[Federal Register Volume 66, Number 219 (Tuesday, November 13, 2001)]
[Notices]
[Pages 56878-56879]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-28352]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-45030; File No. SR-OCC-2001-15]


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

November 6, 2001.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on October 22, 2001, 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 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 would amend OCC's by-laws and rules to 
eliminate the theoretical ability of clearing members to choose a 
correspondent clearing corporation.

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 these 
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 amend OCC by-laws and 
rules to eliminate the theoretical ability of a clearing member to 
choose a correspondent clearing corporation to act on the clearing 
member's behalf for purposes of effecting settlements of exercised 
stock options, BOUNDs, and matured physically settled security futures 
(collectively, ``physical delivery contracts''). The current by-laws 
describe a correspondent clearing corporation as a clearing 
corporation, as defined under the Act, which by agreement with OCC 
provides facilities for settling physical delivery contracts. The 
correspondent clearing corporation selected by a clearing member to 
effect settlement on its behalf is referred to as a designated clearing 
corporation.
    Presently, National Securities Clearing Corporation (``NSCC'') is 
the only entity that qualifies as a correspondent clearing corporation, 
which therefore negates the need for OCC's rules to allow for clearing 
member choice. OCC does not anticipate that any other entity will 
qualify as a correspondent clearing corporation in the foreseeable 
future.\3\ Accordingly, OCC desires to update its by-laws and rules to 
reflect the current reality that only NSCC qualifies as a correspondent 
clearing corporation. This change should not have any adverse impact of 
the membership.
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    \3\ Should any entity qualify as a correspondent clearing 
corporation, OCC will work with that entity to create a linked 
facility with OCC as a correspondent clearing corporation for 
purposes of settling physical delivery contracts.
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    The proposed rule change is consistent with the requirements of 
Section 17A of the Act because it keeps current OCC by-law and rule 
provisions that address linked or coordinated facilities for clearance 
and settlement of transactions in securities, securities options, and 
securities futures.

(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) of the Act and Rule 19b-4(f)(4) thereunder because it 
effects a change in an existing service of OCC that does not adversely 
affect the safeguarding of securities or funds in the custody or 
control of OCC or for which it is responsible, and it does not 
significantly affect the respective rights or obligations of the 
clearing agency or persons using the service. At any time within sixty 
days of the filing of this 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.

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

[[Page 56879]]

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-2001-15 and should be submitted by 
December 4, 2001.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\4\
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    \4\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 01-28352 Filed 11-9-01; 8:45 am]
BILLING CODE 8010-01-M