21 February, 2023
Working Group Update 2/21/2023
21 February, 2023
- SEC Order Competition Rule Proposal. Members of the Data and Technology Committee, the Front Office Committee and the Compliance and Surveillance Working Group continued their discussion of the SEC’s Order Competition Rule proposal, including auction priority rules, the need to ensure sufficient auction capacity before auctions are introduced in production, unsuccessful auctions, attribution of the originating broker, and requirements for the originating broker to maintain anonymity.
- FIF Rule 605 Working Group. The Rule 605 Working Group continued its discussion of the SEC’s recent rule proposal on Disclosure of Order Execution Information, with a focus on the summary execution report, including weighting methods, the limitations of the report, additional information to be included in the report, and the alternative of the SEC providing a query tool for investors.
- FIF CAT Transaction Reporting Working Group. The CAT Transaction Reporting Working Group discussed issues and questions from FIF members on CAT reporting when a pre-execution verbal order is followed by a post-execution electronic order, reporting for the transfer of fractional share positions between firm accounts, reporting a customer change to a trading session instruction, and linkage errors for partial cancels. The Working Group discussed firm compliance processes for CAT, including FINRA Regulatory Notice 20-31 (“FINRA Reminds Firms of Their Supervisory Responsibilities Relating to CAT”) and the compliance guidance for CAT on the FINRA website.
- FIF CAT CAIS Working Group. The Working Group discussed the CAIS annual refresh process. The Working Group reviewed and edited draft FIF members comments and questions for FINRA CAT on FAQ Q71 (reporting for an FDID that has multiple CAT Customers with the same TID value) and the scenario where a firm resubmits the same FDID and receives the same rejection over a period of days. The Working Group continued its discussion of CAIS open issues, including the implementation of Full CAIS, closed accounts that have CAIS errors, CAIS reporting for employees of government entities, CAT Transaction Reporting rejections in the scenario where a firm reports an FDID that has been rejected by CAIS, making the FDID reconciliation report available through SFTP, duplicative errors generated by the CAIS system, and Material Inconsistencies processed by the CAIS system as errors.
Eduard Kotlyar