Table of Contents
SERIES 7 | SERIES 24 | FINANCIAL REGULATION COURSES
FINRA Rule 11220 is the content-requirements rule that completes the 11200 Comparisons or Confirmations and Don't Know Notices subsection — the provision specifying what information every Uniform Comparison or Confirmation required under FINRA Rule 11210 must actually contain beyond the bare identification of the security and parties. The rule consists of a single operative paragraph stating two requirements.
The first requirement establishes three mandatory categories of content: confirmations or comparisons shall include an adequate description of the security, which shall include payment options on a unit investment trust series; the price at which the transaction was made; and any other information deemed necessary to ensure that the buyer and seller agree as to details of the transaction.
The second sentence provides illustrative examples of this third, catch-all category — such other information should include, if applicable, but need not be limited to, such phrases as ex-warrants, ex-stock, registered, flat, part-redeemed, Canadian funds, with proxy, and similar designations. FINRA Rule 11220 was amended effective March 18, 1993 and by SR-FINRA-2010-030 effective December 15, 2010 — no amendments have occurred since. Two selected notices are associated — 83-69 and 10-49.
FINRA Rule 11220 sits within the 11200 Comparisons or Confirmations and Don't Know Notices subsection of the 11000 Uniform Practice Code as its second and final rule, immediately following FINRA Rule 11210's comparison, confirmation, and Don't Know Notice framework and immediately preceding FINRA Rule 11300's series marker for the Delivery of Securities subsection.
FINRA Rule 11220's first sentence establishes three categories of content that every Uniform Comparison or Confirmation under FINRA Rule 11210 must include, working together to ensure that the document fully captures everything both parties need to agree that they are describing the same transaction in the same terms.
The first category — an adequate description of the security, which shall include payment options on a unit investment trust series — establishes the baseline identification requirement.
An adequate description of the security goes beyond the bare CUSIP number that FINRA Rule 11100(d) requires on the Uniform Comparison or Confirmation form itself — it requires sufficient descriptive information that both parties can confirm they are transacting in the same security, with the same specific terms, as each other.
The specific carve-in for payment options on a unit investment trust series reflects the particular complexity of UIT securities, discussed in this dictionary's earlier entry on FINRA Rule 11100(a)(4)'s carve-back of UIT secondary market transactions into Uniform Practice Code coverage — UIT securities may be available under different payment plan structures, such as periodic payment plans of varying configurations, and a transaction in UIT securities under one payment option is not interchangeable with the same UIT security under a different payment option. FINRA Rule 11220's explicit requirement that the description include payment options on a unit investment trust series ensures that this dimension of UIT securities — easily overlooked if description requirements focused only on the underlying portfolio securities or the trust itself — is captured in every UIT comparison or confirmation.
The second category — the price at which the transaction was made — is the most fundamental economic term of any transaction, and its inclusion in FINRA Rule 11220's requirements confirms that the Uniform Comparison or Confirmation is not merely a security-identification document but a complete transaction-terms document, capturing both what was transacted and at what price.
The third category — any other information deemed necessary to ensure that the buyer and seller agree as to details of the transaction — is the rule's catch-all provision, and the one that gives FINRA Rule 11220 its enduring flexibility across the more than three decades since its 1993 amendment. Rather than attempting to enumerate every possible piece of information that might be relevant to ensuring agreement on transaction details — an enumeration that would inevitably become outdated as new security types, trading conventions, and settlement arrangements emerged — FINRA Rule 11220 establishes a functional standard: whatever information is necessary, given the specific transaction's characteristics, to ensure the buyer and seller agree as to details of the transaction must be included.
FINRA Rule 11220's second sentence provides illustrative — explicitly non-exhaustive, per the should include... but need not be limited to formulation — examples of the kind of other information the third category contemplates. The enumerated phrases — ex-warrants, ex-stock, registered, flat, part-redeemed, Canadian funds, with proxy — function as a kind of cross-reference index into the substantive provisions of the Uniform Practice Code examined throughout this dictionary's coverage, each phrase corresponding to a specific rule or concept whose applicability to a given transaction is precisely the kind of detail that FINRA Rule 11220 requires the comparison or confirmation to capture.
Ex-warrants directly invokes FINRA Rule 11140's ex-dividend, ex-rights, and ex-warrants framework — a transaction executed on or after the ex-warrants date determined under FINRA Rule 11140 trades without the right to a pending warrant distribution, and the comparison or confirmation must reflect this ex-warrants status so both parties agree that the transaction does not carry that right.
Ex-stock similarly invokes the FINRA Rule 11140 framework's treatment of stock dividends and stock splits — a transaction trading ex-stock with respect to a pending stock dividend or split does not carry the right to receive the additional shares, and this status must be reflected in the comparison or confirmation.
Registered invokes the registration status of the security being transacted — a distinction relevant throughout the FINRA Rule 11500 Delivery of Securities with Restrictions subsection, where registered securities require specific assignment and transfer documentation as distinguished from bearer securities, and where the registration name itself may need to match between the parties' understanding of the transaction.
Flat directly invokes FINRA Rule 11150's framework for bonds dealt in flat — confirming that the transaction's price does not separately account for accrued interest, consistent with FINRA Rule 11150's ex-interest date determinations for such securities, as distinguished from a bond trading and accrued interest.
Part-redeemed directly invokes FINRA Rule 11170's framework for part-redeemed bonds — confirming that the bond being transacted has already had a portion of its principal redeemed, and that FINRA Rule 11170's settlement price formula — multiplying the contract price by the original principal amount — governs the transaction's settlement price calculation.
