Notice2026-08474
Program for Allocation of Regulatory Responsibilities Pursuant to Rule 17d-2; Notice of Filing and Order Approving and Declaring Effective an Amended Plan for the Allocation of Regulatory Responsibilities Between the Financial Industry Regulatory Authority, Inc. and Investors Exchange LLC
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
May 1, 2026
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 91 Issue 84 (Friday, May 1, 2026)</title>
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<body><pre>
[Federal Register Volume 91, Number 84 (Friday, May 1, 2026)]
[Notices]
[Pages 23506-23512]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-08474]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-105332; File No. 4-700]
Program for Allocation of Regulatory Responsibilities Pursuant to
Rule 17d-2; Notice of Filing and Order Approving and Declaring
Effective an Amended Plan for the Allocation of Regulatory
Responsibilities Between the Financial Industry Regulatory Authority,
Inc. and Investors Exchange LLC
April 28, 2026.
Notice is hereby given that the Securities and Exchange Commission
(``Commission'') has issued an Order, pursuant to Section 17(d) of the
Securities Exchange Act of 1934 (``Act''),\1\ approving and declaring
effective an amendment to the plan for allocating regulatory
responsibility (``Plan'') filed on April 15, 2026, pursuant to Rule
17d-2 of the Act,\2\ by the Financial Industry Regulatory Authority,
Inc. (``FINRA'') and Investors Exchange LLC (``IEX'') (together, the
``Parties''). This Agreement amends and restates the agreement entered
into between FINRA and IEX approved by the SEC on October 14, 2021,
entitled ``Agreement between Financial Industry Regulatory Authority,
Inc. and Investors' Exchange LLC pursuant to Rule 17d-2 under the
Securities Exchange Act of 1934,'' and any subsequent amendments
thereafter.
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\1\ 15 U.S.C. 78q(d).
\2\ 17 CFR 240.17d-2.
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I. Introduction
Section 19(g)(1) of the Act,\3\ among other things, requires every
self-regulatory organization (``SRO'') registered as either a national
securities exchange or national securities association to examine for,
and enforce compliance by, its members and persons associated with its
members with the Act, the rules and regulations thereunder, and the
SRO's own rules, unless the SRO is relieved of this responsibility
pursuant to Section 17(d) or Section 19(g)(2) of the Act.\4\ Without
this relief, the statutory obligation of each individual SRO could
result in a pattern of multiple examinations of broker-dealers that
maintain memberships in more than one SRO (``common members''). Such
regulatory duplication would add unnecessary expenses for common
members and their SROs.
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\3\ 15 U.S.C. 78s(g)(1).
\4\ 15 U.S.C. 78q(d) and 15 U.S.C. 78s(g)(2), respectively.
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Section 17(d)(1) of the Act \5\ was intended, in part, to eliminate
unnecessary multiple examinations and regulatory duplication.\6\ With
respect to a common member, Section 17(d)(1) authorizes the Commission,
by rule or order, to relieve an SRO of the responsibility to receive
regulatory reports, to examine for and enforce compliance with
applicable statutes, rules, and regulations, or to perform other
specified regulatory functions.
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\5\ 15 U.S.C. 78q(d)(1).
\6\ See Securities Act Amendments of 1975, Report of the Senate
Committee on Banking, Housing, and Urban Affairs to Accompany S.
249, S. Rep. No. 94-75, 94th Cong., 1st Session 32 (1975).
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To implement Section 17(d)(1), the Commission adopted two rules:
Rule 17d-1 and Rule 17d-2 under the Act.\7\ Rule 17d-1 authorizes the
Commission to name a single SRO as the designated examining authority
(``DEA'') to examine common members for compliance with the financial
responsibility requirements imposed by the Act, or by Commission or SRO
rules.\8\ When an SRO has been named as a common member's DEA, all
other SROs to which the common member belongs are relieved of the
responsibility to examine the firm for compliance with the applicable
financial responsibility rules. On its face, Rule 17d-1 deals only with
an SRO's obligations to enforce member compliance with financial
responsibility requirements. Rule 17d-1 does not relieve an SRO from
its obligation to examine a common member for compliance with its own
rules and provisions of the federal securities laws governing matters
other than financial responsibility, including sales practices and
trading activities and practices.
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\7\ 17 CFR 240.17d-1 and 17 CFR 240.17d-2, respectively.
\8\ See Securities Exchange Act Release No. 12352 (April 20,
1976), 41 FR 18808 (May 7, 1976).
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To address regulatory duplication in these and other areas, the
Commission adopted Rule 17d-2 under the Act.\9\ Rule 17d-2 permits SROs
to propose joint plans for the allocation of regulatory
responsibilities with respect
[[Page 23507]]
to their common members. Under paragraph (c) of Rule 17d-2, the
Commission may declare such a plan effective if, after providing for
appropriate notice and comment, it determines that the plan is
necessary or appropriate in the public interest and for the protection
of investors; to foster cooperation and coordination among the SROs; to
remove impediments to, and foster the development of, a national market
system and a national clearance and settlement system; and is in
conformity with the factors set forth in Section 17(d) of the Act.
Commission approval of a plan filed pursuant to Rule 17d-2 relieves an
SRO of those regulatory responsibilities allocated by the plan to
another SRO.
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\9\ See Securities Exchange Act Release No. 12935 (October 28,
1976), 41 FR 49091 (November 8, 1976).
