15286 Federal Register / Vol. 87, No. 52 / Thursday, March 17, 2022 / Notices 

19 15 U.S.C. 78s(b)(3)(A). 

20 17 CFR 240.19b–4(f)(6). 

21 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6)(iii) requires a self-regulatory organization to 

give the Commission written notice of its intent to 

file the proposed rule change, along with a brief 

description and text of the proposed rule change, 

at least five business days prior to the date of filing 

of the proposed rule change, or such shorter time 

as designated by the Commission. The Exchange 

satisfied this requirement. 

22 17 CFR 240.19b–4(f)(6). 

23 17 CFR 240.19b–4(f)(6)(iii). 

24See Securities Exchange Act Release Nos. 

93147, supra note 9, and 93546, supra note 10. 

25For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposed rule’s impact on efficiency, competition, 

and capital formation. See 15 U.S.C. 78c(f). 26 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

19(b)(3)(A) of the Act 19 and Rule 19b– 

4(f)(6) 20 thereunder.21

A proposed rule change filed under 

Rule 19b–4(f)(6) 22 normally does not 

become operative prior to 30 days after 

the date of the filing. However, pursuant 

to Rule 19b–4(f)(6)(iii),23 the 

Commission may designate a shorter 

time if such action is consistent with the 

protection of investors and the public 

interest. The Exchange has asked the 

Commission to waive the 30-day 

operative delay so that the proposed 

rule change may take effect upon filing. 

The Exchange represents that the Funds 

will continue to comply with the 

requirements of BZX Rule 14.11(m). The 

Commission believes that waiver of the 

30-day operative delay is consistent 

with the protection of investors and the 

public interest because the proposed 

rule change does not raise any new or 

novel issues.24 Accordingly, the 

Commission waives the 30-day 

operative delay and designates the 

proposal operative upon filing.25

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 

change 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 (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

CboeBZX–2022–016 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–CboeBZX–2022–016. 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 (http://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 

10:00 a.m. and 3:00 p.m. Copies of the 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–CboeBZX–2022–016 and 

should be submitted on or before April 

7, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.26

Eduardo Aleman, 

Assistant Secretary. 

[FR Doc. 2022–05601 Filed 3–16–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94400; File No. SR– 

NASDAQ–2022–021] 

Self-Regulatory Organizations; The 

Nasdaq Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend the 

Exchange Registration Rules in 

General 4 

March 11, 2022. 

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 March 7, 

2022, The Nasdaq Stock Market LLC 

(‘‘Nasdaq’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘SEC’’ or ‘‘Commission’’) the proposed 

rule change as described in Items I and 

II below, which Items have been 

substantially prepared by the Exchange. 

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 

The Exchange proposes to amend 

General 4, Rule 1240 (Continuing 

Education Requirements). While these 

amendments are effective upon filing, 

the Exchange has designated the 

proposed amendments to be operative 

on March 15, 2022. 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://www.listingcenter.nasdaq.com/ 

rulebook/nasdaq/rules, at the principal 

office of the Exchange, 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, the 

Exchange 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. The 

Exchange has prepared summaries, set 

forth in sections A, B, and C below, of 

the most significant aspects of such 

statements. 


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3See Securities Exchange Act Release No. 93097 

(September 21, 2021), 86 FR 53358 (September 27, 

2021) (SR–FINRA–2021–015) (‘‘FINRA Rule 

Change’’). 

4See Securities Exchange Release No. 91262 

(March 5, 2021), 86 FR 13935 (March 11, 2021) (SR– 

FINRA–2021–003). 

5See supra notes 3 and 4. 

6See also General 4, Rule 1210.07 (All Registered 

Persons Must Satisfy the Regulatory Element of 

Continuing Education). 

7See General 4, Rules 1240(a)(1) (Requirements) 

and (a)(4) (Reassociation in a Registered Capacity). 

An individual’s registration anniversary date is 

generally the date they initially registered with the 

Exchange in the Central Registration Depository 

(‘‘CRD®’’) system. However, an individual’s 

registration anniversary date would be reset if the 

individual has been out of the industry for two or 

more years and is required to requalify by 

examination, or obtain an examination waiver, in 

order to reregister. An individual’s registration 

anniversary date would also be reset if the 

individual obtains a conditional examination 

waiver that requires them to complete the 

Regulatory Element by a specified date. Nonregistered individuals who are participating in the 

waiver program under General 4, Rule 1210.09 

(Waiver of Examinations for Individuals Working 

for a Financial Services Industry Affiliate of a 

Member) (‘‘FSAWP participants’’) are also subject to 

the Regulatory Element. See also General 4, Rule 

1240(a)(5) (Definition of Covered Person). The 

Regulatory Element for FSAWP participants 

correlates to their most recent registration(s), and it 

must be completed based on the same cycle had 

they remained registered. FSAWP participants are 

eligible for a single, fixed seven-year waiver period 

from the date of their initial designation, subject to 

specified conditions. Registered persons who 

become subject to a significant disciplinary action, 

as specified in General 4, Rule 1240(a)(3) 

(Disciplinary Actions), may be required to retake 

the Regulatory Element within 120 days of the 

effective date of the disciplinary action, if they 

remain registered. Further, their cycle for 

participation in the Regulatory Element may be 

adjusted to reflect the effective date of the 

disciplinary action rather than their registration 

anniversary date. 

