[Federal Register Volume 68, Number 70 (Friday, April 11, 2003)]
[Notices]
[Pages 17850-17851]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-8920]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-47644; File No. SR-NSCC-2003-04]


Self-Regulatory Organizations; National Securities Clearing 
Corporation; Notice of Filing and Order Granting Accelerated Approval 
of a Proposed Rule Change Relating to NSCC's Insurance Processing 
Service

April 7, 2003.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on March 14, 2003, National 
Securities Clearing Corporation (``NSCC'') filed with the Securities 
and Exchange Commission (``Commission'') the proposed rule change as 
described in Items I and II 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 persons and to 
grant accelerated approval.
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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 consists of an enhancement to NSCC's 
Insurance Processing Service (``IPS'') that will provide information 
about insurance products to distributors of those products. The 
enhancement will allow Insurance Carrier Members and Data Services Only 
Members of NSCC to populate a series of databases maintained by NSCC 
(known collectively as the ``Product Repository'') with information 
related to insurance products.

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 such 
statements.\2\
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    \2\ The Commission has modified parts of these statements.

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[[Page 17851]]

(A) Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    The purpose of the proposed rule filing is to create an enhancement 
to IPS that will provide information about insurance products to 
distributors of those products. Insurance Carrier Members and Data 
Services Only Members of NSCC will populate the Product Repository 
databases with information related to insurance products, and Members 
and Data Services Only Members may access the Product Repository to 
obtain information about insurance products.
    The Product Repository will be a series of databases maintained by 
IPS that will contain information relating to insurance products. 
Initially, the product repository will contain information relating to 
annuities and thereafter to life insurance and other long term care 
products. With respect to each contract of a particular Insurance 
Carrier Member or Data Services Only Member, the Product Repository 
databases will be populated only by that Insurance Carrier Member or 
Data Services Only Member.
    The Insurance Carrier Member or Data Services Only Member that 
populates the relevant database for a particular contract will be 
responsible for the contents and for any necessary updates. Such 
Insurance Carrier Member or Data Services Only Member will specify any 
limitation with respect to access to such data. As with other IPS 
services, NSCC will not be responsible for the completeness or accuracy 
of any of the information contained in the databases, or for any 
errors, omissions, or delays which may occur relating to the databases 
in the absence of gross negligence on NSCC's part.
    There will be no money settlement associated with the Product 
Repository.
    NSCC believes that the proposed rule change is consistent with the 
provisions of the Act and the rules and regulations thereunder because 
it will provide information that may facilitate the prompt and accurate 
processing of transactions.

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

    NSCC does not believe that the proposed rule change would 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 Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder and particularly with the requirements of section 
17A(b)(3)(F).\3\ Section 17A(b)(3)(F) 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 the clearing agency or 
for which it is responsible. The Commission believes that the proposed 
rule change is consistent with this requirement because while providing 
a useful service to its Insurance Processing Service, NSCC is not 
responsible for the completeness or accurateness of the information of 
the database or in the absence of NSCC's gross negligence for any 
errors, omissions, or delays relating to the database. As a result, 
NSCC's ability to safeguard securities and funds which are in its 
custody or control or for which it is responsible will not be affected 
by the offering of the Product Repository databases.
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    \3\ 15 U.S.C. 78q-1(b)(3)(F).
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    NSCC has requested that the Commission approve this rule change 
prior to the thirtieth day after the date of publication of notice of 
the filing because the Product Repository will be available to NSCC's 
members beginning on April 7, 2003. The Commission finds good cause for 
approving the proposed rule change prior to the thirtieth day after 
publication of notice because by so approving NSCC will be able to 
implement the enhancements in accordance with its systems 
implementation schedule.

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. 
Comments may also be submitted electronically at the following e-mail 
address: [email protected]. All comment letters should refer to 
File No. SR-NSCC-2003-04. This file number should be included on the 
subject line if e-mail is used. To help us process and review comments 
more efficiently, comments should be sent in hardcopy or by e-mail but 
not by both methods. 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 will also be available for inspection and copying at the 
principal office of NSCC. All submissions should refer to the File No. 
SR-NSCC-2003-04 and should be submitted by May 2, 2003.

V. 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-NSCC-2003-04) 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. 03-8920 Filed 4-10-03; 8:45 am]
BILLING CODE 8010-01-P