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 June 25, 2025, the 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 “establishing or changing a due, fee or other charge” under Section 19(b)(3)(A)(ii) of the Act ^[3] and Rule 19b-4(f)(2) 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.

I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change

FINRA is proposing to amend FINRA Rule 6897(b) (CAT Cost Recovery Fees) to implement a Consolidated Audit Trail (“CAT”) cost recovery fee designed to permit FINRA to recoup its designated portion of the reasonably budgeted CAT costs of the National Market System Plan Governing the Consolidated Audit Trail (the “CAT NMS Plan” or “Plan”) for the period July 1, 2025 through December 31, 2025.^[5]

The text of the proposed rule change is available on FINRA's website at https://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

On July 11, 2012, the Commission adopted Rule 613 of Regulation NMS, which required the self-regulatory organizations to submit a national market system (“NMS”) plan to create, implement and maintain a consolidated audit trail that would capture customer and order event information for orders in NMS securities across all markets, from the time of order inception through routing, cancellation, modification, or execution.^[6] On November 15, 2016, the Commission approved the CAT NMS Plan.^[7] Under the CAT NMS Plan, the Operating Committee has the discretion to establish funding for Consolidated Audit Trail, LLC (“CAT LLC”) to operate the CAT, including establishing fees for Industry Members to be assessed by CAT LLC that would be implemented on behalf of CAT LLC by the Participants.^[8] The Operating Committee adopted a revised funding model to fund the CAT (“CAT Funding Model”) and, on September 6, 2023, the Commission approved the CAT Funding Model after concluding that the model was reasonable and that it satisfied the requirements of Section 11A of the Exchange Act and Rule 608 thereunder.^[9]

The CAT Funding Model provides a framework for the recovery of the costs to create, develop, and maintain the CAT, including providing a method for allocating costs to fund the CAT among Participants and Industry Members. The CAT Funding Model establishes two categories of fees: (1) CAT fees assessed by CAT LLC and payable by certain Industry Members to recover a portion of historical CAT costs previously paid by the Participants; ^[10] and (2) CAT fees assessed by CAT LLC and payable by Participants and Industry Members to fund Prospective CAT Costs, i.e., costs not previously paid by the Participants.^[11]

With respect to CAT fees implemented to fund Prospective CAT Costs, the CAT Operating Committee has established CAT Fee 2025-2 to implement fees payable by Industry Members to recover the reasonably budgeted Prospective CAT Costs for the period July 1, 2025 through December 31, 2025 (“Budgeted CAT Costs 2025-2”).^[12] Consistent with the Plan, the Operating Committee has also established fees payable to CAT LLC by the Participants to collect the Participants' designated portion of Budgeted CAT Costs 2025-2. ^[13] Participants would only be required to pay such fees once CAT Fee 2025-2 is in effect with regard to Industry Members in accordance with Section 19(b) of the Exchange Act.^[14]

In light of the filing of File No. SR-FINRA-2025-009, which implements CAT Fee 2025-2 with regard to Industry Members, FINRA is filing the instant proposed rule change to establish a fee ( printed page 30172) that would allow FINRA to recover the monthly fees it is required to pay to CAT LLC towards Budgeted CAT Costs 2025-2 (“Prospective CAT Cost Recovery Fee 2025-2”).^[15] In the Approval Order, the Commission acknowledged that “the Exchange Act expressly contemplates the ability of the Participants to recoup their costs to fulfill their statutory obligations under the Exchange Act.” ^[16] The Commission also noted FINRA's statement “that it would file a rule change to increase its member fees with the filing of any proposed rule change to effectuate the Funding Model.” ^[17]

FINRA's Designated Portion of Budgeted CAT Costs 2025-2

As discussed in File No. SR-FINRA-2025-009, the Operating Committee has established CAT Fee 2025-2, payable to CAT LLC by Industry Members, to recover two-thirds of the $60,726,412 in Budgeted CAT Costs 2025-2 over the July 1, 2025 through December 31, 2025 period, or $40,484,274.66.^[18]

