Proposed Rule Change to Expand Trading Halt Authority Based on Actions of Non-U.S. Regulators

FINRA has filed with the SEC the attached proposed rule change to amendFINRA Rule 6440 (Trading and Quotation Halt in OTC Equity Securities) with respect to halts by foreign regulatory authorities. The rule change would provide that FINRA may:

(1) initiate a trading and quotation halt in an OTC Equity Security upon notice of a foreign regulatory halt for news pending, including notice from a reliable third-party source;(2) continue to halt trading and quoting in such OTC Equity Security until notice from the appropriate foreign regulatory authority is received that it has or intends to resume trading in the security, even if such halt is longer than 10 business days; and (3) extend a halt initiated under Rule 6440(a)(3) for an extraordinary event beyond 10 business days if it determines that the basis for the halt still exists.

Click hereto view text of proposed rule change (links externally to FINRA website).For a general discussion of the regulators' authority to impose trading suspensions, halts and delays, see Lofchie's Guide to Broker-Dealer Regulation,Trading Chapter, Section VII.