[Federal Register Volume 66, Number 65 (Wednesday, April 4, 2001)]
[Notices]
[Pages 17981-17982]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-8211]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-44127; File No. SR-NSCC-01-02]


Self-Regulatory Organizations; National Securities Clearing 
Corporation; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change Relating to Membership Criteria for Rule 51 Fund Members

March 28, 2001.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on January 23, 2001, National 
Securities Clearing Corporation (``NSCC'') 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 NSCC. 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

    The proposed rule change will allow NSCC to modify the membership 
criteria for Rule 51 fund members.

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

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

    NSCC's Rule 51 sets forth the criteria for entities seeking access 
to NSCC's mutual fund services as a ``fund member.'' When Fund/Serv was 
originally introduced, NSCC's rules provided that a broker-dealer that 
is the principal underwriter of a mutual fund was eligible to become a 
fund member, as these were the entities that were distributing funds at 
that time. As the fund industry and NSCC's mutual fund services have 
evolved, however, members have requested and NSCC has determined that 
it would be appropriate to expand this membership category to also 
permit a broker-dealer that is a codistributor, subdistributor, or is 
otherwise authorized to process transactions through NSCC's mutual fund 
services on behalf of a fund to be eligible for NSCC membership as a 
fund member. Any such broker-dealer would have to meet all other 
previously established membership criteria.
    This rule change will permit more people to settle fund 
transactions through NSCC's automated services and therefore will 
facilitate the prompt and accurate clearance and settlement of fund 
securities transactions. The proposed rule change is therefore 
consistent with the requirements of Section 17A of the Act of 1934 and 
the rules and regulations thereunder.

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

    NSCC does not believe that the proposed rule change will have an 
impact on 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

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

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) of the Act and Rule 19b-4(f)(4) thereunder because the 
proposed rule change effects or changes an existing service that does 
not adversely affect the safeguarding of securities or funds in the 
custody or control of NSCC or for which it is responsible and does not 
significantly affect the respective rights or obligations of NSCC or 
its members using the service. At any time within sixty days of the 
filing of such 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 a furtherance of the purposes of the Act.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and

[[Page 17982]]

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 NSCC. All submissions 
should refer to File No. SR-NSCC-01-02 and should be submitted by April 
25, 2001.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 01-8211 Filed 4-3-01; 8:45 am]
BILLING CODE 8010-01-M