FINRA Proposes Amendments to Expand Eligibility to Serve as Non-Public Arbitrators

FINRA proposed amendments to the Arbitration Rules (FINRA Rules 12100 and 13100) to expand the scope of individuals eligible to serve as non-public arbitrators. Under the proposal, individuals who meet certain general eligibility criteria to serve as arbitrators, but are excluded from serving as "public" arbitrators due to a disqualifying connection to the securities industry, would be able to serve as "non-public" arbitrators.

FINRA is proposing the rule amendment to address a gap in eligibility created by a 2015 amendment to the arbitrator definitions which excluded a significant number of individuals from being eligible to serve as non-public arbitrators even though they met the general arbitrator eligibility criteria.