8See General 4, Rule 1240(a)(2) (Failure to 

Complete). 

9See supra note 8. Individuals must complete the 

entire Regulatory Element session to be considered 

to have ‘‘completed’’ the Regulatory Element; 

partial completion is the same as non-completion. 

10This CE inactive two-year period is calculated 

from the date such persons become CE inactive, and 

it continues to run regardless of whether they 

terminate their registrations before the end of the 

two-year period. Therefore, if registered persons 

terminate their registrations while in a CE inactive 

status, they must satisfy all outstanding Regulatory 

Element prior to the end of the CE inactive two-year 

period in order to reregister with a member without 

having to requalify by examination or having to 

obtain an examination waiver. 

11The S101 (General Program for Registered 

Persons) and the S201 (Registered Principals and 

Supervisors). 

12The current content is presented in a single 

format leading individuals through a case that 

provides a story depicting situations that they may 

encounter in the course of their work. 

13The rule defines ‘‘covered registered persons’’ 

as any registered person who has direct contact 

with customers in the conduct of a member’s 

securities sales and trading activities, and the 

immediate supervisors of any such persons. See 

General 4, Rule 1240(b)(1) (Persons Subject to the 

Firm Element). 

14See General 4, Rule 1240(b)(2) (Standards for 

the Firm Element). 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend its 

continuing education requirements in 

General 4, Rule 1240. This proposed 

rule change is based on a filing recently 

submitted by the Financial Industry 

Regulatory Authority, Inc. (‘‘FINRA’’), 

and is intended to harmonize the 

Exchange’s continuing education rules 

with those of FINRA so as to promote 

uniform standards across the securities 

industry.3 The Exchange also proposes 

to amend its manual signature 

requirements in General 4, Rule 1250 

(Form U4 Filing Requirements) to align 

with changes FINRA has made to 

similar rules.4 Each change is discussed 

in detail below. 

The proposed changes are based on 

the changes approved by the 

Commission in the approval order for 

SR–FINRA–2021–015 and as noticed in 

SR–FINRA–2021–003.5 The Exchange is 

proposing to adopt such changes 

substantially in the same form as 

proposed by FINRA, with only minor 

changes necessary to conform to the 

Exchange’s existing rules such as to 

remove cross-references and rules that 

are applicable to FINRA members but 

not to Exchange members. 

Continuing Education Rules 

(i) Background 

The continuing education program for 

registered persons of broker-dealers 

(‘‘CE Program’’) currently requires 

registered persons to complete 

continuing education consisting of a 

Regulatory Element and a Firm Element. 

The Regulatory Element, which is 

administered by FINRA, focuses on 

regulatory requirements and industry 

standards, while the Firm Element is 

provided by each firm and focuses on 

securities products, services and 

strategies the firm offers, firm policies 

and industry trends. The CE Program is 

codified under the rules of the selfregulatory organizations (‘‘SROs’’). The 

CE Program for registered persons of 

Exchange members is codified under 

General 4, Rule 1240.6

a. Regulatory Element 

General 4, Rule 1240(a) (Regulatory 

Element) currently requires a registered 

person to complete the applicable 

Regulatory Element initially within 120 

days after the person’s second 

registration anniversary date and, 

thereafter, within 120 days after every 

third registration anniversary date.7 The 

Exchange may extend these time frames 

for good cause shown.8 Registered 

persons who have not completed the 

Regulatory Element within the 

prescribed time frames will have their 

Exchange registrations deemed inactive 

and will be designated as ‘‘CE inactive’’ 

in the CRD system until the 

requirements of the Regulatory Element 

have been satisfied.9 A CE inactive 

person is prohibited from performing, or 

being compensated for, any activities 

requiring FINRA registration, including 

supervision. Moreover, if registered 

persons remain CE inactive for two 

consecutive years, they must requalify 

by retaking required examinations (or 

obtain a waiver of the applicable 

qualification examinations).10

The Regulatory Element consists of a 

subprogram for registered persons 

generally, and a subprogram for 

principals and supervisors.11 While 

some of the current Regulatory Element 

content is unique to particular 

registration categories, most of the 

content has broad application to both 

representatives and principals.12

The Regulatory Element was 

originally designed at a time when most 

individuals had to complete the 

Regulatory Element at a test center, and 

its design was shaped by the limitations 

of the test center-based delivery model. 

In 2015, FINRA transitioned the 

delivery of the Regulatory Element to an 

online platform (‘‘CE Online’’), which 

allows individuals to complete the 

content online at a location of their 

choosing, including their private 

residence. This online delivery provides 

the Exchange with much greater 

flexibility in updating content in a 

timelier fashion, developing content 

tailored to each registration category 

and presenting the material in an 

optimal learning format. 

b. Firm Element 

General 4, Rule 1240(b) (Firm 

Element) currently requires each firm to 

develop and administer an annual Firm 

Element training program for covered 

registered persons.13 The rule requires 

firms to conduct an annual needs 

analysis to determine the appropriate 

training.14 Currently, at a minimum, the 

Firm Element must cover training in 

ethics and professional responsibility as 

well as the following items concerning 

securities products, services and 

strategies offered by the member: (1) 

General investment features and 

associated risk factors; (2) suitability 

and sales practice considerations; and 


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15See supra note 14. 