The Operating Committee further determined that the fee rate for CAT Fee 2025-2 is $0.00002651641828376661 per executed equivalent share,^[19] and, under the CAT Funding Model, each of the CAT Executing Broker for the Buyer (“CEBB”), the CAT Executing Broker for the Seller (“CEBS”), and the relevant Participant for a given transaction in an Eligible Security would be responsible for one-third of that rate, or $0.000009 per executed equivalent share.^[20] Consequently, CEBBs collectively, CEBSs collectively, and the Participants collectively will each be responsible for $20,242,137.33, which is one-third of Budgeted CAT Costs 2025-2 during the July 1, 2025 through December 31, 2025 period.^[21] As provided for in File No. SR-FINRA-2025-009, CAT Fee 2025-2 has been established to recoup Budgeted CAT Costs 2025-2 based on an updated 2025 CAT Budget which includes actual costs for each category for the months of January through March 2025, and estimated costs for the remainder of 2025.^[22]

For the twelve months from April 1, 2024, through March 31, 2025, the average monthly executed equivalent share volume in Eligible Securities where FINRA was the relevant Participant ( i.e., off-exchange transactions) was approximately 135 billion shares. Assuming similar monthly executed equivalent share volume for off-exchange transactions in Eligible Securities from July 1, 2025 through December 31, 2025, for this period, FINRA would be responsible for paying approximately $1,211,400 per month and approximately $7,268,400 in total to CAT LLC toward the Participants' $20,242,137 designated portion of Budgeted CAT Costs 2025-2 (or approximately 36% of the Participants' designated portion of Budgeted CAT Costs 2025-2 from July 1, 2025 through December 31, 2025).

FINRA's recovery of its designated portion of Budgeted CAT Costs 2025-2 is reasonable and consistent with the Exchange Act. As discussed herein and in File No. SR-FINRA-2025-009, Budgeted CAT Costs 2025-2 are reasonable, appropriate and necessary for the creation, implementation, and maintenance of the CAT. In addition, the portion of Budgeted CAT Costs 2025-2 designated to FINRA has been established under the SEC-approved CAT Funding Model.^[23] As stated by FINRA and permitted under the Exchange Act, FINRA will seek to recover its designated portion of the Participants' share of CAT costs to ensure that FINRA can fulfill its regulatory mandate and responsibilities.^[24]

Prospective CAT Cost Recovery Fee 2025-2

FINRA is proposing to amend Rule 6897(b) (CAT Cost Recovery Fees) to implement Prospective CAT Cost Recovery Fee 2025-2 to allow FINRA to recover its designated portion of Budgeted CAT Costs 2025-2.^[25] FINRA intends that the fee framework for the Prospective CAT Cost Recovery Fee 2025-2 would generally correspond to the framework put in place by CAT LLC with respect to CAT Fee 2025-2, as provided for in File No. SR-FINRA-2025-009. FINRA also intends that the timing and commencement of payment for Prospective CAT Cost Recovery Fee 2025-2 would correspond with that established by CAT LLC with respect to CAT Fee 2025-2, as provided for in File No. SR-FINRA-2025-009. Thus, as with CAT Fee 2025-2, FINRA proposes that each member CAT Executing Broker shall receive its first invoice for Prospective CAT Cost Recovery Fee 2025-2 in August 2025, setting forth fees calculated based on July 2025 transactions in Eligible Securities ( printed page 30173) executed otherwise than on an exchange, as reflected in CAT Data.

The following fields of the Participant Technical Specifications indicate the CAT Executing Brokers for transactions executed otherwise than on an exchange.^[26]

As discussed in File No. SR-FINRA-2025-009, consistent with the CAT Funding Model, in implementing CAT Fee 2025-2, the Operating Committee has determined that each of the CEBB, CEBS and relevant Participant for a given transaction in an Eligible Security would be assessed a fee of $0.000009 per executed equivalent share. In line with this approach, FINRA proposes that the amount assessed on CEBBs and CEBSs under Prospective CAT Cost Recovery Fee 2025-2 would generally take the approach of equally apportioning the fee rate that is assessed to FINRA under CAT Fee 2025-2 between each of the CEBB and CEBS for transactions where FINRA is the relevant Participant. To maintain consistency with CAT LLC's use of six decimal places, FINRA's Prospective CAT Cost Recovery Fee is also limited to six decimal places. Because CAT Fee 2025-2 ends in an odd number— i.e., $0.000009, halving the rate would have resulted in a Prospective CAT Cost Recovery Fee rate of $0.0000045, which is seven decimal places. To achieve a Prospective CAT Cost Recovery Fee rate of no more than six decimal places, FINRA is rounding up the CAT Fee 2025-2 rate of $0.000009 to $0.000010 and dividing it by two, resulting in a Prospective CAT Cost Recovery Fee 2025-2 of $0.000005. Therefore, pursuant to this approach, each member CEBB and CEBS would pay a Prospective CAT Cost Recovery Fee of $0.000005 per executed equivalent share for each transaction in Eligible Securities executed otherwise than on an exchange and FINRA would fully recover the amount assessed on FINRA under CAT Fee 2025-2.^[28] Based on historical executed equivalent share volumes in Eligible Securities where FINRA was the relevant Participant, FINRA would expect to recoup approximately $1,346,000 per month during the time that Prospective CAT Cost Recovery Fee 2025-2 is in effect. FINRA anticipates that this approach will result in an overcollection of approximately $807,600 during the July 1, 2025 through December 31, 2025 period.^[29]

