Publication or Submission of Quotations Without Specified Information

Rule 15c2-11 B. Conforming Amendments 1. Specified and Supplemental Information 2. Exceptions 3. Record Preservation Requirements C. Technical Amendments III. General Request for Comment IV. Economic Analysis A. Baseline 1. Regulatory Baseline 2. Affected Securities 3. Affected Parties B. Benefits and Costs 1. Affected Brokers, Dealers, QIDQSs, and RNSAs 2. Affected Issuers 3. Affected Investors C. Efficiency, Competition, and Capital Formation D. Reasonable Alternative 1. Except Crypto Securities That Are Equity Securities E. Request for Comment V. Paperwork Reduction Act A. Introduction B. Rule 15c2-11 C. Collection of Information D. Respondents 1. Respondents Related to Rule 15c2-11's Information Gathering and Review Requirements and Corresponding Record Preservation Requirements 2. Respondents Related to Rule 15c2-11's Exceptions and Corresponding Record Preservation Requirements 3. Respondents Related to Other Record Preservation Requirements 4. Respondents Related to a QIDQS's or RNSA's Written Policies and Procedures E. Use of Information F. Collections of Information for Equity Quotations 1. Burden Estimates Related to Rule 15c2-11(a)(1)(i), (a)(2), (d)(1)(i)(A), and (d)(1)(i)(B)—Broker or Dealer or QIDQS Information Gathering and Review Requirements and Corresponding Record Preservation Requirements 2. Burden Estimates Related to Rule 15c2-11's Exceptions and Corresponding Record Preservation Requirements 3. Burden Estimates Related to Other Record Preservation Requirements 4. Burden Estimates Related to Rule 15c2-11(a)(3)—QIDQS or RNSA Written Policies and Procedures for Making Publicly Available Determinations G. Collection of Information Would Be Mandatory H. Confidentiality of Responses to Collection of Information I. Retention Period for Record Preservation Requirement J. Request for Comment VI. Present Values and Annualized Values of Monetized Benefits and Costs VII. Regulatory Flexibility Act Certification VIII. Congressional Review Act IX. Other Matters I

r Making Publicly Available Determinations G. Collection of Information Would Be Mandatory H. Confidentiality of Responses to Collection of Information I. Retention Period for Record Preservation Requirement J. Request for Comment VI. Present Values and Annualized Values of Monetized Benefits and Costs VII. Regulatory Flexibility Act Certification VIII. Congressional Review Act IX. Other Matters I. Introduction

Rule 15c2-11 requires that brokers and dealers give some measure of attention to financial and other information about the issuer of a security before commencing trading in that security. 2 To that end, Rule 15c2-11 requires, subject to exceptions, 3 a broker or dealer, before initiating (or resuming) any quotation for a security in a quotation medium, 4 to gather specified information regarding the security and its issuer and, 5 based upon a review of such information, along with certain supplemental information, 6 to have a reasonable basis under the circumstances for believing that such information is accurate and is from a reliable source. 7 Alternatively, a broker or dealer may submit a quotation in a quotation medium that is a qualified interdealer quotation system (“QIDQS”) 8 that has made a publicly available determination that it has performed certain information gathering and review requirements, 9 if certain conditions are met. 10 Rule 15c2-11 also includes certain record preservation requirements. 11

2 A broader purpose of Rule 15c2-11, however, is to prohibit brokers and dealers from establishing arbitrary quotations for infrequently traded over-the-counter (“OTC”) securities in the absence of certain information. See Initiation or Resumption of Quotations Without Specified Information, Exchange Act Release No. 21470 (Nov. 8, 1984) [49 FR 45117 (Nov. 15, 1984)] (“1984 Release”), 49 FR 45117-18. See also Initiation or Resumption of Quotations by a Broker or Dealer Who Lacks Certain Information, Exchange Act Release No. 9310 (Sept. 13, 1971) [36 FR 18641 (Sept

securities in the absence of certain information. See Initiation or Resumption of Quotations Without Specified Information, Exchange Act Release No. 21470 (Nov. 8, 1984) [49 FR 45117 (Nov. 15, 1984)] (“1984 Release”), 49 FR 45117-18. See also Initiation or Resumption of Quotations by a Broker or Dealer Who Lacks Certain Information, Exchange Act Release No. 9310 (Sept. 13, 1971) [36 FR 18641 (Sept. 18, 1971)] (“1971 Release”), 36 FR 18641 (“[B]rokers and dealers should be aware that the submission or publication of a quotation at a price which does not bear a reasonable relationship to the nature and scope of the issuer's business or its financial status or experience, may constitute a part of a fraudulent or manipulative scheme.”).

3 See 17 CFR 240.15c2-11(f).

4 See 17 CFR 240.15c2-11(e)(8) (defining the term “quotation medium” to mean any “interdealer quotation system” or any publication or electronic communications network or other device that is used by brokers or dealers to make known to others their interest in transactions in any security, including offers to buy or sell at a stated price or otherwise, or invitations of offers to buy or sell).

5 See 17 CFR 240.15c2-11(b) (“Rule 15c2-11(b)”).

6 See 17 CFR 240.15c2-11(c) (“Rule 15c2-11(c)”).

7 See 17 CFR 240.15c2-11(a) (“Rule 15c2-11(a)”).

8 See 17 CFR 240.15c2-11(e)(6).

9 See 17 CFR 240.15c2-11(a)(1)(ii).

10 See 17 CFR 240.15c2-11(a)(2).

11 See 17 CFR 240.15c2-11(d) (“Rule 15c2-11(d)”).

Rule 15c2-11 applies to quotations for securities

vitations of offers to buy or sell).

