22264 Federal Register / Vol. 87, No. 72 / Thursday, April 14, 2022 / Notices 

9 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 88917 

(May 20, 2020), 85 FR 31832 (May 27, 2020) (Notice 

of Filing and Immediate Effectiveness of File No. 

SR–FINRA–2020–015); Securities Exchange Act 

Release No. 89055 (June 12, 2020), 85 FR 36928 

(June 18, 2020) (Notice of Filing and Immediate 

Effectiveness of File No. SR–FINRA–2020–017); 

Securities Exchange Act Release No. 89423 (July 29, 

2020), 85 FR 47278 (August 4, 2020) (Notice of 

Filing and Immediate Effectiveness of File No. SR– 

FINRA–2020–022); Securities Exchange Act Release 

No. 90619 (December 9, 2020), 85 FR 81250 

(December 15, 2020) (Notice of Filing and 

Immediate Effectiveness of File No. SR–FINRA– 

2020–042); Securities Exchange Act Release No. 

91495 (April 7, 2021), 86 FR 19306 (April 13, 2021) 

(Notice of Filing and Immediate Effectiveness of 

File No. SR–FINRA–2021–006); Securities 

Exchange Act Release No. 93758 (December 13, 

2021), 86 FR 71695 (December 17, 2021) (Notice of 

Filing and Immediate Effectiveness of File No. SR– 

FINRA–2021–031); Securities Exchange Act Release 

No. 94430 (March 16, 2022), 87 FR 16262 (March 

22, 2022) (Notice of Filing and Immediate 

Effectiveness of File No. SR–FINRA–2022–004). 

4The filings to establish and extend the 

temporary amendments involving electronic service 

and filing also included additional temporary 

amendments to provide extensions of time to 

FINRA staff, respondents and other parties in 

connection with certain adjudicatory and review 

processes. See Securities Exchange Act Release No. 

88917 (May 20, 2020), 85 FR 31832 (May 27, 2020) 

(Notice of Filing and Immediate Effectiveness of 

File No. SR–FINRA–2020–015). For example, under 

original Rule 6490(e), the time to appeal was seven 

calendar days, and a subcommittee was required to 

convene once each calendar month to consider all 

appeals received during the prior month. Under the 

temporary amendments to Rule 6490(e), the time to 

appeal was extended to 30 calendar days, and the 

time for the subcommittee to convene was extended 

to once every 90 days. The time frames under the 

proposed rule change are reverting back to their 

original form, so the timing requirements under the 

proposed rule change are the same as they were 

under the original rule. 

5See 85 FR 31832, supra note 3. 

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– 

MEMX–2022–07 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–MEMX–2022–07. 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–MEMX–2022–07 and 

should be submitted on or before May 

5, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.9

Jill M. Peterson, 

Assistant Secretary. 

[FR Doc. 2022–07953 Filed 4–13–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94654; File No. SR–FINRA– 

2022–009] 

Self-Regulatory Organizations; 

Financial Industry Regulatory 

Authority, Inc.; Notice of Filing of a 

Proposed Rule Change To Amend 

Certain FINRA Rules To Permit, and in 

Some Instances Require, Electronic 

Service and Filing of Documents in 

Disciplinary and Other Proceedings 

and Appeals 

April 8, 2022. 

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

Securities Exchange Act of 1934 (‘‘Act’’ 

or ‘‘Exchange Act’’) 1 and Rule 19b–4 

thereunder,2 notice is hereby given that 

on April 6, 2022, the Financial Industry 

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

filed with the Securities and Exchange 

Commission (‘‘SEC’’ or ‘‘Commission’’) 

the proposed rule change as described 

in Items I, II, and III below, which Items 

have been prepared by FINRA. 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 

FINRA is proposing to amend FINRA 

Rules 1012, 1015, 6490, 9132, 9133, 

9135, 9146, 9321, 9341, 9349, 9351, 

9522, 9524, 9525, 9559 and 9630 to 

permit, and in some instances require, 

electronic service and filing of 

documents in disciplinary and other 

proceedings and appeals. 