FINRA proposes to adopt Rule 6897(b)(1)(E) (Prospective CAT Cost Recovery Fee 2025-2) to implement Prospective CAT Cost Recovery Fee 2025-2. Proposed Rule 6897(b)(1)(E)(i) would provide that each member CAT Executing Broker shall receive its first invoice from FINRA in August 2025, setting forth the Prospective CAT Cost Recovery Fee 2025-2 fees calculated based on transactions in July 2025, and shall receive an invoice for Prospective CAT Cost Recovery Fee 2025-2 from FINRA for each month thereafter until January 2026. As provided in proposed Rule 6897(b)(1)(E)(ii), FINRA shall provide each member CAT Executing Broker with an invoice for Prospective CAT Cost Recovery Fee 2025-2 on a monthly basis (which shall be separate from the invoice provide by CAT LLC with respect to CAT Fee 2025-2). Each monthly invoice provided by FINRA shall set forth a fee for each transaction in Eligible Securities executed by the CAT Executing Broker in its capacity as the CEBB and/or the CEBS (as applicable) otherwise than on an exchange from the prior month as set forth in CAT Data. The fee assessed to each CEBB and CEBS for each such transaction will be calculated by multiplying the number of executed equivalent shares in the transaction by the Prospective CAT Cost Recovery Fee 2025-2 fee rate of $0.000005 per executed equivalent share. ( printed page 30174)

Further, as provided in proposed Rule 6897(b)(1)(E)(iii), notwithstanding the last invoice date of January 2026 for Prospective CAT Cost Recovery Fee 2025-2 in Rule 6897(b)(1)(E)(i), Prospective CAT Cost Recovery Fee 2025-2 shall continue in effect after January 2026, with each CAT Executing Broker receiving an invoice for Prospective CAT Cost Recovery Fee 2025-2 each month, until a new subsequent Prospective CAT Cost Recovery Fee is in effect with regard to members in accordance with Section 19(b) of the Exchange Act.^[30] Proposed paragraph (b)(1)(E)(iii) of Rule 6897 also states that FINRA will provide notice when Prospective CAT Cost Recovery Fee 2025-2 will no longer be in effect. Proposed Rule 6897(b)(1)(E)(iv) provides that each member CAT Executing Broker shall be required to pay each invoice for Prospective CAT Cost Recovery Fee 2025-2 as set forth in Rule 6897(b)(2).

Beginning with the initial invoice for Prospective CAT Cost Recovery Fee 2025-2 in August 2025, FINRA will make available to each member CAT Executing Broker a copy of the relevant details for fee liable transactions executed each month otherwise than on an exchange. Similar to the information that would be provided by CAT LLC to CAT Executing Brokers in assessing the off-exchange portion of CAT Fee 2025-2 each month,^[31] such information would provide member CAT Executing Brokers with the ability to understand the details regarding the calculation of their Prospective CAT Cost Recovery Fee 2025-2 fees. In addition, to provide transparency to the industry, FINRA will make publicly available on its website: (i) the total amount invoiced each month that Prospective CAT Cost Recovery Fee 2025-2 is in effect, (ii) the total amount invoiced for Prospective CAT Cost Recovery Fee 2025-2 for all months since its commencement, (iii) the total amount that FINRA is invoiced each month by CAT LLC in connection with CAT Fee 2025-2, (iv) the total amount that FINRA has been invoiced for CAT Fee 2025-2 for all months since its commencement, and (v) the variance, both on a monthly and cumulative basis, between the amount invoiced by FINRA under Prospective CAT Cost Recovery 2025-2 and the amount FINRA is invoiced under CAT Fee 2025-2.

