The Securities and Exchange Commission has again come to the aid of the equities market thanks to the COVID-19 crisis.
The regulator has decided to give market participants temporary relief from complying with the upcoming changes/revisions to reporting Rule 606 that were slated to go onto effect shortly.
The relief is as follows: one month for 606(a) compliance and two months for 606(b)(3) look through.
From the SEC:
“This order grants the following temporary exemptive relief from certain requirements of
Rule 606, which is set forth in greater detail below: (1) broker-dealers are exempt from the equirement to provide the public report covering the first quarter of 2020 required by Rule 606(a) until May 29, 2020; (2) broker-dealers that engage in outsourced routing activity are exempt from the requirement to collect the monthly customer-specific data required by Rule 606(b)(3) for such activity until June 1, 2020, and are exempt until July 29, 2020, from the requirement to provide a customer-specific report of June 2020 outsourced routing data within seven business days for customer requests for such customer-specific reports that are made on or before July 17, 2020.”
On November 2, 2018, the Commission adopted amendments to Rule 606 of Regulation
NMS under the Exchange Act. Under Rule 606(a), broker-dealers must provide quarterly,
aggregated public disclosure of their routing and handling of orders submitted on a held basis in NMS stock. In addition, under Rule 606(b) a broker-dealer must, upon request of its customer, provide customer-specific disclosures related to the routing and execution of the customer’s NMS stock orders submitted on a not held basis for the prior six months, subject to two de minimis exceptions.
The Commission previously revised the compliance dates for Rule 606 to provide brokerd ealers with additional time to implement the systems and other changes necessary to comply with Rule 606. On April 30, 2019, the Commission extended the compliance date for the amendments to Rule 606 to begin following September 30, 2019.
Then on September 4, 2019, the Commission, by the Division pursuant to delegated authority, granted temporary exemptions from amended Rule 606: (1) to all broker-dealers, from the requirement to collect the quarterly public data on held orders until January 1, 2020 (with the first quarterly report due by the end of April 2020); (2) to all broker-dealers that engage in self-routing activity, from the requirement to collect
the customer-specific monthly data for not held orders until January 1, 2020 (with the first customer-specific report of such data due seven business days after February 15, 2020, for tests made on or before February 15, 2020); and (3) to all broker-dealers that engage in outsourced routing activity, from the requirement to collect the customer-specific monthly data for not held orders until April 1, 2020 (with the first customer-specific report of such data due seven business days after May 15, 2020, for customer requests made on or before May 15, 2020)
