Regulatory Notice 10-38

SEC Approves New FINRA Rule Relating to the Processing of and Fees for Company-Related Actions for Non-Exchange-Listed Securities

Effective Date: September 27, 2010

Executive Summary

Effective September 27, 2010, new FINRA Rule 6490 (Processing of Company-Related Actions) codifies the requirements in SEA Rule 10b-17 for issuers of a class of publicly trading securities to provide timely notice to FINRA of certain corporate actions (e.g., dividend or other distribution of cash or securities,stock split or reverse split, rights or subscription offering). Issuers must also provide timely notification to FINRA of certain other specified corporate actions. The rule clarifies the scope of FINRA’s regulatory authority and discretionary power when processing documents related to announcements for company-related actions for non-exchange listed equity and debt securities, and implements fees for these services. Issuers must complete the necessary forms and pay the applicable fees within the required time periods or they will be subject to late fees and delayed processing of documents to announce corporate actions.


The text of the new rule is set forth on FINRA’s website at www.finra.org/rulefilings/2009-089.

 

Questions regarding this Notice should be directed to:

 

  • FINRA Operations at (866) 776-0800; select option 1; or
  • Kosha K. Dalal, Associate Vice President and Associate General Counsel, Office of General Counsel, at (202) 728-6903.