give a book-entry savings 

bond as a gift in two ways: 

* * * * * 

■ 49. Amend § 363.97 by revising the 

heading to read as follows: 

§ 363.97 What do I need to know if I 

transfer a book-entry savings bond to 

another person as a gift? 

* * * * * 

■ 50. Remove the undesignated center 

heading ‘‘Transactions,’’ located prior to 

§ 363.105. 

§§ 363.105–363.107 [Removed and 

reserved] 

■ 51. Remove and reserve §§ 363.105, 

363.106, and 363.107. 

■ 52. Remove the undesignated center 

heading ‘‘Judicial and Administrative 

Proceedings,’’ located prior to § 363.110. 

§§ 363.110–363.119 [Removed and 

reserved] 

■ 53. Remove and reserve §§ 363.110 

through 363.119. 

■ 54. Amend § 363.125 by revising the 

heading to read as follows: 

§ 363.125 How is payment made on a 

book-entry savings bond? 

* * * * * 

■ 55. Remove § 363.146. 

§§ 363.147–363.149 [Removed and 

reserved] 

■ 56. Remove and reserve §§ 363.147–

363.149. 

§ 363.150 [Reserved] 

■ 57. Redesignate § 363.150 as § 363.146 

and reserve § 363.150. 

§§ 363.151–363.152 [Removed and 

reserved] 

■ 58. Remove and reserve §§ 363.151 

and 363.152. 

■ 59. Amend § 363.160 by revising 

paragraph (a)(4) to read as follows: 

§ 363.160 What subparts govern the 

conversion of definitive savings bonds? 

(a) * * * 

(4) Converted savings bonds of all 

series that are held as gift bonds by the 

person who converted the bonds. 

* * * * * 

■ 60. Amend § 363.165 by revising the 

heading and the first sentence of 

paragraph (b) to read as follows: 

§ 363.165 What happens when I convert a 

savings bond that is registered in my name 

as the owner, either coowner, or the owner 

with a beneficiary? 

* * * * * 

(b) Savings bond that has reached 

final maturity. A savings bond that has 

reached final maturity and is registered 

in the name of the Treasury Direct 

account owner as single owner, either 

coowner, or owner with beneficiary, 

will be converted to a book-entry bond 

and automatically redeemed. * * * 

■ 61. Amend § 363.166 by: 

■ a. Revising the heading and the first 

sentence of paragraph (b)(1); and 

■ b. Revising the heading and first 

sentence of paragraph (b)(2), to read as 

follows: 

§ 363.166 What happens when I convert a 

savings bond that is not registered in my 

name as owner, either coowner, or owner 

with beneficiary (including a bond 

registered in the name of a minor)? 

* * * * * 

(b) Savings bond that has reached 

final maturity. (1) General. A savings 

bond that has reached final maturity 

and is registered in the name of 

someone other than the account owner 

will be converted to a book-entry bond, 

released as a gift bond into the account 

owner’s conversion linked account, and 

automatically redeemed. * * * 

(2) Delivery of bond proceeds to 

registered owner. If the gift bond has 

reached final maturity and has been 

automatically redeemed, then the 

Treasury Direct account owner may 

direct that the held redemption 

proceeds be delivered to the Treasury 

Direct account of the registered owner 

(or minor linked account, if the 

registered owner is a minor), where we 

will use the proceeds to purchase a 

certificate of indebtedness in the name 

of the registered owner. * * * 

§§ 363.172–363.174 [Removed and 

reserved] 

■ 62. Remove and reserve §§ 363.172, 

363.173, and 363.174. 

§ 363.175 [Removed and reserved] 

■ 63. Remove and reserve §§ 363.175. 

§ 363.177 [Removed and reserved] 

■ 64. Remove and reserve §§ 363.177. 

§ 363.178 [Removed and reserved] 

■ 65. Remove and reserve §§ 363.178. 

Dated: September 26, 2005. 

Donald V. Hammond, 

Fiscal Assistant Secretary. 

[FR Doc. 05–19551 Filed 9–27–05; 12:41 pm] 

BILLING CODE 4810–39–P 

DEPARTMENT OF THE TREASURY 

Fiscal Service 

31 CFR Parts 356, 357, and 363 

[Docket No. BPD–CC–05–2] 

Sale and Issue of Marketable BookEntry Treasury Bills, Notes, and Bonds 

(Department of the Treasury Circular, 

Public Debt Series No. 1–93); 

Regulations Governing Book-Entry 

Treasury Bonds, Notes and Bills Held 

in Legacy Treasury Direct; 

Regulations Governing Securities Held 

in TreasuryDirect

AGENCY: Bureau of the Public Debt, 

Fiscal Service, Treasury. 

ACTION: Final rule. 

SUMMARY: TreasuryDirect is an accountbased, book-entry, online system for 

purchasing, holding, and conducting 

transactions in Treasury securities. To 

date, the system has only been available 

for the purchase and holding of savings 

bonds and certificates of indebtedness. 

The Department of the Treasury 

(hereinafter referred to as ‘‘Treasury’’ or 

‘‘We’’) is amending Regulations 

Governing Securities Held in 

TreasuryDirect to add marketable 

Treasury securities to the securities that 

may be purchased and held in 

TreasuryDirect and to provide the terms 

and conditions for marketable Treasury 

securities held in the system. We are 

amending Regulations Governing BookEntry Treasury Bonds, Notes and Bills 

Held in Legacy Treasury Direct to 

provide for the transfer of securities 

between Legacy Treasury Direct and 

TreasuryDirect. We are also amending 

the Uniform Offering Circular for the 

Sale and Issue of Marketable Book-Entry 

Treasury Bills, Notes, and Bonds to 

make the changes necessary to 

57438 Federal Register / Vol. 70, No. 189 / Friday, September 30, 2005 / Rules and Regulations 

1The governing regulations for the TreasuryDirect 

system, 31 CFR part 363, were originally published 

as a final rule October 17, 2002 (67 FR 64275). The 

regulations were subsequently amended May 8, 

2003 (68 FR 24793); January 16, 2004 (69 FR 2506); 

August 16, 2004 (69 FR 50307); March 23, 2005 (70 

FR 14940); and September 30, 2005. The 

TreasuryDirect system was first referred to as New 

Treasury Direct to distinguish it from an older 

system for holding book-entry Treasury bills, notes 

and bonds directly with Treasury, also known as 

TreasuryDirect. The regulations for the older system 

are found at 31 CFR part 357. The name of the 

newer system was changed in the most recent 

amendment to the TreasuryDirect regulations, and 

at the same time the name of the older system was 

changed to Legacy Treasury Direct. 

2The Uniform Offering Circular was published as 

a final rule on January 5, 1993 (58 FR 411). The 

circular, as amended, is codified at 31 CFR part 356. 

A final rule converting the UOC to plain language 

and making certain other minor changes was 

published in the Federal Register on July 28, 2004 

(69 FR 45202). 

accommodate participation in Treasury 

marketable securities auctions for 

securities to be held in either the 

TreasuryDirect or the Legacy Treasury 

Direct system. We are also eliminating 

the ability to bid competitively through 

Legacy Treasury Direct. These final 

amendments benefit individual 

investors by allowing them to purchase, 

hold and conduct transactions in 

marketable Treasury securities through 

the TreasuryDirect system. 

