Source: http://www.law.cornell.edu/uscode/text/15/78q-1?quicktabs_8=3
Timestamp: 2013-12-22 12:27:09
Document Index: 149179486

Matched Legal Cases: ['§ 78', '§ 78', '§ 78', '§ 17', '§ 15', '§ 322', '§ 206', '§ 5', '§ 203', '§ 1', '§ 206', '§ 604', '§ 763', '§ 925', '§ 1', '§ 925', '§ 929', '§ 763', '§ 763', '§ 1', '§ 207', '§ 1', '§ 207', '§ 1', '§ 206', '§ 1', '§ 207', '§ 5', '§ 5', '§ 322', '§ 322', '§ 322', '§ 322', '§ 761', 'art 10', 'art 19', 'art 208', 'art 308', 'art 341', 'art 200', 'art 248', 'art 249', 'art 249']

15 USC § 78q–1 - National system for clearance and settlement of securities transactions | Title 15 - Commerce and Trade | U.S. Code | LII / Legal Information Institute
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15 USC § 78q–1 - National system for clearance and settlement of securities transactions
Congressional findings; facilitating establishment of system (1)
Registration of clearing agencies; application; determinations by Commission requisite to registration of applicant as clearing agency; denial of participation; discipline; summary proceedings; exemption; facilities for handling derivatives (1)
A clearing agency may be registered under the terms and conditions hereinafter provided in this subsection and in accordance with the provisions of section 78s
(a) of this title, by filing with the Commission an application for registration in such form as the Commission, by rule, may prescribe containing the rules of the clearing agency and such other information and documents as the Commission, by rule, may prescribe as necessary or appropriate in the public interest or for the prompt and accurate clearance and settlement of securities transactions.
Such clearing agency is so organized and has the capacity to be able to facilitate the prompt and accurate clearance and settlement of securities transactions and derivative agreements, contracts, and transactions for which it is responsible, to safeguard securities and funds in its custody or control or for which it is responsible, to comply with the provisions of this chapter and the rules and regulations thereunder, to enforce (subject to any rule or order of the Commission pursuant to section 78q
(g)(2) of this title) compliance by its participants with the rules of the clearing agency, and to carry out the purposes of this section.
Subject to the provisions of paragraph (4) of this subsection, the rules of the clearing agency provide that any (i)
registered broker or dealer, (ii)
other registered clearing agency, (iii)
registered investment company, (iv)
bank, (v)
insurance company, or (vi)
other person or class of persons as the Commission, by rule, may from time to time designate as appropriate to the development of a national system for the prompt and accurate clearance and settlement of securities transactions may become a participant in such clearing agency.
The rules of the clearing agency provide that (subject to any rule or order of the Commission pursuant to section 78q
(g)(2) of this title) its participants shall be appropriately disciplined for violation of any provision of the rules of the clearing agency by expulsion, suspension, limitation of activities, functions, and operations, fine, censure, or any other fitting sanction.
A registered clearing agency may summarily suspend and close the accounts of a participant who (i)
has been and is expelled or suspended from any self-regulatory organization, (ii)
is in default of any delivery of funds or securities to the clearing agency, or (iii)
is in such financial or operating difficulty that the clearing agency determines and so notifies the appropriate regulatory agency for such participant that such suspension and closing of accounts are necessary for the protection of the clearing agency, its participants, creditors, or investors. A participant so summarily suspended shall be promptly afforded an opportunity for a hearing by the clearing agency in accordance with the provisions of subparagraph (A) of this paragraph. The appropriate regulatory agency for such participant, by order, may stay any such summary suspension on its own motion or upon application by any person aggrieved thereby, if such appropriate regulatory agency determines summarily or after notice and opportunity for hearing (which hearing may consist solely of the submission of affidavits or presentation of oral arguments) that such stay is consistent with the public interest and protection of investors.
