[Federal Register Volume 68, Number 64 (Thursday, April 3, 2003)]
[Notices]
[Page 16337]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-8033]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-47586; File No. SR-OCC-2001-11]


Self-Regulatory Organizations; The Options Clearing Corporation; 
Order Granting Approval of a Proposed Rule Change Relating to Intraday 
Margin Deposits

March 27, 2003.

I. Introduction

    On September 7, 2001, The Options Clearing Corporation (``OCC'') 
filed with the Securities and Exchange Commission (``Commission'') 
proposed rule change SR-OCC-2001-11 pursuant to section 19(b)(1) of the 
Securities Exchange Act of 1934 (``Act'').\1\ Notice of the proposal 
was published in the Federal Register on April 26, 2002.\2\ No comment 
letters were received. For the reasons discussed below, the Commission 
is granting approval of the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ Securities Exchange Act Release No. 45787, (April 19, 2002), 
67 FR 20859.
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II. Description

    The purpose of the proposed rule change is to add language to Rule 
609 to make explicit OCC's policies with respect to required deposits 
of intraday margin. OCC can require a deposit of intraday margin for a 
variety of reasons. Most often, deposits of intraday margin are 
required in response to changes in market conditions that affect the 
value of clearing members' positions and/or collateral. Currently, rule 
609 states that OCC's Chairman, Management Vice Chairman, and President 
are each authorized to require any clearing member to make such 
deposits within such time period as the officer may prescribe.
    Pursuant to a long-standing policy, required deposits of intraday 
margin must be satisfied in immediately available funds within one hour 
of OCC's issuance of a debit instruction against the applicable bank 
account of a clearing member. This policy will now be explicitly set 
forth in Rule 609 although the authority to prescribe a different 
settlement time, including a shorter settlement time, will be 
preserved. In order to expedite processing, the individuals authorized 
to require intraday margin deposits will now include any officer of OCC 
so authorized by the Chairman, Management Vice Chairman, or President.

III. Discussion

    Section 17A(b)(3)(F) of the Act requires that the rules of a 
clearing agency be designed to assure the safeguarding of securities 
and funds which are in the custody or control of OCC.\3\ By making 
explicit certain OCC procedures related to required deposits of 
intraday margin, the proposed rule change adds certainty and clarity to 
OCC's rules and operations related to the collection of intraday margin 
and as such should help OCC provide for which the safeguarding of 
securities and funds in its custody or control. Therefore, the 
Commission finds that the rule change is consistent with section 17A 
and the rules and regulations thereunder.
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    \3\ 15 U.S.C. 78q-1(b)(3)(F).
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IV. Conclusion

    On the basis of the foregoing, the Commission finds that the 
proposed rule change is consistent with the requirements of the Act and 
in particular with the requirements of section 17A of the Act and the 
rules and regulations thereunder applicable.
    It is therefore ordered, pursuant to section 19(b)(2) of the Act, 
that the proposed rule change (File No. SR-OCC-2001-11) be and hereby 
is approved.

    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. 03-8033 Filed 4-2-03; 8:45 am]
BILLING CODE 8010-01-P