On October 12, 2022, the US Securities and Exchange Commission (SEC or Commission) adopted amendments (Final Rules) to the electronic recordkeeping requirements applicable to broker-dealers, security-based swap dealers, and major security-based swap participants under the Securities Exchange Act of 1934. The Final Rules are largely consistent with the Proposed Amendments with some modifications.
The Final Rules are effective 60 days after publication in the Federal Register. The compliance dates for the new requirements will be six months after publication in the Federal Register for broker-dealers and 12 months after publication in the Federal Register for SBS Entities.
The SEC addressed several concerns raised by the commenters when adopting the Final Rules. Although the Final Rules do not have the flexibility that a principles-based approach might offer, they strike a balance between what the SEC described as setting forth a specific and testable outcome (i.e., the ability to access and produce modified or deleted records in their original form) and technology-neutral terminology that should bring the electronic recordkeeping requirements in line with technological innovation for the foreseeable future.