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Regulatory Notice 08-57

FINRA Announces SEC Approval and Effective Date for New Consolidated FINRA Rules Effective Date: December 15, 2008

SEC Approves New Consolidated FINRA Rules

Regulatory Notice
Notice Type

Rule Approvals
Consolidated Rulebook
Referenced Rules & Notices

Information Notice 03/12/08
Information Notice 10/06/08
FINRA Rule 0100 Series
FINRA Rule 2010
FINRA Rule 2020
FINRA Rule 2070
FINRA Rule 3130
FINRA Rule 3220
FINRA Rule 4560
FINRA Rule 5110
FINRA Rule 5130
FINRA Rule 5150
FINRARule 5190
FINRA Rule 6000 through 7000 Series
FINRA Rule 6121
FINRA Rule 6470
FINRA Rule 8000 Series
FINRA Rule 9000 Series
FINRA Rule 10000, 12000, 13000 and 14000 Series
NASD IM-1013-1
Suggested Routing

Compliance
Legal
Senior Management
Key Topic(s)

FINRA Manual
Rulebook Consolidation
Effective Dates of Consolidated Rules

Executive Summary

Following the consolidation of NASD and NYSE Regulation into FINRA, FINRA established a process to develop a new consolidated rulebook (Consolidated FINRA Rulebook), which FINRA has discussed in previous Information Notices.1 In recent months, FINRA began proposing new consolidated rules in phases for approval by the SEC as part of the Consolidated FINRA Rulebook.2 The first phase of new consolidated FINRA Rules, approved by the SEC in August and September 2008, will take effect on December 15, 2008.

Questions regarding this Notice should be directed to Adam H. Arkel, Assistant General Counsel, Office of General Counsel (OGC), at (202) 728-6961; or Matthew E. Vitek, Counsel, OGC, at (202) 728-8156.

Discussion

In August and September 2008, the SEC approved the following FINRA Rules and/or Rules Series for adoption as part of the Consolidated FINRA Rulebook:3

•  Rule 0100 Series (General Standards);
•  Rule 2010 (Standards of Commercial Honor and Principles of Trade);
•  Rule 2020 (Use of Manipulative, Deceptive or Other Fraudulent Devices);
•  Rule 2070 (Transactions Involving FINRA Employees);
•  Rule 3130 (Annual Certification of Compliance and Supervisory Processes);
•  Rule 3220 (Influencing or Rewarding Employees of Others);
•  Rule 4560 (Short-Interest Reporting);
•  Rule 5110 (Corporate Financing Rule—Underwriting Terms and Arrangements);
•  Rule 5130 (Restrictions on the Purchase and Sale of Initial Public Equity Offerings);
•  Rule 5150 (Fairness Opinions);
•  Rule 5190 (Notification Requirements for Offering Participants);
•  Rule 6121 (Trading Halts Due to Extraordinary Market Volatility);4
•  Rule 6470 (Withdrawal of Quotations in an OTC Equity Security in Compliance with SEC Regulation M);
•  Rule 6000 through 7000 Series (generally involving regulatory requirements and fees for quoting, trading, reporting, clearing and comparing over-the-counter transactions);
•  Rule 8000 Series (Investigations and Sanctions);
•  Rule 9000 Series (Code of Procedure); and
•  Rule 10000, 12000, 13000 and 14000 Series (involving Dispute Resolution procedures).

The Attachment to this Notice sets forth a detailed list of the new consolidated rules recently approved by the SEC. In the Attachment, the new rules are grouped by the rule filing that FINRA submitted to the SEC in connection with the rule change. The hyperlink to each rule filing is included. The filings provide, among other things, FINRA's statement of the purpose of the rule changes and, where applicable, exhibits showing the changes between the new rule text and the text of the NASD and/or Incorporated NYSE Rules as they exist in the Transitional Rulebook. Also, the text of the new FINRA Rules is available in the online FINRA Manual at www.finra.org/finramanual.5

The Attachment to this Notice further summarizes two additional rule filings relating to the Consolidated FINRA Rulebook approved by the SEC in September 2008. The first addresses the applicability of the new consolidated FINRA Rules to member firms of the NYSE that become members of FINRA pursuant to the membership waive-in process set forth in NASD IM-1013-1 (Membership Waive-In Process for Certain New York Stock Exchange Member Organizations) (such firms are referred to as Waive-In Firms).6 The second addresses FINRA's repeal of NASD Rule 1130 (Reliance on Current Membership List) and Incorporated NYSE Rules 405A (Non-Managed Fee-Based Account Programs—Disclosure and Monitoring), 440F (Public Short Sale Transactions Effected on the Exchange), 440G (Transactions in Stocks and Warrants for the Accounts of Members, Allied Members and Member Organizations) and 477 (Retention of Jurisdiction—Failure to Cooperate) as part of the process of developing the Consolidated FINRA Rulebook.7 The effective date of the rule changes set forth in these two filings is December 15, 2008.

Rule Conversion Chart

As an additional resource for member firms and the public, FINRA has created a Rule Conversion Chart on FINRA's Web site designed to help enhance familiarity with the new rules and show how the new rules relate to the NASD and/or Incorporated NYSE Rules in the Transitional Rulebook that they will replace.

The chart shows how rules from the Transitional Rulebook were either incorporated into the Consolidated FINRA Rulebook (by providing the corresponding new FINRA rule number and related rule filing number), or shows that the substance of the relevant rules from the Transitional Rulebook was not incorporated into the Consolidated FINRA Rulebook. Member firms should be aware that the chart is intended as a reference aid only. Throughout the rulebook consolidation process, member firms should further note that as rules are incorporated into the Consolidated FINRA Rulebook, there frequently will be revisions to existing rule language and changes to the rules' subject matter coverage. Accordingly, the language of the new consolidated rules often will not exactly match the language and coverage of the rules as they exist in the Transitional Rulebook. In some instances, the rules as they exist in the Transitional Rulebook will have been completely rewritten for purposes of the consolidation. Accordingly, FINRA reminds member firms that the chart does not in any way serve as a substitute for diligent review of the relevant new rule language. The Rule Conversion Chart is located at www.finra.org/ruleconversionchart.


1See Information Notice 10/06/08 (Rulebook Consolidation Process: Effective Dates of New Consolidated Rules; Introduction of Rule Conversion Chart); see also Information Notice 03/12/08 (Rulebook Consolidation Process).

2 The current FINRA rulebook includes (1) NASD Rules and (2) rules incorporated from NYSE (Incorporated NYSE Rules) (together, the NASD Rules and Incorporated NYSE Rules are referred to as the Transitional Rulebook). While the NASD Rules generally apply to all FINRA members, the Incorporated NYSE Rules apply only to those members of FINRA that are also members of the NYSE (Dual Members). The new FINRA Rules will apply to all member firms, unless such rules have a more limited application by their terms. As the Consolidated FINRA Rulebook expands with the SEC's approval and with the new FINRA Rules taking effect, the rules in the Transitional Rulebook that address the same subject matter of regulation will be eliminated. When the Consolidated FINRA Rulebook is completed, the Transitional Rulebook will have been eliminated in its entirety.