The text of the proposed rule change 

is available on FINRA’s website at 

http://www.finra.org, at the principal 

office of FINRA 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, 

FINRA 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. FINRA has prepared 

summaries, set forth in sections A, B, 

and C below, of the most significant 

aspects of such statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

Several of FINRA’s rules regarding 

method of service and filing have been 

amended temporarily to permit, and in 

some instances require, electronic filing 

and service during the period in which 

FINRA’s operations have been impacted 

by the COVID–19 pandemic.3 These 

temporary amendments pertain to 

disciplinary proceedings before the 

Office of Hearing Officers (OHO), and to 

appeals before the National 

Adjudicatory Council (NAC), among 

other types of administrative 

proceedings.4 However, the temporary 

amendments do not permit electronic 

service of an initial complaint on a 

respondent. FINRA did not temporarily 

change the method of serving the initial 

complaint due to heightened fair 

process concerns.5 Likewise, the 

proposed rule change would not change 

how initial complaints are served. The 

only permissible methods of serving the 


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6See FINRA Rule 9134(a). 

7For ease of reference in this filing, FINRA refers 

to the pre-pandemic rules as ‘‘original rules’’ and 

to the temporary changes to the original rules as 

‘‘temporary amendments.’’ Some of the original 

rules were amended while the temporary 

amendments were in effect. Those amendments to 

the original rules have been incorporated into the 

temporary amendments. See, e.g., FINRA Rule 9321 

(amended by SR–FINRA–2020–011, eff. April 15, 

2021). 

8See Amendments to the Commission’s Rules of 

Practice, Securities Exchange Act Release No. 90442 

(November 17, 2020), 85 FR 86464 (File No. S7–18– 

15) (December 30, 2020) (codified at 17 CFR 201 

(2020)). 

9See supra note 3. 

10See FINRA Rules 6490(e), 9133(b), 9146(l), 

9524(a)(3) and 9559(h). 

11Prior to the temporary amendments, FINRA 

permitted service by email under some of its 

original rules. For example, FINRA Rule 6490(d)(5) 

(Processing of Company-Related Actions; 

Procedures for Reviewing Submissions; Notice 

Issuance) permits a notice under that provision to 

be issued by facsimile or email, or pursuant to Rule 

9134. Rule 9134 does not permit service by email, 

however. 

12FINRA sometimes serves documents in its 

capacity as the Adjudicator. In other instances, 

FINRA is a party, for example, in its capacity as the 

Department of Enforcement. 

13As indicated in the proposed rule text, FINRA 

will consider service by email complete upon 

sending of the relevant document or other 

information. This is consistent with service by mail 

under the original rules and service by email under 

the temporary amendments. 

14When the Department of Enforcement files an 

initial complaint on a respondent, the Notice of 

Complaint tells the respondent how to file the 

answer and other documents with OHO. In 

addition, once OHO receives an initial complaint, 

it sends a Code and Guide letter to each respondent 

to notify them of the complaint. That letter also 

includes instructions on how to file with OHO. 

15FINRA Rule 1012(a) (General Provisions; Filing 

by Applicant or Service by FINRA) governs the 

filing and service requirements for the Rule 1000 

Series. 

16FINRA Rule 1015(f) (Review by National 

Adjudicatory Council; Hearing). 

17 In an effort to streamline processes and avoid 

duplication, FINRA is also proposing to amend 

Rule 1015(a) to eliminate the requirement that the 

applicant simultaneously file by first-class mail a 

copy of the request for review pursuant to Rule 

1015(a) to the district office where the applicant 

filed its application. 

initial complaint are by hand, mail or 

courier.6

FINRA is proposing to make the 

temporary amendments regarding 

electronic service and filing permanent, 

with some modifications. FINRA 

believes that advances in technology 

and its availability have made filing and 

service more efficient under the 

temporary amendments than under the 

original rules.7 In addition, FINRA 

believes that operating under the 

temporary amendments since May 2020 

has demonstrated that electronic service 

and filing is beneficial for parties, 

panelists and FINRA staff. FINRA 

further notes that the SEC also amended 

its rules in November 2020 to require 

electronic filing and service of 

documents in its administrative 

proceedings.8 FINRA further believes 

that the proposed rule change will 

similarly improve and modernize 

FINRA’s operations. 

