The Division has prepared this guidance to assist the national securities exchanges and FINRA (hereafter, “SROs”) in preparing Fee Filings that meet their burden to demonstrate that proposed fees are consistent with the requirements of the Securities Exchange Act of 1934 (“Exchange Act”), and rules thereunder. The Exchange Act provides that a proposed rule change may not take effect unless it is approved by the Commission pursuant to Exchange Act Section 19(b)(2), or it becomes immediately effective upon filing pursuant to Exchange Act Section 19(b)(3)(A). Rule 19b-4(f) under the Exchange Act specifies the types of proposed rule changes that may become immediately effective upon filing with the Commission, and includes those properly designated by the SROs as “establishing or changing a due, fee, or other charge imposed by the self-regulatory organization.” Whether filed for Commission approval or immediate effectiveness, all proposed rule changes, including proposed fee changes, are required to be consistent with the Exchange Act.
This guidance discusses several aspects of Fee Filings, with a focus on how SROs can ensure that they have clearly described their proposed fees and addressed how they satisfy Exchange Act requirements that, among other things, fees be (i) reasonable, (ii) equitably allocated, (iii) not unfairly discriminatory, and (iv) not an undue burden on competition.
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