[Federal Register Volume 68, Number 105 (Monday, June 2, 2003)]
[Notices]
[Pages 32787-32788]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-13684]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-47927; File No. SR-DTC-2003-05]


Self-Regulatory Organizations; The Depository Trust Company; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
Relating to an Enhancement to the Reorg Deposits Service

May 23, 2003.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on April 14, 2003, The 
Depository Trust Company (``DTC'') 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 DTC. 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 enhances (DTC's Reorg Deposits service to 
allow participants to submit affidavits of loss relating to 
certificates for securities currently eligible for DTC's Reorg Deposits 
service.\2\
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    \2\ For additional information concerning DTC's Reorg Deposits 
service, see Securities Exchange Act Release No. 34189 (June 9, 
1994), 59 FR 30818 (June 15, 1994) [File No. SR-DTC-94-06].
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II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposal Rule Change

    In its filing with the Commission, DTC 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. DTC has prepared summaries, set forth in sections (A), 
(B), and (C) below, of the most significant aspects of these 
statements.\3\
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    \3\ The Commission has modified the text of the summaries 
prepared by DTC.

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[[Page 32788]]

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

    DTC's Reorg Deposits service enables participants to deposit at DTC 
certificates for securities that are the subject of a reorganization 
activity after the reorganization and to have DTC collect the 
entitlements on the participants' behalf. Cash and security 
entitlements are credited to the participants' accounts upon DTC's 
receipt of the entitlements. Participants sometimes receive affidavits 
of loss instead of certificates from their customers for securities 
that are the subject of a reorganization activity, and the participants 
must bear the operational burden of presenting the affidavits of loss 
to the issuer's agent and of collecting the entitlements. Beginning 
April 15, 2003, the proposed rule change will allow participants to 
submit through DTC's Regorg Deposits service affidavits of loss 
relating the securities eligible for DTC's Reorg Deposits service and 
to have DTC collect the entitlements on their behalf. The regular Reorg 
Deposits service fee will be charged for these deposits. In addition, 
in the prior Reorg Deposits service rule filing, participants could 
deposit certificates for securities at DTC that were subject of a 
reorganization activity only up to two years after the reorganization 
activity. DTC will no longer apply this two year limit after the 
reorganization activity to any deposits in the Reorg Deposits service 
including deposits of certificates or submissions of affidavits of 
loss.
    DTC believes that the proposed rule change is consistent with the 
requirements of Section 17A of the Act and the rules and regulations 
thereunder applicable to DTC because it will contribute to efficiencies 
in the handling of affidavits evidencing ownership of lost securities 
that are the subject of reorganization activities. The proposed rule 
change, which enhances DTC's existing reorganization and deposit 
services, will be implemented consistently with the safeguarding of 
securities and funds in DTC's custody or control or for which it is 
responsible.

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

    DTC perceives no adverse impact on competition by reason of the 
proposed rule change.

(D) Self-Regulatory Organization's Statement on Comments on the 
Proposed Rule Change Received From Members, Participants or Others

    Written comments from DTC participants or others have not be 
solicited or received on the proposed rule change

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 \4\ and Rule 19b-4(f)(4) \5\ promulgated 
thereunder because the proposal effects a change in an existing service 
of DTC that (i) does not adversely affect the safeguarding of 
securities or funds in the custody or control of DTC or for which it is 
responsible and (ii) does not significantly affect the respective 
rights or obligations of DTC or persons using the service. At any time 
within sixty days of the filing of the 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.
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    \4\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \5\ 17 CFR 240.19b-4(f)(4).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including the proposed rule changes 
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-
STC-2003-05. 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 be 
available for inspection and copying at the principal office of DTC. 
All submissions should refer to File No. SR-DTC-2003-05 and should be 
submitted by June 23, 2003.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\6\
Jill M. Peterson,
Assistant Secretary.
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    \6\ 17 CFR 200.30-3(a)(12).
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[FR Doc. 03-13684 Filed 5-30-03; 8:45 am]
BILLING CODE 8010-01-M