DATES: Effective Date: September 30, 

2005. 

ADDRESSES: You can download this final 

rule at the following Internet addresses: 

http://www.publicdebt.treas.gov or 

http://www.gpoaccess.gov/ecfr. 

FOR FURTHER INFORMATION CONTACT:

Elisha Whipkey, Director, Division of 

Program Administration, Office of 

Securities Operations, Bureau of the 

Public Debt, at (304) 480–6319 or 

elisha.whipkey@bpd.treas.gov for 

information on the TreasuryDirect 

and Legacy Treasury Direct systems. 

Chuck Andreatta, Associate Director, 

Government Securities Regulations 

Staff, Bureau of the Public Debt, at 

(202) 504–3632 or 

govsecreg@bpd.treas.gov for 

information on Treasury marketable 

securities auction rules (31 CFR part 

356). 

Susan Klimas, Attorney-Adviser, Dean 

Adams, Assistant Chief Counsel, 

Edward Gronseth, Deputy Chief 

Counsel, Office of the Chief Counsel, 

Bureau of the Public Debt, at (304) 

480–8692 or 

susan.klimas@bpd.treas.gov for 

information on regulations governing 

TreasuryDirect and Legacy Treasury 

Direct (31 CFR parts 357 and 363). 

SUPPLEMENTARY INFORMATION:

TreasuryDirect is an account-based, 

online, book-entry system for 

purchasing, holding, and conducting 

transactions in Treasury securities. 

Currently, book-entry Series EE and 

Series I savings bonds and certificates of 

indebtedness are offered for purchase. 

In addition, definitive savings bonds 

may be converted to book-entry savings 

bonds through TreasuryDirect and held 

in the system. We are issuing this 

amendment to 31 CFR parts 363, 357, 

and 356 to provide for the purchase and 

holding of marketable Treasury 

securities in TreasuryDirect. 

31 CFR Part 363. We are amending 31 

CFR part 363, Regulations Governing 

Securities Held in TreasuryDirect, to 

add marketable Treasury securities to 

the securities that may be held in the 

TreasuryDirect system.1 The previous 

subpart F is redesignated as subpart H, 

and a new subpart F has been added to 

address the unique terms and 

conditions for holding marketable 

Treasury securities in TreasuryDirect. 

The provisions in subpart B, which 

apply to all securities held in 

TreasuryDirect, will apply to marketable 

Treasury securities as well. Therefore, 

the current provisions in subpart B 

relating to rules of the system, 

registrations, administrative and judicial 

proceedings, and decedents’ estates, that 

are applicable to all securities in 

TreasuryDirect, will apply to marketable 

Treasury securities. 

A TreasuryDirect account owner can 

submit a noncompetitive bid for eligible 

marketable Treasury securities online 

through his or her account. Marketable 

Treasury securities that are eligible for 

purchase through a TreasuryDirect 

account are those that are available for 

purchase through the TreasuryDirect 

Web site. Any registration provided in 

subpart B for securities held in 

TreasuryDirect is available for 

marketable Treasury securities. 

Upon the purchase of a marketable 

Treasury security, there will be a period 

of 45 calendar days after the issue date 

of the security, or the term of the 

security, whichever is less, during 

which the security may not be 

transferred. This holding period is to 

prevent a loss to Treasury in the event 

of a returned or unauthorized debit. In 

addition, and for a similar reason, we 

are amending subpart D, relating to 

certificates of indebtedness, to provide 

for a holding period of 5 business days 

after a debit entry for the purchase of a 

certificate of indebtedness. During this 

holding period the certificate of 

indebtedness may only be redeemed to 

purchase a new security and may not be 

redeemed for cash. 

This final rule provides for the 

transfer of marketable Treasury 

securities among the commercial bookentry system, the Legacy Treasury Direct 

system, and the TreasuryDirect system. 

Online transfers available for marketable 

Treasury securities are transfers 

between TreasuryDirect accounts, 

transfers to other book-entry systems, 

and transfers to our agent for sale on the 

open market (Sell Direct), in increments 

of $1000. Any eligible marketable bookentry Treasury bill, note, or bond may 

be transferred into and held in a 

TreasuryDirect account. 

Under the provisions of this 

amendment, an account owner may 

reinvest a matured security held in 

TreasuryDirect by directing that the 

redemption proceeds of the security be 

used to purchase a certificate of 

indebtedness, and then using the 

redemption proceeds of the certificate of 

indebtedness to purchase a new 

marketable Treasury security. 

The process in TreasuryDirect for 

handling undeliverable payments of 

either principal or interest will benefit 

both investors and Treasury. 

Undeliverable proceeds will be used to 

purchase a certificate of indebtedness in 

the name of the account owner. The 

account owner can then directly access 

the certificate of indebtedness online 

through the account, rather than having 

to contact Treasury to make 

arrangements for delivery of the 

payment. 

A four-business day closed book 

period will be in effect prior to the date 

a marketable security payment is made. 

This means that certain transactions 

made during the closed book period will 

be delayed until after the closed book 

period is completed and the payment is 

made. 

31 CFR Part 357. We are amending 31 

CFR part 357, Regulations Governing 

Book-Entry Treasury Bonds, Notes and 

Bills Held in Legacy Treasury Direct, to 

provide that marketable Treasury 

securities may be transferred between 

Legacy Treasury Direct and 

TreasuryDirect. 

31 CFR Part 356. 31 CFR part 356, 

also referred to as the Uniform Offering 

Circular (UOC), sets out the terms and 

conditions for the sale and issuance to 

the public of marketable Treasury bills, 

notes, and bonds. The UOC, in 

conjunction with offering 

announcements, represents a 

comprehensive statement of those terms 

and conditions.2

This amendment makes changes to 

the UOC to allow bidders to bid for 

marketable Treasury securities to be 

issued in either the TreasuryDirect or 

Federal Register / Vol. 70, No. 189 / Friday, September 30, 2005 / Rules and Regulations 57439 

Legacy Treasury Direct direct-holding 

systems. The amendment 

accommodates the differences between 

the systems, such as the methods of 

payment. The amendment makes one 

substantive change, described below, 

which is that competitive bidding will 

no longer be allowed for securities to be 

held in Legacy Treasury Direct. 

Competitive bidding will not be 

allowed for securities to be held in 

either the new TreasuryDirect system or 

in Legacy Treasury Direct. Although 

competitive bidding has been allowed 

since Legacy Treasury Direct was first 

implemented in 1986, our experience 

has been that the volume of such bids 

has been so low that it does not justify 

continuing to provide the service. 

Accordingly, § 356.12 has been 

amended to stipulate that it will not be 

a feature of either system going forward. 

Procedural Requirements 

This final rule does not meet the 

criteria for a ‘‘significant regulatory 

action’’ as defined in Executive Order 

12866. Therefore, a regulatory 

assessment is not required. 

Because this final rule relates to 

matters of public contract and 

procedures for United States securities, 

notice and public procedure and 

delayed effective date requirements are 

inapplicable, pursuant to 5 U.S.C. 

553(a)(2). 

As no notice of proposed rulemaking 

is required, the Regulatory Flexibility 

Act (5 U.S.C. 601 et seq.) does not 

apply. 

