83 FR 9050 - Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Revise the Private Securities Offerings Representative (Series 82) Examination
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 83, Issue 42 (March 2, 2018)
Federal Register Volume 83, Issue 42 (March 2, 2018)
| Page Range | 9050-9053 | |
| FR Document | 2018-04210 |
[Federal Register Volume 83, Number 42 (Friday, March 2, 2018)] [Notices] [Pages 9050-9053] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-04210] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-82774; File No. SR-FINRA-2018-011] Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Revise the Private Securities Offerings Representative (Series 82) Examination February 26, 2018. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on February 12, 2018, 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, II, and III below, which Items have been prepared by FINRA. FINRA has designated the proposed rule change as ``constituting a stated policy, practice, or interpretation with respect to the meaning, administration, or enforcement of an existing rule'' under Section 19(b)(3)(A)(i) of the Act \3\ and [[Page 9051]] Rule 19b-4(f)(1) thereunder,\4\ which renders the proposal effective upon receipt of this filing by the Commission. 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. \3\ 15 U.S.C. 78s(b)(3)(A)(i). \4\ 17 CFR 240.19b-4(f)(1). --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change FINRA is proposing revisions to the content outline and selection specifications for the Private Securities Offerings Representative (Series 82) examination as part of the restructuring of the representative-level examination program.\5\ The proposed revisions also update the material to reflect changes to the laws, rules and regulations covered by the examination and to incorporate the functions and associated tasks currently performed by a Private Securities Offerings Representative. In addition, FINRA is proposing to make changes to the format of the content outline. FINRA is not proposing any textual changes to the By-Laws, Schedules to the By-Laws or Rules of FINRA. --------------------------------------------------------------------------- \5\ FINRA also is proposing corresponding revisions to the Series 82 question bank. Based on instruction from SEC staff, FINRA is submitting this filing for immediate effectiveness pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-4(f)(1) thereunder, and is not filing the question bank. See Letter to Alden S. Adkins, Senior Vice President and General Counsel, NASD Regulation, from Belinda Blaine, Associate Director, Division of Market Regulation, SEC, dated July 24, 2000. The question bank is available for SEC review. --------------------------------------------------------------------------- The revised Series 82 content outline is attached.\6\ The revised Series 82 selection specifications have been submitted to the Commission under separate cover with a request for confidential treatment pursuant to SEA Rule 24b-2.\7\ --------------------------------------------------------------------------- \6\ The Commission notes that the content outline is attached to the filing, not to this Notice. \7\ 17 CFR 240.24b-2. --------------------------------------------------------------------------- The text of the proposed rule change is available on FINRA's website at http://www.finra.org, at the principal office of FINRA and at the Commission's Public Reference Room. [sic] 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 Section 15A(g)(3) of the Act \8\ authorizes FINRA to prescribe standards of training, experience, and competence for persons associated with FINRA members. In accordance with that provision, FINRA has developed examinations that are designed to establish that persons associated with FINRA members have attained specified levels of competence and knowledge, consistent with applicable registration requirements under FINRA rules. FINRA periodically reviews the content of the examinations to determine whether revisions are necessary or appropriate in view of changes pertaining to the subject matter covered by the examinations. --------------------------------------------------------------------------- \8\ 15 U.S.C. 78o-3(g)(3). --------------------------------------------------------------------------- The SEC recently approved a proposed rule change to restructure the FINRA representative-level qualification examination program.\9\ The rule change, which will become effective on October 1, 2018,\10\ restructures the examination program into a new format whereby all new representative-level applicants will be required to take a general knowledge examination (the Securities Industry Essentials or SIETM) and a tailored, specialized knowledge examination (a revised representative-level qualification examination) for their particular registered role. --------------------------------------------------------------------------- \9\ See Securities Exchange Act Release No. 81098 (July 7, 2017), 82 FR 32419 (July 13, 2017) (Order Approving File No. SR- FINRA-2017-007). \10\ See Regulatory Notice 17-30 (SEC Approves Consolidated FINRA Registration Rules, Restructured Representative-Level Qualification Examinations and Changes to Continuing Education Requirements) (October 2017). --------------------------------------------------------------------------- The restructured program eliminates duplicative testing of general securities knowledge on the current representative-level qualification examinations by moving such content into the SIE examination.