80 FR 34777 - Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing of a Proposed Rule Change To Provide a Web-Based Delivery Method for Completing the Regulatory Element of the Continuing Education Requirements
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 116 (June 17, 2015)
Federal Register Volume 80, Issue 116 (June 17, 2015)
| Page Range | 34777-34781 | |
| FR Document | 2015-14828 |
[Federal Register Volume 80, Number 116 (Wednesday, June 17, 2015)] [Notices] [Pages 34777-34781] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-14828] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-75154; File No. SR-FINRA-2015-015] Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing of a Proposed Rule Change To Provide a Web-Based Delivery Method for Completing the Regulatory Element of the Continuing Education Requirements June 11, 2015. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice [[Page 34778]] is hereby given that on June 4, 2015, Financial Industry Regulatory Authority, Inc. (``FINRA'') filed with the Securities and Exchange Commission (``SEC'' or ``Commission'') the proposed rule change as described in Items I and II below, which Items have been prepared by FINRA. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change FINRA is proposing to amend FINRA Rule 1250 (Continuing Education Requirements) to provide a Web-based delivery method for completing the Regulatory Element of the Continuing Education (``CE'') requirements and to amend Section 4(f) of Schedule A to the FINRA By-Laws to establish the fee for the Web-based delivery of the Regulatory Element. The proposed rule change would phase out the current option of completing the Regulatory Element in a test center as well as the current option for in-firm delivery of the Regulatory Element. In addition, FINRA is proposing to delete NASD Rule 1043 (Proctors of In-Firm Delivery of Regulatory Element), Incorporated NYSE Rule 345A (Continuing Education for Registered Persons) \3\ and NYSE Rule Interpretation 345A (Continuing Education for Registered Persons). --------------------------------------------------------------------------- \3\ For convenience, the proposed rule change refers to Incorporated NYSE Rules as NYSE Rules. --------------------------------------------------------------------------- The text of the proposed rule change is available on FINRA's Web site at http://www.finra.org, at the principal office of FINRA and at the Commission's Public Reference Room. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, FINRA included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. FINRA has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose Background The CE requirements under FINRA Rule 1250 consist of a Regulatory Element \4\ and a Firm Element.\5\ --------------------------------------------------------------------------- \4\ See FINRA Rule 1250(a) (Regulatory Element). \5\ See FINRA Rule 1250(b) (Firm Element). --------------------------------------------------------------------------- The Regulatory Element applies to registered persons \6\ and consists of periodic computer-based training on regulatory, compliance, ethical, and supervisory subjects and sales practice standards, which must be completed within prescribed time frames.\7\ In addition, a registered person is required to retake the Regulatory Element in the event such person is: (1) Subject to a statutory disqualification as defined by Section 3(a)(39) of the Act; (2) subject to a suspension or imposition of a fine of $5,000 or more by a self-regulatory organization (SRO) or securities governmental agency; or (3) ordered to do so as a sanction in a disciplinary action by an SRO or a securities governmental agency. There are four Regulatory Element programs: (1) The S106 for Investment Company and Variable Contracts Representatives; (2) the S201 for registered principals and supervisors; (3) the S901 for Operations Professionals; and (4) the S101 for all other registration categories. Currently, the Regulatory Element may be administered in a test center or in-firm subject to specified procedures.\8\ --------------------------------------------------------------------------- \6\ For purposes of the Regulatory Element, a ``registered person'' is defined as any person registered with FINRA as a representative, principal, assistant representative or Research Analyst. See FINRA Rule 1250(a)(5) (Definition of Registered Person). \7\ Pursuant to FINRA Rule 1250(a), each registered person is required to complete the Regulatory Element initially within 120 days after the person's second registration anniversary date and, thereafter, within 120 days after every third registration anniversary date. Any registered person who has not completed the Regulatory Element program within the prescribed time frames will have his or her FINRA registrations deemed inactive and designated as ``CE inactive'' on the Central Registration Depository (CRD[supreg]) system until such time as the requirements of the program have been satisfied. A CE inactive person is prohibited from performing, or being compensated for, any activities requiring registration, including supervision. See also Notice to Members 95- 35 (Continuing Education Program Update: Regulatory Element Questions and Answers) (May 1995). Moreover, if a registered person is CE inactive for a two-year period, FINRA will administratively terminate the person's registration status with FINRA. The two-year period would be calculated from the date the person becomes CE inactive. If a registered person becomes CE inactive but is not registered with a member when the two-year period ends, FINRA will nevertheless update the CRD system to reflect that the person did not satisfy the Regulatory Element program. In either case, such person must reapply for registration and requalify (or obtain a waiver of the applicable qualification examination(s)) to be eligible to register again. \8\ The in-firm delivery procedures require, among other things, that (1) the firm designate a principal to be responsible for the in-firm delivery; (2) the delivery site be under the control of the firm and in an appropriate location and layout; (3) the firm satisfy the technology standards defined by FINRA or its designated vendor; (4) the firm's written supervisory procedures specify the in-firm delivery procedures; (5) the in-firm sessions be administered by a proctor who will be