[Federal Register Volume 60, Number 142 (Tuesday, July 25, 1995)] [Notices] [Pages 38068-38069] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 95-18216] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-35984; File No. SR-MSTC-95-07] Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by Midwest Securities Trust Company Relating to Access to the Legal Expert System July 18, 1995. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act''),\1\ notice is hereby given that on May 8, 1995, the Midwest Securities Trust Company (``MSTC'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule change as described in Items I, II, and III below, which Items have been prepared primarily by MSTC. 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 Organizations Statement of the Terms of Substance of the Proposed Rule Change MSTC proposes to make its inquiry-only Legal Expert System \2\ available to transfer agents that are not participants of MSTC pursuant to individually negotiated contracts with MSTC. \2\ For a complete description of the Legal Expert System, refer to Securities Exchange Act Release Nos. 33756 (March 11, 1994), 59 FR 13350 [File No. SR-MSTC-94-02] (order approving a rule change regarding the Legal Expert System's fees and a clarification disclaiming any liability on MSTC's part for any misinformation contained in the Legal Expert System); 35098 (December 13, 1994), 59 FR 65551 [SR-MSTC-94-17] (order modifying the pricing structure of the Legal Expert System); and 35447 (March 6, 1995) 60 FR 15177 [SR- MSTC-95-03] (order waiving the fees associated with the Legal Expert System until March 1, 1995). --------------------------------------------------------------------------- II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, MSTC 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. MSTC has prepared summaries, set forth in sections (A), (B), and (C) below, of the most significant aspects of such statements.\3\ \3\ The Commission had modified the text of the summaries prepared by MSTC. --------------------------------------------------------------------------- (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 provide transfer agents that are not MSTC participants with access to MSTC's inquiry- only Legal Expert System (``LES''). LES is a menu-driven computer program that allows a user to inquire about the documentation necessary for effecting a legal transfer of securities. The information found in LES is based on standard industry criteria as well as on individual state regulations for effecting legal transfers. LES provides the user with a main registration menu and a submenu for specific transfer situations. The self-help narratives guide the user through the system by providing information and examples for each certificate registration classification. The user is prompted to answer basic questions about the certificate registration and transfer situation to determine the legal delivery requirements and documentation needed for the specific state involved. LES will be available to nonparticipant transfer agents pursuant to individually negotiated contracts between MSTC and individual transfer agents. Among other things, the contracts will contain provisions that at a minimum waive MSTC's liability to the same extent as provided in MSTC's rules. The contracts also will require that transfer agents post a deposit with MSTC to protect MSTC against any unpaid fees. The fees that MSTC will charge the transfer agents (i.e., the [[Page 38069]] terminal inquiry fee, leased line fee, and communications fee) will be identical to the fees charged participants. MSTC believes that the proposed rule change is consistent with Section 17A of the Act because it will facilitate the prompt and accurate clearance and settlement of securities transactions. (B) Self-Regulatory Organization's Statement on Burden on Competition MSTC believes that no burden will be placed on competition as a result of the proposed rule change. (C) Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others MSTC neither solicited nor received written comments on the proposed rule change. III. 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)(iii) \4\ of the Act and Rule 19b-4(e)(4) \5\ thereunder because it effects a change in an existing service that does not adversely affect the safeguarding of securities or funds in the custody or control of MSTC or for which MSTC is responsible and does not significantly affect the respective rights or obligations of MSTC or persons using the service. At any time within sixty days of the filing of this rule change, the Commission may summarily abrogate this 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. \4\ 15 U.S.C. 78s(b)(3)(A)(iii) (1988). \5\ 17 CFR 240.19b-4(e)(4) (1994). --------------------------------------------------------------------------- IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing. 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 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. Sec. 552, will be available for inspection and copying at the Commission's Public Reference Section, 450 Fifth Street, N.W., Washington, DC 20549. Copies of such filings also will be available for inspection and copying at the principal office of MSTC. All submissions should refer to File No. SR-MSTC-95-07 and should be submitted by August 15, 1995. For the Commission by the Division of Market Regulation, pursuant to delegated authority. \6\ \6\ 17 CFR 200.30-3(a)(12) (1994). --------------------------------------------------------------------------- Margaret H. McFarland, Deputy Secretary. [FR Doc. 95-18216 Filed 7-24-95; 8:45 am] BILLING CODE 8010-01-M