FINRA Proposes Rules To Implement New Securities Lending And Transparency Engine (SLATE™)

On May 1, 2024, the Financial Industry Regulatory Authority (FINRA) proposed a new Rule 6500 Series to implement its Securities Lending and Transparency Engine (SLATE"). The new rule series is mandated by Rule 10c-1a under the Securities Exchange Act of 1934 (Exchange Act), which was adopted by the U.S. Securities and Exchange Commission (SEC) on October 13, 2023.

This rule requires persons entering into securities loans (or their intermediary or reporting agent) to report specific terms of the loan to FINRA by the end of the day on which the loan is either effected or modified. Despite an ongoing legal challenge to the SEC rule in the U.S. Court of Appeals for the Fifth Circuit, FINRA published its proposed Rule 6500 Series within the four-month deadline initially set by the Commission in the adopting release for SEC Rule 10c-1a.