The Financial Industry Regulatory Authority, Inc. recently proposed new “pay-to-play” rules that would regulate the activities of FINRA member firms engaging in distribution or solicitation activities with government entities on behalf of investment advisers. The proposal is modeled after and intended to address a provision of Rule 206(4)-5 under the Investment Advisers Act of 1940. Effective April 1, 2015, the Advisers Act rule will prohibit an investment adviser from paying a FINRA member firm to solicit a government entity for investment advisory services unless the FINRA member firm is subject to an equivalent FINRA pay-to play rule or otherwise meets the definition of a “regulated person” under the Advisers Act rule. The FINRA Pay-to-Play Rules are designed to address this requirement under the Advisers Act rule. FINRA is proposing Rule 2271 (Disclosure Requirement for Government Distribution and Solicitation Activities), Rule 2390 (Engaging in Distribution and Solicitation Activities with Government Entities) and Rule 4580 (Books and Records Requirements for Government Distribution and Solicitation Activities). Comments on the proposal are due by December 15, 2014.