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F ederal
reserve
bank of
DALLAS, TEXAS
Dallas
75222
C i r c u l a r No. 75-129
Septe mber 2, 1975
American Revolution Bicentennial
WITHDRAWAL OF PROPOSALS TO AMEND REGULATIONS C AND U
(" C le aranc e " T r a n s a c ti o n s )
WITHDRAWAL OF PROPOSAL TO AMEND REGULATION T
(Shorten Time for Payment A g a in s t Delivery
T r a n s a c t i o n s in S e c u r itie s from 35 Days to 15 Days)
TO ALL BANKS, BROKERS/DEALERS,
REGULATION G-REGISTRANTS,
AND OTHERS CONCERNED IN THE
ELEVENTH FEDERAL RESERVE DISTRICT:
T h e Board of G o v e rn o rs of th e Federa l R e s e rv e System has w it hd ra w n
its p r o p o s a ls to amend Regulation G, "S e c u r itie s C r e d i t by P e rs o n s O th er Tha n
B anks, B r o k e r s , or D e a l e r s , " and Regulation U, " C re d i t by Banks for the P u r
pose of P u r c h a s i n g o r C a r r y i n g Margin S t o c k s ," with re s p e c t to "clea ra nc e"
tr a n s a c t i o n s , and Regulation T , " C re d it by B ro k e rs and D e a l e r s , " to s h o rte n
the time allowed for paym ent a g a i n s t d e l i v e r y t r a n s a c t i o n s in s e c u r i t i e s from
35 d a y s to 15 d a y s .
T h e p r o p o s a ls c o n c e rn in g R egulations G and U w e re s e n t to you in this
B ank's C i r c u l a r No. 71-177, date d J u l y 31, 1971, a n d th ose c o n c e rn in g R e g u
lation T in o u r C i r c u l a r No. 72-277, date d December 4, 1972.
Copies of the B o a r d 's o r d e r s re la tin g to t h e s e m a tte rs a r e shown in the
e n c l o s u r e to th is c i r c u l a r .
S in c e r e ly y o u r s ,
T . W. Plant
F i r s t V ic e P re s id e n t
Enclo sure
This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)
FEDERAL RESERVE SYSTEM
[12 CFR 207]
[Reg. G]
Securities Credit by Persons
other than Banks, Brokers or Dealers
[12 CFR 221]
[Reg. U]
Credit by Banks for the Purpose of
Purchasing or Carrying Margin Stock
Withdrawal of Notices of Proposed Rulemaking
Notice is hereby given that the Board of Governors withdraws
notices (36 F. R. 14032 and 14035) published in the FEDERAL REGISTER
on July 29, 1971, on which comments were solicited, which proposed a
new paragraph (1) of § 207.1 of Regulation G and proposed an amendment
of § 221.1(a) of Regulation U.
The proposals were intended to prevent a person subject to
the registration requirement of § 207.1(a) of Regulation G, or a bank
subject to Regulation U, from providing "clearance" for any customer
for securities purchased through a broker or dealer unless a deposit of
the purchase price with the lender by the customer is made within
seven full business days, and in any event, before delivery to any
other person; or in case of sales, the lender promptly receives from
the customer the security sold and does not accept payment for a security
sold until he has received the security from the customer.
- 2 -
After consideration of the comments received, which reflected
difficulty in implementing certain provisions of the proposals, and in
the interest of allowing time for additional study and evaluation of
the proposals in light of the comprehensive system of clearance and
settlement contemplated by the Securities Acts Amendments of 1975
(P.L. 94-29), the Board has determined that the rulemaking action
referred to above, should be withdrawn.
In view of the foregoing, the proposals published in the
Federal Register (36 F. R. 14032 and 14035) on July 25, 1971 are
hereby withdrawn.
By order of the Board of Governors,August 13, 1975.
(Signed) Griffith L. Garwood
Griffith L. Garwood
Assitant Secretary of tHe Board
[SEAL]
FEDERAL RESERVE SYSTEM
[Reg. T]
[12 CFR 220]
CREDIT BY BROKERS AND DEALERS
Withdrawal of Notice of Proposed Rulemaking
Notice is hereby given that the Board of Governors withdraws
a notice (37 F. R. 25547) published in the FEDERAL REGISTER on December 1,
1972, on which comments were solicited
§ 220.4(c)(5) of Regulation T.
which proposed an amendment to
The proposed amendment would have
shortened the time allowed for payment against delivery transactions
in securities from 35 days to 15 days.
A number of comments were received in response to the notice;
all of them either opposed the amendment or suggested substantial
change.
Many commentators were in accord with the purpose of the pro
posed amendment, which was to speed up the consummation of securities
transactions, but suggested that its enactment would create undue
hardship unless integrated with a comprehensive system involving all
facets of the settlement process.
In view of the enactment of the
Securities Acts Amendments of 1975 (P. L. No. 94-29) which is intended
to facilitate the development of such a comprehensive system, the Board
has determired
that the proposed rulemaking action is not appropriate
at the present time and the proposal, therefore, should be withdrawn.
-2 -
In view of the foregoing, the proposal published in the
Federal Register (37 F. R. 25547) on December 1, 1972, is hereby
withdrawn.
By order of the Board of Governors, August 13, 1975.
(Signed) Griffith L* Garwood
Griffith L. Garwood
Assistant Secretary of the Board
[SEAL]