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II. The Plan
On July 28, 2016, the Commission declared effective the Plan
entered into between FINRA and IEX for allocating regulatory
responsibility pursuant to Rule 17d-2.\10\ The Plan is intended to
reduce regulatory duplication for firms that are common members of
FINRA and IEX by allocating regulatory responsibility with respect to
certain applicable laws, rules, and regulations that are common among
them. Included in the Plan is an exhibit that lists every IEX rule for
which FINRA bears responsibility under the Plan for overseeing and
enforcing with respect to IEX members that are also members of FINRA
and the associated persons therewith (``Certification''). On September
13, 2021, the parties submitted an amendment to the Plan to clarify
what is considered a Common Rule under the Plan, add Securities
Exchange Act Rules 604, 610(d), and 611 to the Certification, eliminate
the requirement that IEX provide to FINRA a current list of members
each quarter, and eliminate the requirement that IEX and FINRA notify
Dual Members of the Agreement after the Effective Date by a uniform
joint notice.
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\10\ See Securities Exchange Act Release No. 78434 (July 28,
2016), 81 FR 51256 (August 3, 2016).
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III. Proposed Amendment To Plan
On April 15, 2026, the parties submitted a proposed amendment to
the Plan (``Amended Plan''). The primary purpose of the Amended Plan is
to add Securities Exchange Act Rule 14e-4(a)(1)(ii)(D) to the
Certification to accommodate the upcoming launch of IEX's new options
facility, to amend the procedures regarding statutory
disqualifications, and to reflect updated rule citations. The text of
the proposed Amended Plan is as follows (additions are italicized;
deletions are [bracketed]):
Agreement Between Financial Industry Regulatory Authority, Inc. and
Investors' Exchange LLC Pursuant to Rule 17d-2 Under the Securities
Exchange Act of 1934
This Agreement, by and between the Financial Industry Regulatory
Authority, Inc. (``FINRA'') and Investors' Exchange LLC (``IEX''), is
made this 14th [9th] day of April [September], 2026[1] (the
``Agreement''), pursuant to Section 17(d) of the Securities Exchange
Act of 1934 (the ``Exchange Act'') and Rule 17d-2 thereunder, which
permits agreements between self-regulatory organizations to allocate
regulatory responsibility to eliminate regulatory duplication. FINRA
and IEX may be referred to individually as a ``party'' and together as
the ``parties.''
This Agreement amends and restates the agreement entered into
between FINRA and IEX on September 9, 2021 [June 20, 2016], entitled
``Agreement between Financial Industry Regulatory Authority, Inc. and
Investors' Exchange LLC pursuant to Rule 17d-2 under the Securities
Exchange Act of 1934,'' and any subsequent amendments thereafter.
Whereas, FINRA and IEX desire to reduce duplication in the
examination and surveillance of their Dual Members (as defined herein)
and in the filing and processing of certain registration and membership
records; and
Whereas, FINRA and IEX desire to execute an agreement covering such
subjects pursuant to the provisions of Rule 17d-2 under the Exchange
Act and to file such agreement with the Securities and Exchange
Commission (the ``SEC'' or ``Commission'') for its approval.
Now, Therefore, in consideration of the mutual covenants contained
hereinafter, FINRA and IEX hereby agree as follows:
1. Definitions. Unless otherwise defined in this Agreement or the
context otherwise requires, the terms used in this Agreement shall have
the same meaning as they have under the Exchange Act and the rules and
regulations thereunder. As used in this Agreement, the following terms
shall have the following meanings:
(a) ``IEX Rules'' or ``FINRA Rules'' shall mean: (i) the rules of
IEX, or (ii) the rules of FINRA, respectively, as the rules of an
exchange or association are defined in Exchange Act Section 3(a)(27).
(b) ``Common Rules'' shall mean IEX Rules that are substantially
similar to the applicable FINRA Rules and certain provisions of the
Exchange Act and SEC rules set forth on Exhibit 1 in that examination
or surveillance for compliance with such provisions and rules would not
require FINRA to develop one or more new examination or surveillance
standards, modules, procedures, or criteria in order to analyze the
application of the provision or rule, or a Dual Member's activity,
conduct, or output in relation to such provision or rule; provided,
however, Common Rules shall not include the application of the SEC, IEX
or FINRA rules as they pertain to violations of insider trading
activities, which is covered by a separate 17d-2 Agreement by and
among, Cboe BZX Exchange, Inc., Cboe BYX Exchange, Inc., NYSE Texas
[Chicago], Inc., Cboe EDGA Exchange, Inc., Cboe EDGX Exchange, Inc.,
Financial Industry Regulatory Authority, Inc., MEMX, LLC, MIAX PEARL,
LLC, Nasdaq BX, Inc., Nasdaq PHLX LLC, The Nasdaq Stock Market LLC,
NYSE National, Inc., New York Stock Exchange LLC, NYSE American LLC,
NYSE Arca, Inc., Investors Exchange LLC, [and] Long-Term Stock
Exchange, Inc., 24X National Exchange LLC and Green Impact Exchange,
LLC approved by the Commission on July 1, 2025 [September 23, 2020] as
may be amended from time to time. Common Rules shall not include any
provisions regarding: (i) notice, reporting or any other filings made
directly to or from IEX; (ii) incorporation by reference of other IEX
Rules that are not Common Rules; (iii) exercise of discretion in a
manner that differs from FINRA's exercise of discretion including, but
not limited to exercise of exemptive authority by IEX; (iv) prior
written approval of IEX; and (v) payment of fees or fines to IEX.
(c) ``Dual Members'' shall mean those IEX members that are also
members of FINRA and the associated persons therewith.
(d) ``Effective Date'' shall be the date this Agreement is approved
by the Commission.
