FINRA Unlisted Securities Policy

On Sep. 14, FINRA proposed to amend assignment of OTC symbols.

  • FINRA published regulatory notice 21-32, requesting comment on a proposed change to its policy relating to the assignment of OTC symbols to unlisted equity securities.
  • In consideration of whether it should begin assigning OTC symbols to unlisted equity securities without a valid CUSIP identifier in limited and documented circumstances.
  • Aims to facilitate firms' compliance, enhance transparency, more accurate audit trail.
  • Policy Amendments
  • Firms required by FINRA to report trades in OTC equity securities and restricted equity securities effected pursuant to securities act (SRT) Rule 144A, in 17 CFR 230.144A.
  • Changes under consideration to permit the assignment of OTC symbols to OTC equity securities and Rule 144A restricted equity securities without a valid CUSIP identifier.
  • Considered in limited circumstance where a member firm demonstrates its best efforts to obtain a CUSIP identifier, as well as provides documentation to identify the security.
  • Those requesting OTC symbols for such securities would be required to document best efforts to obtain CUSIP identifier; data sufficient to identify and categorize a security.
  • Comment Request
  • Feedback requested by FINRA on the proposed policy, and on specific listed questions.
  • Questions on other types of OTC securities without a CUSIP identifier to apply rule to.
  • Whether OTC trade without CUSIP should be publicly distributed, concerns, mitigation.
  • Should they be denoted with additional character; any additional factors to consider.
  • Alternatives; unintended consequences of proposal; costs or benefits; due diligence.
  • Effectiveness
  • Comments on the proposed policy change required to be submitted by Nov. 15, 2021.

Regulators FINRA
Entity Types B/D; Exch; IA
Reference RN 21-32, RFI, RF, 9/14/2021; SRT; Citation: 17 CFR 230.144A;
Functions Compliance; Operations; Product Administration; Reporting; Trade Reporting; Trading
Countries United States of America
Products Derivatives; Equity; Securities
Regions Am
Rule Type Proposed
Rule Date 9/14/2021
Effective Date 11/15/2021
Rule Id 116014
Linked to N/A
Reg. Last Update 9/14/2021
Report Section US Investment

Last substantive update on 09/16/2021