responsible for ensuring compliance with the required procedures and for monitoring the candidates; (6) appointments be scheduled in advance using the procedures and software specified by FINRA to communicate with FINRA's system and designated vendor; (7) the firm maintain and preserve a sign-in log; and (8) firms file a signed letter or attestation with FINRA prior to commencing in-firm delivery. See FINRA Rule 1250(a)(6) (In-Firm Delivery of the Regulatory Element). --------------------------------------------------------------------------- In addition, NASD Rule 1043 requires that an associated person designated as a proctor by a firm for the purposes of the in-firm delivery of the Regulatory Element be registered as a Proctor with FINRA through the filing of a Form U4 (Uniform Application for Securities Industry Registration or Transfer); \9\ provided that an associated person who is already registered with FINRA in another registration category, such as a General Securities Representative, may be designated as a proctor by a firm without having to register as a Proctor with FINRA. --------------------------------------------------------------------------- \9\ Proctors are not subject to a qualification examination. Further, an associated person who is registered solely as a Proctor is not qualified to function in any registered capacity other than a proctor for in-firm delivery. --------------------------------------------------------------------------- The Firm Element consists of annual, member-developed and administered training programs designed to keep covered registered persons \10\ current regarding securities products, services and strategies offered by the member. --------------------------------------------------------------------------- \10\ For purposes of the Firm Element, the term ``covered registered persons'' is defined as any registered persons who have direct contact with customers in the conduct of the member's securities sales, trading and investment banking activities, any person registered as an Operations Professional pursuant to FINRA Rule 1230(b)(6) (Operations Professional) or a Research Analyst pursuant to NASD Rule 1050 (Registration of Research Analysts), and the immediate supervisors of such persons. See FINRA Rule 1250(b)(1) (Persons Subject to the Firm Element). --------------------------------------------------------------------------- NYSE Rule 345A and NYSE Rule Interpretation 345A include corresponding requirements.\11\ --------------------------------------------------------------------------- \11\ See also NYSE Information Memorandum 02-49 (November 2002). --------------------------------------------------------------------------- Today, most registered persons complete the Regulatory Element in a test center rather than in-firm. Given advances in Web-based technology, FINRA believes that there is diminishing utility in the test center and in-firm delivery methods. Moreover, members and registered persons have raised concerns with the test center [[Page 34779]] delivery method because of the travel involved, the limited time currently available to complete a Regulatory Element session \12\ and the use of rigorous security measures at test centers, which are appropriate for taking qualification examinations but onerous for a CE program. Also, the test center delivery method is expensive to operate. --------------------------------------------------------------------------- \12\ The current session time is 3\1/2\ hours. --------------------------------------------------------------------------- In response to the issues noted above, FINRA engaged in extensive outreach with the industry and completed a pilot of a Web delivery system for administering the Regulatory Element. The proposed Web-based system performed well during the pilot in terms of both performance and accessibility. FINRA also received positive feedback from firms and the individual pilot participants. Among other things, pilot participants appreciated the expanded time to focus on the provided learning materials without the pressure of a timed session and the ability to resume or complete their session from where they left off. Proposal Based on FINRA's evaluation of different delivery methods and consultation with the Securities Industry Regulatory Council on Continuing Education (``CE Council''),\13\ FINRA is proposing to provide a Web-based delivery method for completing the Regulatory Element. Specifically, FINRA is proposing to amend FINRA Rule 1250(a)(6) to provide that the Regulatory Element program will be administered through Web-based delivery or such other technological manner and format as specified by FINRA. In addition to allowing the use of Web-based delivery, the proposed rule change would allow FINRA to adopt different delivery methods in the future based on technology changes without having to amend the rule each time. However, FINRA will notify members through a Regulatory Notice of any future changes to the delivery method. --------------------------------------------------------------------------- \13\ The CE Council is composed of up to 20 industry members from broker-dealers, representing a broad cross section of industry firms, and representatives from FINRA and other SROs as well as liaisons from the SEC and the North American Securities Administrators Association. --------------------------------------------------------------------------- FINRA would like to launch the first phase of Web-based delivery, which will include the S106, S201 and S901 Regulatory Element programs, on October 1, 2015. FINRA would like to launch the second phase of Web- based delivery, which will include the S101 Regulatory Element program, on January 4, 2016. FINRA is proposing to phase out test-center delivery by no later than six months after January 4, 2016. Registered persons will continue to have the option of completing the Regulatory Element in a test center until the phase out of the test center delivery method, but they will be required to use the Web-based system after that date. Further, FINRA is proposing to phase out the current option for in- firm delivery on a rolling basis as each Regulatory Element program becomes available for Web-based delivery. Firms will not be able to establish new in-firm delivery programs after October 1, 2015. Moreover, firms that have pre-existing in-firm delivery programs established prior to October 1, 2015 