[Federal Register Volume 67, Number 116 (Monday, June 17, 2002)]
[Notices]
[Pages 41287-41288]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-15135]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-46058; File No. SR-OCC-2002-08]
Self-Regulatory Organizations; the Options Clearing Corporation;
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change
Relating to an Agreement To Provide Clearance and Settlement Services
to the Island Futures Exchange, LLC With Respect to Security Futures
June 10, 2002.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on May 15, 2002, The Options
Clearing Corporation (``OCC'') 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
OCC. The Commission is publishing this notice to solicit comments on
the proposed rule change from interested persons.
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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 the Security Futures Agreement
for Clearing and Settlement Services entered into between OCC and The
Island Futures Exchange, LLC (``IFX'').
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, OCC 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. OCC 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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(A) Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
OCC is preparing to clear security futures for a number of markets.
One such market is IFX. As it represented in a previous rule filing,
OCC intends to file with the Commission the agreements it enters into
with these markets when negotiated.\3\ This filing concerns the
Security Futures Agreement for Clearing and Settlement services that
OCC has entered into with IFX (``IFX Clearing Agreement'').
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\3\ See Securities Exchange Act Release No. 44727, (August 20,
2001), 66 FR 45351 [File No. SR-OCC-2001-07] (order approving
comprehensive set of rule changes pertaining to clearance and
settlement of security futures transactions). OCC also has filed a
proposed rule change with the Commission [File No. SR-OCC-2002-07]
requesting approval of clearing agreements with OneChicago and the
Chicago Mercantile Exchange.
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The terms of the IFX Clearing Agreement are based on the terms of
the Agreement for Clearing and Settlement Services entered into with
Nasdaq Liffe Markets, LLC, formerly Nasdaq LIFFE, LLC, (``NqLX Clearing
Agreement'') which has been approved by the Commission.\4\ The terms of
the IFX Clearing Agreement are substantially the same as the terms of
the NqLX Clearing Agreement. The notable differences are as follows:
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\4\ Id.
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Section 5, ``Comparison of Security Futures Transactions;
Settlement Prices,'' has been modified to specify the parties'
agreements with respect to setting a daily settlement price if OCC does
not accept IFX's reported price. New paragraph (c) has been added to
address OCC's right to determine a final settlement price under certain
circumstances. Section 5 also makes explicit that the parties'
agreements establishing such settlement prices must be consistent with
OCC's by-laws and rules.\5\ New paragraph (c) is added to Section 16,
``Indemnification,'' to cover intellectual property claims. New
language in Section 19, ``Breach of Agreement-Termination,'' provides
additional grounds for termination. The parties' agreements on
confidentiality of information have been incorporated in a letter
agreement between the parties.
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\5\ Article XII, Sections 5 and 6; Rule 1301(d).
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OCC believes that the proposed rule change is consistent with the
purposes and requirements of Section 17A of the Act because the
proposed rule change will foster cooperation and coordination with
persons engaged in the clearance and settlement of securities
transactions and will remove impediments to and perfect the mechanism
of a national system for the prompt and accurate clearance and
settlement of securities transactions.
(B) Self-Regulatory Organization's Statement on Burden on Competition
OCC does not believe that the proposed rule change would impose any
burden on competition.
[[Page 41288]]
(C) Self-Regulatory Organization's Statement on Comments on the
Proposed Rule Change Received From Members, Participants, or Others
Written comments were not and are not intended to be solicited with
respect to the proposed rule change, and none have been received.
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)(i) of the Act \6\ and Rule 19b-4(f)(1) \7\ thereunder
because it constitutes a stated policy, practice or interpretation with
respect to the meaning, enforcement or administration of an existing
rule. 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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\6\ 15 U.S.C. 78s(b)(3)(A)(i).
\7\ 17 CFR 240.19b-4(f)(1).
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VI. 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.
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 OCC. All submissions
should refer to the File No. SR-OCC-2002-08 and should be submitted by
July 8, 2002.
For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\8\
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\8\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 02-15135 Filed 6-14-02; 8:45 am]
BILLING CODE 8010-01-P