[Federal Register Volume 81, Number 35 (Tuesday, February 23, 2016)]
[Notices]
[Pages 9065-9067]
[FR Doc No: 2016-03665]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77158; File No. SR-FINRA-2016-008]

Self-Regulatory Organizations; Financial Industry Regulatory
Authority, Inc.; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Delay the Implementation Date of FINRA Rule
2242 (Debt Research Analysts and Debt Research Reports)

February 17, 2016.
    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 February 16, 2016, Financial Industry Regulatory Authority, Inc.
(``FINRA'') 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 substantially 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 Substance
of the Proposed Rule Change

    FINRA is proposing to delay implementation of FINRA Rule 2242 (Debt
Research Analysts and Debt Research Reports) until April 22, 2016. The
proposed rule change would not make any other changes to 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 November 14, 2014, FINRA filed proposed rule change SR-FINRA-
2014-048 to adopt new FINRA Rule 2242 (Debt Research Analysts and Debt
Research Reports) to address conflicts of interest relating to the
publication and distribution of debt research reports.\4\ On February
19, 2015, FINRA filed Amendment No. 1 responding to the comments
received to the proposal as well as to propose amendments in response
to these comments.\5\ The proposed rule change, as modified by
Amendment No. 1 thereto, was approved by the Commission on July 16,
2015.\6\
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    \4\ See Securities Exchange Act Release No. 73623 (November 18,
2014), 79 FR 69905 (November 24, 2014) (Notice of Filing File No.
SR-FINRA-2014-048).
    \5\ See Securities Exchange Act Release No. 74490 (March 12,
2015), 80 FR 14198 (March 18, 2015) (Notice of Filing Amendment No.
1 to File No. SR-FINRA-2014-048).
    \6\ See Securities Exchange Act Release No. 75472 (July 16,
2015), 80 FR 43528 (July 22, 2015) (Order Approving File No. SR-
FINRA-2014-048).
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    Pursuant to proposed rule change SR-FINRA-2014-048, FINRA proposed
to announce the effective date of the proposed rule change in a
Regulatory Notice to be published no later than 60 days following
Commission approval. FINRA further stated that the effective date will
be no later than 180 days following publication of the Regulatory
Notice announcing Commission approval. FINRA announced an effective
date of February 22, 2016 in a Regulatory Notice published on August
26, 2015.\7\
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    \7\ See Regulatory Notice 15-31 (August 2015).
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    In response to industry questions regarding implementation of the
requirements of Rule 2242, FINRA believes that it is appropriate to
extend the implementation date and is proposing to delay implementation
of Rule 2242 until April 22, 2016.
    FINRA has filed the proposed rule change for immediate
effectiveness and has requested that the Commission waive the
requirement that the proposed rule change not become operative for 30
days after the date of the filing.
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 is consistent
with the Act in that it provides members additional time to implement
the requirements of Rule 2242, which addresses conflicts of interest
relating to the publication and distribution of debt research reports.
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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 delay in
implementation of Rule 2242 will reduce the burden on members by
allowing additional time to implement changes to their policies and
procedures.

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

    FINRA has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act and Rule 19b-4(f)(6) thereunder.\9\ 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 \10\ and Rule 19b-4(f)(6) thereunder.\11\
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    \9\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), FINRA provided the Commission with written notice of
its intent to file the proposed rule change, along with a brief
description and the 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.
    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f)(6).
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    A proposed rule change filed under Rule 19b-4(f)(6) \12\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b4(f)(6)(iii),\13\ the Commission
may designate a shorter time if such action is consistent with the
protection of investors and the public interest. FINRA has asked the
Commission to waive the 30-day operative delay so that the proposal may
become operative immediately upon filing. The Commission believes that
waiver of the operative delay is consistent with investor protection
and the public interest because the proposal would allow FINRA members
more time to correctly establish systems compliant with FINRA Rule
2242. Accordingly, the Commission hereby waives the 30-day operative
delay and designates the proposal operative upon filing.\14\
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    \12\ 17 CFR 240.19b-4(f)(6).
    \13\ 17 CFR 240.19b-4(f)(6)(iii).
    \14\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. 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 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 under
Section 19(b)(2)(B) \15\ to determine whether the proposed rule should
be approved or disapproved.
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    \15\ 15 U.S.C. 78s(b)(2)(B).
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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<EMAIL_ADDRESS>Please include
File Number SR-FINRA-2016-008 on the subject line.

Paper Comments

     Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.

All submissions should refer to File Number SR-FINRA-2016-008. 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
a.m. and 3 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; 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-2016-008 and should be
submitted on or before March 15, 2016.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
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    \16\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-03665 Filed 2-22-16; 8:45 am]
 BILLING CODE 8011-01-P