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Notice

Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Establishing a Clearing Fee

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Start Preamble November 6, 2001.

Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),[1] notice is hereby given that on September 26, 2001, The Options Clearing Corporation (“OCC”) filed with the Securities and Exchange Commission (“Commission”) 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 establishes a license fee and other fees that OCC will charge clearing members for the use of a new risk management software package called OCC-TIMS.

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 Start Printed Page 57142the 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. OCC has prepared summaries, set forth in sections (A), (B), and (C) below, 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 this rule change is to establish a license fee and other fees that OCC will charge clearing members for OCC-TIMS, a risk management software package developed by OCC.

OCC-TIMS is a client server software package developed by OCC for use by clearing members to enhance their internal risk management practices. This application will provide clearing members with access to provide risk management tools as it contains TIMS [3] calculations as well as analytical tools to facilitate “what if” scenarios and portfolio stress testing. OCC anticipates that OCC-TIMS will be available for licensing to clearing members in the fourth quarter of 2001.[4]

To promote the wide spread use of OCC-TIMS, OCC is proposing to charge clearing members a nominal fee of $500.00 to license the application and $250.00 for each product upgrade made after the initial license. Data feeds for theoretical prices will be charged as follows: $.10/contract with a minimum monthly charge of $200.00 and a maximum monthly charge of $2,000.00. These fees are comparable to those charged to clearing members accessing risk based haircut (“RBH”) data. For users receiving both OCC-TIMS and RBH data feeds, OCC is proposing to charge a maximum combined fee of $3,000.00 per month.

The proposed rule change is consistent with the requirements of Section 17A of the Act inasmuch as it establishes nominal and reasonable fees to be charged to clearing members for access to a risk management software package.

(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

Written comments were not and are not intended to be solicited with respect to the proposed rule change, and none have been received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action

Because the foregoing rule change establishes fees to be imposed by OCC upon clearing members, it has become effective pursuant to section 19(b)(3)(A)(ii) of the Act [5] and Rule 19b-4(f)(2).[6] At any time within sixty days of the filing of the 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.

VI. 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 NW., Washington, DC 20549-0609. 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, 450 Fifth Street NW., Washington, DC 20549. Copies of such filing will also be available for inspection and copying at the principal office of OCC. All submissions should refer to the file No. SR-OCC-2001-13 and should be submitted by December 5, 2001.

Start Signature

For the Commission by the Division of Market Regulation, pursuant to delegated authority.[7]

Margaret H. McFarland,

Deputy Secretary.

End Signature End Preamble

Footnotes

2.  The Commission has modified parts of these statements.

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3.  OCC's margin system is called the Theoretical Intermarket Margin System (TIMS).

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4.  OCC intends to offer OCC-TIMS to non-clearing member users in 2002.

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5.  15 U.S.C. 78s(b)(3)(A)(ii).

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[FR Doc. 01-28487 Filed 11-13-01; 8:45 am]

BILLING CODE 8010-01-M