Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Establish an Insurance Program as Part of the Profile Modification System Feature of Its Direct Registration System, 55196-55197 [05-18668]

Download as PDF 55196 Federal Register / Vol. 70, No. 181 / Tuesday, September 20, 2005 / Notices comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (https://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, 100 F Street, NE., Washington, DC 20549. Copies of such filing also will be available for inspection and copying at the principal office of the CBOE. 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–CBOE–2005–76 and should be submitted on or before October 11, 2005. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.13 Jonathan G. Katz, Secretary. [FR Doc. 05–18674 Filed 9–19–05; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–52422; No. SR–DTC–2005– 11] Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Establish an Insurance Program as Part of the Profile Modification System Feature of Its Direct Registration System September 14, 2005. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 notice is hereby given that on August 22, 2005, The Depository Trust Company (‘‘DTC’’) filed with the Securities and Exchange Commission (‘‘Commission’’) and on August 22, 2005, amended 2 the rule change described in Items I, II, and III below, 13 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 The amendment corrected a pagination error in the original filing. which items have been prepared primarily by DTC. The Commission is publishing this notice to solicit comments on the rule change from interested parties. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The rule change establishes an insurance program as part of DTC’s Profile Modification System (‘‘Profile’’) of its Direct Registration System (‘‘DRS’’). II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, DTC included statements concerning the purpose of and basis for the rule change and discussed any comments it received on the 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 (A) Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change Currently, Profile allows a DTC participant to submit electronically to a transfer agent that is a DRS limited participant an investor’s instruction that its share positions be moved from the investor’s DRS account with the DRS limited participant to the investor’s broker-dealer’s participant account at DTC. Similarly, a DRS limited participant may submit an investor’s instruction for the movement of its share positions from the investor’s broker-dealer’s participant account at DTC to an account maintained by the DRS limited participant. Currently, all Profile users must agree to a Participant Terminal System (‘‘PTS’’) screen indemnity as part of their use of Profile and must procure a surety bond relating to their obligations under such indemnity (‘‘Surety Program’’). Participation in the Surety Program requires the payment of an annual premium of $3,150 to a surety provider and a DTC administration fee of $250. The Surety Program provides for a coverage limit of $3 million per occurrence and an annual aggregate limit of $6 million. DTC believes the cost of the annual surety and the coverage limit may be a 1 15 VerDate Aug<31>2005 14:53 Sep 19, 2005 Jkt 205001 3 The Commission has modified the text of the summaries prepared by DTC. PO 00000 Frm 00097 Fmt 4703 Sfmt 4703 disincentive for some to use Profile. In order to encourage greater participation in the service, DTC proposes the implementation of the DTC Profile Modification System Indemnity Insurance Program (‘‘Insurance Program’’). Under the Insurance Program, Profile users will have the option to procure indemnity insurance with higher coverage limits ($25 million per occurrence per policy with an annual aggregate limit of $100 million) than the surety bond under the Surety Program provides, which will allow larger transactions to be covered under one policy. Furthermore, Profile users will have the option to procure indemnity insurance at an annual fee that is less than the premium for the Surety Program. In addition to any passthrough fee from the insurer, DTC will charge users participating in the Insurance Program an annual administration fee of $250 and a $2.50 per transaction fee. Users will be able to participate in both the Surety Program and the Insurance Program but would be required and permitted to use only one provider per Profile transaction. The issuing insurance company will be either a company selected by DTC as the administrator of such insurance or an insurance company selected by the user procuring the insurance, provided the insurance company will issue insurance subject to the terms and conditions established by DTC for the Insurance Program. DTC believes the rule change is consistent with Section 17A of the Act,4 as amended, because it is a modification of a DTC service that enhances the safeguards for transactions processed in the service. As such it is a change to an existing service that will not adversely affect the safeguarding of securities and funds in DTC’s custody or control. (B) Self-Regulatory Organization’s Statement on Burden on Competition DTC does not believe that the 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 rule change have not yet been solicited or received. DTC will notify the Commission of any written comments it receives. 4 15 E:\FR\FM\20SEN1.SGM U.S.C. 78q–1. 