Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing of a Proposed Rule Change Relating to an Escrow Program Fee To Be Charged to Escrow Banks, 60599-60600 [E6-16948]
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Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Notices
V. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act, that the
proposed rule change (SR–NYSEArca–
2006–64), is hereby approved on an
accelerated basis.35
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.36
J. Lynn Taylor,
Assistant Secretary.
[FR Doc. E6–16952 Filed 10–12–06; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–54572; File No. SR–OCC–
2006–12]
Self-Regulatory Organizations; The
Options Clearing Corporation; Notice
of Filing of a Proposed Rule Change
Relating to an Escrow Program Fee To
Be Charged to Escrow Banks
October 4, 2006.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 notice is hereby given that on
July 12, 2006, The Options Clearing
Corporation (‘‘OCC’’) filed with the
Securities and Exchange 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.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The proposed rule change would
amend OCC’s Schedule of Fees by
adding a $200 escrow fee to be charged
to OCC-approved banks.
ycherry on PROD1PC64 with NOTICES2
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. The self-regulatory
organization has prepared summaries,
set forth in Sections A, B, and C below,
35 15
U.S.C. 78s(b)(2).
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
36 17
VerDate Aug<31>2005
15:21 Oct 12, 2006
Jkt 211001
of the most significant aspects of such
statements.2
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 amend OCC’s Schedule of
Fees by adding a $200 escrow fee to be
charged to OCC-approved banks.
As background, OCC’s escrow deposit
program allows a custodian bank that
has entered into an escrow agreement
with OCC (‘‘escrow bank’’) to make
deposits of eligible collateral on behalf
of its customers with respect to stock
option contracts and index option
contracts carried in short positions and
to rollover and withdraw such deposits
by submitting electronic instructions to
OCC through OCC’s escrow deposit
system.3 Escrow deposits are pledged to
both the customer’s clearing member
and to OCC in order to satisfy the
customer’s obligation to deposit
customer level margin at the clearing
member and in order to satisfy the
clearing member’s obligation to deposit
clearing level margin at OCC with
respect to a specified short position in
stock or index options.4 Under OCC’s
form of escrow agreement, an escrow
bank is obligated to hold the deposited
collateral subject to the lien of OCC and
the clearing member until such liens are
released.
In 2005, the escrow deposit system
was integrated into OCC’s clearing
system, which enabled escrow banks to
access the escrow system through the
internet. Before the integration, escrow
banks were required to lease or buy a
personal computer that was configured
by OCC to provide secure access to the
escrow deposit system. Banks that
elected the lease alternative are charged
a $200.00 monthly fee of which $150.00
is an equipment leasing fee and $50.00
is an access fee.5 Banks that (i) Elected
the purchase alternative or (ii) became
escrow banks after the systems
2 The Commission has modified the text of the
summaries prepared by OCC.
3 Escrow banks also use the escrow deposit
system to receive and review OCC and relevant
clearing member responses and to access reports.
4 Escrow deposits may include: (i) the underlying
securities for any stock option contract; (ii) cash,
short-term U.S. Government securities, and/or
common stocks for any index call option contract;
and (iii) cash and/or short-term U.S. Government
securities for stock or index put options.
5 OCC has continued to charge current escrow
banks with leased equipment the $200.00 per
month total fee as they have retained such
equipment as a back-up to Internet access to the
escrow system. However, a different back-up
solution is being implemented for all escrow banks,
which is rendering the leased equipment obsolete
for purposes of accessing the escrow system.
PO 00000
Frm 00139
Fmt 4703
Sfmt 4703
60599
integration are charged only the $50
access fee, which is intended to cover
the costs associated with administering
the escrow deposit program. Costs to
administer the program include: (1)
Legal costs related to addressing the
contractual aspects of the program; (2)
audit costs related to ensuring
compliance with the external audit
reporting requirements of the program;
and (3) staff costs related to servicing
program users (i.e., escrow banks and
clearing members).
In connection with reviewing
different back-up solutions to Internet
access, OCC also examined its costs to
administer the escrow program and
concluded that the costs greatly exceed
the $50.00 per month access fee.
Accordingly, OCC has determined to
charge all escrow banks a $200.00 per
month escrow program fee, which
would be reflected in OCC’s Schedule of
Fees. The proposed program fee will
allow OCC to partially offset its escrow
program administration costs but will
not affect the overwhelming majority of
escrow banks which already pay
$200.00 per month in aggregate escrow
deposit program fees.
OCC believes that the proposed
change is consistent with Section 17A of
the Act 6 and the rules thereunder
because it amends OCC’s Schedule of
Fees to include a reasonable fee to be
charged to escrow banks that utilize
OCC’s escrow deposit system to
partially offset OCC’s cost to administer
the escrow program. The proposed rule
change is not inconsistent with the
existing rules of OCC including any
other rules proposed to be amended.
