Advertising Regulation Frequently Asked Questions (FAQ)


Rules

  1. What rules apply to communications with the public?
  2. What are the categories that make up communications with the public?

 

Internal Approval

  1. What are the approval requirements for retail communications?
  2. Are there any exceptions to the principal approval requirement for retail communications?

 

Filing Requirements

  1. What communications must be filed with FINRA prior to use?
  2. What communications must be filed with FINRA within 10 days of first use?
  3. What communications do not need to be filed with FINRA?
  4. Must all retail communications be filed with FINRA?
  5. Can communications be filed voluntarily?
  6. What information should accompany filings of ghostwritten communications on behalf of third party vendors?

 

Filing Process and Fees

  1. How do I file communications for review by FINRA?
  2. How will FINRA respond to communications that firms submit for review?
  3. What are the filing fees for the submission of communications to FINRA?
  4. How are filing fees paid?
  5. How do I access additional information about my Advertising Regulation fee transactions?
  6. How do I contact the Department?

 

Rules

 

1. What rules apply to communications with the public?
In general, FINRA member firms' communications with the public must comply with FINRA Rule 2210. Depending on the nature of the content, a communication may also need to comply with FINRA Rules 2212 (Use of Rankings in Retail Communications); 2213 (Requirements for the Use of Bond Mutual Fund Volatility Ratings); 2214 (Requirements for the Use of Investment Analysis Tools); 2215 (Communications with the Public Regarding Securities Futures); 2216 (Communications with the Public About Collateralized Mortgage Obligations; IM-2210-2 (Communications with the Public About Variable Life Insurance and Variable Annuities); and NASD Rule 2711(Research Analysts and Research Reports).

In addition to FINRA rules, communications pertaining to mutual funds, variable contracts and unit investment trusts registered as investment companies may also be subject to SEC Rule 482 if used prior to prospectus delivery. Communications concerning public direct participation programs and real estate investment trusts are generally subject to SEC Rule 134 if used prior to prospectus delivery.

Options communications must comply with FINRA Rule 2220.

MSRB Rule G-21 governs municipal securities and municipal fund securities (529 Plan) communications. In addition, municipal fund securities communications that refer to the underlying registered investment company securities must comply with FINRA Rule 2210.

Please feel free to contact the Advertising Regulation Department to inquire about specific rule applications.
2. What are the categories that make up communications with the public?
FINRA Rule 2210 defines three categories of communications:
  • Retail communication consists of any written (including electronic) communication that is distributed or made available to more than 25 retail investors within any 30 calendar-day period. A retail investor is any person other than an institutional investor, regardless of whether the person has an account with the firm.
  • Correspondence consists of any written (including electronic) communication distributed or made available to 25 or fewer retail investors within any 30 calendar-day period.
  • Institutional communication means any written (including electronic) communication that is distributed or made available only to institutional investors as defined but does not include a firm's internal communications. Institutional investors include banks, savings and loan associations, insurance companies, registered investment companies, registered investment advisors, a person or entity with assets of at least $50 million, government entities, employee benefit plans and qualified plans with at least 100 participants, FINRA member firms and registered persons, and a person acting solely on behalf of an institutional investor.

    If a firm has reason to believe that a communication intended for institutional investors will be forwarded to or made available to a person that is not an institutional investor, the communication must not be treated as an institutional communication. Note that individual participants of employee benefit plans and qualified plans are not considered institutional investors.

Internal Approval

 

1. What are the approval requirements for retail communications?
FINRA Rule 2210(b) requires that all retail communications must be approved by an appropriately qualified registered principal before the earlier of its use or filing with FINRA's Advertising Regulation Department.
2. Are there any exceptions to the principal approval requirement for retail communications?
A registered principal does not need to approve any retail communication that has already been filed with FINRA and that FINRA has deemed consistent with applicable standards, provided the communication has not been materially altered.