would not be able to use that delivery method for the S106, S201 and S901 Regulatory Element programs after October 1, 2015, which is the anticipated launch date of Web- based delivery for these programs. However, such firms may continue to use their pre-existing in-firm delivery programs for the S101 Regulatory Element program until January 4, 2016, which is the anticipated launch date of Web-based delivery for the S101 program. FINRA is also proposing to eliminate NASD Rule 1043 relating to the registration of Proctors for in-firm delivery. FINRA is proposing to automatically terminate the Proctor registration category in the CRD system on January 4, 2016, which, as noted above, is the launch date of the second phase of Web-based delivery. Therefore, associated persons who are registered as Proctors in the CRD system will not be required to take any actions. The proposed Web-based delivery method will provide registered persons the flexibility to complete the Regulatory Element at a location of their choosing, including their private residence, at any time during their 120-day window for completion of the Regulatory Element.\14\ --------------------------------------------------------------------------- \14\ While the proposed rule change provides such flexibility, firms may choose to impose their own conditions based on their supervisory and compliance needs. For instance, a firm that wishes to have registered persons complete CE on the firm's premises can do so by having the registered person access Web-based CE from a firm device and location. Moreover, firms would have to update their written policies and procedures regarding the Regulatory Element to reflect the transition to Web-based CE and communicate the update to registered persons. --------------------------------------------------------------------------- In addition, Web-based delivery will significantly reduce the cost to the industry. The current fee for test-center and in-firm deliveries is $100 per session.\15\ In-firm deliveries receive a three dollar rebate per session. FINRA is proposing to amend Section 4(f) of Schedule A to the FINRA By-Laws to assess a fee of $55 for each candidate who completes the Regulatory Element via the Web-based delivery method.\16\ FINRA is also proposing to amend Section 4(f) of Schedule A to the FINRA By-Laws to clarify that registered persons will not be required to complete the Regulatory Element in a test center or via the in-firm method during the phase-out period. --------------------------------------------------------------------------- \15\ There are also additional fees for taking the session outside the United States, failing to appear on time for an appointment or cancelling or rescheduling an appointment. See Section 4 of Schedule A to the FINRA By-Laws. \16\ FINRA is not proposing any changes to the session fees for test-center and in-firm deliveries until it has completed the phase- out process described above. --------------------------------------------------------------------------- The Web-based format will include safeguards to authenticate the identity of the CE candidate. For instance, prior to commencing a Web- based session, the candidate will be asked to provide a portion of their SSN (either first five or last four digits) and their date of birth. This information will only be used for matching data in the CRD system. The Web CE system will discard this information after the matching process. Further, before commencing a Web-based session, FINRA will require that each candidate agree to the Rules of Conduct for Web-based delivery. Among other things, the Rules of Conduct will require each candidate to attest that he or she is in fact the person who is taking the Web-based session. The Rules of Conduct will also require that each candidate agree that the Regulatory Element content is the intellectual property of FINRA and that the content cannot be copied or redistributed by any means. If FINRA discovers that a candidate has violated the Rules of Conduct, the candidate will forfeit the results of the Web-based session and may be subject to disciplinary action by FINRA.\17\ Violation of the Rules of Conduct will be considered conduct inconsistent with high standards of commercial honor and just and equitable principles of trade, in violation of FINRA Rule 2010 (Standards of Commercial Honor and Principles of Trade).\18\ --------------------------------------------------------------------------- \17\ For instance, for cheating on the Regulatory Element, FINRA's Sanction Guidelines recommend a bar. See FINRA Sanction Guidelines at 40 (2013 [sic]), http://www.finra.org/sites/default/files/Sanctions_Guidelines.pdf. \18\ Further, an associated person that assists another associated person in violating the Rules of Conduct will also be considered to have violated FINRA Rule 2010. Firms must also consider whether they have an obligation to report violations of the Rules of Conduct to FINRA. For instance, FINRA Rule 4530.01 (Reporting of Firms' Conclusions of Violations) requires a firm to report, among other things, if it concludes that an associated person has engaged in multiple instances of any violative conduct. --------------------------------------------------------------------------- [[Page 34780]] FINRA is not proposing any changes to the Firm Element requirements under FINRA Rule 1250(b). FINRA is proposing to delete NYSE Rule 345A and NYSE Rule Interpretation 345A in their entirety as they are substantially similar to FINRA Rule 1250. FINRA will announce the effective date of the proposed rule change, which FINRA intends for October 2015, in a Regulatory Notice to be published no later than 90 days following Commission approval. 