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Compliance Rules

Part 2 - Rules Governing the Business Conduct of Members Registered with the Commission


[Adopted effective September 30, 1992. Effective date of amendments: January 28, 1994; August 21, 2001; December 9, 2005; December 17, 2007; July 9, 2013 and January 3, 2022.]

(a) No Member shall allow an Associate to be a branch office manager unless:

    (1) The Associate has taken and passed the NFA Branch Manager Examination, provided, however, that any Associate who subsequently ceases acting as a branch manager will not be required to retake and pass the examination in order to resume acting as a branch manager unless after acting as a branch manager the Associate was not registered in any capacity for a period of more than two years;

    (2) The Associate is sponsored by a registered broker-dealer and is qualified to act as a branch office manager under the rules of either the New York Stock Exchange or the Financial Industry Regulatory Authority; or

    (3) The Member has been approved as a swap firm by NFA and its sole activities are soliciting and accepting orders for swaps subject to the jurisdiction of the CFTC and the Associate has taken and passed NFA's Swaps Proficiency Requirements in accordance with NFA Bylaw 301(l).

(b) Each Member registered as a broker-dealer under Section 15(b)(11) of the Exchange Act must have at least one designated security futures principal. No such Member shall designate a person as a security futures principal unless:

    (1) The person is a partner, officer, director, branch office manager or supervisory employee of the Member;

    (2) The person is a Member or an Associate of the Member as defined in Bylaw 301(b); and

    (3) The person has taken and passed the "NFA Branch Manager Examination."