[Federal Register: April 8, 2003 (Volume 68, Number 67)]
[Notices]
[Page 17139-17140]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr08ap03-138]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-47603; File No. SR-NSCC-2003-02]
Self-Regulatory Organizations; National Securities Clearing
Corporation; Notice of Filing and Order Granting Accelerated Approval
of a Proposed Rule Change Relating to Creating New Cost Basis Reporting
Service
March 31, 2003.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of
1934,\1\ notice is hereby given that on January 24, 2003, the 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 and order
to solicit comments on the proposed rule change from interested persons
and to grand 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 creates a new Cost Basis Reporting Service
(``CBRS'') that will facilitate the automated exchange of cost basis
information regarding a customer account transfer.
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 the text of the summaries
prepared by NSCC.
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[[Page 17140]]
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 add a new Rule 30 to
NSCC's Rules and Procedures (``Rules'') in order to create a new CBRS
that will facilitate the automated exchange of cost basis information
related to a customer account transfer.
NSCC has developed a cost basis reporting service to augment its
current Automated Customer Account Transfer Service (``ACATS'')
processing. Cost basis reporting is useful to customers for tax
reporting purposes. Cost basis information is currently captured and
entered into many firm's portfolio systems manually. NSCC was requested
to centralize and standardize the transmission of cost basis
information.
CBRS will be available to NSCC members and qualified securities
depositories acting on behalf of their participants and will permit
them to transmit between themselves on an automated basis cost basis
information with respect to accounts that have previously been
transferred via ACATS. Participants may send cost basis data to NSCC
multiple times during the day up to a predetermined cutoff.
NSCC 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 facilitate the prompt and
accurate clearance and settlement of securities transactions.
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\3\ 15 U.S.C. 78q-1.
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B. Self-Regulatory Organization's Statement on Burden on Competition
NSCC does not believe that the proposed rule change will 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 has notified its member of the terms of the
proposed service by an Important Notice on November 4, 2002. NSCC will
notify the Commission of any written comments it receives.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The Commission finds that NSCC's 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)\4\ of the Act. Section 17A(b)(3)(F) requires that the
rules of a clearing agency be designed to promote the prompt and
accurate clearance and settlement of securities transactions. Providing
an automated and standardized method of transmitting cost basis
information related to securities accounts that are transferred from
one broker-dealer to another through ACATS should reduce NSCC's
members' administrative burdens and as such should promote the prompt
and accurate clearance and settlement of securities transactions.
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\4\ 15 U.S.C. 78q-1(b)(3)(F).
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NSCC has requested that the Commission find good cause for
approving the proposed rule change prior to the thirtieth day after the
date of publication of notice of filing. The Commission finds good
cause for approving the proposed rule change prior to the thirtieth day
after the date of publication of notice of filing because such approval
will allow NSCC to implement this new service in time for it to provide
benefits for brokers, dealers, and investors for the current tax filing
period and will also enable NSCC to implement CBRS 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 5th Street NW., Washington, DC 20549-0069.
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-NSCC-2003-02. 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 rule filing that
are filed with the Commission, and all written communications relating
to the rule filing between the Commission and any person, other than
those that may be withheld from the public in accordance with
provisions of 5 U.S.C. 552, will be available for inspection and
copying in the Commission's Public Reference Room in Washington, DC.
Copies of such filing will also be available for inspection and copying
at NSCC's principal office. All submissions should refer to File No.
SR-NSCC-2003-02 and should be submitted by April 29, 2003.
It is therefore ordered, pursuant to Section 19(b)(2) of the Act,
that the proposed rule change (File No. SR-NSCC-2003-02) be, and hereby
is, approved on an accelerated basis.
For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\5\
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\5\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-8444 Filed 4-7-03; 8:45 am]
BILLING CODE 8010-01-P