The US fixed-income markets have changed dramatically over the past several decades. The amendments to Rule 15c2-11 that went into effect in September 2021 are designed to further modernize the Rule and to enhance investor protection by requiring that current and publicly available issuer information be accessible to investors. And the specified phased-in approach should allow for brokers or dealers that publish or submit quotations for fixed income securities in a quotation medium to achieve the goals of Rule 15c2-11, and are summarised as:
Phase 1 – the fixed income security or its issuer meets one of the criteria in Appendix A, or that there is current and publicly available financial information (consistent with Rule 15c2-11(b)) about the issuer. Phase 1 will be in place for a one-year period (from January 3, 2022 until, and including, January 3, 2023).
Phase 2 – the fixed income security or its issuer meets one of the criteria in Appendix B, or there is current and publicly available financial information (consistent with Rule 15c2-11(b)) about the issuer. Fixed income securities sold pursuant to Rule 144A that do not otherwise meet the criteria in Appendix B would no longer qualify for Phase 2 unless the broker or dealer determines that there is current and publicly available information (consistent with Rule 15c2-11(b)) about the issuer. Phase 2 will be in place for a one year period (from January 4, 2023 until, and including, January 4, 2024).
Phase 3 – the fixed income security qualifies for Phase 2 and: (1) the fixed income security is foreign sovereign debt or a debt security guaranteed by a foreign government; or (2) there is a website link, on the quotation medium on which the security is being quoted, directly to the current and publicly available information about the issuer (consistent with Rule 15c2-11(b)), provided that the broker or dealer has determined at least on an annual basis that the website link and its underlying information is current (“Phase 3”). Phase 3 commences at the expiration of Phase 2 (on or after January 5, 2024).
If you are a Broker or Dealer that is navigating Rule 15c2-11 and are looking for professional solutions to support your development of effective compliance programs to ensure your firm complies with the Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA), please contact Jace Olander to discuss your consulting options.
Jace Olander | Associate Partner | Head of Danos Consulting U.S.
T: + 1 212 600 4807 | E: firstname.lastname@example.org
As a specialist consultancy firm for the Financial Services sector, Danos Consultancy has an unparalleled talent network, and can provide experienced, first-class practitioners cost-effectively.