Self-Regulatory Organizations; Fixed Income Clearing Corporation; Notice of Filing of Proposed Rule Change To Modify the Hearing Procedures Afforded to Members and Applicants for Membership and Harmonize Them With Similar Rules of Its Affiliates, 68922-68924 [E7-23592]
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68922
Federal Register / Vol. 72, No. 234 / Thursday, December 6, 2007 / Notices
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–2007–06 on the
subject line.
mstockstill on PROD1PC66 with NOTICES
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
Number SR–DTC–2007–06. 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 on official business days
between the hours of 10 a.m. and 3 p.m.
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://www.dtcc.com/
downloads/legal/rule_filings/2007/dtc/
2007–06.pdf. 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–
2007–06 and should be submitted on or
before December 21, 2007.
For the Commission by the Division of
Trading and Markets, pursuant to delegated
authority.8
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7–23591 Filed 12–5–07; 8:45 am]
BILLING CODE 8011–01–P
8 17
18:57 Dec 05, 2007
and (C) below, of the most significant
aspects of these statements.4
[Release No. 34–56864; File No. SR–FICC–
2007–06]
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
Self-Regulatory Organizations; Fixed
Income Clearing Corporation; Notice of
Filing of Proposed Rule Change To
Modify the Hearing Procedures
Afforded to Members and Applicants
for Membership and Harmonize Them
With Similar Rules of Its Affiliates
November 29, 2007.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
notice is hereby given that on April 30,
2007, the Fixed Income Clearing
Corporation (‘‘FICC’’) filed with the
Securities and Exchange Commission
(‘‘Commission’’) and on July 24, 2007,
amended 3 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.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The proposed rule change seeks (1) to
modify the rules of FICC’s Government
Securities Division (‘‘GSD’’) and
Mortgage-Backed Securities Division
(‘‘MBSD’’) (GSD and MBSD are
collectively referred to as the
‘‘Divisions’’), including the EPN rules of
MBSD, regarding hearing procedures
afforded to members and applicants for
membership and (2) where practicable
or beneficial, to harmonize them with
similar rules of FICC’s affiliates, The
Depository Trust Company (‘‘DTC’’) and
the National Securities Clearing
Corporation (‘‘NSCC’’).
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),
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 The amendment corrected a typographical error
in the proposed rule text.
2 17
CFR 200.30–3(a)(12).
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SECURITIES AND EXCHANGE
COMMISSION
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1. Minor Rule Violation Plan
In 1984, the Commission adopted
amendments to Rule 19d–1(c) under the
Act 5 that allow self-regulatory
organizations to adopt with Commission
approval plans for the disposition of
minor violations of rules.6
Currently under each Division’s rules,
a member or applicant subject to
disciplinary action has a right to a
hearing before a panel comprised of
members of FICC’s Board of Directors
regardless of the severity of the action
for which the member or applicant is
being disciplined.7 Because some rule
violations are not sufficiently serious to
merit Board review, FICC is proposing
to adopt a Minor Rule Violation Plan
within the meaning of Rule 19d–1(c)(2)
of the Act for those rule violations FICC
deems minor. Consistent with Rule
19d–1(c)(2) of the Act, FICC would
designate those rule violations for
which a fine may be assessed in an
amount not to exceed $5,000 as minor
rule violations. If a member were to
dispute a fine imposed by FICC by filing
a written request for hearing and a
written statement, FICC management
would have the authority to waive the
fine. FICC management would notify the
Board of Directors (or a Committee
authorized by the Board of Directors) of
its determination to waive the fine and
would provide the reasons for the
waiver. The Board or Committee could
in its discretion decide to reinstate any
fine waived by FICC management. If
FICC management were not to waive the
fine, the member could appeal the
decision to a panel comprised of FICC
officers (‘‘Minor Rule Violation Panel’’).
2. Hearings for All Other Violations and
Minor Rule Violation Appeals
For matters involving (i) an alleged
violation of a GSD or MBSD rule for
which a fine in an amount of over
$5,000 is assessed, (ii) applicants for
membership, or (iii) other disciplinary
actions to which the Minor Rule
Violation Plan would not apply or for
appeals from a Minor Rule Violation
4 The Commission has modified the text of the
summaries prepared by FICC.
5 17 CFR 240.19d–1(c).
6 Securities Exchange Act Release No. 21013
(June 1, 1984), 49 FR 23828 (June 8, 1984) File No.
S7–983A].
