59694 Federal Register / Vol. 73, No. 197 / Thursday, October 9, 2008 / Notices 

13 17 CFR 200.30–3(a)(12). 

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

2The Commission has modified parts of these 

statements. 

3Securities Exchange Act Release No. 48007 

(June 10, 2003), 68 FR 35744 (June 16, 2003) (File 

No. SR–DTC–2003–07). 

4Securities Exchange Act Release No. 50182 

(August 11, 2004), 69 FR 51341 (August 18, 2004) 

(File No. SR–DTC–2004–05). 

5Net debit caps help ensure that DTC can 

complete settlement, even if a Participant fails to 

settle. 

6Before completing a transaction in which a 

Participant is the receiver, DTC calculates the 

resulting effect the transaction would have on the 

Participant’s account and determines whether the 

resulting net balance would exceed the Participant’s 

net debit cap. Any transaction that would cause the 

Participant’s net settlement debit to exceed its net 

debit cap is placed in a pending (recycling) queue 

until another transaction creates credits in the 

Participant’s account. 

7For example, Participant A is delivering shares 

to Participant B and Participant B has a delivery 

obligation of shares with the same CUSIP to 

Participant C. 

8ATP is the core processing system for all 

transaction activity affecting security positions held 

at DTC. 

9 DTC tracks collateral in a Participant’s account 

through its Collateral Monitor (‘‘CM’’). At all times, 

the CM reflects the amount by which the collateral 

in the account exceeds the net debit in the account. 

When processing a transaction, DTC verifies that 

the deliverer’s and receiver’s CMs will not become 

negative when the transaction completes. If the 

transaction would cause either party to have a 

negative CM, the transaction will recycle until the 

deficient account has sufficient collateral for the 

transaction to complete. 

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 

Room, 100 F Street, NE., Washington, 

DC 20549, on official business days 

between the hours of 10 a.m. and 3 p.m. 

Copies of the filing will also be available 

for inspection and copying at the 

principal office of the self-regulatory 

organization. All comments received 

will be posted without change; the 

Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submissions 

should refer to File Number SR–CBOE– 

2008–103 and should be submitted on 

or before October 30, 2008. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E8–23927 Filed 10–8–08; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–58730; File No. SR–DTC– 

2008–09] 

Self-Regulatory Organizations; The 

Depository Trust Company; Notice of 

Filing of a Proposed Rule Change To 

Expand DTC’s Debit Cap Look-Ahead 

Processing 

October 3, 2008. 

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

Securities Exchange Act of 1934 

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

September 12, 2007, The Depository 

Trust Company (‘‘DTC’’) 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 DTC. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The proposed rule change would 

amend the Look-Ahead Process in 

DTC’s Settlement Services Guide to 

allow Money Market Issuance Deliveries 

pending for a Custodian’s or Dealer’s net 

debit cap to complete against Maturity 

Presentments pending for an Issuing/ 

Paying Agent’s net debit cap. DTC’s 

processing system would calculate the 

net effect of the dollar amount of 

offsetting transactions in the accounts of 

the two Participants involved. If the net 

of the transactions would result in 

positive risk management controls in 

those two accounts, the transactions 

would be completed. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

DTC 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. DTC 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 

On June 10, 2003, the Commission 

approved a proposed rule change to 

establish a transaction Look-Ahead 

Process which became available for 

municipal and corporate bonds, 

including Money Market Instruments 

(‘‘MMIs’’).3 On August 11, 2004, the 

Commission approved another proposed 

rule change which expanded the 

application and extended the benefit of 

the Look-Ahead Process to all equity 

transactions.4 With this proposed rule 

change, DTC is proposing to expand the 

Look-Ahead Process to MMIs. 

The purpose of DTC’s Look-Ahead 

Process is to reduce the number of 

recycling transactions in the system 

caused by the Net Debit Cap Risk 

Management Control.5 The existing 

Look-Ahead Process finds delivery 

transactions that are pending because 

the Receiving Participant has reached its 

net debit cap.6 It then looks to see 

whether the Receiving Participant has a 

pending delivery for the same security 

to another Participant.7 In such a 

situation, DTC’s Account Transaction 

Processor (‘‘ATP’’) 8 will calculate the 

net effect to the collateral 9 and net debit 

cap controls for all three Participants 

involved. If the net effect will not result 

in a deficit in the collateral or net debit 

cap controls for any of the three 

Participants, ATP processes the 

transactions simultaneously. Without 

the Look-Ahead Process, the transaction 

would pend in DTC’s system until 

another transaction created sufficient 

credit in the Receiving Participant’s 

account. Most credits are generated 

when a Participant delivers securities 

versus payment, pledges securities for 

value, receives principal, dividend or 

other interest allocations, or wires funds 

(a Settlement Progress Payment (‘‘SPP’’)) 

to DTC’s account at the Federal Reserve 

Bank of New York in order to reduce its 

DTC net debit. 