We ask for no new collections of 

information in this final rule. Therefore, 

the Paperwork Reduction Act (44 U.S.C. 

3507) does not apply. 

List of Subjects 

31 CFR Part 356 

Bonds, Federal Reserve System, 

Government securities, Securities. 

31 CFR Part 357 

Banks, Banking, Bonds, Electronic 

funds transfers, Government securities, 

Reporting and recordkeeping 

requirements. 

31 CFR Part 363 

Bonds, Electronic funds transfer, 

Federal Reserve system, Government 

securities, Securities. 

■ Accordingly, for the reasons set out in 

the preamble, 31 CFR chapter II, 

subchapter B, is amended as follows: 

PART 356—SALE AND ISSUE OF 

MARKETABLE BOOK-ENTRY 

TREASURY BILLS, NOTES AND 

BONDS (DEPARTMENT OF THE 

TREASURY CIRCULAR, PUBLIC DEBT 

SERIES NO. 1–93) 

■ 1. The authority citation for part 356 

continues to read as follows: 

Authority: 5 U.S.C. 301; 31 U.S.C. 3102 et 

seq.; 12 U.S.C. 391. 

■ 2. Amend part 356 by revising 

‘‘TreasuryDirect’’ or ‘‘Legacy Treasury 

Direct’’ to read ‘‘TreasuryDirect ’’ or 

‘‘Legacy Treasury Direct’’ the first time 

they appear in each section or section 

heading in the part. 

■ 3. Section 356.2 is amended by 

revising the definitions of ‘‘Autocharge 

agreement,’’ ‘‘Book-entry security,’’

Security and ‘‘TreasuryDirect,’’ and by 

adding in alphabetical order the 

definitions of ‘‘Certificate of 

indebtedness’’ and ‘‘Legacy Treasury 

Direct’’ to read as follows: 

§ 356.2 What definitions do I need to know 

to understand this part? 

* * * * * 

Autocharge agreement means an 

agreement in a format acceptable to 

Treasury between a submitter or 

clearing corporation and a depository 

institution that authorizes us to: 

(1) Deliver awarded securities to: 

(i) The book-entry securities account 

of a designated depository institution in 

the commercial book-entry system, or 

(ii) An account in Legacy Treasury 

Direct, and 

(2) Charge a funds account of a 

designated depository institution for the 

settlement amount of the securities. 

* * * * * 

Book-entry security means a security 

that is issued and maintained as an 

accounting entry or electronic record in 

either the commercial book-entry 

system or in one of Treasury’s two 

direct-hold systems—TreasuryDirect or 

Legacy Treasury Direct. (See § 356.4.) 

* * * * * 

Certificate of indebtedness means a 

one-day non-interest-bearing security 

that may be held in TreasuryDirect and 

that automatically matures and is rolled 

over each day until its owner requests 

that it be redeemed. 

* * * * * 

Legacy Treasury Direct means a nonInternet-based book-entry system 

maintained by Treasury for purchasing 

and holding marketable Treasury 

securities directly with Treasury. (See 

31 CFR part 357.) 

* * * * * 

Security means a Treasury bill, note, 

or bond, each as described in this part. 

Security also means any other obligation 

we issue that is subject to this part 

according to its auction announcement. 

Security includes an interest or 

principal component under the STRIPS 

program, as well as a certificate of 

indebtedness in an investor’s 

TreasuryDirect account. 

* * * * * 

TreasuryDirect means the book-entry, 

online system maintained by Treasury 

for purchasing and holding marketable 

Treasury securities, nonmarketable 

savings bonds, and certificates of 

indebtedness directly with Treasury. 

(See 31 CFR part 363.) 

* * * * * 

■ 4. Section 356.4 is amended by 

revising the introductory text and 

paragraph (b), and by adding a new 

paragraph (c) to read as follows: 

§ 356.4 What are the book-entry systems 

in which auctioned Treasury securities may 

be issued? 

There are three book-entry securities 

systems—the commercial book-entry 

system, TreasuryDirect, and Legacy 

Treasury Direct—into which we issue 

marketable Treasury securities. We 

maintain and transfer securities in these 

three book-entry systems at their par 

amount. Par amounts of Treasury 

inflation-protected securities do not 

include adjustments for inflation. 

Securities may be transferred from one 

system to the other. See Department of 

the Treasury Circular, Public Debt 

Series No. 2–86, as amended (31 CFR 

part 357) and 31 CFR part 363. 

* * * * * 

(b) TreasuryDirect. In this system, 

account holders maintain accounts in a 

book-entry, online system directly on 

the records of the Bureau of the Public 

Debt, Department of the Treasury. Bids 

for securities to be held in 

TreasuryDirect are submitted through 

the Internet. 

(c) Legacy Treasury Direct. In this 

system, we maintain the book-entry 

securities of account holders directly on 

the records of the Bureau of the Public 

Debt, Department of the Treasury. Bids 

for securities to be held in Legacy 

Treasury Direct are generally submitted 

directly to us, although such bids may 

also be forwarded to us by a depository 

institution or dealer. 

■ 5. Section 356.5 is amended by 

revising the introductory text to read as 

follows: 

§ 356.5 What types of securities does the 

Treasury auction? 

We offer securities under this part 

exclusively in book-entry form and as 

direct obligations of the United States 

57440 Federal Register / Vol. 70, No. 189 / Friday, September 30, 2005 / Rules and Regulations 

issued under Chapter 31 of Title 31 of 

the United States Code. The securities 

are subject to the terms and conditions 

in this part, the regulations in 31 CFR 

part 363 (for securities held in 

TreasuryDirect), the regulations in 31 

CFR part 357 (for securities held in the 

commercial book-entry system and 

Legacy Treasury Direct), and the auction 

announcements. When we issue 

additional securities with the same 

CUSIP number as outstanding 

securities, we consider them to be the 

same securities as the outstanding 

securities. 

* * * * * 

■ 6. Section 356.11 is amended by 

revising the first sentence of paragraph 

(a)(1), by revising paragraph (c), and by 

adding a new paragraph (d) to read as 

follows: 

§ 356.11 How are bids submitted in an 

auction? 

(a) General. (1) All bids must be 

submitted using an approved method, 

which depends on whether you are 

requesting us to issue the awarded 

securities in the commercial book-entry 

system, in TreasuryDirect, or in Legacy 

Treasury Direct (See § 356.4). * * * 

* * * * * 

(c) TreasuryDirect. You must submit 

your bids through your established 

book-entry, online TreasuryDirect 

account. You may reinvest the proceeds 

of maturing securities held in 

TreasuryDirect by directing that the 

proceeds be used to purchase a 

certificate of indebtedness in your 

TreasuryDirect account and by using the 

proceeds of your certificate of 

indebtedness to pay for the securities. 

(d) Legacy Treasury Direct. (1) If you 

are a submitter and the awarded 

securities are to be issued in Legacy 

Treasury Direct, you may submit bids by 

using one of our approved methods, e.g., 

computer, automated telephone service, 

or paper forms. You may also reinvest 

the proceeds of maturing securities into 

new securities through the same 

methods. 

