FINRA's Board of Governors will meet 12/8 to consider a full slate of rulemaking issues - beginning with controls and diligence required of broker-dealers who use "Third-Party Service Providers."  The Board will consider a proposed new rule that not only would require controls and diligence, but would clarify that responsibility for those functions ultimately resides with the firm through the supervision of an associated person.   Here's what else the Board will consider - with details after the jump:

• Private Placements
• Debt Research Conflicts of Interest
• Short Interest Reporting
• Minimum Quotation Sizes
• Consolidated FINRA Registration Rules
• Replies to Responses to Motions
• Panel Composition in Industry Disputes Involving Promissory Notes

    3.  Debt Research Conflicts of Interest.   A concept for a new debt research conflicts of interest rule, which presents a tiered approach to regulating debt research reports and research analysts, depending on whether the research reports are distributed to an audience that includes retail investors or to an institution-only audience.

    4.  Short Interest Reporting.   Amendments to FINRA Rule 4560, Short Interest Reporting, designed to facilitate more consistent calculation of short interest positions for surveillance and market information purposes.

    5.  Minimum Quotation Sizes.   Amendments to FINRA Rule 6450, Minimum Quotation Size Requirements for OTC Equity Securities, to ensure quotations in lower-priced securities represent a minimum aggregate $-value commitment and to better align with the minimums in place for listed stocks.

    6.  Consolidated FINRA Registration Rules.   A summary of comments received on RegNote 09-70, which proposed consolidated registration and qualification rules - based on 22 comment letters in response to the Notice, which are available on FINRA’s website.

    7.  Replies to Responses to Motions.   Amendments to FINRA Codes of Arbitration Procedure that specify a 5-day period to reply to a response to a motion - i.e., procedural device that parties use to bring a contested issue before a panel.  The aim is to give all parties an opportunity to brief fully the issues in dispute, and to ensure that arbitrators will have all of the motion papers before issuing a final decision on the motion.

    8.  Panel Composition in Industry Disputes Involving Promissory Notes.   Amendments to FINRA Code of Arbitration Procedure for Industry Disputes to appoint chair-qualified, public arbitrators to resolve expedited disputes involving solely promissory notes instead of arbitrators qualified to hear statutory-discrimination claims.  The aim is to ensure that FINRA has a sufficient number of qualified arbitrators readily available to resolve these matters.

After the 12/8/10 meeting, FINRA will notify firms via email about the Board’s actions on these items and anticipated next steps, if any.    [FINRA B.O.G., 12/1]