16See General 9, Sections 20 and 37. 

17See General 4, Rule 1210.08 (Lapse of 

Registration and Expiration of SIE). The two-year 

qualification period is calculated from the date 

individuals terminate their registration and the date 

the Exchange receives a new application for 

registration. The two-year qualification period does 

not apply to individuals who terminate a limited 

registration category that is a subset of a broader 

registration category for which they remain 

qualified. For instance, it would not apply to an 

individual who maintains his registration as a 

General Securities Representative but who 

terminates his registration as an Investment 

Company and Variable Contracts Products 

Representative. Such individuals have the option of 

reregistering in the more limited registration 

category without having to requalify by 

examination or obtain an examination waiver so 

long as they continue to remain qualified for the 

broader registration category. Further, the two-year 

qualification period only applies to the 

representative- and principal-level examinations; it 

does not extend to the Securities Industry Essentials 

(‘‘SIE’’) examination. The SIE examination is valid 

for four years, but having a valid SIE examination 

alone does not qualify an individual for registration 

as a representative or principal. Individuals whose 

registrations as representatives or principals have 

been revoked pursuant to General 5, Rule 8310 

(Sanctions for Violation of the Rules) may only 

requalify by retaking the applicable representativeor principal-level examination in order to reregister 

as representatives or principals, in addition to 

satisfying the eligibility conditions for association 

with a firm. Waivers are granted either on a caseby-case basis under General 4, Rule 1210.03 

(Qualification Examinations and Waivers of 

Examinations) or as part of the waiver program 

under General 4, Rule 1210.09. 

18See supra note 3. FINRA’s changes are based 

on the CE Council’s September 2019 

recommendations to enhance the CE Program. See 

Recommended Enhancements for the Securities 

Industry Continuing Education Program, available 

at http://cecouncil.org/media/266634/councilrecommendations-final-.pdf. The CE Council is 

composed of securities industry representatives and 

representatives of SROs. The CE Council was 

formed in 1995 upon a recommendation from the 

Securities Industry Task Force on Continuing 

Education and was tasked with facilitating the 

development of uniform continuing education 

requirements for registered persons of brokerdealers. 

19When the CE Program was originally adopted 

in 1995, registered persons were required to 

complete the Regulatory Element on their second, 

fifth and 10th registration anniversary dates. See 

Securities Exchange Act Release No. 35341 

(February 8, 1995), 60 FR 8426 (February 14, 1995) 

(Order Approving File Nos. SR–AMEX–94–59; SR– 

CBOE–94–49; SR–CHX–94–27; SR–MSRB–94–17; 

SR–NASD–94–72; SR–NYSE–94–43; SR–PSE–94– 

35; and SR–PHLX–94–52). The change to the 

current three-year cycle was made in 1998 to 

provide registered persons more timely and 

effective training, consistent with the overall 

purpose of the Regulatory Element. See Securities 

Exchange Act Release No. 39712 (March 3, 1998), 

63 FR 11939 (March 11, 1998) (Order Approving 

File Nos. SR–CBOE–97–68; SR–MSRB–98–02; SR– 

NASD–98–03; and SR–NYSE–97–33). 

20See proposed General 4, Rules 1240(a)(1) and 

(a)(4). 

21See proposed General 4, Rules 1210.07 and 

1240(a)(1). 

22See proposed General 4, Rules 1240(a)(1) and 

(a)(4). 

23See proposed General 4, Rule 1240(a)(1). 

24See proposed General 4, Rule 1240(a)(4). 

25See proposed General 4, Rule 1240(a)(2). 

26See supra note 25. The proposed rule change 

clarifies that the request for an extension of time 

must be in writing and include supporting 

documentation, which is consistent with current 

practice. 

27See supra note 25. 

(3) applicable regulatory 

requirements.15

A firm, consistent with its needs 

analysis, may determine to apply 

toward the Firm Element other required 

training. The current rule does not 

expressly recognize other required 

training, such as training relating to the 

anti-money laundering (‘‘AML’’) 

compliance program and training 

relating to the annual compliance 

meeting,16 for purposes of satisfying 

Firm Element training. 

c. Termination of a Registration 

Currently, individuals whose 

registrations as representatives or 

principals have been terminated for two 

or more years may reregister as 

representatives or principals only if they 

requalify by retaking and passing the 

applicable representative- or principallevel examination or if they obtain a 

waiver of such examination(s) (the 

‘‘two-year qualification period’’).17 The 

two-year qualification period was 

adopted prior to the creation of the CE 

Program and was intended to ensure 

that individuals who reregister are 

relatively current on their regulatory 

and securities knowledge. 

