SEC Issues FAQs on Regulation Best Interest | Practical Law

SEC Issues FAQs on Regulation Best Interest | Practical Law

The SEC's Division of Trading and Markets released responses to frequently asked questions about Regulation Best Interest.

SEC Issues FAQs on Regulation Best Interest

Practical Law Legal Update w-023-5811 (Approx. 3 pages)

SEC Issues FAQs on Regulation Best Interest

by Practical Law Corporate & Securities
Published on 15 Jan 2020 • USA (National/Federal)
The SEC's Division of Trading and Markets released responses to frequently asked questions about Regulation Best Interest.
On January 13, 2020, the SEC's Division of Trading and Markets (Division) released responses to frequently asked questions relating to compliance with Regulation Best Interest. The responses cover questions on the topics of:
  • Recommendations, including:
    • the analysis and factors considered in determining whether communications are "recommendations"; and
    • the scope of recommendations covered by Regulation Best Interest.
  • Disclosure obligations, including:
    • the timing of written or oral disclosures in connection with recommendations; and
    • simultaneous delivery of Regulation Best Interest disclosures with Form CRS or quarterly account statements after its compliance date, June 30, 2020.
  • Care obligations, specifically:
    • what constitutes a series of transactions; and
    • whether a transaction is included a series of transactions.
  • Conflict of interest obligations, including:
    • specific conflicts that must be eliminated; and
    • conflict mitigation measures.
The Division expects to update the FAQs from time to time with responses to additional questions.
For more information on Regulation Best Interest, see Legal Update, SEC Adopts New Broker-Dealer and Investment Adviser Conduct Standards and Disclosure Requirements and Key Considerations and Guidance for Complying with Regulation Best Interest Chart.