[Federal Register Volume 64, Number 230 (Wednesday, December 1, 1999)]
[Notices]
[Pages 67362-67363]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-31164]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-42175; File No. SR-ISCC-99-01]


Self-Regulatory Organizations; International Securities Clearing 
Corporation; Notice of Filing of Proposed Rule Change Relating to 
ISCC's Decision To Withdraw From the Clearance and Settlement Business

November 23, 1999.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on September 23, 1999, the 
International Securities Clearing Corporation (``ISCC'') 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 ISCC. The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested parties.
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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

    Under the proposed rule change, ISCC will withdraw from the 
clearing agency business and transfer its core services to the National 
Securities Clearing Corporation (``NSCC'').

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

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

    On May 12, 1989, the Commission granted, pursuant to Sections 17A 
and 19(a) of the Act \3\ and Rule 17Ab2-1,\4\ the application of ISCC 
for registration as a clearing agency on a temporary basis for a period 
of eighteen months.\5\ Since that time, the Commission has extended 
ISCC's temporary registration through February 29, 2000.\6\
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    \3\ 15 U.S.C. 78q-1 and 78s(a),
    \4\ 17 CFR 240.17AB2-2-(c).
    \5\ Securities Exchange Act Release No. 26812 (May 12, 1989), 54 
FR 21691.
    \6\ Securities Exchange Act Release Nos. 28606 (November 16, 
1990), 55 FR 47976; 30005 (November 27, 1991), 56 FR 63747; 33233 
(November 22, 1993), 58 FR 63195; 36529 (November 29, 1995), 60 FR 
62511; 37986 (November 25, 1996), 61 FR 64184; 38703 (May 30, 1997), 
62 FR 31183; 39700 (February 26, 1998), 63 FR 10669; and 41103 
(February 24, 1999), 64 FR 10521.
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    ISCC was created to provide safe and efficient clearance and 
settlement of securities transactions between United States broker-
dealers and foreign financial institutions.\7\ ISCC serves this 
function through its core services, the Global Clearance Network 
(``GCN'') and International Link services.\8\
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    \7\ Securities Exchange Act Release Nos. 29841 (October 18, 
1991), 56 FR 55960, and 32564 (June 30, 1993), 58 FR 36722.
    \8\ ISCC has offered the International Link service since its 
inception in 1989.
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    ISCC, a wholly owned subsidiary of NSCC, proposes to deregister as 
a clearing agency and transfer its core services to NSCC because it is 
no longer cost-effective to provide such services through a separate 
company.\9\ The transfer of services of NSCC will be transparent to 
ISCC users. They will be required to perform any system modifications, 
and they will be charged the same fees for the services at NSCC as they 
are currently paying ISCC.
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    \9\ In connection with this rule filing, NSCC has submitted a 
proposed rule change (File No. SR-NSCC-99-12) to amend its rules to 
allow it to provide the GCN and the International Link Services.
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    ISCC believes that the proposed rule change is consistent with the 
requirements of Section 17A of the Act \10\ and the rules and 
regulations thereunder applicable to ISCC, because it will facilitate 
the prompt and accurate clearance and settlement of securities 
transactions.
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    \10\ 15 U.S.C. 78q-1.
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(B) Self-Regulatory Organization's Statement on Burden on Competition

    The proposed arrangements would impose no burden on competition. 
After consummation of the proposed arrangements, securities industry 
members will continue to have access to high-quality, low-cost clearing 
and custody service.

(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.

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

    Within thirty-five 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 ninety 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 the self-regulatory organization 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

[[Page 67363]]

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. Copies of such filing also will be available 
for inspection and copying at the principal office of ISCC. All 
submissions should refer to File No. SR-ISCC-99-01 and should be 
submitted by December 22, 1999.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-31164 Filed 11-30-99; 8:45 am]
BILLING CODE 8010-01-M