(ii) Proposed Rule Change 

After extensive work with the 

Securities Industry/Regulatory Council 

on Continuing Education (‘‘CE 

Council’’) and discussions with 

stakeholders, including industry 

participants and the North American 

Securities Administrators Association 

(‘‘NASAA’’), FINRA adopted the 

following changes to the CE Program 

under its rules.18 In order to promote 

uniform standards across the securities 

industry, the Exchange now proposes to 

adopt the same changes to its 

continuing education rules. 

a. Transition to Annual Regulatory 

Element for Each Registration Category 

As noted above, currently, the 

Regulatory Element generally must be 

completed every three years, and the 

content is broad in nature. Based on 

changes in technology and learning 

theory, the Regulatory Element content 

can be updated and delivered in a 

timelier fashion and tailored to each 

registration category, which would 

further the goals of the Regulatory 

Element.19 Therefore, to provide 

registered persons with more timely and 

relevant training on significant 

regulatory developments, the Exchange 

proposes amending General 4, Rule 

1240(a) to require registered persons to 

complete the Regulatory Element 

annually by December 31.20 The 

proposed amendment would also 

require registered persons to complete 

Regulatory Element content for each 

representative or principal registration 

category that they hold, which would 

also further the goals of the Regulatory 

Element.21

Under the proposed rule change, 

firms would have the flexibility to 

require their registered persons to 

complete the Regulatory Element sooner 

than December 31, which would allow 

firms to coordinate the timing of the 

Regulatory Element with other training 

requirements, including the Firm 

Element.22 For example, a firm could 

require its registered persons to 

complete both their Regulatory Element 

and Firm Element by October 1 of each 

year. 

Individuals who would be registering 

as a representative or principal for the 

first time on or after the implementation 

date of the proposed rule change would 

be required to complete their initial 

Regulatory Element for that registration 

category in the next calendar year 

following their registration.23 In 

addition, subject to specified 

conditions, individuals who would be 

reregistering as a representative or 

principal on or after the implementation 

date of the proposed rule change would 

also be required to complete their initial 

Regulatory Element for that registration 

category in the next calendar year 

following their reregistration.24

Consistent with current requirements, 

individuals who fail to complete their 

Regulatory Element within the 

prescribed period would be 

automatically designated as CE 

inactive.25 However, the proposed rule 

change preserves the Exchange’s ability 

to extend the time by which a registered 

person must complete the Regulatory 

Element for good cause shown.26

The Exchange also proposes 

amending General 4, Rule 1240(a) to 

clarify that: (1) Individuals who are 

designated as CE inactive would be 

required to complete all of their pending 

and upcoming annual Regulatory 

Element, including any annual 

Regulatory Element that becomes due 

during their CE inactive period, to 

return to active status; 27 (2) the twoyear CE inactive period is calculated 

from the date individuals become CE 

inactive, and it continues to run 

regardless of whether individuals 


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28See supra note 25. 29See proposed General 4, Rule 1240(a)(3). As 

previously noted, General 4, Rule 1240(a)(3) 

currently provides that such individuals may be 

required to retake the Regulatory Element. See 

supra note 7. 30See proposed General 4, Rule 1240(a)(4). 31See proposed General 4, Rule 1240(a)(5). 32As discussed in the economic impact 

assessment in the FINRA Rule Change, individuals 

with multiple registrations represent a smaller 

percentage of the population of registered persons. 

33See proposed General 4, Rule 1240(b)(2)(D). 

34See proposed General 4, Rule 1240(b)(1). As 

noted earlier, the current requirement only applies 

to ‘‘covered registered persons’’ and not all 

registered persons. 

35See proposed General 4, Rule 1240(b)(2)(B). 

36The proposed option would also be available to 

individuals who terminate any permissive 

registrations as provided under General 4, Rule 

1210.02. However, the proposed option would not 

be available to individuals who terminate a limited 

registration category that is a subset of a broader 

registration category for which they remain 

qualified. As previously noted, such individuals 

currently have the option of reregistering in the 

more limited registration category without having to 

requalify by examination or obtain an examination 

waiver so long as they continue to remain qualified 

for the broader registration category. In addition, 

the proposed option would not be available to 

individuals who are maintaining an eliminated 

registration category, such as the category for 

Corporate Securities Representative, or individuals 

who have solely passed the Securities Industry 

Essentials examination, which does not, in and of 

itself, confer registration. 

37See proposed General 4, Rule 1240(c)(1). 

38See proposed General 4, Rule 1240(c)(2). 

Individuals who elect to participate at the later date 

would be required to complete, within two years 

from the termination of their registration, any 

continuing education that becomes due between the 

time of their Form U5 (Uniform Termination Notice 

for Securities Industry Registration) submission and 

the date that they commence their participation. In 

addition, FINRA would enhance its systems to 

notify individuals of their eligibility to participate, 

enable them to affirmatively opt in, and notify them 

of their annual continuing education requirement if 

they opt in. 

39See proposed General 4, Rule 1240(c)(3). 

However, upon a participant’s request and for good 

cause shown, the Exchange would have the ability 

to grant an extension of time for the participant to 

complete the prescribed continuing education. A 

participant who is also a registered person must 

directly request an extension of the prescribed 

continuing education from the Exchange. The 

continuing education content for participants 

would consist of a combination of Regulatory 

Element content and content selected by FINRA 

and the CE Council from the Firm Element content 

catalog discussed below. The content would 

correspond to the registration category for which 

individuals wish to maintain their qualifications. 

Participants who are maintaining their qualification 

status for a principal registration category that 

Continued 

terminate their registrations; 28 (3) 

individuals who become subject to a 

significant disciplinary action may be 

required to complete assigned 

continuing education content as 

prescribed by the Exchange; 29 (4) 

individuals who have not completed 

any Regulatory Element content for a 

registration category in the calendar 

year(s) prior to reregistering would not 

be approved for registration for that 

category until they complete that 

Regulatory Element content, pass an 

examination for that registration 

category or obtain an unconditional 

examination waiver for that registration 

category, whichever is applicable; 30 and 

(5) the Regulatory Element requirements 

apply to individuals who are registered, 

or in the process of registering, as a 

representative or principal.31 In 

addition, the Exchange proposes making 

conforming amendments to General 4, 

Rule 1210.07. 