\11\ The SIE examination will test fundamental securities-related knowledge, including knowledge of basic products, the structure and function of the securities industry, the regulatory agencies and their functions and regulated and prohibited practices, whereas the revised representative-level qualification examinations will test knowledge relevant to day-to-day activities, responsibilities and job functions of representatives.\12\ --------------------------------------------------------------------------- \11\ Each of the current representative-level examinations covers general securities knowledge, with the exception of the Research Analyst (Series 86 and 87) examinations. \12\ FINRA filed the SIE content outline with the SEC for immediate effectiveness. See Securities Exchange Act Release No. 82578 (January 24, 2018), 83 FR 4375 (January 30, 2018) (Notice of Filing and Immediate Effectiveness of File No. SR-FINRA-2018-002). In addition to the proposed rule change relating to the revised Series 82 examination, FINRA is filing with the Commission for immediate effectiveness the content outlines for the other revised representative-level qualification examinations. --------------------------------------------------------------------------- As part of the restructuring process and in consultation with a committee of industry representatives, FINRA undertook a review of the Private Securities Offerings Representative (Series 82) examination to remove the general securities knowledge currently covered on the examination and to create a tailored examination to test knowledge relevant to the day-to-day activities, responsibilities and job functions of a Private Securities Offerings Representative. As a result of this review, FINRA also is proposing to revise the Series 82 content outline to reflect changes to the laws, rules and regulations covered by the examination and to incorporate the functions and associated tasks currently performed by a Private Securities Offerings Representative. The proposed change will align the organization of the Series 82 content outline with the organization of the content outlines of the other revised representative-level examinations.\13\ In addition, FINRA is proposing to make other changes to the format of the Series 82 content outline. --------------------------------------------------------------------------- \13\ FINRA currently has organized several FINRA qualification examinations, such as the Securities Trader (Series 57) examination, based on the functions that are performed by the respective registered persons and the associated tasks. FINRA is proposing similar layouts for all of the representative-level examinations, including the Series 82 examination. --------------------------------------------------------------------------- Beginning on October 1, 2018, new applicants seeking to register as Private Securities Offerings Representatives must pass the SIE examination and the revised Private Securities Offerings Representative (Series 82) examination. Current Content Outline The current Series 82 content outline is divided into four sections. The following are the four sections, denoted Section 1 through Section 4, with the associated number of questions: 1. Characteristics of Corporate Securities, 13 questions; 2. Regulation of The Market for Registered and Unregistered Securities, 45 questions; 3. Analyzing Corporate Securities and Investment Planning, 16 questions; and [[Page 9052]] 4. Handling Customer Accounts and Industry Regulations, 26 questions. In addition, each section includes references to the applicable laws, rules and regulations associated with that section. The current content outline also includes a preface (addressing, among other things, the purpose, administration and scoring of the examination), sample questions and reference materials. Revised Content Outline As noted above, FINRA is proposing to move the general securities knowledge currently covered on the Series 82 examination to the SIE examination. For example, FINRA Rule 3220 (Influencing or Rewarding Employees of Others) (the Gifts Rule) will now be tested on the SIE examination, rather than on the Series 82 examination. As a result, the revised Series 82 examination will test knowledge specific to the day- to-day activities, responsibilities and job functions of a Private Securities Offerings Representative. Further, FINRA is proposing to reorganize the content outline by dividing it into four major job functions that are performed by a Private Securities Offerings Representative. The proposed change aligns the major job functions performed by a Private Securities Offerings Representative with the major job functions performed by other sales representatives, including Investment Company and Variable Contracts Products Representatives, General Securities Representatives and Direct Participation Programs Representatives. The following are the four major job functions, denoted Function 1 through Function 4, with the associated number of questions: Function 1: Seeks Business for the Broker-Dealer from Customers and Potential Customers, 25 questions; Function 2: Opens Accounts After Obtaining and Evaluating Customers' Financial Profile and Investment Objectives, 9 questions; Function 3: Provides Customers with Information About Investments, Makes Suitable Recommendations, Transfers Assets and Maintains Appropriate Records, 13 questions; and Function 4: Obtains and Verifies Customers' Purchase Instructions and Agreements; Processes, Completes and Confirms Transactions, 3 questions. FINRA also is proposing to adjust the number of questions assigned to each major job function to ensure that the overall examination better reflects the key tasks performed by a Private Securities Offerings Representative. The questions on the revised Series 82 examination will place emphasis on tasks such as seeking business for the broker-dealer from customers and potential customers, opening customer accounts, providing customers with suitable recommendations and verifying customer agreements and transactions. Each function also includes specific tasks describing activities associated with performing that function. There are two tasks (1.1-1.2) associated with Function 1; \14\ four tasks (2.1-2.4) associated with Function 2; \15\ four tasks (3.1-3.4) associated with Function 3; \16\ and two tasks (4.1-4.2) associated with Function 4.