SEC Publishes Concept Release on Market Structure, Proposes Risk Management Rules for Sponsored Access
By: Mark D. Perlow and C. Dirk Peterson
On January 14, 2010, the Securities and Exchange Commission (SEC) voted to issue a concept release intended to elicit public comment on a broad range of questions relating to the efficiency and fairness of the public equity markets (the "Concept Release"). The Concept Release revisited issues that the SEC raised and addressed nearly five years ago in a comprehensive set of market, trading and reporting rules codified in Regulation NMS. Shortly after publishing the Concept Release, the SEC also published a release proposing a new risk management rule requiring firms that sponsor trading access to exchanges and alternative trading systems (ATSs) to establish (and periodically evaluate) a system of controls intended to limit potential financial exposure and to ensure compliance with relevant regulatory requirements (the "Sponsored Access Release"). These recent market-structure initiatives form part of the SEC's ongoing review of the equity markets and follow two discrete SEC rule-making initiatives from 2009 currently under consideration.
To read the complete alert online, click here.