Under the proposed rule change, the 

amount of content that registered 

persons would be required to complete 

in a three-year, annual cycle for a 

particular registration category is 

expected to be comparable to what most 

registered persons are currently 

completing every three years. In some 

years, there may be more required 

content for some registration categories 

depending on the volume of rule 

changes and regulatory issues. In 

addition, an individual who holds 

multiple registrations may be required 

to complete additional content 

compared to an individual who holds a 

single registration because, as noted 

above, individuals would be required to 

complete content specific to each 

registration category that they hold.32

However, individuals with multiple 

registrations would not be subject to 

duplicative regulatory content in any 

given year. The more common 

registration combinations would likely 

share much of their relevant regulatory 

content each year. For example, 

individuals registered as General 

Securities Representatives and General 

Securities Principals would receive the 

same content as individuals solely 

registered as General Securities 

Representatives, supplemented with a 

likely smaller amount of supervisoryspecific content on the same topics. The 

less common registration combinations 

may result in less topic overlap and 

more content overall. 

b. Recognition of Other Training 

Requirements for Firm Element and 

Extension of Firm Element to All 

Registered Persons 

To better align the Exchange’s 

rulebook with FINRA’s rulebook, and, 

in addition, to better align the Firm 

Element requirement with other 

required training, the Exchange 

proposes amending General 4, Rule 

1240(b) to expressly allow firms to 

consider training relating to the AML 

compliance program and the annual 

compliance meeting toward satisfying 

an individual’s annual Firm Element 

requirement.33 The Exchange also 

proposes amending the rule to extend 

the Firm Element requirement to all 

registered persons, including 

individuals who maintain solely a 

permissive registration consistent with 

General 4, Rule 1210.02 (Permissive 

Registrations), thereby further aligning 

the Firm Element requirement with 

other broadly-based training 

requirements.34 In conjunction with this 

proposed change, the Exchange 

proposes modifying the current 

minimum training criteria under 

General 4, Rule 1240(b) to instead 

provide that the training must cover 

topics related to the role, activities or 

responsibilities of the registered person 

and to professional responsibility.35

c. Maintenance of Qualification After 

Termination of Registration 

The Exchange proposes adopting 

paragraph (c) under General 4, Rule 

1240 and Supplementary Material .01 

and .02 to General 4, Rule 1240 to 

provide eligible individuals who 

terminate any of their representative or 

principal registrations the option of 

maintaining their qualification for any 

of the terminated registrations by 

completing continuing education.36 The 

proposed rule change would not 

eliminate the two-year qualification 

period. Rather, it would provide such 

individuals an alternative means of 

staying current on their regulatory and 

securities knowledge following the 

termination of a registration(s). Eligible 

individuals who elect not to participate 

in the proposed continuing education 

program would continue to be subject to 

the current two-year qualification 

period. The proposed rule change is 

generally aligned with other 

professional continuing education 

programs that allow individuals to 

maintain their qualification to work in 

their respective fields during a period of 

absence from their careers (including an 

absence of more than two years) by 

satisfying continuing education 

requirements for their credential. 

The proposed rule change would 

impose the following conditions and 

limitations: 

• Individuals would be required to be 

registered in the terminated registration 

category for at least one year 

immediately prior to the termination of 

that category; 37

• individuals could elect to 

participate when they terminate a 

registration or within two years from the 

termination of a registration; 38

• individuals would be required to 

complete annually all prescribed 

continuing education; 39


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includes one or more corequisite representative 

registrations must also complete required annual 

continuing education for the corequisite 

registrations in order to maintain their qualification 

status for the principal registration category. The 

proposed rule change clarifies that the prescribed 

continuing education must be completed by 

December 31 of the calendar year, which is 

consistent with the timing for the proposed annual 

Regulatory Element. 

40See proposed General 4, Rule 1240(c). In 

addition, individuals applying for reregistration 

must satisfy all other requirements relating to the 

registration process (e.g., submit a Form U4 

(Uniform Application for Securities Industry 

Registration or Transfer) and undergo a background 

check). 

41See proposed General 4, Rules 1240(c)(4) and 

(c)(5). 

42See proposed General 4, Rules 1240(c)(1) and 

(c)(6). Further, any content completed by 

participants would be retroactively nullified upon 

disclosure of the statutory disqualification. The 

following example illustrates the application of the 

proposed rule change to individuals who become 

subject to a statutory disqualification while 

participating in the proposed continuing education 

program. Individual A participates in the proposed 

continuing education program for four years and 

completes the prescribed content for each of those 

years. During year five of his participation, he 

becomes subject to a statutory disqualification 

resulting from a foreign regulatory action. In that 

same year, the Exchange receives a Form U4 

submitted by a member on behalf of Individual A 

requesting registration with the Exchange. The 

Form U4 discloses the statutory disqualification 

event. The Exchange would then retroactively 

nullify any content that Individual A completed 

while participating in the proposed continuing 

education program. Therefore, in this example, in 

order to become registered with the Exchange, he 

would be required to requalify by examination. This 

would be in addition to satisfying the eligibility 

conditions for association with an Exchange 

member firm. See Exchange Act Sections 3(a)(39) 

and 15(b)(4) and General 3, Rule 1002. 

