80 FR 53375 - Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Order Approving Proposed Rule Change To Require Members To Report Transactions in TRACE-Eligible Securities as Soon as Practicable
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 171 (September 3, 2015)
Federal Register Volume 80, Issue 171 (September 3, 2015)
| Page Range | 53375-53377 | |
| FR Document | 2015-21868 |
[Federal Register Volume 80, Number 171 (Thursday, September 3, 2015)] [Notices] [Pages 53375-53377] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-21868] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-75782; File No. SR-FINRA-2015-025] Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Order Approving Proposed Rule Change To Require Members To Report Transactions in TRACE-Eligible Securities as Soon as Practicable August 28, 2015. I. Introduction On July 2, 2015, Financial Industry Regulatory Authority, Inc. (``FINRA'') filed with the Securities and Exchange Commission (``Commission''), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a proposed rule change to amend FINRA Rule 6730, which governs the reporting of eligible transactions to its Trade Reporting and Compliance Engine (``TRACE''). The proposed rule change was published for comment in the Federal Register on July 16, 2015.\3\ The Commission received two comment letters on the proposed rule change.\4\ FINRA responded to the comment letters on August 20, 2015.\5\ This order approves the proposed rule change. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. \3\ See Securities Exchange Act Release No. 75428 (July 10, 2015), 80 FR 42149. \4\ See letter from Darren Wasney, Program Manager, Financial Information Forum, to Robert W. Errett, Deputy Secretary, Commission, dated August 5, 2015 (``FIF Letter'') and letter from Michael Nicholas, Chief Executive Officer, Bond Dealers of America, to Secretary, Commission, dated August 6, 2015 (``BDA Letter''). \5\ See letter from Racquel L. Russell, Associate General Counsel, FINRA, to Robert W. Errett, Deputy Secretary, Commission, dated August 20, 2015 (``FINRA Response Letter''). --------------------------------------------------------------------------- II. Description of the Proposed Rule Change FINRA Rule 6730 currently requires that each FINRA member that is a Party to a Transaction \6\ in a TRACE-Eligible Security \7\ report the transaction within 15 minutes of the Time of Execution,\8\ unless a different time period for the security is otherwise specified in the rule. Otherwise, the transaction report will be deemed ``late.'' The proposed rule change amends Rule 6730 to provide that, for a TRACE- Eligible Security subject to dissemination, each member that is a Party to a Transaction must report the transaction to TRACE as soon as practicable, but no later than within 15 minutes of the Time of Execution or other timeframe specified in Rule 6730. Further, the proposed rule change adds new Supplementary Material .03 that requires members to adopt policies and procedures reasonably designed to comply with this amendedrequirement by implementing, without delay, systems that commence the trade reporting process at the Time of Execution. The proposed rule change also provides that, where a member has in place such reasonably designed policies, procedures, and systems, the member generally will not be viewed as violating the ``as soon as practicable'' reporting requirement because of delays that are due to extrinsic factors that are not reasonably predictable and where the member does not purposely intend to delay the reporting of the trade. The proposed rule change states that in no event may a member purposely withhold trade reports, for example, by programming its systems to delay reporting until the end of the reporting time period. --------------------------------------------------------------------------- \6\ FINRA Rule 6710(e) provides that a ``Party to a Transaction'' is an introducing broker-dealer, if any, an executing broker-dealer, or a customer. ``Customer'' includes a broker-dealer that is not a FINRA member. \7\ See FINRA Rule 6710(a) (defining ``TRACE-Eligible Security''). \8\ FINRA Rule 6710(d) provides, among other things, that the ``Time of Execution'' for a transaction in a TRACE-Eligible Security is the time when the Parties to a Transaction agree to all of the terms of the transaction that are sufficient to calculate the dollar price of the trade. --------------------------------------------------------------------------- The proposed rule change also recognizes that members may manually report transactions in TRACE-Eligible Securities and, as a result, the trade reporting process may not be completed as quickly as where an automated trade reporting system is used. FINRA states