Regulatory Notice 17-16

FINRA Requests Comment on Proposed Limited Safe Harbor From FINRA Equity and Debt Research Rules for Desk Commentary

Comment Period Expires: May 30, 2017

In response to requests for an extension, the comment period has been extended to July 14, 2017.

Executive Summary

FINRA seeks comment on proposed amendments to FINRA Rule 2241 (Research Analysts and Research Reports) and FINRA Rule 2242 (Debt Research Analysts and Debt Research Reports) to create a limited safe harbor for specified brief, written analysis distributed to eligible institutional investors that comes from sales and trading or principal trading personnel but that may rise to the level of a research report (desk commentary). The proposed safe harbor would be subject to conditions, including compliance with a number of the Rule 2241 or Rule 2242 provisions to mitigate research-related conflicts. In addition, the proposed safe harbor would require firms to include a “health warning” on desk commentary and to obtain negative consent from eligible institutional investors to receive such commentary.

In a separate Regulatory Notice, FINRA is also requesting comment generally on its rules and programs governing the capital raising process and their effects on capital formation. In response to that Notice or this one, commenters are welcome to suggest changes to Rules 2241 and 2242 beyond those proposed below.

Questions regarding this Notice should be directed to:

  • Philip Shaikun, Vice President and Associate General Counsel, Office of General Counsel (OGC), at (202) 728-8451; or
  • Jeanette Wingler, Associate General Counsel, OGC, at (202) 728-8013.
The views, expressions, findings and opinions expressed in the comments on this Web page are solely those of the author(s) and FINRA accepts no responsibility for the content of the comments: 
DateCommenterFormat - Size
4/26/2017Odeon Capital Group LLCPDF - 97.38 KB
5/24/2017STAPDF - 410.17 KB
5/31/2017SIFMAPDF - 197.35 KB
6/5/2017Investment Company InstitutePDF - 1.06 MB
6/20/2017CFA InstitutePDF - 188.54 KB
7/13/2017EDAPDF - 444.33 KB
7/14/2017Peter R. GeraghtyPDF - 17.5 MB
7/14/2017BDAPDF - 386.94 KB