November 22, 1996



Alfred R. Berkeley
President
The Nasdaq Stock Market, Inc.
1735 K Street, NW
Washington, DC  20006

          RE:  Immediate Display of Customer Limit Orders

Dear Mr. Berkeley:

     On the basis of representations made by you and other
industry participants,-[1]- it appears that a number of
industry participants will not have completed systems changes
necessary to comply with the display requirements of the
Commission's recently adopted Limit Order Display Rule ("Display
Rule")-[2]- by the effective date of the rule.

     Newly adopted Rule 11Ac1-4 ("Display Rule") becomes
effective January 10, 1997.  The Display Rule will require over-
the-counter ("OTC") market makers and exchange specialists to
display immediately customer limit orders for securities covered
by the rule if no stated exception applies.  In the Adopting
Release, the Commission stated that to display "immediately" in
this context means that the market maker or specialist must
display the order as soon as is practicable after receipt which,
under normal market conditions, would require display no later
than 30 seconds after receipt. 

     According to your letter and the discussions mentioned
above, certain necessary systems enhancements may not be in place
by January 10, 1997, to afford market makers and specialists the
means to comply in all instances with the 30-second display
standard for all limit orders they are required to display.  

---------FOOTNOTES----------
-[1]-  See letter from Alfred R. Berkeley, President, Nasdaq, to 
Richard R. Lindsey,  Director, Division  of Market Regulation, 
SEC, dated November 18, 1996; and letter from Eugene Lopez,
Assistant General Counsel,  Nasdaq, to  Richard  R. Lindsey, 
Director, Division of Market Regulation,  SEC, dated  November
19, 1996  (clarifying and expanding the letter dated November 18,
1996). 

-[2]-  Securities Exchange Act Release No. 37619A (September 6,
1996), 61 FR 48290 (September 12, 1996) ("Adopting Release").
==========================================START OF PAGE 2======

      On the basis of the facts presented, the Division of Market
Regulation ("Division") will not recommend enforcement action to
the Commission under Section 11A(c) or Rule 11Ac1-4 thereunder,
with respect to an OTC market maker or exchange specialist that,
due to the technology available to it, is not able to display a
customer limit order within 30 seconds of receipt. This no-action
position is strictly conditioned on the market maker or
specialist taking action to display the order as soon as is
practicable under these circumstances.  This no-action position
will expire on April 10, 1997.  

     The Division understands that current exchange systems
enable the display of the great majority of customer limit orders
within the 30-second time frame.  The Division expects each
exchange to be vigilant to ensure that its specialists comply
with the 30-second display standard in all cases where it is
possible to do so.  

     This is a position of the Division regarding enforcement
action under Section 11A of the Exchange Act only, and does not
express any legal conclusions regarding the applicability of
Section 11A of the Exchange Act or other statutory or regulatory
provisions of the federal securities laws.  This no-action
position is subject to changes in current law, regulation, and
interpretations; any change may require the Division to
reevaluate and withdraw or modify this no-action position. 
Because these positions are based on the representations made to
the Division, any different facts or conditions might require
different conclusions.

                                   Sincerely,



                                   Richard R. Lindsey
                                   Director