In order to facilitate the prompt, accurate, and efficient clearance and settlement of securities transactions, the Commission, having due regard for the public interest, the protection of investors, the safeguarding of securities and funds, and the maintenance of fair competition among transfer agencies, is authorized to promulgate rules and regulations that are necessary or appropriate to implement the provisions of Section 17A of the Act. Some transfer agents maintain custody of securities on behalf of individual investors and securities depositories. They also may disburse dividends and interest payments and send securityowner communications, such as proxy materials and annual reports. Transfer agents cancel stock certificates presented for transfer, issue new stock certificates, and maintain the records reflecting the ownership of securities as agent for the issuer. Section 17A(a)(2)(A)(i) of the Act directs the Commission to use its authority under the Act 'to facilitate the establishment of a national system for the prompt and accurate clearance and settlement of transactions in securities.' 4 Transfer agents play a vital role in the operation of that system. 3 However, based on the comments received and the experience gained by the staff in considering appropriate records management solutions, the Commission is adopting the proposed amendments with certain changes discussed herein. The proposed amendments would have codified, in most part, two staff no-action positions that permitted transfer agents to use optical storage technology. 2 The purpose of the proposal was to increase the flexibility and efficiency of transfer agent recordkeeping while maintaining necessary controls over accuracy, integrity, and access to those records. On May 25, 1999, the Commission issued a release requesting comment on proposed amendments to its transfer agent record retention rule, Rule 17Ad-7, 1 that would allow registered transfer agents to use electronic and micrographic records storage systems subject to certain conditions ('Proposing Release').

Supplementary Information: The Commission today is adopting amendments to rule 17Ad-7 under the Act. Carpenter, Assistant Director, or David Karasik, Special Counsel, at 20, Office of Risk Management and Control, Division of Market Regulation, Securities and Exchange Commission, 450 5 th The amendments adopted today are consistent with the requirements of the Electronic Signatures in Global and National Commerce Act of 2000 ('ESIGN').įor Further Information Contact: Jerry W. The amendments are designed to increase the flexibility and efficiency of transfer agent recordkeeping. The new requirements apply only to those registered transfer agents that elect to store their records using these methods. The amendments will allow registered transfer agents to use electronic, microfilm, and microfiche records maintenance systems to preserve records that they are required to retain under Rule 17Ad-6. Summary: The Securities and Exchange Commission ('Commission') is amending its transfer agent record retention rule, Rule 17Ad-7, under the Securities Exchange Act of 1934 ('Act'). Recordkeeping Requirements for Transfer AgentsĪgency: Securities and Exchange Commission Recordkeeping Requirements for Transfer Agents Securities and Exchange Commission Final Rule: Recordkeeping Requirements for Transfer Agents (S7-17-99 Rel.

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