[Federal Register Volume 63, Number 34 (Friday, February 20, 1998)]
[Notices]
[Pages 8729-8730]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-4253]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-39656; File No. SR-NSCC-97-18]


Self-Regulatory Organizations; National Securities Clearing 
Corporation; Notice of Filing and Immediate Effectiveness of a Proposed 
Rule Change Modifying the Interpretation of the Release of Clearing 
Data

February 12, 1998.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on December 23, 1997, the 
National Securities Clearing Corporation (``NSCC'') 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 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).
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The proposed rule change modifies NSCC's interpretation concerning 
the release of clearing data to regulatory and self-regulatory 
organizations to permit NSCC to pass through customer municipal 
securities transaction data required by the Municipal Securities 
Rulemaking Board (``MSRB'').

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.\2\
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    \2\ The Commission has modified parts of these statements.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    The MSRB's rules require brokers, dealers, and municipal securities 
dealers (collectively, ``dealers'') to report interdealer municipal 
securities transaction data to the MSRB. In connection with this 
requirement, NSCC currently provides the MSRB with interdealer 
municipal securities transaction data based on trades submitted to NSCC 
by dealers for automated comparison. The MSRB uses the data to maintain 
a surveillance database and to make public reports on price and volume 
of frequently traded issues.
    The MSRB has amended its rules to require dealers also to report 
customer (i.e., institutional and retail) municipal securities 
transaction data to the MSRB for transactions effected after January 1, 
1998. In connection with this requirement, the MSRB has asked NSCC to 
act as a conduit to enable dealers that are NSCC participants to use 
existing telecommunications links between NSCC and the MSRB to pass 
through the required customer municipal securities transaction data.
    NSCC's interpretation concerning the release of clearing data to 
regulatory and self-regulatory organizations is set forth in Addendum H 
to NSCC's rules and procedures. Addendum H limits the release of 
municipal securities clearing data to regulatory and self-regulatory 
organizations that have demonstrated the necessity for obtaining the 
data in furtherance of their regulatory purpose.
    The proposed rule change modifies Addendum H to permit NSCC to 
facilitate the provision of interdealer and customer municipal 
securities transaction data to the MSRB.\3\ NSCC believes that the 
provision of this data is consistent with NSCC's interpretation as it 
serves the MSRB's regulatory purposes, namely to provide transparency 
in the municipal securities market and to assist compliance by 
participants with the MSRB's rules.
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    \3\ NSCC does not intend to edit, to validate, or otherwise to 
alter the information to be received from dealers and transmitted to 
the MSRB.
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    NSCC believes the proposed rule change is consistent with Section 
17A(b)(3)(F) \4\ of the Act because provision of interdealer and 
customer municipal securities transaction data to the MSRB will help 
foster cooperation and coordination with persons engaged in the 
clearance and settlement of security transactions and in general will 
help protect investors and the public interest.
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    \4\ 15 U.S.C. 78q-1(b)(3)(F).
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(B) Self-Regulatory Organization's Statement on Burden on Competition

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

[[Page 8730]]

(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 by NSCC.

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

    Because the foregoing rule change constitutes an interpretation 
with respect to the meaning, administration, or enforcement of an 
existing rule of NSCC, it has become effective pursuant to Section 
19(b)(3)(A)(i) of the Act \5\ and Rule 19b-4(e)(1) thereunder.\6\ At 
any time within sixty days of the filing of the proposed 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.
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    \5\ 15 U.S.C. 78s(b)(3)(A)(i).
    \6\ 17 CFR 240.19b-4(e)(1).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. 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 Section, 450 Fifth street N.W., 
Washington, D.C. 20549. Copies of such filing will also be available 
for inspection and copying at the principal office of the NSCC. All 
submissions should refer to the File No. SR-NSCC-97-18 and should be 
submitted by March 13, 1998.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-4253 Filed 2-19-98; 8:45 am]
BILLING CODE 8010-01-M