(2) If you are submitting bids by paper 

form, you must use forms authorized by 

the Bureau of the Public Debt and 

provide the requested information. We 

have the option of accepting or rejecting 

bids on any other form. You are 

responsible for ensuring that we receive 

bids in paper form on time. A 

noncompetitive bid is on time if: 

(i) We receive it on or before the issue 

date, and 

(ii) The envelope it arrived in bears 

evidence, such as a U.S. Postal Service 

cancellation, that it was mailed prior to 

the auction date. 

(3) If you are submitting a bid by 

computer or automated telephone 

service you must be an established 

Legacy Treasury Direct account holder 

with a Taxpayer Identification Number. 

(4) In contingency situations, such as 

a power outage, we may accept bids by 

other means, provided, that in all cases 

the bids are submitted prior to the 

relevant bidding deadline by an 

established Legacy Treasury Direct 

account holder. 

■ 7. Section 356.12 is amended by 

revising paragraphs (b)(1) and (c)(3) to 

read as follows: 

§ 356.12 What are the different types of 

bids and do they have specific 

requirements or restrictions? 

* * * * * 

(b) Noncompetitive bids. (1) 

Maximum bid. You may not bid 

noncompetitively for more than $5 

million. The maximum bid limitation 

does not apply if you are bidding solely 

through either a TreasuryDirect or a 

Legacy Treasury Direct reinvestment 

request. A request for reinvestment of 

securities maturing in either 

TreasuryDirect or Legacy Treasury 

Direct is a noncompetitive bid. 

* * * * * 

(c) * * * 

(3) Additional restrictions. You may 

not bid competitively in an auction in 

which you are bidding 

noncompetitively. You may not bid 

competitively for securities to be bought 

through either TreasuryDirect or Legacy 

Treasury Direct. 

■ 8. Section 356.17 is amended by 

redesignating paragraphs (b) and (c) as 

paragraphs (c) and (d), respectively, 

adding new paragraph (b) and revising 

newly redesignated paragraphs (c) and 

(d) to read as follows: 

§ 356.17 How and when do I pay for 

securities awarded in an auction? 

* * * * * 

(b) TreasuryDirect. You must pay for 

your awarded securities by a debit entry 

to a deposit account that you are 

authorized to debit or by using the 

redemption proceeds of your certificate 

of indebtedness held in your 

TreasuryDirect account. Payment by 

debit entry occurs on the settlement 

date for the actual settlement amount 

due. (See § 356.25.) 

(c) Legacy Treasury Direct. Unless you 

make other provisions, you must pay by 

debit entry to a deposit account that you 

are authorized to debit or submit 

payment with your bids. Payment by 

debit entry occurs on the settlement 

date for the actual settlement amount 

due. (See § 356.25.) If you are paying 

with a check or with maturing 

securities, you must pay separately for 

any premium, accrued interest, or 

inflation adjustment as soon as you 

receive your Payment Due Notice. 

(1) Bidding and payment by computer 

or by telephone. If you are bidding by 

computer or by telephone, you must pay 

for any securities awarded to you by 

debit entry to a deposit account. If a 

depository institution or dealer is 

submitting your bids for securities to be 

held in Legacy Treasury Direct, payment 

may be either by debit entry to a deposit 

account or by allowing us to charge the 

Federal Reserve Bank funds account of 

a depository institution. 

(2) Bidding and payment by paper 

form. If you are mailing bids to us on 

a paper form, you may either enclose 

your payment with the form or pay for 

any securities awarded to you by debit 

entry to a deposit account. For bills, you 

may pay by depository institution 

(cashier’s or teller’s) check, certified 

check, or currently dated Treasury or 

fiscal agency check made payable to 

you. For notes or bonds, in addition to 

the payment options for bills, you may 

also pay by personal check. If you 

submit a personal check, make it 

payable to Legacy Treasury Direct and 

mail it with the bid to the Federal 

Reserve Bank handling your account. In 

your payment amount you must include 

the par amount and any announced 

accrued interest and/or inflation 

adjustment. 

(3) Payment by maturing securities. 

You may use maturing securities held in 

Legacy Treasury Direct as payment for 

reinvestments into new securities that 

we are offering, as long as we receive 

the appropriate transaction request on 

time. 

(d) Commercial book-entry system. 

Unless you make other provisions, 

payment of the settlement amount must 

be by charge to the funds account of a 

depository institution at a Federal 

Reserve Bank. 

■ 9. Section 356.22 is amended by 

revising paragraph (a) to read as follows: 

§ 356.22 Does the Treasury have any 

limitations on auction awards? 

(a) Awards to noncompetitive bidders. 

The maximum award to any 

noncompetitive bidder is $5 million. 

This limit does not apply to bidders 

bidding solely through TreasuryDirect 

or Legacy Treasury Direct reinvestment 

requests. 

* * * * * 

■ 10. Section 356.25 is amended by 

revising paragraphs (a) and (b), 

redesignating paragraph (c) as paragraph 

(d), adding a new paragraph (c), and 

revising newly redesignated paragraph 

(d) to read as follows: 

Federal Register / Vol. 70, No. 189 / Friday, September 30, 2005 / Rules and Regulations 57441 

§ 356.25 How does the settlement process 

work? 

* * * * * 

(a) Payment by debit entry to a deposit 

account. If you are paying by debit entry 

to a deposit account as provided for in 

§ 356.17 (b) and (c), we will charge the 

settlement amount to the specified 

account on the issue date. 

(b) Payment by authorized charge to 

a funds account. Where the submitter’s 

method of payment is an authorized 

charge to the funds account of a 

depository institution as provided for in 

§ 356.17 (c)(1) and (d), we will charge 

the settlement amount to the specified 

funds account on the issue date. 

(c) Payment through a certificate of 

indebtedness. If you are paying with the 

redemption proceeds of your certificate 

of indebtedness as provided for in 

§ 356.17(b), we will redeem the 

certificate of indebtedness for the 

settlement amount of the security and 

apply the proceeds on the issue date. 

(d) Payment with bids. If you paid the 

par amount with your bids as provided 

for in § 356.17 (c)(2), you may have to 

pay an additional amount, or we may 

have to pay an amount to you, as 

follows: 

(1) When we owe an amount to you. 

If the amount you paid is more than the 

settlement amount, we will refund the 

balance to you after the auction. This 

will generally occur if you submit 

payment with your bids. A typical 

example would be an auction where the 

price is a discount from par and there 

is no accrued interest. 

(2) When you must remit an 

additional amount. If the settlement 

amount is more than the amount you 

paid, we will notify you of the 

additional amount due. You may owe us 

such an additional amount if the 

auction calculations result in a premium 

or if accrued interest or an inflation 

adjustment is due. If your securities are 

to be held in TreasuryDirect, we will 

collect this amount through the same 

payment method that you previously 

authorized for the transaction. If your 

securities are to be held in Legacy 

Treasury Direct, you will be responsible 

for remitting this additional amount 

immediately. 

■ 11. Section 356.30 is amended by 

redesignating current paragraph (c)(2) as 

paragraph (c)(3) and by adding a new 

paragraph (c)(2) and revising newly 

redesignated paragraph (c)(3) to read as 

follows: 

§ 356.30 When does the Treasury pay 

principal and interest on securities? 

* * * * * 

(c) * * * 

(2) TreasuryDirect. We discharge our 

payment obligations when we make 

payment to a depository institution for 

credit to the account specified by the 

owner of the security, when we make 

payment for a certificate of indebtedness 

to be issued and held in the owner’s 

account, or when we make payment 

according to the instructions of the 

security’s owner or the owner’s legal 

representative. 