7 MBSD Article V, Rule 7 (‘‘Appeals’’); EPN
Article X, Rule 7 (‘‘Appeals’’); and GSD Rule 37
(‘‘Hearing Procedures’’).
E:\FR\FM\06DEN1.SGM
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Federal Register / Vol. 72, No. 234 / Thursday, December 6, 2007 / Notices
Panel decision adverse to a member or
applicant, the member or applicant
would be entitled to a hearing before a
panel comprised of three individuals of
the FICC Board of Directors (or their
designees) appointed by the Chairman
of the FICC Board. Decisions of the
panel would be final; however, the full
Board of Directors would retain the right
to modify any sanction or reverse any
decision of the Board panel that was
adverse to the member or applicant.
Currently with respect to hearings, a
member or applicant is afforded the
opportunity to be heard and may be
represented by counsel if desired. A
record is kept of the hearing, and at the
discretion of the Board panel, the
associated cost may be charged in whole
or part to the member or applicant in
the event that the decision is adverse to
the member or applicant. The member
or applicant is advised of the Board
panel’s decision within ten business
days after the conclusion of the hearing.
These procedures would also apply
with respect to the Minor Rule Violation
Plan.
mstockstill on PROD1PC66 with NOTICES
3. Administrative Changes: Uniformity
of Time Frames
The proposed rule changes seek to
implement uniform time periods for the
Divisions governing actions a member
or applicant would be required to take
in order to request a hearing. The
deadlines a member or applicant must
adhere to in order to request a hearing
currently vary between the Divisions.
Under the proposed rule change, a
member or applicant would have five
business days, or two business days in
the case of a summary action taken
against the member or applicant
pursuant to Rule 21 or 22,8 from the
date on which FICC first informs it of a
sanction or a denial of membership in
which to request a hearing.
Within seven business days, or three
business days in the case of a summary
action taken against the member or
applicant, after filing a request for a
hearing with FICC, the member or
applicant would be required to submit
to FICC a clear and concise written
statement setting forth the action or
proposed action of FICC with respect to
which the hearing is requested, the basis
for objection to such action, whether the
member or applicant intends to attend
the hearing, and whether the member or
applicant chooses to be represented by
counsel at the hearing. These proposed
time frames would be consistent with
8 Examples of a summary action are a suspension
of a member or restriction of a member’s access to
services as described in Rule 21, Section 1
(‘‘Restrictions on Access to Services’’).
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18:57 Dec 05, 2007
Jkt 214001
time frames being proposed by DTC and
NSCC.
4. Technical Changes
MBSD Article V, Rule 3 (‘‘Fines and
Other Sanctions’’) would be amended in
accordance with the proposed changes
to the hearing procedures of MBSD.
In addition, minor technical changes
would be made to the rules of both
Divisions where necessary to implement
the proposed changes set forth above.
5. Implementation of the Proposed
Changes
The proposed changes will be
implemented upon approval of this
proposed filing by the Commission.
Members will be advised of the
implementation through an FICC
Important Notice.
FICC believes that the proposed rule
change is consistent with the
requirements of Section 17A of the Act 9
and the rules and regulations
thereunder because the adoption of a
Minor Rule Violation Plan furthers the
statutory objective of providing a fair
procedure for disciplining members and
will provide FICC with the ability to
impose meaningful sanctions for those
rule violations that do not necessarily
rise to a level meriting a full
disciplinary proceeding. Accordingly,
the proposed rule change promotes the
prompt and accurate clearance and
settlement of securities transactions.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
FICC does not believe that the
proposed 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
proposed rule change have not been
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
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 (ii) as to which the self-regulatory
organization consents, the Commission
will:
9 15
PO 00000
U.S.C. 78q–1.
Frm 00067
Fmt 4703
Sfmt 4703
68923
(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 rulecomments@sec.gov. Please include File
Number SR–FICC–2007–06 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
Number SR–FICC–2007–06. 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, on official business days
between the hours of 10 a.m. and 3 p.m.
Copies of such filings also will be
available for inspection and copying at
the principal office of FICC and on
FICC’s Web site at https://www.dtcc.com/
downloads/legal/rule_filings/2007/ficc/
2007–06.pdf. 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–FICC–
E:\FR\FM\06DEN1.SGM
06DEN1
68924
Federal Register / Vol. 72, No. 234 / Thursday, December 6, 2007 / Notices
2007–06 and should be submitted on or
before December 21, 2007.