5 See 17 CFR 240.15c2-11(b) (“Rule 15c2-11(b)”).

6 See 17 CFR 240.15c2-11(c) (“Rule 15c2-11(c)”).

7 See 17 CFR 240.15c2-11(a) (“Rule 15c2-11(a)”).

8 See 17 CFR 240.15c2-11(e)(6).

9 See 17 CFR 240.15c2-11(a)(1)(ii).

10 See 17 CFR 240.15c2-11(a)(2).

11 See 17 CFR 240.15c2-11(d) (“Rule 15c2-11(d)”).

Rule 15c2-11 applies to quotations for securities. 12 However, several exceptions 13 and exemptions 14 apply to certain broker or dealer activities, including: quotations for securities admitted to trading on a national securities exchange; 15 quotations that represent a customer's unsolicited indication of interest (“unsolicited quotation exception”); 16 quotations published or submitted in an interdealer quotation system for a security that has been the subject of a bid or offer quotation in such a system at a specified price, with no more than four business days in succession without such a quotation (“piggyback exception”); 17 quotations for municipal securities; 18 quotations for securities that meet certain average daily trading volume (“ADTV”) value and total asset and shareholder equity criteria (“ADTV and asset test exception”); 19 quotations for a security by a broker or dealer that is named as an underwriter in a registration statement or offering statement for that class of security (“underwritten offering exception”); 20 and quotations that rely on a publicly available determination by a QIDQS or registered national securities association (“RNSA”) that the requirements of certain of these exceptions are met. 21 Rule 15c2-11 does not apply to certain exempted securities, 22 including, among others, certain government securities, such as securities which are direct obligations of, or obligations guaranteed as to principal or interest by, the United States

ion of the 2020 amendments to Rule 15c2-11, 27 numerous industry participants stated that they never understood Rule 15c2-11 to apply to non-equity securities and expressed concerns with the potential burdens of applying the amended rule to fixed-income securities. 28 In 29 FINRA has always structured its rule to apply to only equity securities that are not traded on a national securities exchange. 30 After industry participants shared their concerns regarding Rule 15c2-11's application, the Commission provided exemptive relief and the staff issued a no-action letter addressing the vast majority of fixed-income securities. 31

25 See 1971 Release, 36 FR 18641 (“fraudulent and manipulative potential . . . exists when a broker or dealer submits quotations concerning any infrequently traded security in the absence of certain information”); Initiation or Resumption of Quotations Without Specified Information, Exchange Act Release No. 19673 (Apr. 14, 1983) [48 FR 17111 (Apr. 21, 1983)] (“1983 Release”), 48 FR 17112.

26 See Exchange Act Release No. 89891 (Sept. 16, 2020) [85 FR 68124 (Oct. 27, 2020)] (“2020 Release”), 85 FR 68140.

27 See supra note 26.

28 See generally Letter from Christopher B. Killian, Managing Director, Securities Industry and Financial Markets Assoc. (“SIFMA”) and Lindsey Weber Keljo, Managing Director, Securities Industry and Financial Markets Assoc.—Asset Management Group (“SIFMA AMG”) (Mar. 2, 2026) (“SIFMA Letter”); Letter from Paul Cellupica, General Counsel, Investment Company Institute (“ICI”) and Lindsey Weber Keljo, Managing Director, SIFMA AMG (Nov. 21, 2024) (“ICI Letter”), available at https://www.ici.org/system/files/2024-11/24-cl-joint-rule-15c2-11-extension.pdf; Letter from Kristi Leo, President, Structured Finance Assoc. (“SFA”) (Dec. 9, 2021) (“SFA Letter”), available at https://structuredfinance.org/wp-content/uploads/2021/12/SFA_15c2-11_vf_website-1.pdf; Group Letter from Lindsey Weber Keljo, Managing Director, SIFMA AMG, et al. (Sept

ity” and “securities” with the terms “equity security” or “equity securities.” Under the proposal, “equity security” (or “equity securities”) would be as defined in 17 CFR 240.3a11-1” (“Rule 3a11-1”).

32 See 144A Exemptive Release; 2024 No-Action Letter.

33 See Publication or Submission of Quotations Without Specified Information, Exchange Act Release No. 39670 (Feb. 17, 1998) [63 FR 9661 (Feb. 25, 1998)] (“1998 Release”), 63 FR 9669 (stating that “[d]ebt securities frequently are held by institutional investors, and it does not appear that they have been the subject of the abuses that [Rule 15c2-11] is intended to address”); Publication or Submission of Quotations Without Specified Information, Exchange Act Release No. 41110 (Feb. 25, 1999) [64 FR 11124 (Mar. 8, 1999)] (“1999 Release”), 64 FR 11128-30 (stating that “applying [Rule 15c2-11] to . . . certain fixed-income debt securities is not directly related to microcap fraud concerns” and “proposing to exclude [from Rule 15c2-11] debt securities, non-participatory preferred stock, and investment grade asset-backed securities”); 2019 Release, 84 FR 58230, 58239.

II. Discussion of the Proposed Rule Amendments

A. Amendments to Rule 15c2-11

The proposed amendments would replace the terms “security” and “securities” in Rule 15c2-11 with the terms “equity security” or “equity securities,” as defined in Rule 3a11-1, 34 but would not otherwise change the substantive information gathering and review requirements under existing Rule 15c2-11(a) that brokers and dealers must satisfy before initiating (or resuming) any quotation for equity securities in a quotation medium

replace the terms “security” and “securities” in Rule 15c2-11 with the terms “equity security” or “equity securities,” as defined in Rule 3a11-1, 34 but would not otherwise change the substantive information gathering and review requirements under existing Rule 15c2-11(a) that brokers and dealers must satisfy before initiating (or resuming) any quotation for equity securities in a quotation medium.

34 Rule 3a11-1 defines “equity security” as “any stock or similar security, certificate of interest or participation in any profit sharing agreement, preorganization certificate or subscription, transferable share, voting trust certificate or certificate of deposit for an equity security, limited partnership interest, interest in a joint venture, or certificate of interest in a business trust; any security future on any such security; or any security convertible, with or without consideration into such a security, or carrying any warrant or right to subscribe to or purchase such a security; or any such warrant or right; or any put, call, straddle, or other option or privilege of buying such a security from or selling such a security to another without being bound to do so.” See 17 CFR 240.3a11-1.

Exchange Act Rule 3a11-1 includes a broad range of equity interests 35 and provides more specificity than 15 U.S.C. 78c(a)(11) (“section 3(a)(11)”), which also defines the term “equity security.” 36 Leveraging the definition in Rule 3a11-1 should provide more clarity with respect to which securities are subject to the rule than referencing the statutory definition. In addition, Rule 3a11-1 provides a definition that should be familiar to issuers who are tracking their obligations under Exchange Act section 12(g). Accordingly, the Commission is proposing to amend paragraph (a)(1) of Rule 15c2-11 by replacing the word “security” with “an equity security as defined in §  240.3a11-1 of this chapter.” 37

35 See Equity Securities; Exemptions from Registration, Exchange Act Release No. 7581 (Apr. 23, 1965) [30 FR 6114 (Apr

familiar to issuers who are tracking their obligations under Exchange Act section 12(g). Accordingly, the Commission is proposing to amend paragraph (a)(1) of Rule 15c2-11 by replacing the word “security” with “an equity security as defined in §  240.3a11-1 of this chapter.” 37

35 See Equity Securities; Exemptions from Registration, Exchange Act Release No. 7581 (Apr. 23, 1965) [30 FR 6114 (Apr. 30, 1965)] 30 FR 6114-15.

