15A-6 Chaperoning Agreement

Jeremy Lyon @ 27-11-2020

When a foreign broker enters into an unsolicited transaction on behalf of a U.S. investor on the basis of Rule 15a-6 (a) (1), the Staff considers that such a foreign broker may provide the U.S. investor with confirmation of the transaction, regular bank statements and other transaction-related documents required by foreign law. However, in keeping with the broad views of staff on what an invitation is, the foreign broker cannot submit a document containing advertising or other documents intended to encourage other transactions. In response to another FAQ, the General Staff also found that invoking Rule 15a-6 (a) (1) (1) would not necessarily prevent a foreign broker from conducting additional unsolicited transactions on behalf of the same U.S. investor, provided those transactions were not solicited. 21 See id. The SEC has already indicated that the exception to Rule 15a-6 (a) (1) (1) for unsolicited transactions should reflect the view that “U.S. persons seeking unregistered foreign brokers outside the United States cannot expect the protection of U.S. broker standards.” See Rule 15a-6 acceptance version at 54 FR 30031. In this context, employees believe that if a foreign broker regularly trades directly with or for a U.S.

investor, the investor could reasonably expect to be protected by U.S. laws, regulations and supervisory structures applicable to registered brokers. 2 For the purposes of this FAQ, the term “chaperoneing broker dealer” refers to a registered broker who meets all the requirements of Rule 15a-6 (a) (a) (3) (iii), including, among other things, the conduct of transactions, the issuance of confirmations, the keeping of books and records, participation in oral communications and the collection of certain assurances and consents. [13] In 2008, the SEC proposed a number of amendments to update and expand the scope of Rule 15a-6 exemptions to reflect the increasing internationalization of securities markets and progress in technology and communication services, although these changes have not yet been adopted. See SEC version 34-58047, “Exemption of Certain Foreign Brokers or Dealers” (June 27, 2008), available under www.sec.gov/rules/proposed/2008/34-58047.pdf. [7] The use of the term “permanent residence” is important in that it recognizes the vocation of non-immigration visa holders (e.g. B H1-B visa holders) who wish to maintain financial services relationships with non-U.S. brokers, in accordance with Rule 15 bis-6 (a) (4)).iii). (return) Confirmations and explanations. [17] FAQs confirm that foreign comics with accompanying agreements have the option of sending confirmations and statements directly to U.S. counterparties if required by foreign law or their internal compliance policies. Chaperone brokerage dealers should always ensure that confirmations and statements that meet U.S.

requirements and the identification of the chaperoneing dealer and his role are sent to U.S. investors on their behalf. Answer: Yes. To the extent required by foreign law or as a company`s internal policies and procedures are necessary for its global business activities, a foreign broker may send confirmations and bank statements directly to U.S. counterparties. However, regardless of the delivery of a document to the investor by the foreign broker, the chaperoneing brokerage dealer reserves the obligation to ensure that confirmations and bank statements are sent to the investor, in accordance with all applicable U.S. requirements, including Rule 10b-10 under the Exchange Act and applicable self-regulatory rules. In addition, any confirmation or statement of account sent to a U.S. counterparty by a foreign broker on behalf of a chaperoning brokerage dealer must clearly identify the U.S. broker on whose behalf the document is sent.

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