What you need to know:

PHLX Rule 703(a) requires all Nasdaq PHLX ("PHLX") members and member organizations to maintain minimum net liquid assets. PHLX members and member organizations for which PHLX is the Designated Examining Authority ("DEA"), currently are required to submit to FINRA daily, in connection with a Regulatory Services Agreement between PHLX and FINRA, the amount of net liquid assets they maintained. The information is submitted to a centralized email address and is not an automated process. In an effort to streamline the daily submission and regulatory monitoring process, PHLX members and member organizations will be required to submit the requisite information using a secure FINRA portal. This does not represent a new reporting requirement, but instead a change in the transmission method of data being received daily by FINRA.

New Transmission Process

Specifically, members and member organizations will be required to submit the above-referenced information in an electronic file using a standardized Comma Separated Value ("CSV") format via a Secure File Transfer Protocol ("SFTP"). The file must be submitted to FINRA by each PHLX DEA member or member organization or its clearing firms(s), as is the case today. The electronic file must include the following data fields:

• Trade Date - Format YYYYMMDD
• Clearing Firm - CRD number of the firm submitting data
• PHLX DEA Firm - CRD number of the firm for which data is being submitted
• Net Equity Amount of securities and commodity accounts
• Haircut Amount on proprietary positions

Further guidance on file submission please refer to FINRA's Daily Capital Monitoring File Submission Details.

In order to ensure a smooth transition and to enable FINRA to perform parallel testing, each PHLX DEA member or member organization, or its clearing firm(s), will be requested to submit the daily information both via FINRA's SFTP site and the current email method for a brief period of time. The dual submission will be for the period from March 6, 2017 through March 20, 2017. Upon completion of parallel testing, the submissions should be routed to the production servers.

In connection with this transition, it is requested that each PHLX DEA member or member organization, or its clearing firm, provide the following information to the PHLX DEA member or member organization assigned FINRA Regulatory Coordinator no later than March 1, 2017.

• A single- Point of Contact with User Name. Email and Phone Number to coordinate the transition, and
• Firm's Internet Protocol ('IP") address that will be used to submit to the FINRA SFTP (normally the Production Server).

Where can I find additional information?

Questions regarding this Regulatory Alert may be directed to your FINRA Regulatory Coordinator. For technical questions relating to the submission of the data to the FINRA portal, please contact FINRA's Help Desk at 240-386-4141.