NASD Notice to Members 07-19 - April 2007

SEC Approves Amendments to Expand IM-2110-2 to Include OTC Equity Securities; Effective Date: July 26, 2007

Executive Summary

On February 26, 2007, the Securities and Exchange Commission (SEC) approved amendments to Interpretive Material (IM) 2110-2, Trading Ahead of Customer Limit Order, to apply to over-the-counter (OTC) equity securities.1 The amendments also modify the minimum price improvement standards set forth in IM-2110-2 with respect to both NMS stocks and OTC equity securities. IM-2110-2, as amended, is set forth in Attachment A of this Notice. The amendments become effective on July 26, 2007.

 

Questions regarding this Notice may be directed to the Market Regulation Legal Section at (240) 386-5126, or the Office of General Counsel at (202) 728-8071.

 

1 See Securities Exchange Act Release No. 55351 (February 26, 2007), 72 FR 9810 (March 5, 2007) (order approving SR-NASD-2005-146).

 

Please note: The effective date of the expansion of IM-2110-2 to include OTC equity securities, which was approved as part of SR-NASD-2005-146, is delayed until 60 days after SEC approval of the proposed changes in SR-NASD-2007-041. Certain other amendments approved as part of SR-NASD-2005-146 became effective on July 26, 2007. For further information, see SR-FINRA-2007-038. See also File Nos. SR-FINRA-2007-023 and SR-NASD-2007-039.