FINRA has filed the proposed rule change for immediate effectiveness. The effective date and the implementation date will be the date of filing.

2. Statutory Basis

FINRA believes that the proposed rule change is consistent with the provisions of Section 15A(b)(6) of the Act,^[32] 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 must not be designed to permit unfair discrimination between customers, issuers, brokers or dealers. FINRA also believes that the proposed rule change is consistent with the provisions of Section 15A(b)(5) of the Act,^[33] which requires, among other things, that FINRA rules provide for the equitable allocation of reasonable dues, fees and other charges among members and issuers and other persons using any facility or system that FINRA operates or controls. FINRA further believes that the proposed rule change is consistent with the provisions of Section 15A(b)(9) of the Act,^[34] which requires that FINRA rules not impose any burden on competition that is not necessary or appropriate in furtherance of the purpose of the Exchange Act. Section 15A(b)(2) of the Act also requires that FINRA be “so organized and [have] the capacity to be able to carry out the purposes” of the Act and “to comply, and . . . to enforce compliance by its members, and persons associated with its members,” with the provisions of the Exchange Act.^[35]

FINRA believes that this proposed rule change is consistent with the Act because it is designed to assist FINRA in meeting regulatory obligations pursuant to the Plan. In approving the Plan, the SEC noted that the Plan “is necessary and appropriate in the public interest, for the protection of investors and the maintenance of fair and orderly markets, to remove impediments to, and perfect the mechanism of a national market system, or is otherwise in furtherance of the purposes of the Act.” ^[36] To the extent that this proposed rule change implements a requirement that facilitates FINRA's achievement of its regulatory obligations under the Plan and applies specific requirements to FINRA members in this regard, FINRA believes that this proposed rule change furthers the objectives of the Plan, as identified by the SEC, and is therefore consistent with the Act.

As discussed in detail in File No. SR-FINRA-2025-009, FINRA believes that the proposed fees paid by the CEBBs and CEBSs in connection with CAT Fee 2025-2 are reasonable, equitably allocated and not unfairly discriminatory. Prospective CAT Cost Recovery Fee 2025-2 would similarly allow FINRA to recover costs related to CAT Fee 2025-2 from member CAT Executing Brokers in a fair and reasonable manner, as contemplated by the Exchange Act and consistent with the CAT Funding Model Approval Order.

Proposed Prospective CAT Cost Recovery Fee 2025-2 would be charged to member CAT Executing Brokers in support of the maintenance of a consolidated audit trail for regulatory purposes. The proposed fees, therefore, are consistent with the Commission's view that regulatory fees be used for regulatory purposes. The proposed fees would not cover FINRA costs unrelated to the CAT. Accordingly, FINRA believes that the proposed fees are reasonable, equitable and not unfairly discriminatory.

The reasonableness of Prospective CAT Cost Recovery Fee 2025-2 and its consistency with the Exchange Act likewise is grounded in the facts described above and detailed in File No. SR-FINRA-2025-009. Specifically, the reasonably budgeted expenses that compose the portion of Budgeted CAT Costs 2025-2 sought to be recovered through Prospective CAT Cost Recovery Fee 2025-2 were recognized by the SEC as appropriate for recovery pursuant to the formula approved in the CAT Funding Model ( i.e., technology, legal, consulting, insurance, professional administration, and public relations costs). FINRA has determined that these costs, which are described in detail in File No. SR-FINRA-2025-009, are reasonable and it is appropriate that FINRA recover its designated portion of such costs through Prospective CAT Cost Recovery Fee 2025-2. FINRA also has determined that Prospective CAT Cost Recovery Fee 2025-2 provides for the equitable allocation of fees among ( printed page 30175) FINRA members and is not unfairly discriminatory, as discussed herein.