20SEN1 Federal Register / Vol. 70, No. 181 / Tuesday, September 20, 2005 / Notices 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 5 and Rule 19b–4(f)(4) 6 thereunder because it does not adversely affect the safeguarding of securities or funds in the custody or control of DTC or for which it is responsible and does not significantly affect the respective rights or obligations of the clearing agency or persons using the service. At any time within sixty days of the filing of the 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. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the 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 (https://www.sec.gov/ rules/sro.shtml) or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–DTC–2005–11 on the subject line. Paper Comments • Send paper comments in triplicate to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–9303. All submissions should refer to File Number SR–DTC–2005–11. 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 (https://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the rule change that are filed with the Commission, and all written communications relating to the 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 5 15 6 17 U.S.C. 78s(b)(3)(A)(iii). CFR 240.19b–4(f)(4). VerDate Aug<31>2005 14:53 Sep 19, 2005 Jkt 205001 U.S.C. 552, will be available for inspection and copying in the Commission’s Public Reference Section, 100 F Street, NE., Washington, DC 20549. Copies of such filings also will be available for inspection and copying at the principal office of DTC and on DTC’s Web site at https:// login.dtcc.com/dtcorg/. 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–DTC– 2005–11 and should be submitted on or before October 11, 2005. For the Commission by the Division of Market Regulation, pursuant to delegated authority.7 Jonathan G. Katz, Secretary. [FR Doc. 05–18668 Filed 9–19–05; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–52418; File No. SR–ISE– 2005–33] Self-Regulatory Organizations; International Securities Exchange, Inc.; Order Approving a Proposed Rule Change To Amend the Exchange’s Trade-Through and Locked Markets Rules September 13, 2005. On July 8, 2005, the International Securities Exchange, Inc. (‘‘ISE’’), filed with the Securities and Exchange Commission (‘‘Commission’’) a proposed rule change pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 to implement Amendment No. 15 to the Plan for the Purpose of Creating and Operating an Intermarket Option Linkage 3 by 7 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 On July 28, 2000, the Commission approved a national market system plan for the purpose of creating and operating an intermarket option linkage proposed by the American Stock Exchange LLC, the Chicago Board Options Exchange, Incorporated, and the ISE. See Securities Exchange Act Release No. 43086 (July 28, 2000), 65 FR 48023 (August 4, 2000) (‘‘Linkage Plan’’). Subsequently, upon separate requests by the Philadelphia Stock Exchange, Inc., the Pacific Exchange, Inc., and the Boston Stock Exchange, Inc., the Commission issued orders to permit these exchanges to participate in the Linkage Plan. See Securities Exchange Act Release Nos. 43573 (November 16, 2000), 65 FR 70851 (November 28, 2000); 43574 (November 16, 2000), 65 FR 70850 (November 28, 1 15 PO 00000 Frm 00098 Fmt 4703 Sfmt 4703 55197 amending ISE Rules 1900 and 1903 to add a ‘‘trade and ship’’ exception to the definition of ‘‘Trade-Through’’ and add a ‘‘book and ship’’ exception to the provision relating to locked markets, respectively. The proposed rule change was published for comment in the Federal Register on August 5, 2005.4 The Commission received no comments on the proposal. This order approves the proposed rule change. Under the proposed rule change, an ISE member could trade an order at a price that is one minimum quoting increment inferior to the national best bid or offer (‘‘NBBO’’) if a Linkage Order 5 is sent contemporaneously to the market(s) disseminating the NBBO to satisfy all interest at the NBBO price. The proposed rule change also would provide that an ISE member may enter an order on the ISE that would otherwise lock another market if a Linkage Order is sent contemporaneously to such other market to satisfy all interest at the lock price and only the remaining portion of the order is booked. The ISE proposes that, under trade and ship, any execution received from the market disseminating the NBBO must (pursuant to agency obligations) be reassigned to the customer order that is underlying the Linkage Order that was sent to trade with the market disseminating the NBBO. After careful consideration, the Commission finds that the proposed rule change is consistent with the requirements of Section 6 of the Act 6 and the rules and regulations thereunder applicable to a national securities exchange.7 In particular, the Commission finds that the proposed rule change is consistent with Section 6(b)(5) of the Act,8 which requires, among other things, that the rules of an exchange be designed to promote just and equitable principles of trade, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest. The Commission believes that the proposed rule change should help to implement the Linkage Plan by facilitating the ability of ISE’s members to execute their customer 2000); and 49198 (February 5, 2004), 69 FR 7029 (February 12, 2004). 4 See Securities Exchange Act Release No. 52174 (July 29, 2005), 70 FR 45455. 5 See ISE Rule 1900(10). 6 15 U.S.C. 78f. 7 In approving this proposal, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 8 15 U.S.C. 78f(b)(5). E:\FR\FM\20SEN1.SGM 20SEN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 70, Number 181 (Tuesday, September 20, 2005)]
[Notices]
[Pages 55196-55197]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-18668]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-52422; No. SR-DTC-2005-11]