36 Exchange Act section 3(a)(11) defines the term “equity security” to mean “any stock or similar security; or any security future on any such security; or any security convertible, with or without consideration, into such a security, or carrying any warrant or right to subscribe to or purchase such a security; or any such warrant or right; or any other security which the Commission shall deem to be of similar nature and consider necessary or appropriate, by such rules and regulations as it may prescribe in the public interest or for the protection of investors, to treat as an equity security.”

37 See infra Part IX including proposed amended Rule 15c2-11(a)(1).

As discussed below, Rule 3a11-1 defines the term “equity security” as used in Exchange Act section 12(g), 38 which is one of the triggers of the information requirements specified in Rule 15c2-11(b). 39 Accordingly, under the proposal, Rule 15c2-11 would continue to apply to brokers and dealers initiating (or resuming) quotations in a quotation medium for any equity security as defined in Rule 3a11-1. 40 The Commission is also proposing conforming amendments to other provisions of the rule, such as the specified and supplemental information in Rule 15c2-11(b) and Rule 15c2-11(c), respectively, that must be reviewed, as well as to the rule's record preservation requirements and exceptions in Rule 15c2-11(d) and Rule 15c2-11(f), respectively, to specify that only equity securities would be subject to these provisions. The Commission is also proposing non-substantive, grammatical corrections to three provisions of the rule

l information in Rule 15c2-11(b) and Rule 15c2-11(c), respectively, that must be reviewed, as well as to the rule's record preservation requirements and exceptions in Rule 15c2-11(d) and Rule 15c2-11(f), respectively, to specify that only equity securities would be subject to these provisions. The Commission is also proposing non-substantive, grammatical corrections to three provisions of the rule.

38 See supra note 35.

39 See 17 CFR 240.15c2-11(b)(3), (b)(4).

40 17 CFR 240.3a11-1. The other provisions of Rule 15c2-11 would continue to apply, including the exceptions in paragraph (f).

Regarding the proposed amendments' application to crypto assets, 41 to the extent a crypto asset is an equity security, as defined in Rule 3a11-1, Rule 15c2-11 would apply to brokers and dealers initiating (or resuming) quotations for those crypto assets in a quotation medium.

41 A “crypto asset” is any digital representation of value that is recorded on a cryptographically secured distributed ledger. The foregoing definition of “crypto asset” is identical to the definition of “Digital Asset” in section 2(6) of the Guiding and Establishing National Innovation for U.S. Stablecoins Act, Public Law 119-27, 139 Stat. 419 (2025).

By proposing to revise Rule 15c2-11 to refer to only equity securities, the Commission does not intend to, and the proposed rule would not, excuse brokers and dealers from their duty to comply with applicable registration 42 43

42 For example, Rule 15c2-11 has no bearing on whether brokers or dealers may rely on the section

43 See, e.g., 1971 Release, 36 FR 18641. See also 1999 Release, 64 FR 11147.

The Commission proposes a compliance date for the proposed amendments that is the same as the effective date, and an effective date that is 60 days after publication of the proposed amendments in the Federal Register . This approach would limit the amount of time before the applicability of Rule 15c2-11's proposed revision to refer to only equity securities, as defined in Rule 3a11-1

4 FR 11147.

The Commission proposes a compliance date for the proposed amendments that is the same as the effective date, and an effective date that is 60 days after publication of the proposed amendments in the Federal Register . This approach would limit the amount of time before the applicability of Rule 15c2-11's proposed revision to refer to only equity securities, as defined in Rule 3a11-1.

In proposing to revise Rule 15c2-11 to refer to only equity securities, the Commission recognizes that the regulatory concerns that prompted the Commission's adoption of and subsequent amendments to Rule 15c2-11 were manipulative schemes observed in the OTC equity markets, particularly for the shares of issuers with little or no business activity or assets. 44 The Commission stated when adopting Rule 15c2-11 in 1971 that “these concerns exist when a broker or dealer submits quotations concerning any infrequently traded security in the absence of certain information.” 45 Therefore, the rule was designed to prevent brokers and dealers from initiating market making activities that were critical to the success of certain manipulative and fraudulent trading schemes with a focus on the OTC equity markets. 46

44 See Spin Offs and Shell Corporations, Exchange Act Release No. 8638 (July 2, 1969) [34 FR 11581 (July 15, 1969)]. See also 1983 Release, 48 FR 17111-12; Initiation or Resumption of Quotations Without Specified Information, Exchange Act Release No. 27247 (Sept. 14, 1989) [54 FR 39194 (Sept. 25, 1989)] (“1989 Release”), 54 FR 39195; Initiation or Resumption of Quotations Without Specified Information, Exchange Act Release No. 29094 (Apr. 17, 1991) [56 FR 19148 (Apr. 25, 1991)] (“1991 Release”), 56 FR 19159; 1999 Release, 64 FR 11148, 11150; Publication or Submission of Quotations Without Specified Information, Exchange Act Release No. 87115 (Sept. 25, 2019) [84 FR 58206 (Oct. 30, 2019)] (“2019 Release”), 84 FR 58219.

45 1971 Release, 36 FR 18641.

46 See 1971 Release, 36 FR 18641; 1983 Release, 48 FR 17112

lease No. 29094 (Apr. 17, 1991) [56 FR 19148 (Apr. 25, 1991)] (“1991 Release”), 56 FR 19159; 1999 Release, 64 FR 11148, 11150; Publication or Submission of Quotations Without Specified Information, Exchange Act Release No. 87115 (Sept. 25, 2019) [84 FR 58206 (Oct. 30, 2019)] (“2019 Release”), 84 FR 58219.

45 1971 Release, 36 FR 18641.

46 See 1971 Release, 36 FR 18641; 1983 Release, 48 FR 17112.

The Commission also previously explored whether to explicitly except non-equity securities, particularly fixed-income securities, from the rule. For instance, in requesting comment in the 1999 Release as to whether to except fixed-income securities from the rule, the Commission stated that the type of issuer information required by Rule 15c2-11 is much less relevant to the pricing and trading of fixed-income securities. 47 In that proposal, the Commission also stated that fraud and manipulation in microcap securities has not been evident in the fixed-income market, and that non-convertible debt securities and investment grade asset-backed securities generally trade at prices and in denominations that make them less likely targets for manipulation. 48 Many commenters to the 1998 Release concurred, and asked that amendments be crafted to cover only those equity securities most likely to be prone to abusive activities. 49

47 See 1999 Release, 64 FR 11130.

48 See 1999 Release, 64 FR 11130.

49 See 1999 Release, 64 FR 11128. The Commission did not act on the proposal.

In 2020, the Commission amended Rule 15c2-11 to require that certain information about a security be current and publicly available for a broker or dealer to initiate (or resume) a quotation for it. 50 In doing so, the Commission stated that it was seeking to further protect retail investors from fraud and manipulation in the OTC market

e, 64 FR 11128. The Commission did not act on the proposal.