For the Commission by the Division of
Trading and Markets, pursuant to delegated
authority.10
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7–23592 Filed 12–5–07; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–56871; File No. SR–ISE–
2007–87]
Self-Regulatory Organizations;
International Securities Exchange,
LLC; Notice of Filing and Order
Granting Accelerated Approval of
Proposed Rule Change Relating to the
Criteria for Securities That Underlie
Options Traded on the Exchange
November 30, 2007.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on November
29, 2007, the International Securities
Exchange, LLC (‘‘ISE’’ or ‘‘Exchange’’)
filed with the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I and II below, which Items have
been substantially prepared by the
Exchange. This order provides notice of
the proposed rule change and approves
the proposed rule change on an
accelerated basis.
mstockstill on PROD1PC66 with NOTICES
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The ISE proposes to permit the initial
and continued listing and trading on the
Exchange of options on Index Multiple
Exchange Traded Fund Shares (‘‘Index
Multiple ETFs’’) and Index Inverse
Exchange Traded Fund Shares (‘‘Index
Inverse ETFs’’). The text of the proposed
rule change is available at (https://
www.ise.com), at the Exchange, and at
the Commission’s Public Reference
Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
10 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
VerDate Aug<31>2005
18:57 Dec 05, 2007
Jkt 214001
proposed rule change. The text of these
statements may be examined at the
places specified in Item III below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The purpose of the proposed rule
change is to amend ISE Rules 502 and
503 to enable the listing and trading on
the Exchange of options on Index
Multiple ETFs and Index Inverse ETFs.
Index Multiple ETFs seek to provide
investment results, before fees and
expenses, that correspond to a specified
multiple of the percentage performance
on a given day of a particular foreign or
domestic stock index. Index Inverse
ETFs seek to provide investment results,
before fees and expenses, that
correspond to the inverse (opposite) of
the percentage performance on a given
day of a particular foreign or domestic
stock index by a specified multiple.
Index Multiple ETFs and Index Inverse
ETFs differ from traditional exchangetraded funds (‘‘ETFs’’) in that they do
not merely correspond to the
performance of a given index, but rather
attempt to match a multiple or inverse
of such underlying index performance.
The ProShares Ultra Funds, which
currently trades on the American Stock
Exchange (‘‘Amex’’), is an example of an
Index Multiple ETF. Amex also
currently lists for trading Index Inverse
ETFs, namely the Short Funds and the
UltraShort Funds.3
In order to achieve investment results
that provide either a positive multiple
or inverse of the benchmark index,
Index Multiple ETFs or Index Inverse
ETFs may hold a combination of
financial instruments, including, among
3 See Securities Exchange Act Release Nos. 52553
(October 3, 2005), 70 FR 59100 (October 11, 2005)
(SR–Amex–2004–62) (approving the listing and
trading of the Ultra Funds and Short Funds) and
54040 (June 23, 2006), 71 FR 37629 (June 30, 2006)
(SR–Amex–2006–41) (approving the listing and
trading of the UltraShort Funds). The Ultra Funds
are expected to gain, on a percentage basis,
approximately twice (200%) as much as the
underlying benchmark index and should lose
approximately twice (200%) as much as the
underlying benchmark index when such prices
decline. The Short Funds are expected to achieve
investment results, before fees and expenses, that
correspond to the inverse or opposite of the daily
performance (¥100%) of an underlying benchmark
index. Lastly, the UltraShort Funds are expected to
achieve investment results, before fees and
expenses, that correspond to twice the inverse or
opposite of the daily performance (¥200%) of the
underlying benchmark index.
PO 00000
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other things, stock index futures
contracts; options on futures; options on
securities and indices; equity caps,
collars and floors; swap agreements;
forward contracts; repurchase
agreements; and reverse repurchase
agreements (the ‘‘Financial
Instruments’’). The underlying
portfolios of Index Multiple ETFs
generally will hold at least 85% of their
assets in the component securities of the
underlying relevant benchmark index.
The remainder of any assets is devoted
to Financial Instruments that are
intended to create the additional needed
exposure to such underlying index
necessary to pursue its investment
objective. Normally, 100% of the value
of the underlying portfolios of Index
Inverse ETFs will be devoted to
Financial Instruments and money
market instruments, including U.S.
government securities and repurchase
agreements (the ‘‘Money Market
Instruments’’).
