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FEDERAL RESERVE BANK
OF NEW YORK
May 6, 1992
ELIGIBILITY OF FRENCH FIRMS AS PRIMARY DEALERS
Comment Invited by June 25 on Treatment of U.S. Firms
To All Primary Dealers in U.S. Government Securities:
Following is the text o f a statem ent issued by the Board of Governors of the Federal Reserve
System:
The Federal Reserve Board is requesting public comment on whether U.S. companies operating
in the French Government debt market have the same competitive opportunities as French companies
in that market.
Comments must be received by June 25, 1992.
The Primary Dealers Act of 1988, which became effective in August 1989, provides that the Fed
eral Reserve System may not designate or permit the continuation of the designation as a primary dealer
of any person of a foreign country if that person’s home country does not grant to U.S. companies the
same competitive opportunities in the underwriting and distribution of Government debt instruments
issued by the country as the country accords to domestic companies.
Printed on the reverse side o f this circular is the B oard’s official notice on this matter. Com
ments thereon should be subm itted by June 25 and should be sent to the Board, as indicated in the
notice.
E. G erald C o rr ig a n ,
President.
(Over)
FEDERAL RESERVE SYSTEM
Docket No. R-0757
TREATMENT OF U.S. COMPANIES OPERATING
IN GOVERNMENT DEBT MARKET IN FRANCE
AGENCY: Board of Governors of the Federal Reserve System.
ACTION: Notice of study and request for comment.
SUMMARY: Under the Primary Dealers Act of 1988, which became effective in August, 1989, the
Federal Reserve may not designate or permit the continuation of the designation as a primary dealer of
any person of a foreign country if that person’s home country does not grant to U.S. companies the
same competitive opportunities in the underwriting and distribution of government debt instruments
issued by such country as such country accords to its domestic companies. Pursuant to this Act, the
Federal Reserve is reviewing the government debt market of France and requests public comment on
the treatment of U.S. companies with respect to the French government debt market, focusing in
particular on the treatment of U.S. companies relative to domestic firms.
DATE: Comments must be received by June 25, 1992.
ADDRESS: Comments, which should refer to Docket No. R-0757, may be mailed to Board of Governors
of the Federal Reserve System, 20th Street and Constitution Avenue, N.W., Washington, D.C. 20551, to
the attention of Mr. William W. Wiles, Secretary. Comments addressed to the attention of Mr. Wiles may
be delivered to the Board’s mailroom between 8:45 a.m. and 5:15 p.m., and to the security control room
outside of those hours. Both the mailroom and the security control room are accessible from the
courtyard entrance on 20th Street between Constitution Avenue and C Street, N.W. Comments may be
inspected in Room B-1122 between 9:00 a.m. and 5:00 p.m., except as provided in section 261.8 of the
Board’s Rules Regarding the Availability of Information, 12 CFR 261.8.
FOR FURTHER INFORMATION CONTACT: Kathleen O’Day, Assistant General Counsel (202/4523786), or Deborah Burand, Senior Attorney (202/452-3427), Legal Division; John Montgomery,
Economist (202)/452-3579), or Larry Promisel, Senior Associate Director (202/452-3533), Division of
International Finance; Board of Governors of the Federal Reserve System. For the hearing impaired
only. Telecommunication Device for the Deaf (TDD), Dorothea Thompson (202/452-3544), Board of
Governors of the Federal Reserve System, 20th Street and Constitution Avenue, N.W., Washington, D.C.
20551.
SUPPLEMENTARY INFORMATION: Under the Primary Dealers Act of 1988 ("Act"), 22 U.S.C. §§ 53415342, the Federal Reserve may not permit a person of a foreign country to act as a primary dealer in
U.S. government securities if the person’s home country does not accord U.S. companies the same
competitive opportunities as the foreign country accords domestic companies in underwriting and
distributing government debt obligations of such foreign country. A "person of a foreign country"
includes any foreign individual or company that directly or indirectly controls a primary dealer.
In connection with a proposed transaction, a French company is expected to acquire
indirect control of a primary dealer in U.S. government securities. Accordingly, in order to make the
determination required by the Act, the Federal Reserve is undertaking a study of the government debt
market of France to determine whether U.S. companies are accorded national treatment in their access
to that market.
The Federal Reserve would welcome the views of U.S. firms or other persons on the
specific respects in which U.S. companies are accorded, or are not accorded, the same competitive
opportunities in the underwriting and distribution of French government debt instruments as France
accords to French dom estic companies. All such comments, which should be submitted by June 25,
1992, would be considered in the context of the study of this market.
By order of the Board of Governors, April 21, 1992.
@FedFRASER