FINRA Outlines Key Rulemaking Priorities and Recent Developments in Quarterly Agenda
From the desk of Jim Eccleston at 蘑菇传媒
The Financial Industry Regulatory Authority (FINRA) recently released its Quarterly Regulatory Policy Agenda, offering a detailed view of its rulemaking priorities, pending proposals, and recently approved regulatory changes.
Current Priorities
FINRA identified a broad set of regulatory priorities that reflect its ongoing focus on modernizing rules, reducing operational burdens, and enhancing investor protection. The organization continues to evaluate improvements to its arbitration framework, including potential updates to rules, guidance, and procedures.
FINRA also plans to issue guidance on the payment of transaction-based compensation to personal services entities in light of an SEC staff no action letter. In addition, FINRA is advancing proposed amendments to account documentation requirements under Rule 4515 to address operational challenges.
Several proposals target greater clarity and efficiency in industry operations. The initiatives include amendments to Rule 4311 governing carrying agreements, enhancements to electronic delivery of information to customers, and the potential expansion of electronic delivery under FINRA Rule 8210 for information requests to firms and advisors. FINRA also continues to evaluate updates to financial recordkeeping requirements, including amendments to Rule 4522.
Additional priorities focus on broader structural and policy changes. FINRA is considering amendments related to branch office and residential supervisory locations, corporate financing rules, and extended hours trading under Rules 6380A and 6380B. The organization also continues to evaluate its Remote Inspections Pilot Program and potential updates to arbitration procedures regarding replacement arbitrators.
FINRA also has prioritized investor protection initiatives, including efforts to strengthen safeguards for senior investors and address account transfer fraud. The organization is further reviewing potential updates to communications with the public, membership application processes, and supervision rules.
Active Rule Filings
FINRA currently has several rule proposals pending before the SEC. The proposals include proposed amendments to Rule 2210 governing communications with the public, and changes to Rules 5110 and 5123 addressing underwriting terms and private placements. FINRA has also proposed adopting Rule 3290 concerning outside activities requirements and revising Rule 4210 to replace day trading margin provisions with intraday margin standards.
Recently Approved and Effective Rule Filings
The agenda also highlights rule changes that the SEC has approved or that FINRA has filed for immediate effectiveness within the past year. The updates include amendments to Rule 3220 addressing the influencing or rewarding of employees of others, as well as changes to capital acquisition broker rules with a defined implementation timeline.
FINRA has adopted new provisions such as Rule 7660B related to trade reporting facility fees for non-participants and amended Rule 6830 concerning data reporting and the bona fide market making exception under Regulation SHO. Additional updates align FINRA rules with the revised definition of "round lot" under Regulation NMS and modify reporting fees and transaction reporting requirements.
The organization has also implemented procedural and operational changes, including updates to arbitration processes, time stamp requirements under Rule 6860, and expanded trade reporting facility operating hours. Other recent actions address disclosure of order execution information, consolidated audit trail funding fees, and the effectiveness of certain sanctions and disciplinary actions.
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