In addition, prior to use, approval is not required if a firm supervises and reviews the following types of retail communications in the same manner as correspondence pursuant to NASD Rule 3010(d):
  • any retail communication that does not make any financial or investment recommendation or otherwise promote a product or service of the member, including communications excepted from the definition of research reports; or
  • any retail communication that is posted on an online interactive electronic forum.

Filing Requirements

 

1. What communications must be filed with FINRA prior to use?
The following retail communications must be filed at least 10 business days prior to first use or publication:
  • retail communications of new member firms used in any electronic or public media for one year beginning on the date the firm's FINRA membership becomes effective, as reflected in the CRD system. For example, this requirement applies to any generally accessible website; newspaper, magazine, telephone directory or other advertisements; television or radio commercials; telephone or audio recordings; video displays, signs or billboards; and motion pictures;
  • retail communications that contain bond mutual fund volatility ratings;
  • retail communication that include rankings or performance comparison information that is not generally published or that is created by the investment company;
  • security futures retail communications; and
  • retail communications concerning options used prior to delivery of the options disclosure document must be filed 10 calendar days prior to use.
2. What communications must be filed with FINRA within 10 days of first use?
The following retail communications must be filed within 10 business days of use:
  • registered investment company retail communications. Please note: If the communication includes a performance ranking, the corroborating rankings or comparison information must also be included with the filing;
  • retail communications concerning any structured or derivative product registered under the Securities Act;
  • retail communications concerning public direct participation programs;
  • retail communications concerning collateralized mortgage obligations registered under the Securities Act;
  • final filmed versions of television and video communications previously filed in draft form; and
  • Any templates for written reports or any retail communications concerning investment analysis tools. Per FINRA Rule 2214(a), firms must provide FINRA with access to the tool.
In addition, retail communications concerning options used prior to delivery of the options disclosure document must be filed with FINRA 10 calendar days prior to use.

See the Summary of FINRA Rules 2210(c).
3. What communications do not need to be filed with FINRA?
The filing requirements do not apply to institutional communications and correspondence.
4. Must all retail communications be filed with FINRA?
No, some retail communications are excluded from the filing requirements. However, it is important to note that whether a communication is subject to filing or not, firms must ensure that all their communications regarding financial products and services comply with applicable FINRA, SEC, MSRB and SIPC rules.

The following retail communications are excluded from the filing requirements:
  • communications that refer to types of investments solely as a listing of the product or services offered by the firm;
  • retail communications that do not make any financial or investment recommendation or promote a firm's product or services;
  • prospectuses, preliminary prospectuses, fund profiles and other offering documents filed with the SEC or any state, or that is exempt from such registration. In addition, a free writing prospectus prepared by the issuer and filed with the SEC would also be excluded from the filing requirements. Note: While not a required filing, in connection with reviewing a filed communication, FINRA staff may request, or members may include with a filing, the relevant product prospectus;
  • a retail communication that contains only an incidental reference to an investment analysis tool (e.g., a brochure that merely mentions a tool as one of the services offered by the member) unless otherwise required by FINRA Rule 2210;
  • previously filed retail communications that are used without material change;
  • retail communications based on previously filed templates, with changes limited to updates of statistical or non-narrative information;
  • retail communications posted on an online interactive electronic forum;
  • press releases issued by NYSE-listed, closed-end investment companies as required by section 202.06 of the NYSE Listed Company Manual;
  • retail communications subject to SEC Rule 134 and matter of record announcements regarding participation in a private placement (except for those concerning public DPPs or registered investment company securities);
  • press releases made available only to the members of the media;
  • any reprint or excerpt of an article issued by a publisher that has not been materially altered in content except to comply with regulatory standards or correct errors and when the member has not commissioned the reprint and is not affiliated with the publisher; and
  • retail communications that do no more than identify the member or offer a specific security at a stated price.
5. Can communications be filed voluntarily?
Yes, firms may voluntarily file communications for review by FINRA. Some reasons for filing voluntarily include:
  • new product launch;.
  • use of a new format or medium, such as the firm's first television commercial or the firm's first mobile application;
  • compliance questions; and
  • response to rule changes.
6. What information should accompany filings of ghostwritten communications on behalf of third party vendors?
FINRA understands that some firms file ghostwritten communications on behalf of third party vendors for review. In order to facilitate these reviews, firms should disclose to FINRA that the communications were created by a third party vendor which may market them to other firms. Firms are reminded that Regulatory Notice 08-27 provides guidance about the use of ghostwritten communications.