2. Statutory Basis FINRA believes that the proposed rule change is consistent with the provisions of Section 15A(b)(6) of the Act,\19\ which requires, among other things, that FINRA rules must be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, and, in general, to protect investors and the public interest, and Section 15A(g)(3) of the Act,\20\ which authorizes FINRA to prescribe standards of training, experience, and competence for persons associated with FINRA members. --------------------------------------------------------------------------- \19\ 15 U.S.C. 78o-3(b)(6). \20\ 15 U.S.C. 78o-3(g)(3). --------------------------------------------------------------------------- FINRA believes that the proposed rule change will improve members' compliance efforts and will allow registered persons to spend a greater amount of time on the review of CE materials and potentially achieve better learning outcomes, which will in turn enhance investor protection. Further, while the proposed rule change will provide more flexibility to members and registered persons, it will maintain the integrity of the CE program. B. Self-Regulatory Organization's Statement on Burden on Competition FINRA does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. FINRA notes that the proposed rule change is specifically intended to reduce the burden on firms while preserving the integrity of the CE program. As described above, the Web-based delivery method will provide registered persons the flexibility to complete the Regulatory Element at any location that they choose. Further, Web-based delivery is efficient and offers significant cost savings over test-center and in- firm deliveries. With respect to the authentication process for Web- based delivery, the CE candidate's personal identifying information will be masked and will be submitted to FINRA through a secure, encrypted, network. The personal identifying information submitted via the Web-based system will be used for authentication purposes only--the information will not be stored in the Web-based system. Economic Impact Assessment (a) Need for the Rule As discussed above, FINRA believes that there is diminishing utility in the test-center and in-firm delivery of the Regulatory Element given advances in Web-based technology. Moreover, members and registered persons have raised concerns with the test center delivery method because of the travel involved, the limited time currently available to complete a Regulatory Element session and the use of rigorous security measures at test centers. In addition, the test center delivery method is expensive to operate and support. (b) Regulatory Objective The proposed rule change is intended to reduce the burden on firms while preserving the integrity of the CE program. (c) Economic Baseline The proposed Web-based delivery method will affect members and registered persons through changes in the fee, location and allotted time for Regulatory Element sessions. The average annual in-firm and test-center deliveries over the past three years are 1,174 and 207,474, respectively. The current fee for in-firm and test-center deliveries is typically $100 per session. In addition, the Regulatory Element must be completed at a test center or in-firm subject to specific conditions, and the current Regulatory Element session time is 3\1/2\ hours. The proposed rule change will permit FINRA to provide CE training at a reduced cost, reduce the fee for the Regulatory Element session and provide registered persons with more flexibility regarding the location and allotted time to complete the session. The proposed Web-based delivery of the Regulatory Element will also improve FINRA's ability to update content in response to rule changes and other industry demands. The current test center delivery method involves a multi-layered release and quality control process for implementing new content through the delivery vendors because FINRA and the delivery vendors each employ a release and quality control process. The overlapping processes, while necessary, require additional effort for FINRA staff to support. The proposed rule change will enable FINRA to update the content of the Regulatory Element directly and more efficiently through a single release and quality control process. (d) Economic Impacts The proposed Web-based delivery of the Regulatory Element will reduce direct and indirect costs of the program in a number of ways. First, the industry will benefit from the proposed decrease in the session fee from $100 to $55. Under the proposal, the total reduction in fees is estimated to be approximately $1 million in 2015, $9 million in 2016, and $11 million in 2017 compared to the fee structure of the test-center delivery. Second, in contrast with the test center delivery method, the proposed Web-based delivery will not involve travel, meaning that registered persons will not lose travel time in order to participate, or overly rigorous security measures. Registered persons will be able to complete the Regulatory Element at a location of their choosing, including their private residence. Third, the proposed Web- based delivery will not impose any limit on the session time other than the 120-day window for completion of the Regulatory Element. Under the proposed Web-based delivery method, registered persons will be able to spend a greater amount of time on the review of CE materials and potentially achieve better learning outcomes. The Web-based format will provide FINRA the ability to update content in response to rule changes and other industry changes on a more timely basis. Also, it will significantly reduce the effort and cost associated with a multi-layered release and quality control process for implementing new content through the delivery vendors. Therefore, the proposed rule change will likely improve regulatory efficiency, promote better education of associated persons and enhance investor protection. The proposed rule change is not expected to negatively impact the integrity of the CE program. The proposed Web-based delivery method will include safeguards to authenticate the identity of the CE candidate. Further, before commencing a Web-based session, FINRA will require that each candidate agree to the Rules of Conduct for Web-based delivery. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others Written comments were neither solicited nor received. [[Page 34781]] III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the date of publication of this notice in the Federal Register or within such longer period up to 90 days (i) as the Commission may designate if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the self-regulatory organization consents, the Commission will: A. By order approve or disapprove such proposed rule change, or B. institute proceedings to determine whether the proposed rule change should be disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic CommentsUse the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to [email protected]. Please include File Number SR-FINRA-2015-015 on the subject line. Paper Comments Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-FINRA-2015-015. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of FINRA. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-FINRA-2015-015 and should be submitted on or before July 8, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\21\ --------------------------------------------------------------------------- \21\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2015-14828 Filed 6-16-15; 8:45 am] BILLING CODE 8011-01-P