\17\ For example, one such task (Task 1.1) is contacting current and potential customers in person and by telephone, mail and electronic means, developing promotional and advertising materials and seeking appropriate approvals to distribute marketing materials.\18\ The content outline also lists the knowledge required to perform each function and associated tasks (e.g., standards and required approvals of communications). In addition, where applicable, the content outline lists the laws, rules and regulations a candidate is expected to know to perform each function and associated tasks (e.g., FINRA Rule 2111 (Suitability)). --------------------------------------------------------------------------- \14\ See Exhibit 3a, Outline Pages 3-4. The outline is attached as Exhibit 3a to the 19b-4 form. \15\ See Exhibit 3a, Outline Pages 5-6. \16\ See Exhibit 3a, Outline Pages 7-8. \17\ See Exhibit 3a, Outline Page 9. \18\ See Exhibit 3a, Outline Page 3. --------------------------------------------------------------------------- FINRA also is proposing to revise the content outline to reflect changes to the laws, rules and regulations covered by the examination. Among other revisions, FINRA is proposing to revise the content outline to reflect the adoption of new FINRA rules (e.g., FINRA Rule 2273 (Educational Communication Related to Recruitment Practices and Account Transfers)). FINRA is proposing similar changes to the Series 82 selection specifications and question bank. Finally, FINRA is proposing to make other changes to the format of the content outline, including to the preface, sample questions and reference materials.\19\ Among other changes, FINRA is proposing to: (1) Reduce the preface to one page of introductory information; (2) streamline details regarding the purpose of the examination; (3) move the application procedures to FINRA's website; and (4) explain that the passing score is established using a standard setting procedure, and that a statistical adjustment process known as equating is used in scoring the examination.\20\ --------------------------------------------------------------------------- \19\ FINRA is proposing similar changes to the content outlines for other representative-level examinations. \20\ See Exhibit 3a, Outline Page 2. --------------------------------------------------------------------------- As a result of the proposed changes, the number of scored questions on the Series 82 examination will be reduced from 100 questions to 50 questions.\21\ Further, the test time, which is the amount of time candidates will have to complete the examination, will be reduced from two hours and 30 minutes to one hour and 30 minutes. Currently, a score of 70 percent is required to pass the examination. FINRA will publish the passing score of the revised Series 82 examination on its website, at www.finra.org, prior to its first administration. --------------------------------------------------------------------------- \21\ Consistent with FINRA's practice of including ``pretest'' questions on examinations, the Series 82 examination includes five additional, unidentified pretest questions that do not contribute towards the candidate's score. The pretest questions are designed to ensure that new examination questions meet acceptable testing standards prior to use for scoring purposes. Therefore, the Series 82 examination actually consists of 55 questions, 50 of which are scored. The five pretest questions are randomly distributed throughout the examination. --------------------------------------------------------------------------- Availability of Content Outline The current Series 82 content outline is available on FINRA's website. The revised Series 82 content outline will replace the current content outline on FINRA's website, and it will be made available on the website on the date of this filing. FINRA is filing the proposed rule change for immediate effectiveness. The implementation date will be October 1, 2018, to coincide with the implementation of the restructured representative- level examination program. FINRA will also announce the implementation date of the proposed rule change in a Regulatory Notice. 