Document ID: SEC-2006-1179-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: Depository Trust Co.
Posted Date: 2006-09-13T04:00Z

[Federal Register: September 13, 2006 (Volume 71, Number 177)]
[Notices]               
[Page 54104-54105]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr13se06-128]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-54408; File No. SR-DTC-2006-12]

 
Self-Regulatory Organizations; The Depository Trust Company; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
Relating to the LENS Service

September 6, 2006.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on July 28, 2006, 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. DTC filed the proposed rule change pursuant to 
Section 19(b)(3)(A) of the Act \2\ and Rule 19b-4(f)(4) \3\ thereunder 
so that the proposal was effective upon filing with the Commission. 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).
    \2\ 15 U.S.C. 78s(b)(3)(A).
    \3\ 17 CFR 240.19b-4(f)(4).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The proposed rule change will discontinue the posting of Asset-
Backed Security notices on DTC's LENS system.

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.\4\
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    \4\ The Commission has modified the text of the summaries 
prepared by DTC.
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A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In 1991, DTC created the LENS service to reduce the amount of paper 
that participants received in connection with DTC's distribution of 
legal and other notices. Participants consequently could access such 
notices through DTC's proprietary PTS 3270 terminal network.\5\ In 
2000, DTC enhanced this process by making the LENS service available 
over the Internet.\6\ Benefits of the LENS service include: (a) 
Reducing distribution costs that are born by participants and (b) 
allowing for other enhancements relating to notice distribution, 
including: (i) The identification of CUSIP numbers, (ii) participants' 
ability to search by CUSIP, (iii) participant access to a computer 
record of past notices with automatic order capability, and (iv) 
equitable billing (e.g. a participant only pays for those notices that 
it orders).
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    \5\ Securities Exchange Act Release No. 29291 (June 12, 1991), 
56 FR 28190 (June 19, 1991) [File No. SR-DTC-91-08].
    \6\ Securities Exchange Act Release No. 34-43964 (Feb. 14, 
2001), 66 FR 1190 (Feb. 22, 2001) [File No. SR-DTC-2000-18].
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    Recently, DTC has studied whether additional enhancements and 
efficiencies can be brought to the LENS service in terms of the value 
to participants of the information provided them through LENS and the 
associated costs. As part of this process, DTC reviewed a current 
practice relating to the posting of Asset-Backed Security (``ABS'') 
notices on LENS.\7\ Such ABS notices are now generally available over 
the Internet on the agents' Web sites and have been retrieved by DTC 
and posted on LENS at considerable expense. In light of the 
accessibility of ABS notices from other sources and the expense 
incurred by DTC in retrieving the information, DTC consulted with many 
of the participants with current subscriptions to the ABS portion of 
LENS and learned that DTC's posting of this information on LENS is of 
limited value versus the alternative of participants being able to 
obtain much

[[Page 54105]]

of the information directly from agents' Web sites.
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    \7\ ABS notices provide investment and financial information 
specific to a respective ABS (e.g., monthly principal and interest 
factors, credit worthiness, etc.).
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    Therefore, DTC will no longer post ABS notices on LENS. DTC will 
distribute an Important Notice to its participants to notify them of 
this change to the LENS service and inform participants as to how they 
may obtain DTC's assistance in obtaining ABS information.
    DTC believes that the proposed rule change is consistent with the 
requirements of Section 17A of the Act\8\ and the rules and regulations 
thereunder because it controls costs associated with a service provided 
by DTC and therefore does not significantly affect the respective 
rights or obligations of DTC or persons using this service.
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    \8\ 15 U.S.C. 78q-1.
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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

    DTC has not solicited or received written comments relating to the 
proposed rule change.

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) of the Act\9\ and Rule 19b-4(f)(4) \10\ thereunder because 
it effects a change in an existing service of DTC that does not 
adversely affect the safeguarding of securities or funds in DTC's 
control or for which DTC is responsible and does not significantly 
affect DTC's or its participants' respective rights or obligations. At 
any time within 60 days of the filing of the proposed rule change, the 
Commission may summarily abrogate such rule change if it appears to the 
Commission that such action is 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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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 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, 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-DTC-2006-12 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-DTC-2006-12. 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 Section, 100 F Street, NE., 
Washington, DC 20549. Copies of such filing also will be available for 
inspection and copying at DTC's principal office and on DTC's Web site 
at http://www.dtc.org/impNtc/mor/index.html. 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-DTC-2006-12 and should be submitted on or 
before October 4, 2006.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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J. Lynn Taylor,
Assistant Secretary.
 [FR Doc. E6-15191 Filed 9-12-06; 8:45 am]

BILLING CODE 8010-01-P