SEC Trading and Markets FAQ: Rule 194 Application and Notice Submissions

May 10, 2022

These FAQs represent the views of the staff of the Division of Trading and Markets (“TM Staff”). They are not a rule, regulation, or statement of the Securities and Exchange Commission (“Commission”). The Commission has neither approved nor disapproved their content. These FAQs, like all staff statements, have no legal force or effect: they do not alter or amend applicable law, and they create no new or additional obligations for any person. [1]

How to file Rule 194 Applications or Notices in Lieu of Application with the Commission.

Rule 194 provides a process for a registered security-based swap dealer or major security-based swap participant (collectively known as SBS Entities), to submit an application to the Commission requesting that a statutorily disqualified associated person be permitted to effect or be involved in effecting security-based swaps on behalf of the SBS Entity.[2] In lieu of an application, Rule 194 also permits SBS Entities to file a notice with the Commission that a statutorily disqualified associated person will be involved in effecting security-based swaps on behalf of the SBS Entity, where certain conditions are met.[3]

Applications and notices filed with the Commission pursuant to Rule 194 should be filed with the Commission’s Office of the Secretary. The FAQs below provide additional information for SBS Entities regarding the filing process.

1. How should an SBS Entity file a Rule 194 application with the Commission?

   Rule 194 provides that applications must be filed pursuant to certain Commission Rules of Practice.[4] Rule 194 applications should be submitted to the Commission’s Office of the Secretary by email to the inbox Secretarys-office@sec.gov and should contain the subject line: “Rule of Practice 194 application by [insert SBS Entity’s name] on behalf of [insert associated person’s name].”

   To the extent you have any questions regarding filing Rule 194 applications, please contact TM Staff by telephone at 202-551-5777 or by email at tradingandmarkets@sec.gov.

2. Will applications filed with the Commission be made public?

   Generally, no. The Commission will keep applications and supporting materials confidential, subject to the existing statutory and regulatory framework with respect to the public availability of such materials, including the Freedom of Information Act (“FOIA”), the Securities Exchange Act of 1934 (“Exchange Act”) and applicable Commission rules.[5]

3. Will Commission orders granting or denying applications be made public?

   Yes. Orders granting or denying applications will be made public on the Commission’s website, consistent with current practice.[6]

4. How should an SBS Entity file a Rule 194 notice with the Commission?

   Rule 194 references the Commission Rules of Practices for the filing of notices.[7] Notices filed in lieu of a Rule 194 application should be submitted the Commission’s Office of the Secretary using the email inbox Secretarys-office@sec.gov and should contain the following subject line: “Rule of Practice 194 notice in lieu of application by [insert SBS Entity’s name] on behalf of [insert associated person’s name].”

   Rule 194 references the Commission Rules of Practices for the filing of notices.[7] Notices filed in lieu of a Rule 194 application should be submitted the Commission’s Office of the Secretary using the email inbox Secretarys-office@sec.gov and should contain the following subject line: “Rule of Practice 194 notice in lieu of application by [insert SBS Entity’s name] on behalf of [insert associated person’s name].”

   To the extent you have any questions regarding filing a notice pursuant to Rule 194, please contact TM Staff by telephone at 202-551-5777 or by email at tradingandmarkets@sec.gov.

5. Will notices filed with the Commission be made public?

   Yes. Notices filed with the Commission will be made public on the Commission’s website.[8] Although not required, a filer may submit supporting materials with a notice as separate attachments. To the extent such supporting materials contain information the filer does not want posted on the website, the filer may request confidential treatment.

6. Who may I contact with questions about my application or notice or about the filing process in general?

   Questions regarding Rule 194 generally, including questions regarding applications and notices thereunder, may be directed to TM Staff by telephone at 202-551-5777 or by email at tradingandmarkets@sec.gov.

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[1] See 17 CFR 201.194. See also Applications by Security-Based Swap Dealers or Major Security-Based Swap Participants for Statutorily Disqualified Associated Persons to Effect or Be Involved in Effecting Security-Based Swaps, Release No. 34-84858 (Dec. 19, 2018), 84 FR 4906, 4906-08 (Feb. 19, 2019) (“Rule 194 Adopting Release”).

[2] See 17 CFR 201.194(d) (Form of Application).

[3] See 17 CFR 201.194(h) (Notice in Lieu of Application).

[4] See 17 CFR 201.194(d) (citing 17 CFR 201.151, 201.152, and 201.153). See also Rule 194 Adopting Release, 84 FR at 4913 n.88 (explaining that, in general, Rule of Practice 151 concerns the procedure for filing of papers with the Commission, Rule of Practice 152 concerns the form of filing papers with the Commission, and Rule of Practice 153 concerns the signature requirement and effect of filing papers).

[5] See id. at 4919 nn.193-95 (citing 5 U.S.C. 552, et seq.; 15 U.S.C. 78x.; 17 CFR 200.80; 17 CFR 201.190; 17 CFR 240.24b–2).

[6] See id. at 4919 n. 203. See also id. at 4922(explaining that, unlike applications and their supporting materials, orders and notices under Rule of Practice 194 will be made publicly available on the Commission’s website).

[7] See 17 CFR 201.194(h)(2)(iii) (citing 17 CFR 201.151, 201.152, and 201.153).

[8] See id. at 4922*.*

Last Reviewed or Updated: June 26, 2024