that, in these cases, in determining whether the member's policies and procedures are reasonably designed to report the trade ``as soon as practicable,'' it will take into consideration the manual nature of the member's trade reporting process. While the current rules provide time periods for members to conduct the necessary actions to report transactions, FINRA cites concerns about members delaying the reporting of executed transactions, particularly, for example, by imbedding into the trade reporting process deliberate delays until the end of the reporting time period. FINRA also represents that it observed instances that appear to indicate that firms have taken more time than is operationally necessary to report trades, which raises the possibility that certain firms may have intentionally delayed trade reporting, possibly to delay public dissemination of the trade. FINRA believes that such conduct is inconsistent with the purpose of the trade reporting rules and that it is [[Page 53376]] important for public price transparency that members do not delay reporting executed transactions. FINRA already has taken certain steps to deter such conduct. Paragraph (a)(4) of Rule 6730 currently provides that members have an ongoing obligation to report transaction information promptly, accurately, and completely. In addition, FINRA previously has conveyed its expectation, through regulatory notices, that members not delay the reporting of transactions through certain communications with its members.\9\ FINRA now believes that Rule 6730 should be explicitly amended to prohibit delays, thereby promoting consistent and timely reporting by all members and improving the usefulness of disseminated TRACE information for regulators, investors, and other market participants. FINRA also states that the proposed rule change will clarify that intentionally delaying trade reporting is violative of a member's ongoing obligation to report transaction information to TRACE promptly. --------------------------------------------------------------------------- \9\ See, e.g., Trade Reporting Notice, May 10, 2011 (Reporting Asset-Backed Securities to the Trade Reporting and Compliance Engine) (although firms have up to two business days to report transactions in ABSs, firms should submit reports as soon as practicable after the execution of a transaction and throughout the trading day, rather than queuing such reports until the end of the reporting time period); Regulatory Notice 12-52 (December 2012) (transactions in securities subject to TRACE reporting requirements should be reported without delay, even though the TRACE rule generally allows for up to 15 minutes to report transactions in corporate and agency debt securities). --------------------------------------------------------------------------- FINRA anticipates that the proposal will not impose any significant new compliance costs on members. FINRA also represents that it understands that the vast majority of firms that report transactions to TRACE have automated their trade reporting systems, which may facilitate their ability to comply with the proposed rule change.\10\ FINRA acknowledges the additional timing needs for firms that manually report their TRACE trades and represents that it will consider those needs when evaluating the policies and procedures of those members. --------------------------------------------------------------------------- \10\ FINRA provided statistics, based on a review of TRACE trade reporting data from January 2014 through December 2014, that over 90% of trade reports in corporate and agency debt were submitted within five minutes of the time of execution and 79% were reported within one minute. Furthermore, approximately 71% of trade reports in securitized products were submitted within five minutes of execution, and over 55% were reported within one minute. --------------------------------------------------------------------------- III. Summary of Comments and FINRA's Response As noted above, the Commission received two comment letters on the proposed rule change \11\ and a response letter from FINRA.\12\ The comment letters and FINRA's response are summarized below. --------------------------------------------------------------------------- \11\ See supra note 4. \12\ See supra note 5. --------------------------------------------------------------------------- The FIF Letter requests clarification regarding how the proposed rule change would apply to member firms and suggests that FINRA only include language explicitly stating that intentionally delaying reporting would constitute a violation of Rule 6730. The FIF Letter also suggests that FINRA eliminate the ``as soon as practicable'' language included in the proposed rule change.