[Federal Register Volume 59, Number 71 (Wednesday, April 13, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-8806]


[[Page Unknown]]

[Federal Register: April 13, 1994]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-33852; File No. SR-NSCC-94-03]

 

Self-Regulatory Organizations; National Securities Clearing 
Corporation; Notice of Filing and Order Granting Accelerated Approval 
of a Proposed Rule Change Amending NSCC's By-laws to Provide for an 
Additional Member of the Board of Directors

April 1, 1994.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on March 4, 1994, the 
National Securities Clearing Corporation (``NSCC'') filed with the 
Securities and Exchange Commission (``Commission'') the proposed rule 
change as described in Items I and II below, which Items have been 
primarily prepared 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) (1988).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The proposed rule change amends NSCC's by-laws to allow for an 
additional member of the board of directors.

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.

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

    When NSCC was formed, the number of directors on the board was 
sixteen. To provide a greater representation of the participants in the 
management of NSCC, the number of directors on the board was increased 
to seventeen in 1984 and to eighteen in 1990.\2\ NSCC's participant 
base has expanded significantly since 1990. Therefore, NSCC believes 
that it is in the participants' interest that the number of directors 
again be increased. NSCC's by-laws permit the number of directors to be 
increased from time to time. The rule change consists of an amendment 
to the by-laws increasing the number of directors on the board from 
eighteen to nineteen. Pursuant to NSCC's shareholders agreement, the 
board of directors is made up as follows: One director representing 
each shareholder (i.e., the New York Stock Exchange, American Stock 
Exchange, and National Association of Securities Dealers), one director 
representing NSCC's management (i.e., NSCC's president and chief 
executive officer), and the remaining directors are selected from 
NSCC's participants. The additional participant director will further 
the opportunity for participants to be represented on the board and to 
participate in the administration of NSCC.
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    \2\Securities Exchange Act Release No. 27984 (May 2, 1990), 55 
FR 19400 [File No. SR-NSCC-90-02] (order approving proposed rule 
change).
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    NSCC believes the proposed rule change is consistent with section 
17A(b)(3)(C)\3\ of the Act because it increases the opportunity for 
NSCC's participants to be involved in the administration of NSCC's 
affairs.
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    \3\15 U.S.C. 78q-1(b)(3)(C) (1988).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    NSCC does not believe that the proposed rule change will have an 
impact or impose a burden on competition.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received from Members, Participants, or Others

    No written comments have been solicited or received. NSCC will 
notify the Commission of any written comments received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Section 17A(b)(3)(C)\4\ states that the rules of a clearing agency 
must assure a fair representation of its shareholders (or members) and 
participants in the selection of its directors and administration of 
its affairs. The Commission believes that the proposed increase in the 
number of directors on the board is consistent with NSCC's obligations 
under section 17A because the result will be a board which reflects, to 
a greater degree, NSCC's participants. As a result, participants will 
be afforded additional opportunities to raise, discuss, and help 
resolve issues that effect them.
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    \4\Id.
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    NSCC has requested that the Commission find good cause for 
approving the proposed rule change prior to the thirtieth day after the 
date of publication of notice of the filing. The Commission finds good 
cause for so approving the proposed rule change because it will give 
NSCC the opportunity to have the additional participant member elected 
and possibly participate in the next board meeting, which is scheduled 
for April 1994.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street NW., Washington, DC 20549. 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 provisions of 5 
U.S.C. 552, will be available for inspection and copying in the 
Commission's Public Reference Section, 450 Fifth Street NW., 
Washington, DC 20549. Copies of such filing also will be available for 
inspection and copying at the principal office of NSCC. All submissions 
should refer to File No. SR-NSCC-94-03 and should be submitted by May 
4, 1994.
    It Is Therefore ordered, pursuant to section 19(b)(2) of the 
Act,\5\ that the proposed rule change (File No. SR-NSCC-94-03) be, and 
hereby is approved.
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    \5\15 U.S.C. 78s(b)(2).

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\6\
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    \6\17 CFR 200.30-3(a)(12) (1993).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-8806 Filed 4-12-94; 8:45 am]
BILLING CODE 8010-01-M