In 2020, the Commission amended Rule 15c2-11 to require that certain information about a security be current and publicly available for a broker or dealer to initiate (or resume) a quotation for it. 50 In doing so, the Commission stated that it was seeking to further protect retail investors from fraud and manipulation in the OTC market. 51 While these amendments were intended to enhance protections for retail investors in equity securities, 52 such as by requiring that the information be both current and publicly available, they created potential operational and liquidity difficulties with regard to non-equity securities, for which the applicable information was less likely to be current and publicly available. 53

50 See 2020 Release.

51 See 2020 Release, 85 FR 68128.

52 See 2020 Release, 85 FR 68125.

53 See, e.g., SIFMA AMG Group Letter, at 7 (addressing fixed-income securities); SFA Letter, at 4-5 (addressing asset-backed securities).

In 2023, the Commission issued exemptive relief for fixed-income securities sold in reliance on Rule 144A 54 because issuers of such securities must provide information to investors (including potential investors) upon request, and such investors—who must be qualified institutional buyers—would be able to use the provided information to make better informed investment decisions and assess potential risks in investing in the securities. 55 Market participants stated that, without relief, the amended rule would undermine its intended purpose because issuers of such securities would reduce information flow and possibly go dark because making such information available to the general public, rather than to only persons who are qualified to invest in such securities would, among other things, reveal confidential information. 56

54 17 CFR 230.144A. See also No. 33-6862 (Apr. 23, 1990), 55 FR 17933, 17939 n.55 (Apr

current Rule 15c2-11 information remains publicly available before initiating or resuming quotations—a requirement that did not exist prior to 2020. 60 Similar to the reasons behind the Commission's exemption for fixed-income securities sold under Rule 144A, investors in the securities covered by the no-action letter are often sophisticated or qualified investors. 61

57 See 2024 No-Action Letter. Although the Commission's exemptive relief and the staff's no-action letter address the vast majority of fixed-income securities, they do not encompass all non-equity securities. The 2024 No-Action Letter superseded staff no-action letters that were issued starting in 2021.

58 See SIFMA AMG Group Letter, at 6 (stating that for fixed-income securities “there is currently no infrastructure for compliance with the Rule”); SFA Letter, at 2 (stating that “Rule 15c2-11 information is not materially relevant to ABS and therefore such information is not available”); BDA Letter, at 4 (stating that “accurate volume data is not available [for fixed-income securities]”).

59 See, e.g., SIFMA Letter, at 6 (stating that “there is a party (a qualified interdealer quotation system, or QIDQS) in the OTC equity markets that makes determinations of public availability of information upon which dealers may rely for Rule 15c2-11 compliance. Since 2021, no vendors, SROs, bond exchanges or ATSs have stepped forward to take this role in the fixed-income [markets]”); supra note 58.

60 See, e.g., The Detriment of Rule 15c2-11's Application to Fixed Income Markets, Joe Corcoran, SIFMA (Sept. 12, 2022), available at https://www.sifma.org/news/blog/the-detriment-of-rule-15c2-11s-application-to-fixed-income-markets-the-consequences-of-unilateral-rulemaking-without-public-comment.

61 See ICI Letter, at 3 (“in the fixed income market . . . traders are overwhelmingly institutional investors”); SFA Letter, at 3 (“Unlike the equity markets which include substantial retail investment, the fixed income markets are largely institutional.”)

ews/blog/the-detriment-of-rule-15c2-11s-application-to-fixed-income-markets-the-consequences-of-unilateral-rulemaking-without-public-comment.

61 See ICI Letter, at 3 (“in the fixed income market . . . traders are overwhelmingly institutional investors”); SFA Letter, at 3 (“Unlike the equity markets which include substantial retail investment, the fixed income markets are largely institutional.”).

Further, many exceptions from Rule 15c2-11 available to equity securities 62 As the Commission has previously stated, such exceptions help reduce unnecessary burdens on brokers and dealers and enhance the efficiency of the OTC market. 63 For instance, Rule 15c2-11 includes an exception for securities listed on national securities exchanges if certain conditions are met, but few fixed-income securities are listed on a national securities exchange. 64 In addition, the exceptions that rely on the worldwide ADTV value, 65 or those premised on the frequency of quotations, 66 would not typically be available to non-equity securities because accurate volume data is often not available and such securities can be infrequently traded or quoted. The result is a more burdensome rule for non-equity securities.

62 See SIFMA AMG Group Letter, at 7 (requesting that the Commission “revise the Rule in a manner that is consistent with the structure of the [fixed-income] markets, with workable provisions and exceptions”).

63 See 2020 Release, 85 FR 68140.

64 See 17 CFR 240.15c2-11(f)(1). 15 U.S.C. 78l(g) (“section 12(g)”) of the Exchange Act applies to equity securities, making it more likely that current and publicly available information is readily available to brokers and dealers for review. See infra note 69.

65 See 17 CFR 240.15c2-11(f)(5).

66 See 17 CFR 240.15c2-11(f)(3).

Finally, the types of information required by the rule can be burdensome to locate or may be nonexistent for non-equity securities

”) of the Exchange Act applies to equity securities, making it more likely that current and publicly available information is readily available to brokers and dealers for review. See infra note 69.

65 See 17 CFR 240.15c2-11(f)(5).

66 See 17 CFR 240.15c2-11(f)(3).

Finally, the types of information required by the rule can be burdensome to locate or may be nonexistent for non-equity securities. As noted above, Rule 3a11-1 defines the term “equity security” as used in Exchange Act section 12(g), 67 which only applies to equity securities, 68 and registration pursuant to section 12(g) is one of the triggers for many of the information requirements specified in Rule 15c2-11(b). 69 Therefore, paragraph (b) information is more likely to be readily available to brokers and dealers with respect to equity securities than it is for non-equity securities, given the affirmative registration requirements imposed on certain issuers of equity securities, but not non-equity securities, by section 12(g). Section 12(g)(1) of the Exchange Act and 17 CFR 240.12g-1 (“Rule 12g-1”) promulgated thereunder generally require an issuer to register a class of equity securities if the issuer of the securities, at the end of its fiscal year, has more than $10,000,000 in total assets and a class of equity securities held of record by either 2,000 persons or 500 persons who are not accredited investors. 70 Every issuer of a class of equity securities registered pursuant to section 12(g) is required to file with the Commission periodic and current reports pursuant to section 13(a) of the Exchange Act, which would help to satisfy the paragraph (b)(3) information requirements

ing amendments to revise the rule to refer to only equity securities.