A clearing agency that is regulated directly or indirectly by the Commodity Futures Trading Commission through its association with a designated contract market for security futures products that is a national securities exchange registered pursuant to section 78f
(g) of this title, and that would be required to register pursuant to paragraph (1) of this subsection only because it performs the functions of a clearing agency with respect to security futures products effected pursuant to the rules of the designated contract market with which such agency is associated, is exempted from the provisions of this section and the rules and regulations thereunder, except that if such a clearing agency performs the functions of a clearing agency with respect to a security futures product that is not cash settled, it must have arrangements in place with a registered clearing agency to effect the payment and delivery of the securities underlying the security futures product.
Any clearing agency that performs the functions of a clearing agency with respect to security futures products must coordinate with and develop fair and reasonable links with any and all other clearing agencies that perform the functions of a clearing agency with respect to security futures products, in order to permit, as of the compliance date (as defined in section 78f
(h)(6)(C) [1]
Registration of transfer agents (1)
Except as otherwise provided in this section, it shall be unlawful for any transfer agent, unless registered in accordance with this section, directly or indirectly, to make use of the mails or any means or instrumentality of interstate commerce to perform the function of a transfer agent with respect to any security registered under section 78l of this title or which would be required to be registered except for the exemption from registration provided by subsection (g)(2)(B) or (g)(2)(G) of that section. The appropriate regulatory agency, by rule or order, upon its own motion or upon application, may conditionally or unconditionally exempt any person or security or class of persons or securities from any provision of this section or any rule or regulation prescribed under this section, if the appropriate regulatory agency finds (A)
that such exemption is in the public interest and consistent with the protection of investors and the purposes of this section, including the prompt and accurate clearance and settlement of securities transactions and the safeguarding of securities and funds, and (B)
the Commission does not object to such exemption.
has committed or omitted any act, or is subject to an order or finding, enumerated in subparagraph (A), (D), (E), (H), or (G) of paragraph (4) of section 78o
(b) of this title, has been convicted of any offense specified in subparagraph (B) of such paragraph (4) within ten years of the commencement of the proceedings under this paragraph, or is enjoined from any action, conduct, or practice specified in subparagraph (C) of such paragraph (4); or
The appropriate regulatory agency for a transfer agent, by order, shall censure or place limitations on the activities or functions of any person associated, seeking to become associated, or, at the time of the alleged misconduct, associated or seeking to become associated with the transfer agent, or suspend for a period not exceeding 12 months or bar any such person from being associated with any transfer agent, broker, dealer, investment adviser, municipal securities dealer, municipal advisor, or nationally recognized statistical rating organization, if the appropriate regulatory agency finds, on the record after notice and opportunity for hearing, that such censure, placing of limitations, suspension, or bar is in the public interest and that such person has committed or omitted any act, or is subject to an order or finding, enumerated in subparagraph (A), (D), (E), (H), or (G) or [2]
paragraph (4) of section 78o
(b) of this title, has been convicted of any offense specified in subparagraph (B) of such paragraph (4) within ten years of the commencement of the proceedings under this paragraph, or is enjoined from any action, conduct, or practice specified in subparagraph (C) of such paragraph (4). It shall be unlawful for any person as to whom such an order suspending or barring him from being associated with a transfer agent is in effect willfully to become, or to be, associated with a transfer agent without the consent of the appropriate regulatory agency that entered the order and the appropriate regulatory agency for that transfer agent. It shall be unlawful for any transfer agent to permit such a person to become, or remain, a person associated with it without the consent of such appropriate regulatory agencies, if the transfer agent knew, or in the exercise of reasonable care should have known, of such order. The Commission may establish, by rule, procedures by which a transfer agent reasonably can determine whether a person associated or seeking to become associated with it is subject to any such order, and may require, by rule, that any transfer agent comply with such procedures.
Activities of clearing agencies and transfer agents; enforcement by appropriate regulatory agencies (1)
No registered clearing agency or registered transfer agent shall, directly or indirectly, engage in any activity as clearing agency or transfer agent in contravention of such rules and regulations (A)
as the Commission may prescribe as necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of this chapter, or (B)
as the appropriate regulatory agency for such clearing agency or transfer agent may prescribe as necessary or appropriate for the safeguarding of securities and funds.
