The Dodd-Frank Wall Street Reform and Consumer Protection Act amended Section 19 of the Exchange Act, 15 U.S.C. 78s(b)(2), so that there are new deadlines by which the SEC must publish and act upon proposed rule changes submitted by self regulatory organizations, or SROs. In recognition of the amendments to Section 19, the SEC is amending its rules governing delegations of authority to the Director of the Division of Trading and Markets.  The delegation is intended to conserve SEC resources and facilitate timely and effective compliance with the amendments to Section 19 of the Exchange Act and the new statutory deadlines prescribed therein.

The authority delegated to the Director of the Division of Trading and Markets includes authority:

• to disapprove a proposed rule change pursuant to Section 19(b) of the Exchange Act;
• to temporarily suspend a proposed rule change of an SRO;
• to notify an SRO that a proposed rule change does not comply with the rules of the SEC relating to the required form of a proposed rule change; and
• to determine that a proposed rule change is unusually lengthy and complex or raises novel regulatory issues and to inform the SRO of such determination.

In addition, the SEC is amending its rules to delegate to the Director of the Division of Trading and Markets authority:

• to determine the appropriateness of extending the time periods specified in Section 19(b) of the Exchange Act and publish the reasons for such determination as well as to effect any such extension;
•  to update the references to proceedings to determine whether to disapprove a proposal and to provide to the SRO notice of the grounds for disapproval under consideration;
• to find good cause to approve a proposal on an accelerated basis and to publish the reasons for such determination; and
• to extend the period for consideration of a national market system plan or an amendment to such plan.

Check dodd-frank.com frequently for the latest news relating to the Dodd-Frank Act. including updates on SEC rule making, implementation of the Act, and analysis of the Act’s impact on the financial regulatory markets.