Background 

The FINRA Rule 1000, 6400, 9100, 

9300, 9520, 9550 and 9600 Series 

contain filing, service and other 

procedural requirements. The temporary 

amendments to these rules allowed, and 

in some instances required, FINRA (in 

its capacity as an Adjudicator) to serve 

certain documents on parties by 

electronic mail (‘‘email’’) and required 

parties to file or serve documents by 

email, unless the parties agreed to an 

alternative method of service.9

The proposed rule change includes 

provisions to allow, and in some 

instances require, FINRA to serve 

certain documents on parties by email 

and require parties to file or serve 

documents by email, unless another 

method of service is ordered by the 

Adjudicator. Several of the proposed 

rule changes differ from the temporary 

amendments, which required email 

service unless the parties agreed to an 

alternative method.10 FINRA has 

observed that a more effective approach 

would be to require email service unless 

the Adjudicator orders otherwise. As 

discussed further below, the proposal 

will allow all parties who lack the 

ability to use or access email to request 

relief to use an alternative method of 

service upon a showing of good cause. 

But unlike the temporary amendments, 

the parties’ agreement to use an 

alternative method of service would be 

insufficient unless the parties also 

obtained an order from the Adjudicator 

permitting use of the alternative method 

of service. 

In addition, to support the transition 

to email service and filing, FINRA 

proposes to require parties in OHO 

proceedings to file and serve all parties 

with their current email address and 

contact information at the time of their 

first appearance, and to file and serve 

any change in email address or contact 

information during the course of the 

proceeding. 

Proposed Rule Change To Allow or 

Require Email Filing and Service 

FINRA rules, with few exceptions, do 

not provide for service by email.11 The 

proposed rule change would permit 

FINRA to serve documents other than 

the initial complaint by email among 

various other methods of service, such 

as personal service, mail and courier, 

and to provide that service by email is 

deemed complete upon sending.12

FINRA has elected email service 

whenever possible while the temporary 

amendments have been in effect, and it 

is FINRA’s intention to continue to do 

so under the proposed rule change. If 

FINRA has knowledge that the address 

used for service is not current or not 

functional (i.e., FINRA receives a 

bounce back or other message indicating 

that there was a failure to deliver the 

email), FINRA will use other 

permissible methods of service until it 

can verify the party’s email address.13

FINRA notes that, in most cases, FINRA 

and the relevant party, or their counsel, 

will have already engaged in 

communications prior to the service of 

documents or other information. 

Accordingly, in most cases, FINRA will 

already have information regarding the 

relevant party, or their counsel’s, 

preferred method of service. 

Further, to the extent an applicant, 

respondent or other party lacks the 

ability to use or access technology 

needed to file, serve or accept service by 

email, FINRA intends to provide 

reasonable accommodations to them. 

The process for requesting an alternative 

method of service or filing will be 

posted to FINRA’s website, as well as 

explained in the Notice of Complaint 

and in the Code and Guide letter.14 If a 

party shows good cause, the Adjudicator 

will order that filing or service occur by 

hard copy. 

The proposed rule change to amend 

the FINRA Rule 1000, 6400, 9100, 9300, 

9520, 9550 and 9600 Series is 

substantially the same as the temporary 

amendments currently in effect unless 

otherwise noted, below. 

The FINRA Rule 1000 Series (Member 

Application and Associated Person 

Registration) governs, among other 

things, the process for (i) applying for 

FINRA membership; (ii) FINRA 

members to seek approval of a change 

in ownership, control or business 

operations, and (iii) an applicant to 

request that FINRA’s appellate body, the 

NAC, review a FINRA decision rendered 

under the Rule 1000 Series. In 

connection with these processes, 

applicants and FINRA are required to 

file or serve certain documents using the 

prescribed methods set forth in FINRA 

Rule 1012(a), which do not include 

email.15 FINRA proposes to 

permanently amend Rule 1012(a)(4) to 

permit FINRA to serve documents under 

the Rule 1000 Series by email and to 

amend Rule 1015(f)(1),16 which requires 

the NAC to serve a notice of a hearing 

before the NAC by facsimile or 

overnight courier, to allow service of the 

notice by email.17 The proposed rule 


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18FINRA is also proposing a non-substantive 

change to delete the word ‘‘electronic’’ from the 

description of the ‘‘alternative filing process’’ 

because it is superfluous. 

19FINRA Rule 6490(e) (Processing of CompanyRelated Actions; Request for an Appeal to 

Subcommittee of Uniform Practice Code 

Committee). 

20FINRA is also proposing several nonsubstantive, technical changes including, for 

example, deleting the parenthetical references to 

the numerals ‘‘3’’ and ‘‘7,’’ which originally 

followed those words in FINRA Rule 6490(e). As 

noted supra note 4, the time frames under the 

proposed rule change are reverting back to their 

original form, so the time to appeal and for 

appellate review under the proposed rule change 

are the same as they were under the original rule. 