(3) Legacy Treasury Direct. We 

discharge our payment obligations when 

we make payment to a depository 

institution for credit to the account 

specified by the owner of the security, 

or when we make payment according to 

the instructions of the security’s owner 

or the owner’s legal representative. 

PART 357—REGULATIONS 

GOVERNING BOOK-ENTRY 

TREASURY BONDS, NOTES AND 

BILLS HELD IN LEGACY TREASURY 

DIRECT

■ 12. The authority citation for part 357 

continues to read as follows: 

Authority: 31 U.S.C. chapter 31; 12 U.S.C. 

391; 5 U.S.C. 301. 

■ 13. Amend part 357 by revising 

‘‘TreasuryDirect’’ or ‘‘Legacy Treasury 

Direct’’ to read ‘‘TreasuryDirect ’’ or 

‘‘Legacy Treasury Direct ’’ the first time 

they appear in each section or section 

heading in the part. 

■ 14. Amend 357.0 by revising 

paragraph (a) to read as follows: 

§ 357.0 Book-entry systems. 

(a) Treasury securities. Treasury 

securities are maintained in one of the 

following book-entry systems: 

(1) Commercial book-entry system. 

The commercial book-entry system is 

the book-entry system in which 

Treasury securities are held in a tiered 

system through securities intermediaries 

such as financial institutions or 

brokerage firms. A Treasury security is 

maintained in the commercial bookentry system if it is credited by a 

Federal Reserve Bank to a Participant’s 

Securities Account. The regulations 

governing the commercial book-entry 

system are found at subpart B of this 

part, and are referred to as Treasury/ 

Reserve Automated Debt Entry System 

(TRADES). 

(2) Legacy Treasury Direct. The 

Legacy Treasury Direct system is a nonInternet-based book-entry system 

maintained by Treasury for purchasing 

and holding marketable Treasury 

securities as book-entry products. A 

Treasury security is maintained in 

Legacy Treasury Direct if it is credited 

to a Legacy Treasury Direct account as 

described in § 357.20 of this part. 

Treasury securities are held directly by 

the Department of the Treasury in 

accounts maintained in the investor’s 

name. A Legacy Treasury Direct account 

may be accessed through a designated 

Federal Reserve Bank or the Bureau of 

the Public Debt. See subpart C of this 

part for rules pertaining to Legacy 

Treasury Direct. 

(3) TreasuryDirect. TreasuryDirect is a 

book-entry, online system maintained 

by the Department of the Treasury for 

purchasing and holding eligible 

marketable Treasury securities, United 

States Savings Bonds, and certificates of 

indebtedness in electronic form as a 

computer record on the books of 

Treasury. The regulations governing 

TreasuryDirect are found at 31 CFR part 

363. 

* * * * * 

■ 15. Amend § 357.2 by revising the 

definitions of ‘‘Book-entry security’’ and 

‘‘Original issue,’’ in alphabetical order, 

to read as follows: 

§ 357.2 Definitions. 

* * * * * 

Book-entry security means a Treasury 

security maintained as a computer 

record in the commercial book-entry 

system, Legacy Treasury Direct, or 

TreasuryDirect. 

* * * * * 

Original issue means Treasury’s 

offering of a marketable Treasury 

security to the public and its issuance 

in book-entry form to be maintained in 

the commercial book-entry system, 

Legacy Treasury Direct, or 

TreasuryDirect. 

* * * * * 

■ 16. Amend § 357.22 by revising the 

second sentence in paragraph (a), the 

fourth sentence in paragraph (a), the 

first sentence of paragraph (a)(1), and 

paragraph (a)(3) to read as follows: 

§ 357.22 Transfers. 

(a) General. * * * A security may be 

transferred among accounts in Legacy 

Treasury Direct, the commercial bookentry system, and TreasuryDirect. * * * 

The Department may delay transfer of a 

newly purchased security from a Legacy 

Treasury Direct account to an account in 

commercial book entry or 

TreasuryDirect for a period not to 

exceed (30) calendar days from the date 

of issue. 

(1) Identification of securities to be 

transferred. The owner must identify 

the securities to be transferred, in the 

manner required by the transaction 

request. * * * 

* * * * * 

(3) When transfer effective. 

57442 Federal Register / Vol. 70, No. 189 / Friday, September 30, 2005 / Rules and Regulations 

(i) Transfer within Legacy Treasury 

Direct or to Legacy Treasury Direct from 

the commercial book-entry system or 

TreasuryDirect. A transfer of a security 

within Legacy Treasury Direct, or to 

Legacy Treasury Direct from another 

book-entry system, is effective when an 

appropriate entry is made in the name 

of the transferee on the Legacy Treasury 

Direct records. 

(ii) Transfer from Legacy Treasury 

Direct to the commercial book-entry 

system. A transfer of a security from 

Legacy Treasury Direct to the 

commercial book-entry system is 

effective as provided in Subpart B. If a 

transfer cannot be completed, and the 

security is sent back to Legacy Treasury 

Direct, the Department will redeposit 

the security in the original account. 

(iii) Transfer from Legacy Treasury 

Direct to TreasuryDirect. A transfer of a 

security from Legacy Treasury Direct to 

TreasuryDirect is effective as provided 

in 31 CFR part 363. If the transfer 

cannot be completed, the Department 

will redeposit the security in the 

original account. 

* * * * * 

PART 363—REGULATIONS 

GOVERNING SECURITIES HELD IN 

TREASURYDIRECT 

■ 17. The authority citation for part 363 

continues to read as follows: 

Authority: 5 U.S.C. 301; 12 U.S.C. 391; 31 

U.S.C. 3102, et seq.; 31 U.S.C. 3121, et seq. 

■ 18. Amend part 363 by revising 

‘‘TreasuryDirect’’ or ‘‘Legacy Treasury 

Direct’’ to read ‘‘TreasuryDirect’’ or 

‘‘Legacy Treasury Direct’’ the first time 

they appear in each section or section 

heading in the part. 

§ 363.3 [Removed and reserved] 

■ 19. Remove and reserve § 363.3. 

■ 20. Revise § 363.4 to read as follows: 

§ 363.4 How is TreasuryDirect different 

from the Legacy Treasury Direct system 

and the commercial book-entry system? 

(a) TreasuryDirect. TreasuryDirect is a 

book-entry, online system maintained 

by Treasury for purchasing, holding and 

conducting permitted transactions in 

eligible Treasury securities in electronic 

form as a computer record on the books 

of Treasury. TreasuryDirect currently 

provides for the purchase and holding 

of eligible book-entry savings bonds, 

certificates of indebtedness, and eligible 

marketable Treasury securities. 

(b) Legacy Treasury Direct. The 

Legacy Treasury Direct system is a nonInternet-based book-entry system 

maintained by Treasury for purchasing, 

holding, and conducting permitted 

transactions in eligible marketable 

Treasury securities as book-entry 

products. The terms and conditions for 

the Legacy Treasury Direct system are 

found at 31 CFR part 357, subpart C. 

(c) Commercial book-entry system. 

