[Federal Register Volume 69, Number 249 (Wednesday, December 29, 2004)]
[Notices]
[Pages 78073-78074]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E4-3866]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-50888; File No. SR-FICC-2004-19]


Self-Regulatory Organizations; Fixed Income Clearing Corporation; 
Notice of Filing of a Proposed Rule Change Relating to Changes to 
Eliminate or Amend Rules that are Inconsistent With Current Practice, 
Have Expired, Are Outdated, Are Unnecessary, or Require Technical 
Correction

December 20, 2004.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on October 7, 2004, the Fixed 
Income Clearing Corporation (``FICC'') 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 FICC. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The proposed rule change would eliminate or amend FICC's Government 
Securities Division (``GSD'') and Mortgage-Backed Securities Division 
(``MBSD'') rules that are inconsistent with current practice, have 
expired, are outdated, are unnecessary, or require technical 
correction.

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

    In its filing with the Commission, FICC 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. FICC has prepared summaries, set forth in sections A, B, 
and C below, of the most significant aspects of such statements.\2\
---------------------------------------------------------------------------

    \2\ The Commission has modified the text of the summaries 
prepared by FICC.

---------------------------------------------------------------------------

[[Page 78074]]

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

1. Delete Provisions In GSD's Rules Regarding The Automated Customer 
Account Transfer Service (``ACATS'')
    The ACATS provisions were added to GSC's rules in 1998, when the 
National Securities Clearing Corporation requested that the Government 
Securities Clearing Corpoartion (``GSCC''), the GSD's predecessor, 
establish with it an interface that would enable account transfers 
involving netting-eligible government securities to be processed using 
GSCC's existing netting and settlement processes. This service was not 
implemented and as such its continued reference in the rules is 
inconsistent with current practice.
2. Delete Provisions From GSD's Rules That Designate Participation In 
The Repo Comparison And Netting Processes
    GSD's rules currently refer to FICC as designating a member to be 
eligible to participate in the repo comparison and repo netting 
processes. When these repo services commenced in 1995, GSCC required 
testing prior to participation and subsequently designated members as 
eligible to participate in the services. Participation in these 
services has now become commonplace and special testing and designation 
for participation in the repo services is no longer necessary. As such, 
the provisions in question are outdated.
3. Make Technical Corrections To GSD Rules
    FICC proposes to make the following technical corrections to GSD's 
rules:
    i. Change the definitions of ``Interest Adjustment Payment'' and 
``Interest Rate Mark Adjustment Payment'' in GSD Rule 1 (Definitions) 
to correct an erroneous reference in both definitions to the ``Federal 
Funds Rate'' and replacing them with references to a newly defined 
term, ``Overnight Investment Rate;''
    ii. change the term in Rule 1 ``Multilateral Clearing 
Organization'' to ``Multilateral Clearing Agency;''
    iii. change the language of the definition in Rule 1 of ``Member'' 
to reflect the fact that certain members (i.e., comparison-only 
members) are approved for membership by senior management and not by 
the Membership and Risk Management Committee;
    iv. correct Section 1(d) of Rule 2, where GSD is erroneously 
referred to as its predecessors name, GSCC;
    v. delete subsection (b) of Rule 11B, which has expired;
    vi. change an incorrect reference to ``Rule 7'' to ``Rule 6C'' in 
Rule 17, Section 4; and
    vii. change a reference to the ``Membership and Standards 
Committee'' to the ``Membership and Risk Management Committee'' in Rule 
48, Section 2.
4. Technical Corrections In The MBSD Rules
    FICC proposes to renumber MBSD Rule 15 (Notices) of Article X to 
Rule 16 as it is in fact the 16th rule in that article.
    FICC believes that the proposed rule change is consistent with the 
requirements of Section 17A of the Act \3\ and the rules and 
regulations thereunder because it will eliminate unnecessary and/or 
outdated provisions and makes necessary technical changes.
---------------------------------------------------------------------------

    \3\ 15 U.S.C. 78q-1.
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    FICC does not believe that the proposed rule change will have any 
impact or 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 relating to the proposed rule change have not yet 
been solicited or received. FICC will notify the Commission of any 
written comments it receives.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission ActionWithin thirty-five days of the date of publication of 
this notice in the Federal Register or within such longer period (i) as 
the Commission may designate up to ninety days of such date if it finds 
such longer period to be appropriate and publishes its reasons for so 
finding or (ii) as to which the self-regulatory organization consents, 
the Commission will:

    (A) By order approve such proposed rule change or
    (B) institute proceedings to determine whether the proposed rule 
change should be disapproved.

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. Comments may be submitted by any of 
the following methods:
    Electronic Comments:
     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to [email protected]. Please include 
File Number SR-FICC-2004-19 on the subject line.
    Paper Comments:
     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, 
Washington, DC 20549-0609.
    All submissions should refer to File Number SR-FICC-2004-19. This 
file number should be included on the subject line if e-mail is used. 
To help the Commission process and review your comments more 
efficiently, please use only one method. The Commission will post all 
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). 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 FICC 
and on FICC's Web site at <http://ficc.com/gov/gov. docs.jsp?NS-
query=>. All comments received will be posted without change; the 
Commission does not edit personal identifying information from 
submissions. You should submit only information that you wish to make 
available publicly. All submissions should refer to File Number SR-
FICC-2004-19 and should be submitted on or before January 19, 2005.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\4\
---------------------------------------------------------------------------

    \4\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Margaret H. McFarland,
Deputy Secretary.
 [FR Doc. E4-3866 Filed 12-28-04; 8:45 am]
BILLING CODE 8010-01-P