21FINRA Rule 9132(b) (Service of Orders, 

Notices, and Decisions by Adjudicator; How 

Served). 

22FINRA Rule 9133(b) (Service of Papers Other 

Than Complaints, Orders, Notices or Decisions; 

How Served). 

23FINRA Rule 9146(l) (Motions; General). 

24FINRA Rule 9321 (Transmission of Record). 

25FINRA Rule 9341(c) (Oral Argument; Notice 

Regarding Oral Argument). 

26FINRA Rule 9349(c) (National Adjudicatory 

Council Formal Consideration; Decision; Issuance 

of Decision After Expiration of Call for Review 

Period). 

27FINRA Rule 9351(e) (Discretionary Review by 

FINRA Board; Issuance of Decision After Expiration 

of Call for Review Period). 

28FINRA Rule 9522(a)(4) (Initiation of Eligibility 

Proceeding; Member Regulation Consideration; 

Service). 

29FINRA Rule 9524(a)(3)(A) and (B) (National 

Adjudicatory Council Consideration; Transmission 

of Documents). 

30FINRA Rule 9524(b)(3) (National Adjudicatory 

Council Consideration; Issuance of Decision After 

Expiration of Call for Review Period). 

31FINRA Rule 9525(e) (Discretionary Review by 

the FINRA Board; Issuance of Decision). 

32FINRA is also proposing a non-substantive, 

technical change to replace the numeral ‘‘10’’ with 

the word ‘‘ten’’ in Rule 9524(a)(3)(B). 

33FINRA Rule 9559(h) (Hearing Procedures for 

Expedited Proceedings Under the Rule 9550 Series; 

Transmission of Documents). Rule 9559(h) 

currently permits email as a method of service. 

34As with the proposed rule change to amend 

Rule 1015(a) noted supra note 17, FINRA proposes 

to amend Rule 9559(h) to also eliminate the 

requirements in Rule 9559(h)(1) and (2) that, if the 

specified documents are served by facsimile or 

email, they must also be served by either overnight 

courier or personal delivery. 

35FINRA Rule 9559(q) (Hearing Procedures for 

Expedited Proceedings Under the Rule 9550 Series; 

Call for Review by the National Adjudicatory 

Council). 

36FINRA Rule 9630(e) (Procedures for 

Exemptions; Appeal; Decision). 

change would also amend Rule 

1012(a)(3) to require applicants to file 

an application or any document or 

information requested under the Rule 

1000 Series by email except where 

FINRA has otherwise prescribed an 

alternative filing process, while 

permitting the applicant to also file a 

requested document or information by 

another method if the Department and 

the Applicant agree.18

FINRA Rule 6490 codifies the 

requirements in Exchange Act Rule 

10b–17 for issuers of a class of publicly 

traded securities to provide timely 

notice to FINRA of certain corporate 

actions (e.g., dividend or other 

distribution of cash or securities, stock 

split or reverse split, rights or 

subscription offering). FINRA reviews 

related documentation and, under 

certain circumstances, the 

documentation may not be processed if 

it is deemed deficient. Rule 6490(e) sets 

forth the process for appealing such a 

determination.19 The proposed rule 

change would require the requesting 

party to file an appeal by email unless 

an alternative method of service is 

ordered by the Adjudicator.20

The FINRA Rule 9000 Series, among 

other things, sets forth the procedure for 

FINRA proceedings for disciplining a 

member, associated person or formerly 

associated person. The Rule 9100 Series 

is of general applicability to all 

proceedings set forth in the Rule 9000 

Series, unless a rule specifically 

provides otherwise. Rules 9132(b),21

9133(b),22 and 9146(l) 23 provide that 

the documents and other information 

governed by those rules be served 

pursuant to Rule 9134, which permits 

service on the parties using the 

following methods: (1) Personal service, 

(2) mail, or (3) courier. Rule 9134 does 

not permit service by email. The 

proposed rule change would amend 

Rule 9132(b) to allow FINRA to serve 

the relevant documents or information 

by email, and Rules 9133(b) and 9146(l) 

to require parties to serve documents by 

email, unless an alternative method of 

service is ordered by the Adjudicator. 

