Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Tuesday, April 29, 2008

FINRA Proposes Amendments to Options Communications Rule

The SEC has released for public comment FINRA's proposed amendment of NASD Rule 2220 (Options Communications with the Public), which FINRA says is being revised to better address current needs for regulating options communications practices and promote consistency across the options communications rules of other self-regulatory organizations ("SROs").  FINRA explains that it, along with other SROs, have sought to modernize their rules concerning options communications with the public. One of the goals of this rule modernization is to make the rules on options communications consistent with the general rules on communications with the public. To this end, FINRA proposes to: (1) use, to the extent appropriate, the same terminology and definitions as in its general communications rules; (2) make the requirements for principal review of correspondence concerning options the same as for correspondence generally; and (3) update the standards on the content of communications that precede the delivery of the options disclosure document ("ODD").

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