The commercial book-entry system is 

the book-entry system in which 

Treasury securities are held in a tiered 

system through securities intermediaries 

such as financial institutions or 

brokerage firms. The regulations 

governing the commercial book-entry 

system are found at 31 CFR part 357, 

subpart B, and may be referred to in that 

part as Treasury/Reserve Automated 

Debt Entry System (TRADES). 

■ 21. Amend § 363.5 by redesignating 

paragraphs (a) and (b) as paragraphs (b) 

and (c), adding paragraph (a), and 

revising the newly redesignated 

paragraph (c), to read as follows: 

§ 363.5 How do I contact Public Debt? 

(a) You may use the ‘‘Contact Us’’

feature within TreasuryDirect to 

communicate information to us over a 

secure Internet connection. 

* * * * * 

(c) Letters should be addressed to: 

Bureau of the Public Debt, 

TreasuryDirect, P.O. Box 5312, 

Parkersburg, WV 26106–5312. 

■ 22. Amend § 363.6 by removing the 

definition of ‘‘Depository financial 

institution,’’ adding the definitions of 

‘‘Commercial book-entry system,’’

‘‘Financial institution,’’ ‘‘Legacy 

Treasury Direct system,’’ ‘‘Marketable 

Treasury security,’’ ‘‘Sell Direct,’’ and 

‘‘Tender’’ in alphabetical order and 

revising the definition of ‘‘Certificate of 

Indebtedness’’ and ‘‘Transfer,’’ to read 

as follows: 

§ 363.6 What special terms do I need to 

know to understand this part? 

* * * * * 

Certificate of Indebtedness is a oneday non-interest-bearing security held 

within your primary or linked account, 

including a minor account for which 

you are the custodian, that 

automatically matures and is rolled over 

each day until you request that it be 

redeemed. 

Commercial book-entry system refers 

to the book-entry system in which you 

hold your Treasury securities in a tiered 

system through securities intermediaries 

such as financial institutions or 

brokerage firms. (See § 363.4.) 

* * * * * 

Financial institution, or depository 

financial institution, means an entity 

described in 12 U.S.C. 461 (b)(1)(A)(i)–

(vi). 

* * * * * 

Legacy Treasury Direct system is a 

non-Internet-based book-entry system 

maintained by Treasury since 1986 for 

purchasing and holding marketable 

Treasury securities directly with 

Treasury as book-entry products. (See 

§ 363.4.) 

* * * * * 

Marketable Treasury security refers to 

a Treasury bill, note, or bond that is 

negotiable and transferable, that is, may 

be bought and sold in the secondary 

market. 

* * * * * 

Sell Direct is a service in which 

Treasury, through our agent, will sell 

your marketable Treasury security held 

in TreasuryDirect or Legacy Treasury 

Direct on the open market for a fee. 

* * * * * 

Tender means an offer, or bid, to 

purchase a marketable Treasury 

security. 

* * * * * 

Transfer is a transaction to move a 

security, or a portion of a security, from 

one account to another within 

TreasuryDirect, or to move a marketable 

Treasury security to or from a 

TreasuryDirect account and an account 

in Legacy Treasury Direct or the 

commercial book-entry system. 

* * * * * 

■ 23. Amend § 363.10 by revising the 

heading, paragraph (a)(2), and the last 

sentence of paragraph (b)(1) to read as 

follows: 

§ 363.10 What is a TreasuryDirect 

account? 

* * * * * 

(a) * * * 

(2) Gifts of savings bonds that have 

not yet been delivered; 

* * * * * 

(b) * * * 

(1) * * * You may also buy and 

deliver gift savings bonds from your 

custom account. 

* * * * * 

■ 24. Amend § 363.21 by revising the 

heading, and paragraphs (a), (b), (c), (d), 

and (e) to read as follows: 

§ 363.21 What transactions can I perform 

online through my TreasuryDirect account? 

* * * * * 

(a) You can purchase, transfer, and 

change the registration of an eligible 

Treasury security, including a transfer 

of a marketable security for a Sell Direct 

transaction; 

(b) You can redeem a savings bond; 

(c) You can deliver a gift savings bond 

to the account of the recipient; 

(d) You can grant and revoke the right 

to view an eligible security to a 

Federal Register / Vol. 70, No. 189 / Friday, September 30, 2005 / Rules and Regulations 57443 

secondary owner or beneficiary named 

on the security, if the secondary owner 

or beneficiary is a TreasuryDirect 

account owner; 

(e) You, as the primary owner, can 

grant certain transaction rights to the 

secondary owner, and you can also 

revoke those rights. The secondary 

owner can exercise those rights, 

provided they have not been revoked, if 

the secondary owner is a TreasuryDirect 

account owner; 

* * * * * 

■ 25. Amend § 363.22 by revising 

paragraph (c) to read as follows: 

§ 363.22 Who has the right to conduct 

online transactions in book-entry 

securities? 

* * * * * 

(c) Primary owner with secondary 

owner form of registration. (1) The 

primary owner can conduct any 

permitted transaction in a security held 

in the primary owner’s TreasuryDirect 

account. (See § 363.20(e)). 

(2) If the primary owner has given the 

secondary owner the right to conduct 

transactions in a security, and has not 

revoked that right, then the secondary 

owner can conduct transactions in the 

security. Transactions that may be 

conducted by the secondary owner 

include transferring a marketable 

security, including a transfer for a Sell 

Direct transaction, redeeming a savings 

bond, and changing the destination of 

interest and redemption payments for 

marketable securities. 

* * * * * 

■ 26. Amend § 363.26 by revising 

paragraph (a) and adding paragraph (c), 

to read as follows: 

§ 363.26 What is a transfer? 

(a) A transfer is a transaction to: 

(1) Move a Treasury security, or a 

portion of a Treasury security, from one 

account to another within 

TreasuryDirect ; 

(2) Move a marketable Treasury 

security to or from a TreasuryDirect 

account and an account in Legacy 

Treasury Direct or the commercial bookentry system. 

* * * * * 

(c) Gift delivery is not a transfer. A 

transfer does not include delivery of a 

gift savings bond from the donor to the 

recipient. This is referred to as a 

delivery. 

■ 27. Amend § 363.27 by: 

■ a. Redesignating paragraphs (a) 

through (f) as paragraphs (b) through (g); 

■ b. Adding a new paragraph (a) to read 

as set forth below; and 

■ c. Revising the first sentence of the 

newly redesignated paragraph (e)(2), 

and revising the newly redesignated 

paragraphs (e)(3), (e)(4), (e)(6), and 

(e)(7), to read as follows: 

§ 363.27 What do I need to know about 

accounts for minors who have not had a 

legal guardian appointed by a court? 

(a) We do not permit a minor to 

purchase securities. 

* * * * * 

(e) * * * 

(2) The custodian may redeem savings 

bonds on behalf of the minor through 

the minor’s account. * * * 

(3) The custodian may not purchase 

gift savings bonds from the minor’s 

account. 

(4) The custodian may transfer a 

security to another TreasuryDirect 

account, provided the account is a 

linked account bearing the name and 

taxpayer identification number of the 

minor. The custodian can transfer a 

marketable Treasury security to an 

account in Legacy Treasury Direct or the 

commercial book-entry system, and may 

request a Sell Direct transaction. 

* * * * * 

(6) Gift savings bonds may be 

delivered to the minor’s account. 