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fee under fee code K would enable the believe that the proposed changes will number should be included on the
Exchange to equitably allocate its costs impair the ability of Members or subject line if email is used. To help the
among all Members utilizing fee code K. competing venues to maintain their Commission process and review your
The Exchange proposes to implement competitive standing in the financial comments more efficiently, please use
this amendment to its Fee Schedule markets. The Exchange believes that its only one method. The Commission will
immediately. proposal to pass through a fee of post all comments on the Commission’s
$0.0028 per share for Members’ orders Internet Web site (http://www.sec.gov/
2. Statutory Basis
that yield fee code K would increase rules/sro.shtml). Copies of the
The Exchange believes that the intermarket competition because it submission, all subsequent
proposed rule change is consistent with offers customers an alternative means to amendments, all written statements
the objectives of Section 6 of the Act,10 route to PSX. The Exchange believes with respect to the proposed rule
in general, and furthers the objectives of that its proposal would not burden change that are filed with the
Section 6(b)(4),11 in particular, as it is intramarket competition because the Commission, and all written
designed to provide for the equitable proposed rate would apply uniformly to communications relating to the
allocation of reasonable dues, fees and all Members. proposed rule change between the
other charges among its Members and Commission and any person, other than
other persons using its facilities. The (C) Self-Regulatory Organization’s
Statement on Comments on the those that may be withheld from the
Exchange believes that its proposal to public in accordance with the
increase the fee for Members’ orders that Proposed Rule Change Received From
Members, Participants or Others provisions of 5 U.S.C. 552, will be
yield fee code K from $0.0026 per share available for Web site viewing and
to $0.0028 per share represents an The Exchange has not solicited, and printing in the Commission’s Public
equitable allocation of reasonable dues, does not intend to solicit, comments on Reference Room, 100 F Street NE.,
fees, and other charges among Members this proposed rule change. The Washington, DC 20549, on official
and other persons using its facilities Exchange has not received any business days between the hours of
because the Exchange does not levy unsolicited written comments from 10:00 a.m. and 3:00 p.m. Copies of the
additional fees or offer additional Members or other interested parties. filing will also be available for
rebates for orders that it routes to PSX III. Date of Effectiveness of the inspection and copying at the principal
through BATS Trading. As of June 1, Proposed Rule Change and Timing for office of the Exchange. All comments
2015, PSX amended its fee to remove Commission Action received will be posted without change;
liquidity via routable order types it the Commission does not edit personal
charges its customers, from a fee of The foregoing rule change has become
effective pursuant to Section 19(b)(3)(A) identifying information from
$0.0029 per share to a fee of $0.0027 per submissions. You should submit only
share for Tapes A and B securities and of the Act 13 and paragraph (f) of Rule
19b–4 thereunder.14 At any time within information that you wish to make
$0.0028 per share for Tape C available publicly. All submissions
securities.12 Therefore, the Exchange 60 days of the filing of the proposed rule
change, the Commission summarily may should refer to File Number SR–EDGA–
believes that its proposal to pass 2015–23 and should be submitted on or
through a fee of $0.0028 per share for temporarily suspend such rule change if
it appears to the Commission that such before July 8,2015.
orders that yield fee code K is equitable
and reasonable because it accounts for action is necessary or appropriate in the For the Commission, by the Division of
the pricing changes on PSX. In addition, public interest, for the protection of Trading and Markets, pursuant to delegated
investors, or otherwise in furtherance of authority.15
the proposal allows the Exchange to
now charge its Members a pass-through the purposes of the Act. Robert W. Errett,
rate for orders that are routed to PSX. Deputy Secretary.
IV. Solicitation of Comments
Furthermore, the Exchange notes that [FR Doc. 2015–14820 Filed 6–16–15; 8:45 am]
Interested persons are invited to
routing through BATS Trading is submit written data, views, and
BILLING CODE 8011–01–P
voluntary. Lastly, the Exchange also arguments concerning the foregoing,
believes that the proposed amendment including whether the proposed rule
is non-discriminatory because it applies SECURITIES AND EXCHANGE
change is consistent with the Act. COMMISSION
uniformly to all Members. Comments may be submitted by any of
(B) Self-Regulatory Organization’s the following methods: [Release No. 34–75154; File No. SR–FINRA–
Statement on Burden on Competition 2015–015]
Electronic Comments
These proposed rule changes do not • Use the Commission’s Internet Self-Regulatory Organizations;
impose any burden on competition that comment form (http://www.sec.gov/ Financial Industry Regulatory
is not necessary or appropriate in rules/sro.shtml); or Authority, Inc.; Notice of Filing of a
furtherance of the purposes of the Act. • Send an email to rule-comments@ Proposed Rule Change To Provide a
The Exchange does not believe that any sec.gov. Please include File Number SR– Web-Based Delivery Method for
of these changes represent a significant EDGA–2015–23 on the subject line. Completing the Regulatory Element of
departure from previous pricing offered the Continuing Education
by the Exchange or pricing offered by Paper Comments
Requirements
• Send paper comments in triplicate
asabaliauskas on DSK5VPTVN1PROD with NOTICES
the Exchange’s competitors.