Request for Comments

The Commission generally requests comment from the public on this aspect of the proposal. More specific requests for comment are set forth below. As much as possible, commenters are requested to provide empirical data in support of any arguments or analyses and to offer explanations for their views.

Q1. The Commission is proposing to use the equity security definition in Rule 3a11-1. Does this definition provide adequate specificity to market participants as to Rule 15c2-11's scope? If not, what other amendment(s) to Rule 15c2-11 would be required to provide such specificity?

Q2. Is there another or alternative equity security definition that is more appropriate (than the definition in Rule 3a11-1) to be referenced in Rule 15c2-11? Please explain.

Q3. Should a definition of equity security be added to paragraph (e) of Rule 15c2-11?

Q4. If the Commission adds a definition of equity security to Rule 15c2-11, should the definition incorporate all of Rule 3a11-1's elements or only a subset of the different types of equity securities listed under Rule 3a11-1? For example, should the definition exclude security futures, which are required to be traded on a national securities exchange pursuant to 15 U.S.C. 78f(h)(1) (section 6(h)(1)) of the Exchange Act, or puts, calls, options or privileges? 73 Please explain.

73 See, e.g., Letter from Karl Trinko (Mar. 3, 2026), available at https://www.sec.gov/files/rules/petitions/2026/petn4-888.pdf (discussing the securities of certain royalty trusts).

B. Conforming Amendments

The Commission is proposing conforming amendments throughout Rule 15c2-11 in light of its proposal to revise Rule 15c2-11 to refer to only equity securities, as defined in Rule 3a11-1.

1

73 See, e.g., Letter from Karl Trinko (Mar. 3, 2026), available at https://www.sec.gov/files/rules/petitions/2026/petn4-888.pdf (discussing the securities of certain royalty trusts).

B. Conforming Amendments

The Commission is proposing conforming amendments throughout Rule 15c2-11 in light of its proposal to revise Rule 15c2-11 to refer to only equity securities, as defined in Rule 3a11-1.

1. Specified and Supplemental Information

Under the proposed amendments, documents and information concerning only equity securities would need to be gathered and reviewed in satisfying Rule 15c2-11's information gathering and review requirements, except with regard to the existing requirement in paragraph (c)(2) concerning any trading suspension order, issued by the Commission within a certain timeframe, regarding “any securities” of the security's issuer or its predecessor. 74 The documents and information that are required to be gathered and reviewed are specified, (1) with regard to issuers and their securities, in paragraph (b) of Rule 15c2-11 (“paragraph (b) information”) and, (2) with regard to certain supplemental information, in paragraph (c) of Rule 15c2-11 (“supplemental information”). 75

74 Reviewing the information in trading suspension orders, regardless of the type or class of securities to which the suspension applies, is important because it can apprise brokers and dealers of questions the Commission has raised regarding the issuer or its securities that should be considered when they determine to publish quotations. See 1991 Release, 56 FR 19154. Limiting the required review of trading suspension orders to only equity securities could prevent brokers and dealers from being alerted to the possibility that information in their possession concerning the issuer may no longer be accurate. See 1991 Release, 56 FR 19153

f satisfying Rule 15c2-11's information gathering and review requirements? Please explain.

79 See supra note 74.

2. Exceptions

In light of the Commission's proposal to revise Rule 15c2-11 to refer to only equity securities, the Commission is proposing conforming amendments to specify that Rule 15c2-11's conditional exceptions in paragraph (f) would cover quotations for only equity securities. Certain of these exceptions currently include the word “security.” The Commission is therefore proposing to add the word “equity” in front of the word “security” in the following paragraphs of Rule 15c2-11: paragraph (f)(1), with respect to quotations for securities traded on a national securities exchange; paragraphs (f)(3)(i)(A), (f)(3)(i)(B), (f)(3)(i)(B)( 2 ), (f)(3)(i)(C), and (f)(3)(ii), with respect to the “piggyback” exception for regular and frequent priced quotations; paragraphs (f)(5)(i) and (f)(5)(ii), with respect to quotations for securities that meet a specified ADTV value and asset test; and paragraph (f)(6), with respect to quotations for securities issued in underwritten offerings. 80 Rule 15c2-11's other exceptions—in paragraph (f)(2), concerning quotations representing a customer's unsolicited indication of interest, 81 and in paragraph (f)(7), concerning quotations published in reliance on a publicly available determination from a QIDQS or RNSA that the conditions of certain rule exceptions are met 82 —do not include the word “security” but, under the proposal, similarly would cover quotations for only equity securities.

80 The Commission is also proposing non-substantive, grammatical amendments to change the word “a,” which precedes the word “security” in the existing rule, to “an,” which would precede the words “equity security” in certain of these paragraphs: (f)(1), (f)(3)(i)(A), (f)(3)(i)(C), (f)(5)(i), and (f)(6)

See MSRB Rule G-47 (requiring brokers, dealers, and municipal securities dealers to disclose to customers at or prior to the time of trade all material information known or available publicly through established industry sources).

Request for Comments

The Commission generally requests comment from the public on this aspect of the proposal. More specific requests for comment are set forth below. As much as possible, commenters are requested to provide empirical data in support of any arguments or analyses and to offer explanations for their views.

Q6. Should Rule 15c2-11 continue to include an exception for municipal securities, in paragraph (f)(4), if Rule 15c2-11 were revised to refer to only equity securities? What would be the purpose or advantage of preserving such an exception if Rule 15c2-11 referred to only equity securities? Do commenters know of, or anticipate the possibility of, any municipal securities being structured in a way that meets the definition of the term “equity security,” as defined in Rule 3a11-1?