43See proposed Supplementary Material .01 to 

General 4, Rule 1240. Such individuals would be 

required to elect whether to participate by the 

implementation date of the proposed rule change. 

If such individuals elect to participate, they would 

be required to complete their initial annual content 

by the end of the calendar year in which the 

proposed rule change is implemented. In addition, 

if such individuals elect to participate, their initial 

participation period would be adjusted based on the 

date that their registration was terminated. The 

current waiver program for FSAWP participants 

would not be available to new participants upon 

implementation of the proposed rule change. See 

proposed General 4, Rule 1210.09. However, 

individuals who are FSAWP participants 

immediately prior to the implementation date of the 

proposed rule change could elect to continue in that 

waiver program until the program has been retired. 

As noted above, FSAWP participants may 

participate for up to seven years in that waiver 

program, subject to specified conditions. See supra 

note 7. As discussed above, the proposed rule 

change provides a five-year participation period for 

participants in the proposed continuing education 

program. So as not to disadvantage FSAWP 

participants, the Exchange has determined to 

preserve that waiver program for individuals who 

are participating in the FSAWP immediately prior 

to the implementation date of the proposed rule 

change. Because the proposed rule change 

transitions the Regulatory Element to an annual 

cycle, FSAWP participants who remain in that 

waiver program following the implementation of 

the proposed rule change would be subject to an 

annual Regulatory Element requirement. See 

proposed General 4, Rule 1240(a)(1). Finally, the 

proposed rule change preserves the Exchange’s 

ability to extend the time by which FSAWP 

participants must complete the Regulatory Element 

for good cause shown. See proposed General 4, Rule 

1240(a)(2). 

44See proposed Supplementary Material .02 to 

General 4, Rule 1240. 

45See The Female Face of Family Caregiving 

(November 2018), available at https://www.national

partnership.org/our-work/resources/economicjustice/female-face-family-caregiving.pdf. 

46See The COVID–19 Recession is the Most 

Unequal in Modern U.S. History (September 30, 

2020), available at https://www.washington

post.com/graphics/2020/business/coronavirusrecession-equality/ and Unemployment’s Toll on 

Older Workers Is Worst in Half a Century (October 

21, 2020), available at https://www.aarp.org/work/ 

working-at-50-plus/info-2020/pandemicunemployment-older-workers. 

47See supra note 3. As described in more detail 

in the FINRA Rule Change, FINRA will work with 

the CE Council to develop and incorporate 

additional resources in connection with the 

Regulatory and Firm Elements. Similar to FINRA, 

these additional enhancements do not require any 

changes to the Exchange rules. 

48See FINRA Regulatory Notice 21–41 at https:// 

www.finra.org/rules-guidance/notices/21-41. 

• individuals would have a maximum 

of five years in which to reregister; 40

• individuals who have been CE 

inactive for two consecutive years, or 

who become CE inactive for two 

consecutive years during their 

participation, would not be eligible to 

participate or continue; 41 and 

• individuals who are subject to a 

statutory disqualification, or who 

become subject to a statutory 

disqualification following the 

termination of their registration or 

during their participation, would not be 

eligible to participate or continue.42

The proposed rule change also 

includes a look-back provision that 

would, subject to specified conditions, 

extend the proposed option to 

individuals who have been registered as 

a representative or principal within two 

years immediately prior to the 

implementation date of the proposed 

rule change and individuals who have 

been FSAWP participants immediately 

prior to the implementation date of the 

proposed rule change.43

In addition, the proposed rule change 

includes a re-eligibility provision that 

would allow individuals to regain 

eligibility to participate each time they 

reregister with a firm for a period of at 

least one year and subsequently 

terminate their registration, provided 

that they satisfy the other participation 

conditions and limitations.44 Finally, 

the Exchange proposes making 

conforming amendments to General 4, 

Rule 1210, including adding references 

to proposed Rule 1240(c) under General 

4, Rule 1210.08. 

The proposed rule change will have 

several important benefits. It will 

provide individuals with flexibility to 

address life and career events and 

necessary absences from registered 

functions without having to requalify 

each time. It will also incentivize them 

to stay current on their respective 

securities industry knowledge following 

the termination of any of their 

registrations. The continuing education 

under the proposed option will be as 

rigorous as the continuing education of 

registered persons, which promotes 

investor protection. Further, the 

proposed rule change will enhance 

diversity and inclusion in the securities 

industry by attracting and retaining a 

broader and diverse group of 

professionals. 