3See Exchange Act Release No. 58421 (August 25, 2008), 73 FR 51032 (August 29, 2008) (Order Approving Proposed Rule Change; File No. SR-FINRA-2008-025); Exchange Act Release No. 58461 (September 4, 2008), 73 FR 52710 (September 10, 2008) (Order Approving Proposed Rule Change; File No. SR-FINRA-2008-033); Exchange Act Release No. 58514 (September 11, 2008), 73 FR 54190 (September 18, 2008) (Order Approving Proposed Rule Change; SR-FINRA-2008-039); Exchange Act Release No. 58643 (September 25, 2008), 73 FR 57174 (October 1, 2008) (Order Approving Proposed Rule Change; File Nos. SR-FINRA-2008-021; SR-FINRA-2008-022; SR-FINRA-2008-026; SR-FINRA-2008-028 and SR-FINRA-2008-029); Exchange Act Release No. 58660 (September 26, 2008), 73 FR 57393 (October 2, 2008) (Order Approving Proposed Rule Change; File No. SR-FINRA-2008-027); Exchange Act Release No. 58661 (September 26, 2008), 73 FR 57395 (October 2, 2008) (Order Approving Proposed Rule Change; File No. SR-FINRA-2008-030).

4See Attachment endnote 1.

5 FINRA updates the rule text in its online Manual within two business days of SEC approval of changes to the rule text.

6See Exchange Act Release No. 58643 (September 25, 2008), 73 FR 57174 (October 1, 2008) (Order Approving Proposed Rule Change; File No. SR-FINRA-2008-022).

7See Exchange Act Release No. 58643 (September 25, 2008), 73 FR 57174 (October 1, 2008) (Order Approving Proposed Rule Change; File No. SR-FINRA-2008-029).


Attachment: List of Approved FINRA Rules (and Related Rule Filings)

The SEC approved the following new FINRA Rules in August and September 2008. The effective date of these rules is December 15, 2008. The new rules are grouped by the rule filing that FINRA submitted to the SEC in connection with the rule change. The hyperlink to each of the rule filings is included.

FINRA Rule Filing SR-FINRA-2008-021

www.finra.org/Industry/Regulation/RuleFilings/2008/P038544

The rule change transfers from the Transitional Rulebook to the Consolidated FINRA Rulebook the NASD Rule 4000 through 14000 Series, with the exception of the Rule 11000 Series (Uniform Practice Code). The NASD Rule 4000 through 7000 Series generally involve regulatory requirements and fees for quoting, trading, reporting, clearing and comparing over-the-counter transactions. The NASD Rule 8000 Series involves investigations and sanctions. The NASD Rule 9000 Series involves disciplinary procedures. The NASD Rule 10000, 12000, 13000 and 14000 Series involve Dispute Resolution (arbitration and mediation) procedures. The rule change adopts these rule series in their entirety as FINRA Rules as part of the Consolidated FINRA Rulebook, with certain non-material changes. The new rules occupy the Rule 6000 through 10000 Series and the Rule 12000 through 14000 Series in the Consolidated FINRA Rulebook as set forth in the tables below.

I. Rule 6000 Series—Quotation and Transaction Reporting Facilities
A. Rule 6100 Series—Quoting and Trading in NMS Stocks
 
Rule/Series No. Rule/Series Title
Rule 6110 Trading Otherwise than on an Exchange
Rule 6120 Trading Halts
Rule 6121 Trading Halts Due to Extraordinary Market Volatility1
Rule 6130 Transactions Related to Initial Public Offerings
Rule 6140 Other Trading Practices
Rule 6150 Obligation to Provide Information
Rule 6160 Multiple MPIDs for Trade Reporting Facility Participants
Rule 6170 Primary and Additional MPIDs for Alternative Display Facility Participants
Rule 6180 Series Transaction Reporting
Rule 6181 Timely Transaction Reporting
Rule 6182 Trade Reporting of Short Sales
Rule 6183 Exemption from SEC Regulation NMS-Related Trade Reporting Requirements
B. Rule 6200 Series—Alternative Display Facility
 
Rule/Series No. Rule/Series Title
Rule 6210 General
Rule 6220 Definitions
Rule 6230 Use of Alternative Display Facility Data Systems
Rule 6240 Prohibition from Locking or Crossing Quotations in NMS Stocks
Rule 6250 Quote and Order Access Requirements
Rule 6260 Review of Direct or Indirect Access Complaints
Rule 6270 Series Quoting and Trading in ADF-Eligible Securities
Rule 6271 Registration as an ADF Market Maker or ADF ECN
Rule 6272 Character of Quotations
Rule 6273 Normal Business Hours
Rule 6274 Clearance and Settlement
Rule 6275 Withdrawal of Quotations
Rule 6276 Voluntary Termination of Registration
Rule 6277 Suspension and Termination of Quotations by FINRA Action
Rule 6278 Termination of Alternative Display Facility Data System Service
Rule 6279 Alternative Trading Systems
Rule 6280 Series Transaction Reporting
Rule 6281 Reporting Transactions in ADF-Eligible Securities
Rule 6282 Transactions Reported by Members to TRACS
C. Rule 6300 Series—Trade Reporting Facilities
 
Rule/Series No. Rule/Series Title
Rule 6300A Series FINRA/NASDAQ Trade Reporting Facility
Rule 6310A General
Rule 6320A Definitions
Rule 6330A Use of FINRA/Nasdaq Trade Reporting Facility on a Test Basis
Rule 6340A Reports
Rule 6350A Clearance and Settlement
Rule 6360A Suspension and Termination by FINRA Action
Rule 6370A Termination of FINRA/Nasdaq Trade Reporting Facility Service
Rule 6380A Transaction Reporting
Rule 6300B Series FINRA/NSX Trade Reporting Facility
Rule 6310B General
Rule 6320B Definitions
Rule 6330B Use of FINRA/NSX Trade Reporting Facility on a Test Basis
Rule 6340B Reports
Rule 6350B Clearance and Settlement
Rule 6360B Suspension and Termination by FINRA Action
Rule 6370B Termination of FINRA/NSX Trade Reporting Facility Service
Rule 6380B Transaction Reporting
Rule 6300C Series FINRA/NYSE Trade Reporting Facility
Rule 6310C General
Rule 6320C Definitions
Rule 6330C Use of FINRA/NYSE Trade Reporting Facility on a Test Basis
Rule 6340C Reports
Rule 6350C Clearance and Settlement
Rule 6360C Suspension and Termination by FINRA Action
Rule 6370C Termination of FINRA/NYSE Trade Reporting Facility Service
Rule 6380C Transaction Reporting
D. Rule 6400 Series—Quoting and Trading in OTC Equity Securities
 