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.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
OCC has not solicited or received
written comments with respect to the
proposed rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within 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
6 15
E:\FR\FM\13OCN1.SGM
U.S.C. 78q–1.
13OCN1
60600
Federal Register / Vol. 71, No. 198 / Friday, October 13, 2006 / Notices
(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:
ycherry on PROD1PC64 with NOTICES2
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
No. SR–OCC–2006–12 on the subject
line.
Paper Comments
• Send paper comments in triplicate
to Nancy M. Morris, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File No.
SR–OCC–2006–12. 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 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 OCC’s principal office and on OCC’s
Web site at https://www.theocc.com/
publications/rules/proposed_changes/
proposed_changes.jsp. 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 submission
VerDate Aug<31>2005
15:21 Oct 12, 2006
Jkt 211001
should refer to File No. SR–OCC–2006–
12 and should be submitted on or before
November 3, 2006.
DEPARTMENT OF TRANSPORTATION
For the Commission by the Division of
Market Regulation, pursuant to delegated
authority.7
Nancy M. Morris,
Secretary.
[FR Doc. E6–16948 Filed 10–12–06; 8:45 am]
Notice of Applications for Certificates
of Public Convenience and Necessity
and Foreign Air Carrier Permits Filed
Under Subpart B (formerly Subpart Q)
during the Week Ending September 29,
2006
BILLING CODE 8011–01–P
DEPARTMENT OF STATE
[Public Notice 5565]
Arms Control and Nonproliferation
Advisory Board (ACNAB) Meeting
Notice
Closed Meeting
In accordance with section 10(a)(2) of
the Federal Advisory Committee Act, 5
U.S.C. app 2 § 10(a)(2), the Department
of State announces a meeting of the
Arms Control and Nonproliferation
Advisory Board (ACNAB) to take place
on November 6, 2006, at the Department
of State, Washington, DC.
Pursuant to section 10(d) of the
Federal Advisory Committee Act, 5
U.S.C. app 2 § 10(d) and 5 U.S.C. 552b
(c)(1), it has been determined that this
Board meeting will be closed to the
public in the interest of national defense
and foreign policy because the Board
will be reviewing and discussing
matters classified in accordance with
Executive Order 12958.
The purpose of the ACNAB is to
provide the Department with a
continuing source of independent
advice on all aspects of arms control,
disarmament and international security,
and related aspects of public diplomacy.
The agenda for this meeting includes
classified discussions related to the
Board’s on-going studies on current U.S.
policy and issues regarding the National
Strategy to Combat Weapons of Mass
Destruction, Counter-Terrorism, and
Space Policy.
For more information, contact
Matthew Zartman, Deputy Executive
Director of the Arms Control and
Nonproliferation Advisory Board,
Department of State, Washington, DC
20520, telephone: (202) 736–4244.
Dated: September 29, 2006.
George W. Look,
Executive Director of the Arms Control and
Nonproliferation Advisory Board, Department
of State.
[FR Doc. E6–17022 Filed 10–12–06; 8:45 am]
BILLING CODE 4710–27–P
7 17
PO 00000
CFR 200.30–3(a)(12).
Frm 00140
Fmt 4703
Sfmt 4703
Office of the Secretary
The following Applications for
Certificates of Public Convenience and
Necessity and Foreign Air Carrier
Permits were filed under Subpart B
(formerly Subpart Q) of the Department
of Transportation’s Procedural
Regulations (See 14 CFR 301.201 et
seq.). The due date for Answers,
Conforming Applications, or Motions to
Modify Scope are set forth below for
each application. Following the Answer
period DOT may process the application
by expedited procedures. Such
procedures may consist of the adoption
of a show-cause order, a tentative order,
or in appropriate cases a final order
without further proceedings.
Docket Number: OST–2006–25982.
Date Filed: September 28, 2006.
Due Date for Answers, Conforming
Applications, or Motion to Modify
Scope: October 19, 2006.
Description: Application of Avior
Airlines, C.A. requesting a foreign air
carrier permit in order to engage in
scheduled foreign air transportation of
persons, property and mail between
Venezuela and the United States.
Renee V. Wright
Program Manager, Docket Operations,
Federal Register Liaison.
[FR Doc. E6–16993 Filed 10–12–06; 8:45 am]
BILLING CODE 4910–9X–P
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
[Docket No. FAA–2004–16944]
Operating Limitations at Chicago
O’Hare International Airport; Notice of
Order
Federal Aviation
Administration (FAA), DOT.
ACTION: Notice of Order.
AGENCY:
SUMMARY: On September 22, 2006, the
FAA issued an order to show cause,
which solicited written views on
modifying the August 2004 Order
temporarily limiting scheduled
operations at O’Hare International
Airport (O’Hare) to allow carriers to
trade and transfer scheduled arrivals for
consideration for the remaining
duration of the Order. The FAA is
E:\FR\FM\13OCN1.SGM
13OCN1
]]>Agencies
[Federal Register Volume 71, Number 198 (Friday, October 13, 2006)]
[Notices]
[Pages 60599-60600]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-16948]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-54572; File No. SR-OCC-2006-12]
Self-Regulatory Organizations; The Options Clearing Corporation;
Notice of Filing of a Proposed Rule Change Relating to an Escrow
Program Fee To Be Charged to Escrow Banks
October 4, 2006.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on July 12, 2006, The Options
Clearing Corporation (``OCC'') filed with the Securities and Exchange
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.
