FINRA proposes rule change on bona fide market making exception

Detected February 6th, 2026

Summary

FINRA has proposed a rule change (SR-FINRA-2025-016) to amend FINRA Rule 6830 concerning data reporting under the Consolidated Audit Trail (CAT). The change aims to align reporting requirements with amendments to the CAT NMS Plan regarding the bona fide market making exception under SEC Regulation SHO.

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What changed

FINRA is proposing a rule change to amend FINRA Rule 6830, which governs industry member data reporting under the Consolidated Audit Trail (CAT). This amendment is intended to align the rule with recent changes to the CAT NMS Plan. Specifically, it will require broker-dealers to report whether an order to sell an equity security is a short sale for which they are claiming the bona fide market making exception under Rule 203(b)(2)(iii) of Regulation SHO.

This proposed change will impact broker-dealers that are subject to CAT reporting obligations and claim the bona fide market making exception. They will need to ensure their data reporting systems are updated to accurately capture and report this new data point. The filing is a proposed rule change, indicating that it is open for public comment, though a specific comment deadline is not provided in this document. Compliance with the amended rule will be required once it is approved and becomes effective.

Source document (simplified)

SR-FINRA-2025-016

Proposed Rule Change to Amend FINRA Rule 6830 (Industry Member Data Reporting) Regarding the Bona Fide Market Making Exception under SEC Regulation SHO

Financial Industry Regulatory Authority, Inc. (“FINRA”) is filing with the Securities and Exchange Commission (“SEC” or “Commission”) a proposed rule change to amend FINRA Rule 6830 (Industry Member Data Reporting) of FINRA’s compliance rule (“CAT Compliance Rule”) regarding the National Market System Plan Governing the Consolidated Audit Trail (the “CAT NMS Plan” or “Plan”) to be consistent with the amendment to the CAT NMS Plan that requires broker-dealers with a reporting obligation to CAT to report whether an original receipt or origination of an order to sell an equity security is a short sale for which a market maker is claiming the bona fide market making exception in Rule 203(b)(2)(iii) of Regulation SHO (“BFMM Locate Exception”).

| Title | Format - Size | Status |
| --- | --- | --- |
| Text of the Proposed Rule Change | PDF - 2.09 MB | |
| Notice of Filing and Immediate Effectiveness | PDF - 213.98 KB | |