SEC approves NASD and NYSE uniform branch office definition for broker‐dealers

Abstract

Purpose

To describe and to discuss the implications of the new National Association of Securities Dealers, Inc. (NASD) and New York Stock Exchange (NYSE) uniform branch office definition for broker‐dealers, approved on September 9, 2005, as found in the definitions of “branch office” found in NASD Conduct Rule 3010(g)(2) and NYSE Rule 342 (the “Adopted Rules.”)

Design/methodology/approach

Summarizes and analyzes the adopted rules.

Findings

The adoption of a single standard by NASD, the NYSE, and state law authorities will be welcome to broker‐dealers that have to date been operating under a number of varying definitions. The Adopted Rules define “branch office” very broadly, but contain important exclusions to the uniform definition such as the primary residence exclusion and exlusions for locations of limited use, locations of convenience, and locations used for other than securities business. Unfortunately, the SEC approval orders contain no discussion of how these rules might apply to the international networks that include US broker dealers.

Originality/value

A useful summary and analysis of the new uniform branch office definition, which comes at a time when US securities regulators are placing increasing emphasis on branch office supervision, control, and inspection.

Citation

Gittleman, C.S. and Sacks, R.D. (2005), "SEC approves NASD and NYSE uniform branch office definition for broker‐dealers", Journal of Investment Compliance, Vol. 6 No. 2, pp. 4-9. https://doi.org/10.1108/15285810510644884