[Federal Register Volume 62, Number 188 (Monday, September 29, 1997)]
[Notices]
[Pages 50977-50978]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-25692]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-39114; File No. SR-DTC-97-15]


Self-Regulatory Organizations; The Depository Trust Company; 
Notice of Filing of Proposed Rule Change Relating to the Coupon 
Collection Service

September 22, 1997.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on July 15, 1997, The 
Depository Trust Company (``DTC'') 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 DTC. The Commission is publishing this notice to solicit 
comments from interested persons on the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The proposed rule change revises DTC's fee schedule for its coupon 
collection service (``CCS''). DTC will give participants that use CCS a 
discount of $0.25 per shell for any month in which the participant's 
shell deposit volume is 6,250 or greater. If a participant's year-end 
shell deposit volume is 75,000 or greater, DTC will rebate to the 
participant the $0.25 per shell for any month(s) in that year for which 
the participant did not receive a discount because its shell deposit 
volume was less than 6,250.
    In addition, DTC will charge participants $0.60 per shell received 
without a valid CUSIP number. This additional fee is designed to serve 
as an incentive to Participants to identify their shells properly. As 
all of DTC's fees are reviewed on an annual basis, this surcharge will 
be reevaluated each year, based on the proportion of shells that DTC 
receives without a valid CUSIP number.

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

    In its filing with the Commission, DTC 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. DTC has prepared summaries, set forth in sections (A), 
(B), and (C) below, of the most significant aspects of such 
statements.\2\
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    \2\ The Commission has modified the text of the summaries 
prepared by DTC.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    CCS provides participants with a method for the collection of 
interest relating to coupons from municipal bearer bonds.\3\ 
Participants using CCS are required to deposit coupons in a standard 
sealed envelope or ``shell'' each of which may contain no more than 200 
coupons. Participants also must identify each shell properly, which 
includes labeling each shell with a valid CUSIP number.\4\ After 
verifying the contents of the shells, DTC credits the participants with 
the interest due on the coupons contained in the shells.
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    \3\ For a more detailed description of CCS, refer to Securities 
Exchange Act Release No. 35750 (January 22, 1996), 61 FR 2852 [File 
No. SR-DTC-95-18] (order approving proposed rule change).
    \4\ The coupons contained in a shell must all be for the same 
CUSIP number, series, and payable date.
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    The purpose of the proposed rule change is to revise the fees 
associated with CCS. DTC continually strives to align service fees with 
estimated service costs and the subject revisions are part of that 
effort.
    DTC believes that the proposed rule change is consistent with the 
requirements of Section 17A of the Act \5\ and the rules and 
regulations thereunder because it provides for the equitable allocation 
of dues, fees, and other charges among DTC's participants.
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    \5\ 15 U.S.C. 78q-1.
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(B) Self-Regulatory Organization's Statement on Burden on Competition

    DTC does not believe that the proposed rule change will impose any 
burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act.

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

    Not applicable.

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)(ii) of the Act \6\ and Rule 19b-4(e)(2) thereunder \7\ 
because the proposal establishes or changes a due, fee, or other charge 
imposed by DTC.\8\ 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,

[[Page 50978]]

or otherwise in furtherance of the purposes of the Act.
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    \6\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \7\ 17 CFR 240.19b-4(e)(2).
    \8\ DTC's rule filing originally was submitted for consideration 
pursuant to Section 19(b)(2) of the Act. 15 U.s.C. 78s(b)(2). 
However, DTC subsequently requested that the Commission consider the 
rule filing pursuant to Rule 19(b)(3)(A) of the Act. Letter from 
Larry Thompson, Senior Vice President and Deputy General Counsel, 
DTC (September 22, 1997).
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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 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 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 also will be available for 
inspection and copying at the principal office of DTC. All submissions 
should refer to File No. SR-DTC-97-15 and should be submitted by 
October 20, 1997.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-25692 Filed 9-26-97; 8:45 am]
BILLING CODE 8010-01-M