Federal Register: SEC Adopts "Retail Best Interest" Rulemaking Package
The SEC rulemaking package designed to enhance retail investors' protections when dealing with broker-dealers and investment advisers was published in the Federal Register.
The rulemaking package consists of (i) Regulation Best Interest (effective September 10, 2019), (ii) the Form CRS Relationship Summary (effective September 10, 2019), (iii) an interpretation of investment advisers' fiduciary duty (effective July 12, 2019), and (iv) an interpretation of the "solely incidental" prong of the broker-dealer exclusion under the Advisers Act (effective July 12, 2019).
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SEC Commissioner Hester Peirce urged critics "to take a fair look at what [Regulation Best Interest] says before . . . proclaim[ing] it a success or failure" and committed the agency to closely monitoring the implementation of the new rule.
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The SEC adopted a rulemaking package designed to enhance retail investors' protections when dealing with broker-dealers and investment advisers.
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The SEC proposed rules (i) to require broker-dealers to act in the "best interests" of retail customers when making investment recommendations and (ii) to affirm and clarify the various types of obligations that investment advisers owe to their clients.