In addition, to support the transition 

to email service and filing, FINRA 

proposes to amend Rule 9135 to add 

paragraph (d), which would require 

parties in OHO proceedings to file and 

serve the parties with their current 

email address and contact information 

at the time of their first appearance, and 

to file and serve any change in email 

address or contact information during 

the course of the proceeding. Based on 

the experience of operating under the 

temporary amendments, FINRA believes 

this proposed rule change, which was 

not part of the temporary amendments, 

will help ensure that documents are 

successfully sent from and received at a 

valid email address. It will also ensure 

that all participants, including FINRA, 

applicants, respondents and any other 

parties, have accurate contact 

information for all parties. 

The FINRA Rule 9300 Series sets forth 

the procedures for review of 

disciplinary proceedings by the NAC 

and FINRA Board and for applications 

for SEC review. FINRA Rules 9321,24

9341(c),25 9349(c),26 and 9351(e) 27

require FINRA to serve documents in 

connection with those proceedings. 

Service under those rules is governed by 

Rule 9134, which does not permit email 

as a method of service. FINRA proposes 

to permanently amend Rules 9321, 

9341(c), 9349(c), and 9351(e) to allow 

for email as a method of service. 

The FINRA Rule 9520 Series sets forth 

the procedures for eligibility 

proceedings and review of those 

proceedings by the NAC and FINRA 

Board. Rules 9522(a)(4),28 9524(a)(3)(A) 

and (B),29 9524(b)(3),30 and 9525(e) 31

require FINRA to serve documents in 

connection with those proceedings, but 

do not allow for email as a method of 

service. The proposed rule change 

would permanently amend those rules 

to allow for email as a method of 

service. Further, under the proposed 

change to Rule 9524(a)(3)(A) and (B), 

the disqualified member or sponsoring 

member would be required to serve 

documents and the exhibit and witness 

lists by email unless an alternative 

method of service is ordered by the 

Adjudicator.32

The FINRA Rule 9550 Series sets forth 

the procedures for expedited 

proceedings and the ability of the NAC 

to call for review a proposed decision 

prepared under the Rule 9550 Series. 

Rule 9559(h)(2) 33 sets forth the timing 

and method of service requirements for 

the parties’ exchange of proposed 

exhibit and witness lists in advance of 

an expedited proceeding.34 Rule 

9559(q)(2) 35 requires the NAC to serve 

its decision when it issues one and Rule 

9559(q)(5) requires the NAC to serve the 

decision on the parties and all members 

with which the respondent is 

associated. Rule 9559(q)(2) and (5) do 

not allow for email as a method of 

service. FINRA proposes to permanently 

amend Rule 9559(h)(2) to require FINRA 

to serve its exhibit and witness lists by 

email, unless an alternative method of 

service is ordered by the Adjudicator. 

The proposed rule change would amend 

Rule 9559(q)(2) and (5) to allow for 

email as a method of service. 

The FINRA Rule 9600 Series sets forth 

the procedures for members to seek 

exemptive relief from a variety of 

FINRA rules. Rule 9630(e)(1) and (2) 36

require the NAC to serve its decision 

pursuant to Rule 9134, which does not 

allow for email as a method of service. 

The proposed rule change would amend 

Rule 9630(e) to allow for email as a 

method of service. 

As discussed in detail in Item 3(b), 

FINRA believes the proposal will 

modernize the rules and make service 


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37See supra note 8. 

38FINRA intends to minimize any gap between 

the expiration of the temporary amendments on 

electronic service and filing and the 

implementation date of this proposed rule change. 

39 15 U.S.C. 78o–3(b)(6). 

40 15 U.S.C. 78o–3(b)(8). 41See supra note 3. 

42The proposal also amends filing and service 

requirements for eligibility proceedings under 

FINRA Rule 9522(a)(4) and for appeals of 

determinations regarding the documentation of 

certain corporate actions under FINRA Rule 

6490(e). There were 22 eligibility proceedings in 

2018 and 14 in 2019; there have been no appeals 

of determinations under Rule 6490(e) since the 

temporary requirements came into effect in May 

2020. 

and filing more efficient and effective. 

Email technology is widely available, 

and use of electronic methods of service 

and filing is common practice in the 

courts and other regulatory agencies, 

including the SEC.37 At the same time, 

the proposal provides for alternative 

methods of service for parties who lack 

the ability to use or access technology 

needed to send or receive documents 

electronically. 