3. Record Preservation Requirements

Paragraph (d) of Rule 15c2-11 sets forth requirements for any broker, dealer, QIDQS, or RNSA to preserve 84 In light of the proposal to revise Rule 15c2-11 to refer to only equity securities, the Commission is proposing conforming amendments to specify the scope of Rule 15c2-11's record preservation requirements, some of which currently include the word “security.” The Commission is therefore proposing to add the word “equity” in front of the word “security” in paragraphs (d)(1)(i)(A) and (d)(1)(i)(B) of Rule 15c2-11, which pertain to supporting documents and information for the information gathering and review requirements. 85 Rule 15c2-11's other record preservation requirements 86 currently do not include the word “security” but, under the proposal, similarly would be applied only with respect to brokers' or dealers' quotations for equity securities or any QIDQS's or RNSA's publicly available determinations regarding equity securities

documents and information for the information gathering and review requirements. 85 Rule 15c2-11's other record preservation requirements 86 currently do not include the word “security” but, under the proposal, similarly would be applied only with respect to brokers' or dealers' quotations for equity securities or any QIDQS's or RNSA's publicly available determinations regarding equity securities.

84 See 17 CFR 240.15c2-11(d)(1), (d)(2).

85 The Commission is also proposing non-substantive, grammatical amendments to change the word “a,” which precedes the word “security” in the existing rule, to “an,” which would precede the words “equity security” in these paragraphs.

86 See 17 CFR 240.15c2-11(d)(1)(ii), (d)(2), (d)(2)(i), (d)(2)(ii).

Additionally, the Commission is proposing to amend the existing record preservation requirement in paragraph (d)(2)(ii) for any broker or dealer that relies on a publicly available determination described in paragraph (f)(7), if the publicly available determination pertains to the availability of the municipal securities exception in paragraph (f)(4). As discussed above, in Part II.B.2, the Commission is proposing to remove the municipal securities exception, as well as the reference to that exception in paragraph (f)(7). In light of these proposed amendments, the Commission is proposing a conforming amendment in paragraph (d)(2)(ii) to remove the existing reference to paragraph (f)(4) because it would no longer be appropriate to include if the exception that serves as a basis for this record preservation requirement were removed.

C. Technical Amendments

The Commission is proposing three technical, grammatical corrections to Rule 15c2-11 that would not change the meaning or operation of any of the rule's provisions. Specifically, paragraph (f)(3)(ii) of the piggyback exception currently erroneously repeats the word “in.” The proposed amendments would remove the second, redundant “in” from this provision

y in Rule 3a11-1—that were not discussed above, in Part II? Please explain.

Q8. Rule 15c2-11's definitions for the terms “quotation” and “quotation medium,” in paragraphs (e)(7) and (e)(8), respectively, currently are consistent with section 15(c)(2) of the Exchange Act, which applies to any security (other than an exempted security or commercial paper, bankers' acceptances, or commercial bills). If Rule 15c2-11 were revised to refer to only equity securities, should Rule 15c2-11's definitions for the terms quotation and quotation medium be amended to add the word “equity” preceding any mention of the word “security?” Or, is any such amendment redundant or otherwise unnecessary given the proposed revisions in paragraphs (a), (b), (c), (d), and (f) of the rule? Please explain.

Q9. Should Rule 15c2-11 be amended to include an exception in paragraph (f) for equity securities that are “crypto assets”? Should such an exception contain any conditions? Why or how are the securities that would be covered by such an exception less likely to be the subject of fraudulent or manipulative activity? Please discuss the advantages and disadvantages of such an exception.

Q10. Should the Commission adopt a specified information paragraph, for purposes of satisfying Rule 15c2-11's information gathering and review requirements, that can be more narrowly tailored (than existing paragraph (b)(5)(i) may be) to address equity securities that are crypto assets? Please explain.

Q11. In 2020, the Commission proposed a conditional exemption from Rule 15c2-11 to facilitate the formation and implementation of an “expert market” for sophisticated or professional investors in grey market securities ( i.e., securities that trade over-the-counter but for which no quoted prices are published or submitted in a quotation medium for buyers and sellers to access)

s? Please explain.

Q11. In 2020, the Commission proposed a conditional exemption from Rule 15c2-11 to facilitate the formation and implementation of an “expert market” for sophisticated or professional investors in grey market securities ( i.e., securities that trade over-the-counter but for which no quoted prices are published or submitted in a quotation medium for buyers and sellers to access). 87 Should the Commission re-propose the conditional exemption? 88 Please explain the purpose of such an expert market if the Commission were to adopt the proposal to revise Rule 15c2-11 to refer to only equity securities. Why would such an exemption to facilitate the formation of an expert market be necessary or appropriate in the public interest? Should any further safeguards be included as a condition to this exemption ( e.g., a condition that all quotations be priced, consist of both a bid and an offer, meet a minimum size requirement, etc.)? Should any other conditions be included to ensure that this market is limited to sophisticated or professional investors? Please explain.

87 See Notice of Proposed Conditional Exemptive Order Granting a Conditional Exemption From the Information Review Requirement and the Recordkeeping Requirement Under the Securities Exchange Act of 1934 for Certain Publications or Submissions of Broker-Dealer Quotations on an Expert Market, Exchange Act Release No. 90769 (Dec. 22, 2020) [86 FR 2311 (Jan. 12, 2021)] (“2020 Expert Market Notice”).

88 See 2020 Expert Market Notice.

Q12. Instead of providing an exemption for the expert market described in the 2020 Expert Market Notice, should the rule include an exception in paragraph (f) of Rule 15c2-11 to facilitate the formation of any expert market, subject to certain conditions? Please explain why this exception would be needed if the Commission were to adopt the proposal to revise Rule 15c2-11 to refer to only equity securities

significance.

A. Baseline

The baseline against which the benefits, costs, and the effects on efficiency, competition, and capital formation for the proposed amendments are measured consists of the current regulatory framework, including existing exemptions and no-action positions, and the existing OTC market, including affected securities and parties in that market. 95

95 See, e.g., Nasdaq v. SEC, 34 F.4th 1105, 1111-15 (D.C. Cir. 2022). This approach also follows SEC staff guidance on economic analysis for rulemaking. See SEC Staff, Current Guidance on Economic Analysis in SEC Rulemaking (Mar. 16, 2012), available at https://www.sec.gov/divisions/riskfin/rsfi_guidance_econ_analy_secrulemaking.pdf (“The economic consequences of proposed rules (potential costs and benefits including effects on efficiency, competition, and capital formation) should be measured against a baseline, which is the best assessment of how the world would look in the absence of the proposed action.”); id. at 7 (“The baseline includes both the economic attributes of the relevant market and the existing regulatory structure.”).

