Please see below for important information about proposed amendments to the SIPC Assessments Bylaw.

The Securities Investor Protection Act, 15 U.S.C. section 78aaa, et seq. (PDF) (SIPA), is the statute that created SIPC and governs SIPA liquidations.

SIPC, with the approval of the SEC, has issued the following rules:

  • Series 100 Rules (PDF) - Rules Identifying Accounts of “Separate Customers” of SIPC Members
  • Series 200 Rules (PDF) - Rules Relating to Accounts Introduced by Other Brokers or Dealers
  • Series 300 Rules (PDF) - Rules Regarding Closeout or Completion of Open Contractual Commitments
  • Series 400 Rules (PDF) - Rules Relating to Satisfaction of Customer Claims for Standardized Options
  • Series 500 Rules (PDF) - Rules Relating to Satisfaction of a “Claim for Cash” or a “Claim for Securities”
  • Series 600 Rules (PDF) - Rules Relating to Supplemental Report on SIPC Membership

Bylaws of the Securities Investor Protection Corporation as of August, 2014 (PDF)

The Securities and Exchange Commission is currently considering proposed bylaw amendments relating to assessments on SIPC member broker-dealers. Comments from the public are to be received on or before July 11, 2016. Information about how to submit a comment is available in the Federal Register, 81 Fed. Reg. 39986, and at http://www.sec.gov/cgi-bin/ruling-comments. The full text of the proposed bylaw change is below.

ARTICLE 6

ASSESSMENTS

Section 1. General

(a) Amount of Assessment.

(1) The amount of each member's assessment for the member's fiscal year shall [either be (a) the minimum amount or (b)] be the product of the assessment rate established by SIPC for that fiscal year and either the member's gross or net revenues from the securities business, as follows:

(A) The assessment rate shall be one-fourth (1/4) of one (1) percent per annum of net operating revenues from the member's securities business [until] for each calendar year or part thereof unless SIPC determines that the balance of the SIPC Fund, as defined in Section 4(a)(2) of the Act, exclusive of confirmed lines of credit, has aggregated a [target] balance of $2.5 billion, and (ii) will remain at or above $2.5 billion for six months or more.

(B) Notwithstanding the provisions of Section 1(a)(1)(A) herein, if SIPC determines that the balance of the SIPC Fund, as defined in Section 4(a)(2) of the Act, exclusive of confirmed lines of credit, has aggregated $2.5 billion, and (ii) will remain at or above $2.5 billion for six months or more, but SIPC's unrestricted net assets, as reflected in SIPC's most recent audited Statement of Financial Position, are less than $2.5 billion, the assessment rate shall be 0.15 percent per annum of net operating revenues from the member's securities business for each calendar year or part thereof.

(C) If SIPC determines that the balance of the SIPC Fund, as defined in Section 4(a)(2) of the Act, exclusive of confirmed lines of credit, has aggregated $2.5 billion or more, and will remain at or above $2.5 billion for six months or more, and SIPC's unrestricted net assets, as reflected in SIPC's most recent audited Statement of Financial Position, are at or above $2.5 billion, members shall pay a minimum assessment, which shall be 0.02 percent of the net operating revenues from the securities business for each calendar year or part thereof.

[C](D) Anything to the contrary herein notwithstanding, if at any time SIPC determines that the balance of the SIPC Fund, as defined in Section 4(a)(2) of the Act, exclusive of confirmed lines of credit, aggregates or is reasonably likely to aggregate:

less than [the target balance of] $2.5 billion and will likely remain less than $2.5 billion for a period of six (6) months or more-the amount of each member's assessment shall be at an assessment rate of one-fourth (1/4) of one (1) percent per annum of net operating revenue.

(ii) less than $150,000,000-the amount of each member's assessment shall be at an amount to be determined by SIPC, but in no case shall the amount of each member's assessment be less than an assessment rate of one-fourth (1/4) of one (1) percent per annum of such member's gross revenues from the securities business.

(iii) less than $100,000,000-the amount of each member's assessment shall be at an amount to be determined by SIPC, but in no case shall the amount of each member's assessment be less than an assessment rate of one-half (1/2) of one (1) percent per annum of such member's gross revenues from the securities business.

(iv) The amount of each member's assessment shall not exceed one-half (1/2) of one (1) percent per annum of such member's gross revenues from the securities business, unless SIPC determines that a rate in excess of one-half (1/2) of one (1) percent during any twelve (12) month period will not have a material adverse effect on the financial condition of its members or their customers. No assessment made pursuant to this Section 1(a)(1) shall require payments during any such period that exceed in the aggregate one (1) percent of any member's gross revenues from the securities business for such period.

(2) Any change in assessments made in accordance with [the above] Section 1(a)(1) herein shall commence on the first day of the [month] year following the date on which SIPC announces its determination, or on such other date if the exigency of the circumstances so warrants in SIPC's determination, and continue until such time as SIPC provides otherwise.

(3) Commencing on the first day of the month following the date on which SIPC borrows moneys pursuant to Section 4(f) or Section 4(g) of the Act, and continuing while any such borrowing is outstanding and until such further time as SIPC provides otherwise, the amount of each member's assessment shall be at an assessment rate of not less than one-half (1/2) of one (1) percent per annum of such member's gross revenues from the securities business.

(b) Payments. Assessments shall be payable at such times and in such manner as may be determined by SIPC's Vice President-Finance with the approval of the Chairman.

(c) Collection of General Assessments. Each member of the Corporation who is a member of a self-regulatory organization shall pay assessments to its collection agent. In the case of members who are not members of any self-regulatory organization, assessments shall be paid directly to the Corporation.

(d) Report by Collection Agents. Within 45 days after each due date, each self-regulatory organization which is the collection agent shall submit a written report to the Corporation as to any entity for whom it acts as collection agent whose filing or assessment payment has not been received.

(e) Interest on Assessments. If all or any part of an assessment payable under Section 4 of the Act has not been received by the collection agent within 15 days after the due date thereof, the member shall pay, in addition to the amount of the assessment, interest at the rate of 20% per annum on the unpaid portion of the assessment for each day it has been overdue. If any broker or dealer has incorrectly filed a claim for exclusion from membership in the Corporation, such broker or dealer shall pay, in addition to assessments due, interest at the rate of 20% per annum on the unpaid assessment for each day it has not been paid since the date on which it should have been paid.

(f) Gross Revenues. The term "gross revenues from the securities business" includes the revenues in the definition of gross revenues from the securities business set forth in the applicable sections of the Act.

(g) Net Operating Revenues. The term "net operating revenues from the securities business" means gross revenues from the securities business less interest and dividend expenses, and includes those clarifications as are set forth in the SIPC assessment forms and instructions.

Section 2. Overpayments

If the final annual reconciliation filed by a terminated member reflects an assessment overpayment carried forward that exceeds $150.00, SIPC may refund such excess to the member upon receipt of the member's written request therefor and after the member's SIPC collection agent has confirmed to SIPC that all of the member's SIPC assessment form filings and payments and reports required by SEC Rule 17a-5 covering periods through the termination date have been reviewed and accepted.

Section 3. Interpretation of Terms

For purposes of this Article:

(a) The term "securities in trading accounts" shall mean securities held for sale in the ordinary course of business and not identified as having been held for investment.

(b) The term "securities in investment accounts" shall mean securities that are clearly identified as having been acquired for investment in accordance with provisions of the Internal Revenue Code applicable to dealers in securities.

(c) The term "fees and other income from such other categories of the securities business" shall mean all revenue related either directly or indirectly to the securities business except revenue included in Section 16(9)(A)-(K) and revenue specifically excepted in Section 4(c)(3)(C).