With respect to any clearing agency or transfer agent for which the Commission is not the appropriate regulatory agency, the appropriate regulatory agency for such clearing agency or transfer agent may, in accordance with section 1818 of title 12, enforce compliance by such clearing agency or transfer agent with the provisions of this section, sections 78q and 78s of this title, and the rules and regulations thereunder. For purposes of the preceding sentence, any violation of any such provision shall constitute adequate basis for the issuance of an order under section 1818
(b) or 1818
(c) of title 12, and the participants in any such clearing agency and the persons doing business with any such transfer agent shall be deemed to be “depositors” as that term is used in section 1818
(c) of title 12.
Physical movement of securities certificates The Commission shall use its authority under this chapter to end the physical movement of securities certificates in connection with the settlement among brokers and dealers of transactions in securities consummated by means of the mails or any means or instrumentalities of interstate commerce.
Rules concerning transfer of securities and rights and obligations of involved or affected parties (1)
3 Due diligence for the delivery of dividends, interest, and other valuable property rights (1)
Revision of rules required The Commission shall revise its regulations in section 240.17Ad–17 of title 17, Code of Federal Regulations, as in effect on December 8, 1997, to extend the application of such section to brokers and dealers and to provide for the following:
Rulemaking The Commission shall adopt such rules, regulations, and orders necessary to implement this subsection no later than 1 year after July 21, 2010. In proposing such rules, the Commission shall seek to minimize disruptions to current systems used by or on behalf of paying agents to process payment to account holders and avoid requiring multiple paying agents to send written notification to a missing security holder regarding the same not yet negotiated check.
3 Registration requirement It shall be unlawful for a clearing agency, unless registered with the Commission, directly or indirectly to make use of the mails or any means or instrumentality of interstate commerce to perform the functions of a clearing agency with respect to a security-based swap.
Voluntary registration A person that clears agreements, contracts, or transactions that are not required to be cleared under this chapter may register with the Commission as a clearing agency.
Standards for clearing agencies clearing security-based swap transactions To be registered and to maintain registration as a clearing agency that clears security-based swap transactions, a clearing agency shall comply with such standards as the Commission may establish by rule. In establishing any such standards, and in the exercise of its oversight of such a clearing agency pursuant to this chapter, the Commission may conform such standards or oversight to reflect evolving United States and international standards. Except where the Commission determines otherwise by rule or regulation, a clearing agency shall have reasonable discretion in establishing the manner in which it complies with any such standards.
Rules The Commission shall adopt rules governing persons that are registered as clearing agencies for security-based swaps under this chapter.
Exemptions The Commission may exempt, conditionally or unconditionally, a clearing agency from registration under this section for the clearing of security-based swaps if the Commission determines that the clearing agency is subject to comparable, comprehensive supervision and regulation by the Commodity Futures Trading Commission or the appropriate government authorities in the home country of the agency. Such conditions may include, but are not limited to, requiring that the clearing agency be available for inspection by the Commission and make available all information requested by the Commission.
Existing depository institutions and derivative clearing organizations (1)
In general A depository institution or derivative clearing organization registered with the Commodity Futures Trading Commission under the Commodity Exchange Act [7 U.S.C. 1 et seq.] that is required to be registered as a clearing agency under this section is deemed to be registered under this section solely for the purpose of clearing security-based swaps to the extent that, before July 21, 2010—
Sharing of information The Commodity Futures Trading Commission shall make available to the Commission, upon request, all information determined to be relevant by the Commodity Futures Trading Commission regarding a derivatives clearing organization deemed to be registered with the Commission under paragraph (1).
Modification of core principles The Commission may conform the core principles established in this section to reflect evolving United States and international standards.