Significantly, the proposed rule 

change will be of particular value to 

women, who continue to be the primary 

caregivers for children and aging family 

members and, as a result, are likely to 

be absent from the industry for longer 

periods.45 In addition, the proposed rule 

change will provide longer-term relief 

for women, individuals with low 

incomes and other populations, 

including older workers, who are at a 

higher risk of a job loss during certain 

economic downturns and who are likely 

to remain unemployed for longer 

periods.46

d. CE Program Implementation 

As stated in the FINRA Rule Change, 

FINRA and the CE Council also plan to 

enhance the CE Program in other ways, 

and these additional enhancements do 

not require any changes to the FINRA 

rules.47 As it relates to the rule changes 

themselves, the changes relating to the 

Maintaining Qualifications Program 

(paragraph (c) of General 4, Rule 1240) 

and the Financial Services Affiliate 

Waiver Program (FSAWP) 

(Supplementary Material .09 to General 

4, Rule 1210) will become effective 

March 15, 2022. All other changes 

related to the FINRA Rule Change, 

including the changes relating to the 

Regulatory Element, Firm Element and 

the two-year qualification period, will 

become effective January 1, 2023.48

Manual Signature 

General 4, Rule 1250(c) currently 

provides that every initial and transfer 

electronic Form U4 filing and any 

amendments to the disclosure 

information on Form U4 must be based 

on a manually signed Form U4 provided 

to the member or applicant for 

membership by the person on whose 

behalf the Form U4 is being filed, 

consistent with FINRA Rule 1010(c). 

Similarly, the Exchange’s 

Supplementary Material .03 currently 


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49See Securities Exchange Release No. 91262 

(March 5, 2021), 86 FR 13935 (March 11, 2021) (SR– 

FINRA–2021–003). 

50See Securities Exchange Release No. 92562 

(August 4, 2021), 86 FR 143701 (August 10, 2021) 

(SR–CBOE–2021–043). 

51See accord Securities Exchange Act Release 

No. 85282 (March 11, 2019), 84 FR 9573 (March 15, 

2019) (Order Approving File No. SR–FINRA–2018– 

040) (discussing valid electronic signatures under 

existing guidance). 

52 15 U.S.C. 78f(b). 

53 15 U.S.C. 78f(b)(5). 54See supra notes 3 and 4. 

provides that in the event a member is 

not able to obtain an associated person’s 

manual signature or written 

acknowledgement of amended 

disclosure information on that person’s 

Form U4 prior to filing of such 

amendment reflecting the information 

pursuant to Rule 1250(c)(3), the member 

must enter ‘‘Representative Refused to 

Sign/Acknowledge’’ or ‘‘Representative 

Not Available’’ or a substantially similar 

entry in the electronic Form U4 field for 

the associated person’s signature. 

However, FINRA has since amended 

their Rule 1010(c) to permit firms to 

choose to rely on electronic signatures 

to satisfy the signature requirements 

when filing Form U4.49 Cboe Exchange, 

Inc. (‘‘CBOE’’) has also updated its Rule 

3.34 to reflect FINRA’s updated Rule 

1010(c).50

The Exchange proposes to amend 

Rule 1250(c) and Supplementary 

Material .03 to similarly allow firms to 

rely on electronic signatures when filing 

Form U4, consistent with FINRA Rule 

1010(c). Specifically, the Exchange 

proposes to remove the term ‘‘manual’’ 

from ‘‘manual signature’’ and the term 

‘‘manually’’ from ‘‘manually signed.’’ 

The proposed rule change provides 

members, and applicants for 

membership, with an opportunity to 

better manage operational challenges. 

Particularly, the COVID–19 pandemic 

amplified the need to better manage 

operational challenges like those that 

arose during the pandemic and that may 

continue to arise in the future. 

Additionally, the proposed rule change 

would not require the use of a particular 

type of technology to obtain a valid 

electronic signature from the associated 

person. The Exchange believes that 

some firms may be unable to obtain the 

manual signature of applicants for 

registration resulting in a significant 

operational backlog. By permitting these 

firms to rely on electronic signatures to 

satisfy the signature requirements of 

Exchange Rule 1250 and Supplementary 

Material .03, the proposed rule change 

may reduce or eliminate this backlog. 

For purposes of the proposed rule 

change, a valid electronic signature 

would be any electronic mark that 

clearly identifies the signatory and is 

otherwise in compliance with the 

Electronic Signatures in Global and 

National Commerce Act (‘‘E-Sign Act’’) 

and the guidance issued by the SEC 

relating to the E-Sign Act.51

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,52 in general, and furthers the 

objectives of Section 6(b)(5) of the Act,53

in particular, in that it is designed to 

promote just and equitable principles of 

trade, to remove impediments to and 

perfect the mechanism of a free and 

open market and a national market 

system, and, in general to protect 

investors and the public interest. 

The Exchange believes that the 

proposed changes to the Regulatory 

Element and Firm Element will ensure 

that all registered persons receive timely 

and relevant training, which will, in 

turn, enhance compliance and investor 

protection. Further, the Exchange 

believes that establishing a path for 

individuals to maintain their 

qualification following the termination 

of a registration will reduce unnecessary 

impediments to requalification and 

promote greater diversity and inclusion 

in the securities industry without 

diminishing investor protection. 

