FINRA Requests Comments Regarding Pricing Information on Fixed Income Transactions (FINRA Reg. Notice 15-36)

FINRA requested comments on the revised version of a proposed rule that would require member firms to disclose additional information about customer confirmations for transactions in corporate and agency debt securities.

FINRA specified that it made changes to the proposal in response to comments received concerning FINRA Regulatory Notice 14-52. The changes include:

• replacing the "qualifying size" threshold with a retail customer account standard;
• permitting firms to use alternative methodologies for calculating the reference price for more complex trade scenarios;
• in the event of a material change in the price of the security between the time of the firm principal trade and the customer trade, permitting firms to omit the reference price;
• requiring a link to TRACE data on confirmations that are subject to the disclosure requirement;
• providing an exemption to the proposed disclosure requirements for transactions that are part of a fixed price new issue and are sold at the fixed price offering price;
• excluding firm principal trades that are executed on a trading desk functionally separate from the retail trading desk for purposes of calculating a reference price; and
• excluding firm principal trades with affiliates for positions that were acquired by the affiliates on a previous trading day.

Comments on the proposal must be submitted by December 11, 2015.