July 27, 2015

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July 27, 2015

SEC Proposes Rules Regarding Technology Systems

On March 8, the Securities and Exchange Commission proposed Regulation Systems Compliance and Integrity (Regulation SCI), which would require certain self-regulatory organizations, alternative trading systems,plan processors and exempt clearing agencies (SCI Entities) to comply with certain requirements with respect to their technology systems. Proposed Regulation SCI would supersede and replace the SEC’s current Automation Review Policy.

Under the proposed regulation, SCI Entities must establish written policies and procedures to ensure that their technology systems have adequate levels of capacity, integrity, resiliency, availability and security. SCI Entities must also require participation by designated members and participants in testing the SCI Entities’ business continuity and disaster recovery plans, and coordinate such testing with other SCI Entities. Upon the occurrence of certain events, including systems disruptions, systems compliance issues and systems intrusions, SCI Entities must file proposed Form SCI with the SEC and take appropriate corrective action.

Comments should be submitted on or before 60 days after the proposed rules are published in the Federal Register.

The text of the proposed rules is available here.

©2015 Katten Muchin Rosenman LLP

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About this Author

Janet M. Angstadt, Securities Lawyer, Katten Muchin
Partner

Janet M. Angstadt is the head of Katten's Chicago Financial Services practice. She focuses her practice on broker-dealer and exchange compliance issues and advises companies on matters regarding compliance with the regulations of the US Securities and Exchange Commission (SEC) and self-regulatory organizations (SROs).

Janet represents clients in a wide range of legal and regulatory matters, including mergers and acquisitions, SRO investigations, compliance issues related to registrations, sales practice, short sales, Regulation NMS, market-making and options and equities order...

312.902.5494
James M. Brady, Katten Muchin Law Firm, Finance Attorney
Associate

James Brady concentrates his practice in financial services matters.

While in law school, James was an editor of the Michigan Journal of International Law. He also served as a judicial intern to the Honorable Stephen J. Markman of the Michigan Supreme Court. http://www.kattenlaw.com/James-Brady

312-902-5362