(e) ``Enforcement Responsibilities'' shall mean the conduct of
appropriate proceedings, in accordance with FINRA's Code of Procedure
(the Rule 9000 Series) and other applicable FINRA procedural rules, to
determine whether violations of Common Rules have occurred, and if such
violations are deemed to have occurred, the imposition of appropriate
sanctions as specified under FINRA's Code of Procedure and sanctions
guidelines.
(f) ``Regulatory Responsibilities'' shall mean the examination
responsibilities, surveillance responsibilities and Enforcement
Responsibilities relating to compliance by the Dual Members with the
Common Rules and the provisions
[[Page 23508]]
of the Exchange Act and the rules and regulations thereunder, and other
applicable laws, rules and regulations, each as set forth on Exhibit 1
attached hereto.
2. Regulatory and Enforcement Responsibilities. FINRA shall assume
Regulatory Responsibilities and Enforcement Responsibilities for Dual
Members. Attached as Exhibit 1 to this Agreement and made part hereof,
IEX furnished FINRA with a current list of Common Rules and certified
to FINRA that such rules that are IEX Rules are substantially similar
to the corresponding FINRA Rules (the ``Certification''). FINRA hereby
agrees that the rules listed in the Certification are Common Rules as
defined in this Agreement. Each year following the Effective Date of
this Agreement, or more frequently if required by changes in either the
rules of IEX or FINRA, IEX shall submit an updated list of Common Rules
to FINRA for review which shall add IEX Rules not included in the
current list of Common Rules that qualify as Common Rules as defined in
this Agreement; delete IEX Rules included in the current list of Common
Rules that no longer qualify as Common Rules as defined in this
Agreement; and confirm that the remaining rules on the current list of
Common Rules continue to be IEX Rules that qualify as Common Rules as
defined in this Agreement. Within 30 days of receipt of such updated
list, FINRA shall confirm in writing whether the rules listed in any
updated list are Common Rules as defined in this Agreement.
Notwithstanding anything herein to the contrary, it is explicitly
understood that the term ``Regulatory Responsibilities'' does not
include, and IEX shall retain full responsibility for (unless otherwise
addressed by separate agreement or rule) (collectively, the ``Retained
Responsibilities'') the following:
(a) surveillance, examination, investigation and enforcement with
respect to trading activities or practices involving IEX's own
marketplace for rules that are not Common Rules;
(b) registration pursuant to its applicable rules of associated
persons (i.e., registration rules that are not Common Rules);
(c) discharge of its duties and obligations as a Designated
Examining Authority pursuant to Rule 17d-1 under the Exchange Act; and
(d) any IEX Rules that are not Common Rules, except for IEX Rules
for IEX Services LLC as provided in paragraph 5.
3. No Charge. There shall be no charge to IEX by FINRA for
performing the Regulatory Responsibilities and Enforcement
Responsibilities under this Agreement except as otherwise agreed by the
parties, either herein or in a separate agreement.
4. Applicability of Certain Laws, Rules, Regulations or Orders.
Notwithstanding any provision hereof, this Agreement shall be subject
to any statute, or any rule or order of the Commission. To the extent
such statute, rule or order is inconsistent with this Agreement, the
statute, rule or order shall supersede the provision(s) hereof to the
extent necessary for them to be properly effectuated and the
provision(s) hereof in that respect shall be null and void.
5. Notification of Violations.
(a) In the event that FINRA becomes aware of apparent violations of
any IEX Rules, which are not listed as Common Rules, discovered
pursuant to the performance of the Regulatory Responsibilities assumed
hereunder, FINRA shall notify IEX of those apparent violations for such
response as IEX deems appropriate.
(b) In the event that IEX becomes aware of apparent violations of
any Common Rules, discovered pursuant to the performance of the
Retained Responsibilities, IEX shall notify FINRA of those apparent
violations and such matters shall be handled by FINRA as provided in
this Agreement. With respect to apparent violations of IEX Services LLC
FINRA shall not make referrals to IEX pursuant to this paragraph 5.
Such apparent violations shall be processed by, and enforcement
proceedings in respect thereto will be conducted by, FINRA as provided
in this Agreement.
(c) Apparent violations of Common Rules shall be processed by, and
enforcement proceedings in respect thereto shall be conducted by FINRA
as provided hereinbefore; provided, however, that in the event a Dual
Member is the subject of an investigation relating to a transaction on
IEX, IEX may in its discretion assume concurrent jurisdiction and
responsibility.
(d) Each party agrees to make available promptly all files, records
and witnesses necessary to assist the other in its investigation or
proceedings.
6. Continued Assistance.
(a) FINRA shall make available to IEX all information obtained by
FINRA in the performance by it of the Regulatory Responsibilities
hereunder with respect to the Dual Members subject to this Agreement.
In particular, and not in limitation of the foregoing, FINRA shall
furnish IEX any information it obtains about Dual Members which
reflects adversely on their financial condition. IEX shall make
available to FINRA any information coming to its attention that
reflects adversely on the financial condition of Dual Members or
indicates possible violations of applicable laws, rules or regulations
by such firms.
(b) The parties agree that documents or information shared shall be
held in confidence, and used only for the purposes of carrying out
their respective regulatory obligations. Neither party shall assert
regulatory or other privileges as against the other with respect to
documents or information that is required to be shared pursuant to this
Agreement.
(c) The sharing of documents or information between the parties
pursuant to this Agreement shall not be deemed a waiver as against
third parties of regulatory or other privileges relating to the
discovery of documents or information.
7. Statutory Disqualifications. When FINRA becomes aware of a
statutory disqualification as defined in the Exchange Act with respect
to a Dual Member, FINRA will [shall] determine pursuant to Sections
15A(g) and/or Section 6(c) of the Exchange Act the acceptability or
continued acceptability [applicability] of the Dual Member [person] to
whom such disqualification applies, and whether a notice is required to
be filed under Section 19h-1 of the Exchange Act [keep IEX advised of
its actions in this regard for such subsequent proceedings as IEX may
initiate].
