FINRA’s Adopts Electronic Form 211 for FINRA Rule 6432 Compliance

The Financial Industry Regulatory Authority (FINRA) has adopted a new electronic Form 211 for purposes of compliance with FINRA Rule 6432 (Compliance with the Information Requirements of SEA Rule 15c2-11).  FINRA member firms must begin using the electronic Form 211, in place of the current paper form, beginning on October 23, 2017, but they may voluntarily begin using the electronic Form 211, beginning on September 11, 2017.

By way of background, FINRA Rule 6432 prescribes the method by which firms must demonstrate to FINRA that they are in compliance with SEA Rule 15c2-11.  To that end, Rule 6432 generally provides that no FINRA member shall initiate, or resume quotations in a non-exchange-listed security, unless the member demonstrates that they are in compliance by making a filing with, and in the form required by, FINRA (“Form 211”).  FINRA had previously required firms to comply with Rule 6432 by submitting a paper Form 211, which is being now being replaced with the new electronic Form 211.

The new electronic Form 211 is accessible through the FINRA Gateway, and consists of a cover page and five sections.  Those section include: (1) issuer and security information; (2) information  required pursuant to SEA Rule 15c2-11(a)(1), (a)(2), (a)(3), (a)(4) or (a)(5), as applicable; (3) information required pursuant to paragraphs (b)(1) through (b)(3) of SEA Rule 15c2-11; (4) supplemental information; and (5) the certification.  The electronic Form 211 generally solicits the same information that is currently requested in the paper form, and permits firms to upload, or reference (if available on the SEC’s Electronic Data Gathering, Analysis, and Retrieval system), all requested information, along with any supplemental information a firm may wish to submit.

Beginning on October 23, 2017, FINRA will no longer accept the paper Form 211; thus, will be allowed to continue to use the paper Form 211 until that time.  However, member firms can voluntarily transition to the new electronic Form 211, beginning on September 11, 2017.