Significant SEC Relief Secured for Cross Border Securities Trading System
WASHINGTON, D.C.- The international law firm of McDermott Will & Emery announced today that the U.S. Securities and Exchange Commission has granted important regulatory relief to its client, Broker-to-Broker Networks, Inc., the parent holding company of Omiris Networks, a London-based company that has created a communications network that aims to cut costs of cross-border equity trading and reduce the incidence of failed transactions. The SEC issued a "no-action" letter deemed significant by its Division of Market Regulation under which the Omiris system is permitted to operate without the company registering as a broker-dealer under the U.S. Securities Exchange Act.
Broker-to-Broker Chief Executive Officer Charles R. Giessen said, "The Omiris proposition is to offer local expertise, efficiency and quality of execution to financial institutions, regardless of their location, over a secure, private telecommunications infrastructure. Central to this proposition is that Omiris Networks be both market and regulatory neutral. We are, therefore, very pleased to be granted regulatory relief by the SEC because it reinforces our strategy of being a totally neutral provider of the first truly cross border trading capability."
"The SEC has been very concerned in the past couple of years about how to regulate the increasing number of ever more sophisticated electronic trading systems that arguably have certain badges of traditional broker-dealer activity, such as soliciting investors, advising clients, negotiating transactions and earning commissions," said Boston-based McDermott partner David Cifrino, who submitted the request for relief with the SEC. "We think the letter reflects important principles that can be a useful model for other companies seeking to establish themselves as advanced technology-based service providers to the securities trading industry able to operate without excessive regulatory burdens."
Eugene Goldman, a McDermott Will & Emery partner and former SEC staff member based in Washington, D.C., organized and led discussions between executives of Broker-to-Broker Networks and senior managers of the SEC's Division of Market Regulation. "Our position to the SEC was that the Omiris system will provide valuable technology that seeks to make cross-border trading by broker-dealer subscribers more cost-effective without the system itself effecting securities transactions such as would require regulatory oversight," Mr. Goldman said.