FINRA shall advise IEX in writing of such acceptability or
continued acceptability, which may include providing IEX with draft
notices or other draft documents regarding the disqualified Dual
Member. IEX shall, within 30 days of receiving such information from
FINRA, advise FINRA in writing of its decision regarding whether it
concurs with FINRA's determination.
When FINRA becomes aware of a statutory disqualification as defined
in the Exchange Act with respect to a Dual Member that does not result
in FINRA determining the acceptability or continued acceptability of
the Dual Member or in preparing a notice under Section 19h-1 of the
Exchange Act, FINRA shall, if appropriate, promptly update in CRD the
statutory disqualification status of the Dual Member. Such update shall
include any applicable information pertaining to the reason for the
statutory disqualification and, as applicable, any resolution
pertaining to the Dual Member's statutory disqualification.
8. Customer Complaints. IEX shall forward to FINRA copies of all
customer
[[Page 23509]]
complaints involving Dual Members received by IEX relating to FINRA's
Regulatory Responsibilities under this Agreement. It shall be FINRA's
responsibility to review and take appropriate action in respect to such
complaints.
9. Advertising. FINRA shall assume responsibility to review the
advertising of Dual Members subject to the Agreement, provided that
such material is filed with FINRA in accordance with FINRA's filing
procedures and is accompanied with any applicable filing fees set forth
in FINRA Rules.
10. No Restrictions on Regulatory Action. Nothing contained in this
Agreement shall restrict or in any way encumber the right of either
party to conduct its own independent or concurrent investigation,
examination or enforcement proceeding of or against Dual Members, as
either party, in its sole discretion, shall deem appropriate or
necessary.
11. Termination. This Agreement may be terminated by IEX or FINRA
at any time upon the approval of the Commission after one (1) year's
written notice to the other party.
12. Arbitration. In the event of a dispute between the parties as
to the operation of this Agreement, IEX and FINRA hereby agree that any
such dispute shall be settled by arbitration in Washington, DC in
accordance with the rules of the American Arbitration Association then
in effect, or such other procedures as the parties may mutually agree
upon. Judgment on the award rendered by the arbitrator(s) may be
entered in any court having jurisdiction. Each party acknowledges that
the timely and complete performance of its obligations pursuant to this
Agreement is critical to the business and operations of the other
party. In the event of a dispute between the parties, the parties shall
continue to perform their respective obligations under this Agreement
in good faith during the resolution of such dispute unless and until
this Agreement is terminated in accordance with its provisions. Nothing
in this Section 12 shall interfere with a party's right to terminate
this Agreement as set forth herein.
13. Separate Agreement. This Agreement is wholly separate from the
following agreements: (1) the multiparty agreement made pursuant to
Rule 17d-2 of the Exchange Act among Cboe BZX Exchange, Inc., BOX
Exchange, LLC, Cboe Exchange, Inc., Cboe C2 Exchange, Inc., Nasdaq ISE,
LLC, Financial Industry Regulatory Authority, Inc., Miami International
Securities Exchange, LLC, NYSE American LLC, NYSE Arca, Inc., The
Nasdaq Stock Market LLC, Nasdaq BX, Inc., Nasdaq PHLX LLC, Nasdaq GEMX,
LLC, Cboe EDGX Exchange, Inc., Nasdaq MRX, LLC, MIAX PEARL, LLC, MIAX
Emerald, LLC, MIAX Sapphire, LLC and MEMX LLC involving the allocation
of regulatory responsibilities with respect to common members for
compliance with common rules relating to the conduct by broker-dealers
of accounts for listed options or index warrants entered as approved by
the SEC on July 31, 2024, and as may be amended from time to time; and
(2) the multiparty agreement made pursuant to Rule 17d-2 of the
Exchange Act among NYSE American LLC, Cboe BZX Exchange, Inc., Cboe
EDGX Exchange, Inc., Cboe C2 Exchange, Inc., Cboe Exchange, Inc.,
Nasdaq ISE, LLC, Financial Industry Regulatory Authority, Inc., NYSE
Arca, Inc., The Nasdaq Stock Market LLC, BOX Exchange LLC, Nasdaq BX,
Inc., Nasdaq PHLX LLC, Miami International Securities Exchange, LLC,
Nasdaq GEMX, LLC, Nasdaq MRX, LLC, MIAX PEARL, LLC, MIAX Emerald, LLC,
MIAX Sapphire and MEMX LLC involving the allocation of regulatory
responsibilities with respect to SRO market surveillance of common
members activities with regard to certain common rules relating to
listed options approved by the SEC on August 1, 2024, and as may be
amended from time to time.
14. Amendment. This Agreement may be amended in writing duly
approved by each party. All such amendments must be filed with and
approved by the Commission before they become effective.
15. [14.] Limitation of Liability. Neither FINRA nor IEX nor any of
their respective directors, governors, officers or employees shall be
liable to the other party to this Agreement for any liability, loss or
damage resulting from or claimed to have resulted from any delays,
inaccuracies, errors or omissions with respect to the provision of
Regulatory Responsibilities as provided hereby or for the failure to
provide any such responsibility, except with respect to such liability,
loss or damages as shall have been suffered by one or the other of
FINRA or IEX and caused by the willful misconduct of the other party or
their respective directors, governors, officers or employees. No
warranties, express or implied, are made by FINRA or IEX with respect
to any of the responsibilities to be performed by each of them
hereunder.
