regulatory organizations; proposed rule changes: Depository Trust Co.,
[Federal Register: May 12, 1998 (Volume 63, Number 91)]
[Notices]
[Page 26235-26236]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12my98-142]
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-39946; File No. SR-DTC-98-03]
Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Fees and Charges
May 4, 1998.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act''),\1\ notice is hereby given that on February 20, 1998, The Depository Trust Company (``DTC'') filedwith the Securities and Exchange Commission (``Commission''), as amended on March 6, 1998, the proposed rule change as 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 form interested persons on the proposed rule change.
\1\ 15 U.S.C. 78s(b)(1).
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Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
The proposed rule change will adjust the fees charged by DTC for various services provided.
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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 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. DTC has prepared summaries, set forth in sections (A), (B),
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and (C) below, of the most significant aspects of such statements.\2\
\2\ 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
The purpose of the proposed rule change is to adjust the fees charged for various services in order to align them with DTC's projected service costs for 1998.\3\ The adjusted fees are based upon a review of service costs conducted by DTC's Board of Directors. This fee change will be effective for services provided on and after April 1, 1998.\4\
\3\ The revised fee schedule is attached to DTC's rule filing and is available for copying at the Commission's public reference room.
\4\ The last full scale revision of DTC's fees occurred in 1995 although several revenue adjustments were made by DTC in early 1996.
DTC believes the 1998 fee schedule will yield $5.0 million more in operating revenue annually than the present fee schedule would have yielded. DTC believes that the new fees will result in an average fee increase of 1.0% for participants based on their monthly bills from DTC for October, November, and December of 1997.
DTC believes that the proposed rule change is consistent with the requirements of Section 17A of the Act \5\ and the rules and regulations thereunder because it provides for the equitable allocation of dues, fees, and other charges among DTC's participants and other parties that use DTC's services.
\5\ 15 U.S.C. 78q-1.
(B) Self-Regulatory Organization's Statement on Burden on Competition
DTC does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purpose of the Act.
(C) Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others
Written comments from DTC participants or others have not been received on the proposed rule change. Participants and other users of DTC's services were informed that DTC's annual fees would likely increase by $5.0 million or approximately 1.5% in a July 2, 1997, memorandum entitled ``Preliminary Projections for 1997 Year-end General Refund and Anticipated 1998 Service Fees.'' DTC informed participants and other users of its services of the proposed fee revisions by a memorandum dated February 5, 1998, entitled ``1998 Revisions of DTC Service Fees.'' Because participants have supported cost based fees in the past and because the subject fee changes overall are modest, DTC did not consider necessary a formal period for participant comment this year.
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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)(ii) \6\ of the Act and pursuant to Rule 19b-4(e)(2) \7\ promulgated thereunder because the proposal establishes or changes a due, fee, or other charge imposed by DTC. At any time within sixty days of the filing of such 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.
\6\ 15 U.S.C. 78s(b)(3)(A)(ii)
\7\ 17 CFR 240.19b-4(e)(2).
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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, N.W., Washington, D.C. 20549. Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filedwith 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. Sec. 552, will be available for inspection and copying in the Commission's Public Reference Section, 450 Fifth Street, N.W., Washington, D.C. 20549. Copies of such filing also will be available for inspection and copying at the principal office of DTC. All submissions should refer to File No. SR-DTC-98-03 and should be submitted by June 2, 1998.
For the Commission by the Division of Market Regulation, pursuant to delegated authority.\8\
\8\ 17 CFR 200.30-3(a)(12).
Margaret H. McFarland, Deputy Secretary.
[FR Doc. 98-12457Filed5-11-98; 8:45 am]
BILLING CODE 8010-01-M