Additionally, Members may opt to to Brent J. Fields, Secretary, Securities June 11, 2015.
disfavor EDGA’s pricing if they believe and Exchange Commission, 100 F Street Pursuant to Section 19(b)(1) of the
that alternatives offer them better value. NE., Washington, DC 20549–1090. Securities Exchange Act of 1934
Accordingly, the Exchange does not All submissions should refer to File (‘‘Act’’) 1 and Rule 19b–4 thereunder,2
Number SR–EDGA–2015–23. This file
10 15 U.S.C. 78f. 15 17 CFR 200.30–3(a)(12).
11 15 U.S.C. 78f(b)(4). 13 15 U.S.C. 78s(b)(3)(A). 1 15 U.S.C. 78s(b)(1).
12 See supra note 6. 14 17 CFR 240.19b–4(f). 2 17 CFR 240.19b–4.
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delivery method because of the travel FINRA is proposing to phase out test- three dollar rebate per session. FINRA is
involved, the limited time currently center delivery by no later than six proposing to amend Section 4(f) of
available to complete a Regulatory months after January 4, 2016. Registered Schedule A to the FINRA By-Laws to
Element session 12 and the use of persons will continue to have the option assess a fee of $55 for each candidate
rigorous security measures at test of completing the Regulatory Element in who completes the Regulatory Element
centers, which are appropriate for taking a test center until the phase out of the via the Web-based delivery method.16
qualification examinations but onerous test center delivery method, but they FINRA is also proposing to amend
for a CE program. Also, the test center will be required to use the Web-based Section 4(f) of Schedule A to the FINRA
delivery method is expensive to operate. system after that date. By-Laws to clarify that registered
In response to the issues noted above, Further, FINRA is proposing to phase persons will not be required to complete
FINRA engaged in extensive outreach out the current option for in-firm the Regulatory Element in a test center
with the industry and completed a pilot delivery on a rolling basis as each or via the in-firm method during the
of a Web delivery system for Regulatory Element program becomes phase-out period.
administering the Regulatory Element. available for Web-based delivery. Firms The Web-based format will include
The proposed Web-based system will not be able to establish new in-firm safeguards to authenticate the identity
performed well during the pilot in terms delivery programs after October 1, 2015. of the CE candidate. For instance, prior
of both performance and accessibility. Moreover, firms that have pre-existing to commencing a Web-based session,
FINRA also received positive feedback in-firm delivery programs established the candidate will be asked to provide
from firms and the individual pilot prior to October 1, 2015 would not be a portion of their SSN (either first five
participants. Among other things, pilot able to use that delivery method for the or last four digits) and their date of
participants appreciated the expanded S106, S201 and S901 Regulatory birth. This information will only be
time to focus on the provided learning Element programs after October 1, 2015, used for matching data in the CRD
materials without the pressure of a which is the anticipated launch date of system. The Web CE system will discard
timed session and the ability to resume Web-based delivery for these programs. this information after the matching
or complete their session from where However, such firms may continue to process.
they left off. use their pre-existing in-firm delivery Further, before commencing a Web-
programs for the S101 Regulatory based session, FINRA will require that
Proposal Element program until January 4, 2016, each candidate agree to the Rules of
Based on FINRA’s evaluation of which is the anticipated launch date of Conduct for Web-based delivery. Among
different delivery methods and Web-based delivery for the S101 other things, the Rules of Conduct will
consultation with the Securities program. require each candidate to attest that he
Industry Regulatory Council on FINRA is also proposing to eliminate or she is in fact the person who is taking
Continuing Education (‘‘CE Council’’),13 NASD Rule 1043 relating to the the Web-based session. The Rules of
FINRA is proposing to provide a Web- registration of Proctors for in-firm Conduct will also require that each
based delivery method for completing delivery. FINRA is proposing to candidate agree that the Regulatory
the Regulatory Element. Specifically, automatically terminate the Proctor Element content is the intellectual
FINRA is proposing to amend FINRA registration category in the CRD system property of FINRA and that the content
Rule 1250(a)(6) to provide that the on January 4, 2016, which, as noted cannot be copied or redistributed by any
Regulatory Element program will be above, is the launch date of the second means. If FINRA discovers that a
administered through Web-based phase of Web-based delivery. Therefore, candidate has violated the Rules of
delivery or such other technological associated persons who are registered as Conduct, the candidate will forfeit the
manner and format as specified by Proctors in the CRD system will not be results of the Web-based session and
FINRA. In addition to allowing the use required to take any actions. may be subject to disciplinary action by
of Web-based delivery, the proposed The proposed Web-based delivery FINRA.17 Violation of the Rules of
rule change would allow FINRA to method will provide registered persons Conduct will be considered conduct
adopt different delivery methods in the the flexibility to complete the inconsistent with high standards of
future based on technology changes Regulatory Element at a location of their commercial honor and just and
without having to amend the rule each choosing, including their private equitable principles of trade, in
time. However, FINRA will notify residence, at any time during their 120- violation of FINRA Rule 2010
members through a Regulatory Notice of day window for completion of the (Standards of Commercial Honor and
any future changes to the delivery Regulatory Element.14 Principles of Trade).18
method. In addition, Web-based delivery will
FINRA would like to launch the first significantly reduce the cost to the on time for an appointment or cancelling or
industry. The current fee for test-center rescheduling an appointment. See Section 4 of
phase of Web-based delivery, which Schedule A to the FINRA By-Laws.
