[Federal Register Volume 64, Number 160 (Thursday, August 19, 1999)]
[Notices]
[Pages 45295-45296]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-21538]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-41736; File No. SR-OCC-99-8]


Self-Regulatory Organizations; The Options Clearing Corporation; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
Relating to Fees and Charges

August 12, 1999.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''), \1\ notice is hereby given that on July 27, 1999, The 
Options Clearing Corporation (``OCC'') 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 OCC. 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 reduces OCC clearing fees for established 
products in the second half of 1999.

[[Page 45296]]

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

    In its filing with the Commission, OCC 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. OCC 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 OCC.
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(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 reduce the clearing 
fees charged for established products in the second half of 1999. OCC 
experienced a record volume of options cleared during the first two 
quarters of 1999. As a result, OCC proposes to reduce its level of 
clearing fees, effective July 1, 1999, as follows:

------------------------------------------------------------------------
                                                 Current
             Contract trade level                clearing     Proposed
                                                   fee      clearing fee
------------------------------------------------------------------------
1-500........................................        $0.09       $0.075
501-1000.....................................         0.07        0.06
1001-2000....................................         0.06        0.0525
>2000........................................      *110.00     *100.00
------------------------------------------------------------------------
*Flat fee.

    OCC believes that the foregoing fee change will assure each 
clearing member a discount on clearing fees. The proposed fee schedule 
change will also allow clearing members to immediately realize the 
benefits of reduced fees (rather than waiting for OCC's rebate of 
clearing fees) without adversely affecting OCC's ability to maintain an 
acceptable level of retained earnings. The clearing fees will revert to 
their current levels on the first trading day of year 2000.
    OCC believes that the proposed rule change is consistent with 
Section 17A of the Act \3\ and the rules and regulations thereunder 
because it benefits OCC's clearing members by reducing fees and 
allocating fees among clearing members in an equitable manner.
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    \3\ 15 U.S.C. 78q-1.
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(B) Self-Regulatory Organization's Statement on Burden on Competition

    OCC does not believe that the proposed rule change would impose any 
burden on competition.

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

    Written comments were not and are not intended to be solicited with 
respect to the proposed rule change, and none have been received.

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(f)(2) \5\ 
promulgated thereunder because the proposal establishes or changes a 
due, fee, or other charge imposed by OCC. At any time within sixty days 
of the filing of such 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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    \4\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \5\ 17 CFR 240.19b-4(f)(2).
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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-
0609. 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. 20549-0609. Copies of such filing also will be 
available for inspection and copying at the principal office of OCC. 
All submissions should refer to File No. SR-OCC-99-8 and should be 
submitted by September 9, 1999.

    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. 99-21538 Filed 8-18-99; 8:45 am]
BILLING CODE 8010-01-M