Filing Process and Fees

 

1. How do I file communications for review by FINRA?
Firms file most communications for review using the Advertising Regulation Electronic Files (AREF) system. You may also call the Advertising Regulation Department at (240)386-4500 to learn more about how to file using AREF.
2. How will FINRA respond to communications that firms submit for review?
FINRA provides a written "Review Letter" electronically via the AREF system. The Review Letter provides necessary comments as to the compliance of the submission. In addition, the review letter documents the cost of the review.

Our expedited review service provides for a response within three business days (or other negotiated time period) after the day FINRA receives the material. FINRA will send expedited responses no later than close of business on the third review day. However, response time for regular submissions may vary depending on the volume of filings FINRA receives.
3. What are the filing fees for the submission of communications to FINRA?
As set forth in Section 13, Schedule A of the FINRA By-laws, the following fees apply to each communication submitted:

Regular Filings:
  • $ 125.00 for the first ten pages of material
  • $ 10.00 for each additional page
  • $ 125.00 for the first ten minutes of each video and audio item
  • $ 10.00 for each additional minute of each video and audio item
Expedited Filings:
  • $600.00 for all requests for expedited review for the first ten pages/minutes
  • $ 50.00 per page/minute in excess of the first ten pages/minutes
4. How are filing fees paid?
Each month, your firm's Super Account Administrator will receive an email notification that an Advertising Regulation invoice is available in E-Bill via Firm Gateway. The Advertising Regulation Invoice will provide detailed transaction charges incurred during the billing period along with the total amount due. You may pay your Advertising Regulation fling fees online using E-Bill:

  1. Firm Bank Account (ACH payment)
  2. Credit Card Payment (Visa, MasterCard or American Express)

In addition, there are three other payment methods

  1. FINRA Flex-Funding Account

    The FINRA Flex-Funding Account, formerly known as the CRD/IARD Daily Account, allows firms to view invoices and pay fees formerly paid through the Web CRD system.

     
  2. Wire Payments

    Funds may be wired for payment of filing fees. To pay Advertising invoices by wire transfers, provide your bank with the following information:

    Bank Name: Bank of America
    Transfer funds to: FINRA
    Wire ABA Number: 026009593
    ACH ABA Number: 054001204
    Beneficiary: FINRA
    Invoice Number

     
  3. Check Payment

    Checks can be sent by regular mail or by courier/overnight delivery. Checks sent by regular mail must be sent to the P.O. Box address provided below. All checks sent by courier or overnight delivery must be sent to the alternative address provided below, as the P.O. Box address will not accept courier or overnight deliveries. We encourage the use of the P.O. Box address as it facilitates more timely automated processing of your remittance.

    Include the invoice number on the check and send the payment to:

    FINRA
    P.O. Box 418911
    Boston, MA 02241-8911

    (Note: P.O. Box does not accept overnight/courier deliveries)

    For courier/overnight CHECKS only:

    Bank of America Lockbox Services
    FINRA 418911
    MA5-527-02-07
    2 Morrissey Blvd.
    Dorchester, MA 02125
     

Please contact the Finance billing department with questions about your Advertising Regulation Invoice at (240)386-5397.
5. How do I access additional information about my Advertising Regulation fee transactions?
Firms may view online in AREF a real time listing of current and past transactions. If your firm incurred filing fees prior to December 2012, you may also view historical Advertising Regulation Fee Account statements.
6. How do I contact the Department?
Our contact information is:

FINRA
Advertising Regulation Department
9509 Key West Avenue
Rockville, MD 20850-3389

Telephone: (240) 386-4500
Fax: (240) 386-4568