SR-NASD-2000-020

Amendments to Rule 2320(g) and Rule 3110(b)

The NASD, through its wholly owned subsidiary, NASD Regulation, Inc., has filed with the SEC a proposed rule change to amend Rules 2320(g) and 3110(b) to: (1) require that members executing a customer order in a non-Nasdaq security contact and obtain quotations from three dealers (or all dealers if three or less) to determine the best inter-dealer market for the security, unless two or more priced quotations are displayed in an inter-dealer quotation system that permits quotation updates on a real-time basis (such as the OTC Bulletin Board ("OTCBB") or the electronic pink sheets); (2) require that members that display priced quotations for the same non-Nasdaq security in two or more quotation mediums that permit quotation updates on a real-time basis display the same priced quotations for the security in each quotation medium; (3) no longer require that a member indicate on the order ticket for each transaction in a non-Nasdaq security the name of each broker/dealer contacted and the quotations received if two or more priced quotations are displayed and NASD Regulation has access, on a historical basis, to the quotation data; and (4) define the terms "inter-dealer quotation system" and "quotation medium" for the purposes of the proposed rule change.