(7) The custodian may grant rights to 

view and conduct transactions in the 

security as may be permitted by 

§ 363.22. 

* * * * * 

■ 28. Revise §§ 363.36, 363.37, and 

363.38 to read as follows: 

§ 363.36 What securities can I purchase 

and hold in my TreasuryDirect account? 

You can purchase and hold eligible 

Treasury securities in your account. 

Eligible securities are Series EE and 

Series I savings bonds, certificates of 

indebtedness, and marketable Treasury 

securities that are available for purchase 

through the TreasuryDirect Web site. In 

addition, you can hold converted 

savings bonds and eligible marketable 

Treasury securities that have been 

transferred from the Legacy Treasury 

Direct system or the commercial bookentry system. 

§ 363.37 How do I purchase and make 

payment for eligible Treasury securities 

through my TreasuryDirect account? 

(a) Online purchase. Purchases of 

eligible Treasury securities through your 

TreasuryDirect account must be made 

online. 

(b) Payment for savings bonds and 

marketable Treasury securities. You can 

pay for eligible savings bonds and 

marketable Treasury securities by either 

a debit to your designated account at a 

United States financial institution using 

the ACH method, or by using the 

redemption proceeds of your certificate 

of indebtedness. 

(c) Payment for certificate of 

indebtedness. You can pay for a 

certificate of indebtedness by a direct 

deposit from your financial institution 

or employer to your TreasuryDirect 

account using the ACH method; by a 

debit from your designated account at a 

financial institution using the ACH 

method, but the amount of the debit is 

limited to $1000 or less; or by using the 

proceeds of maturing securities held in 

your Treasury Direct account. 

§ 363.38 What happens if my financial 

institution returns an ACH debit? 

If your designated financial 

institution returns an ACH debit, we 

reserve the right to reinitiate the debit 

at our option. We also reserve the right 

to reverse the transaction, thereby 

removing the security from your 

TreasuryDirect account. If the ACH 

return occurs after the security has been 

redeemed, transferred, or has matured 

and the proceeds paid, we reserve the 

right to reverse previously processed 

security transactions. We are not 

responsible for any fees your financial 

institution may charge relating to 

returned ACH debits. 

■ 29. Revise § 363.40 to read as follows: 

§ 363.40 How are payments of principal 

and interest made? 

(a) Payment of a savings bond that 

has reached final maturity. We will 

purchase a certificate of indebtedness in 

your TreasuryDirect account using the 

proceeds of a matured savings bond. 

(b) Payments of interest and principal 

(except a savings bond that has reached 

final maturity). (1) We provide two 

methods of receiving payments of 

principal and interest: 

(i) Payment to your account at a 

financial institution by the ACH 

method, or 

(ii) Payment to your TreasuryDirect 

account to purchase a certificate of 

indebtedness. 

(2) You may select different payment 

destinations for principal and interest 

for a marketable Treasury security. You 

may change your payment destination at 

any time, unless the security is in the 

closed book period. (See § 363.210.) 

(3) If we are unable to deliver a 

payment, we will use the payment to 

purchase a certificate of indebtedness in 

your TreasuryDirect account. 

■ 30. Amend § 363.44 by revising 

paragraph (a)(1) to read as follows: 

57444 Federal Register / Vol. 70, No. 189 / Friday, September 30, 2005 / Rules and Regulations 

§ 363.44 What happens when a 

TreasuryDirect account owner dies and the 

estate is entitled to securities held in the 

account? 

(a) Estate is being administered. (1) 

For an estate that is being administered, 

the legal representative of the estate may 

request payment of securities, if the 

securities are eligible for payment, to 

the estate or to the persons entitled, or 

may: 

(i) Request transfer of securities to the 

TreasuryDirect account of the persons 

entitled, if the securities are eligible for 

transfer; 

(ii) Request transfer of marketable 

Treasury securities to the commercial 

book-entry system; or 

(iii) Request a Sell Direct transaction. 

* * * * * 

§§ 363.80–363.81 [Removed and reserved] 

■ 31. Remove and reserve § 363.80 and 

§ 363.81. 

§ 363.82 [Redesignated] 

■ 32. Redesignate § 363.82 as § 363.101. 

§ 363.82 [Added and reserved] 

■ 32a. Add and reserve new §363.82. 

■ 33. Add § 363.100 to read as follows: 

§ 363.100 What are the rules for 

purchasing and delivering gift savings 

bonds to minors? 

(a) A TreasuryDirect account owner 

can purchase a savings bond as a gift 

with a minor as the recipient. 

(b) An account owner can deliver a 

bond purchased as a gift to a minor. The 

account owner must deliver the security 

to the minor’s linked account. Once 

delivered, the bond will be under the 

control of the custodian of the minor’s 

account. (See § 363.27.) 

■ 34. Revise the newly redesignated 

§ 363.101 to read as follows: 

§ 363.101 Can an account owner transfer a 

book-entry savings bond to a minor? 

An account owner can transfer a 

book-entry savings bond held in 

TreasuryDirect to a minor as a gift or 

pursuant to one of the specified 

exceptions in § 363.55(a). 

■ 35. Amend § 363.138 by revising 

paragraph (c) to read as follows: 

§ 363.138 How do I purchase a certificate 

of indebtedness? 

* * * * * 

(c) through the Buy Direct function 

of your TreasuryDirect account, in 

which you direct us to debit funds from 

your account at a financial institution to 

purchase a certificate of indebtedness. 

This method is limited to an amount no 

greater than $1000 per transaction. 

When you use the Buy Direct function 

to debit funds to purchase all or a 

portion of a certificate of indebtedness, 

you will not be permitted to schedule a 

redemption for cash from your 

certificate of indebtedness within five 

business days after the date of the debit 

entry; or 

* * * * * 

■ 36. Revise § 363.142 to read as 

follows: 

§ 363.142 Can I redeem my certificate of 

indebtedness for cash? 

You can redeem part or all of the 

value of your certificate of indebtedness 

at any time, with one exception: if you 

purchased all or a portion of your 

certificate of indebtedness through a 

debit using the ACH method, you may 

not schedule a redemption from your 

certificate of indebtedness within five 

business days after the date of the debit 

entry. 

■ 37. Redesignate Subpart F as Subpart 

H. 

■ 38. Redesignate § 363.200 through 

§ 363.202 as § 363.250 through 

§ 363.252. 

■ 39. Add a new subpart F to read as 

follows: 

Subpart F—Marketable Treasury Securities 

Sec. 

363.200 What Treasury securities does this 

subpart govern? 

363.201 What other regulations govern 

book-entry marketable book-entry 

Treasury bills, notes, and bonds? 

363.202 What marketable Treasury 

securities may I purchase and hold 

through my TreasuryDirect account? 

363.203 After I purchase my marketable 

Treasury security in TreasuryDirect, is 

there a period of time during which I 

may not transfer the security? 

363.204 What registrations are available for 

my marketable Treasury securities held 

in TreasuryDirect? 

363.205 How do I reinvest the proceeds of 

a maturing security held in 

TreasuryDirect? 

363.206 How can I transfer my marketable 

Treasury security into my TreasuryDirect 

account from another book-entry system? 

363.207 Can I transfer my marketable 

Treasury security from my 

TreasuryDirect account to another 

TreasuryDirect account? 