FINRA will announce the effective 

date of the proposed rule change in a 

Regulatory Notice.38

2. Statutory Basis 

FINRA believes that the proposed rule 

change is consistent with the provisions 

of Section 15A(b)(6) of the Act,39 which 

requires, among other things, that 

FINRA rules must be designed to 

prevent fraudulent and manipulative 

acts and practices, to promote just and 

equitable principles of trade, and, in 

general, to protect investors and the 

public interest. FINRA believes that the 

proposed rule change is also consistent 

with Section 15A(b)(8) of the Act,40

which requires, among other things, that 

FINRA rules provide a fair procedure for 

the disciplining of members and 

persons associated with members. 

FINRA believes that the proposed rule 

change protects investors and the public 

interest by requiring use of broadly 

available technology to make service 

and filing processes more efficient and 

effective. FINRA’s disciplinary and 

eligibility proceedings and other review 

processes serve a critical role in 

providing investor protection and 

maintaining fair and orderly markets by, 

for example, sanctioning misconduct 

and preventing further customer harm 

by members and associated persons. 

The proposed rule change promotes 

efficiency in these processes by 

permitting electronic service and filing 

in most instances. To ensure that 

documents are effectively sent and 

received, FINRA is proposing to require 

parties to provide and update their 

contact information, including their 

email address, during the course of a 

proceeding. These amendments reduce 

the reliance on paper documents in 

favor of more efficient electronic 

formats. FINRA believes adopting 

permanent rules on electronic service 

and filing is especially important as 

hybrid and remote work become more 

common. 

At the same time, the proposed rule 

change includes safeguards to ensure 

fairness. For example, there are 

procedures in place for persons who 

lack the ability to use or access 

technology necessary to send or receive 

documents electronically. Such parties 

will have the ability to request relief 

from the Adjudicator to file or serve 

documents by another method. Based 

on FINRA’s experience of operating 

under the temporary amendments, 

which have permitted electronic service 

and filing since mid-2020, FINRA 

anticipates that requests to use nonelectronic methods of service will be 

rare. In addition, the proposed rule 

change balances the interests of fairness 

and efficiency. As discussed, service of 

the initial complaint will continue to 

occur by hand, mail or courier, rather 

than by electronic means, thus ensuring 

there is satisfactory notice and fair 

process. 

Thus, the proposed rule change 

represents a significant step toward 

modernizing the service and filing 

processes in a manner that will protect 

investors and the public interest by 

promoting efficiency while preserving 

fair process. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

FINRA does not believe that the 

proposed rule change will result in any 

burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

Economic Impact Assessment 

FINRA has undertaken an economic 

impact assessment, as set forth below, to 

analyze the regulatory need for the 

proposed rule change, its potential 

economic impacts, including 

anticipated costs, benefits, and 

distributional and competitive effects, 

relative to the current baseline, and the 

alternatives FINRA considered in 

assessing how best to meet FINRA’s 

regulatory objectives. 

Regulatory Need 

Several of FINRA’s rules regarding 

method of service and filing have been 

amended temporarily to permit, and in 

some circumstances require, electronic 

filing and service during the period in 

which FINRA’s operations have been 

impacted by the COVID–19 pandemic.41

As stated earlier, the proposed rule 

change is intended to make these 

temporary amendments permanent 

considering the positive experience of 

operating while the temporary 

amendments have been in effect. The 

implementation of those temporary 

amendments suggests that advances in 

technology and its availability have 

made filing and service more efficient 

under the temporary amendments than 

under the original rules. 

Economic Baseline 

The economic baseline for the 

proposed rule change consists of the 

original rules together with the 

experience gained by broker-dealers, 

their associated persons, and FINRA in 

complying with the temporary 

amendments to the original rules. As 

discussed above, FINRA Rules 1000, 

6400, 9100, 9300, 9520, 9550 and 9600 

Series set forth filing and service 

requirements pertaining to expedited 

and disciplinary proceedings before 

OHO and to appeals before the NAC, 

among other types of FINRA 

proceedings. These rules, with few 

exceptions, do not allow FINRA to use 

email or require others to use email to 

meet certain filing and service 

requirements. FINRA temporarily 

amended these rules to permit, and in 

some instances require, electronic filing 

and service. 

