FINRA Amended Trade Reporting Rules Effective August 3, 2009

On November 5, 2008, the Securities and Exchange Commission ("SEC") approved the proposal from the Financial Industry Regulatory Authority, Inc. ("FINRA") to overhaul the trade reporting structure for over-the-counter ("OTC") equity transactions and to implement additional non-tape reporting requirements (the "Trade Reporting Rules"). The SEC's approval was published in the Federal Register on November 17, 2008.¹ On January 23, 2009, FINRA published Regulatory Notice 09-08, announcing that the amendments are scheduled to go effective August 3, 2009.²

The SEC approved the Trade Reporting Rules substantially as proposed. As adopted, the rules: (1) replace the "market maker" and sell-side based OTC equity trade reporting structure with an executing-broker based reporting structure; and (2) require the member firm with the trade reporting obligation in connection with a transaction executed in a dual agency or a riskless principal capacity on behalf other member firms to