Rule No. Rule Title
Rule 6410 General
Rule 6420 Definitions
Rule 6430 Recording of Quotation Information
Rule 6440 Submission of SEA Rule 15c2-11 Information on Non-Exchange-Listed Securities
Rule 6450 Minimum Quotation Size Requirements For OTC Equity Securities
Rule 6460 Trading and Quotation Halt in OTC Equity Securities
E. Rule 6500 Series—OTC Bulletin Board® Service
 
Rule No. Rule Title
Rule 6510 Applicability
Rule 6520 Operation of the Service
Rule 6530 OTCBB-Eligible Securities
Rule 6540 Requirements Applicable to Market Makers
Rule 6550 Transaction Reporting
Rule 6560 Limit Order Protection2
F. Rule 6600 Series—OTC Reporting Facility
 
Rule/Series No. Rule/Series Title
Rule 6610 General
Rule 6620 Series Reporting Transactions in OTC Equity Securities
Rule 6621 Definitions
Rule 6622 Transaction Reporting
Rule 6623 Timely Transaction Reporting
Rule 6624 Trade Reporting of Short Sales
Rule 6630 Series Reporting Transactions in PORTAL® Securities
Rule 6631 Definitions
Rule 6632 Limitations on Transactions in PORTAL Securities
Rule 6633 Reporting Debt and Equity Transactions in PORTAL Securities
Rule 6634 Arbitration
Rule 6635 FINRA Rules
Rule 6640 Series Reporting Transactions in Direct Participation Program Securities
Rule 6641 General
Rule 6642 Definitions
Rule 6643 Transaction Reporting
G. Rule 6700 Series—Trade Reporting and Compliance Engine (TRACE)
 
Rule No. Rule Title
Rule 6710 Definitions
Rule 6720 Participation in TRACE
Rule 6730 Transaction Reporting
Rule 6740 Termination of TRACE Service
Rule 6750 Dissemination of Transaction Information
Rule 6760 Managing Underwriter or Group of Underwriters Obligation To Obtain CUSIP and Provide Notice
II. Rule 7000 Series—Clearing, Transaction and Order Data Requirements, and Facility Charges
A. Rule 7100 Series—Alternative Display Facility/TRACS
 
Rule No. Rule Title
Rule 7110 Definitions
Rule 7120 Participation in TRACS Trade Comparison Feature by Participants in the Alternative Display Facility
Rule 7130 Trade Report Input
Rule 7140 TRACS Processing
Rule 7150 Obligation to Honor Trades
Rule 7160 Audit Trail Requirements
Rule 7170 Termination of TRACS Service
B. Rule 7200 Series—Trade Reporting Facilities
 
Rule/Series No. Rule/Series Title
Rule 7200A Series FINRA/NASDAQ Trade Reporting Facility
Rule 7210A Definitions
Rule 7220A Trade Reporting Participation Requirements
Rule 7230A Trade Report Input
Rule 7240A Trade Report Processing
Rule 7250A Obligation to Honor Trades
Rule 7260A Audit Trail Requirements
Rule 7270A Violation of Reporting Rules
Rule 7280A Termination of Access
Rule 7200B Series FINRA/NSX Trade Reporting Facility
Rule 7210B Definitions
Rule 7220B Trade Reporting Participation Requirements
Rule 7230B Trade Report Input
Rule 7240B Trade Report Processing
Rule 7250B Obligation to Honor Trades
Rule 7260B Audit Trail Requirements
Rule 7270B Violation of Reporting Rules
Rule 7280B Termination of Access
Rule 7200C Series FINRA/NYSE Trade Reporting Facility
Rule 7210C Definitions
Rule 7220C Trade Reporting Participation Requirements
Rule 7230C Trade Report Input
Rule 7240C Trade Report Processing
Rule 7250C Obligation to Honor Trades
Rule 7260C Audit Trail Requirements
Rule 7270C Violation of Reporting Rules
Rule 7280C Termination of Access
C. Rule 7300 Series—OTC Reporting Facility
 
Rule No. Rule Title
Rule 7310 Definitions
Rule 7320 Trade Reporting Participation Requirements
Rule 7330 Trade Report Input
Rule 7340 Trade Report Processing
Rule 7350 Obligation to Honor Trades
Rule 7360 Audit Trail Requirements
Rule 7370 Violation of Reporting Rules
Rule 7380 Termination of Access
D. Rule 7400 Series—Order Audit Trail System
 
Rule No. Rule Title
Rule 7410 Definitions
Rule 7420 Applicability
Rule 7430 Synchronization of Member Business Clocks
Rule 7440 Recording of Order Information
Rule 7450 Order Data Transmission Requirements
Rule 7460 Violation of Order Audit Trail System Rules
Rule 7470 Exemption to the Order Recording and Data Transmission Requirements
E. Rule 7500 Series—Charges for Alternative Display Facility Services and Equipment
 
Rule No. Rule Title
Rule 7510 System Services
Rule 7520 Equipment Related Charges
Rule 7530 Installation, Removal, Relocation or Maintenance
Rule 7540 Other Services
Rule 7550 Partial Month Charges
Rule 7560 Late Fees
Rule 7570 Minor Modifications in Charges
F. Rule 7600 Series—Charges for Trade Reporting Facility Services
 
Rule/Series No. Rule/Series Title
Rule 7600A Series Charges for FINRA/NASDAQ Trade Reporting Facility Services
Rule 7610A Securities Transaction Credit
Rule 7620A FINRA/Nasdaq Trade Reporting Facility Reporting Fees
Rule 7630A Aggregation of Activity of Affiliated Members
Rule 7640A Late Fees
Rule 7600B Series Charges for FINRA/NSX Trade Reporting Facility Services
Rule 7610B Securities Transaction Credits3
Rule 7620B FINRA/NSX Trade Reporting Facility Reporting Fees
Rule 7630B Fee for Submission of Non-Media Reports
Rule 7600C Series Charges for FINRA/NYSE Trade Reporting Facility Services
Rule 7610C Securities Transaction Credit
Rule 7620C FINRA/NYSE Trade Reporting Facility Reporting Fees
G. Rule 7700 Series—Charges for OTC Reporting Facility, OTC Bulletin Board and Trade Reporting and Compliance Engine Services
 
Rule No. Rule Title
Rule 7710 OTC Reporting Facility
Rule 7720 OTC Bulletin Board Service
Rule 7730 Trade Reporting and Compliance Engine (TRACE)
Rule 7740 Historical Research and Administrative Reports
III. Rule 8000 Series—Investigations and Sanctions
A. Rule 8100 Series—General Provisions
 
Rule No. Rule Title
Rule 8110 Availability of Manual to Customers
Rule 8120 Definitions
B. Rule 8200 Series—Investigations
 
Rule No. Rule Title
Rule 8210 Provision of Information and Testimony and Inspection and Copying of Books
Rule 8211 Automated Submission of Trading Data Requested by FINRA
Rule 8213 Automated Submission of Trading Data for Non-Exchange-Listed Securities Requested by FINRA
C. Rule 8300 Series—Sanctions
 
