28 1 tion to its power under section 8 of the Federal Deposit 2 Insurance Act, each of such appropriate regulatory agencies 3 may, for the purpose of enforcing compliance with this sec . 4 tion or any rule thereunder, exercise any other authority 5 conferred on it by law. 6 “(j) The Commission may, after appropriate notice and 7 opportunity for hearing, by order, censure, bar, or place lim8 itations upon any transfer agent for which it is the appro9 priate regulatory agency, or upon any partner, officer, di10 rector, or employee of any such transfer agent, or to suspend 11 for a period not exceeding twelve months or revoke the regis12 tration of any such transfer agent, if the Commission finds 13 that such censure, barring, placing of limitations, suspension, or revocation is in the public interest or necessary for the 15 protection of investors and that such transfer agent or part16 ner, officer, director, or employee thereof has willfully vio17 lated or is unable to comply with any provision of this section or any rule or regulation promulgated thereunder. All of the 19 functions and powers of the Commission under this title are 20 available to the Commission to enforce compliance by any 21 person with the requirements imposed under this section. 14 18 22 Except to the extent that enforcement of the requirements 23 imposed under this section is specifically committed to another appropriate regulatory agency, the Commission shall 25 have primary responsibility to enforce such requirements. 24 29 1 "(k) At least fifteen days prior to the issuance for pub2 lic comment or adoption of any proposed rule or regulation 3 regarding transfer agents, the agency contemplating issuance 4 or adoption of any such rule or regulation shall first consult 5 with and request the views of each of the other agencies 6 enumerated in section 3 (a) (25) concerning such rules to7 ward the end that rules and regulations applicable to banks 8 registered as transfer agents may be in accord with sound 9 banking practices and fulfill mutual regulatory needs to the 10 extent practicable.”. 11 SEC. 7. Section 12 of the Securities Exchange Act of 12 1934 (15 U.S.C. 781) is amended by inserting after sub13 section (i) the following new subsection: 14 "(j) It shall be unlawful for an issuer, any class of 15 whose securities is registered under this section or which 16 would be required to be so registered except for the excmp17 tion from registration provided by paragraph (2) (B) or 18 (2) (G) of subsection (g), by the use of any means or 19 instrumentality of interstate commerce, or of the mails, to 20 issue, either originally or upon transfer, any such securities 21 in a form or with a format which contravenes such rules and 22 regulations as the Commission may prescribe as necessary or 23 appropriate for the prompt and accurate processing of trans24 actions in securities.". 25 SEC. 8. Section 19 of the Securities Exchange Act of 30 1 1934 (15 U.S.C. 78s) is amended by inserting after sub2 section (e) the following new subsection: 3 "(f) The Commision is authorized and directed to 4 make a study and investigation of the practice of registration 5 9 of securities other than in the name of the beneficial owner 6 and to determine (1) whether such registration is consistent 7 with the policies and purposes of this title, with particular ref8 erence to section 14, and (2) if consistent, whether steps can be taken to facilitate communications between corpora10 tions and their shareholders while at the same time retaining 11 the benefits of such registration. The Commission shall report 12 to the Congress its preliminary findings within six months 13 after the date of enactment of this subsection, and its final 14 results and recommendations within one year of such date.". SEC. 9. Section 28 of the Securities Exchange Act of 16 1934 (15 U.S.C. 78bb) is amended by inserting after sub17 section (b) the following new subsection: 15 18 "(c) No State or political subdivision thereof shall im19 pose any tax on any change in beneficial or record owner20 ship of securities effected through the facilities of a regis21 tered clearing agency or any nominee thereof or custodian therefor or upon the delivery or transfer of securities to or 23 through or receipt from such agency or any nominee thereof 22 24 225 or custodian therefor, unless such transfer or delivery or re 25 ceipt would otherwise be taxable by such State or political 31 1 subdivision if the facilities of such registered clearing agency 2 or any nominee thereof or custodian therefor were not physi3 cally located in the taxing State or political subdivision. No 4 State or political subdivision thereof shall impose any tax on 5 securities which are deposited in or retained by a registered 6 clearing agency or any nominee thereof or custodian there7 for, unless such securities would otherwise be taxable by such 8 State or political subdivision if the facilities of such registered 9 clearing agency or any nominee thereof or custodian therefor 10 were not physically located in the taxing State or political 11 subdivision.". 12 SEC. 10. This Act shall become effective on the date 13 of its enactment, except that sections 17A (a) and 17B (a) 14 of the Securities Exchange Act of 1934 (as added by this 15 Act) shall become effective one hundred and eighty days 16 after the date of enactment. FEDERAL DEPOSIT INSURANCE CORPORATION, Washington, D.C. JUL 1 2 1973 Honorable Harrison A. Williams, Jr. United States Senate Dear Mr. Chairman: Thank you for your letter of June 29, 1973 inviting the Corporation to submit a written statement concerning S. 2058, 93d Congress, a bill "To amend the Securities Exchange Act of 1934 to provide for the regulation of clearing agencies and transfer agents, and for other purposes. The bill is substantially similar to S. 3876 which was passed unanimously by the Senate during the 92d Congress. ་་ With respect to the clearing agency function, S. 2058 would grant to the Securities and Exchange Commission the substantive rulemaking authority over all clearing agencies, and such agencies would be required to file registration statements with the SEC. Administrative disciplinary and review proceedings and other enforcement responsibilities would be conferred upon the "appropriate regulatory agency" which, in the case of an insured bank acting as a clearing agency, would be the Comptroller of the Currency, the Federal Reserve or the FDIC. The SEC and the bank regulatory agencies would be required to exchange copies of reports concerning clearing agencies where appropriate and to notify each other of actions taken with regard thereto. The SEC and the bank regulatory agencies would also be required to consult with and request the views of each other before issuing any proposed rule for public comment or adopting any such rule. We agree with the general thrust of these provisions regarding the regulation of clearing agencies, but would recommend that the last sentence of the proposed section 17A(o) requiring the appropriate regulatory agency to make a full and detailed report to the SEC of any |