\13\ --------------------------------------------------------------------------- \13\ See FIF Letter at 1-2. --------------------------------------------------------------------------- FINRA rejects this suggested change. While intentionally delaying reporting would constitute a violation of the proposed rule, FINRA states that the proposal puts an affirmative obligation on firms to implement efficient reporting systems, a goal that goes beyond the policing of intentional delays. FINRA notes the importance of price transparency to the investing public and the marketplace overall and states that each member should take steps to ensure that transaction information is reported promptly without taking more time than is operationally necessary.\14\ --------------------------------------------------------------------------- \14\ See FINRA Response Letter at 1-2. --------------------------------------------------------------------------- The FIF Letter also asks whether firms may be deemed in violation of the proposed rule under certain scenarios. The Letter inquires, for example, whether brokers, due to using different data providers and having different internal workflows, have different reporting time requirements.\15\ Further, the FIF Letter also asks whether firms would be expected to modify existing systems to comply with the proposed rule change.\16\ --------------------------------------------------------------------------- \15\ See FIF Letter at 2. \16\ See FIF Letter at 2. --------------------------------------------------------------------------- In its response letter, FINRA recognizes that members' processes around TRACE reporting are diverse and may differ depending on the degree of automation, the method of order receipt and execution, and other factors. FINRA also states that it understands a certain amount of time is operationally needed for reporting and that its rule text acknowledged this. FINRA states that compliance with the rule would hinge on whether the member firm's policies and procedures are reasonably designed to report trades as soon as practicable by having systems that commence reporting at the time of execution without delay.\17\ It also states that, if a member currently has such policies and procedures, then no further changes would be required to comply with the proposed rule change.\18\ --------------------------------------------------------------------------- \17\ See FINRA Response Letter at 2. \18\ See FINRA Response Letter at 3. --------------------------------------------------------------------------- The BDA Letter generally supports the proposal but suggests that FINRA alter the wording of the proposed rule text to read that members ``generally will not be viewed as violating the `as soon as practicable' requirement because of delays in trade reporting that are due to the facts and circumstances of the transaction.'' \19\ The BDA Letter cites some examples of intrinsic factors that it states can cause reporting delays, including changes in staff, routine day-to-day business and personnel issues, and transactions in complex securitized products or by telephone, which may require additional time for reporting. The BDA Letter states that firms experiencing reporting delays due to such factors should not be considered out of compliance.\20\ --------------------------------------------------------------------------- \19\ See BDA Letter at 1-2. The proposed rule provides that delays due to ``extrinsic factors that are not reasonably predictable'' will generally not be viewed as violative of Rule 6730. \20\ See BDA Letter at 2-3. --------------------------------------------------------------------------- FINRA, in response, states that it agrees that the facts and circumstances of a transaction are one of the factors that may be considered in determining whether a transaction was reported as soon as practicable, but rejects the suggested modification. FINRA states that the intent of the proposed rule language is to provide comfort to members experiencing delays resulting from unpredictable extrinsic factors, which are by their nature outside of a member's control. FINRA further provides that the predictable and routine factors noted by the BDA Letter (such as staff turnover, voice transactions, and trading in new or complex security types) are factors that should be considered when designing reporting systems to facilitate prompt transaction reporting. FINRA acknowledges, however, that the particulars of what operationally is necessary to report a specific trade or type of trade legitimately may vary depending on the circumstances.