Regulation NMS
Overview
The Securities and Exchange Commission ("Commission') is adopting rules under Regulation NMS and two amendments to the joint industry plans for disseminating market information. In addition to redesignating the national market system rules previously adopted under Section 11A of the Securities Exchange Act of 1934 ("Exchange Act'), Regulation NMS includes new substantive rules that are designed to modernize and strengthen the regulatory structure of the U.S. equity markets. First, the "Order Protection Rule' requires trading centers to establish, maintain, and enforce written policies and procedures reasonably designed to prevent the execution of trades at prices inferior to protected quotations displayed by other trading centers, subject to an applicable exception. To be protected, a quotation must be immediately and automatically accessible. Second, the "Access Rule' requires fair and non-discriminatory access to quotations, establishes a limit on access fees to harmonize the pricing of quotations across different trading centers, and requires each national securities exchange and national securities association to adopt, maintain, and enforce written rules that prohibit their members from engaging in a pattern or practice of displaying quotations that lock or cross automated quotations. Third, the "Sub-Penny Rule' prohibits market participants from accepting, ranking, or displaying orders, quotations, or indications of interest in a pricing increment smaller than a penny, except for orders, quotations, or indications of interest that are priced at less than $1.00 per share. Finally, the Commission is adopting amendments to the "Market Data Rules' that update the requirements for consolidating, distributing, and displaying market information, as well as amendments to the joint industry plans for disseminating market information that modify the formulas for allocating plan revenues ("Allocation Amendment') and broaden participation in plan governance ("Governance Amendment').
Prior Actions
Final Rule (34-52196)
70 FR 45529
Final Rule (34-51808A)
71 FR 232
Final Rule (34-55160)
72 FR 4202
Final Rule (34-53829)
71 FR 30037
Final Rule (34-52355)
70 FR 52014
Proposed Rule (34-49325)
69 FR 11125
Proposed Rule (34-49749)
69 FR 30141
Resources
Details
August 29, 2005
See section VII of this
70 FR 37495