On February 17, 2016, the FDIC and SEC approved the issuance of a proposed rule concerning how the agencies would administer a Dodd-Frank Act Title II orderly liquidation authority proceeding for broker-dealers. The proposed rule would: (i) clarify how the relevant provisions of Securities Investor Protection Act would be incorporated into a Title II proceeding; (ii) specify the purpose and content of the application for a protective decree required by section 205 of the SIPA; (iii) clarify the FDIC’s powers as receiver with respect to the transfer of assets of a covered broker or dealer to a bridge broker or dealer; (iv) specify the roles of the FDIC as receiver and the Securities Investor Protection Corporation as trustee with respect to a covered broker or dealer; (v) describe the claims process applicable to customers and other creditors of a covered broker or dealer, including the interaction of the determination of customer claims under SIPA with the Title II claims process; (vi) provide for SIPC’s administrative expenses; and (vii) provide that the treatment of qualified financial contracts of the covered broker or dealer would be governed exclusively by section 210 of the Dodd-Frank Act. The comment period is 60 days from publication in the Federal Register.
The proposed rule is available at: http://www.sec.gov/rules/proposed/2016/34-77157.pdf.
A memorandum on the issuance is available at: https://fdic.gov/news/board/2016/2016-02-17_notice_sum_a_mem.pdf.