As it relates to the proposed changes 

to General 4, Rule 1250(c), the Exchange 

believes the proposed rule change 

provides firms with the flexibility to 

rely on electronic signatures to satisfy 

the signature requirements of Rule 

1250(c). Specifically, the Exchange 

proposes to amend Exchange Rule 

1250(c) and Supplementary Material 

.03, similar to the amendments made by 

FINRA and CBOE, to provide the option 

of filing an initial or a transfer Form U4 

based on a manually or an electronically 

signed copy of the form provided to the 

member, or applicant for membership, 

by the individual on whose behalf the 

form is being filed. Considering the 

technological advancements that 

provide for enhanced authentication 

and security of electronic signatures, the 

Exchange believes that it is appropriate 

to amend Rule 1250(c) and 

Supplementary Material .03 to provide 

such flexibility. The proposed rule 

change also addresses the ongoing 

public health risks stemming from the 

outbreak of COVID–19 and the 

operational challenges that firms 

continue to face as a result of pandemic 

repercussions. By permitting these firms 

to rely on electronic signatures to satisfy 

the signature requirements of Rule 

1250(c) and Supplementary Material 

.03, the proposed rule change may 

reduce or eliminate an operational 

backlog due to the difficulty firms may 

have faced in obtaining the manual 

signature of applicants for registration 

as a result of the impact of the pandemic 

on daily work environments. 

The Exchange believes the proposal is 

consistent with the Act for the reasons 

described above and for the reasons 

outlined in the approval order for SR– 

FINRA–2021–015 and as noticed in SR– 

FINRA–2021–003.54

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the Act. All members 

would be subject to the proposed rule 

change. The proposed rule change 

relating to the Exchange’s CE Program, 

which is materially identical to the 

FINRA Rule Change, is designed to 

result in a more efficient CE Program 

that addresses relevant regulatory 

requirements and provides individuals 

with improved tools and resources to 

understand and comply with such 

requirements, enhancing investor 

protection. Moreover, the proposed rule 

change would provide new channels for 

individuals to maintain their 

qualification status for a terminated 

registration category and, in so doing, 

could increase the likelihood that 

professionals who need to step away 

from the industry for a period could 

return, subject to satisfying all other 

requirements relating to the registration 

process. 

As it relates to the proposed 

amendments to General 4, Rule 1250, 

the proposed rule change relating to 

manual signatures is, in all material 

respects, substantively identical to 

recent rule changes adopted by FINRA 

and CBOE. The Exchange believes the 

proposed change will reduce a 

regulatory filing burden for members by 

allowing them to rely on Form U4 

copies with an electronic signature. All 

members will have the option to rely on 

such forms with an electronic signature 

(or continue to rely on forms with a 

manual signature). 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or received. 


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55 15 U.S.C. 78s(b)(3)(A)(iii). 56 17 CFR 240.19b–4(f)(6). 57 17 CFR 240.19b–4(f)(6)(iii). 

58For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposed rule change’s impact on efficiency, 

competition, and capital formation. See 15 U.S.C. 

78c(f). 

59 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change does not: (i) Significantly affect 

the protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) become 

operative for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A) of the Act 55 and Rule 19b– 

4(f)(6) thereunder.56

A proposed rule change filed under 

Rule 19b–4(f)(6) normally does not 

become operative for 30 days after the 

date of filing. However, pursuant to 

Rule 19b–4(f)(6)(iii), the Commission 

may designate a shorter time if such 

action is consistent with the protection 

of investors and the public interest. The 

Exchange has asked the Commission to 

waive the 30-day operative delay so that 

this proposed rule change may become 

operative immediately upon filing. Rule 

19b–4(f)(6)(iii) 57 requires a selfregulatory organization to give the 

Commission written notice of its intent 

to file a proposed rule change under that 

subsection at least five business days 

prior to the date of filing, or such 

shorter time as designated by the 

Commission. The Exchange has 

provided such notice. 

Waiver of the 30-day operative delay 

would allow the Exchange to implement 

proposed changes to the Maintaining 

Qualifications Program and the FSAWP 

by March 15, 2022 to coincide with 

FINRA’s announced implementation 

date, thereby eliminating the possibility 

of a significant regulatory gap between 

the FINRA and Nasdaq rules and 

providing more uniform standards 

across the securities industry. For the 

proposal related to the manual signature 

requirement, waiver of the 30-day 

operative delay would provide 

immediate relief to firms currently 

experiencing a significant operational 

backlog because of the requirement to 

obtain manual signatures, ultimately 

benefitting the investing public. The 

proposed rule change to Rule 1250(c) 

and Supplementary Material .03 will 

provide immediate relief to these firms 

by allowing them to rely on electronic 

signatures to clear the backlog. 

Moreover, as noted above, the proposed 

manual signature rule change is based 

on a similar rule change by FINRA that 

has already taken effect. For these 

reasons, the Commission believes that 

waiver of the 30-day operative delay for 

this proposal is consistent with the 

protection of investors and the public 

interest. Accordingly, the Commission 

hereby waives the 30-day operative 

delay and designates the proposal 

operative upon filing.58

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 (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

NASDAQ–2022–021 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–NASDAQ–2022–021. 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 (http://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 

10:00 a.m. and 3:00 p.m. Copies of such 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–NASDAQ–2022–021 and 

should be submitted on or before April 

7, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.59

Eduardo Aleman, 

Assistant Secretary. 

[FR Doc. 2022–05597 Filed 3–16–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94405; File No. SR– 

CboeEDGX–2022–008] 

Self-Regulatory Organizations; Cboe 

EDGX Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change To Modify the 

External Subscriber Fees Applicable 

To Cboe One Summary Derived Data 

API Service 

March 11, 2022. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on March 1, 

2022, Cboe EDGX Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘EDGX’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the Exchange. 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 

Cboe EDGX Exchange, Inc. (‘‘EDGX’’ 

or the ‘‘Exchange’’) is filing with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) a proposed rule 

change to modify the External 


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