\21\ --------------------------------------------------------------------------- \21\ See FINRA Letter 3-4. --------------------------------------------------------------------------- IV. Discussion and Commission Findings After careful review, the Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities association.\22\ In particular, the Commission finds that the proposed [[Page 53377]] rule change is consistent with Section 15A(b)(2) of the Act,\23\ which requires, among other things, that FINRA be so organized and have the capacity to be able to carry out the purposes of the Act, to comply with the Act, and to enforce compliance by FINRA members and persons associated with members with the Act, the rules and regulations thereunder, and FINRA rules. The Commission also finds the proposed rule change consistent with Section 15A(b)(6) of the Act,\24\ 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. --------------------------------------------------------------------------- \22\ In approving this proposed rule change, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). \23\ 15 U.S.C. 78o-3(b)(2). \24\ 15 U.S.C. 78o-3(b)(6). --------------------------------------------------------------------------- The Commission believes that the proposed rule change is reasonably designed to clarify the manner in which firms must comply with existing FINRA Rule 6730(a)(4). The Commission believes that it is consistent with the Act for FINRA to explicitly prohibit the delay of transaction reporting and to require members to establish and implement policies and procedures that are reasonably designed to comply with the TRACE reporting requirement as amended. The Commission believes that the proposed rule change will promote timely trade reporting and thereby enhance public price transparency, consistent with the protection of investors and public interest. The Commission notes that FINRA recognizes that members may manually report transactions in TRACE-Eligible Securities and, as a result, the trade reporting process may not be completed as quickly as where an automated trade reporting system is used. The Commission believes it is appropriate that, in these cases, FINRA would take into consideration the manual nature of the member's trade reporting process in determining whether its policies and procedures are reasonably designed to report the trade ``as soon as practicable.'' The Commission also notes that one commenter suggested removing the ``as soon as practicable'' requirement, while another commenter, who supported the requirement, suggested modifications to the proposed rule text to account for intrinsic factors that may delay reporting. Further, both commenters raised concerns about certain circumstances that may affect the timeliness of trade reporting, including the variations in member reporting mechanisms, routine business matters, or the complexity of the securities traded. The Commission believes FINRA's decision not to modify the rule text as suggested by the commenters is appropriate. The Commission notes that FINRA acknowledges that reporting processes differ by member firm and by security and that its rule text already accounted for this. As FINRA notes, compliance with the rule would hinge on whether the member firm's policies and procedures are reasonably designed to report trades as soon as practicable by having systems that commence reporting at the time of execution without delay. The Commission also notes that FINRA acknowledges that the facts and circumstances of a particular transaction are among the factors that may be considered in determining whether a transaction was reported as soon as practicable. Moreover, FINRA states that routine and predictable factors that affect the timing of reporting should be accounted for when a member designs policies, procedures, and systems for trade reporting, in contrast to unpredictable, extrinsic factors, which are by their nature outside of a member's control. While the proposed rule would require firms to undertake an assessment of existing policies and procedures for compliance with the rule and may entail some additional costs for member firms that do not already have policies and procedures in place to report trades as soon as practicable, the Commission believes the proposed rule is be reasonably designed to achieve compliance with FINRA rules and the applicable federal securities law and regulations. Therefore, for the foregoing reasons, the Commission finds that the proposed rule change is consistent with the Act. V. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,\25\ that the proposed rule change (SR-FINRA-2015-025), be, and hereby is, approved. --------------------------------------------------------------------------- \25\ 15 U.S.C. 78s(b)(2). \26\ 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\26\ Robert W. Errett, Deputy Secretary. [FR Doc. 2015-21868 Filed 9-2-15; 8:45 am] BILLING CODE 8011-01-P