1. Regulatory Baseline

Rule 15c2-11 is intended to protect investors from certain manipulative and fraudulent trading schemes by requiring brokers and dealers to consider financial and other information about the issuer of a security before they commence making a market in that security. In particular, brokers and dealers must gather specified current and publicly available information regarding the security and its issuer and, based upon a review of such information, along with certain supplemental information, have a reasonable basis under the circumstances for believing that such information is accurate in all material respects and is from a reliable source

et in that security. In particular, brokers and dealers must gather specified current and publicly available information regarding the security and its issuer and, based upon a review of such information, along with certain supplemental information, have a reasonable basis under the circumstances for believing that such information is accurate in all material respects and is from a reliable source. 96 The production of the required information that brokers and dealers have to gather prior to publishing quotes benefits investors because not only are quotes more efficiently priced but investors also have easier access to current and publicly available information about the securities.

96 See supra Part I for detail on the information required.

Numerous industry participants have stated that they always understood Rule 15c2-11 to apply only to equity securities. 97 After industry participants shared their concerns regarding the rule's application following the 2020 amendments to Rule 15c2-11, the Commission provided exemptive relief and the staff issued a no-action letter addressing the vast majority of fixed-income securities. 98 Accordingly, consistent with industry participants' understanding of the application of Rule 15c2-11, we would expect that Rule 15c2-11 is being applied with respect to non-equity securities only to the extent that the current regulatory text has been understood by particular broker-dealers to apply to non-equity OTC securities.

97 See supra note 28 and accompanying text.

98 See supra note 31 (discussing the 144A Exemptive Release and the 2024 No-Action Letter) and accompanying text.

2. Affected Securities

As discussed in Part II.A above, under the proposal, Rule 15c2-11 would continue to apply to equity securities, as defined in Rule 3a11-1

stood by particular broker-dealers to apply to non-equity OTC securities.

97 See supra note 28 and accompanying text.

98 See supra note 31 (discussing the 144A Exemptive Release and the 2024 No-Action Letter) and accompanying text.

2. Affected Securities

As discussed in Part II.A above, under the proposal, Rule 15c2-11 would continue to apply to equity securities, as defined in Rule 3a11-1. Regarding the proposed amendments' application to crypto assets, 99 to the extent a crypto asset is an equity security, as defined in Rule 3a11-1, Rule 15c2-11 would apply to brokers and dealers initiating or resuming quotations for those equity securities in a quotation medium.

99 A “crypto asset” is any digital representation of value that is recorded on a cryptographically secured distributed ledger. The foregoing definition of “crypto asset” is identical to the definition of “Digital Asset” in section 2(6) of the Guiding and Establishing National Innovation for U.S. Stablecoins Act, Public Law No. 119-27, 139 Stat. 419 (2025).

In 2023, the Commission issued exemptive relief for fixed-income securities sold in reliance on Rule 100 The staff has also issued a no-action position for numerous categories of fixed-income securities. 101 Estimating the number of fixed-income securities to which the no-action position has relevance is difficult because the no-action position applied to fixed-income securities or issuers that met certain criteria, and which are not necessarily reflected in data reported by issuers or market intermediaries. One source of fixed-income transactions, the Trade Reporting and Compliance Engine (TRACE), contains transactions for over 53,100 bond issues from over 3,300 issuers in the first quarter of 2025. 102

100 See supra note 54.

101 See 2024 No-Action Letter.

102 Securities that are eligible to be reported to TRACE are debt securities that are United States dollar-denominated and are: (1) issued by a U.S

PRA burdens in satisfying Rule 15c2-11's requirements. See 2020 Release, 85 FR 68174 n.564. The Commission recognizes that there may be equity securities that are quoted in other quotation mediums but, at this time, does not have the empirical data to include them in the PRA burdens estimations.

104 See infra note 141.

105 Currently, FINRA is the only existing RNSA.

106 See infra Part V.D.2.

107 The Commission uses this number as a proxy for the number of brokers and dealers that comply with Rule 15c2-11's information gathering and review requirements by conducting the review itself, instead of relying on the QIDQS's publicly available determination regarding its satisfaction of Rule 15c2-11's information gathering and review requirement. See infra note 140.

108 The Commission believes that most OTC equity securities are quoted on OTC Link ATS and Global OTC, to the extent the quotation is subject to Rule 15c2-11, and that the total amount of individual brokers and dealers trading on these systems reasonably estimates the number of brokers and dealers that may be subject to Rule 15c2-11's recordkeeping requirements. See 2020 Release, 85 FR 68174 n.564. The Commission recognizes that there may be equity securities that are quoted in other quotation mediums but, at this time, does not have the data to include them in these estimates.

109 Id.

Additionally, there is one QIDQS, which makes publicly available determinations that it satisfied Rule 15c2-11's information gathering and review requirements for OTC equity securities or that the conditions of certain rule exceptions were met for affected securities. 110 In addition, there is one RNSA that makes publicly available determinations that the conditions of certain rule exceptions are met for OTC equity securities. 111

110 A broker or dealer may publish quotations in reliance on a QIDQS's or RNSA's publicly available determination that the conditions of certain Rule 15c2-11 exceptions are met. See supra Part I.

111 Id

et for affected securities. 110 In addition, there is one RNSA that makes publicly available determinations that the conditions of certain rule exceptions are met for OTC equity securities. 111

110 A broker or dealer may publish quotations in reliance on a QIDQS's or RNSA's publicly available determination that the conditions of certain Rule 15c2-11 exceptions are met. See supra Part I.

111 Id.

The proposed amendments to Rule 15c2-11, if adopted, would affect brokers and dealers that publish or submit quotations for OTC non-equity securities in a quotation medium that is subject to this rule only to the extent that those broker-dealers apply the rule more broadly than to only equity securities. In particular, certain broker-dealers that quote OTC non-equity securities that are not covered by the 144A Exemptive Release and 2024 No-Action Letter may have different understandings of the scope of Rule 15c2-11 and may currently be applying Rule 15c2-11 to non-equity securities. The Commission lacks data on the number of such broker-dealers but understands that few, if any, industry participants understood Rule 15c2-11 to apply to non-equity OTC securities. Among other limitations, it is difficult to estimate the scope of brokers' and dealers' quotations in quotation mediums for non-equity securities, partially due to the same information availability challenges in the market for non-equity securities described by market participants. 112

112 See supra note 58.

Finally, to the extent that certain broker-dealers are not currently applying Rule 15c2-11 to only equity securities, other affected parties would include issuers of OTC non-equity securities and investors in these securities (either investors already holding a position in OTC non-equity securities or those considering acquiring such a position). 113

113 The Commission does not have the necessary data to estimate the number of issuers of non-equity securities or investors currently participating in the OTC market for non-equity securities.

B

ude issuers of OTC non-equity securities and investors in these securities (either investors already holding a position in OTC non-equity securities or those considering acquiring such a position). 113

113 The Commission does not have the necessary data to estimate the number of issuers of non-equity securities or investors currently participating in the OTC market for non-equity securities.

