SEC Narrows Exemption From Section 15(b)(8) of the Securities Exchange Act

The Securities and Exchange Commission today amended rule 15b9-1, which provides an exemption from Section 15(b)(8) of the Securities Exchange Act of 1934, so that fewer broker-dealers can be exempt from national securities association registration. The purpose of this amendment is to ensure that all broker-dealers, regardless of their trading volumes, have a consistent oversight system in place. The amendments will require brokers and dealers who do not carry customer accounts and are members of at least one exchange to register with a national securities association if they effect off-member-exchange securities transactions solely for the purpose of executing the stock leg of a stock-option order, or if the trades are resulting from orders that are routed by a member exchange in order to comply with order protection regulatory requirements. The final rule becomes effective 60 days after the release of the adopting announcement in the Federal Register, with the compliance date being 365 days from the release date.