Prospective CAT Cost Recovery Fee 2025-2 is designed to allow FINRA to recover its designated portion of Budgeted CAT Costs 2025-2, consistent with the Exchange Act and the CAT Funding Model Approval Order.^[37] In approving the CAT Funding Model, the Commission noted FINRA's request that it acknowledge “FINRA's need and ability to cover CAT costs that are not recovered through contractual arrangements through member fee increases, so as not to jeopardize FINRA's ability to carry out its critical regulatory mission.” ^[38] The Commission also recognized that “the Exchange Act expressly contemplates the ability of the Participants to recoup their costs to fulfill their statutory obligations under the Exchange Act.” ^[39] The Commission further noted FINRA's statement “that it would file a rule change to increase its member fees with the filing of any proposed rule change to effectuate the Funding Model.” ^[40] The instant proposed rule change to adopt Prospective CAT Cost Recovery Fee 2025-2 represents such a fee with respect to Budgeted CAT Costs 2025-2.^[41]

Without a mechanism to recover its CAT costs, FINRA, which is unique among the Participants as a not-for-profit, national securities association, would not be able to effectively sustain its regulatory mission.^[42] Thus, consistent with the cost allocation framework put in place by the SEC-approved CAT Funding Model, whereby CEBBs and CEBSs share equal responsibility for the costs assessed directly to Industry Members based on their transactions in Eligible Securities, FINRA is seeking to recoup its designated portion of Budgeted CAT Costs 2025-2 in a like manner that is fair, reasonable, and equitably allocated among FINRA's member firms in their capacity as CAT Executing Brokers.

Prospective CAT Cost Recovery Fee 2025-2 is designed to recover FINRA's designated portion of budgeted CAT costs to be incurred by CAT LLC associated with the development, implementation, and operation of the CAT system under the CAT NMS Plan. Thus, Prospective CAT Cost Recovery Fee 2025-2 also generally is designed to support FINRA's efforts to align its operating expenses with its operating revenues, target break-even cash flows over time, and continue to responsibly manage expenses driven by mandatory initiatives, like the CAT NMS Plan, in a manner consistent with FINRA's public Financial Guiding Principles.^[43]

FINRA's approach in determining Prospective CAT Cost Recovery Fee 2025-2, which generally is consistent with the approach provided for under the SEC-approved CAT Funding Model, is also reasonable and consistent with the Exchange Act. Specifically, similar to the CAT cost assessment methodology approved by the Commission, FINRA proposes to allocate equally among member CEBBs and CEBSs FINRA's designated portion of the Participants' one-third share of Budgeted CAT Costs 2025-2.^[44] FINRA proposes to determine the rate for Prospective CAT Cost Recovery Fee 2025-2 by rounding up the CAT Fee 2025-2 rate of $0.000009 to $0.000010 per executed equivalent share and dividing it by two so that member CEBBs and CEBSs would each be subject to an equal fee, i.e., $0.000005 per executed equivalent share, for each transaction in Eligible Securities executed otherwise than on an exchange. Therefore, for each month that Prospective CAT Cost Recovery Fee 2025-2 is in effect, member CEBBs and CEBSs will pay a fee to FINRA based on the same transactions used to determine fees payable by CEBBs and CEBSs to CAT LLC under CAT Fee 2025-2 for off-exchange transactions.^[45] FINRA believes that this approach is reasonable in that, as is the case with the SEC-approved CAT Funding Model, it apportions the assessed fee for members equally between the CAT Executing Broker for the buyer and the seller.^[46]

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. Section 15A(b)(9) of the Act^[47] requires that FINRA's rules not impose any burden on competition that is not necessary or appropriate in furtherance of the purpose of the Exchange Act. FINRA notes that Prospective CAT Cost Recovery Fee 2025-2 is designed to assist FINRA in meeting its regulatory obligations pursuant to the Plan.

Furthermore, in approving the CAT Funding Model, the SEC analyzed the potential competitive impact of the CAT Funding Model, including competitive issues related to market services, trading services and regulatory services, efficiency concerns, and capital formation.^[48] The SEC also analyzed the potential effect of CAT fees calculated pursuant to the CAT Funding Model on affected categories of market participants, including Participants (including exchanges and FINRA), Industry Members (including subcategories of Industry Members, such as alternative trading systems, CAT Executing Brokers and market makers), and investors generally, and considered market effects related to equities and options, among other things.^[49] Based on this analysis, the SEC approved the CAT Funding Model as compliant with the Exchange Act. The Prospective CAT Cost Recovery Fee 2025-2 framework generally is consistent with the fee framework of the CAT Funding Model, as approved by the SEC.