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consistent with the Act. Comments may SECURITIES AND EXCHANGE rule. Otherwise, the transaction report
be submitted by any of the following COMMISSION will be deemed ‘‘late.’’ The proposed
methods: rule change amends Rule 6730 to
[Release No. 34–75782; File No. SR–FINRA–
2015–025]
provide that, for a TRACE-Eligible
Electronic Comments Security subject to dissemination, each
• Use the Commission’s Internet Self-Regulatory Organizations; member that is a Party to a Transaction
comment form (http://www.sec.gov/ Financial Industry Regulatory must report the transaction to TRACE as
rules/sro.shtml); or Authority, Inc.; Order Approving soon as practicable, but no later than
Proposed Rule Change To Require within 15 minutes of the Time of
• Send an email to rule- Execution or other timeframe specified
comments@sec.gov. Please include File Members To Report Transactions in
TRACE-Eligible Securities as Soon as in Rule 6730. Further, the proposed rule
No. SR–EDGA–2015–34 on the subject change adds new Supplementary
line. Practicable
Material .03 that requires members to
August 28, 2015. adopt policies and procedures
Paper Comments
I. Introduction reasonably designed to comply with this
• Send paper comments in triplicate amendedrequirement by implementing,
to Secretary, Securities and Exchange On July 2, 2015, Financial Industry without delay, systems that commence
Commission, 100 F Street NE., Regulatory Authority, Inc. (‘‘FINRA’’) the trade reporting process at the Time
Washington, DC 20549–1090. filed with the Securities and Exchange of Execution. The proposed rule change
Commission (‘‘Commission’’), pursuant also provides that, where a member has
All submissions should refer to File No. to Section 19(b)(1) of the Securities in place such reasonably designed
SR–EDGA–2015–34. This file number Exchange Act of 1934 (‘‘Act’’) 1 and Rule policies, procedures, and systems, the
should be included on the subject line 19b–4 thereunder,2 a proposed rule member generally will not be viewed as
if email is used. To help the change to amend FINRA Rule 6730, violating the ‘‘as soon as practicable’’
Commission process and review your which governs the reporting of eligible reporting requirement because of delays
comments more efficiently, please use transactions to its Trade Reporting and that are due to extrinsic factors that are
only one method. The Commission will Compliance Engine (‘‘TRACE’’). The not reasonably predictable and where
post all comments on the Commission’s proposed rule change was published for the member does not purposely intend
Internet Web site (http://www.sec.gov/ comment in the Federal Register on July to delay the reporting of the trade. The
rules/sro.shtml). Copies of the 16, 2015.3 The Commission received proposed rule change states that in no
submission, all subsequent two comment letters on the proposed event may a member purposely
amendments, all written statements rule change.4 FINRA responded to the withhold trade reports, for example, by
with respect to the proposed rule comment letters on August 20, 2015.5 programming its systems to delay
change that are filed with the This order approves the proposed rule reporting until the end of the reporting
Commission, and all written change. time period.
communications relating to the The proposed rule change also
II. Description of the Proposed Rule
proposed rule change between the Change recognizes that members may manually
Commission and any person, other than report transactions in TRACE-Eligible
those that may be withheld from the FINRA Rule 6730 currently requires Securities and, as a result, the trade
public in accordance with the that each FINRA member that is a Party reporting process may not be completed
provisions of 5 U.S.C. 552, will be to a Transaction 6 in a TRACE-Eligible as quickly as where an automated trade
available for Web site viewing and Security 7 report the transaction within reporting system is used. FINRA states
printing in the Commission’s Public 15 minutes of the Time of Execution,8 that, in these cases, in determining
Reference Room, 100 F Street NE., unless a different time period for the whether the member’s policies and
Washington, DC 20549, on official security is otherwise specified in the procedures are reasonably designed to
business days between the hours of report the trade ‘‘as soon as
1 15 U.S.C. 78s(b)(1).
10:00 a.m. and 3:00 p.m. Copies of such 2 17
practicable,’’ it will take into
CFR 240.19b–4.
filing will also be available for 3 See Securities Exchange Act Release No. 75428 consideration the manual nature of the
inspection and copying at the principal (July 10, 2015), 80 FR 42149. member’s trade reporting process.