2. Statutory Basis FINRA believes that the proposed revisions to the Series 82 examination program are consistent with the provisions of Section 15A(b)(6) of the Act,\22\ 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,\23\ which authorizes FINRA to prescribe standards of training, experience, and competence for persons associated with FINRA members. The proposed rule change will improve the examination program, without compromising the qualification standards, by removing the general [[Page 9053]] knowledge content currently covered on the Series 82 examination, since that content will be covered in the co-requisite SIE examination. In addition, the proposed revisions will further the purposes of the Act by updating the examination program to reflect changes to the laws, rules and regulations covered by the examination and to incorporate the functions and associated tasks currently performed by a Private Securities Offerings Representative. --------------------------------------------------------------------------- \22\ 15 U.S.C. 78o-3(b)(6). \23\ 15 U.S.C. 78o-3(g)(3). --------------------------------------------------------------------------- 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. The updated examination aligns with the functions and associated tasks currently performed by a Private Securities Offerings Representative and tests knowledge of the most current laws, rules, regulations and skills relevant to those functions and associated tasks. As such, the proposed revisions would make the examination more effective. FINRA also provided a detailed economic impact assessment regarding the introduction of the SIE examination and the restructuring of the representative-level examinations as part of the proposed rule change to restructure the FINRA representative-level qualification examination program.\24\ --------------------------------------------------------------------------- \24\ See Securities Exchange Act Release No. 80371 (April 4, 2017), 82 FR 17336 (April 10, 2017) (Notice of Filing of File No. SR-FINRA-2017-007). --------------------------------------------------------------------------- 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. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act \25\ and paragraph (f)(1) of Rule 19b-4 thereunder.\26\ At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved. --------------------------------------------------------------------------- \25\ 15 U.S.C. 78s(b)(3)(A). \26\ 17 CFR 240.19b-4(f)(1). --------------------------------------------------------------------------- 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-2018-011 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-2018-011. 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 website (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 website 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 a.m. and 3 p.m. Copies of such filing also will be available for inspection and copying at the principal office of FINRA. All comments received will be posted without change. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR- FINRA-2018-011 and should be submitted on or before March 23, 2018. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\27\ --------------------------------------------------------------------------- \27\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018-04210 Filed 3-1-18; 8:45 am] BILLING CODE 8011-01-P
![9050 Federal Register / Vol. 83, No. 42 / Friday, March 2, 2018 / Notices
circumstances specified in the sell shares to Funds of Funds beyond appropriate in the public interest and
application, purchasers will be required the limits of section 12(d)(1)(B) of the consistent with the protection of
to purchase Creation Units by Act. The application’s terms and investors and the purposes fairly
depositing specified instruments conditions are designed to, among other intended by the policy and provisions of
(‘‘Deposit Instruments’’), and things, help prevent any potential (i) the Act. Section 12(d)(1)(J) of the Act
shareholders redeeming their shares undue influence over a Fund through provides that the Commission may
will receive specified instruments control or voting power, or in exempt any person, security, or
(‘‘Redemption Instruments’’). The connection with certain services, transaction, or any class or classes of
Deposit Instruments and the transactions, and underwritings, (ii) persons, securities, or transactions, from
Redemption Instruments will each excessive layering of fees, and (iii) any provision of section 12(d)(1) if the
correspond pro rata to the positions in overly complex fund structures, which exemption is consistent with the public
the Fund’s portfolio (including cash are the concerns underlying the limits interest and the protection of investors.
positions) except as specified in the in sections 12(d)(1)(A) and (B) of the Section 17(b) of the Act authorizes the
application. Act. Commission to grant an order
4. Because shares will not be 8. Applicants request an exemption permitting a transaction otherwise
individually redeemable, applicants from sections 17(a)(1) and 17(a)(2) of the prohibited by section 17(a) if it finds
request an exemption from section Act to permit persons that are affiliated that (a) the terms of the proposed
5(a)(1) and section 2(a)(32) of the Act persons, or second-tier affiliates, of the transaction are fair and reasonable and
that would permit the Funds to register Funds, solely by virtue of certain do not involve overreaching on the part
as open-end management investment ownership interests, to effectuate of any person concerned; (b) the
companies and issue shares that are purchases and redemptions in-kind. The proposed transaction is consistent with
redeemable in Creation Units only. deposit procedures for in-kind the policies of each registered
5. Applicants also request an purchases of Creation Units and the investment company involved; and (c)
exemption from section 22(d) of the Act redemption procedures for in-kind the proposed transaction is consistent
and rule 22c–1 under the Act as redemptions of Creation Units will be with the general purposes of the Act.
secondary market trading in shares will the same for all purchases and For the Commission, by the Division of
take place at negotiated prices, not at a redemptions and Deposit Instruments Investment Management, under delegated
current offering price described in a and Redemption Instruments will be authority.
