FINRA—commencing an arbitration under the Industry Code
FINRA—commencing an arbitration under the Industry Code

The following Arbitration guidance note provides comprehensive and up to date legal information covering:

  • FINRA—commencing an arbitration under the Industry Code
  • The Industry Code
  • Starting an arbitration
  • Commencing a claim
  • Filing fees and member surcharges
  • Filing requirements and service of proceedings
  • Amending claims
  • Combining claims
  • Class action claims and collective claims
  • Shareholder derivative actions
  • more

The Industry Code

The Finance Industry Regulatory Authority (FINRA) has two Codes of Arbitration Procedure. One of them is the Code of Arbitration Procedure for Industry Disputes (the Industry Code), which governs arbitrations between industry parties. For information on commencing arbitration under the other code, the Code of Arbitration Procedure for Customer Disputes (the Customer Code), see Practice Note: FINRA—commencing an arbitration under the Customer Code.

Starting an arbitration

Where an industry dispute arises, FINRA arbitration proceedings will be mandatory in certain circumstances. In other cases, the parties may choose to arbitrate a dispute under the Industry Code. In all cases, the claim must be filed within six years of the events giving rise to the dispute (the Industry Code, Pt II, r 13206).

Under the Industry Code, Pt II, r 13200, FINRA arbitration proceedings must be conducted where:

  1. the dispute arises out of the securities business activities of a broker and/or a brokerage firm, and

  2. the dispute is between or among the following members of FINRA:

    1. brokerage firms

    2. brokerage firms and brokers, or

    3. brokers

For other industry disputes, parties may choose FINRA arbitration proceedings where the dispute involves an individual or entity registered with FINRA and is between brokerage firms or brokers, or between or among brokerage firms and brokers.

Under the Industry Code, Pt I, r IM-13000, if a