office of the Exchange. All comments 4 See letter from Darren Wasney, Program While the current rules provide time
received will be posted without change; Manager, Financial Information Forum, to Robert periods for members to conduct the
the Commission does not edit personal W. Errett, Deputy Secretary, Commission, dated necessary actions to report transactions,
August 5, 2015 (‘‘FIF Letter’’) and letter from
identifying information from Michael Nicholas, Chief Executive Officer, Bond FINRA cites concerns about members
submissions. You should submit only Dealers of America, to Secretary, Commission, delaying the reporting of executed
information that you wish to make dated August 6, 2015 (‘‘BDA Letter’’). transactions, particularly, for example,
5 See letter from Racquel L. Russell, Associate
available publicly. All submissions by imbedding into the trade reporting
General Counsel, FINRA, to Robert W. Errett,
should refer to File No. SR–EDGA– Deputy Secretary, Commission, dated August 20,
process deliberate delays until the end
2015–34 and should be submitted on or 2015 (‘‘FINRA Response Letter’’). of the reporting time period. FINRA also
before September 24, 2015. 6 FINRA Rule 6710(e) provides that a ‘‘Party to a represents that it observed instances
For the Commission, by the Division of
Transaction’’ is an introducing broker-dealer, if any, that appear to indicate that firms have
an executing broker-dealer, or a customer. taken more time than is operationally
Trading and Markets, pursuant to delegated ‘‘Customer’’ includes a broker-dealer that is not a
authority.28 FINRA member. necessary to report trades, which raises
tkelley on DSK3SPTVN1PROD with NOTICES
7 See FINRA Rule 6710(a) (defining ‘‘TRACE- the possibility that certain firms may
Robert W. Errett,
Eligible Security’’). have intentionally delayed trade
Deputy Secretary. 8 FINRA Rule 6710(d) provides, among other reporting, possibly to delay public
[FR Doc. 2015–21872 Filed 9–2–15; 8:45 am] things, that the ‘‘Time of Execution’’ for a dissemination of the trade. FINRA
transaction in a TRACE-Eligible Security is the time
BILLING CODE 8011–01–P
when the Parties to a Transaction agree to all of the
believes that such conduct is
terms of the transaction that are sufficient to inconsistent with the purpose of the
28 17 CFR 200.30–3(a)(12). calculate the dollar price of the trade. trade reporting rules and that it is
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rule change is consistent with Section or the complexity of the securities SECURITIES AND EXCHANGE
15A(b)(2) of the Act,23 which requires, traded. COMMISSION
among other things, that FINRA be so The Commission believes FINRA’s
organized and have the capacity to be decision not to modify the rule text as [Release No. IC–31799; File No. 812–14396]
able to carry out the purposes of the Act, suggested by the commenters is
to comply with the Act, and to enforce Full Circle Capital Corporation et al.;
appropriate. The Commission notes that Notice of Application
compliance by FINRA members and
FINRA acknowledges that reporting
persons associated with members with August 28, 2015.
the Act, the rules and regulations processes differ by member firm and by
security and that its rule text already AGENCY: Securities and Exchange
thereunder, and FINRA rules. The
accounted for this. As FINRA notes, Commission (‘‘Commission’’).
Commission also finds the proposed
rule change consistent with Section compliance with the rule would hinge ACTION: Notice of application for an
15A(b)(6) of the Act,24 which requires, on whether the member firm’s policies order pursuant to section 57(i) of the
among other things, that FINRA rules and procedures are reasonably designed Investment Company Act of 1940 (the
must be designed to prevent fraudulent to report trades as soon as practicable by ‘‘Act’’) and rule 17d–1 under the Act to
and manipulative acts and practices, to having systems that commence permit certain joint transactions
promote just and equitable principles of reporting at the time of execution otherwise prohibited by section 57(a)(4)
trade, and, in general, to protect without delay. The Commission also of the Act and rule 17d–1 under the Act.
investors and the public interest. notes that FINRA acknowledges that the
SUMMARY: Applicants request an order to
The Commission believes that the facts and circumstances of a particular permit a business development
proposed rule change is reasonably transaction are among the factors that company (‘‘BDC’’) and certain affiliated
designed to clarify the manner in which may be considered in determining investment funds to co-invest in
firms must comply with existing FINRA whether a transaction was reported as portfolio companies with each other and
Rule 6730(a)(4). The Commission soon as practicable. Moreover, FINRA with other affiliated investment funds.
