Wednesday, January 13, 2010

SEC Votes To Issue Proposed Rule, Concept Release On Broker-Dealer, Market Structure Issues

At an open commission meeting earlier today, the SEC voted to release for public comment a Proposed Rule aimed at banning a practice called "naked sponsored access," and requiring brokers with market access, including those who sponsor customers' access to an exchange, to put in place risk management controls and supervisory procedures, including procedures to help prevent erroneous orders, ensure compliance with regulatory requirements, and enforce pre-set credit or capital thresholds. See SEC press release: SEC Proposes New Rule to Effectively Prohibit Unfiltered Access and Maintain Market Access Controls. There will be a 60-day comment period on the Proposed Rule.

Also at today's SEC meeting, the commission voted to release for public comment a Concept Release seeking comment on market structure issues including high frequency trading, co-locating trading terminals, and markets that do not publicly display price quotations. See SEC press release: SEC Issues Concept Release Seeking Comment on Structure of Equity Markets. There will be a 90-day comment period on the Concept Release.

Additional information can be found in this Wall Street Journal article and Bloomberg article.

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