[Federal Register Volume 65, Number 114 (Tuesday, June 13, 2000)]
[Notices]
[Pages 37196-37197]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-14819]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-42900; File No. SR-OCC-00-03]


Self-Regulatory Organizations; The Options Clearing Corporation; 
Notice of Filing of Proposed Rule Change To Amend OCC's By-Laws 
Relating to Clearing Member Representatives

June 5, 2000.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (``Act''), notice is hereby given that on April 6, 2000, 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 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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[[Page 37197]]

I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The proposed rule change eliminates a requirement in OCC's By-Laws 
that requires clearing members to designate a specific individual (a 
``designee'') as eligible for service as a member director or a member 
of the nominating committee. Instead, the amended By-Laws will provide 
that a member director or a member of the nominating committee must be 
a ``representative'' of a clearing member.

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 eliminate an OCC By-
Law requirement that clearing members must designate a specific 
individual (a ``designee'') to be eligible for service as a member 
director or a member of the nominating committee. Instead, OCC believes 
that it would be more administratively efficient to require that a 
member director or a member of the nominating committee must be a 
``representative'' of a clearing member. A ``representative'' is 
defined as a director, senior officer, principal or general partner of 
a clearing member. The term ``designee'' is being deleted from Article 
I, Section 1 of OCC's by-laws and conforming changes are being made to 
Section 2, 4, and 5 of Article II of OCC's By-Laws.
    In addition, the term ``elected members'' as used with respect to 
the nominating committee is being deleted since all nominating 
committee members are elected. The term ``members'' is being used 
instead. This change is being made to Section 4, 5, and 12 of Article 
III and Section 3 of Article VII and to Sections 1, 2, and 3 of the 
Stockholders Agreement.
    OCC also proposed to make other additional technical and non-
substantive changes. Section 4 of Article III is being amended to 
provide that the terms of Class I of the nominating committee expire in 
odd numbered years and that the terms of Class II expire in even number 
years. Section 5 of Article III is also being amended to provide that 
OCC may transmit rather than mail the list of nominees to clearing 
members to accommodate other means of distribution.
    OCC believes that the proposed rule change is consistent with 
Section 17a of the Act because the rule change eliminates 
administrative inefficiencies with no adverse impact to clearing member 
representation on OCC's Board of Directors.

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

    OCC does not believe that the proposed rule change will impact or 
impose a 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)(iv) \3\ of the Act and pursuant to Rule 19b-4(f)(4) \4\ 
promulgated thereunder because the proposal effects a change in an 
existing service of an OCC service that does not adversely affect the 
safeguarding of securities or funds in OCC's custody or control and 
does not significantly affect the respective rights or obligations of 
OCC or persons using the service. 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.\5\
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    \3\ 15 U.S.C. 78s(b)(3)(A)(iv).
    \4\ 17 CFR 240.19b-4(f)(4).
    \5\ 15 U.S.C. 78s(b)(3)(C).
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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, NW, Washington, DC 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, NW, 
Washington, DC 20549. 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-00-03 and should be submitted by July 
5, 2000.

    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. 00-14819 Filed 6-12-00; 8:45 am]
BILLING CODE 8010-01-M