- within Intellectual Property, Food, Drugs, Healthcare, Life Sciences and Transport topic(s)
The SEC adopted amendments to Regulation ATS that will impose additional public disclosure requirements on alternative trading systems ("ATS") that trade stocks listed on national securities exchanges. The disclosures will be made through the new Form ATS-N.
An ATS that is trading stocks listed on a national securities exchange will be required to disclose certain operational information, as well as information regarding its broker-dealer operator and its affiliates. According to the SEC, the additional information is intended to provide clarity for subscribers on (i) "how their orders will interact, match, and execute" in the ATS, (ii) if and how subscribers are treated differently on the ATS than the broker-dealer operator and its affiliates, (iii) potential conflicts of interest, and (iv) the treatment of confidential trading information.
Required information for an ATS that is subject to the new disclosure requirements will include:
- identifying and ownership information for its broker-dealer operator;
- ATS-related information on its broker-dealer operator and its affiliates, including trading activities, arrangements with trading centers, products and services available to subscribers, and measures in place for protecting subscribers' confidential trading information; and
- ATS operational details, including rules, fees, trading-related procedures, usage of market data, means of entry for orders and trading interest, and subscriber eligibility.
Form ATS-N filings will be made available to the public and will be subject to review by the SEC. All ATS will also be required to adhere to heightened standards for protecting subscribers' confidential trading information.
The amendments will become effective 60 days after their publication in the Federal Register.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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