1. FINRA Regulatory Notice 19-37 SEC Approves Amendments to FINRA Rules 5130 and 5131 Relating to Equity IPOs

    The SEC approved a rule change to amend FINRA Rule 5130 (Restrictions on the Purchase and Sale of Initial Equity Public Offerings) and FINRA Rule 5131 (New Issue Allocations and Distributions) to modify the rules to enhance regulatory consistency and address unintended operational impediments. These changes become effective on January 1, 2020.

    12/19/2019

  2. SEC Release No. 34-87782 Risk Mitigation Techniques for Uncleared Security-Based Swaps

    The SECis adopting final rules requiring the application of specific risk mitigation techniques to portfolios of uncleared security-based swaps. In particular, these final rules establish requirements for each registered security-based swap dealer (“SBS dealer”) and each registered major security-based swap participant (“major SBS participant”) with respect to, among other things, reconciling outstanding security-based swaps with applicable counterparties on a periodic basis, engaging in certain forms of portfolio compression exercises, as appropriate, and executing written security-based swap trading relationship documentation with each of its counterparties prior to, or contemporaneously with, executing a security-based swap transaction. In addition, the Commission is issuing an interpretation addressing the application of the portfolio reconciliation, portfolio compression, and trading relationship documentation requirements to cross-border security-based swap activities and is amending Rule 3a71-6 to address the potential availability of substituted compliance in connection with those requirements. Lastly, the final rules include corresponding amendments to the recordkeeping, reporting, and notification requirements applicable to SBS Entities.

    12/18/2019

  3. SEC Release No. 34-87780 Rule Amendments and Guidance Addressing Cross-Border Application of Certain Security-Based Swap Requirements

    The SEC is adopting rule amendments and providing guidance to address the cross-border application of certain security-based swap requirements under the Securities Exchange Act of 1934 that were added by Title VII of the Dodd-Frank Act”. The Commission also is issuing a statement regarding compliance with rules for security-based swap data repositories and Regulation SBSR.

    12/18/2019

  4. SR-NASDAQ-2019-092 Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Amend Exchange Rule 5515 Which Governs the Listing of Warrants on the Nasdaq Capital Market

    The Exchange has amended amend Exchange Rule 5515 which governs the listing of warrants on the Nasdaq Capital Market. Specifically, Nasdaq proposes to replace the current requirement that a warrant have 400 Round-Lot Holders with a revised requirement of 100 Holders that are both Public Holders and Round-Lot Holders, which is substantially similar to a long-standing requirement for listing warrants on the NYSE American Exchange.

    12/12/2019

  5. FINRA Regulatory Notice 19-36 FINRA Requests Comment on a Proposed Rule to Limit a Registered Person from Being Named a Customer’s Beneficiary or Holding a Position of Trust for or on Behalf of a Customer

    Investment professionals often develop close and trusted relationships with their customers, which in some instances have resulted in the investment professional being named the customer’s beneficiary, executor or trustee, or holding a power of attorney or a similar position for the customer. Being a customer’s beneficiary or holding a position of trust may present significant conflicts of interest, and FINRA has previously taken steps to address misconduct in this area. To further address potential conflicts of interest, FINRA is proposing a new rule to limit any associated person of a member firm who is registered with FINRA (each a “registered person”) from being named a beneficiary, executor or trustee, or to have a power of attorney or similar position of trust for or on behalf of a customer. The proposed rule would protect investors by requiring all member firms to affirmatively address registered persons being named beneficiaries or holding positions of trusts for customers. The proposed rule would require the member firm with which the registered person is associated, upon receiving written notice from the registered person, to review and approve the registered person assuming such status or acting in such capacity. The proposed rule would not apply where the customer is a member of the registered person’s “immediate family.”

