[Federal Register Volume 62, Number 54 (Thursday, March 20, 1997)] [Notices] [Pages 13425-13426] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 97-7047] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-38405; File No. SR-SCCP-97-01] Self-Regulatory Organizations; Stock Clearing Corporation of Philadelphia; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Over-the-Counter Trade Corrections March 14, 1997. Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 1934 (``Act''), notice is hereby given that on February 26, 1997, 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. The Commission is publishing this notice to solicit comments from interested persons on the proposed rule change. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The proposed rule change provides SCCP participants an additional method of forwarding over-the-counter (``OTC'') trade corrections to SCCP. 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.\2\ --------------------------------------------------------------------------- \2\ The Commission has modified the text of the summaries prepared by SCCP. --------------------------------------------------------------------------- (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 provide to SCCP's participants that have access to Philadep's Philanet system an additional method of forwarding OTC corrections to SCCP. OTC trade submissions for trades that are not looked in are submitted separately by the buyer and seller. The submissions are matched by National Stock Clearing Corporation (``NSCC'') as the central processor for OTC transactions. The primary matching criteria used by NSCC are buyer, seller, number of shares, cusip number, settlement date, and the dollar amount of the trade. When the buy and sell submissions match based on the matching criteria the trade is considered ``compared.'' When the buy and sell submissions do not match or either the buyer or seller does not submit any data, an ``uncompared'' trade results. Both buyer and seller are notified of the uncompared trade and are then able to use a series of trade correcting entries to make necessary changes to the original buy and sell entries or to enter a buy or sell transaction that was inadvertently not entered. Currently, OTC corrections are forwarded to SCCP by one of two methods. First, the submitting participant may forward its OTC corrections via facsmilie. The corrections are then entered into the system by data entry personnel at SCCP. The corrections are then appended to [[Page 13426]] the participants OTC trade file and transmitted to NSCC. Second, the submitting participant may forward OTC corrections to SCCP via electronic transmission. The corrections are then appended to the participants OTC trade file and transmitted electronically to NSCC. SCCP now proposes to afford its participants the ability to forward OTC corrections to SCCP through the participant's Philanet terminal. Philanet access provides participants with the ability to enter and modify OTC corrections through an on-line application. SCCP believes that the proposed rule change is consistent with the requirements of Section 17A of the Act \3\ and the rules and regulations thereunder because it promotes the prompt and accurate clearance and settlement of securities transactions. --------------------------------------------------------------------------- \3\ 15 U.S.C. 78q-1. --------------------------------------------------------------------------- (B) Self-Regulatory Organization's Statement on Burden on Competition This modification will not impose a burden on competition not contemplated under the Act. (C) Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others Written comments were neither solicited nor received with respect to 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) \4\ of the Act and pursuant to Rule 19b-4(e)(4) \5\ promulgated thereunder because the proposal effects a change in an existing service that (1) does not adversely affect the safeguarding of securities or funds in the custody or control of the clearing agency or for which it is responsible and (2) does not significantly affect the respective rights or obligations of the clearing agency 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. --------------------------------------------------------------------------- \4\ 15 U.S.C. 78s(b)(3)(A)(iii). \5\ 17 CFR 240.19b-4(e)(4). --------------------------------------------------------------------------- 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, N.W., Washington, D.C. 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 the provisions of 5 U.S.C. 552, will be available for inspection and copying in the Commission's Public Reference Room, 450 Fifth Street, N.W., Washington, D.C. 20549. Copies of such filing also will be available for inspection and copying at the principal office of SCCP. All submissions should refer to File No. SR-SCCP-97-01 and should be submitted by April 10, 1997. For the Commission by the Division of Market Regulation, pursuant to delegated authority.\6\ --------------------------------------------------------------------------- \6\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Jonathan G. Katz, Secretary. [FR Doc. 97-7047 Filed 3-19-97; 8:45 am] BILLING CODE 8010-01-M