[Federal Register Volume 60, Number 121 (Friday, June 23, 1995)]
[Notices]
[Page 32722]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-15370]



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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-35853; File No. SR-NSCC-95-05]


Self-Regulatory Organizations; National Securities Clearance 
Corporation; Order Granting Accelerated Approval of a Proposed Rule 
Change Modifying Procedures Relating to the Trade Comparison Service 
for Debt Securities

June 16, 1995.
    On April 19, 1995, the National Securities Clearing Corporation 
(``NSCC'') filed with the Securities and Exchange Commission 
(``Commission'') a proposed rule change (File No. SR-NSCC-95-05) 
pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'').\1\ On April 27, 1995, NSCC filed an amendment to the 
proposed rule change requesting the Commission to consider the rule 
filing pursuant to Section 19(b)(2) \2\ of the Act rather than under 
Section 19(b)(3)(A) \3\ of the Act as originally filed.\4\ Notice of 
the proposal was published in the Federal Register on May 25, 1995.\5\ 
No comment letters were received. For the reasons discussed below, the 
Commission is granting accelerated approval of the proposed rule 
change.

    \1\ 15 U.S.C. 78s(b)(1) (1988).
    \2\ 15 U.S.C. 78s(b)(2) (1988).
    \3\ 15 U.S.C. 78s(b)(3)(A) (1988).
    \4\ Letter from John P. Barry, Associate Counsel, NSCC, to Peter 
Geraghty, Senior Counsel, Division of Market Regulations, Commission 
(April 24, 1995).
    \5\ Securities Exchange Act Release No. 35733 (May 18, 1995), 60 
FR 27800.
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I. Description of the Proposal

    NSCC is modifying its procedures relating to the trade comparison 
service for debt securities. Specifically, NSCC is expanding the 
parameters for trade input and trade comparison for transactions in 
debt securities. The rule change will expand the comparison parameters 
for debt securities from $.05 per $1,000 of contract amount to a net 
$10 difference per trade for trades of $100,000 or less and to $.10 per 
$1,000 of contract amount for trades greater than $100,000. NSCC will 
continue to advise participants of money differences for fixed income 
transactions on the morning of T+1 when contract prices are reported to 
transaction parties.
    NSCC expects to implement the proposed rule change during the late 
part of the second quarter of 1995. Participants will be notified of 
the exact date of this change by an NSCC Important Notice.

II. Discussion

    Section 17A(b)(3)(F)\6\ requires that the rules of a clearing 
agency be designed to promote the prompt and accurate clearance and 
settlement of securities transactions. The Commission believes that 
NSCC's proposed rule change is consistent with the requirements of 
Section 17A(b)(3)(F) because expanding the comparison parameters for 
trades in debt securities should increase the initial trade date 
comparison rate for such transactions. Although NSCC has established 
comprehensive and effective procedures for the resolution of uncompared 
trades,\7\ expanding the comparison parameters to increase the initial 
trade date comparison rate should result in a greater number of trades 
in debt securities being reported as compared earlier in the settlement 
cycle. Earlier comparison should provide greater certainty that those 
trades will settle on settlement date. Consequently, NSCC members 
should have to spend less time and resources on the supplemental 
activity required to resolve uncompared trades. Accordingly, the 
Commission believes that the proposed rule change should facilitate a 
faster and more effective comparison process and thereby should enhance 
the prompt and accurate clearance and settlement of securities 
transactions.

    \6\ 15 U.S.C. 78q-1(b)(3)(F) (1988).
    \7\ NSCC, Rules and Procedures, Procedure II.D.2. (June 7, 
1995).
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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 because it will permit NSCC to 
notify its members and to begin use of the proposed rule change within 
NSCC's implementation schedule. In addition, as of the end of the 
period for public comment, the Commission had not received any comment 
letters on NSCC's proposal.

III. Conclusion

    For the reasons stated above, the Commission finds that the 
proposal is consistent with the requirements of Section 17A of the Act 
\8\ and the rules and regulations thereunder.

    \8\ 15 U.S.C. Sec. 78q-1 (1988).
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    It is Therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\9\ that the proposed rule change (File No. SR-NSCC-95-05) be, and 
hereby is, approved.

    \9\ 15 U.S.C. Sec. 78s(b)(2) (1988).
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    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\10\

    \10\ 17 CFR 200.30-3(a)(12) (1994).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 95-15370 Filed 6-22-95; 8:45 am]
BILLING CODE 8010-01-M