Rule No. Rule Title
Rule 8310 Sanctions for Violation of the Rules
Rule 8311 Effect of a Suspension, Revocation, Cancellation, or Bar
Rule 8312 FINRA BrokerCheck Disclosure
Rule 8313 Release of Disciplinary Complaints, Decisions and Other Information
Rule 8320 Payment of Fines, Other Monetary Sanctions, or Costs; Summary Action for Failure to Pay
Rule 8330 Costs of Proceedings
IV. Rule 9000 Series—Code of Procedure
A. Rule 9100 Series—Application and Purpose
 
Rule/Series No. Rule/Series Title
Rule 9110 Application
Rule 9120 Definitions
Rule 9130 Series Service; Filing of Papers
Rule 9131 Service of Complaint and Document Initiating a Proceeding
Rule 9132 Service of Orders, Notices, and Decisions by Adjudicator
Rule 9133 Service of Papers Other Than Complaints, Orders, Notices, or Decisions
Rule 9134 Methods of, Procedures for Service
Rule 9135 Filing of Papers with Adjudicator: Procedure
Rule 9136 Filing of Papers: Form
Rule 9137 Filing of Papers: Signature Requirement and Effect
Rule 9138 Computation of Time
Rule 9140 Series Proceedings
Rule 9141 Appearance and Practice; Notice of Appearance
Rule 9142 Withdrawal by Attorney or Representative
Rule 9143 Ex Parte Communications
Rule 9144 Separation of Functions
Rule 9145 Rules of Evidence; Official Notice
Rule 9146 Motions
Rule 9147 Rulings on Procedural Matters
Rule 9148 Interlocutory Review
Rule 9150 Exclusion From Rule 9000 Series Proceeding
Rule 9160 Recusal or Disqualification
B. Rule 9200 Series—Disciplinary Proceedings
 
Rule/Series No. Rule/Series Title
Rule 9210 Series Complaint and Answer
Rule 9211 Authorization of Complaint
Rule 9212 Complaint Issuance—Requirements, Service, Amendment, Withdrawal, and Docketing
Rule 9213 Assignment of Hearing Officer and Appointment of Panelists to Hearing Panel or Extended Hearing Panel
Rule 9214 Consolidation or Severance of Disciplinary Proceedings
Rule 9215 Answer to Complaint
Rule 9216 Acceptance, Waiver, and Consent; Plan Pursuant to SEA Rule 19d-1(c)(2)
Rule 9217 Violations Appropriate for Disposition Under Plan Pursuant to SEA Rule 19d-1(c)(2)
Rule 9220 Series Request for Hearing; Extensions of Time, Postponements, Adjournments
Rule 9221 Request for Hearing
Rule 9222 Extensions of Time, Postponements, and Adjournments
Rule 9230 Series Appointment of Hearing Panel, Extended Hearing Panel
Rule 9231 Appointment by the Chief Hearing Officer of Hearing Panel or Extended Hearing Panel or Replacement Hearing Officer
Rule 9232 Criteria for Selection of Panelists and Replacement Panelists
Rule 9233 Hearing Panel or Extended Hearing Panel: Recusal and Disqualification of Hearing Officers
Rule 9234 Hearing Panel or Extended Hearing Panel: Recusal and Disqualification of Panelists
Rule 9235 Hearing Officer Authority
Rule 9240 Series Pre-hearing Conference and Submission
Rule 9241 Pre-hearing Conference
Rule 9242 Pre-hearing Submission
Rule 9250 Series Discovery
Rule 9251 Inspection and Copying of Documents in Possession of Staff
Rule 9252 Requests for Information
Rule 9253 Production of Witness Statements
Rule 9260 Series Hearing and Decision
Rule 9261 Evidence and Procedure in Hearing
Rule 9262 Testimony
Rule 9263 Evidence: Admissibility
Rule 9264 Motion for Summary Disposition
Rule 9265 Record of Hearing
Rule 9266 Proposed Findings of Fact, Conclusions of Law, and Post-Hearing Briefs
Rule 9267 Record; Supplemental Documents Attached to Record; Retention
Rule 9268 Decision of Hearing Panel or Extended Hearing Panel
Rule 9269 Default Decisions
Rule 9270 Settlement Procedure
Rule 9280 Contemptuous Conduct
Rule 9290 Expedited Disciplinary Proceedings
C. Rule 9300 Series—Review of Disciplinary Proceeding by National Adjudicatory Council and FINRA Board; Application for SEC Review
 
Rule/Series No. Rule/Series Title
Rule 9310 Series Appeal to or Review by National Adjudicatory Council
Rule 9311 Appeal by Any Party; Cross-Appeal
Rule 9312 Review Proceeding Initiated By Adjudicatory Council
Rule 9313 Counsel to National Adjudicatory Council
Rule 9320 Series Transmission of Record; Extensions of Time, Postponements, Adjournments
Rule 9321 Transmission of Record
Rule 9322 Extensions of Time, Postponements, Adjournments
Rule 9330 Series Appointment of Subcommittee or Extended Proceeding Committee; Disqualification and Recusal
Rule 9331 Appointment of Subcommittee or Extended Proceeding Committee
Rule 9332 Disqualification and Recusal
Rule 9340 Series Proceedings
Rule 9341 Oral Argument
Rule 9342 Failure to Appear at Oral Argument
Rule 9343 Disposition Without Oral Argument
Rule 9344 Failure to Participate Below; Abandonment of Appeal
Rule 9345 Subcommittee or Extended Proceeding Committee Recommended Decision to National Adjudicatory Council
Rule 9346 Evidence in National Adjudicatory Council Proceedings
Rule 9347 Filing of Papers in National Adjudicatory Council Proceedings
Rule 9348 Powers of the National Adjudicatory Council on Review
Rule 9349 National Adjudicatory Council Formal Consideration; Decision
Rule 9350 Series Discretionary Review by FINRA Board
Rule 9351 Discretionary Review by FINRA Board
Rule 9360 Effectiveness of Sanctions
Rule 9370 Application to SEC for Review
D. Rule 9500 Series—Other Proceedings
 
Rule/Series No. Rule/Series Title
Rule 9520 Series Eligibility Proceedings
Rule 9521 Purpose and Definitions
Rule 9522 Initiation of Eligibility Proceeding; Member Regulation Consideration
Rule 9523 Acceptance of Member Regulation Recommendations and Supervisory Plans by Consent Pursuant to SEA Rule 19h-1
Rule 9524 National Adjudicatory Council Consideration
Rule 9525 Discretionary Review by the FINRA Board
Rule 9526 Expedited Review
Rule 9527 Application to SEC for Review
Rule 9550 Series Expedited Proceedings
Rule 9551 Failure to Comply with Public Communication Standards
Rule 9552 Failure to Provide Information or Keep Information Current
Rule 9553 Failure to Pay FINRA Dues, Fees and Other Charges
Rule 9554 Failure to Comply with an Arbitration Award or Related Settlement
Rule 9555 Failure to Meet the Eligibility or Qualification Standards or Prerequisites for Access to Services
Rule 9556 Failure to Comply with Temporary and Permanent Cease and Desist Orders
Rule 9557 Procedures for Regulating Activities Under NASD Rules 3130 and 3131 Regarding a Member Experiencing Financial or Operational Difficulties
Rule 9558 Summary Proceedings for Actions Authorized by Section 15A(h)(3) of the Exchange Act
Rule 9559 Hearing Procedures for Expedited Proceedings Under the Rule 9550 Series
E. Rule 9600 Series—Procedures for Exemptions
 
