FINRA Rule 5110 (the "Corporate Financing Rule—Underwriting Terms and Arrangements") (formerly NASD Rule 2810) requires a member that participates in certain types of public offerings to file documents and information with FINRA about the underwriting terms and arrangements. FINRA’s Corporate Financing Department reviews this information prior to the commencement of the offering to determine whether the underwriting compensation and other terms and arrangements meet the requirements of the applicable FINRA rules. This review is not of the offering; it relates solely to the FINRA rules governing underwriting terms. A member may proceed with a public offering only if FINRA has provided an opinion that it has no objection to the proposed underwriting terms.
Speaking very generally, the Corporate Financing Rule is intended to protect issuers (and, indirectly, investors in those issuers) from bearing the costs of excessive compensation paid by an issuer to a FINRA member in connection with an underwriting.
The requirements of FINRA Rule 5110 overlap, to a good extent, with those of FINRA Rule 5121 (Conflicts in Public Offerings), which is the subject of a separate page. See also FINRA Private Placement Rule 5122 (Conflicts in Private Offerings) and FINRA Rule 5123 (Private Placements).