---------------------------------------------------------------------------
\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 amend OCC's Schedule of Fees by
adding a $200 escrow fee to be charged to OCC-approved banks.
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. The self-regulatory organization 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 OCC.
---------------------------------------------------------------------------
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 amend OCC's Schedule
of Fees by adding a $200 escrow fee to be charged to OCC-approved
banks.
As background, OCC's escrow deposit program allows a custodian bank
that has entered into an escrow agreement with OCC (``escrow bank'') to
make deposits of eligible collateral on behalf of its customers with
respect to stock option contracts and index option contracts carried in
short positions and to rollover and withdraw such deposits by
submitting electronic instructions to OCC through OCC's escrow deposit
system.\3\ Escrow deposits are pledged to both the customer's clearing
member and to OCC in order to satisfy the customer's obligation to
deposit customer level margin at the clearing member and in order to
satisfy the clearing member's obligation to deposit clearing level
margin at OCC with respect to a specified short position in stock or
index options.\4\ Under OCC's form of escrow agreement, an escrow bank
is obligated to hold the deposited collateral subject to the lien of
OCC and the clearing member until such liens are released.
---------------------------------------------------------------------------
\3\ Escrow banks also use the escrow deposit system to receive
and review OCC and relevant clearing member responses and to access
reports.
\4\ Escrow deposits may include: (i) the underlying securities
for any stock option contract; (ii) cash, short-term U.S. Government
securities, and/or common stocks for any index call option contract;
and (iii) cash and/or short-term U.S. Government securities for
stock or index put options.
---------------------------------------------------------------------------
In 2005, the escrow deposit system was integrated into OCC's
clearing system, which enabled escrow banks to access the escrow system
through the internet. Before the integration, escrow banks were
required to lease or buy a personal computer that was configured by OCC
to provide secure access to the escrow deposit system. Banks that
elected the lease alternative are charged a $200.00 monthly fee of
which $150.00 is an equipment leasing fee and $50.00 is an access
fee.\5\ Banks that (i) Elected the purchase alternative or (ii) became
escrow banks after the systems integration are charged only the $50
access fee, which is intended to cover the costs associated with
administering the escrow deposit program. Costs to administer the
program include: (1) Legal costs related to addressing the contractual
aspects of the program; (2) audit costs related to ensuring compliance
with the external audit reporting requirements of the program; and (3)
staff costs related to servicing program users (i.e., escrow banks and
clearing members).
---------------------------------------------------------------------------
\5\ OCC has continued to charge current escrow banks with leased
equipment the $200.00 per month total fee as they have retained such
equipment as a back-up to Internet access to the escrow system.
However, a different back-up solution is being implemented for all
escrow banks, which is rendering the leased equipment obsolete for
purposes of accessing the escrow system.
---------------------------------------------------------------------------
In connection with reviewing different back-up solutions to
Internet access, OCC also examined its costs to administer the escrow
program and concluded that the costs greatly exceed the $50.00 per
month access fee. Accordingly, OCC has determined to charge all escrow
banks a $200.00 per month escrow program fee, which would be reflected
in OCC's Schedule of Fees. The proposed program fee will allow OCC to
partially offset its escrow program administration costs but will not
affect the overwhelming majority of escrow banks which already pay
$200.00 per month in aggregate escrow deposit program fees.
OCC believes that the proposed change is consistent with Section
17A of the Act \6\ and the rules thereunder because it amends OCC's
Schedule of Fees to include a reasonable fee to be charged to escrow
banks that utilize OCC's escrow deposit system to partially offset
OCC's cost to administer the escrow program. The proposed rule change
is not inconsistent with the existing rules of OCC including any other
rules proposed to be amended.
---------------------------------------------------------------------------
\6\ 15 U.S.C. 78q-1.
---------------------------------------------------------------------------
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.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
OCC has not solicited or received written comments with respect to
the proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 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
[[Page 60600]]
(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 (https://
www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File No. SR-OCC-2006-12 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File No. SR-OCC-2006-12. 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 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 OCC's principal office and on OCC's Web
site at https://www.theocc.com/publications/rules/proposed_changes/
proposed_changes.jsp. 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 submission should refer to File No. SR-
OCC-2006-12 and should be submitted on or before November 3, 2006.
---------------------------------------------------------------------------
\7\ 17 CFR 200.30-3(a)(12).
For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\7\
Nancy M. Morris,
Secretary.
[FR Doc. E6-16948 Filed 10-12-06; 8:45 am]
BILLING CODE 8011-01-P
