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FEDERAL RESERVE SYSTEM

Docket No. 0997

TREATMENT OF U.S. COMPANIES OPERATING IN GOVERNMENT DEBT MARKET IN THE NETHERLANDS

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 on August 23, 1989, the Federal Reserve may not designate or permit the continuation of the designation of any person of a foreign country as a primary dealer in government debt instruments if such foreign country does not accord 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 the Netherlands and requests public comment on the treatment of U.S. companies with respect to the Netherlands' government debt market, focusing in particular on the treatment of U.S. companies relative to domestic firms.

DATES: Comments must be received by February 27, 1998.

ADDRESSES: Comments, which should refer to Docket No. 0997, may be mailed to the Board of Governors of the Federal Reserve System, 20th Street and Constitution Avenue NW, Washington, D.C. 20551, to the attention of Mr. William W. Wiles, Secretary. Comments addressed to the attention of Mr. Wiles may also be delivered to the Board's mailroom between 8:45 a.m. and 5:15 p.m. weekdays 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, NW. Comments will be available for inspection and copying by members of the public in the Freedom of Information Office, Room MP-500, between 9:00 a.m. and 5:00 p.m. weekdays, except as provided in section 261.8 of the Board's Rules Regarding the Availability of Information.

FOR FURTHER INFORMATION CONTACT: Kathleen O'Day, Associate General Counsel (202/452-3786), or Ann Misback, Managing Senior Counsel (202/452-3788), Legal Division; or Larry Promisel, Senior Advisor (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), Diane Jenkins (202/452-3544), Board of Governors of the Federal Reserve System., 20th and C Streets NW., Washington, D.C. 20551.

SUPPLEMENTARY INFORMATION: Under the Primary Dealers Act of 1988 ("Act"), 22 U.S.C. �� 5341-5342, 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.

A subsidiary of a bank organized in the Netherlands proposes to be designated as 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 the Netherlands 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 Dutch government debt instruments as the Netherlands accords to Dutch domestic companies. All such comments, which should be submitted by February 27, 1998, would be considered in the context of the study of this market.

By order of the Board of Governors of the Federal Reserve System, December 19, 1997.

(signed) William W. Wiles

William W. Wiles

Secretary of the Board

1997 Banking and consumer regulatory policy


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Last update: December 24, 1997, 10:00 AM