Brokers Must Report Short-Sale Exceptions Now
Published Date: 12/31/2025
Notice
Summary
FINRA is updating a rule to make sure broker-dealers report when they use a special exception for market makers selling stocks short. This change helps keep trading data clear and accurate, affecting anyone involved in stock trading and reporting. The new rule is effective immediately, so firms need to start following it right away, but it doesn’t add any new costs.
Analyzed Economic Effects
2 provisions identified: 0 benefits, 2 costs, 0 mixed.
New Short-Sale Exception Reporting
Broker-dealers (Industry Members) that trade equity securities must record and report to the Consolidated Audit Trail (CAT) whether an original receipt or origination of an order to sell an equity security is a short sale for which a market maker is claiming the bona fide market making exception in Rule 203(b)(2)(iii) of SEC Regulation SHO. This amendment to FINRA Rule 6830 implements the CAT NMS Plan change requiring that specific BFMM Locate Exception data be sent to the Central Repository.
Immediate Compliance Requirement
The rule change is operative immediately upon filing (filed December 12, 2025) because the SEC waived the usual 30-day operative delay. Industry Members must begin following the amended FINRA Rule 6830 right away, although the SEC may suspend the change within 60 days if it determines suspension is necessary.
Your PRIA Score
Personalized for You
How does this regulation affect your finances?
Sign up for a PRIA Policy Scan to see your personalized alignment score for this federal register document and every other regulation we track. We analyze your financial profile against policy provisions to show you exactly what matters to your wallet.
Key Dates
Department and Agencies
Related Federal Register Documents
2026-10373 — Registered Offering Reform
The SEC wants to make it easier and cheaper for more companies to sell their stocks and bonds to the public. They’re opening up special forms and benefits to more businesses, updating rules to be more modern, and cutting red tape by overriding some state rules. If you’re a company planning to raise money, these changes could speed things up and save you money, with feedback due by July 27, 2026.
2026-10222 — Enhancement of Emerging Growth Company Accommodations and Simplification of Filer Status for Reporting Companies
The SEC is making it easier for companies that report their finances by simplifying their categories into just two groups: big and small filers. Smaller companies, including emerging growth ones, will get more time to file reports and enjoy simpler rules, while big companies keep stricter standards. These changes aim to save time and money, with feedback open until July 20, 2026.
2026-07651 — Concept Release on Consolidated Audit Trail and Other Audit Trails and Data Sources
The SEC wants your thoughts on how it tracks stock market trades using the Consolidated Audit Trail and other data tools. They’re thinking about updating rules to keep up with new tech, privacy, and security needs, and to make sure the system is fair and cost-effective. If you’re involved in the stock market or data tracking, speak up by June 22, 2026!
2026-10669 — Self-Regulatory Organizations; MX2 LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Rule 2.4, Mandatory Participation in Testing of Backup Systems
MX2 LLC is updating its rule to change how it picks certain options traders to join backup system tests during its first year of operation. This means some traders will have to help test disaster recovery plans to keep things running smoothly. The change kicks in right away and helps protect the market without adding extra costs.
2026-10808 — Paxos Securities Settlement Company, LLC; Order Granting an Application for Temporary Registration as a Clearing Agency Under Section 17A of the Securities Exchange Act of 1934
Paxos Securities Settlement Company just got the green light for temporary registration as a clearing agency, meaning they can now help settle and clear securities trades safely and smoothly. This affects investors and financial firms who rely on quick, secure trade settlements. The approval kicks in right away, setting the stage for Paxos to shake up how trades get finalized, with no immediate cost changes announced.
2026-10667 — Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Designation of a Longer Period for Commission Action on Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change, as Modified by Amendment No. 1 Thereto, To List and Trade Shares of the T. Rowe Price Active Crypto ETF Under NYSE Arca Rule 8.201-E (Generic) Commodity-Based Trust Shares
The SEC is taking more time to decide if the T. Rowe Price Active Crypto ETF can be listed and traded on the NYSE Arca exchange. This affects investors interested in crypto ETFs and could impact when this new fund becomes available to trade. No money changes yet, but the decision deadline has been extended to ensure a thorough review.
Previous / Next Documents
Previous: 2025-24047 — Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing of a Proposed Rule Change To Amend Exchange Rule 11.23(d)(2)(B) (Extending the Quote-Only Period for Initial Public Offering (“IPO”) Auctions)
Cboe BZX Exchange wants to give more time for quote-only periods during IPO auctions, especially for exchange-traded products (ETPs). This change helps traders get a better feel for new listings before trading fully starts. It mainly affects companies going public on BZX and could improve market fairness without changing costs or timing for investors.
Next: 2025-24049 — Self-Regulatory Organizations; MEMX LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Rule 4.7 of the Exchange's CAT Compliance Rule
MEMX is updating its rules to make sure brokers report if a stock sale order is a special kind of short sale called a bona fide market making exception. This change helps keep trading data clear and accurate for everyone involved. The new rule kicks in right away, so brokers need to follow it now—no extra costs, just smoother reporting!