SEC Chairman Confirms June 30 Compliance Date for Regulation Best Interest and Form CRS
On June 15, 2020, SEC Chairman Jay Clayton released a public statement confirming the June 30, 2020 compliance date for Regulation Best Interest (Reg BI) and Form CRS. Reg BI establishes a new standard of conduct for broker-dealers when making a recommendation of any securities transaction or investment strategy (including account recommendations) to a retail customer. Form CRS is a disclosure document applicable to broker-dealers and registered investment advisers with retail investors, and is meant to reduce investor confusion about fees, conflicts of interest and the required standard of conduct for a particular firm. In his remarks, Mr. Clayton noted the SEC had engaged extensively over the past year with broker-dealers, investment advisers, market participants and regulatory partners such as FINRA, regarding the implementation of Reg BI and Form CRS. Based on the considerable progress observed, Mr. Clayton reiterated an earlier position from April 2020 that the June 30, 2020 compliance date for both rules was appropriate. Mr. Clayton further noted that the SEC’s work over the past several months had strengthened his view that the effects of the COVID-19 pandemic weighed substantially in favor of implementing Reg BI and Form CRS requirements as soon as practicable.
Chairman Clayton’s public statement is available here.
Vedder Thinking | Articles SEC Chairman Confirms June 30 Compliance Date for Regulation Best Interest and Form CRS
Newsletter/Bulletin
July 6, 2020
On June 15, 2020, SEC Chairman Jay Clayton released a public statement confirming the June 30, 2020 compliance date for Regulation Best Interest (Reg BI) and Form CRS. Reg BI establishes a new standard of conduct for broker-dealers when making a recommendation of any securities transaction or investment strategy (including account recommendations) to a retail customer. Form CRS is a disclosure document applicable to broker-dealers and registered investment advisers with retail investors, and is meant to reduce investor confusion about fees, conflicts of interest and the required standard of conduct for a particular firm. In his remarks, Mr. Clayton noted the SEC had engaged extensively over the past year with broker-dealers, investment advisers, market participants and regulatory partners such as FINRA, regarding the implementation of Reg BI and Form CRS. Based on the considerable progress observed, Mr. Clayton reiterated an earlier position from April 2020 that the June 30, 2020 compliance date for both rules was appropriate. Mr. Clayton further noted that the SEC’s work over the past several months had strengthened his view that the effects of the COVID-19 pandemic weighed substantially in favor of implementing Reg BI and Form CRS requirements as soon as practicable.
Chairman Clayton’s public statement is available here.