Fund’s prospectus, and not at a price valued in the same manner as those Eduardo A. Aleman,
based on NAV. Applicants state that (a) Portfolio Instruments currently held by Assistant Secretary.
secondary market trading in shares does the Funds. Applicants also seek relief [FR Doc. 2018–04199 Filed 3–1–18; 8:45 am]
not involve a Fund as a party and will from the prohibitions on affiliated
BILLING CODE 8011–01–P
not result in dilution of an investment transactions in section 17(a) to permit a
in shares, and (b) to the extent different Fund to sell its shares to and redeem its
prices exist during a given trading day, shares from a Fund of Funds, and to SECURITIES AND EXCHANGE
or from day to day, such variances occur engage in the accompanying in-kind COMMISSION
as a result of third-party market forces, transactions with the Fund of Funds.2
such as supply and demand. Therefore, The purchase of Creation Units by a [Release No. 34–82774; File No. SR–FINRA–
applicants assert that secondary market Fund of Funds directly from a Fund will 2018–011]
transactions in shares will not lead to be accomplished in accordance with the
discrimination or preferential treatment Self-Regulatory Organizations;
policies of the Fund of Funds and will
among purchasers. Finally, applicants Financial Industry Regulatory
be based on the NAVs of the Funds.
represent that share market prices will 9. Applicants also request relief to Authority, Inc.; Notice of Filing and
be disciplined by arbitrage permit a Feeder Fund to acquire shares Immediate Effectiveness of a Proposed
opportunities, which should prevent of another registered investment Rule Change To Revise the Private
shares from trading at a material company managed by the Adviser Securities Offerings Representative
discount or premium from NAV. having substantially the same (Series 82) Examination
6. With respect to Funds that hold investment objectives as the Feeder February 26, 2018.
non-U.S. Portfolio Instruments and that Fund (‘‘Master Fund’’) beyond the Pursuant to Section 19(b)(1) of the
effect creations and redemptions of limitations in section 12(d)(1)(A) and Securities Exchange Act of 1934
Creation Units in kind, applicants permit the Master Fund, and any (‘‘Act’’) 1 and Rule 19b–4 thereunder,2
request relief from the requirement principal underwriter for the Master notice is hereby given that on February
imposed by section 22(e) in order to Fund, to sell shares of the Master Fund 12, 2018, Financial Industry Regulatory
allow such Funds to pay redemption to the Feeder Fund beyond the Authority, Inc. (‘‘FINRA’’) filed with the
proceeds within fifteen calendar days limitations in section 12(d)(1)(B). Securities and Exchange Commission
following the tender of Creation Units 10. Section 6(c) of the Act permits the (‘‘SEC’’ or ‘‘Commission’’) the proposed
for redemption. Applicants assert that Commission to exempt any persons or rule change as described in Items I, II,
the requested relief would not be transactions from any provision of the and III below, which Items have been
inconsistent with the spirit and intent of Act if such exemption is necessary or prepared by FINRA. FINRA has
section 22(e) to prevent unreasonable, designated the proposed rule change as
undisclosed or unforeseen delays in the 2 The requested relief would apply to direct sales
‘‘constituting a stated policy, practice,
actual payment of redemption proceeds. of shares in Creation Units by a Fund to a Fund of
or interpretation with respect to the
daltland on DSKBBV9HB2PROD with NOTICES
Funds and redemptions of those shares. Applicants,
7. Applicants request an exemption to moreover, are not seeking relief from section 17(a) meaning, administration, or
permit Funds of Funds to acquire Fund for, and the requested relief will not apply to, enforcement of an existing rule’’ under
shares beyond the limits of section transactions where a Fund could be deemed an Section 19(b)(3)(A)(i) of the Act 3 and
12(d)(1)(A) of the Act; and the Funds, Affiliated Person, or a Second-Tier Affiliate, of a
Fund of Funds because an Adviser or an entity
and any principal underwriter for the controlling, controlled by or under common control
1 15 U.S.C. 78s(b)(1).
Funds, and/or any broker or dealer with an Adviser provides investment advisory 2 17 CFR 240.19b–4.
registered under the Exchange Act, to services to that Fund of Funds. 3 15 U.S.C. 78s(b)(3)(A)(i).
