The proposed rule on the application of the Act has to do with broker-dealers that offer certain full-service brokerage services for an asset-based fee instead of traditional commissions. Brokers who garner compensation through asset-based fees may be the subject of regulation under the Act. The rule proposed in 1999 would make the nature of the services provided – rather than the form of compensation – the principal factor in determining whether the Act applies.
The comment period was reopened after a recent surge in additional comments. The new deadline for comments is now September 15 th , with the SEC hoping to make a final ruling by the end of the calendar year, according to an SEC press release.
– Kip McDaniel
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