On January 8, 2026, NYSE Arca, Inc. filed a proposed rule change with the Securities and Exchange Commission to amend its Equities Fees and Charges schedule. The amendment focuses on system processing fees for the Central Registration Depository, or CRD, which are collected by the Financial Industry Regulatory Authority, known as FINRA. This filing, designated as immediately effective under Section 19(b)(3)(A)(ii) of the Securities Exchange Act of 1934, introduces a tiered fee structure for non-FINRA Equity Trading Permit Holders, or ETP Holders, starting January 2, 2026. The move mirrors recent FINRA fee adjustments and seeks to align costs with regulatory expenses. It affects registration fees for associated persons of broker-dealers not affiliated with FINRA, highlighting ongoing efforts to standardize fees across the securities industry amid evolving regulatory demands.
Background on CRD and Fee Structure
The CRD system serves as the central licensing and registration platform for the U.S. securities industry, managed by FINRA. It allows individuals and firms to register with multiple states and self-regulatory organizations through a single submission process, including forms, fingerprints, and fees. FINRA maintains records of qualification, employment, and disciplinary histories for registered persons associated with broker-dealers.
NYSE Arca, an exchange that facilitates trading in equities and exchange-traded products, requires its ETP Holders to register associated persons via CRD. For ETP Holders that are not FINRA members—referred to as Non-FINRA ETP Holders—FINRA collects and retains these registration fees on behalf of the exchange. Historically, NYSE Arca has adopted CRD fees identical to those charged by FINRA to ensure consistency. Previous amendments occurred in 2005, 2013, 2022, 2023, and 2024, as noted in SEC releases such as Release No. 51641 and Release No. 96682.
The current proposal stems from FINRA's 2024 amendments to its own fee schedule, detailed in SEC Release No. 93709. FINRA adjusted fees for implementation between 2026 and 2028 to better correlate with regulatory costs. NYSE Arca's filing ensures that Non-FINRA ETP Holders pay the same rates, emphasizing that CRD usage costs FINRA equally regardless of membership status.
Details of the Proposed Fee Changes
The amendment modifies the flat $70 fee for each registered representative and principal to a tiered system based on the number of securities regulators with which the person is registered, excluding investment adviser representatives. The new structure, as outlined in the filing, is as follows:
- 1 to 5 regulators: $70
- 6 to 20 regulators: $95
- 21 to 40 regulators: $110
- 41 or more regulators: $125
These fees apply specifically to system processing for registrations. The exchange does not collect or retain these fees itself—FINRA handles that process. The filing states that the change is not intended to address other regulatory fee issues and anticipates no compliance problems for ETP Holders.
This tiered approach reflects FINRA's view, as expressed in its own filing, that fees should align more closely with cost drivers, such as the complexity of multi-jurisdictional registrations. For context, FINRA's fees are set under Section 4 of Schedule A to its By-Laws, and NYSE Arca's proposal directly references Section 4(b)(7).
Statutory Basis and Regulatory Justification
NYSE Arca justifies the proposal under Section 6(b) of the Securities Exchange Act of 1934, which requires exchanges to ensure equitable allocation of reasonable dues, fees, and charges, and to promote just and equitable principles of trade. The filing argues that the changes foster a free and open market by protecting investors and the public interest without unfair discrimination.
Specifically, the exchange notes that the fees will match those FINRA implements in January 2026, ensuring parity. 'The costs of operating and improving the CRD system are similarly borne by FINRA when a Non-FINRA ETP Holder uses the CRD system,' the filing states. It further contends that the tiered structure is reasonable as it correlates fees with regulatory costs. On competition, the proposal asserts no undue burden, as it results in uniform fees for all users required to report to CRD, regardless of FINRA membership.
This aligns with precedents where exchanges have harmonized fees with FINRA's, as seen in prior NYSE Arca filings approved by the SEC. The immediate effectiveness under Rule 19b-4(f)(2) allows the change without prior approval, subject to potential suspension within 60 days if the SEC deems it necessary.
Perspectives and Implications
From the perspective of Non-FINRA ETP Holders, the tiered fees could increase costs for those with extensive multi-state registrations, potentially affecting smaller firms more than larger ones with fewer registrations per person. Industry groups might view this as a fair adjustment to cover FINRA's operational expenses, given rising costs for system maintenance and cybersecurity.
Regulators, including the SEC, emphasize uniformity to prevent fee disparities that could distort market participation. Critics, however, could argue that tiering introduces complexity, though the filing counters this by noting greater specificity in fee application.
Short-term implications include smoother registration processes with cost-aligned incentives, possibly encouraging efficient registration strategies. Long-term, this could influence broader discussions on regulatory fee structures, especially as digital registration systems evolve. Different stakeholders—such as state regulators versus federal bodies—may debate the balance between cost recovery and accessibility for new market entrants.
In summary, NYSE Arca's proposal standardizes CRD fees, promoting equity in the registration process. Potential next steps include monitoring SEC comments, which are solicited until February 3, 2026, and assessing any adjustments based on feedback. Ongoing debates may center on fee transparency and the impact on market competition, with challenges arising from future FINRA amendments or technological shifts in registration systems.