Rule No. Rule Title
Rule 9610 Application
Rule 9620 Decision
Rule 9630 Appeal
F. Rule 9700 Series—Procedures on Grievances Concerning the Automated Systems
 
Rule No. Rule Title
Rule 9710 Purpose
Rule 9720 Form of Application
Rule 9730 Request for Hearing
Rule 9740 Consideration of Applications
Rule 9750 Decision
Rule 9760 Call for Review by the National Adjudicatory Council
Rule 9770 Application to SEC for Review
G. Rule 9800 Series—Temporary Cease and Desist Orders
 
Rule No. Rule Title
Rule 9810 Initiation of Proceeding
Rule 9820 Appointment of Hearing Officer and Hearing Panel
Rule 9830 Hearing
Rule 9840 Issuance of Temporary Cease and Desist Order by Hearing Panel
Rule 9850 Review by Hearing Panel
Rule 9860 Violation of Temporary Cease and Desist Orders
Rule 9870 Application to SEC for Review
V. Rule 10000 Series—Code of Arbitration Procedure
A. Rule 10100 Series—Administrative Provisions
 
Rule No. Rule Title
IM-10100 Failure to Act Under Provisions of Code of Arbitration Procedure
Rule 10101 Matters Eligible for Submission
Rule 10102 National Arbitration and Mediation Committee
Rule 10103 Director of Arbitration
Rule 10104 Composition and Appointment of Panels
IM-10104 Arbitrators' Honorarium
Rule 10105 Non-Waiver of FINRA Objects and Purposes
Rule 10106 Legal Proceedings
B. Rule 10200 Series—Industry and Clearing Controversies
 
Rule No. Rule Title
Rule 10201 Required Submission
Rule 10202 Composition of Panels
Rule 10203 Simplified Industry Arbitration
Rule 10204 Applicability of Uniform Code
Rule 10205 Schedule of Fees for Industry and Clearing Controversies
Rule 10210 Statutory Employment Discrimination Claims
Rule 10211 Special Arbitrator Qualifications for Employment Discrimination Disputes
Rule 10212 Composition of Panels
Rule 10213 Discovery
Rule 10214 Awards
Rule 10215 Attorneys' Fees
Rule 10216 Coordination of Claims Filed in Court and in Arbitration
Rule 10217 Fees
C. Rule 10300 Series—Uniform Code of Arbitration
 
Rule No. Rule Title
Rule 10301 Required Submission
Rule 10302 Simplified Arbitration
IM-10302 Related Counterclaim
Rule 10303 Hearing Requirements—Waiver of Hearing
Rule 10304 Time Limitation Upon Submission
Rule 10305 Dismissal of Proceedings
Rule 10306 Settlements
Rule 10307 Tolling of Time Limitation(s) for the Institution of Legal Proceedings and Extension of Time Limitation(s) for Submission to Arbitration
Rule 10308 Selection of Arbitrators
IM-10308 Arbitrators Who Also Serve as Mediators
Rule 10309 Composition of Panels
Rule 10310 Notice of Selection of Arbitrators
Rule 10311 Peremptory Challenge
Rule 10312 Disclosures Required of Arbitrators and Director's Authority to Disqualify
Rule 10313 Disqualification or Other Disability of Arbitrators
Rule 10314 Initiation of Proceedings
Rule 10315 Determination of Hearing Location
Rule 10316 Representation by Counsel
Rule 10317 Attendance at Hearings
IM-10317 Closing Arguments
Rule 10318 Failure to Appear
Rule 10319 Adjournments
Rule 10320 Acknowledgement of Pleadings
Rule 10321 General Provisions Governing Pre-Hearing Proceedings
Rule 10322 Subpoenas and Power to Direct Appearances
Rule 10323 Evidence
Rule 10324 Interpretation of Provisions of Code and Enforcement of Arbitrator Rulings
Rule 10325 Determination of Arbitrators
Rule 10326 Record of Proceedings
Rule 10327 Oaths of the Arbitrators and Witnesses
Rule 10328 Amendments
Rule 10329 Reopening of Hearings
Rule 10330 Awards
Rule 10331 Incorporation by Reference
Rule 10332 Schedule of Fees for Customer Disputes
Rule 10333 Member Surcharge and Process Fees
Rule 10334 Direct Communication Between Parties and Arbitrators
Rule 10335 Temporary Injunctive Orders; Requests for Permanent Injunctive Relief
VI. Rule 12000 Series—Code of Arbitration Procdure for Customer Disputes
A. Part I—Interpretive Material, Definitions, Organization and Authority
 
Rule No. Rule Title
IM-12000 Failure to Act Under Provisions of Code of Arbitration Procedure for Customer Disputes
Rule 12100 Definitions
Rule 12101 Applicability of Code and Incorporation by Reference
Rule 12102 National Arbitration and Mediation Committee
Rule 12103 Director of Dispute Resolution
Rule 12104 Effect of Arbitration on FINRA Regulatory Activities
Rule 12105 Agreement of the Parties
B. Part II—General Arbitration Rules
 
Rule No. Rule Title
Rule 12200 Arbitration Under an Arbitration Agreement or the Rules of FINRA
Rule 12201 Elective Arbitration
Rule 12202 Claims Against Inactive Members
Rule 12203 Denial of FINRA Forum
Rule 12204 Class Action Claims
Rule 12205 Shareholder Derivative Actions
Rule 12206 Time Limits
Rule 12207 Extension of Deadlines
Rule 12208 Representation of Parties
Rule 12209 Legal Proceedings
Rule 12210 Ex Parte Communications
Rule 12211 Direct Communications Between Parties and Arbitrators
Rule 12212 Sanctions
Rule 12213 Hearing Locations
Rule 12214 Payment of Arbitrators
C. Part III—Initiating and Responding to Claims
 
Rule No. Rule Title
Rule 12300 Filing and Serving Documents
Rule 12301 Service on Associated Persons
Rule 12302 Filing an Initial Statement of Claim
Rule 12303 Answering the Statement of Claim
Rule 12304 Answering Counterclaims
Rule 12305 Answering Cross Claims
Rule 12306 Answering Third Party Claims
Rule 12307 Deficient Claims
Rule 12308 Loss of Defenses Due to Untimely or Incomplete Answer
Rule 12309 Amending Pleadings
Rule 12310 Answering Amended Claims
Rule 12311 Amendments to Amount in Dispute
Rule 12312 Multiple Claimants
Rule 12313 Multiple Respondents
Rule 12314 Combining Claims
D. Part IV—Appointment, Disqualification, and Authority of Arbitrators
 
