Federal Register #SR-FINRA-2026-007

SEC Notice: Proposed Amendments to FINRA Rules for Collective Trust Funds and DTC Rule Harmonization

This notice outlines proposed regulatory amendments by the Securities and Exchange Commission (SEC) impacting investment vehicles and clearing agency procedures: - Government Buyer: - Securities and Exchange Commission (SEC), Division of Trading and Markets - OEMs and Vendors: - Financial Industry Regulatory Authority, Inc. (FINRA) - Depository Trust Company (DTC) - National Securities Clearing Corporation (NSCC) - Fixed Income Clearing Corporation (FICC) - Products/Services Requested: - Amendment to FINRA Rules 5130 and 5131 to exempt specified collective trust funds (CTFs) from new issue allocation restrictions, enabling CTFs with 1,000+ plan participants to invest in IPOs more easily - Corrections and clarifications to DTC Rules and Procedures to harmonize with NSCC and FICC, improving transparency and consistency - Unique or Notable Requirements: - No physical products or part numbers are being procured; the focus is on regulatory changes - The amendments are designed to reduce regulatory burdens for CTFs, expand retirement plan access to IPOs, and enhance market efficiency - Safeguards are included to prevent circumvention of existing restrictions - The SEC is soliciting public comments on these proposed changes

Description

The Financial Industry Regulatory Authority (FINRA) has filed a proposed rule change with the Securities and Exchange Commission (SEC) to amend FINRA Rules 5130 and 5131. The amendment aims to exempt specified collective trust funds (CTFs) from certain restrictions on the purchase and sale of initial equity public offerings and new issue allocations. This change is intended to reduce regulatory burdens on CTFs, expand investor access to IPOs through retirement investments, and promote capital formation while maintaining safeguards against circumvention of existing rules.

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