As discussed in File No. SR-FINRA-2025-009, each of the inputs into the calculation of CAT Fee 2025-2 is reasonable and the resulting fee rate for CAT Fee 2025-2 is reasonable. Therefore, Prospective CAT Cost Recovery Fee 2025-2, for these same reasons, is reasonable and would not impose any burden on competition that is not necessary or appropriate in furtherance of the purpose of the Exchange Act. ( printed page 30176)

Economic Impact Assessment

Based on the regulatory need discussed above, FINRA has undertaken an economic impact assessment, as set forth below, to analyze the potential economic impacts of the proposed rule change, including potential costs, benefits, and distributional and competitive effects, relative to the current baseline.

Regulatory Need

As discussed above under the “FINRA's Designated Portion of Budgeted CAT Costs 2025-2” section, FINRA is filing a proposed rule change to establish Prospective CAT Cost Recovery Fee 2025-2 to recover its designated portion of the Participants' share of Budgeted CAT Costs 2025-2.^[50] FINRA intends that the fee framework and timeline for Prospective CAT Cost Recovery Fee 2025-2 generally correspond to the fee framework and timeline put in place by CAT LLC with respect to CAT Fee 2025-2, as provided for in File No. SR-FINRA-2025-009 and as discussed above.

Economic Baseline

As discussed above under the “FINRA's Designated Portion of Budgeted CAT Costs 2025-2” section, FINRA arrived at the fee rate for Prospective CAT Cost Recovery Fee 2025-2 by rounding up the CAT Fee 2025-2 of $0.000009 to $0.000010 per executed equivalent share, and dividing it by two, resulting in a Prospective CAT Cost Recovery Fee 2025-2 of $0.000005.

For the twelve months from April 1, 2024, through March 31, 2025, based on transactions reported to a FINRA TRF or to the ORF, there were 979 firm MPIDs that executed at least one purchase or sale of an equivalent share of an Eligible Security.^[51] The top 50 MPIDs by reported executed equivalent share volume bought and/or sold 2,746,858,365,979 equivalent shares, or 86.22% of total shares bought and/or sold.

Economic Impacts

FINRA's proposal to recover its designated portion of the Participants' share of Prospective CAT Costs generally is consistent with the CAT Funding Model in that, for relevant transactions, FINRA would apply to each of the CEBB and CEBS a Prospective CAT Cost Recovery Fee rate that equals the fee rate that is assessed to FINRA under CAT Fee 2025-2 rounded up to the next even number at the sixth decimal place and divided by two.^[52] With regard to off-exchange transactions in Eligible Securities, generally the same members that will be assessed Prospective CAT Cost Recovery Fee 2025-2 will also be assessed CAT Fee 2025-2. Therefore, FINRA's proposed approach in recovering its designated portion of Budgeted CAT Costs 2025-2 should reduce potential complexity in connection with the fee and billing structure for Prospective CAT Cost Recovery Fee 2025-2.^[53]

As the SEC noted in approving the revised CAT Funding Model, if FINRA passes on its portion of the CAT fee allocation to its member firms and exchanges choose not to pass through their CAT fee allocations to their members, the cost to transact off-exchange may increase relative to executing on an exchange, potentially giving exchanges a competitive advantage.^[54] However, FINRA does not know whether or to what extent (or how) the exchanges may seek to recover their portion of the Budgeted CAT Costs 2025-2, and FINRA does not know whether or to what extent member firms will choose to pass through exchange-incurred CAT fees to customers. FINRA also notes that FINRA members remain subject to regulatory obligations, such as best execution obligations, with respect to their order routing decisions.

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 ^[55] and paragraph (f)(2) of Rule 19b-4 thereunder.^[56] 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.

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 Comments

• Use the Commission's internet comment form (https://www.sec.gov/​rules/​sro.shtml); or
• Send an email torule-comments@sec.gov. Please include file number SR-FINRA-2025-010 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-2025-010. 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 ( https://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 the filing also will be available for inspection and copying at the principal office of FINRA. Do not include personal identifiable information in submissions; you should submit only information that you wish to make available publicly. We may redact in part or withhold entirely from publication submitted material that is obscene or ( printed page 30177) subject to copyright protection. All submissions should refer to file number SR-FINRA-2025-010 and should be submitted on or before July 29, 2025.