Currently, ISE Rule 502(h) provides
securities deemed appropriate for
options trading shall include shares or
other securities (‘‘Fund Shares’’) 4 that
(i) represent interests in registered
investment companies (or series thereof)
organized as open-end management
investment companies, unit investment
trusts or similar entities that are traded
on a national securities exchange or
through the facilities of a national
securities association and are defined as
an ‘‘NMS stock’’ under Rule 600 of
Regulation NMS, and that hold
portfolios of securities comprising or
otherwise based on or representing
investments in broad-based indexes or
portfolios of securities (or that hold
securities in one or more other
registered investment companies that
themselves hold such portfolios of
securities); or (ii) represent interests in
a trust that holds a specified non-U.S.
currency deposited with the trust when
aggregated in some specified minimum
number may be surrendered to the trust
by the beneficial owner to receive the
specified non-U.S. currency and pays
the beneficial owner interest and other
distributions on the deposited non-U.S.
currency, if any, declared and paid by
the trust (‘‘Funds’’); or (iii) represent
commodity pool interests principally
engaged, directly or indirectly, in
holding and/or managing portfolios or
baskets of securities, commodity futures
contracts, options on commodity futures
contracts, swaps, forward contracts and/
4 ISE also proposes to make technical conforming
changes to its current ISE Rules 502(h) and 503(h)
to those of the Amex. As a result, and in the context
of this filing, the Exchange refers to Fund Shares
as Exchange-Traded Fund Shares hereafter.
E:\FR\FM\06DEN1.SGM
06DEN1
]]>Agencies
[Federal Register Volume 72, Number 234 (Thursday, December 6, 2007)]
[Notices]
[Pages 68922-68924]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-23592]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-56864; File No. SR-FICC-2007-06]
Self-Regulatory Organizations; Fixed Income Clearing Corporation;
Notice of Filing of Proposed Rule Change To Modify the Hearing
Procedures Afforded to Members and Applicants for Membership and
Harmonize Them With Similar Rules of Its Affiliates
November 29, 2007.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on April 30, 2007, the Fixed Income Clearing Corporation (``FICC'')
filed with the Securities and Exchange Commission (``Commission'') and
on July 24, 2007, amended \3\ 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ The amendment corrected a typographical error in the
proposed rule text.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The proposed rule change seeks (1) to modify the rules of FICC's
Government Securities Division (``GSD'') and Mortgage-Backed Securities
Division (``MBSD'') (GSD and MBSD are collectively referred to as the
``Divisions''), including the EPN rules of MBSD, regarding hearing
procedures afforded to members and applicants for membership and (2)
where practicable or beneficial, to harmonize them with similar rules
of FICC's affiliates, The Depository Trust Company (``DTC'') and the
National Securities Clearing Corporation (``NSCC'').
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\
---------------------------------------------------------------------------
\4\ The Commission has modified the text of the summaries
prepared by FICC.
---------------------------------------------------------------------------
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Minor Rule Violation Plan
In 1984, the Commission adopted amendments to Rule 19d-1(c) under
the Act \5\ that allow self-regulatory organizations to adopt with
Commission approval plans for the disposition of minor violations of
rules.\6\
---------------------------------------------------------------------------
\5\ 17 CFR 240.19d-1(c).
\6\ Securities Exchange Act Release No. 21013 (June 1, 1984), 49
FR 23828 (June 8, 1984) File No. S7-983A].
---------------------------------------------------------------------------
Currently under each Division's rules, a member or applicant
subject to disciplinary action has a right to a hearing before a panel
comprised of members of FICC's Board of Directors regardless of the
severity of the action for which the member or applicant is being
disciplined.\7\ Because some rule violations are not sufficiently
serious to merit Board review, FICC is proposing to adopt a Minor Rule
Violation Plan within the meaning of Rule 19d-1(c)(2) of the Act for
those rule violations FICC deems minor. Consistent with Rule 19d-
1(c)(2) of the Act, FICC would designate those rule violations for
which a fine may be assessed in an amount not to exceed $5,000 as minor
rule violations. If a member were to dispute a fine imposed by FICC by
filing a written request for hearing and a written statement, FICC
management would have the authority to waive the fine. FICC management
would notify the Board of Directors (or a Committee authorized by the
Board of Directors) of its determination to waive the fine and would
provide the reasons for the waiver. The Board or Committee could in its
discretion decide to reinstate any fine waived by FICC management. If
FICC management were not to waive the fine, the member could appeal the
decision to a panel comprised of FICC officers (``Minor Rule Violation
Panel'').
