Document ID: SEC-2017-1215-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Financial Industry Regulatory Authority, Inc.
Posted Date: 2017-07-19T04:00Z

[Federal Register Volume 82, Number 137 (Wednesday, July 19, 2017)]
[Notices]
[Pages 33189-33191]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-15100]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81139; File No. SR-FINRA-2017-024]

Self-Regulatory Organizations; Financial Industry Regulatory 
Authority, Inc.; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Update Rule Cross-References and Make Non-
Substantive Technical Changes to FINRA Rules

July 13, 2017.
    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 June 30, 2017, 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 and 
II below, which Items have been prepared by FINRA. FINRA has designated 
the proposed rule change as constituting a ``non-controversial'' rule 
change under paragraph (f)(6) of Rule 19b-4 under the Act,\3\ which 
renders the proposal effective upon receipt of this filing by the 
Commission. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of the 
Substance of the Proposed Rule Change

    FINRA is proposing to update cross-references and make other non-
substantive changes within FINRA rules.
    The text of the proposed rule change is available on FINRA's Web 
site 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
    On October 18, 2016, the SEC approved changes to FINRA Rule 6730 
(Transaction Reporting) to expand the Trade Reporting and Compliance 
Engine (``TRACE'') reporting rules to include most secondary market 
transactions in marketable U.S. Treasury securities.\4\ The rule change 
requires all FINRA members involved in transactions in U.S. Treasury 
Securities, as defined in the TRACE rules, to report most transactions 
in those securities to TRACE. The rule change further requires 
Reportable TRACE Transactions in U.S. Treasury Securities generally to 
be reported on the same day as the transaction on an end-of-day basis. 
Because FINRA is not currently proposing to disseminate any trade-level 
information to the public regarding transactions in U.S. Treasury 
Securities, the rule change generally imposed a same-day reporting 
requirement as opposed to a more immediate requirement, such as 15 
minutes. The

[[Page 33190]]

implementation date for the changes is July 10, 2017.\5\
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    \4\ See Securities Exchange Act Release No. 79116 (October 18, 
2016), 81 FR 73167 (October 24, 2016) (Notice of Filing and Order 
Granting Accelerated Approval of File No. SR-FINRA-2016-027).
    \5\ See Regulatory Notice 16-39 (October 2016).
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    The proposed rule change would update the cross reference in FINRA 
Rule 6730(a)(1) to clarify that Reportable TRACE Transactions in U.S. 
Treasury Securities are not subject to the 15-minute reporting 
requirement.
    In addition, the proposed rule change would make technical changes 
to FINRA Rule 6810 (Definitions) \6\ to reflect FINRA Manual style 
convention changes.
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    \6\ See Securities Exchange Act Release No. 80255 (March 15, 
2017), 82 FR 14563 (March 21, 2017) (Order Approving File No. SR-
FINRA-2017-003).
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    FINRA has filed the proposed rule change for immediate 
effectiveness and has requested that the SEC waive the requirement that 
the proposed rule change not become operative for 30 days after the 
date of the filing, so that FINRA can implement the proposed rule 
change to coincide with effective dates of the affected rule. The 
implementation date for the proposed changes to FINRA Rule 6730 will be 
July 10, 2017, to coincide with the implementation date of earlier 
changes to the rule.\7\ The implementation date for the proposed 
changes to FINRA Rule 6810 will be the date of filing.
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    \7\ See supra note 4; see also Regulatory Notice 16-39 (October 
2016).
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2. Statutory Basis
    FINRA believes that the proposed rule change is consistent with the 
provisions of Section 15A(b)(6) of the Act,\8\ 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 the proposed rule change will provide 
greater clarity to members and the public regarding FINRA's rules by 
amending the references in Rule 6810 to conform to FINRA's style 
conventions and by clarifying in Rule 6730 that Reportable TRACE 
Transactions in U.S. Treasury Securities are not subject to the 15-
minute reporting requirement.
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    \8\ 15 U.S.C. 78o-3(b)(6).
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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. The proposed rule change brings 
clarity and consistency to FINRA rules without adding any burden on 
firms.

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

    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)(iii) of the Act \9\ and 
subparagraph (f)(6) of Rule 19b-4 thereunder.\10\
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    \9\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \10\ 17 CFR 240.19b-4(f)(6).
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    A proposed rule change filed under Rule 19b-4(f)(6) normally does 
not become operative before 30 days from the date of the filing. 
However, pursuant to Rule 19b-4(f)(6)(iii),\11\ the Commission may 
designate a shorter time if such action is consistent with the 
protection of investors and the public interest.
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    \11\ 17 CFR 240.19b-4(f)(6)(iii).
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    The Exchange has asked the Commission to waive the 30-day operative 
delay. The Commission believes that waiving the 30-day operative delay 
is consistent with the protection of investors and the public interest. 
The waiver will allow FINRA to update the cross reference in FINRA Rule 
6730 to coincide with the implementation date of that rule, which is 
July 10, 2017. The implementation date for the proposed changes to 
FINRA Rule 6810 is June 30, 2017, the date FINRA filed the instant 
proposed rule change. Therefore, the Commission hereby waives the 30-
day operative delay and designates the proposed rule change to be 
operative upon filing with the Commission.\12\
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    \12\ For purposes only of waiving the operative delay for this 
proposal, the Commission has considered the proposed rule's impact 
on efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    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: (i) 
Necessary or appropriate in the public interest; (ii) for the 
protection of investors; or (iii) 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-FINRA-2017-024 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-2017-024. 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 Web site (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 Web site 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 FINRA. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File Number SR-FINRA-2017-024, and should 
be submitted on or before August 9, 2017.

[[Page 33191]]

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2017-15100 Filed 7-18-17; 8:45 am]
 BILLING CODE 8011-01-P