Securities Operations Division


Securities Industry Association 120 Broadway, New York, New York 10271

February 6, 2004

Mr. Jonathan G. Katz
Secretary
U.S. Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0609

Re: File No. SR-DTC-2003-09

Dear Mr. Katz:

The Securities Operations Division (SOD) welcomes the opportunity to provide comments on the Depository Trust Company's (DTC) proposed rule change to establish a new service to destroy certain certificates and to implement a fee for custody of certain certificates not to be destroyed.

As noted in the filing, the Securities Industry Association Securities Operations Division Regulatory and Clearance Committee (which represents over 600 operations executives throughout the securities industry) provided input to DTC during the development phase of the proposal. The members of the Regulatory and Clearance Committee are responsible for the review and implementation of various proposals that will ultimately effect the clearance, settlement and custody of securities transactions. The Committee voted overwhelmingly to support the filing at their meeting on June 4, 2003.

Our industry fully supports all efforts to achieve the goal of Straight Through Processing (STP) and the elimination of certificates wherever possible. The adoption of this proposal will be another step in moving towards the goal to dematerialize certificates, streamline the settlement process, remove costs and reduce risk.

In addition, we view the proposed fee structure as a viable measure to ensure that DTC's costs to custody any remaining certificates are met. This proposal is also consistent with 17A of the Act which provides rules and regulations to promote the prompt and accurate clearance and settlement of securities transactions.

The committee encourages the continuation of this process in the belief that, by working closely together on the development of industry initiatives, we will provide the basis for the acceptance of proposals before the SEC and other regulatory organizations, which are in our common interests and that of the industry in general.

In view of the above, we urge the Commission to adopt DTC's proposed rule change. The proposed rule is consistent with the objectives of the SIA's STP program and SOD supports the proposal.

We appreciate the opportunity to share our views on this subject.

Respectfully,

Edward Hazel
President
Securities Operations Division