VerDate Sep<11>2014 18:10 Mar 01, 2018 Jkt 244001 PO 00000 Frm 00088 Fmt 4703 Sfmt 4703 E:\FR\FM\02MRN1.SGM 02MRN1](https://thefederalregister.org/doc/83_FR_9092/page/1.svg)
![Federal Register / Vol. 83, No. 42 / Friday, March 2, 2018 / Notices 9051
Rule 19b–4(f)(1) thereunder,4 which in Item IV below. FINRA has prepared revised representative-level
renders the proposal effective upon summaries, set forth in sections A, B, qualification examinations will test
receipt of this filing by the Commission. and C below, of the most significant knowledge relevant to day-to-day
The Commission is publishing this aspects of such statements. activities, responsibilities and job
notice to solicit comments on the functions of representatives.12
A. Self-Regulatory Organization’s As part of the restructuring process
proposed rule change from interested
Statement of the Purpose of, and and in consultation with a committee of
persons.
Statutory Basis for, the Proposed Rule industry representatives, FINRA
I. Self-Regulatory Organization’s Change undertook a review of the Private
Statement of the Terms of Substance of Securities Offerings Representative
1. Purpose
the Proposed Rule Change (Series 82) examination to remove the
Section 15A(g)(3) of the Act 8 general securities knowledge currently
FINRA is proposing revisions to the
authorizes FINRA to prescribe standards covered on the examination and to
content outline and selection
of training, experience, and competence create a tailored examination to test
specifications for the Private Securities
for persons associated with FINRA knowledge relevant to the day-to-day
Offerings Representative (Series 82)
members. In accordance with that activities, responsibilities and job
examination as part of the restructuring
provision, FINRA has developed functions of a Private Securities
of the representative-level examination
examinations that are designed to Offerings Representative. As a result of
program.5 The proposed revisions also
establish that persons associated with this review, FINRA also is proposing to
update the material to reflect changes to
FINRA members have attained specified revise the Series 82 content outline to
the laws, rules and regulations covered
levels of competence and knowledge, reflect changes to the laws, rules and
by the examination and to incorporate
consistent with applicable registration regulations covered by the examination
the functions and associated tasks
requirements under FINRA rules. and to incorporate the functions and
currently performed by a Private
FINRA periodically reviews the content associated tasks currently performed by
Securities Offerings Representative. In
of the examinations to determine a Private Securities Offerings
addition, FINRA is proposing to make
whether revisions are necessary or Representative. The proposed change
changes to the format of the content
appropriate in view of changes will align the organization of the Series
outline. FINRA is not proposing any
pertaining to the subject matter covered 82 content outline with the organization
textual changes to the By-Laws,
by the examinations. of the content outlines of the other
Schedules to the By-Laws or Rules of
The SEC recently approved a revised representative-level
FINRA.
proposed rule change to restructure the examinations.13 In addition, FINRA is
The revised Series 82 content outline
FINRA representative-level qualification proposing to make other changes to the
is attached.6 The revised Series 82
examination program.9 The rule change, format of the Series 82 content outline.
selection specifications have been
which will become effective on October Beginning on October 1, 2018, new
submitted to the Commission under
1, 2018,10 restructures the examination applicants seeking to register as Private
separate cover with a request for
program into a new format whereby all Securities Offerings Representatives
confidential treatment pursuant to SEA
new representative-level applicants will must pass the SIE examination and the
Rule 24b–2.7
be required to take a general knowledge revised Private Securities Offerings
The text of the proposed rule change
examination (the Securities Industry Representative (Series 82) examination.
is available on FINRA’s website at
Essentials or SIETM) and a tailored,
http://www.finra.org, at the principal Current Content Outline
specialized knowledge examination (a
office of FINRA and at the The current Series 82 content outline
revised representative-level
Commission’s Public Reference Room. is divided into four sections. The
qualification examination) for their
[sic] following are the four sections, denoted
particular registered role.
