Thinking Ahead: Breaking Down FINRA’s Revised Proposed Fixed-Income Research Rule

In the fourth quarter of 2012, FINRA published Regulatory Notice 12-42 (the “Revised Proposal”), amending its proposal for substantive regulation of fixed-income research by FINRA-member firms. The Revised Proposal represents the revision of FINRA’s earlier proposal, and modifies that proposal in meaningful ways.

Executive Summary -

The Revised Proposal amends FINRA’s earlier proposal. In particular, the Revised Proposal:

- Creates a new tier of institutional account that would not be required to affirmatively opt-in to receive institutional fixed income research, which is exempt from the Revised Proposal’s requirements for research distributed to retail investors. This “higher-tier” exemption would be available to Qualified Institutional Buyers that have indicated that they are exercising independent judgment in making investment decisions. Other institutional investors that do not satisfy the higher-tier requirements would have to affirmatively consent to receive institutional research, as required of all institutional investors under FINRA’s earlier proposal.

- For firms with small proprietary fixed-income trading operations, creates an exemption from certain requirements.

Please see full publication below for more information.

LOADING PDF: If there are any problems, click here to download the file.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Shearman & Sterling LLP | Attorney Advertising

Written by:


Shearman & Sterling LLP on:

Popular Topics
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.