---------------------------------------------------------------------------
\7\ MBSD Article V, Rule 7 (``Appeals''); EPN Article X, Rule 7
(``Appeals''); and GSD Rule 37 (``Hearing Procedures'').
---------------------------------------------------------------------------
2. Hearings for All Other Violations and Minor Rule Violation Appeals
For matters involving (i) an alleged violation of a GSD or MBSD
rule for which a fine in an amount of over $5,000 is assessed, (ii)
applicants for membership, or (iii) other disciplinary actions to which
the Minor Rule Violation Plan would not apply or for appeals from a
Minor Rule Violation
[[Page 68923]]
Panel decision adverse to a member or applicant, the member or
applicant would be entitled to a hearing before a panel comprised of
three individuals of the FICC Board of Directors (or their designees)
appointed by the Chairman of the FICC Board. Decisions of the panel
would be final; however, the full Board of Directors would retain the
right to modify any sanction or reverse any decision of the Board panel
that was adverse to the member or applicant.
Currently with respect to hearings, a member or applicant is
afforded the opportunity to be heard and may be represented by counsel
if desired. A record is kept of the hearing, and at the discretion of
the Board panel, the associated cost may be charged in whole or part to
the member or applicant in the event that the decision is adverse to
the member or applicant. The member or applicant is advised of the
Board panel's decision within ten business days after the conclusion of
the hearing. These procedures would also apply with respect to the
Minor Rule Violation Plan.
3. Administrative Changes: Uniformity of Time Frames
The proposed rule changes seek to implement uniform time periods
for the Divisions governing actions a member or applicant would be
required to take in order to request a hearing. The deadlines a member
or applicant must adhere to in order to request a hearing currently
vary between the Divisions. Under the proposed rule change, a member or
applicant would have five business days, or two business days in the
case of a summary action taken against the member or applicant pursuant
to Rule 21 or 22,\8\ from the date on which FICC first informs it of a
sanction or a denial of membership in which to request a hearing.
---------------------------------------------------------------------------
\8\ Examples of a summary action are a suspension of a member or
restriction of a member's access to services as described in Rule
21, Section 1 (``Restrictions on Access to Services'').
---------------------------------------------------------------------------
Within seven business days, or three business days in the case of a
summary action taken against the member or applicant, after filing a
request for a hearing with FICC, the member or applicant would be
required to submit to FICC a clear and concise written statement
setting forth the action or proposed action of FICC with respect to
which the hearing is requested, the basis for objection to such action,
whether the member or applicant intends to attend the hearing, and
whether the member or applicant chooses to be represented by counsel at
the hearing. These proposed time frames would be consistent with time
frames being proposed by DTC and NSCC.
4. Technical Changes
MBSD Article V, Rule 3 (``Fines and Other Sanctions'') would be
amended in accordance with the proposed changes to the hearing
procedures of MBSD.
In addition, minor technical changes would be made to the rules of
both Divisions where necessary to implement the proposed changes set
forth above.
5. Implementation of the Proposed Changes
The proposed changes will be implemented upon approval of this
proposed filing by the Commission. Members will be advised of the
implementation through an FICC Important Notice.
FICC believes that the proposed rule change is consistent with the
requirements of Section 17A of the Act \9\ and the rules and
regulations thereunder because the adoption of a Minor Rule Violation
Plan furthers the statutory objective of providing a fair procedure for
disciplining members and will provide FICC with the ability to impose
meaningful sanctions for those rule violations that do not necessarily
rise to a level meriting a full disciplinary proceeding. Accordingly,
the proposed rule change promotes the prompt and accurate clearance and
settlement of securities transactions.
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\9\ 15 U.S.C. 78q-1.
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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 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 proposed rule change have not been
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
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 (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 Number SR-FICC-2007-06 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 Number SR-FICC-2007-06. 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, on official business days between the hours
of 10 a.m. and 3 p.m. Copies of such filings also will be available for
inspection and copying at the principal office of FICC and on FICC's
Web site at https://www.dtcc.com/downloads/legal/rule_filings/2007/
ficc/2007-06.pdf. 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-
FICC-
[[Page 68924]]
2007-06 and should be submitted on or before December 21, 2007.
For the Commission by the Division of Trading and Markets,
pursuant to delegated authority.\10\
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\10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-23592 Filed 12-5-07; 8:45 am]
BILLING CODE 8011-01-P