The proposed rule change is expected 

to affect parties to disciplinary 

proceedings before OHO and to appeals 

before the NAC. FINRA thus has 

collected information detailing the 

number of new cases filed in OHO and 

NAC proceedings and the number of 

respondents in association with these 

proceedings in the past three years. The 

numbers are presented below. Note that 

‘‘Registered Rep’’ includes both current 

and former registered representatives 

and the numbers of new OHO filings 

include both expedited and disciplinary 

proceedings before OHO. The numbers 

show that the majority of respondents in 

OHO filings and NAC appeals consist of 

current and former registered 

representatives.42


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43 It can be difficult to assess potential cost 

increases following the proposal to require service 

by email because FINRA does not know the extent 

to which parties agreed to service by email during 

the pre-pandemic period. 

44See supra note 8. 

45See supra note 8. The comments are available 

at https://www.sec.gov/comments/s7-19-15/ 

s71915.shtml. 

46For example, over the year 2020, there were 65 

OHO filings with registered representatives as the 

sole respondents. Among them, 21 OHO filings had 

former registered representatives as respondents. In 

addition, there were 27 and 26 OHO filings, 

respectively, with former registered representatives 

as respondents in year 2019 and 2018. 

2020 2019 2018 

OHO Filings ................................................................................................................................. 69 95 90 

OHO Respondents: Firms Only ................................................................................................... 2 7 9 

OHO Respondents: Registered Rep Only .................................................................................. 65 85 76 

OHO Respondents: Both Firms and Registered Rep ................................................................. 2 3 5 

NAC Appeals ............................................................................................................................... 13 17 22 

NAC Respondents: Firms Only ................................................................................................... 2 2 3 

NAC Respondents: Registered Rep Only ................................................................................... 9 11 15 

NAC Respondents: Both Firms and Registered Rep .................................................................. 2 4 4 

Economic Impacts 

The proposed rule change will 

directly impact current and former 

member firms and associated persons, 

including registered representatives. 

With limited exceptions, these 

individuals would be applicants, 

respondents, or other related parties to 

disciplinary proceedings before OHO 

and to appeals before the NAC. The 

proposed rule change will not directly 

impact the customers of those firms. 

Parties in relevant proceedings will 

benefit from savings on time and money 

on printing, shipping, and storage of 

paper documents as filing and serving 

paper copies will generally not be 

required following the proposed rule 

change. The proposed rule change 

would also improve the overall 

efficiency of FINRA’s operations in 

collecting, preserving, and distributing 

documents to parties in these 

proceedings relative to the original 

rules. Such benefits are anticipated to 

accrue to firms and individuals as well 

as to FINRA in its capacity as an 

adjudicator. In particular, FINRA 

believes that the benefits to member 

firms from the proposal will likely be 

larger for those using hybrid and remote 

work models or in situations where 

access to physical office locations is 

limited or restricted. 

The extent of the cost savings is likely 

not uniform across parties and cannot 

be estimated in aggregate for two 

reasons. First, FINRA does not know the 

frequencies of filing and service and the 

size of the documents in association 

with relevant proceedings. The expected 

cost savings will likely be greater for 

parties that file and serve large 

documents more frequently. Second, 

FINRA does not know how parties 

agreed to serve documents, by email, 

paper, or other alternative methods, 

during the pre-pandemic period. 

Certain parties may bear incremental 

burdens over pre-pandemic filing and 

service practices. FINRA does not know 

the extent to which, under the proposed 

rule change, certain parties will incur 

some costs to scan documents. 

Anecdotally, FINRA understands that 

this group is small. The proposals to 

have a valid email address and to 

require filing by email are not expected 

to impose significant new costs because 

anecdotal evidence suggests that this 

method of filing was already adopted by 

most parties to OHO and NAC 

proceedings before the pandemic.43

FINRA notes that OHO and the NAC 

have not received any complaints 

regarding the temporary amendments on 

method of service and filing during the 

pandemic. FINRA also notes that the 

SEC recently finalized a rule to require 

electronic filing and service of 

documents in SEC administrative 

proceedings.44 The Commission 

received only seven comments on the 

proposed rule and reported that 

commenters generally supported 

electronic filing.45

The proposal will likely impose a 

higher cost on parties who have limited 

access to the internet and to any 

hardware and software that may be 

involved in processing the documents. 

For example, it is unlikely that member 

firms or current registered 

representatives would face these 

challenges, but former registered 

representatives may. There have been a 

few such individuals in recent 

proceedings before OHO and the NAC.46

The proposal will allow reasonable 

accommodations for such individuals. 