(June 6, 1934, ch. 404, title I, § 17A, as added Pub. L. 94–29, § 15,June 4, 1975, 89 Stat. 141; amended Pub. L. 100–181, title III, § 322,Dec. 4, 1987, 101 Stat. 1257; Pub. L. 101–429, title II, § 206,Oct. 15, 1990, 104 Stat. 941; Pub. L. 101–432, § 5,Oct. 16, 1990, 104 Stat. 973; Pub. L. 101–550, title II, § 203(c)(1),Nov. 15, 1990, 104 Stat. 2718; Pub. L. 106–554, § 1(a)(5) [title II, §§ 206(d), 207], Dec. 21, 2000, 114 Stat. 2763, 2763A–431, 2763A–434; Pub. L. 107–204, title VI, § 604(c)(1)(C),July 30, 2002, 116 Stat. 796; Pub. L. 111–203, title VII, § 763(b), title IX, §§ 925(a)(3), 929W,July 21, 2010, 124 Stat. 1768, 1851, 1869.)
This chapter, referred to in subsecs. (a)(2), (b)(3)(A), (F), (I), (8), (d)(1), (3)(B), (4), (5), and (e), and (h) to (j), was in the original “this title”. See References in Text note set out under section 78a of this title.
The Commodity Exchange Act, referred to in subsecs. (b)(8) and (l)(1), is act Sept. 21, 1922, ch. 369, 42 Stat. 998, which is classified generally to chapter 1 (§ 1 et seq.) of Title 7, Agriculture. For complete classification of this Act to the Code, see section 1 of Title 7 and Tables.
2010—Subsec. (c)(4)(C). Pub. L. 111–203, § 925(a)(3), substituted “12 months or bar any such person from being associated with any transfer agent, broker, dealer, investment adviser, municipal securities dealer, municipal advisor, or nationally recognized statistical rating organization,” for “twelve months or bar any such person from being associated with the transfer agent,”.
Subsec. (g). Pub. L. 111–203, § 929W, added subsec. (g) relating to due diligence for the delivery of dividends, interest, and other valuable property rights.
Pub. L. 111–203, § 763(b), added subsec. (g) relating to registration requirement.
Subsecs. (h) to (m). Pub. L. 111–203, § 763(b), added subsecs. (h) to (m).
2002—Subsec. (c)(3)(A), (4)(C). Pub. L. 107–204inserted “, or is subject to an order or finding,” before “enumerated” and substituted “(H), or (G)” for “or (G)”.
2000—Subsec. (b)(3)(A). Pub. L. 106–554, § 1(a)(5) [title II, § 207(1)], inserted “and derivative agreements, contracts, and transactions” after “prompt and accurate clearance and settlement of securities transactions”.
Subsec. (b)(3)(F). Pub. L. 106–554, § 1(a)(5) [title II, § 207(2)], inserted “and, to the extent applicable, derivative agreements, contracts, and transactions” after “designed to promote the prompt and accurate clearance and settlement of securities transactions”.
Subsec. (b)(7). Pub. L. 106–554, § 1(a)(5) [title II, § 206(d)], added par. (7).
Subsec. (b)(8). Pub. L. 106–554, § 1(a)(5) [title II, § 207(3)], added par. (8).
1990—Subsec. (a)(2). Pub. L. 101–432, § 5(a), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “The Commission is directed, therefore, having due regard for the public interest, the protection of investors, the safeguarding of securities and funds, and maintenance of fair competition among brokers and dealers, clearing agencies, and transfer agents, to use its authority under this chapter to facilitate the establishment of a national system for the prompt and accurate clearance and settlement of transactions in securities (other than exempted securities) in accordance with the findings and to carry out the objectives set forth in paragraph (1) of this subsection. The Commission shall use its authority under this chapter to assure equal regulation under this chapter of registered clearing agencies and registered transfer agents.”
Subsec. (c)(3)(A), (4)(C). Pub. L. 101–550substituted “(A), (D), (E), or (G)” for “(A), (D), or (E)”.
Subsec. (d)(5). Pub. L. 101–429added par. (5).
Subsec. (f). Pub. L. 101–432, § 5(b), added subsec. (f).