Rule No. Rule Title
Rule 12400 Neutral List Selection System and Arbitrator Rosters
Rule 12401 Number of Arbitrators
Rule 12402 Composition of Arbitration Panels
Rule 12403 Generating and Sending Lists to the Parties
Rule 12404 Striking and Ranking Arbitrators
Rule 12405 Combining Lists
Rule 12406 Appointment of Arbitrators; Discretion to Appoint Arbitrators Not on List
Rule 12407 Additional Parties
Rule 12408 Disclosures Required of Arbitrators
Rule 12409 Arbitrator Recusal
Rule 12410 Removal of Arbitrator by Director
Rule 12411 Replacement of Arbitrators
Rule 12412 Director's Discretionary Authority
Rule 12413 Jurisdiction of Panel and Authority to Interpret the Code
Rule 12414 Determinations of Arbitration Panel
E. Part V—Prehearing Procedures and Discovery
 
Rule No. Rule Title
Rule 12500 Initial Prehearing Conference
Rule 12501 Other Prehearing Conferences
Rule 12502 Recording Prehearing Conferences
Rule 12503 Motions
Rule 12505 Cooperation of Parties in Discovery
Rule 12506 Document Production Lists
Rule 12507 Other Discovery Requests
Rule 12508 Objecting to Discovery; Waiver of Objection
Rule 12509 Motions to Compel Discovery
Rule 12510 Depositions
Rule 12511 Discovery Sanctions
Rule 12512 Subpoenas
Rule 12513 Authority of Panel to Direct Appearances of Associated Person Witnesses and Production of Documents Without Subpoenas
Rule 12514 Exchange of Documents and Witness Lists Before Hearing
F. Part VI—Hearings; Evidence; Closing the Record
 
Rule No. Rule Title
Rule 12600 Required Hearings
Rule 12601 Postponement of Hearings
Rule 12602 Attendance at Hearings
Rule 12603 Failure to Appear
Rule 12604 Evidence
Rule 12605 Witness Oath
Rule 12606 Record of Proceedings
Rule 12607 Order of Presentation of Evidence and Arguments
Rule 12608 Closing the Record
Rule 12609 Reopening the Record
G. Part VII—Termination of an Arbitration Before Award
 
Rule No. Rule Title
Rule 12700 Dismissal of Proceedings Prior to Award
Rule 12701 Settlement
Rule 12702 Withdrawal of Claims
H. Part VIII—Simplified Arbitration and Default Proceedings
 
Rule No. Rule Title
Rule 12800 Simplified Arbitration
Rule 12801 Default Proceedings
I. Part IX—Fees and Awards
 
Rule No. Rule Title
Rule 12900 Fees Due When a Claim Is Filed
Rule 12901 Member Surcharge
Rule 12902 Hearing Session Fees, and Other Costs and Expenses
Rule 12903 Process Fees Paid by Members
Rule 12904 Awards
VII. Rule 13000 Series—Code of Arbitration Procedure for Industry Disputes
A. Part I—Interpretive Material, Definitions, Organization and Authority
 
Rule No. Rule Title
IM-13000 Failure to Act Under Provisions of Code of Arbitration Procedure for Industry Disputes
Rule 13100 Definitions
Rule 13101 Applicability of Code and Incorporation by Reference
Rule 13102 National Arbitration and Mediation Committee
Rule 13103 Director of Dispute Resolution
Rule 13104 Effect of Arbitration on FINRA Regulatory Activities
Rule 13105 Agreement of the Parties
B. Part II—General Arbitration Rules
 
Rule No. Rule Title
Rule 13200 Required Arbitration
Rule 13201 Statutory Employment Discrimination Claims
Rule 13202 Claims Involving Registered Clearing Agencies
Rule 13203 Denial of FINRA Forum
Rule 13204 Class Action Claims
Rule 13205 Shareholder Derivative Actions
Rule 13206 Time Limits
Rule 13207 Extension of Deadlines
Rule 13208 Representation of Parties
Rule 13209 Legal Proceedings
Rule 13210 Ex Parte Communications
Rule 13211 Direct Communication Between Parties and Arbitrators
Rule 13212 Sanctions
Rule 13213 Hearing Locations
Rule 13214 Payment of Arbitrators
C. Part III—Initiating and Responding to Claims
 
Rule No. Rule Title
Rule 13300 Filing and Serving Documents
Rule 13301 Service on Associated Persons
Rule 13302 Filing an Initial Statement of Claim
Rule 13303 Answering the Statement of Claim
Rule 13304 Answering Counterclaims
Rule 13305 Answering Cross Claims
Rule 13306 Answering Third Party Claims
Rule 13307 Deficient Claims
Rule 13308 Loss of Defenses Due to Untimely or Incomplete Answer
Rule 13309 Amending Pleadings
Rule 13310 Answering Amended Claims
Rule 13311 Amendments to Amount in Dispute
Rule 13312 Multiple Claimants
Rule 13313 Multiple Respondents
Rule 13314 Combining Claims
D. Part IV—Appointment, Disqualification, and Authority of Arbitrators
 
Rule No. Rule Title
Rule 13400 Neutral List Selection System and Arbitrator Rosters
Rule 13401 Number of Arbitrators
Rule 13402 Composition of Arbitration Panels Not Involving a Statutory Discrimination Claim
Rule 13403 Generating and Sending Lists to the Parties
Rule 13404 Striking and Ranking Arbitrators
Rule 13405 Combining Lists
Rule 13406 Appointment of Arbitrators; Discretion to Appoint Arbitrators Not on List
Rule 13407 Additional Parties
Rule 13408 Disclosures Required of Arbitrators
Rule 13409 Arbitrator Recusal
Rule 13410 Removal of Arbitrator by Director
Rule 13411 Replacement of Arbitrators
Rule 13412 Director's Discretionary Authority
Rule 13413 Jurisdiction of Panel and Authority to Interpret the Code
Rule 13414 Determinations of Arbitration Panel
E. Part V—Prehearing Procedures and Discovery
 
Rule No. Rule Title
Rule 13500 Initial Prehearing Conference
Rule 13501 Other Prehearing Conferences
Rule 13502 Recording Prehearing Conferences
Rule 13503 Motions
Rule 13505 Cooperation of Parties in Discovery
Rule 13506 Discovery Requests
Rule 13507 Responding to Discovery Requests
Rule 13508 Objecting to Discovery Requests; Waiver of Objection
Rule 13509 Motions to Compel Discovery
Rule 13510 Depositions
Rule 13511 Discovery Sanctions
Rule 13512 Subpoenas
Rule 13513 Authority of Panel to Direct Appearances of Associated Person Witnesses and Production of Documents Without Subpoenas
Rule 13514 Exchange of Documents and Witness Lists Before Hearing
F. Part VI—Hearings; Evidence; Closing the Record
 
Rule No. Rule Title
Rule 13600 Required Hearings
Rule 13601 Postponement of Hearings
Rule 13602 Attendance at Hearings
Rule 13603 Failure to Appear
Rule 13604 Evidence
Rule 13605 Witness Oath
Rule 13606 Record of Proceedings
Rule 13607 Order of Presentation of Evidence and Arguments
Rule 13608 Closing the Record
Rule 13609 Reopening the Record
G. Part VII—Termination of an Arbitration Before Award
 