II. Self-Regulatory Organization’s The restructured program eliminates Section 1 through Section 4, with the
Statement of the Purpose of, and duplicative testing of general securities associated number of questions:
Statutory Basis for, the Proposed Rule knowledge on the current 1. Characteristics of Corporate
Change representative-level qualification Securities, 13 questions;
examinations by moving such content 2. Regulation of The Market for
In its filing with the Commission, Registered and Unregistered Securities,
FINRA included statements concerning into the SIE examination.11 The SIE
examination will test fundamental 45 questions;
the purpose of and basis for the 3. Analyzing Corporate Securities and
proposed rule change and discussed any securities-related knowledge, including
knowledge of basic products, the Investment Planning, 16 questions; and
comments it received on the proposed
rule change. The text of these statements structure and function of the securities 12 FINRA filed the SIE content outline with the
may be examined at the places specified industry, the regulatory agencies and SEC for immediate effectiveness. See Securities
their functions and regulated and Exchange Act Release No. 82578 (January 24, 2018),
4 17 prohibited practices, whereas the 83 FR 4375 (January 30, 2018) (Notice of Filing and
CFR 240.19b–4(f)(1). Immediate Effectiveness of File No. SR–FINRA–
5 FINRA also is proposing corresponding
8 15
2018–002). In addition to the proposed rule change
revisions to the Series 82 question bank. Based on U.S.C. 78o–3(g)(3). relating to the revised Series 82 examination,
instruction from SEC staff, FINRA is submitting this 9 See Securities Exchange Act Release No. 81098 FINRA is filing with the Commission for immediate
filing for immediate effectiveness pursuant to (July 7, 2017), 82 FR 32419 (July 13, 2017) (Order effectiveness the content outlines for the other
Section 19(b)(3)(A) of the Act and Rule 19b–4(f)(1) Approving File No. SR–FINRA–2017–007). revised representative-level qualification
daltland on DSKBBV9HB2PROD with NOTICES
thereunder, and is not filing the question bank. See 10 See Regulatory Notice 17–30 (SEC Approves
examinations.
Letter to Alden S. Adkins, Senior Vice President Consolidated FINRA Registration Rules, 13 FINRA currently has organized several FINRA
and General Counsel, NASD Regulation, from Restructured Representative-Level Qualification qualification examinations, such as the Securities
Belinda Blaine, Associate Director, Division of Examinations and Changes to Continuing Education Trader (Series 57) examination, based on the
Market Regulation, SEC, dated July 24, 2000. The Requirements) (October 2017). functions that are performed by the respective
question bank is available for SEC review. 11 Each of the current representative-level registered persons and the associated tasks. FINRA
6 The Commission notes that the content outline
examinations covers general securities knowledge, is proposing similar layouts for all of the
is attached to the filing, not to this Notice. with the exception of the Research Analyst (Series representative-level examinations, including the
7 17 CFR 240.24b–2. 86 and 87) examinations. Series 82 examination.
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![Federal Register / Vol. 83, No. 42 / Friday, March 2, 2018 / Notices 9053
knowledge content currently covered on to determine whether the proposed rule For the Commission, by the Division of
the Series 82 examination, since that should be approved or disapproved. Trading and Markets, pursuant to delegated
content will be covered in the co- authority.27
requisite SIE examination. In addition, IV. Solicitation of Comments Eduardo A. Aleman,
the proposed revisions will further the Assistant Secretary.
Interested persons are invited to
purposes of the Act by updating the submit written data, views and [FR Doc. 2018–04210 Filed 3–1–18; 8:45 am]
examination program to reflect changes arguments concerning the foregoing, BILLING CODE 8011–01–P
to the laws, rules and regulations including whether the proposed rule
covered by the examination and to change is consistent with the Act.
incorporate the functions and associated SECURITIES AND EXCHANGE
Comments may be submitted by any of COMMISSION
tasks currently performed by a Private
the following methods:
Securities Offerings Representative.
