OTC Reporting Facility Short Sale and Short Sale Exempt Trade Report

Member firms that submitted trade reports designated as "sold short" or "sold short exempt" to the OTC Reporting Facility (ORF) from January 3, 2011, to January 27, 2012, using the Financial Information eXchange (FIX) protocol may be eligible for a billing adjustment.

 

Prior to January 30, 2012, in very limited circumstances, short sale and short sale exempt trades reported to the ORF may not have reflected the intentions of the parties to the trade. In cases where a member firm submitted certain combinations of data regarding short sale designation that were inconsistent with stated FIX protocol specifications, the protocol interpreted the submission in accordance with certain parameters programmed into the protocol. If the interpretation did not reflect the parties' intentions, the member firm may have incurred additional ORF fees in correcting the trades.

 

Effective January 30, 2012, the ORF updated the process for submitting short sale trade reports into the NASDAQ ACT System using the FIX protocol. As of January 30, 2012, the ORF rejects any short sale or short sale exempt trade reports containing invalid data combinations. Please see NASDAQ Trader News for more information.

 

How to Request a Billing Adjustment

If your firm used the FIX protocol to submit short sale or short sale exempt trades from January 3, 2011, to January 27, 2012, and used invalid data combinations which resulted in an interpretation that did not reflect the parties' intention, your firm may be eligible for a billing adjustment.*

 

If your firm intends to request a billing adjustment, please contact Randy Rivera at (212) 858-5119 or via email at Randy.Rivera@finra.org by October 12, 2012. The deadline to submit supporting documentation is November 23, 2012.

 

Supporting Documentation

Firms must use the FINRA template to provide the supporting documentation and must include the following details about the original trade and details of the corresponding corrected trade report. Each file should not be larger than 10 MB. Firms must submit ORF and FINRA/NASDAQ TRF data in separate files. Member firms should submit the following:

  • A completed ORF Form signed by an authorized person at the member firm.
  • Supporting documentation that includes the Trade Report Date, ACT Control Number, FIX Tag 54 input value, and FIX Tag 853 input value of the following ORF trade reports submitted between January 3, 2011, and January 27, 2012:
    • Original trade report submitted via FIX where the interpretation did not accurately reflect the parties' intention.
    • Same day trade report correction to the original trade report.
    • Corrected or "As of" trade report to the original trade report.

 

The completed signed ORF Form and supporting documentation should be emailed to Randy.Rivera@finra.org by November 23, 2012.

 

*The maximum billing adjustment for the ORF and FINRA/NASDAQ TRF combined is $100,000 per firm in regard to this issue.