Document ID: SEC-2007-1032-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: National Securities Clearing Corp.
Posted Date: 2007-08-01T04:00Z

[Federal Register: August 1, 2007 (Volume 72, Number 147)]
[Notices]               
[Page 42192-42193]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01au07-132]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56125; File No. SR-NSCC-2007-09]

 
Self-Regulatory Organizations; The National Securities Clearing 
Corporation; Notice of Filing and Immediate Effectiveness of a Proposed 
Rule Change Relating to Use of the National Settlement Service

July 24, 2007.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on May 1, 2007, The National 
Securities Clearing Corporation (``NSCC'') 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 NSCC. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The proposed rule change permits NSCC to use the Federal Reserve 
Bank's National Settlement Service (``NSS'') for the settlement of net-
net credit balances.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, NSCC 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. NSCC has prepared summaries, set forth in sections (A), 
(B), and (C) below, of the most significant aspects of such 
statements.\2\
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    \2\ The Commission has modified parts of these statements.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In 2003, as part of a larger initiative to create a centralized 
settlement system with its affiliate, The Depository Trust Company 
(``DTC''), NSCC required the use of NSS as the vehicle for all Settling 
Banks to satisfy their end of day net-net debits.\3\ In an effort to 
increase the efficiencies afforded by NSS, NSCC in conjunction with DTC 
is now modifying its rules to permit NSCC's use of NSS to distribute 
net-net credits.\4\ Utilizing NSS as the payment mechanism for net-net 
credits will eliminate the need for NSCC to initiate wire payments for 
settlement monies owed by NSCC. However, should NSS not be available 
for any reason, NSCC will retain the capability to satisfy its 
settlement obligations using wire transfer.
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    \3\ Securities Exchange Act Release No. 48744 (November 10, 
2003), 68 FR 63831 (November 4, 2003) (File Nos. SR-NSCC-2003-19 and 
SR-DTC-2003-11).
    \4\ DTC has submitted a similar proposed rule change (File No. 
SR-DTC-2007-08) providing for the use of NSS for the distribution of 
net credits.
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    The proposed rule change is consistent with the requirements of 
section 17A of the Act and the rules and regulations thereunder because 
it will not affect the safeguarding of funds or securities in NSCC's 
custody and control or for which it is responsible.

(B) Self-Regulatory Organization's Statement on Burden on Competition

    NSCC does not believe that the proposed rule change would 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 relating to the proposed rule change have not yet 
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)(iii) of the Act \5\ and Rule 19b-4(f)(4) \6\ promulgated 
thereunder because the proposal effects a change in an existing service 
of NSCC that (A) does not adversely affect the safeguarding of 
securities or funds in the custody or control of NSCC or for which it 
is responsible and (B) does not significantly affect the respective 
rights or obligations of NSCC or persons using the service. At any time 
within sixty days of the filing of the proposed rule change, the 
Commission could have summarily abrogated such rule change if it 
appeared to the Commission that such action was necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act.
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    \5\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \6\ 17 CFR 240.19b-4(f)(4).
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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 rule-comments@sec.gov. Please include 

File Number SR-NSCC-2007-09 on the subject line.

[[Page 42193]]

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NSCC-2007-09. 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 NSCC. 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-NSCC-2007-09 and should be 
submitted on or before August 22, 2007.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-14835 Filed 7-31-07; 8:45 am]

BILLING CODE 8010-01-P