Service of an initial complaint on a 

respondent would not be subject to the 

proposed rule change on electronic 

service and filing, mitigating any risk 

that a respondent would be unaware of 

the complaint. 

The overall benefits and costs of the 

proposal will depend on the expected 

volume of the relevant proceedings and 

the number of respondents associated 

with these proceedings. As described 

earlier, there have been only a limited 

number of new cases or appeals filed 

annually in OHO and NAC proceedings 

in the past three years. The majority of 

these cases or appeals involved only one 

respondent. Based on these historical 

numbers, the overall economic impact is 

likely to be small. 

Alternatives Considered 

In developing the proposal, FINRA 

sought to preserve the efficiencies in 

filing and service practices that were 

achieved during the pandemic. No 

significant alternatives to these 

requirements were considered. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were neither 

solicited nor received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 45 days of the date of 

publication of this notice in the Federal 

Register or within such longer period (i) 

as the Commission may designate up to 

90 days of such date if it finds such 

longer period to be appropriate and 

publishes its reasons for so finding or 

(ii) as to which the self-regulatory 

organization consents, the Commission 

will: 

(A) By order approve or disapprove 

such proposed rule change, or 

(B) institute proceedings to determine 

whether the proposed rule change 

should be 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 


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Federal Register / Vol. 87, No. 72 / Thursday, April 14, 2022 / Notices 22269 

47 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3For example, if a User that has elected to 

participate in the free trial program for EDGX Top 

data is approved on April 15, 2022, that User will 

not be subject to any applicable fees (i.e., User Fee) 

through May 14, 2022. 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

FINRA–2022–009 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–FINRA–2022–009. 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 FINRA. 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–FINRA– 

2022–009 and should be submitted on 

or before May 5, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.47

Jill M. Peterson, 

Assistant Secretary. 

[FR Doc. 2022–07955 Filed 4–13–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94645; File No. SR– 

CboeEDGX–2022–020] 

Self-Regulatory Organizations; Cboe 

EDGX Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change To Amend the 

Fees Applicable to Various Market 

Data Products 

April 8, 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 April 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 amend the fees applicable to 

various market data products. The text 

of the proposed rule change is provided 

in Exhibit 5. 

The text of the proposed rule change 

is also available on the Exchange’s 

website (http://markets.cboe.com/us/ 

options/regulation/rule_filings/edgx/) 

[sic], at the Exchange’s Office of the 

Secretary, 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. 

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 the 

Market Data section of its Fees Schedule 

for its equities trading platform (‘‘EDGX 

Equities’’). Particularly, the Exchange 

proposes to adopt a free trial program 

for Exchange market data products, 

effective April 1, 2022. 

The Exchange proposes a 30-day free 

trial for any User or Distributor that 

subscribes to or distributes, 

respectively, an Exchange real-time 

market data product (‘‘Product’’) listed 

on the Fee Schedule for the first time. 

As proposed, a first-time User would be 

any entity or individual that has not 

previously subscribed to a particular 

Product and a first-time Distributor 

would be any entity that has not 

previously distributed, internally or 

externally, a particular Product. A firsttime User or Distributor of a particular 

Exchange market data product would 

not be charged any applicable fees listed 

in the Fee Schedule for that product for 

the duration of the 30 days.3 For 

example, a firm that currently 

subscribes to EDGX Top would be 

eligible to receive a free 30-day trial of 

EDGX Depth, whether in a display-only 

format or for non-display use. However, 

a firm that currently receives EDGX 

Depth for non-display use would not be 

eligible to receive a free 30-day trial of 

EDGX Depth in a display-only format. 

The Exchange would provide the 30-day 

free trial for each particular product to 

each first-time User or Distributor once. 

The Exchange believes that providing 

a 30-day free trial to Exchange real-time 

market data products listed on the 

Exchange’s Fee Schedule would enable 

potential Users and Distributors to 

determine whether a particular 

Exchange market data product provides 

value to their business models or 

investment strategies, as applicable, 

before fully committing to expend 

development and implementation costs 

related to the receipt or distribution of 

that product, and is intended to 

encourage increased use of the 

Exchange’s market data products by 

defraying some of the development and 

implementation costs Users or 

Distributors would ordinarily have to 

expend before using a product. The 


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