Document ID: SEC-2006-1377-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: Fixed Income Clearing Corp.
Posted Date: 2006-10-25T04:00Z

[Federal Register: October 25, 2006 (Volume 71, Number 206)]
[Notices]               
[Page 62497-62498]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr25oc06-102]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-54619; File No. SR-FICC-2006-07]

 
Self-Regulatory Organizations; Fixed Income Clearing Corporation; 
Notice of Filing of a Proposed Rule Change Relating To Providing 
Certain Reports to its Members

October 18, 2006.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on April 21, 2006, the Fixed 
Income Clearing Corporation (``FICC'') filed with the Securities and 
Exchange Commission (``Commission'') and on June 2, 2006, amended the 
proposed rule change as described in Items I, II, and III below, which 
Items have been prepared primarily by FICC. 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 would clarify the frequency of certain 
reports that FICC will provide to its members.

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

    In its filing with the Commission, FICC 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. FICC 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 the text of the summaries 
prepared by FICC.
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A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    The purpose of the proposed rule change is to further harmonize the 
rules of The Depository Trust & Clearing Corporation's clearing agency 
subsidiaries. In this filing, FICC proposes to conform the rules of 
both its divisions, the Government Securities Division and the Mortgage 
Backed Securities Division (``MBSD''), regarding providing FICC's 
financial reports to members to the equivalent rule of The Depository 
Trust Company (``DTC'').\3\ The revised rules would state that 
quarterly unaudited financial statements would only be provided to 
members for the first three quarters of the calendar year.\4\ In 
addition, although FICC would delete the time frames for providing the 
financial reports from its rules (in conformity to DTC's rule), FICC 
would nevertheless continue to make its annual audited financial 
statements available to its members within 60 days of the fiscal year 
end and would continue to make its quarterly unaudited financial 
statements available within 30 days of the quarter end.\5\
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    \3\ DTC Rule 15.
    \4\ An annual audited financial statement is provided to members 
after the last calendar quarter of each year.
    \5\ FICC will post the information on its website within the 
requisite time frames.
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    FICC also proposes to change the time frame in Article V, Rule 5, 
Section 3 of MBSD's Clearing Rulebook and EPN Rulebook regarding its 
providing to its members with the independent auditors' annual study 
and evaluation of MBSD's internal accounting controls. While FICC 
proposes to delete these rule provisions in their entirety, FICC would 
make this study and evaluation available to its members within a 
reasonable time after it receives it from its independent accountants, 
which is exactly the practice for DTC.
    FICC believes that the proposed rule change is consistent with the 
requirements of Section 17A of the Act \6\ and the rules and 
regulations thereunder because it is a change that does not adversely 
affect the safeguarding of securities or funds in the custody or 
control of FICC or for which it is responsible.
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    \6\ 15 U.S.C. 78q-1.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    FICC 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

    FICC has not solicited or received written comments relating to the 
proposed rule change. FICC will notify the Commission of any written 
comments it receives.

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 such 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, as amended, 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 No. SR-FICC-2006-07 on the subject line.

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 No. SR-FICC-2006-07. 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/

[[Page 62498]]

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 Section, 100 F Street, 
NE., Washington, DC 20549. Copies of such filing also will be available 
for inspection and copying at FICC's principal office and on FICC's Web 
site at http://www.ficc.com/gov/gov.docs. jsp?NS-query=. 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 
submission should refer to File No. SR-FICC-2006-07 and should be 
submitted on or before November 15, 2006.
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    \7\ 17 CFR 200.30-3(a)(12).

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\7\
J. Lynn Taylor,
Assistant Secretary.
 [FR Doc. E6-17837 Filed 10-24-06; 8:45 am]

BILLING CODE 8011-01-P