believes that it is consistent with the states that routine and predictable APPLICANTS: Full Circle Capital
Act for FINRA to explicitly prohibit the factors that affect the timing of reporting Corporation (the ‘‘Company’’), Full
delay of transaction reporting and to should be accounted for when a member Circle Private Investments LLC (‘‘FCPI
require members to establish and designs policies, procedures, and Fund’’), Full Circle Healthcare Capital,
implement policies and procedures that systems for trade reporting, in contrast LLC (the ‘‘Healthcare Fund,’’ and
are reasonably designed to comply with to unpredictable, extrinsic factors, together with FCPI Fund, the ‘‘Existing
the TRACE reporting requirement as which are by their nature outside of a Funds’’), Full Circle Advisors, LLC (the
amended. The Commission believes that member’s control. ‘‘Adviser’’), Full Circle West, Inc., FC
the proposed rule change will promote
While the proposed rule would New Media, Inc., TransAmerican Asset
timely trade reporting and thereby
require firms to undertake an Servicing Group, Inc., FC New Specialty
enhance public price transparency,
assessment of existing policies and Foods, Inc. and FC Takoda Holdings,
consistent with the protection of
procedures for compliance with the rule LLC, (collectively, the ‘‘Full Circle
investors and public interest.
and may entail some additional costs for Subsidiaries,’’ and together with the
The Commission notes that FINRA
member firms that do not already have Company, the Existing Funds and the
recognizes that members may manually
policies and procedures in place to Adviser, the ‘‘Applicants’’).
report transactions in TRACE-Eligible
Securities and, as a result, the trade report trades as soon as practicable, the DATES: Filing Dates: The application was
reporting process may not be completed Commission believes the proposed rule filed on December 4, 2014 and amended
as quickly as where an automated trade is be reasonably designed to achieve on May 1, 2015.
reporting system is used. The compliance with FINRA rules and the HEARING OR NOTIFICATION OF HEARING: An
Commission believes it is appropriate applicable federal securities law and order granting the requested relief will
that, in these cases, FINRA would take regulations. be issued unless the Commission orders
into consideration the manual nature of a hearing. Interested persons may
Therefore, for the foregoing reasons, request a hearing by writing to the
the member’s trade reporting process in
the Commission finds that the proposed Commission’s Secretary and serving
determining whether its policies and
rule change is consistent with the Act. applicants with a copy of the request,
procedures are reasonably designed to
report the trade ‘‘as soon as V. Conclusion personally or by mail. Hearing requests
practicable.’’ should be received by the Commission
The Commission also notes that one It is therefore ordered, pursuant to by 5:30 p.m. on September 22, 2015,
commenter suggested removing the ‘‘as Section 19(b)(2) of the Act,25 that the and should be accompanied by proof of
soon as practicable’’ requirement, while proposed rule change (SR–FINRA– service on applicants, in the form of an
another commenter, who supported the 2015–025), be, and hereby is,approved. affidavit or, for lawyers, a certificate of
requirement, suggested modifications to service. Pursuant to rule 0–5 under the
For the Commission, by the Division of
the proposed rule text to account for Act, hearing requests should state the
Trading and Markets, pursuant to delegated
intrinsic factors that may delay authority.26
nature of the writer’s interest, any facts
reporting. Further, both commenters bearing upon the desirability of a
Robert W. Errett, hearing on the matter, the reason for the
raised concerns about certain
Deputy Secretary. request, and the issues contested.
tkelley on DSK3SPTVN1PROD with NOTICES
circumstances that may affect the
timeliness of trade reporting, including [FR Doc. 2015–21868 Filed 9–2–15; 8:45 am] Persons who wish to be notified of a
the variations in member reporting BILLING CODE 8011–01–P hearing may request notification by
mechanisms, routine business matters, writing to the Commission’s Secretary.
ADDRESSES: Secretary, U.S. Securities
23 15 U.S.C. 78o–3(b)(2). 25 15 U.S.C. 78s(b)(2). and Exchange Commission, 100 F St.,
24 15 U.S.C. 78o–3(b)(6). 26 17 CFR 200.30–3(a)(12). NE., Washington, DC 20549–1090.
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Document Created: 2015-12-15 09:56:40
Document Modified: 2015-12-15 09:56:40
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| FR Citation | 80 FR 53375 |
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