16. [15.] Relief from Responsibility. Pursuant to Sections
17(d)(1)(A) and 19(g) of the Exchange Act and Rule 17d-2 thereunder,
FINRA and IEX join in requesting the Commission, upon its approval of
this Agreement or any part thereof, to relieve IEX of any and all
responsibilities with respect to matters allocated to FINRA pursuant to
this Agreement; provided, however, that this Agreement shall not be
effective until the Effective Date.
17. [16.] Severability. Any term or provision of this Agreement
that is invalid or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the
remaining terms and provisions of this Agreement or affecting the
validity or enforceability of any of the terms or provisions of this
Agreement in any other jurisdiction.
18. [17.] Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, and such
counterparts together shall constitute one and the same instrument.
* * * * *
Exhibit 1
IEX Certification of Common Rules
IEX hereby certifies that the requirements contained in the rules
listed below for IEX are identical to, or substantially similar to, the
comparable FINRA Rules, Exchange Act provision or SEC rule identified
(``Common Rules'').
[# Common Rules shall not include provisions regarding (i) notice,
reporting or any other filings made directly to or from IEX, (ii)
incorporations by reference of other IEX Rules that are not Common
Rules (iii) exercise of discretion in a manner that differs from
FINRA's exercise of discretion including, but not limited to exercise
of exemptive authority, by IEX, (iv) prior written approval of IEX, and
(v) payment of fees or fines to IEX.]
------------------------------------------------------------------------
FINRA rule, exchange act
IEX rule provision, SEC rule
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Rule 2.140 Prohibited Conditions FINRA Rule 2081 Prohibited
Relating to Expungement of Customer Conditions Relating to
Dispute. Expungement of Customer
Dispute.
[[Page 23510]]
Rule 2.160(o) Registration Requirements FINRA Rule 1210.08--
and Restrictions on Membership--Lapse Registration Requirements--
of Registration and Expiration of SIE. Lapse of Registration and
Expiration of SIE.
Rule 2.160(p) Registration Requirements FINRA Rule 1240[(a)(1)-(4), (6)-
and Restrictions on Membership-- (7) and (b)] Continuing
Continuing Education Requirements Education [Requirements].
\1\.
Rule 2.160(q) [and] Registration FINRA By-Laws of the
Requirements and Restrictions on Corporation Article IV, Sec
Membership--Registration Procedures; 1(c) Application for
Rule 2.160(r) Registration Membership, Article V,
Requirements and Restrictions on Sections 2 and 3 Application
Membership[, and]--Termination of for Registration and
Employment; Rule 2.170(b) and (g) Notification by Member to the
Application Procedures for Membership Corporation and Associated
or to become an Associated Person of a Person of Termination;
Member . Amendments to Notification,
FINRA Rule 1010(c) and (e)
Electronic Filing Requirements
for Uniform Forms and FINRA
Rule 4517 Member[s] Filing and
Contact Information
Requirements.
Rule 2.240 Fidelity Bonds ............ FINRA Rule 4360 Fidelity Bonds.
Rule 3.110 Business Conduct of Members FINRA Rule 2010 Standards of
[supcaret]. Commercial Honor and
Principles of Trade
[supcaret].
Rule 3.120 Violations Prohibited [1] 2 FINRA Rule 2010 Standards of
[supcaret] . Commercial Honor and
Principles of Trade [supcaret]
and FINRA Rule 3110
Supervision.
Rule 3.130 Use of Fraudulent Devices FINRA Rule 2020 Use of
[supcaret]. Manipulative, Deceptive or
Other Fraudulent Devices
[supcaret].
Rule 3.150 Know Your Customer.......... FINRA Rule 2090 Know Your
Customer.
Rule 3.160 Fair Dealing with Customers. FINRA Rule 2020 Use of
Manipulative, Deceptive or
Other Fraudulent Devices
[supcaret].
Rule 3.170 Suitability................. FINRA Rule 2111 Suitability.
Rule 3.180(a) The Prompt Receipt and FINRA Rule 11860 COD Orders.
Delivery of Securities--Purchases.
Rule 3.180(b) The Prompt Receipt and SEA Regulation SHO.
Delivery of Securities--Sales.
Rule 3.190 Charges for Services FINRA Rule 2122 Charges for
Performed. Services Performed.
Rule 3.200 Use of Information Obtained FINRA Rule 2060 Use of
in a Fiduciary Capacity. Information Obtained in
Fiduciary Capacity.
Rule 3.210 Publication of Transactions FINRA Rule 5210 Publication of
and Quotations. Transactions and Quotations.
Rule 3.220 Offers at Stated Prices..... FINRA Rule 5220 Offers at
Stated Prices.
Rule 3.230 Payments Involving FINRA Rule 5230 Payments
Publications that Influence the Market Involving Publications that
Price of a Security. Influence the Market Price of
a Security.
Rule 3.240 Customer Confirmations...... FINRA Rule 2232(a) Customer
Confirmations and SEA Rule 10b-
10 Confirmation of
Transactions.
Rule 3.250 Disclosure of Control FINRA Rule 2262 Disclosure of
Relationship with Issuer. Control Relationship with
Issuer.
Rule 3.260 Discretionary Accounts...... FINRA Rule 3260 Discretionary
Accounts.
Rule 3.270 Improper Use of Customers' FINRA Rule 2150(a)-(c) and SM
Securities or Funds; Prohibition .03 Improper Use of Customers'
Against Guarantees and Sharing in Securities or Funds;
Accounts. Prohibition Against Guarantees
and Sharing in Accounts.
Rule 3.280 Communications with FINRA Rule 2210 Communications
Customers and the Public. with the Public.