Self-Regulatory Organizations; The Depository Trust Company; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Establish an Insurance Program as Part of the Profile Modification 
System Feature of Its Direct Registration System

September 14, 2005.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on August 22, 2005, The 
Depository Trust Company (``DTC'') filed with the Securities and 
Exchange Commission (``Commission'') and on August 22, 2005, amended 
\2\ the rule change 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 rule change from interested 
parties.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ The amendment corrected a pagination error in the original 
filing.
---------------------------------------------------------------------------

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

    The rule change establishes an insurance program as part of DTC's 
Profile Modification System (``Profile'') of its Direct Registration 
System (``DRS'').

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

    In its filing with the Commission, DTC included statements 
concerning the purpose of and basis for the rule change and discussed 
any comments it received on the 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\
---------------------------------------------------------------------------

    \3\ The Commission has modified the text of the summaries 
prepared by DTC.
---------------------------------------------------------------------------

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

    Currently, Profile allows a DTC participant to submit 
electronically to a transfer agent that is a DRS limited participant an 
investor's instruction that its share positions be moved from the 
investor's DRS account with the DRS limited participant to the 
investor's broker-dealer's participant account at DTC. Similarly, a DRS 
limited participant may submit an investor's instruction for the 
movement of its share positions from the investor's broker-dealer's 
participant account at DTC to an account maintained by the DRS limited 
participant.
    Currently, all Profile users must agree to a Participant Terminal 
System (``PTS'') screen indemnity as part of their use of Profile and 
must procure a surety bond relating to their obligations under such 
indemnity (``Surety Program''). Participation in the Surety Program 
requires the payment of an annual premium of $3,150 to a surety 
provider and a DTC administration fee of $250. The Surety Program 
provides for a coverage limit of $3 million per occurrence and an 
annual aggregate limit of $6 million.
    DTC believes the cost of the annual surety and the coverage limit 
may be a disincentive for some to use Profile. In order to encourage 
greater participation in the service, DTC proposes the implementation 
of the DTC Profile Modification System Indemnity Insurance Program 
(``Insurance Program''). Under the Insurance Program, Profile users 
will have the option to procure indemnity insurance with higher 
coverage limits ($25 million per occurrence per policy with an annual 
aggregate limit of $100 million) than the surety bond under the Surety 
Program provides, which will allow larger transactions to be covered 
under one policy. Furthermore, Profile users will have the option to 
procure indemnity insurance at an annual fee that is less than the 
premium for the Surety Program. In addition to any pass-through fee 
from the insurer, DTC will charge users participating in the Insurance 
Program an annual administration fee of $250 and a $2.50 per 
transaction fee. Users will be able to participate in both the Surety 
Program and the Insurance Program but would be required and permitted 
to use only one provider per Profile transaction.
    The issuing insurance company will be either a company selected by 
DTC as the administrator of such insurance or an insurance company 
selected by the user procuring the insurance, provided the insurance 
company will issue insurance subject to the terms and conditions 
established by DTC for the Insurance Program.
    DTC believes the rule change is consistent with Section 17A of the 
Act,\4\ as amended, because it is a modification of a DTC service that 
enhances the safeguards for transactions processed in the service. As 
such it is a change to an existing service that will not adversely 
affect the safeguarding of securities and funds in DTC's custody or 
control.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78q-1.
---------------------------------------------------------------------------

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

    DTC does not believe that the 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 rule change have not yet been 
solicited or received. DTC will notify the Commission of any written 
comments it receives.

[[Page 55197]]

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 \5\ and Rule 19b-4(f)(4) \6\ 
thereunder because it does not adversely affect the safeguarding of 
securities or funds in the custody or control of DTC or for which it is 
responsible and does not significantly affect the respective rights or 
obligations of the clearing agency or persons using the service. At any 
time within sixty days of the filing of the 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.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \6\ 17 CFR 240.19b-4(f)(4).
---------------------------------------------------------------------------

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the 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 (https://
www.sec.gov/rules/sro.shtml) or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-DTC-2005-11 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-9303.
    All submissions should refer to File Number SR-DTC-2005-11. 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 (https://www.sec.gov/
rules/sro.shtml). Copies of the submission, all subsequent amendments, 
all written statements with respect to the rule change that are filed 
with the Commission, and all written communications relating to the 
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, 100 F Street, NE., Washington, 
DC 20549. Copies of such filings also will be available for inspection 
and copying at the principal office of DTC and on DTC's Web site at 
https://login.dtcc.com/dtcorg/. 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-DTC-2005-11 and should be submitted on or before October 
11, 2005.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\7\
---------------------------------------------------------------------------

    \7\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Jonathan G. Katz,
Secretary.
[FR Doc. 05-18668 Filed 9-19-05; 8:45 am]
BILLING CODE 8010-01-P

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