[Federal Register Volume 63, Number 70 (Monday, April 13, 1998)]
[Notices]
[Pages 18054-18055]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-9662]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-39834; File No. SR-EMCC-98-2]


Self-Regulatory Organizations; Emerging Markets Clearing 
Corporation; Notice of Filing and Order Granting Accelerated Approval 
of Proposed Rule Change Relating to the Definition of ``Settlement 
Day''

April 6, 1998.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on April 1, 1998, the 
Emerging Markets Clearing Corporation (``EMCC'') filed with the 
Securities and Exchange Commission (``Commission'') the proposed rule 
change as described in Items I and II below, which items have been 
prepared primarily by EMCC. The Commission is publishing this notice 
and order to solicit comments from interested persons and to grant 
accelerated approval of 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 amends the definition of ``Settlement 
Day'' in EMCC's rules to provide for recommendations by trade 
organizations.

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

    In its filing with the Commission, EMCC 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. EMCC 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 EMCC.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    From time to time, trade associations, such as the Emerging Markets 
Trading Association (``EMTA'' \3\), publish schedules that establish 
recommended trading and settlement dates for the emerging markets debt 
marketplace. According to EMCC, it needs to have the ability to 
coordinate its settlement activities in a manner that is consistent 
with the settlement schedule recommended by these organizations.
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    \3\ EMTA is the trade association of those involved in trading 
emerging market instruments.
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    Currently, EMCC's rules define ``settlement day'' as the day on 
which an EMCC eligible instrument is scheduled to settle as established 
by the original contraparties to the transaction. The proposed rule 
change amends the definition of settlement day to enable EMCC to change 
the date designated as the settlement day by the contraparties if a 
trade organization recommends a different day as a settlement date. 
Before changing the settlement day, EMCC will issue an Important Notice 
to notify its members of the change. Nevertheless, the contraparties 
may use their original settlement date if they agree to settle their 
trade outside of EMCC.\4\
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    \4\ As amended, settlement day will be defined as ``the day on 
which the EMCC Eligible Instrument Transaction is scheduled to 
settle as established by the original contra-parties to the 
transaction. Notwithstanding the foregoing, if a trade organization 
issues a notice suggesting that a day not be a settlement date, and 
Members submit trades indicating such day as the Settlement Day, the 
Corporation, in its sole discretion, may change the Settlement Day 
to the next date with a settlement date as recommended by the trade 
organization.''
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    EMCC believes that the proposed rule change is consistent with the 
requirements of Section 17A of the Act and the rules and regulations 
thereunder because it will provide EMCC with the flexibility to 
coordinate settlement dates with the appropriate industry trade 
organizations.

(B) Self-Regulatory Organization's Statement on Burden on Competition

    EMCC does not believe that the proposed rule change will impose any 
burden on competition.

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

    No written comments relating to the proposed rule change have been 
solicited or received. EMCC will notify the Commission of any written 
comments received by EMCC.

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

    Section 17A(b)(3)(F) of the Act requires that the rules of a 
clearing agency be designed to foster cooperation and coordination with 
persons engaged in the clearance and settlement of securities. The 
Commission believes that allowing EMCC to amend the

[[Page 18055]]

definition of settlement day will enable EMCC to better coordinate its 
settlement activities with the recommendations of the appropriate trade 
associations.
    EMCC 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 approving the proposed rule change prior to the thirtieth day 
after publication of notice. EMTA has recommended that the emerging 
markets debt marketplace be closed in the U.S. on Good Friday, April 
10, 1998, and has issued a settlement schedule recommending that 
transactions which would otherwise be scheduled to settle on April 10, 
1998, settle on April 13, 1998. Accelerated approval will give EMCC 
adequate time to notify its members of the change in the settlement 
date.

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 also will be available 
for inspection and copying at the principal office of EMCC. All 
submissions should refer to File No. SR-EMCC-98-2 and should be 
submitted by May 4, 1998.
    It Is Therefore Ordered, pursuant to Section 19(b)(2) of the 
Act,\5\ that the proposed rule change (File No. SR-EMCC-98-2) be and 
hereby is approved.

    \5\ 15 U.S.C. 78s(b)(2).
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    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\6\
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    \6\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-9662 Filed 4-10-98; 8:45 am]
BILLING CODE 8010-01-M