SEC Issues Policy Statement on Business Continuity Planning for Trading Markets


Washington, D.C., September 26, 2003 — The Securities and Exchange Commission has issued a Policy Statement setting forth its view that self-regulatory organizations operating trading markets (SRO Markets) and electronic communication networks (ECNs) should apply certain basic principles in their business continuity planning. The Commission also requests comments on the Policy Statement.

The principles outlined in the Policy Statement include planning for the resumption of trading no later than the next business day following a wide-scale disruption, geographic diversity between primary and backup sites, assuring the full resilience of important shared information systems (such as the consolidated market data stream), and confirming the effectiveness of backup arrangements through testing. Each SRO Market and ECN should implement plans reflecting these principles as soon as practicable, and strive to do so by the end of 2004. Commission staff intends to engage in an ongoing and individualized dialogue with each SRO Market and ECN to discuss application of these principles in a manner most appropriate for the particular trading market.

The Commission believes it important for the SRO Markets and ECNs to take concrete steps to strengthen their resilience to address the continuing, serious risks to the U.S. financial system posed by the post-September 11 environment. To date, the trading markets have made significant progress in increasing the robustness of their business continuity plans. By applying the principles outlined in the Policy Statement, the Commission believes the SRO Markets and ECNs will better assure their own resilience and that of the U.S. financial system.

The Policy Statement can be accessed on the SEC's Web site at