    11/11/2019

  6. MSRB Regulatory Notice 2019-20 SEC Approves Amendments to Underwriters’ Fair Dealing Obligations to Issuers Under Rule G-17

    The Municipal Securities Rulemaking Board (MSRB) received approval from the U.S. Securities and Exchange Commission (SEC) on November 6, 2019 to amend and restate the MSRB’s August 2, 2012 Interpretive Notice regarding the fair dealing obligations underwriters owe to issuers of municipal securities under MSRB Rule G-17 (the “SEC approval order”).

    11/8/2019

  7. SR-NASDAQ-2019-086 Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Make Permanent Certain Options Market Rules That Are Linked to the Equity Market Plan to Address Extraordinary Market Volatility

    The purpose of the proposed rule change is to make permanent certain options market rules in connection with the equity market Plan to Address Extraordinary Market Volatility (the “Limit Up-Limit Down Plan” or the “Plan”). This change is being proposed in connection with the recently approved amendment to the Limit Up-Limit Down Plan that allows the Plan to continue to operate on a permanent basis (“Amendment 18”). This proposed rule change is substantially similar to a recently-approved rule change by Cboe Exchange, Inc. (“Cboe”).

    10/21/2019

  8. MSRB Regulatory Notice 2019-19 MSRB Revises Content Outline for the Municipal Advisor Principal Qualification Examination

    The MSRB filed a proposed rule change with the SEC, on October 18, 2019, to revise the content outline for the Municipal Advisor Principal Qualification Examination (Series 54).1 The content outline for the Series 54 examination has been revised to incorporate MSRB Rule G-40, on advertising by municipal advisors, add a description of the functions and knowledge required to perform the supervisory tasks related to Rule G-40, and make other technical changes to clarify topic descriptions. The MSRB filed the revisions to the content outline for the Series 54 examination for immediate effectiveness and intends to make the permanent Series 54 examination available on November 12, 2019. As provided for under MSRB Rule G-3, municipal advisor principals are required to take and pass the Series 54 examination in order to become appropriately qualified to engage in the management, direction or supervision of the municipal advisory activities of the municipal advisor and its associated persons. To facilitate the transition to the new examination requirement, the MSRB is providing a one-year grace period, sunsetting on November

    10/18/2019

  9. FINRA Regulatory Notice 19-34 Annual Compliance Meetings Retrospective Rule Review Report and Guidance

    In April 2018, FINRA launched a retrospective review of the annual compliance meeting (ACM) requirement in Rule 3110(a)(7) and corresponding Supplementary Material .04 (SM .04), to assess its effectiveness and efficiency. The review is part of an ongoing initiative to periodically look back at a rule or set of rules to ensure they remain relevant and appropriately designed to achieve their regulatory objectives, particularly in light of industry, market and technology changes. Based on the assessment, which involved feedback from both internal stakeholders and a wide range of external stakeholders, FINRA has determined to maintain the requirement without change. This Notice summarizes the review process, the predominant themes that emerged from stakeholder feedback and the basis for the determination. While the review confirmed the continuing importance of Rule 3110(a)(7), some stakeholders asked for some clarifying guidance concerning the various ways in which annual compliance meetings may be conducted. That guidance is also set forth in this Notice

    10/18/2019

  10. MSRB Regulatory Notice 2019-18 MSRB to Launch Permanent Series 54 Examination November 12, 2019

    The MSRB permanent Municipal Advisor Principal Qualification Examination (Series 54) will be available beginning November 12, 2019. As provided for under MSRB Rule G-3, municipal advisor principals2 are required to take and pass the Series 54 examination in order to become appropriately qualified to engage in the management, direction or supervision of the municipal advisory activities of the municipal advisor and its associated persons.3 To facilitate the transition to the new exam requirement, the MSRB is providing a one-year grace period, sunsetting on November 12, 2020, during which individuals qualified with the Series 50 examination will be able to take the Series 54 examination while continuing to engage in principal-level activities. The score required to pass the Series 54 examination is 70 percent.

    10/11/2019

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