FINRA Alert Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Amend FINRA Rule 6120 (Trading Halts) to Conform to Recent Amendments to the SIP Plans and to Make Technical and Clarifying Changes to the Rule
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Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Amend FINRA Rule 6120 (Trading Halts) to Conform to Recent Amendments to the SIP Plans and to Make Technical and Clarifying Changes to the Rule
Comments due:ย 21 days after publication in the Federal RegisterAdditional Materials: Exhibit 5
- Submit Comments on SR-FINRA-2022-016
Specifically, Rule 6120(a)(3) provides that FINRA shall close the Alternative Display Facility (โADFโ)5 or any Trade Reporting Facility (โTRFโ)6 to quotation or trade reporting activity, as applicable, whenever the ADF or TRF is unable to transmit real-time trade reporting information to the applicable Securities Information Processor (SIPโ).7 If the ADF or any TRF closes pursuant to this provision, members are not prohibited from trading through other markets for which trading is not halted.8
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Among other things, the SIP Plan Amendments updated and clarified the process for Regulatory Halts under the SIP Plans. Under the SIP Plan Amendments, the Primary Listing Market may also declare a Regulatory Halt in any security for which it is the Primary Listing Market,11 as provided for in the rules of the Primary Listing Market, if it determines that there is a SIP Outage,12 Material SIP Latency,13 Extraordinary Market Activity,14 or in the event of national, regional, or localized disruption that necessitates a Regulatory Halt to maintain a fair and orderly market.15 The SIP Plan Amendments also clarified that the start time of a Regulatory Halt is when the Primary Listing Market declares the halt, regardless of whether an issue with communications impacts the dissemination of the notice.16 For Regulatory Halts other than SIP Halts, the Primary Listing Market will declare the resumption of trading when it determines that trading may resume in a fair and orderly manner and in accordance with its rules.17 Where such a Regulatory Halt is initiated by another Participant that is a Primary Listing Market, a Participant may resume trading after the Participant receives notification from the Primary Listing Market that the Regulatory Halt has been terminated.18 For SIP Halts, the Primary Listing Market will terminate the halt with a notification that specifies a SIP Halt Resume Time.19
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