On March 25, the Securities and Exchange Commission proposed amendments to Rule 15b9-1 under the Securities Exchange Act of 1934 to require broker-dealers that engage in off-exchange proprietary trading to become members of a registered national securities association such as FINRA (the Corporate & Financial Weekly Digest article describing this proposal is available here). On May 4, the Financial Industry Regulatory Authority released Regulatory Notice 15-13 to request comment on a proposal that would exempt proprietary trading firms, that would be required to become FINRA members under the SEC’s proposed amendments, from FINRA’s Trading Activity Fee ( TAF).
The TAF is based on trading activity and generally applies to all sales of a covered security regardless of where it is executed. FINRA has analyzed the potential impact that the TAF would have on proprietary trading firms and believes that, for certain trades, the resulting costs incurred by these firms would be disproportionate to FINRA’s anticipated costs of monitoring these transactions. As such, FINRA is requesting comments on a proposed exemption to the TAF for transactions effected by proprietary trading firms on those exchanges at which they are a member. The comment period ends June 19.
FINRA Regulatory Notice 15-13 is available here.