Rule No. Rule Title
Rule 13700 Dismissal of Proceedings Prior to Award
Rule 13701 Settlement
Rule 13702 Withdrawal of Claims
H. Part VIII—Simplified Arbitration; Default Proceedings; Statutory Employment Discrimination Claims; and Injunctive Relief
 
Rule No. Rule Title
Rule 13800 Simplified Arbitration
Rule 13801 Default Proceedings
Rule 13802 Statutory Employment Discrimination Claims
Rule 13803 Coordination of Statutory Employment Discrimination Claims Filed in Court and in Arbitration
Rule 13804 Temporary Injunctive Orders; Requests for Permanent Injunctive Relief
I. Part IX—Fees and Awards
 
Rule No. Rule Title
Rule 13900 Fees Due When a Claim Is Filed
Rule 13901 Member Surcharge
Rule 13902 Hearing Session Fees, and Other Costs and Expenses
Rule 13903 Process Fees Paid by Members
Rule 13904 Awards
VIII. Rule 14000 Series—Code of Mediation Procedure
Rule No. Rule Title
Rule 14100 Definitions
Rule 14101 Applicability of Code
Rule 14102 National Arbitration and Mediation Committee
Rule 14103 Director of Mediation
Rule 14104 Mediation under the Code
Rule 14105 Effect of Mediation on Arbitration Proceedings
Rule 14106 Representation of Parties
Rule 14107 Mediator Selection
Rule 14108 Limitation on Liability
Rule 14109 Mediation Ground Rules
Rule 14110 Mediation Fees

FINRA Rule Filing SR-FINRA-2008-025

www.finra.org/Industry/Regulation/RuleFilings/2008/P038707

The rule change transfers NASD Rule 2790 (Restrictions on the Purchase and Sale of Initial Equity Public Offerings) in substantially the same form to the Consolidated FINRA Rulebook as FINRA Rule 5130. The rule change makes minor, technical changes to the rule to reflect, for example, the registration of the NASDAQ Stock Market, LLC as a national securities exchange.

FINRA Rule 5130 protects the integrity of the initial public offering (IPO) process by ensuring that: (1) firms make bona fide public offerings of securities at the offering price; (2) firms do not withhold securities in a public offering for their own benefit or use such securities to reward persons who are in a position to direct future business to firms; and (3) industry insiders, including firms and their associated persons, do not take advantage of their insider position to purchase new issues for their own benefit at the expense of public customers. FINRA Rule 5130 plays an important part in maintaining investor confidence in the capital raising and IPO process.

Rule No. Rule Title
Rule 5130 Restrictions on the Purchase and Sale of Initial Equity Public Offerings

FINRA Rule Filing SR-FINRA-2008-026

www.finra.org/Industry/Regulation/RuleFilings/2008/P038730

The rule change adopts the NASD Rule 0100 Series (General Provisions) as FINRA Rules in the Consolidated FINRA Rulebook, with the exception of NASD Rule 0120, which will be addressed at a later date in a separate filing. The NASD Rule 0100 Series governs the adoption, application and interpretation of NASD rules and sets forth certain definitions not contained in the FINRA By-Laws. Additionally, these rules address FINRA's delegation of certain responsibilities to its subsidiaries, and its authority and access with respect to its subsidiaries. FINRA is transferring this rule series as the FINRA Rule 0100 Series, renamed as "General Standards," to the Consolidated FINRA Rulebook, with only minor changes. FINRA notes that, notwithstanding their transfer to the Consolidated FINRA Rulebook, these rules of general applicability apply equally to both the Transitional Rulebook and the Consolidated FINRA Rulebook.

Rule/Series No. Rule /Series Title
Rule 0100 Series General Standards
Rule 0110 Adoption of Rules
Rule 0120 Effective Date
Rule 0130 Interpretation
Rule 0140 Applicability
Rule 0150 Application of Rules to Exempted Securities Except Municipal Securities
Rule 0160 Definitions in FINRA By-Laws
Rule 0170 Delegation, Authority and Access

FINRA Rule Filing SR-FINRA-2008-027

www.finra.org/Industry/Regulation/RuleFilings/2008/P038723

The rule change adopts without material change NASD Rules 3060 (Influencing or Rewarding Employees of Others) and 3090 (Transactions Involving Association and American Stock Exchange Employees) as FINRA Rules in the Consolidated FINRA Rulebook and deletes the corresponding provisions in Incorporated NYSE Rules 350, 350.10, 407(a), 407.10 and NYSE Rule Interpretations 350/01 through 350/03. The rule change renumbers NASD Rule 3060 as FINRA Rule 3220 and NASD Rule 3090 as FINRA Rule 2070 in the Consolidated FINRA Rulebook.

FINRA Rule 3220 (Influencing or Rewarding Employees of Others) states that no member or associated person shall give gifts or gratuities to an agent or employee of another person in excess of $100 per year where the gift or gratuity is in relation to the business of the employer of the recipient. The rule protects against improprieties that may arise when members or their associated persons give gifts or gratuities. FINRA Rule 2070 (Transactions Involving FINRA Employees) addresses conflicts of interest involving FINRA employees.

Rule No. Rule Title
Rule 2070 Transactions Involving FINRA Employees
Rule 3220 Influencing or Rewarding Employees of Others

FINRA Rule Filing SR-FINRA-2008-028

www.finra.org/Industry/Regulation/RuleFilings/2008/P038732

The rule change adopts NASD Rules 2110 (Standards of Commercial Honor and Principles of Trade), 2120 (Use of Manipulative, Deceptive or Other Fraudulent Devices), and 2290 (Fairness Opinions) as FINRA Rules in the Consolidated FINRA Rulebook without material change and deletes Incorporated NYSE Rule 401(a) (Business Conduct), Incorporated NYSE Rule 435 (Miscellaneous Prohibitions), with the exception of paragraph (5), and NYSE Rule Interpretations 401/01 and 401/02. The rule change renumbers NASD Rule 2110 as FINRA Rule 2010, NASD Rule 2120 as FINRA Rule 2020, and NASD Rule 2290 as FINRA Rule 5150 in the Consolidated FINRA Rulebook.

FINRA Rule 2010 requires members, in the conduct of their business, to observe high standards of commercial honor and just and equitable principles of trade. Rule 2010 protects investors and the securities industry from dishonest practices that are unfair to investors or hinder the functioning of a free and open market, even though those practices may not be illegal or violate a specific rule or regulation. FINRA Rule 2020 is FINRA's general antifraud provision. FINRA has used this broad rule to address a wide variety of manipulative, deceptive, and fraudulent misconduct, including market manipulation, excessive trading, insider trading, and fraudulent misrepresentation. FINRA Rule 5150 requires specific disclosures and procedures addressing the conflicts of interest that arise when a broker-dealer provides a fairness opinion in a change of control transaction, such as a merger or sale or purchase of assets.