1987—Subsec. (c)(2). Pub. L. 100–181, § 322(1), (2), inserted “and any persons associated with the transfer agent” in first sentence and substituted “45” for “thirty” in second sentence.
Subsec. (c)(3), (4). Pub. L. 100–181, § 322(3)–(5), added par. (3), struck out former par. (3)(A) which read as follows: “The appropriate regulatory agency for a transfer agent, by order, shall deny registration to, censure, place limitations on the activities, functions, or operations of, suspend for a period not exceeding twelve months, or revoke the registration of such transfer agent, if such appropriate regulatory agency finds, on the record after notice and opportunity for hearing, that such denial, censure, placing of limitations, suspension, or revocation is in the public interest and that such transfer agent has willfully violated or is unable to comply with any provision of this section or section 78q of this title or the rules or regulations thereunder.”, redesignated subpars. (B) and (C) of former par. (3) as subpars. (A) and (B), respectively, of new par. (4), and added subpar. (C) to such par. (4).
Subsec. (d)(3)(B). Pub. L. 100–181, § 322(6), substituted “clearing agency, transfer agent, or person associated with a transfer agent” for “clearing agency or transfer agent”.
Subsec. (d)(4). Pub. L. 100–181, § 322(7), substituted “, transfer agent, or person associated with a transfer agent,” for “or transfer agent”.
Amendment by sections 925(a)(3) and 929W ofPub. L. 111–203effective 1 day after July 21, 2010, except as otherwise provided, see section 4 ofPub. L. 111–203, set out as an Effective Date note under section 5301 of Title 12, Banks and Banking.
Amendment by section 763(b) ofPub. L. 111–203effective on the later of 360 days after July 21, 2010, or, to the extent a provision of subtitle B (§§ 761–774) of title VII of Pub. L. 111–203requires a rulemaking, not less than 60 days after publication of the final rule or regulation implementing such provision of subtitle B, see section 774 ofPub. L. 111–203, set out as a note under section 77b of this title.
Section effective June 4, 1975, except for subsecs. (b) and (c) which are effective 180 days after June 4, 1975, see section 31(a) ofPub. L. 94–29, set out as a note under section 78b of this title.
Section 8(b) ofPub. L. 101–432directed Securities and Exchange Commission, in consultation with Commodity Futures Trading Commission, Board of Governors of the Federal Reserve System, and other relevant regulatory authorities, to examine progress toward establishing linked or coordinated facilities for clearance and settlement of transactions in securities, securities options, contracts of sale for future delivery and options thereon, and commodity options, and to submit to Congress, not later than 2 years from Oct. 16, 1990, a report detailing and evaluating such progress.
This is a list of parts within the Code of Federal Regulations for which this US Code section provides rulemaking authority.This list is taken from the Parallel Table of Authorities and Rules provided by GPO [Government Printing Office].It is not guaranteed to be accurate or up-to-date, though we do refresh the database weekly. More limitations on accuracy are described at the GPO site.12 CFR - Title 12—Banks and Banking12 CFR 9 - FIDUCIARY ACTIVITIES OF NATIONAL BANKS12 CFR Part 10 - MUNICIPAL SECURITIES DEALERS12 CFR Part 19 - RULES OF PRACTICE AND PROCEDURE12 CFR Part 208 - MEMBERSHIP OF STATE BANKING INSTITUTIONS IN THE FEDERAL RESERVE SYSTEM (REGULATION H)12 CFR Part 308 - RULES OF PRACTICE AND PROCEDURE12 CFR Part 341 - REGISTRATION OF SECURITIES TRANSFER AGENTS
17 CFR - Title 17—Commodity and Securities Exchanges17 CFR Part 200 - ORGANIZATION; CONDUCT AND ETHICS; AND INFORMATION AND REQUESTS17 CFR Part 248 - REGULATIONS S-P AND S-AM17 CFR Part 249 - FORMS, SECURITIES EXCHANGE ACT OF 193417 CFR Part 249b - FURTHER FORMS, SECURITIES EXCHANGE ACT OF 1934