Rule 3.290 Customer Disclosures........ FINRA Rule 2265 Extended Hours
Trading Risk Disclosure.
Rule 3.291 Influencing or Rewarding FINRA Rule 3220 Influencing or
Employees of Others; Gratuities. Rewarding Employees of Others.
Rule 3.292 Telemarketing............... FINRA Rule 3230 Telemarketing.
Rule 3.293 Short-Interest Reporting.... FINRA Rule 4560 Short-Interest
Reporting.
Rule 4.511 General Requirements........ FINRA Rule 4511 General
Requirements.
Rule 4.512 Customer Account Information FINRA Rule 4512 Customer
Account Information.
Rule 4.513 Record of Written Customer FINRA Rule 4513 Record of
Complaints. Written Customer Complaints.
Rule 4.550 Disclosure of Financial FINRA Rule 2261 Disclosure of
Condition. Financial Condition.
Rule 5.110 Supervision ............... FINRA Rule 3110 Supervision.
Rule................................... FINRA Rule 3120 Supervisory
Control System.
Rule 5.130 Annual Certification of FINRA Rule 3130 Annual
Compliance and Supervisory Processes . Certification of Compliance
and Supervisory Processes.
Rule 5.160 Anti-Money Laundering FINRA Rule 3310 Anti-Money
Compliance Program . Laundering Compliance Program.
Rule 5.170 Transactions for or by FINRA Rule 3210 Accounts At
Associated Persons. Other Broker-Dealers and
Financial Institutions.
Rule 6.120 Failure to Deliver and Regulation SHO Rules 200 and
Failure to Receive. 203.
Rule 6.130(a), (b), (d)-(i) Forwarding FINRA Rule 2251 Processing and
of Proxy and Other Issuer-Related Forwarding of Proxy and Other
Materials; Proxy Voting. Issuer-Related Materials.
Rule 10.110(a) Market Manipulation..... FINRA Rule 6140 Other Trading
Practices.
Rule 10.110(b) Market Manipulation..... FINRA Rule 5210 Publication of
Transactions and Quotations;
[,] FINRA Rule 2020 Use of
Manipulative, Deceptive or
Other Fraudulent Devices; [,]
FINRA Rule 2010 Standards of
Commercial Honor and
Principles of Trade; [,] and
FINRA Rule 6140(a) Other
Trading Practices.
Rule 10.120 Fictitious Transactions.... FINRA Rule 6140 Other Trading
Practices and FINRA Rule 5210
Supplementary Material .02
Self-Trades.
Rule 10.130 Excessive Sales By \a\ [A] FINRA Rule 6140(c) Other
Member. Trading Practices.
Rule 10.140 Manipulative Transactions.. FINRA Rule 6140 Other Trading
Practices.
Rule 10.150 Dissemination of False FINRA Rule 6140(e) Other
Information. Trading Practices.
Rule 10.160 Prohibition Against Trading FINRA Rule 5320 Prohibition
Ahead of Customer Orders . Against Trading Ahead of
Customer Orders \**\.
Rule 10.180 Influencing the FINRA Rule 6140(a) Other
Consolidated Tape. Trading Practices and FINRA
Rule 5210 Publication of
Transactions and Quotations.
Rule 10.190 Trade Shredding............ FINRA Rule 5290 Order Entry and
Execution Practices.
Rule 10.220 Best Execution and FINRA Rule 5310 Best Execution
Interpositioning \**\. and Interpositioning \**\
Rule 10.240 Trading Ahead of Research FINRA Rule 5280 Trading Ahead
Reports \**\. of Research Reports \**\.
[[Page 23511]]
Rule 10.260 Front Running of Block FINRA Rule 5270 Front Running
Transactions \**\. of Block Transactions \**\.
Rule 11.151(e) Market Maker FINRA Rule 6240(a)--(c), (d)(1)
Obligations--Locked and Crossed and (2) Prohibition from
Markets. Locking or Crossing Quotations
in NMS Stocks.
Rule 11.280(b)(1)(A)(i)(b) & (c) FINRA Rule 6190(a)&(b)
[(e)(3) & (4)]. Compliance with Regulation NMS
Limit Up-Limit Down Plan and Trading Plan to Address Extraordinary
Halts--Regulatory Halts [Due to Market Volatility.
Extraordinary Market Volatility].
Rule 11.310 Locking or Crossing FINRA Rule 6240(a),--(c),
Quotations in NMS Stocks \**\. (d)(1) and (2) Prohibition
from Locking or Crossing
Quotations in NMS Stocks **.
[Rule 11.420(c) Order Audit Trail [FINRA Rule 4590
System Requirements]. Synchronization of Member
Business Clocks].
[Rule 11.420(d)--Order Audit Trail [FINRA Rule 7440--Recording of
System Requirements--Recording of Order Information].
Order Information].
[Rule 11.420(e)--Order Audit Trail [FINRA Rule 7450--Order Data
System Requirements--Order Data Transmission].
Transmission Requirements].
Rule 12.110(c) Arbitration - Predispute FINRA Rule 2268 Requirements
Arbitration Agreements. When Using Predispute
Arbitration Agreements for
Customer Accounts.
Rule 27.200 Restrictions on Pledge and FINRA Rule 4330 Customer
Lending of Public Customers' Protection--Permissible Use of
Securities. Customers' Securities.