Canadian funds reflects the cross-border dimension of certain over-the-counter transactions — securities that may be denominated in or settled using Canadian currency rather than United States dollars, a designation critical to ensuring both parties agree on the currency of settlement for a given transaction, particularly relevant for securities of Canadian issuers that trade in both Canadian and U.S. markets.
With proxy reflects the corporate governance dimension of certain securities transactions — confirming whether the transaction includes the transfer of proxy voting rights along with the security itself, a designation relevant to transactions occurring around a company's record date for an upcoming shareholder vote, where the timing of the transaction relative to that record date determines which party — buyer or seller — holds the proxy voting right for the security being transacted.
FINRA Rule 11220's illustrative phrases collectively function as something more than a mere list of examples — they represent a distilled summary of the Uniform Practice Code's most operationally significant terminology, each phrase a shorthand reference to a substantive body of rules examined throughout this dictionary's coverage of the 11000 series. In this sense, FINRA Rule 11220 — though brief, consisting of only two sentences — serves an interpretive function for the Uniform Practice Code as a whole: it identifies, through its illustrative examples, the specific categories of transaction-defining characteristics that the Code's substantive provisions address, and confirms that whenever any of these characteristics applies to a given transaction, that characteristic must be reflected in the transaction's Uniform Comparison or Confirmation.
This interpretive function reinforces the broader theme this dictionary has traced throughout its coverage of the Uniform Practice Code — that the Code's various substantive provisions, from the ex-date frameworks of FINRA Rules 11140 through 11170 through the delivery and units-of-delivery frameworks yet to be examined in FINRA Rules 11300 through 11650, are not free-standing technical requirements operating in isolation from the documentary infrastructure of FINRA Rules 11210 and 11220. Rather, these substantive provisions and the documentary infrastructure operate as an integrated system — the substantive provisions define the technical characteristics that matter for a given transaction, and FINRA Rule 11220 ensures those characteristics, when applicable, are captured in the transaction's foundational comparison or confirmation document, where both parties can verify their agreement as to those characteristics before the transaction proceeds toward settlement.
FINRA Rule 11220's amendment history — showing an amendment effective March 18, 1993, predating the rule's 2010 transfer into the Consolidated FINRA Rulebook — places this amendment within the same general timeframe as several other Uniform Practice Code provisions whose amendment histories this dictionary has examined, including FINRA Rule 11120's SR-NASD-91-13 amendment effective November 1, 1991 and FINRA Rule 11150's identical 1991 amendment. While the specific substantive content of the March 1993 amendment to FINRA Rule 11220 is not separately confirmed beyond its effective date, its timing — falling shortly after this broader early-1990s wave of Uniform Practice Code modernization amendments confirmed in Notice to Members 91-63 — suggests it may represent a continuation of that modernization effort, potentially reflecting the addition or refinement of specific illustrative phrases such as Canadian funds or with proxy as the over-the-counter market's transaction characteristics evolved during that period.
FINRA Rule 11220 connects to FINRA Rule 11100(d) — whose CUSIP number requirement for the Uniform Comparison or Confirmation operates alongside, and is supplemented by, FINRA Rule 11220's additional description, price, and other-information content requirements. It connects directly and by explicit cross-reference to FINRA Rule 11210 — both as the rule whose Uniform Comparison or Confirmation FINRA Rule 11220's content requirements apply to, and as the rule whose paragraph (d)(1) alternative DK procedure explicitly incorporates FINRA Rule 11220's content requirements for trade-identifying notices. It connects to FINRA Rule 11140 — whose ex-dividend, ex-rights, ex-warrants, and ex-stock concepts are directly reflected in FINRA Rule 11220's illustrative ex-warrants and ex-stock phrases. It connects to FINRA Rule 11150 — whose flat-trading framework for bonds is directly reflected in FINRA Rule 11220's illustrative flat phrase. It connects to FINRA Rule 11170 — whose part-redeemed bonds framework is directly reflected in FINRA Rule 11220's illustrative part-redeemed phrase. And it connects to FINRA Rule 11500 — the upcoming Delivery of Securities with Restrictions subsection, whose registered securities framework is directly reflected in FINRA Rule 11220's illustrative registered phrase.
FINRA Rule 11220 is tested on the Series 7 and Series 24 examinations as the description-of-securities content requirements rule completing the 11200 subsection — a brief but interpretively significant provision whose illustrative phrases serve as a cross-reference index into the Uniform Practice Code's substantive terminology.
The key points to retain are these: FINRA Rule 11220 requires every Uniform Comparison or Confirmation under FINRA Rule 11210 to include three categories of content — an adequate description of the security, including payment options on a unit investment trust series; the price at which the transaction was made; and any other information deemed necessary to ensure that the buyer and seller agree as to details of the transaction; the rule's illustrative — explicitly non-exhaustive — list of other-information phrases includes ex-warrants and ex-stock, corresponding to FINRA Rule 11140's ex-date framework; flat, corresponding to FINRA Rule 11150's bonds-dealt-flat framework; part-redeemed, corresponding to FINRA Rule 11170's settlement price formula for part-redeemed bonds; registered, corresponding to the FINRA Rule 11500 subsection's registered securities framework; Canadian funds, addressing cross-border currency-denomination issues; and with proxy, addressing proxy voting rights transfer; FINRA Rule 11210(d)(1) explicitly incorporates FINRA Rule 11220's content requirements for the alternative DK procedure's trade-identifying notices; and the rule was amended effective March 18, 1993 and by SR-FINRA-2010-030 effective December 15, 2010 — no amendments since — with two selected notices, 83-69 and 10-49.
