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RETAIL COMMUNICATION

Retail communication is defined as any written communication distributed or made available to 25 or more retail investors in a 30-day period. The communication may be distributed in hard copy or in electronic formats. The definition of a retail investor is any investor that does not meet the definition of an institutional investor. Retail communications now contain all components of advertising and sales literature. All retail communications must be approved by a registered principal prior to first use. The publication of a post in a chat room or other online forum will not require the prior approval of a principal so long as such post does not promote the business of the member firm and does not provide investment advice. Additionally, generic advertising will also be exempt from the prior approval requirements. All retail communication must be maintained by the member for three years. If the member firm is a new member firm that has been in existence for less than 12 months based on the firm's approval date in the central registration depository (CRD), the member must file all retail communications with FINRA 10 days prior to its first use unless the communication has been previously filed and contains no material changes or has been filed by another member, such as an investment company or ETF sponsor. Member firms that have been established for more than 12 months may file retail communications with FINRA 10 days after the communication is first used. Retail communications regarding investment companies, ETF sponsors, and variable annuities must be filed 10 days prior to first use if the communication contains nonstandardized performance rankings. Should FINRA determine that a member firm is making false or misleading statements in its retail communications with the public, FINRA may require the member to file all of its retail communications with the public with the association 10 days prior to its first use.

TAKENOTE!

Research reports concerning only securities listed on a national securities exchange are excluded from Rule 2210's filing requirements. Additionally, a free writing prospectus is exempt from filing with the SEC and not subject to Rule 2210's filing or content standards.

 
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