363.208 Can I transfer my marketable 

Treasury security from my 

TreasuryDirect account to an account in 

another book-entry system? 

363.209 How can I direct that my 

marketable Treasury security be sold on 

the open market (Sell Direct)? 

363.210 Is there any period of time during 

which I will be unable to process certain 

transactions regarding my security? 

363.211–363.249 [Reserved] 

Subpart F—Marketable Treasury Securities 

§ 363.200 What Treasury securities does 

this subpart govern? 

This subpart provides the rules for 

holding marketable Treasury bills, 

notes, and bonds in book-entry form in 

TreasuryDirect. 

§ 363.201 What other regulations govern 

book-entry marketable book-entry Treasury 

bills, notes, and bonds? 

(a) 31 CFR part 356 governs the sale 

and issue of marketable book-entry 

Treasury securities on or after March 1, 

1993, whether held in TreasuryDirect, 

Legacy Treasury Direct, or the 

commercial book-entry system. 

(b) 31 CFR part 357 governs holding 

marketable book-entry Treasury bills, 

notes, and bonds in the Legacy Treasury 

Direct system and in the commercial 

book-entry system. 

§ 363.202 What marketable Treasury 

securities may I purchase and hold through 

my TreasuryDirect account? 

(a) Purchase. You may purchase any 

marketable Treasury security that is 

available for purchase through the 

TreasuryDirect Web site. 

(b) Hold. You may transfer into the 

system and maintain in your 

TreasuryDirect account any eligible 

marketable book-entry Treasury bill, 

note, or bond. 

§ 363.203 After I purchase my marketable 

Treasury security in TreasuryDirect, is there 

a period of time during which I may not 

transfer the security? 

Once you purchase a marketable 

Treasury security in TreasuryDirect, you 

may not transfer that security for a 

period of 45 calendar days after the 

issue date of the security, or the term of 

the security, whichever is less. 

§ 363.204 What registrations are available 

for my marketable Treasury securities held 

in TreasuryDirect? 

You may register your marketable 

Treasury securities in any form of 

registration permitted by § 363.20 of this 

part. 

§ 363.205 How do I reinvest the proceeds 

of a maturing security held in 

TreasuryDirect? 

You can reinvest the proceeds of a 

maturing security held in 

TreasuryDirect by first directing that the 

proceeds from the maturing security be 

used to purchase a certificate of 

indebtedness in your account, and then 

using the redemption proceeds of your 

certificate of indebtedness to purchase 

another security. Any purchase using 

the proceeds from a certificate of 

indebtedness is considered a 

reinvestment. 

Federal Register / Vol. 70, No. 189 / Friday, September 30, 2005 / Rules and Regulations 57445 

§ 363.206 How can I transfer my 

marketable Treasury security into my 

TreasuryDirect account from another bookentry system? 

(a) Legacy Treasury Direct to 

TreasuryDirect. 31 CFR part 357, 

subpart C, governs the transfer of a 

marketable book-entry Treasury security 

from your Legacy Treasury Direct 

account into TreasuryDirect. 

(b) Commercial book-entry system to 

TreasuryDirect. You may transfer your 

marketable Treasury security from the 

commercial book-entry system by 

contacting the financial institution or 

broker that handles your commercial 

book-entry account. 

(c) Form of registration upon transfer 

to TreasuryDirect. When your security is 

transferred into your TreasuryDirect 

account, it will be transferred into your 

account in your name in the sole owner 

form of registration, regardless of the 

form of registration prior to the transfer. 

After the transfer is completed, you can 

change the registration to any form of 

registration permitted by § 363.20. 

(d) Amounts transferred. You can 

only transfer in increments of $1000. 

§ 363.207 Can I transfer my marketable 

Treasury security from my TreasuryDirect 

account to another TreasuryDirect 

account? 

After the initial 45-calendar day 

holding period for your marketable 

Treasury security (see § 363.203) you 

can transfer your security to another 

TreasuryDirect account in increments of 

$1000. 

§ 363.208 Can I transfer my marketable 

Treasury security from my TreasuryDirect 

account to an account in another bookentry system? 

After the initial 45-calendar day 

holding period for your marketable 

Treasury security (see § 363.203) you 

can transfer your security to an account 

in Legacy Treasury Direct or to an 

account in the commercial book-entry 

system in increments of $1000. 

§ 363.209 How can I direct that my 

marketable Treasury security be sold on the 

open market (Sell Direct)? 

(a) Sell Direct. We offer a service, 

referred to as Sell Direct, in which we 

will sell your marketable Treasury 

security for you on the open market at 

your request. We will transfer your 

security to an account in the 

commercial book-entry system 

maintained by our agent, and will sell 

the security on your behalf. By 

authorizing the transfer and sale of the 

security, you agree to accept the price 

received by our agent. If our agent is 

unable to obtain at least one price quote 

for the security, the security will be 

returned to your TreasuryDirect 

account. 

(b) Fee. We charge a fee for each 

security sold on your behalf. By 

authorizing the sale of the security, you 

authorize our agent to deduct the fee 

from the proceeds of the sale. If our 

agent is unable to complete the sale, no 

fee will be charged. The amount of the 

fee is published in the Federal Register. 

(c) Definitions. The following 

definitions will help you understand 

this section and the confirmation that 

you will receive after the sale is 

completed. 

(1) The trade date is the date that your 

security is sold. 

(2) A security, for the purpose of this 

section, is any amount represented by a 

separate CUSIP number (see definition 

of CUSIP in 31 CFR part 356). 

(3) The settlement date is the date that 

the proceeds of the sale are released to 

the financial institution that you 

designated to receive the proceeds. 

(4) The yield to maturity, or yield, is 

the annualized rate of return to maturity 

on a fixed principal security expressed 

as a percentage. For an inflationindexed security, yield means real yield, 

as defined in 31 CFR part 356. 

(d) On the settlement date, our agent 

will release the settlement proceeds, 

less the fee, to the account at the 

financial institution that you 

designated. 

(e) When the transaction is complete, 

our agent will send you a confirmation. 

The confirmation will include the price, 

trade date, settlement date, settlement 

amount or net amount, transaction fee, 

and yield to maturity. 

(f) We are not liable for changes in 

market conditions affecting the price 

received for the security, or for any loss 

that you may incur as a result of the sale 

or the inability of our agent to complete 

the sale. 

(g) We reserve the right to terminate 

the Sell Direct service at any time. 

§ 363.210 Is there any period of time 

during which I will be unable to process 

certain transactions regarding my security? 

A closed book period will be in effect 

for four business days prior to the date 

a marketable security interest or 

redemption payment is made. This 

means that certain transactions made 

during the closed book period will be 

delayed until after the closed book 

period is completed and the payment is 

made. You will be unable to transfer the 

security, change the payment 

destination, change the registration of 

the security, or use Treasury’s Sell 

Direct service during this closed book 

period. 

§§ 363.211–363.249 [Added and reserved] 

■ 40. Add and reserve §§363.211 

through 363.249 in subpart F. 

Subpart G—[Added and reserved] 

■ 41. Add and reserve Subpart G. 

Dated: September 26, 2005. 

Donald V. Hammond, 

Fiscal Assistant Secretary. 

[FR Doc. 05–19552 Filed 9–27–05; 12:41 pm] 

BILLING CODE 4810–39–P