FINRA—FINRA's powers and the panel’s powers under the Customer Code and the Industry Code
FINRA—FINRA's powers and the panel’s powers under the Customer Code and the Industry Code

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

  • FINRA—FINRA's powers and the panel’s powers under the Customer Code and the Industry Code
  • FINRA's powers

The Financial Industry Regulation Authority (FINRA) has two Codes of Arbitration Procedure:

  1. the Code of Arbitration Procedure for Customer Disputes (the Customer Code or Section 12000 of the FINRA Rules)—which governs arbitration proceedings between investors and industry parties, and

  2. the Code of Arbitration Procedure for Industry Disputes (the Industry Code or Section 13000 of the FINRA Rules)—which governs arbitration proceedings between industry parties

For more information on FINRA, see Practice Note: FINRA—background, structure and purpose under the Customer Code and the Industry Code.

FINRA's powers

FINRA’s powers are not limited or precluded by the submission of disputes (investor and industry) to FINRA arbitration. The rights, actions and determinations that it would otherwise be authorised to adopt, administer or enforce are protected by the Customer Code, Pt I, r 12104 and the Industry Code, Pt I, r 13104.

Denial of forum

FINRA has the power to deny the use of the FINRA arbitration forum if the director of FINRA determines that the subject matter of the dispute is inappropriate given the purposes of FINRA and the intent of the specified Code. Similarly, the director may decline a dispute that it considers a risk to the health or safety of arbitrators, staff or parties, or their representatives. Where a dispute arises out of a transaction in a readily-identifiable market, the dispute may be referred