On February 24, acting Chair of the Securities and Exchange Commission Allison Herren Lee issued a statement that she has directed the Division of Corporation Finance (the “Staff”) to focus on climate-change disclosures in public company filings. Referencing the SEC’s guidance on climate-change disclosure previously issued in 2010, she stated that the Staff will begin reviewing climate-change disclosures to evaluate compliance with the guidance and disclosure obligations under the federal securities laws, engaging with public companies and considering how the market is managing climate-related risks. In her statement, Chair Lee emphasized that investors are increasingly considering climate-related issues in making their investment decisions, and that it is the SEC’s duty to make sure that investors have access to material information when making those decisions. Continue Reading Acting SEC Chair Issues Statement on Climate-Change Disclosures

In response to a recent request by the Financial Industry Regulatory Authority (FINRA), the Securities and Exchange Commission has issued an order (the Order) designed to ease potential burdens that smaller broker-dealers may face in obtaining audit services. Rule 17a-5(d)(1)(i) of the Securities Exchange Act of 1934 (Exchange Act) requires that, unless a broker meets an available exception under the rule, every broker or dealer registered under Exchange Act Section 15 must file annually reports. Pursuant to the Exchange Act rules, the annual reports must be filed not more than 60 calendar days after the end of the fiscal year of the broker or dealer. The Order permits specified FINRA members an additional 30 calendar days for filing their annual reports as required pursuant to Exchange Act Rule 17a-5(d), subject to certain conditions. The limited conditions include, among others, if such member (1) was in compliance with Rule 15c3-1; and (2) had total capital and allowable subordinated liabilities of less than $50 million, as reported in box 3530 of Part II or Part IIA of its FOCUS Report.

The Order is immediately effective, and any FINRA members that wish to avail themselves of the extension must provide notification to FINRA.

FINRA Regulatory Notice

Effective February 24, and in response to the ongoing challenges posed by the COVID-19 pandemic, the Financial Industry Regulatory Authority (FINRA) is providing an interim accommodation to allow candidates to take additional FINRA exams online, including the Series 24, Series 57, Series 79 and Series 99 exams. An interim accommodation request is not required for the Securities Industry Essentials (SIE), Series 6 or Series 7 exams, which have been available online for all candidates since mid-July 2020. Continue Reading FINRA Provides Additional FINRA Exams Online

Pursuant to a Securities and Exchange Commission order, the Financial Industry Regulatory Authority (FINRA) established an accounting support fee to fund the annual budget of the Governmental Accounting Standards Board (GASB). Each quarter, FINRA collects a quarter of the annual GASB accounting support fee from its member firms. Each member firm’s assessment is based on its portion of the total par value of municipal securities transactions reported to the Municipal Securities Rulemaking Board by all FINRA members in the previous calendar quarter.

FINRA Regulatory Notice 21-06

On February 22, the European Securities and Markets Authority (ESMA) published its final report on guidelines to clarify common procedures and methodologies for the supervisory review and evaluation process of central counterparties (CCPs) by their national competent authorities (NCAs) (the Report).

The proposed guidelines addressed in the Report by ESMA include: Continue Reading ESMA Publishes Guidelines on Supervisory Review and Evaluation Process of CCPs

On February 12, the Financial Industry Regulatory Authority (FINRA) issued Regulatory Notice 21-04 (Notice), in connection with an amendment to FINRA’s Codes of Arbitration Procedure for Customer and Industry Disputes, regarding certain fees paid to arbitration chairpersons. FINRA Rules 12214 and 13214 were amended to increase the hearing-day chairperson fee from $125 to $250 to better compensate the chairperson for the additional training and responsibilities required of the position. Additionally, the amendments establish a new chairperson fee for an additional $125 for each prehearing conference that the chairperson leads, even if an arbitration case closes without a hearing. Continue Reading FINRA Amends Arbitration Codes to Increase Arbitrator Chairperson Fees and Certain Arbitration Fees

On February 16, the Financial Industry Regulatory Authority (FINRA) issued an Information Notice (Notice) regarding a new fee rate applicable to specified securities transactions on the exchanges and in the over-the-counter markets. Such fee rate will decrease from its current rate of $22.10 per million dollars in transactions to a new rate of $5.10 per million dollars in transactions. Continue Reading New Rate for Fees Paid Under Section 31 of the Exchange Act

On February 15, the Council of the European Union (the Council) published a press release announcing the adoption of a “quick fix” amendment to the revised Markets in Financial Instruments Directive (MiFID II) in response to the economic impact caused by the COVID-19 pandemic (the Amendment).

The key changes to MiFID II in the Amendment include: Continue Reading MiFID II “Quick Fix” Adopted in Response to COVID-19

On February 17, the European Commission (the Commission) published two Delegated Regulations amending the European Market Infrastructure Regulation (EMIR) Margin Regulatory Technical Standards (RTS) and the Clearing Obligation RTS (the Delegated Regulations).

The key amendments proposed by the Commission in the Margin RTS include: Continue Reading European Commission Publishes Delegated Regulations Under EMIR on Risk Mitigation and Clearing Obligation

On February 8, the staff of the SEC’s Division of Corporation Finance (the Staff) published a sample comment letter that the Staff might send to companies that conduct securities offerings during periods of extreme stock price volatility. Continue Reading SEC Staff Releases Sample Comment Letter on Securities Offerings During Periods of Market and Price Volatility