FINRA Proposes Amendments on Timing under TRACE

FINRA proposed to modify the timing of Trade Reporting and Compliance Engine ("TRACE") reporting requirements for transactions in U.S. Treasury Securities. The amendments to FINRA Rule 6730 ("Transaction Reporting") concern both increments of time reported and the time of reporting.

Under the proposal, FINRA members would be required to: (i) report Treasury transactions to TRACE in the finest increment of time captured by the system used to execute the transaction (though this requirement would not apply to those firms that average less than $10 million dollars of trade a day); and (ii) report Treasury transactions as soon as practicable, and if executed when TRACE is open, no later than 60 minutes after execution. Trades done when TRACE is closed would generally be required to be reported within 60 minutes after TRACE reopens.

FINRA proposed that the effective date of the new TRACE reporting requirements would be up to 365 days following publication of a Regulatory Notice announcing SEC approval of the amendment.