Document ID: SEC-2009-0107-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: National Securities Clearing Corp.
Posted Date: 2009-01-26T05:00Z

[Federal Register: January 26, 2009 (Volume 74, Number 15)]
[Notices]               
[Page 4495-4496]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26ja09-134]                         

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59252; File No. SR-NSCC-2008-10]

 
Self-Regulatory Organizations; National Securities Clearing 
Corporation; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change Relating to an Enhancement to Its Insurance and Retirement 
Services To Allow for the Electronic Exchange of Attachments to 
Messages

January 15, 2009.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on November 24, 2008, 
National Securities Clearing Corporation (``NSCC'') filed with the 
Securities and Exchange Commission (``Commission'') the proposed rule 
change described in Items I, II, and III below, which items have been 
prepared primarily by NSCC. NSCC filed the proposed rule change 
pursuant to Section 19(b)(3)(A)(iii) of the Act \2\ and Rule 19b-
4(f)(4) thereunder \3\ 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 parties.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \3\ 17 CFR 240.19b-4(f)(4).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The proposed rule change is an enhancement to NSCC's insurance and 
retirement services (``IPS'') called ``Attachments.''

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 these 
statements.\4\
---------------------------------------------------------------------------

    \4\ The Commission has modified the text of the summaries 
prepared by NSCC.
---------------------------------------------------------------------------

(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 enhance the IPS to 
allow for the electronic exchange of attachments to IPS messages, such 
as imaged data in PDF format. The enhancement is referred to as 
``Attachments.'' The attachment may be any collection of data that is 
unstructured and is intended to pass through the network from sender to 
receiver without edit. The attachment data may but need not be in 
support of an existing IPS service message.
Background
    Recent regulatory developments have highlighted a need for the 
annuity and insurance industry to have the capability of an electronic 
exchange of imaged documents, signatures, and forms during the presale, 
new business, and post-issue process. Industry standards developed by 
the industry through the straight-through processing (``STP'') 
initiative led by the National Association of Variable Annuities 
(``NAVA'') state that signature capture, either through e-signature or 
on imaged copies of forms, is required at point of sale. The signature 
and the associated documentation must be transmitted by the selling 
broker-dealer agent to the insurance carrier for the annuity to be 
processed ``in-good-order.''
    NSCC's Attachments service is in furtherance of the NAVA STP 
initiative. It will eliminate the need for a paper exchange of 
information in paper form and will enable STP when signatures are 
required at point of sale or when original documentation is required in 
connection with processing what is otherwise automated. Additionally, 
industry participants will realize savings from reduced mailing costs 
and from the processing efficiencies associated with expedited document 
processing. Automation of this process will also create an improved 
audit trail and will eliminate problems associated with lost paperwork.
    The proposed rule change will promote processing efficiencies 
between insurance companies and distributors of variable insurance 
products thereby facilitating the prompt and accurate processing of 
securities transactions, which is consistent with the requirements of 
the Act and the rules and regulations promulgated thereunder applicable 
to NSCC.

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

    NSCC 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 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 upon filing pursuant 
to Section 19(b)(3)(A)(iii) of the Act \5\ and Rule 19b-4(f)(4) \6\ 
thereunder because the proposed rule effects a change in an existing 
service of NSCC that (i) does not adversely affect the safeguarding of 
securities or funds in the custody or control of NSCC or for which it 
is responsible and (ii) 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 such 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.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \6\ 17 CFR 240.19b-4(f)(4).
---------------------------------------------------------------------------

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-2008-10 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary,

[[Page 4496]]

Securities and Exchange Commission, 100 F Street, NE., Washington, DC 
20549-1090.

All submissions should refer to File Number SR-NSCC-2008-10. 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. The text of the proposed rule change is available at 
NSCC, the Commission's Public Reference Room, and http://www.dtcc.com/
downloads/legal/rule_filings/2008/nscc/2008-10.pdf. 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-2008-10 and should be 
submitted on or before February 17, 2009.

    For the Commission by the Division of Trading and Markets, 
pursuant to delegated authority.\7\
---------------------------------------------------------------------------

    \7\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-1571 Filed 1-23-09; 8:45 am]

BILLING CODE 8011-01-P