FINRA Board Approves Changes to Communications With the Public Rules, Trading Activity Fee
WASHINGTON—The Financial Industry Regulatory Authority (FINRA) announced that its Board of Governors approved proposed changes to FINRA's Communications With the Public Rules, as well as amendments to the Trading Activity Fee for firms with no customers that are engaged solely in proprietary trading activity for their own accounts.
The changes to the Communications With the Public Rules follow a retrospective rule review that was launched in April 2014, which was designed to assess their effectiveness and efficiency. The proposed rule changes to the Communications With the Public Rule set are the first changes made to FINRA rules under the retrospective rule review program. FINRA will issue a Regulatory Notice in the coming months seeking comment on proposed changes to Rules 2210, 2213 and 2214.
"The proposed changes to FINRA's Communications With the Public Rules will help ensure that these rules are meeting their intended investor-protection objectives by reasonably efficient means. FINRA also announced that it is proposing to tailor its Trading Activity Fee (TAF) to the business activities of proprietary trading firms with no customers," said FINRA Chairman and CEO Richard Ketchum.
FINRA will issue Regulatory Notices soliciting public comment on a series of proposals, including:
Communications With the Public
The Board authorized FINRA to publish a Regulatory Notice requesting comment on proposed amendments that would eliminate certain filing requirements that present a low level of risk to investors, such as the filing requirements for generic investment company material and investment company shareholder reports, and make other changes to better align the requirements to the relative risks presented by specific types of sales material.
Trading Activity Fee
The Board authorized FINRA to publish a Regulatory Notice requesting comment on proposed amendments to the TAF for firms with no customers and are engaged solely in proprietary trading activity for their own accounts. The proposed amendments would exclude from the TAF those transactions executed on an exchange of which the firm is a member (including non-market-maker trades) provided the firm does not have customers and trades only for its own account. These proposed changes follow the SEC's recent proposal to eliminate the registration exemption for proprietary trading firms that are members of exchanges but not FINRA.
A full list of the rulemaking items approved by FINRA's Board is available on FINRA's website.
FINRA, the Financial Industry Regulatory Authority, is the largest independent regulator for all securities firms doing business in the United States. FINRA is dedicated to investor protection and market integrity through effective and efficient regulation and complementary compliance and technology-based services. FINRA touches virtually every aspect of the securities business - from registering and educating all industry participants to examining securities firms, writing rules, enforcing those rules and the federal securities laws, and informing and educating the investing public. In addition, FINRA provides surveillance and other regulatory services for equities and options markets, as well as trade reporting and other industry utilities. FINRA also administers the largest dispute resolution forum for investors and firms. For more information, please visit www.finra.org.