[Federal Register Volume 63, Number 71 (Tuesday, April 14, 1998)]
[Notices]
[Pages 18239-18240]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-9802]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-39836; File No. SR-DTC-98-01]
Self-Regulatory Organizations; The Depository Trust Company;
Notice of Filing of a Proposed Rule Change to Conform DTC's Rules to
Revised Article 8 of the Uniform Commercial Code of the State of New
York
April 7, 1998.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on January 14, 1998, The
Depository Trust Company (``DTC'') filed with the Securities and
Exchange Commission (``Commission'') the proposed rule change (File No.
SR-DTC-98-01) 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 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 purpose of the proposed rule change is to amend DTC's rules so
that they are consistent with the revisions to Article 8 of the Uniform
Commercial
[[Page 18240]]
Code of the State of New York. The proposed rule change also will amend
DTC's rules to specifically state that DTC's board of directors may by
resolution delegate to the chairman of the board the authority to
establish fees and charges.
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
Recently, New York State revised its version of Article 8 (with
related changes in other Articles) of the Uniform Commercial Code. As a
result, DTC is amending its rules to make them consistent with revised
Article 8. The proposed rule change will add new terminology to DTC's
rules,\3\ will revise certain definitions,\4\ and will delete section
references based on the prior version of Article 8. The amendments will
not change the substance or meaning of DTC's current rules. The
proposed rule change also will amend DTC Rule 20 to specifically state
that DTC's board of directors may by resolution delegate to the
chairman of the board the power to approve fees and charges.
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\3\ The proposed rule change will add the following terms to
DTC's rules: (1) Certificated security; (2) control; (3) deposit;
(4) entitlement holder; (5) entitlement order; (6) free pledge; (7)
free release; (8) NYUCC; (9) person; (10) pledge; (11) pledge versus
payment; (12) release; (13) release versus payment; (14) security
entitlement; (15) security certificate; (16) uncertificated
security; and (17) withdrawal.
\4\ The proposed rule change will make technical revisions to
the following terms: (1) clearing agency agreement; (2) deliverer;
(3) delivery; (4) deposited security; (5) incomplete transaction;
(6) instructor; (7) minimum amount securities; (8) net addition
securities; (9) participant; (10) payee; (11) payor; (12) pledged
security; (13) pledgee; (14) pledgor; (15) receiver; (16) securities
account; (17) security; (18) segregated account; and (19) settlement
amount.
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DTC believes the proposed rule change is consistent with the
requirements of Section 17A of the Act \5\ and the rules and
regulations thereunder because it promotes the safeguarding of
securities and funds in DTC's custody or under its control.
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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 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
Written comments from DTC participants or others have not been
solicited or received on the proposed rule change. All participants
will be informed of the proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing
for Commission Action
Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which DTC consents, the Commission will:
(A) By order approve such proposed rule change or
(B) Institute proceedings to determine whether the proposed rule
change should be disapproved.
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, 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 Room, 450 Fifth Street, NW., Washington,
DC 20549. Copies of such filing will also be available for inspection
and copying at the principal office of DTC. All submissions should
refer to the file number SR-DTC-98-01 and should be submitted by May 5,
1998.
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. 98-9802 Filed 4-13-98; 8:45 am]
BILLING CODE 8010-01-M