[Federal Register Volume 76, Number 173 (Wednesday, September 7, 2011)]
[Notices]
[Pages 55441-55443]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-22764]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-65221; File No. SR-FINRA-2011-04]
Self-Regulatory Organizations; Financial Industry Regulatory
Authority, Inc.; Notice of Filing and Immediate Effectiveness of
Proposed Rule Change Relating to Fee for the Operations Professional
Examination
August 30, 2011.
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 August 22, 2011, 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 ``establishing or changing a due, fee, or
other charge'' under Section 19(b)(3)(A)(ii) of the Act \3\ and Rule
19b-4(f)(2) thereunder,\4\ 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.\5\
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A)(ii).
\4\ 17 CFR 240.19b-4(f)(2).
\5\ The proposed rule change is related to FINRA's recently
established registration category and qualification examination
requirement for Operations Professionals. See Securities Exchange
Act Release No. 64687 (June 16, 2011), 76 FR 36586 (June 22, 2011)
(Order Approving File No. SR-FINRA-2011-013).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
FINRA is proposing to amend Schedule A to the FINRA By-Laws to
establish a fee for the new Operations Professional Examination
(``Series 99''). Specifically, the proposed rule change would amend
Section 4 of Schedule A to the FINRA By-Laws to establish a fee of $125
for a person to take the Series
[[Page 55442]]
99 examination. The fee is based on the costs to FINRA to develop and
administer the exam.
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 June 16, 2011, the Commission approved FINRA Rule 1230(b)(6),
which establishes a registration category and qualification examination
requirement for certain operations personnel--Operations
Professionals.\6\ FINRA is expanding its registration provisions to
require registration of certain individuals (``covered persons'') who
are engaged in, responsible for or supervising certain member
operations functions (``covered functions'') to enhance the regulatory
structure surrounding these areas.\7\ FINRA Rule 1230(b)(6) is
intended, among other things, to increase covered persons' awareness
and knowledge that they are operating in a regulated environment
designed to protect investors' interests and the integrity of the
operations of a broker-dealer.
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\6\ See Securities Exchange Act Release No. 64687 (June 16,
2011), 76 FR 36586 (June 22, 2011) (Order Approving File No. SR-
FINRA-2011-013). In addition to adopting FINRA Rule 1230(b)(6), the
rule change adopted NASD Rule 1120 (Continuing Education
Requirements) as new FINRA Rule 1250 (Continuing Education
Requirements) with certain changes, including expanding the scope of
``covered registered persons'' subject to the Firm Element to
include persons registered as Operations Professionals. See also
Regulatory Notice 11-33 (July 2011).
\7\ See Regulatory Notice 11-33 (July 2011) for information
regarding the implementation period for Operations Professionals
subject to FINRA Rule 1230(b)(6).
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FINRA has developed the Series 99 examination program to provide
reasonable assurance that covered persons understand their professional
responsibilities, including key regulatory and control themes, as well
as the importance of identifying and escalating red flags that may harm
a firm, its customers, the integrity of the marketplace or the public.
The examination will test applicants on general securities industry
knowledge and its associated regulations and rules.\8\ On August 19,
2011, [sic] FINRA filed with the Commission the Series 99 selection
specifications and content outline.\9\ The examination will be
implemented on October 17, 2011.\10\
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\8\ FINRA Rule 1230(b)(6)(D) sets forth an exception to the
Operations Professional qualification examination requirement for
persons who currently hold certain registrations (each an ``eligible
registration'') or have held one during the two years immediately
prior to registering as an Operations Professional. The exception
also applies to persons who do not hold an eligible registration,
but prefer an alternative to taking the Operations Professional
examination. Such persons may register in an eligible registration
category (subject to passing the corresponding qualification
examination or obtaining a waiver) and use such registration to
qualify for Operations Professional registration.
\9\ See SR-FINRA-2011-041.
\10\ See Regulatory Notice 11-33 (July 2011).
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The proposed rule change would amend Section 4 of Schedule A to the
FINRA By-Laws to establish a fee of $125 for a person to take the
Series 99 examination. The fee is based on the costs to FINRA to
develop and administer the exam.\11\
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\11\ Candidates for the Series 99 examination will be able to
schedule and take the examination starting on October 17, 2011.
Because this is a new examination for a new registration category,
FINRA will be assessing the effectiveness of the examination by, in
part, evaluating the candidates' performance during the first 60
days of the administration of the examination. Therefore, candidates
who take the examination within the first 60 days (between October
17, 2011 and December 16, 2011) will not receive their test results
on the day that they take the examination. Instead, such candidates'
firms will be notified of test results (i.e., the candidate's score
and whether the candidate has passed or failed the examination) on
or shortly after December 16, 2011. The test results will be posted
to the Central Registration Depository system (``CRD[supreg]
system'') at that time. Candidates who fail the examination during
the initial 60-day rollout will be provided an opportunity to retake
the examination at no additional cost.
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FINRA has filed the proposed rule change for immediate
effectiveness. The implementation date of the proposed rule change and
corresponding FINRA Rule 1230(b)(6) will be October 17, 2011.
2. Statutory Basis
FINRA believes that the proposed rule change is consistent with the
provisions of Section 15A(b)(5) of the Act,\12\ which requires, among
other things, that FINRA rules provide for the equitable allocation of
reasonable dues, fees, and other charges among members and issuers and
other persons using any facility or system that FINRA operates or
controls. FINRA believes the proposed rule change is designed to
accomplish these ends by equitably assessing by means of a reasonable
examination fee the costs associated with developing and administering
the examination program.
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\12\ 15 U.S.C. 78o-3(b)(5).
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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.
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
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \13\ and paragraph (f)(2) of Rule 19b-4
thereunder.\14\ 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.
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\13\ 15 U.S.C. 78s(b)(3)(A).
\14\ 17 CFR 240.19b-4(f)(2).
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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 e-mail to [email protected]. Please include
File Number SR-FINRA-2011-042 on the subject line.
[[Page 55443]]
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-FINRA-2011-042. This
file number should be included on the subject line if e-mail 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-2011-042
and should be submitted on or before September 28, 2011.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
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\15\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-22764 Filed 9-6-11; 8:45 am]
BILLING CODE 8011-01-P