will include the S106, S201 and S901 and in-firm deliveries is $100 per 16 FINRA is not proposing any changes to the
Regulatory Element programs, on session.15 In-firm deliveries receive a session fees for test-center and in-firm deliveries
until it has completed the phase-out process
October 1, 2015. FINRA would like to 14 While the proposed rule change provides such described above.
launch the second phase of Web-based flexibility, firms may choose to impose their own 17 For instance, for cheating on the Regulatory
delivery, which will include the S101 conditions based on their supervisory and Element, FINRA’s Sanction Guidelines recommend
Regulatory Element program, on January compliance needs. For instance, a firm that wishes a bar. See FINRA Sanction Guidelines at 40 (2013
asabaliauskas on DSK5VPTVN1PROD with NOTICES
4, 2016. to have registered persons complete CE on the [sic]), http://www.finra.org/sites/default/files/
firm’s premises can do so by having the registered Sanctions_Guidelines.pdf.
person access Web-based CE from a firm device and 18 Further, an associated person that assists
12 The current session time is 31⁄2 hours. location. Moreover, firms would have to update another associated person in violating the Rules of
13 The CE Council is composed of up to 20 their written policies and procedures regarding the Conduct will also be considered to have violated
industry members from broker-dealers, representing Regulatory Element to reflect the transition to Web- FINRA Rule 2010. Firms must also consider
a broad cross section of industry firms, and based CE and communicate the update to registered whether they have an obligation to report violations
representatives from FINRA and other SROs as well persons. of the Rules of Conduct to FINRA. For instance,
as liaisons from the SEC and the North American 15 There are also additional fees for taking the FINRA Rule 4530.01 (Reporting of Firms’
Securities Administrators Association. session outside the United States, failing to appear Continued
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![Federal Register / Vol. 80, No. 116 / Wednesday, June 17, 2015 / Notices 34781
III. Date of Effectiveness of the office of FINRA. All comments received (Catalog of Federal Domestic Assistance
Proposed Rule Change and Timing for will be posted without change; the Numbers 59002 and 59008)
Commission Action Commission does not edit personal James E. Rivera,
Within 45 days of the date of identifying information from Associate Administrator for Disaster
publication of this notice in the Federal submissions. You should submit only Assistance.
Register or within such longer period information that you wish to make [FR Doc. 2015–14843 Filed 6–16–15; 8:45 am]
up to 90 days (i) as the Commission may available publicly. All submissions
BILLING CODE 8025–01–P
designate if it finds such longer period should refer to File Number SR–FINRA–
to be appropriate and publishes its 2015–015 and should be submitted on
reasons for so finding or (ii) as to which or before July 8, 2015. SMALL BUSINESS ADMINISTRATION
the self-regulatory organization For the Commission, by the Division of
[Disaster Declaration #14348 and #14349]
consents, the Commission will: Trading and Markets, pursuant to delegated
A. By order approve or disapprove authority.21
Massachusetts Disaster #MA–00065
such proposed rule change, or Robert W. Errett,
B. institute proceedings to determine Deputy Secretary. AGENCY: U.S. Small Business
whether the proposed rule change [FR Doc. 2015–14828 Filed 6–16–15; 8:45 am] Administration.
should be disapproved. ACTION: Notice.
BILLING CODE 8011–01–P
IV. Solicitation of Comments
SUMMARY: This is a notice of an
Interested persons are invited to Administrative declaration of a disaster
submit written data, views, and SMALL BUSINESS ADMINISTRATION for the Commonwealth of Massachusetts
arguments concerning the foregoing, dated 06/11/2015.
including whether the proposed rule [Disaster Declaration #14344 and #14345] Incident: Brookside Condominium
change is consistent with the Act. Complex Fire.
