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Regulatory Insights - July 2021

Your source for the latest updates from the SEC and across the industry.


Your source for the latest updates from the SEC and across the industry.

CONTENTS

SEC LEADERSHIP CHANGES

  • Daniel S. Kahl appointed Acting Director of the Division of Examinations; Peter B. Driscoll to depart agency
  • SEC appoints New Jersey Attorney General Gurbir S. Grewal as Director of Enforcement
  • SEC Chair Gary Gensler announces composition of policy team

REGULATORY INITIATIVES

  • NYSE Fee Schedule Oversight and Gifted Share Petitions
  • FINRA Regulatory Notices on digital assets, the margin rule regarding minimum equity, effective methods to educate newer investors, and best execution and payment for order flow

CRYPTOCURRENCY

  • SEC order to review listing and trading Bitcoin Trust on CboeBZX Exchange, Inc.
  • SEC Cryptocurrency Enforcement Action

ESG

  • SEC Chair Gary Gensler gives address at London City Week
  • July Asset Management Advisory Committee meeting
  • European Commission delays application date for SFDR disclosure rules
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SEC LEADERSHIP CHANGES

SEC appoints New Jersey Attorney General Gurbir S. Grewal as Director of Enforcement

Grewal currently serves as Attorney General for the State of New Jersey, a role he has held since January 2018.

Read the press release.

Daniel S. Kahl appointed Acting Director of the Division of Examinations; Peter B. Driscoll to depart agency

Peter B. Driscoll, the Director of the Division of Examinations, will depart the agency effective Aug. 14. Daniel Kahl, the Division's Deputy Director, will be named Acting Director upon Mr. Driscoll's departure.

Read the press release.

SEC Chair Gary Gensler announces composition of policy team

On July 16 the SEC announced the appointments of Corey Klemmer, Adam Large, Mika Morse, Sirimal Mukerjee, and Sai Rao to Chair Gary Gensler's policy staff, led by the Policy Director Heather Slavkin Corzo.

Read the press release.


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REGULATORY INITIATIVES

NYSE Fee Schedule Oversight – extended to August 18, 2021

The SEC Commission extended their review of the NYSE petition to shift oversight of the regulated proxy and interim fee schedule to FINRA. This was done to further review the proposed change, the issues raised in comment letters and the NYSE’s response.

Read the SEC order.

NYSE Gifted Shares Proposal – extended to August 15, 2021

The SEC Commission extended their review of the NYSE petition to prohibit certain brokers from seeking reimbursement, in certain circumstances (e.g., gifted shares), from issuers for forwarding proxy and other materials to beneficial owners. This was done to further review the proposed change, the issues raised in comment letters and the NYSE’s response.

Read the SEC order.

Recent FINRA Notices

  • On July 8, FINRA published Regulatory Notice 21-25, “FINRA Continues to Encourage Firms to Notify FINRA if They Engage in Activities Related to Digital Assets”

    Read the full regulatory notice.

  • On July 2, FINRA published RN 21-24, “FINRA Announces Updates to the Interpretations of FINRA’s Margin Rule Regarding Minimum Equity”

    Read the full regulatory notice.

  • On July 2 FINRA published Special Notice – 6/30/21: “Requests Comment on Effective Methods to Educate Newer Investors”

    Comment period expires on August 30, 2021.

    Read the full special notice.

  • On June 23, FINRA published RN-21-23, “FINRA Reminds Member Firms of Requirements Concerning Best Execution and Payment for Order Flow”

    Read the full regulatory notice.


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CRYPTOCURRENCY

SEC order to review listing and trading Bitcoin Trust on CboeBZX Exchange, Inc.

On June 16 the SEC published an order instituting proceedings to determine the approval or disapproval of a proposed rule change to list and trade shares of the VanEck Bitcoin Trust on the CboeBZX Exchange, Inc. In the order, the SEC requested comments, including whether the trust and shares would be susceptible to manipulation and whether the risks of manipulation have been mitigated sufficiently.

Read the order in its entirety.

SEC Cryptocurrency Enforcement Action

On July 14 the SEC announced a settlement with UK-based Blotics LTs, the operator of Coinschedule.com, for failing to disclose payments from issuers of the digital asset securities it profiled.

Read the press release and order.

Read the public statement of Commissioners Hester M. Peirce and Elad L. Roisman.


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ESG

SEC Chair Gary Gensler gives address at London City Week

On June 23 SEC Chair Gary Gensler gave a speech at London City Week covering ESG and public company disclosures, LIBOR, markets and payment for order flow.

Read the Chair’s speech in its entirety.

July Asset Management Advisory Committee (AMAC)

The Asset Management Advisory Committee met on July 7. The meeting included a discussion of matters in the asset management industry relating to:

  • The ESG, Diversity & Inclusion, and Private Investments subcommittees, including potential recommendations from those subcommittees.
  • The Evolution of Advice subcommittee, including a panel discussion.

Read the press release including the agenda.

Read SEC Chair Gary Gensler’s remarks.

Read Commissioner Hester M. Peirce’s remarks.

European Commission delays application date for SFDR disclosure rules

The European Commission will defer by six months the application date of detailed rules for requirements under the sustainable finance disclosure regulation (SFDR), according to a letter from John Berrigan, director general for the Commission’s financial services division.

  • The letter informed the European Parliament and Council that the Commission had not been able to hit the deadline for adopting draft regulatory technical standards (RTS) submitted by the European Supervisory Authorities (ESAs) in February “given their length and technical detail, which requires additional time in the adoption process."
  • The ESAs are still working on the detailed rules for taxonomy-related disclosure requirements, which are supposed to amend the SFDR RTS from February.

This newsletter is not intended as legal advice. Broadridge recommends you contact your legal counsel for a complete understanding of the information contained in this publication.

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