------------------------------------------------------------------------
\1\ FINRA Rule 1240.01 allows for eligible persons to make their
election to participate in the continuing education program under Rule
1240(c) either (1) between January 31, 2022, and March 15, 2022; or
(2) between March 15, 2023, and December 31, 2023. In contrast,
Supplementary Material .01 of IEX Rule 2.160(p) allows for eligible
persons to make their election to participate in the continuing
education program under IEX Rule 2.160(p) by: (i) electing to
participate with FINRA in the continuing education program under IEX
Rule 2.160(p)(c) by March 15, 2022; or (ii) electing to participate
with IEX between July 17, 2023, and December 31, 2023. Therefore,
FINRA will not accept Regulatory Responsibilities for elections made
under Supplementary Material .01 of IEX Rule 2.160(p) between March
15, 2023, and July 16, 2023.
\2\ [\1\] FINRA shall only have Regulatory Responsibilities for Rule
3.120(a) regarding conduct in violation of the Act, or the rules or
regulations thereunder.
Common Rules shall not include provisions regarding (i) notice,
reporting or any other filings made directly to or from IEX, (ii)
incorporations by reference of other IEX Rules that are not Common
Rules (iii) exercise of discretion in a manner that differs from
FINRA's exercise of discretion including, but not limited to exercise
of exemptive authority, by IEX, (iv) prior written approval of IEX,
and (v) payment of fees or fines to IEX.
[supcaret] FINRA shall not have any Regulatory Responsibilities for
these rules insofar as they pertain to violations of insider trading
activities, which is covered by a separate 17d-2 Agreement by and
among Cboe BZX Exchange, Inc., Cboe BYX Exchange, Inc., NYSE Chicago,
Inc., Cboe EDGA Exchange Inc., Cboe EDGX Exchange Inc., Financial
Industry Regulatory Authority, Inc., MEMX, LLC, MIAX PEARL, LLC,
Nasdaq BX, Inc., Nasdaq PHLX LLC, The Nasdaq Stock Market LLC, NYSE
National, Inc., New York Stock Exchange, LLC, NYSE American LLC, NYSE
Arca Inc., Investors' Exchange LLC, Long-Term Stock Exchange, Inc.,
24X National Exchange LLC and Green Impact Exchange, LLC as approved
by the SEC on September 9, 2025, as may be amended from time to time.
In addition, the following provisions shall be part of this 17d-2
Agreement:
Securities Exchange Act of 1934 (``SEA''):
Section 15(g)
SEA Rules:
<bullet> SEA Rule 200 of Regulation SHO--Definition of Short Sales and
Marking Requirements **
<bullet> SEA Rule 201 of Regulation SHO--Circuit Breaker **
<bullet> SEA Rule 203 of Regulation SHO--Borrowing and Delivery
Requirements **
<bullet> SEA Rule 204 of Regulation SHO--Close-Out Requirement **
<bullet> SEA Rule 101 of Regulation M--Activities by Distribution
Participants **
<bullet> SEA Rule 102 of Regulation M--Activities by Issuers and Selling
Security Holders During a Distribution **
<bullet> SEA Rule 103 of Regulation M--Nasdaq Passive Market Making **
<bullet> SEA Rule 104 of Regulation M--Stabilizing and Other Activities
in Connection with an Offering **
<bullet> SEA Rule 105 of Regulation M--Short Selling in Connection With
a Public Offering **
<bullet> SEA Rule 604 of Regulation NMS--Display of Customer Limit
Orders **
<bullet> SEA Rule 610(d) of Regulation NMS--Locking or Crossing
Quotations **
<bullet> SEA Rule 611 of Regulation NMS--Order Protection Rule **
<bullet> SEA Rule 10b-5 Employment of Manipulative and Deceptive Devices
[supcaret]
<bullet> SEA Rule 17a-3/17a-4--Records to Be Made by Certain Exchange
Members, Brokers, and Dealers/Records to Be Preserved by Certain
Exchange Members, Brokers, and Dealers [supcaret]
<bullet> SEA Rule 14e-4--Prohibited Transactions in Connection with
Partial Tender Offers ++
[[supcaret] FINRA shall not have any Regulatory Responsibilities for
these rules as they pertain to violations of insider trading
activities, which is covered by a separate 17d-2 Agreement by and
among Cboe BZX Exchange, Inc., Cboe BYX Exchange, Inc., NYSE Chicago,
Inc., Cboe EDGA Exchange Inc., Cboe EDGX Exchange Inc., Financial
Industry Regulatory Authority, Inc., MEMX, LLC, MIAX PEARL, LLC,
Nasdaq BX, Inc., Nasdaq PHLX LLC, The Nasdaq Stock Market LLC, NYSE
National, Inc., New York Stock Exchange, LLC, NYSE American LLC, NYSE
Arca Inc., and Investors' Exchange LLC and the Long-Term Stock
Exchange, Inc. as approved by the SEC on September 23, 2020, as may be
amended from time to time.]
** FINRA shall perform the surveillance responsibilities for the double
star rules. These rules may be cited by FINRA in both the context of
this Agreement and the Regulatory Services Agreement.
++ FINRA shall perform the surveillance responsibilities for SEA Rule
14e-4(a)(1)(ii)(D).
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing. Comments may be submitted by any of
the following methods:
Electronic Comments
<bullet> Use the Commission's internet comment form (<a href="http://www.sec.gov/rules/sro.shtml">http://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#f486819891d9979b9999919a8087b4879197da939b82"><span class="__cf_email__" data-cfemail="ec9e998089c18f8381818982989fac9f898fc28b839a">[email protected]</span></a>. Please include
File Number 4-700 on the subject line.
Paper Comments
<bullet> 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 4-700. 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 (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>).
Copies of the filing will be available for inspection and copying at
the principal office of FINRA and IEX. Do not include personal
identifiable
[[Page 23512]]
information in submissions; you should submit only information that you
wish to make available publicly. We may redact in part or withhold
entirely from publication submitted material that is obscene or subject
to copyright protection. All submissions should refer to file number 4-
700 and should be submitted on or before May 22, 2026.
