NASD Postpones Effective Date of Amended Definition of Branch Office and IM-3010-1

On March 10, the NASDfiled with the SEC a proposed rule change that postpones the effective date of (i) amendments to the definition of "branch office" and (ii) IM-3010-1, which provides guidance on factors to be considered by members when conducting internal office inspections.  The proposed rule change, which was effective on filing with the SEC, postpone the effective date of the amendments and IM-3010-1 from May 1, 2006 to July 3, 2006.

On September 9,2005, the NASD amended rule 3010(g)(2)(A) to provide a definition of the term "branch office" that is substantially similiar to the NYSE definition, which was adopted on that same date.  As amended, the term "branch office" generally would include any location where one or more associated persons of a member regularly conducts the business of affecting transactions in, or inducing or attempting to induce the purchase or sale of any security, ot any other location held out as such.  The definition provides a number of conditional exclusions, including, among others: (1) a location that operates solely as a back office, (2) a registered representative’s primary residence, provided it is not held out to the public as a branch office, and (3) locations used for less that 30 business days per year for securities business.

View the NASD Branch Office Extension

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