Proposed Collection; Comment
B. Self-Regulatory Organization’s Electronic Comments
Request
Statement on Burden on Competition • Use the Commission’s internet Upon Written Request, Copies Available
FINRA does not believe that the comment form (http://www.sec.gov/ From: Securities and Exchange
proposed rule change will result in any rules/sro.shtml); or Commission, Office of FOIA Services,
burden on competition that is not • Send an email to rule-comments@ 100 F Street NE, Washington, DC
necessary or appropriate in furtherance sec.gov. Please include File Number SR– 20549–2736
of the purposes of the Act. The updated FINRA–2018–011 on the subject line. Extension:
examination aligns with the functions Rule 17Ac2–1, SEC File No. 270–095, OMB
and associated tasks currently Paper Comments Control No. 3235–0084
performed by a Private Securities
Offerings Representative and tests • Send paper comments in triplicate Notice is hereby given that pursuant
knowledge of the most current laws, to Secretary, Securities and Exchange to the Paperwork Reduction Act of 1995
rules, regulations and skills relevant to Commission, 100 F Street NE, (‘‘PRA’’) (44 U.S.C. 3501 et seq.), the
those functions and associated tasks. As Washington, DC 20549–1090. Securities and Exchange Commission
such, the proposed revisions would (‘‘Commission’’) is soliciting comments
All submissions should refer to File on the existing collection of information
make the examination more effective. Number SR–FINRA–2018–011. This file
FINRA also provided a detailed provided for in Rule 17Ac2–1 (17 CFR
number should be included on the 240.17Ac2–1), under the Securities
economic impact assessment regarding subject line if email is used. To help the
the introduction of the SIE examination Exchange Act of 1934 (15 U.S.C. 78a et
Commission process and review your seq.). The Commission plans to submit
and the restructuring of the comments more efficiently, please use
representative-level examinations as this existing collection of information to
only one method. The Commission will the Office of Management and Budget
part of the proposed rule change to
post all comments on the Commission’s (‘‘OMB’’) for extension and approval.
restructure the FINRA representative-
internet website (http://www.sec.gov/ Rule 17Ac2–1, pursuant to Section
level qualification examination
rules/sro.shtml). Copies of the 17A(c) of the Exchange Act, generally
program.24
submission, all subsequent requires transfer agents for whom the
C. Self-Regulatory Organization’s amendments, all written statements Commission is the transfer agent’s
Statement on Comments on the with respect to the proposed rule Appropriate Regulatory Agency
Proposed Rule Change Received From change that are filed with the (‘‘ARA’’), to file an application for
Members, Participants, or Others Commission, and all written registration with the Commission on
Written comments were neither communications relating to the Form TA–1 and to amend their
solicited nor received. proposed rule change between the registrations under certain
Commission and any person, other than circumstances.
III. Date of Effectiveness of the those that may be withheld from the Specifically, Rule 17Ac2–1 requires
Proposed Rule Change and Timing for public in accordance with the transfer agents to file a Form TA–1
Commission Action provisions of 5 U.S.C. 552, will be application for registration with the
The foregoing rule change has become available for website viewing and Commission where the Commission is
effective pursuant to Section 19(b)(3)(A) printing in the Commission’s Public their ARA. Such transfer agents must
of the Act 25 and paragraph (f)(1) of Rule Reference Room, 100 F Street NE, also amend their Form TA–1 if the
19b–4 thereunder.26 At any time within Washington, DC 20549, on official existing information on their Form
60 days of the filing of the proposed rule business days between the hours of 10 TA–1 becomes inaccurate, misleading,
change, the Commission summarily may a.m. and 3 p.m. Copies of such filing or incomplete within 60 days following
temporarily suspend such rule change if also will be available for inspection and the date the information became
it appears to the Commission that such copying at the principal office of inaccurate, misleading or incomplete.
action is necessary or appropriate in the Registration filings on Form TA–1 and
FINRA. All comments received will be
public interest, for the protection of amendments thereto must be filed with
posted without change. Persons
investors, or otherwise in furtherance of the Commission electronically, absent
submitting comments are cautioned that
the purposes of the Act. If the an exemption, on EDGAR pursuant to
we do not redact or edit personal
Regulation S–T (17 CFR 232).
daltland on DSKBBV9HB2PROD with NOTICES
Commission takes such action, the identifying information from comment The Commission annually receives
Commission shall institute proceedings submissions. You should submit only approximately 186 filings on Form
information that you wish to make TA–1 from transfer agents required to
24 See Securities Exchange Act Release No. 80371
available publicly. All submissions register as such with the Commission.
(April 4, 2017), 82 FR 17336 (April 10, 2017)
(Notice of Filing of File No. SR–FINRA–2017–007).
should refer to File Number SR–FINRA– Included in this figure are
25 15 U.S.C. 78s(b)(3)(A). 2018–011 and should be submitted on
26 17 CFR 240.19b–4(f)(1). or before March 23, 2018. 27 17 CFR 200.30–3(a)(12).
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Document Created: 2018-03-01 23:57:11
Document Modified: 2018-03-01 23:57:11
| 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 | |
| FR Citation | 83 FR 9050 |
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