84 1 2 3 4 5 6 7 8 9 10 11 12. 13 14 15 16 17 tors, and in all other phases of the administration of its affairs; "(4) the rules of the clearing agency or securities depository provide for the equitable allocation of dues, fees, and other charges among its participants; "(5) the rules of the clearing agency or securities depository do not impose any schedule of prices, or fix minimum rates or charges, for services rendered by its participants; "(6) the rules of the clearing agency or securities depository are designed to promote the prompt and orderly processing and settlement of securities trans actions, to provide safeguards for securities and funds which are in its custody, to foster cooperation and coordination with national securities exchanges, national secu rities associations, other clearing agencies or securities depositories, brokers, dealers, banks, registered investment companies, and with other persons engaged in the settlement and processing of securities transactions, and 20 to protect investors and the public interest; and do not have the effect of unfairly discriminating in the admission of participants in the use of such clearing agency or security depository; "(7) the rules of the clearing agency or securities depository provide that its participants and persons 85 associated with participants shall be appropriately disciplined for any violation of its rules by expulsion, suspen sion, fine, or censure, or in the case of a person associated with a participant, by being suspended or barred from being associated with participants; and "(8) the rules of the clearing agency or securities depository provide a fair and orderly procedure with respect to the disciplining of participants and persons associated with participants and the denial of participation to any person seeking participation therein. In any proceeding to determine whether a participant or person associated with a participant should be disciplined, such rules shall require that specific charges of any rule viola tion be brought; that such participant or person associated with such participant shall be notified of and be given an opportunity to defend against such charges; that a record shall be kept; and that a determination to take disciplinary action shall be supported by a statement setting forth “(A) any act or practice in which such participant or person associated with such participant may be found to have engaged, or any required act or practice which such participant or person associated with such participant may be found to have omitted; "(B) the specific rule or rules of the clearing 1 2 3 4 5 86 agency or securities depository which any such act or practice, or omission to act, is deemed to violate; and "(C) the penalty imposed and the reason therefor. In any proceeding to determine whether a person shall be 6 denied participation, such rules shall provide that the pro7 spective participant shall be notified of, and be given an 8 opportunity to be heard upon, the specific grounds for de9 nial which are under consideration; that a record shall be 10 kept and that the determination to deny participation shall be 11 supported by a statement setting forth the specific grounds 12 on which the denial is based. Notwithstanding any other pro13 vision of this section, the rules of the clearing agency or secu14 rities depository may provide for the temporary suspension 15 of a participant, the prohibition of such participants, use of 16 the clearing agency or securities depository and the closing 17 of its accounts pending determination on the merits of any 18 disciplinary proceeding if, in the opinion of the clearing 19 agency or securities depository, such suspension or prohibition 20 on use and closing of accounts are necessary for the protection 21 of the clearing agency or securities depository or its partici22 pants or for the protection of investors or to facilitate the 23 orderly and continuous performance of the clearing agency's 24 or securities depository's services. The rules shall afford the 87 1 participant an expedited hearing an the merits in the case of 2 any temporary suspension. 3 "(e) The Commission shall, upon the filing of an appli4 cation for registration pursuant to subsection (c), publish 5 notice of the filing and afford interested persons a reasonable 6 opportunity for comment. Within sixty days of the filing of 7 an application for registration pursuant to subsections (b) 8 and (c) the Commission shall: 9 10 11 12 13 14 15 16 17 18 19 20 21 "(1) by order grant such registration if the Commission finds that the requirements of this section are satisfied, or "(2) institute appropriate administrative action to determine whether the application should be denied. After appropriate notice and opportunity for hearing, the Commission shall by order grant such registration unless it finds that any requirement of this section is not satisfied, or, in the case of an applicant who is a transfer agent, that the applicant does not have procedures or the means to be able to comply with the pro visions of this section and the rules and regulations promulgated under those provisions, in which case the 22 Commission shall by order deny such registration. The 22 23 24 Commission shall conclude administrative action and issue an order granting or denying an application within 1 2 3 4 88 one hundred and eighty days of the filing of the ap plication unless the Commission finds good cause to extend such period and publishes its reasons therefor. “(f) A clearing agency, securities depository, or trans5 fer agent, registered under this section may, upon such terms 6 and conditions as the Commission may deem necessary in 7 the public interest, for the protection of investors, or to assure 8 the prompt and accurate processing and settlement of se9 curities transactions, withdraw from registration by filing a 10 written notice of withdrawal from the Commission. If the 11 Commission finds that any such registrant or such other per12 son for whom an application of registration is pending is no 13 longer in existence or has ceased to do business in the ca14 pacity specified in the registration statement, the Commission 15 shall by order cancel or deny the registration. 16 "(g) No clearing agency, securities depository, or trans17 fer agent registered under this section shall, directly or in18 directly, engage in any activity as clearing agency, securities 19 depository, or transfer agent with respect to any security in 20 contravention of such rules and regulations as the Com21 mission shall prescribe as necessary or appropriate in the 22 public interest or for the protection of investors. 23 “(h) If any registered clearing agency or securities 24 depository takes any disciplinary action against any partici25 pant therein, or any person associated with a participant, or |