Comment Deadline Set for SEC Proposal to Establish Best Execution Framework

Comments on an SEC proposal to establish a best execution regulatory framework for broker-dealers, government securities broker-dealers and municipal securities dealers ("Covered Entities") are due by March 31, 2023. The Notice was published in the Federal Register.

As previously covered, the proposal would require Covered Entities to enforce written policies and procedures designed to comply with the best execution standard. Such policies and procedures would be required to be reviewed at least annually and Covered Entities would be required to preserve records made pursuant to proposed Regulation Best Execution. Covered Entities would be exempt from the requirements of Regulation Best Execution in such instances where (i) another Covered Entity is executing a customer order against the Covered Entity's quotation; (ii) an institutional customer, exercising independent judgment, executes its order against the Covered Entity's quotation; or (iii) the Covered Entity receives unsolicited instruction from a customer to route the customer's order to a particular market for execution and the Covered Entity complies with certain related conditions.