11310. Book-Entry Settlement
(a) A member shall use the facilities of a securities depository for the book-entry settlement of all transactions in depository eligible securities with another member or a member of a national securities exchange or a registered securities association.
(b) A member shall not effect a delivery-versus-payment or receipt-versus payment transaction in a depository eligible security with a customer unless the transaction is settled by book-entry using the facilities of a securities depository.
(c) For purposes of this Rule, the term "securities depository" shall mean a securities depository registered as a clearing agency under Section 17A of the Exchange Act.
(d)(1) The term "depository eligible securities" shall mean securities that
(A) are part of an issue of securities that is eligible for deposit at a securities depository and
(B) with respect to a particular transaction, are eligible for book-entry transfer at the depository at the time of settlement of the transaction.
(2) A determination under rules of a national securities exchange that a security depository has included a CUSIP number identifying a security in its file of eligible issues does not render the security "depository eligible" under this Rule until:
(A) in the case of any new issue distributed by an underwriting syndicate on or after the date a securities depository system for monitoring repurchases of distributed shares by the underwriting syndicate is available, the date of the commencement of trading in such security on the exchange; or
(B) in the case of any new issue distributed by an underwriting syndicate prior to the date a securities depository system for monitoring repurchases of distributed shares by the underwriting syndicate is available where the managing underwriter elects not to deposit the securities on the date of the commencement of trading in such security on the exchange, such later date designated by the managing underwriter in a notification submitted to the securities depository; but in no event more than three months after the commencement of trading in such security on the exchange.
(e) This Rule shall not apply to transactions settled outside of the United States.
(f) The requirements of this Rule shall supersede any inconsistent requirements under other Rules in the Code.
(g) This Rule shall not apply to any transactions where the securities to be delivered in settlement of the transaction are not on deposit at a securities depository and:
(1) if the transaction is for same-day settlement, the deliverer is unable to deposit the securities in a securities depository prior to the cut-off time established by the depository for same-day crediting of deposited securities, or
(2) the deliverer is unable to deposit the securities in a depository prior to the cut-off date established by the depository for that issue of securities.
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Amended by SR-FINRA-2010-030 eff. Dec. 15, 2010. Amended by SR-NASD-2005-087 eff. Aug. 1, 2006 Amended by SR-NASD-95-24 eff. June 7, 1995. Amended eff. Aug. 10, 1993. Selected Notices: 93-45, 95-55, 10-49. |