Rule No. Rule Title
Rule 2010 Standards of Commercial Honor and Principles of Trade
Rule 2020 Use of Manipulative, Deceptive or Other Fraudulent Devices
Rule 5150 Fairness Opinions

FINRA Rule Filing SR-FINRA-2008-030

www.finra.org/Industry/Regulation/RuleFilings/2008/P038786

The rule change adopts NASD Rule 3013 (Annual Certification of Compliance and Supervisory Processes) and IM-3013 (Annual Compliance and Supervision Certification) as a FINRA Rule in the Consolidated FINRA Rulebook without material change and deletes the corresponding provisions in Incorporated NYSE Rule 342.30 and NYSE Rule Interpretations 311(b)(5)/04 through /05 and 342.30(d)/01 through (e)/01. The rule change renumbers NASD Rule 3013 and IM-3013 as FINRA Rule 3130 in the Consolidated FINRA Rulebook.

FINRA Rule 3130 requires each member firm to designate one or more principals to serve as a chief compliance officer (CCO). The rule further requires that the chief executive officer(s) (CEO) certify annually that the member has in place processes to establish, maintain, review, modify and test policies and procedures reasonably designed to achieve compliance with applicable FINRA rules, MSRB rules and federal securities laws and regulations.

Rule No. Rule Title
Rule 3130 Annual Certification of Compliance and Supervisory Processes

FINRA Rule Filing SR-FINRA-2008-033

www.finra.org/Industry/Regulation/RuleFilings/2008/P038813

The rule change adopts the short interest reporting requirements (NASD Rule 3360 and Incorporated NYSE Rules 421(1) and 421.10) as FINRA Rule 4560 (Short-Interest Reporting) in the Consolidated FINRA Rulebook. FINRA Rule 4560 requires members to report short positions in OTC Equity Securities and exchange-listed securities. Members must report total short positions in all customer and proprietary accounts as of the settlement dates designated, and in the manner prescribed, by FINRA. (Currently, such information must be reported twice a month and is, in turn, made publicly available on an aggregate basis twice a month.)

Rule No. Rule Title
Rule 4560 Short-Interest Reporting

FINRA Rule Filing SR-FINRA-2008-039

www.finra.org/Industry/Regulation/RuleFilings/2008/P038926

The rule change (1) adopts NASD Rule 2710 (Corporate Financing Rule—Underwriting Terms and Arrangements), without material change except for paragraphs (b)(10) and (11), as a FINRA Rule in the Consolidated FINRA Rulebook and (2) clarifies and streamlines the notice and other requirements in FINRA Rules relating to Regulation M under the Securities Exchange Act (including paragraphs (b)(10) and (11) of NASD Rule 2710 and paragraph (a) of Incorporated NYSE Rule 392). The rule change renumbers NASD Rule 2710 as FINRA Rule 5110 and adopts new FINRA Rules 5190 and 6470 in the Consolidated FINRA Rulebook. (New FINRA Rule 5190 houses the Regulation M-related notice requirements applicable to members participating in securities offerings, including paragraphs (b)(10) and (11) of NASD Rule 2710 and paragraph (a) of Incorporated NYSE Rule 392. New FINRA Rule 6470 houses certain Regulation M-related requirements that are currently in the OTC Bulletin Board rules and applies to all OTC Equity Securities.)

Rule No. Rule Title
Rule 5110 Corporate Financing Rule—Underwriting Terms and Arrangements
Rule 5190 Notification Requirements for Offering Participants
Rule 6470 Withdrawal of Quotations in an OTC Equity Security in Compliance with SEC Regulation M

FINRA Rule Filing SR-FINRA-2008-022

www.finra.org/Industry/Regulation/RuleFilings/2008/P038543

The rule change addresses the applicability of the consolidated FINRA Rules to member firms of the NYSE that became members of FINRA pursuant to the membership waive-in process set in forth in NASD IM-1013-1 (Membership Waive-In Process for Certain New York Stock Exchange Member Organizations) (such firms are referred to as Waive-In Firms). Specifically, the rule change amends IM-1013-1 to specify that the Waive-In Firms will be subject to FINRA's By-Laws and Schedules to By-Laws, including Schedule A, the consolidated FINRA Rules and the Incorporated NYSE Rules, provided that their securities business is limited to the permitted floor activities. If a Waive-In Firm seeks to expand its business operations to include any activities other than the permitted floor activities, the firm must continue to apply for and receive approval pursuant to NASD Rule 1017. Upon approval of such expansion, the firm would be subject to all NASD Rules, in addition to the consolidated FINRA Rules and the Incorporated NYSE Rules.

FINRA Rule Filing SR-FINRA-2008-029

www.finra.org/Industry/Regulation/RuleFilings/2008/P038766

The rule change repeals NASD Rule 1130 (Reliance on Current Membership List) and Incorporated NYSE Rules 405A (Non-Managed Fee-Based Account Programs—Disclosure and Monitoring), 440F (Public Short Sale Transactions Effected on the Exchange), 440G (Transactions in Stocks and Warrants for the Accounts of Members, Allied Members and Member Organizations) and 477 (Retention of Jurisdiction—Failure to Cooperate) to eliminate duplicative provisions and remove requirements that are specific to the NYSE marketplace.


1 FINRA Rule 6121 took effect on October 7, 2008, pursuant to a separate filing. See Exchange Act Release No. 58753 (October 8, 2008), 73 FR 61177 (October 15, 2008) (Notice of Filing and Immediate Effectiveness of Proposed Rule Change; File No. SR-FINRA-2008-048). Rule 6121 permits FINRA to halt over-the-counter trading in NMS stocks, as defined in Rule 600(b)(47) of SEC Regulation NMS, if other major U.S. securities markets initiate market-wide trading halts in response to extraordinary market conditions or if otherwise directed by the SEC.

2 FINRA Rule 6560 corresponds to NASD Rule 6541 in the Transitional Rulebook. FINRA has deleted NASD Rule 6541, effective November 11, 2008, pursuant to separate filings. Accordingly, FINRA does not intend to implement Rule 6560 when the other FINRA Rules included in this Notice become effective. See Regulatory Notice 08-49 (September 2008) (Trading Ahead of Customer Limit Orders); see also Exchange Act Release No. 58532 (September 12, 2008), 73 FR 54649 (September 22, 2008) (Order Approving Proposed Rule Change; File No. SR-NASD-2007-041); Exchange Act Release No. 55351 (February 26, 2007), 72 FR 9810 (March 5, 2007) (Order Granting Accelerated Approval of Proposed Rule Change; File No. SR-NASD-2005-146).

3 FINRA has deleted FINRA Rule 7610B pursuant to a separate filing, effective October 20, 2008. (FINRA Rule 7610B corresponds to NASD Rule 7001C in the Transitional Rulebook.) See File No. SR-FINRA-2008-050. Accordingly, FINRA does not intend to implement Rule 7610B when the other FINRA Rules included in this Notice become effective.