[Federal Register: February 5, 2004 (Volume 69, Number 24)]
[Notices]
[Page 5623-5624]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr05fe04-153]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-49142; File No. SR-FICC-2004-02]
Self-Regulatory Organizations; Fixed Income Clearing Corporation;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Remove From FICC's Rules the Cross-Margining Agreement With BrokerTec
Clearing Company and the Cross-Margining Agreement With The Clearing
Corporation
January 28, 2004.
Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on January 12, 2004, the
Fixed Income Clearing Corporation (``FICC'') filed with the Securities
and Exchange Commission (``Commission'') the proposed rule change
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 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 purpose of the proposed rule change is to remove from FICC's
Rules the cross-margining agreement with BrokerTec Clearing Company
(``BCC'') \2\ and to remove from FICC's Rules the cross-margining
agreement with The Clearing Corporation (``TCC'').\3\
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\2\ Securities Exchange Act Release No. 45656 (March 27, 2002),
67 FR 15646 (April 2, 2002) [File No. SR-GSCC-2002-01].
\3\ Securities Exchange Act Release No. 45335 (January 25,
2002), 67 FR 4768 (January 31, 2001) [File No. SR-GSCC-2001-03].
FICC entered into the cross-margining agreement with the Board of
Trade Clearing Corporation, predecessor to The Clearing Corporation.
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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 these
statements.\4\
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\4\ The Commission has modified the text of the summaries
prepared by FICC.
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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 remove from FICC's
Rules the cross-margining agreement with BCC and the cross-margining
agreement with TCC. Termination of the cross-margining agreement with
BCC was necessitated by the fact that BCC ceased clearing operations on
November 26, 2003, as a result of the suspension of business by the
exchange for which BCC was the clearing corporation, BrokerTec Futures
Exchange. Termination of the cross-margining agreement with TCC was
necessitated by the fact that on January 2, 2004, TCC ceased clearing
the Chicago Board of Trade products that were the subject of the cross-
margining arrangement.\5\
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\5\ TCC recently announced that it will become the clearing
corporation for another exchange and has approached FICC regarding
establishing a new cross-margining arrangement. Upon the parties'
agreement on the details of the new arrangement, FICC will submit a
proposed rule change to the Commission covering the proposed
arrangement.
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The proposed rule change is consistent with section
17A(a)(2)(A)(ii) of the Act \6\ and the rules and regulations
thereunder because it facilitates the establishment of linked or
coordinated facilities for clearance and settlement of transactions in
securities.
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\6\ 15 U.S.C. 78q-1(a)(2)(A)(ii).
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(B) Self-Regulatory Organization's Statement on Burden on Competition
FICC does not believe that the proposed rule change will have any
impact on 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
No written comments relating to the proposed rule change have been
[[Page 5624]]
solicited or received. FICC will notify the Commission of any written
comments received by FICC.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective upon filing pursuant
to section 19(b)(3)(A)(iii) of the Act \7\ and Rule 19b-4(f)(4) \8\
thereunder because the proposed rule does not significantly affect the
respective rights or obligations of the clearing agency or persons
using the service and does not adversely affect the safeguarding of
securities or funds in the custody or control of the clearing agency or
for which it is responsible. At any time within sixty days of the
filing of such 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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\7\ 15 U.S.C. 78s(b)(3)(A)(iii).
\8\ 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 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: rule-comments@sec.gov. All comment letters should refer to
File No. SR-FICC-2004-02. 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, 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-
0609. 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://www.ficc.com.
All submissions should refer to File No. SR-FICC-2004-02 and should
be submitted by February 26, 2004.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12).
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J. Lynn Taylor,
Assistant Secretary.
[FR Doc. 04-2360 Filed 2-4-04; 8:45 am]
BILLING CODE 8010-01-P