In order to further reduce the number 

of recycling transactions in the system 

and to improve the timeliness and 

certainty of transactions completing, 

DTC is proposing to expand the LookAhead Process beyond same securities 

for MMIs to allow pairs of money 

market instrument transactions between 

two Participants (i.e., an Issuing Paying 

Agent [’’IPA’’] and a custodian or 

dealer) that are pending for both party’s 

net debit caps to complete. This 

situation occurs when an IPA has a 

delivery of a new money market 

instrument to a custodian or a dealer for 

X dollars and that same custodian or 

dealer has a maturity of a money market 

instrument of equal or greater value 

awaiting acceptance by the same IPA. 

The proposed rule change would allow 

ATP to process those transactions 

simultaneously, as long as neither 

Participant’s risk management controls 

were overridden. 


sroberts on PROD1PC70 with NOTICES
Federal Register / Vol. 73, No. 197 / Thursday, October 9, 2008 / Notices 59695 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(1). 

4 17 CFR 240.19b–4. 

5For purposes of this proposal, order entry 

mnemonics are codes that identify member 

organization order entry ports. Member 

organizations send order flow to the Exchange via 

these order entry ports. A member organization may 

have more than one order entry port. To clarify, 

order entry mnemonics would not include those 

mnemonics entered through internal Exchange 

applications, such as the Floor Broker Management 

System, because the proposed fee is intended to 

help cover the costs of establishing and maintaining 

connectivity to the Exchange through external order 

entry ports. (See Exchange Rule 1063). 

This enhancement to the Look-Ahead 

Process will reduce the number of MMI 

recycling transactions. The Look-Ahead 

enhancement to DTC’s processing 

system will not result in any systematic 

changes for Participants. 

The proposed rule change is 

consistent with the requirements of the 

Act and the rules and regulations 

thereunder applicable to DTC in that the 

proposed rule change will promote the 

prompt and accurate clearance and 

settlement of securities transactions 

because it will allow transactions to 

settle through a Look-Ahead Process 

and as such will allow MMI transactions 

to clear and settle in a more prompt and 

efficient manner. The proposed rule 

change will be implemented in a 

manner that is consistent with DTC’s 

risk management controls. 

(B) Self-Regulatory Organization’s 

Statement on Burden on Competition 

DTC does not believe that the 

proposed rule change will have any 

impact, or impose any burden, on 

competition. 

(C) Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments from relating to the 

proposed rule change have not yet been 

solicited or received. DTC will notify 

the Commission of any written 

comments received by DTC. 

III. Date of Effectiveness of the 

Proposed Rule Change 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 the self-regulatory 

organization consents, the Commission 

will: 

(a) By order approve the proposed 

rule change or 

(b) Institute proceedings to determine 

whether the proposed rule change 

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 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–DTC–2008–09 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–DTC–2008–09. This file 

number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/ 

rules/sro.shtml). 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 

Room, 100 F Street, NE., Washington, 

DC 20549, on official business days 

between the hours of 10 a.m. and 3 p.m. 

Copies of such filing also will be 

available for inspection and copying at 

the principal office of DTC. All 

comments received will be posted 

without change; the Commission does 

not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. All 

submissions should refer to File 

Number SR–DTC–2008–09 and should 

be submitted on or before October 30, 

2008. 

For the Commission by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E8–23979 Filed 10–8–08; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–58728; File No. SR–Phlx– 

2008–70] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change by the 

NASDAQ OMX PHLX, Inc. Relating to 

an Order Entry Port Fee 

October 3, 2008. 

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

Securities Exchange Act of 1934 

(‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on 

September 24, 2008, the Philadelphia 

Stock Exchange, Inc. (‘‘Phlx’’ or 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission (‘‘SEC’’ or 

‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III, below, which Items have been 

prepared by the Phlx. The Commission 

is publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange, pursuant to Section 

19(b)(1) of the Act 3 and Rule 19b–4 

thereunder,4 proposes to adopt a 

monthly order entry port fee of $250 

assessed per member organization order 

entry mnemonic.5

While changes to the Exchange’s fee 

schedule pursuant to this proposal are 

effective upon filing, the Exchange has 

designated the proposed monthly $250 

order entry port fee to be implemented 

beginning October 1, 2008. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http://www.phlx.com/regulatory/ 

reg_rulefilings.aspx. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 


sroberts on PROD1PC70 with NOTICES