Comments may be submitted by any of Oklahoma Disaster Number OK–00081 Incident Period: 05/05/2015.
the following methods: AGENCY: U.S. Small Business Effective Date: 06/11/2015.
Electronic Comments Administration. Physical Loan Application Deadline
Date: 08/10/2015.
• Use the Commission’s Internet ACTION: Amendment 2.
Economic Injury (EIDL) Loan
comment form (http://www.sec.gov/ Application Deadline Date: 03/11/2016.
SUMMARY: This is an amendment of the
rules/sro.shtml); or ADDRESSES: Submit completed loan
• Send an email to rule-comments@ Presidential declaration of a major
disaster for Public Assistance Only for applications to: U.S. Small Business
sec.gov. Please include File Number SR–
the State of Oklahoma (FEMA–4222– Administration, Processing and
FINRA–2015–015 on the subject line.
DR), dated 06/04/2015. Disbursement Center, 14925 Kingsport
Paper Comments Incident: Severe Storms, Tornadoes, Road, Fort Worth, TX 76155.
• Send paper comments in triplicate Straight Line Winds, and Flooding. FOR FURTHER INFORMATION CONTACT: A.
to Secretary, Securities and Exchange Incident Period: 05/05/2015 through Escobar, Office of Disaster Assistance,
Commission, 100 F Street NE., 06/04/2015. U.S. Small Business Administration,
Washington, DC 20549–1090. Effective Date: 06/09/2015. 409 3rd Street SW., Suite 6050,
All submissions should refer to File Physical Loan Application Deadline Washington, DC 20416.
Number SR–FINRA–2015–015. This file Date: 08/03/2015. SUPPLEMENTARY INFORMATION: Notice is
number should be included on the Economic Injury (EIDL) Loan hereby given that as a result of the
subject line if email is used. To help the Application Deadline Date: 03/04/2016. Administrator’s disaster declaration,
Commission process and review your ADDRESSES: Submit completed loan applications for disaster loans may be
comments more efficiently, please use applications to: U.S. Small Business filed at the address listed above or other
only one method. The Commission will Administration, Processing and locally announced locations.
post all comments on the Commission’s Disbursement Center, 14925 Kingsport The following areas have been
Internet Web site (http://www.sec.gov/ Road, Fort Worth, TX 76155. determined to be adversely affected by
rules/sro.shtml). Copies of the FOR FURTHER INFORMATION CONTACT: A. the disaster:
submission, all subsequent Escobar, Office of Disaster Assistance, Primary Counties: Middlesex.
amendments, all written statements U.S. Small Business Administration, Contiguous Counties:
with respect to the proposed rule 409 3rd Street SW., Suite 6050, Massachusetts: Essex, Norfolk,
change that are filed with the Washington, DC 20416. Suffolk, Worcester.
Commission, and all written New Hampshire: Hillsborough.
SUPPLEMENTARY INFORMATION: The notice
communications relating to the The Interest Rates are:
of the President’s major disaster
proposed rule change between the
declaration for Private Non-Profit
Commission and any person, other than Percent
organizations in the State of Oklahoma,
those that may be withheld from the
dated 06/04/2015, is hereby amended to
public in accordance with the For Physical Damage:
include the following areas as adversely Homeowners With Credit
provisions of 5 U.S.C. 552, will be
asabaliauskas on DSK5VPTVN1PROD with NOTICES
affected by the disaster. Available Elsewhere .......... 3.375
available for Web site viewing and
printing in the Commission’s Public Primary Counties: Canadian; Carter; Homeowners Without Credit
Choctaw; Coal; Le Flore; Love; Murray; Available Elsewhere .......... 1.688
Reference Room, 100 F Street NE.,
Okmulgee; Pottawatomie. Businesses With Credit Avail-
Washington, DC 20549, on official able Elsewhere .................. 6.000
business days between the hours of All other information in the original Businesses Without Credit
10:00 a.m. and 3:00 p.m. Copies of the declaration remains unchanged. Available Elsewhere .......... 4.000
filing also will be available for Non-Profit Organizations With
inspection and copying at the principal 21 17 CFR 200.30–3(a)(12). Credit Available Elsewhere 2.625
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Document Created: 2015-12-15 14:22:54
Document Modified: 2015-12-15 14:22:54
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| Dates | Regulatory Element Questions and Answers) (May 1995). Moreover, if a registered person is CE inactive for a two-year period, FINRA will administratively terminate the person's registration status with FINRA. The two-year period would be calculated from the date the person becomes CE inactive. If a registered person becomes CE inactive but is not registered with a member when the two-year period ends, FINRA will nevertheless update the CRD system to reflect that the person did not satisfy the Regulatory Element program. In either case, such person must reapply for registration and requalify (or obtain a waiver of the applicable qualification examination(s)) to be eligible to register again. | |
| FR Citation | 80 FR 34777 |
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