Self Regulatory Organizations; National Securities Clearing Corporation; Notice of Filing of a Proposed Rule Change Seeking Permanent Approval for the New York Window Service

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-34470; File No. SR-NSCC-94-12]

Self Regulatory Organizations; National Securities Clearing

Corporation; Notice of Filing of a Proposed Rule Change Seeking

Permanent Approval for the New York Window Service

August 1, 1994.

Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934

(``Act'')\1\ notice is hereby given that on July 15, 1994, the National

Securities Clearing Corporation (``NSCC'') filed with the Securities

and Exchange Commission (``Commission'') the proposed rule change (File

No. SR-NSCC-94-12) as described in Items I, II, and III below, which

Items have been prepared primarily by NSCC. 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) (1988).

---------------------------------------------------------------------------

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

of the Proposed Rule Change

The proposed rule change consists of modifications to NSCC's Rules

and Procedures for NSCC's New York Window service and seeks permanent

approval of the service. The proposal will permit NSCC to replace the

participating members' record keeping systems with NSCC's proprietary

record keeping system. The proposal also sets forth the New York Window

fee schedule.

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.

(A) Self-Regulatory Organization's Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule Change

The New York Window is a service that provides for the processing

of receives and deliveries of physical securities. The New York Window

also provides facilities for the custody of physical securities and

custodial related services for physical securities. Currently, the New

York Window service is being offered on a pilot basis utilizing each

member's own record keeping system.\2\ This proposal will permit NSCC

to offer the New York Window service utilizing NSCC's proprietary

record keeping system. This system will enable NSCC and members to

electronically communicate with each other throughout the day. The New

York Window pilot program also offers a money settlement service to a

limited number of members. This proposal will enable NSCC to offer the

money settlement service to all New York Window members.

---------------------------------------------------------------------------

\2\For a complete description of the New York Window pilot

program, refer to Securities Exchange Act Release Nos. 32221 (April

26, 1993), 58 FR 36570 [File No. SR-NSCC-93-03] (order temporarily

approving proposed rule change until April 30, 1994) and 33558

(January 31, 1994), 59 FR 5807 [File No. SR-NSCC-93-14] (order

temporarily approving proposal rule change until January 31, 1995).

---------------------------------------------------------------------------

The New York Window service is offered to members under several

conditions. First, at all times, NSCC acts as an agent for members

using the New York Window service and not as principal for its own

account. Second, each New York Window member agrees that it will not be

entitled to reimbursement from NSCC for any losses suffered or

liabilities incurred as a result of the New York Window service. Third,

all actions taken by NSCC in connection with the New York Window

service will be based on instructions from members. Members will have

the ability to change instructions or add instructions throughout the

day. NSCC will have the ability to interactively communicate with

members with respect to instructions being processed. Each day, NSCC

will report to members the results of that day's processing (i.e.,

items received and delivered) and will provide members with an updated

stock record indicating the items being held in custody for the member

under the New York Window service.

The proposal also sets forth the fees that NSCC will charge for the

New York Window service.

IV. Other Service Fees:*

U. New York Window

1. Over The Window--............................ $12.00 per item

Receives/Deliveries...........................

2. Envelope Settlement Service/Receives

a. 1-100 daily................................ 6.00 per item

b. 101-150 daily.............................. 5.00 per item

c. 151-and up daily........................... 4.00 per item

3. Envelope Settlement Services/Deliveries...... 6.00 per item

4. FOSS/DSS--Receives/Deliveries (Money Only)... 3.50 per item

5. Transfers.................................... 15.00 per item

6. Reorganizations..............................

a. One-Way.................................... 15.00 per item

b. Two-Way.................................... 18.00 per item

7. Underwritings (Coordinating Distribution).... 35.00 per item

8. Special Handling............................. 35.00 per hour

9. Custody (Per Position Per Issue)............. .10 per day

10. Return to Firm (Securities)................. .10 per item

11. Internal Cross Receives/Deliveries.......... 7.00 per item

12. Messenger Service (Accommodation)........... 7.50 per hour

13. Accommodation Handling...................... 3.50 per item

14. Settlement Reconciliation................... 25.00 per day

Italic indicates additions.

*Indicates previously underlined text.

The New York Window service will afford members with the

opportunity to centralize their processing of physical securities.

Therefore, the proposed rule change is consistent with NSCC's

obligation under Section 17A of the Act to promote the prompt and

accurate clearance and settlement of securities transactions.

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

NSCC does not believe that the proposed rule change will impose any

burden on competition that is not necessary or appropriate in

furtherance of the purposes of the Act.

(C) Self-Regulatory Organization's Statement on Comments on the

Proposed Rule Change Received From Members, Participants or Others

Comments were neither solicited nor received.

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 reason 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 approved.

IV. Solicitation of Comments

Interested persons are invited to submit written data, views, and

arguments concerning the foregoing. Persons making written submission

should file six copies thereof with the Secretary, Securities and

Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549.

Copies of the submissions, 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, 450 Fifth Street, NW.,

Washington, DC 20549. Copies of such filings will also be available for

inspection and copying at the principal offices of NSCC. All

submissions should refer to File No. SR-NSCC-94-12 and should be

submitted by August 29, 1994.

For the Commission by the Division of Market Regulation,

pursuant to delegated authority.\3\

---------------------------------------------------------------------------

\3\17 CFR 200.30-3(a)(12) (1993).

---------------------------------------------------------------------------

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 94-19210 Filed 8-5-94; 8:45 am]

BILLING CODE 8010-01-M