[Federal Register Volume 60, Number 21 (Wednesday, February 1, 1995)]
[Notices]
[Pages 6333-6335]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-2427]



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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-35264; File No. SR-SCCP-94-9]


Self-Regulatory Organizations; Stock Clearing Corporation of 
Philadelphia; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change Relating to the Automated Customer Account Transfer Service 
and the ACAT-Fund/SERV Interface

January 23, 1995.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
[[Page 6334]] (``Act''),\1\ notice is hereby given that on December 8, 
1994, the Stock Clearing Corporation of Philadelphia (``SCCP'') 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 SCCP. On December 27, 1994, and 
on January 4, 1995, SCCP amended the filing.\2\ The Commission is 
publishing this notice to solicit comments on the proposed rule change 
from interested persons.

    \1\15 U.S.C. 78s(b)(1) (1988).
    \2\Letters from J. Keith Kessel, Compliance Officer, SCCP, to 
Margaret Robb, Staff Attorney, Division of Market Regulation 
(``Division''), Commission (December 23, 1994, and December 27, 
1994).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    SCCP proposes to amend its procedures to comply with New York Stock 
Exchange (``NYSE'') rule 412, which sets forth the time for 
transferring customer accounts,\3\ and with National Securities 
Clearing Corporation (``NSCC'') Rule 50, Section 9,\4\ which governs 
NSCC's Automated Customer Account Transfer (``ACAT'') Service.\5\ SCCP 
also proposes to begin using the ACAT-Fund/SERV link\6\ on March 3, 
1995, in compliance with the NYSE requirement that all mutual fund 
account transfers be accomplished by use of an automated system where 
the NYSE member organizations are participants in a registered clearing 
agency which has such a facility.

    \3\For a complete description of the recent amendments to NYSE 
Rule 412, refer to Securities Exchange Act Release No. 34633 
(September 2, 1994), 59 FR 467872 [File No. SR-NYSE-94-21] (order 
approving amendments to NYSE Rule 412).
    \4\For a complete description of the recent amendments to NSCC's 
Rule 50, Section 9, refer to Securities Exchange Act Release No. 
34879 (October 21, 1994), 59 FR 44229 [File No. SR-NSCC-94-13] 
(other approving modifications to NSCC's ACAT Service to accelerate 
the time in which customer accounts are transferred).
    \5\For a complete description of NSCC's ACAT system, refer to 
Securities Exchange Act Release No. 22481 (September 30, 1985), 50 
FR 41274 [File No. SR-NSCC-85-7] (order approving proposed rule 
change establishing ACAT Service).
    \6\SCCP is not a member of NSCC's Fund/SERV; however, membership 
in Fund/SERV is not necessary to use the ACAT-Fund/SERV link. 
Telephone conversation between Karen L. Saperstein, Association 
General Counsel and Vice President/Director of Legal, NSCC, and 
Peter R. Geraghty, Senior Counsel, Division, Commission, and 
Margaret J. Robb, Staff Attorney, Division, Commission (January 6, 
1995).
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II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, SCCP 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. SCCP 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

    NSCC's ACAT Service is an input, comparison, and settlement service 
for customer account transfers from one brokerage firm to another. 
SCCP's proposal is consistent with NSCC's recent amendments to NSCC 
Rule 50, Section 9 which shortened the period in which a participant 
that is to receive a transferred account has to review the transfer 
instructions and reply thereto. The completed transfer cycle will be 
reduced to allow a three day validation period and a four day delivery 
period for all accounts including cash margin, retirement, and 
qualified accounts. The entire account transfer cycle is thus recuced 
from ten business days to seven business days for transferring cash or 
margin accounts and from fifteen business days to seven business days 
for transferring qualified or retirement accounts. The portion of 
SCCP's filing containing these procedures is consistent with the NYSE 
and NSCC proposals; therefore, SCCP's procedures also take effect on 
December 2, 1994.

    SCCP's proposed rule change also proposes to modify its ACAT-SERV 
interface\7\ with NSCC to comply with the NYSE requirement that 
generally all mutual fund account transfers must be accomplished by 
using the automated by using the automated systems of a registered 
clearing agency where both the receiving broker-dealer and the 
delivering broker-dealer are participants in a registered clearing 
agency which has such a facility. In accordance with NYSE Rule 412, 
this change will be effective March 3, 1995.\8\

    \7\For a detailed description of NSCC's ACAT-Fund/SERV 
interface, refer to Securities Exchange Act Release No. 27454 
(November 20, 1989), 54 FR 48962 [File No. SR-NSCC-89-12] (order 
approving modification of NSCC's ACAT Service rules to provide for 
the automated transfer of eligible book share mutual fund assets).
    \8\Supra note 2.
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    SCCP believes the proposed rule change is consistent with Section 
17A of the Act is that it promotes the prompt and accurate clearance 
and settlement of securities transactions. SCCP's believes that its 
proposed rule change setting forth the shortened time period for 
transferring accounts is appropriate because it properly reflects the 
changes set forth by the NYSE and NSCC in their efforts to enhance 
automation of the transfer process. In addition, the rule change is 
consistent with the Commission's effort to reduce the settlement cycle 
as required by Rule 15c6-1 which mandates a three business day 
settlement cycle for most broker-dealer transactions effective June 7, 
1995.\9\

    \9\For a complete description of Rule 15c6-1, refer to 
Securities Exchange Act Release Nos. 33023 (October 6, 1993), 58 FR 
52891 [File No. S7-5-93] (order adopting Commission Rule 15c6-1) and 
34952 (November 9, 1994), 59 FR 59137 [File No. S7-5-93] (change of 
effective date of Rule 15c6-1).
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(B) Self-Regulatory Organization's Statement on Burden on Competition

    SCCP 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

    SCPP has not solicited or received comments on 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)(iii)\10\ of the Act and pursuant to Rule 19b-4(e)(4)\11\ 
promulgated thereunder because the proposal effects a change in an 
existing service of SCCP that does not adversely affect the 
safeguarding of securities or funds in the custody or control of SCCP 
and does not significantly affect the respective rights of obligations 
of SCCP 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.

    \10\15 U.S.C. 78s(b)(3)(A)(iii) (1988).
    \11\17 CFR 240.19b-4(e)(4) (1994).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing. Persons making written submission 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street NW., Washington, DC 20549. Copies 
of the [[Page 6335]] 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, 450 Fifth Street NW., 
Washington, DC 20549. Copies of such filing will also be available for 
inspection and copying at the principal office of SCCP. All submissions 
should refer to File No. SR-SCCP-94-9 and should be submitted by 
February 22, 1995.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\12\

    \12\17 CFR 200.30-3(a)(12) (1994).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 95-2427 Filed 1-31-95; 8:45 am]
BILLING CODE 8010-01-M