V. Discussion
The Commission finds that the proposed Amended Plan is consistent
with the factors set forth in Section 17(d) of the Act \11\ and Rule
17d-2(c) thereunder \12\ in that the proposed Amended Plan is necessary
or appropriate in the public interest and for the protection of
investors, fosters cooperation and coordination among SROs, and removes
impediments to and fosters the development of the national market
system. In particular, the Commission believes that the proposed
Amended Plan should reduce unnecessary regulatory duplication by
allocating to FINRA certain examination and enforcement
responsibilities for Dual Members that would otherwise be performed by
FINRA and IEX. Accordingly, the proposed Amended Plan promotes
efficiency by reducing costs to Dual Members. Furthermore, because IEX
and FINRA will coordinate their regulatory functions in accordance with
the Amended Plan, the Amended Plan should promote investor protection.
---------------------------------------------------------------------------
\11\ 15 U.S.C. 78q(d).
\12\ 17 CFR 240.17d-2(c).
---------------------------------------------------------------------------
The Commission notes that, under the Amended Plan, IEX and FINRA
have allocated regulatory responsibility for those IEX rules, set forth
in the Certification, that are substantially similar to the applicable
FINRA rules in that examination for compliance with such provisions and
rules would not require FINRA to develop one or more new examination
standards, modules, procedures, or criteria in order to analyze the
application of the rule, or a Dual Member's activity, conduct, or
output in relation to such rule. In addition, under the Amended Plan,
FINRA would assume regulatory responsibility for certain provisions of
the federal securities laws and the rules and regulations thereunder
that are set forth in the Certification. The Common Rules covered by
the Amended Plan are specifically listed in the Certification, as may
be amended by the Parties from time to time.
According to the Amended Plan, IEX will review the Certification at
least annually, or more frequently if required by changes in either the
rules of IEX or FINRA, and, if necessary, submit to FINRA an updated
list of Common Rules to add IEX rules not included on the then-current
list of Common Rules that are substantially similar to FINRA rules;
delete IEX rules included in the then-current list of Common Rules that
no longer qualify as common rules; and confirm that the remaining rules
on the list of Common Rules continue to be IEX rules that qualify as
common rules.\13\ FINRA will then confirm in writing whether the rules
listed in any updated list are Common Rules as defined in the Amended
Plan. The Commission believes that these provisions are designed to
provide for continuing communication between the Parties to ensure the
continued accuracy of the scope of the proposed allocation of
regulatory responsibility.
---------------------------------------------------------------------------
\13\ See paragraph 2 of the Amended Plan.
---------------------------------------------------------------------------
The Commission is hereby declaring effective an Amended Plan that,
among other things, allocates regulatory responsibility to FINRA for
the oversight and enforcement of all IEX rules that are substantially
similar to the rules of FINRA for Dual Members of IEX and FINRA.
Therefore, modifications to the Certification need not be filed with
the Commission as an amendment to the Amended Plan, provided that the
Parties are only adding to, deleting from, or confirming changes to IEX
rules in the Certification in conformance with the definition of Common
Rules provided in the Amended Plan. However, should the Parties decide
to add an IEX rule to the Certification that is not substantially
similar to a FINRA rule; delete an IEX rule from the Certification that
is substantially similar to a FINRA rule; or leave on the Certification
an IEX rule that is no longer substantially similar to a FINRA rule,
then such a change would constitute an amendment to the Amended Plan,
which must be filed with the Commission pursuant to Rule 17d-2 under
the Act.\14\
---------------------------------------------------------------------------
\14\ The addition to or deletion from the Certification of any
federal securities laws, rules, and regulations for which FINRA
would bear responsibility under the Amended Plan for examining, and
enforcing compliance by, Dual Members, also would constitute an
amendment to the Amended Plan.
---------------------------------------------------------------------------
Under paragraph (c) of Rule 17d-2, the Commission may, after
appropriate notice and comment, declare a plan, or any part of a plan,
effective. In this instance, the Commission believes that appropriate
notice and comment can take place after the proposed amendment is
effective. The primary purpose of the Amended Plan is to add Securities
Exchange Act Rule 14e-4(a)(1)(ii)(D) to the Certification to
accommodate the upcoming launch of IEX's new options facility, to amend
the procedures regarding statutory disqualifications, and to make other
technical changes. The Commission notes that the prior version of this
plan immediately prior to this proposed amendment was published for
comment and the Commission did not receive any comments thereon.\15\
Furthermore, the Commission does not believe that the amendment to the
plan raises any new regulatory issues that the Commission has not
previously considered.
---------------------------------------------------------------------------
\15\ See Securities Exchange Act Release No. 93324 (October 14,
2021), 86 FR 58110 (October 20, 2021).
---------------------------------------------------------------------------
VI. Conclusion
This order gives effect to the Amended Plan filed with the
Commission in File No. 4-700. The Parties shall notify all members
affected by the Amended Plan of their rights and obligations under the
Amended Plan.
It is therefore ordered, pursuant to Section 17(d) of the Act, that
the Amended Plan in File No. 4-700, between FINRA and IEX, filed
pursuant to Rule 17d-2 under the Act, hereby is approved and declared
effective.
It is further ordered that IEX is relieved of those
responsibilities allocated to FINRA under the Amended Plan in File No.
4-700.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
---------------------------------------------------------------------------
\16\ 17 CFR 200.30-3(a)(34).
---------------------------------------------------------------------------
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2026-08474 Filed 4-30-26; 8:45 am]
BILLING CODE 8011-01-P
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