B. Benefits and Costs

1. Affected Brokers, Dealers, QIDQSs, and RNSAs

The Commission expects that the benefits and the costs of the proposed amendments for brokers, dealers, the QIDQS, and the RNSA to be minimal. To the extent that certain brokers and dealers, as well as the QIDQS and RNSA, apply Rule 15c2-11 to non-equity OTC securities, they would benefit from reduced ongoing costs under the proposed amendments, while incurring some initial costs to adjust their practices consistent with the proposed amendments. The proposed amendments would benefit such affected brokers and dealers, including the QIDQS, by eliminating the ongoing cost of undertaking the substantive information gathering and review requirements in Rule 15c2-11(a)(1)(i) and (a)(2) before initiating or resuming any quotation for a non-equity OTC security that is neither exempt from nor qualifies for an exception from the rule in a quotation medium and the corresponding record preservation requirements. 114 In addition, such brokers and dealers, including QIDQSs, as well as RNSAs would benefit from no longer satisfying the requirements for the exceptions in Rule 15c2-11(f) and corresponding record preservation requirements. 115 Similarly, such brokers 116

114 See 17 CFR 240.15c2-11(a)(1)(i), (a)(2), (d)(1)(i)(A), (d)(1)(i)(B).

115 See 17 CFR.240.15c2-11(d)(2), (f).

116 See 17 CFR 240.15c2-11(a)(3)

Lastly, affected brokers and dealers, including QIDQSs, may continue to have economic incentives to gather and review information about non-equity OTC securities ( e.g., such as for pricing purposes), and also provide some information to investors (though not necessarily the information that was required under 15c2-11) should investors demand such information to trade in affected securities.

2. Affected Issuers

The proposed amendments could reduce incentives for issuers of non-equity OTC securities to provide information that is current and publicly available because brokers and dealers could publish quotations for any non-equity security in a quotation medium whether the issuer makes information current and publicly available or not. As a result, it is possible that to the extent issuers of non-equity securities are currently providing information to the public based on their understanding of the application of Rule 15c2-11, they may reduce the amount of information about themselves that is current and publicly available, and some of those issuers might choose to stop providing information altogether. This could decrease disclosure costs for those issuers. However, the effect may be mitigated for several reasons. First, following the adoption of the 2020 amendments to Rule 15c2-11, numerous industry participants have stated that they never understood Rule 15c2-11 to apply to non-equity securities, 117 so the amendments are not likely to impact issuer decisions concerning the provision of information. Second, the Commission has provided exemptive relief and the staff has issued a no-action letter addressing the vast majority of fixed-income securities 118 further reducing the likelihood that the proposed amendments will affect the incentives for issuers of non-equity securities to change their behavior

amendments are not likely to impact issuer decisions concerning the provision of information. Second, the Commission has provided exemptive relief and the staff has issued a no-action letter addressing the vast majority of fixed-income securities 118 further reducing the likelihood that the proposed amendments will affect the incentives for issuers of non-equity securities to change their behavior. Finally, to the extent that a lack of information about an issuer's non-equity OTC securities were to adversely impact a broker or dealer's ability to make markets in those securities or investor demand for those securities, that issuer could have incentives to continue to supply some information to brokers and dealers as well as to investors.

117 See supra note 28.

118 See supra note 31.

3. Affected Investors

Under the proposed amendments, investors in non-equity OTC securities could have less information about those securities, because affected brokers and dealers, QIDQSs, and RNSAs might no longer gather, review, and provide information on these securities and issuers could provide less information that is current and publicly available. 119 As stated above, investors in non-equity securities are largely sophisticated or qualified investors. 120 A reduction in information to investors could increase the risk that they would be subject to certain manipulative and fraudulent trading schemes involving affected securities; however, this risk is mitigated to the extent that investors in non-equity securities are sophisticated or qualified. Furthermore, the general understanding of industry participants regarding the application of Rule 15c2-11 to non-equity OTC securities means that investors in such securities may already receive less information.

119 See supra Part II.A.

120 See supra Part II.A. However, the municipal securities market, which is currently excepted from Rule 15c2-11, historically has not been dominated by sophisticated investors

eneral understanding of industry participants regarding the application of Rule 15c2-11 to non-equity OTC securities means that investors in such securities may already receive less information.

119 See supra Part II.A.

120 See supra Part II.A. However, the municipal securities market, which is currently excepted from Rule 15c2-11, historically has not been dominated by sophisticated investors. See, e.g., SIFMA, “Quarterly Report: US Fixed Income, 3Q25,” at 8 (Jan. 2026), available at https://www.sifma.org/wp-content/uploads/2025/09/SIFMA-Research-Quarterly-Fixed-Income-O-3Q25.pdf (reporting that 48.3% of municipal securities holders are individuals and 28.4% are mutual funds). See also, e.g., Simon Z. Wu and Nicholas J. Ostroy, MSRB, “A Comparison of Transaction Costs for Municipal Securities and Other Fixed-Income Securities,” at 11 (Mar. 2025), available at https://www.msrb.org/sites/default/files/2025-03/Comparison-of-Transaction-Costs.pdf (“Overall, corporate bonds had a lower proportion of odd-lot customer trades than agency securities and municipal securities, with 72% of corporate bond trades being odd-lot trades, compared to 84% for both agency securities and municipal securities. On the other hand, corporate bonds had a higher proportion of intermediate customer trades and block customer trades than agency securities and municipal securities. This suggests a higher participation rate by institutional investors for corporate bonds than for agency securities and municipal securities.”).

Further, with respect to OTC fixed-income securities, several factors likely mitigate the cost associated with the loss, if any, of current and publicly available paragraph (b) information. First, the OTC fixed-income market is generally dominated by sophisticated investors that likely do not wholly depend on a broker or dealer's review of the information specified in Rule 15c2-11

y sources of data and information as well as provide data and information to assist us in analyzing the economic consequences of the proposed amendments and each reasonable alternative. We are also interested in comments on the qualitative benefits and costs we have identified and any qualitative benefits and costs we may have overlooked, including those associated with each reasonable alternative. In addition, we are interested in comments on any other reasonable alternative.

Q16. Are there any effects on market participants, including brokers and dealers, investors, and issuers, that have not been addressed?

Q17. Are there specific types of non-equity OTC securities that should be included within the scope of Rule 15c2-11? What is the aggregate market value of these other non-equity OTC securities, and are their investors retail or institutional?

Q18. How costly is it for issuers and brokers and dealers to determine whether or not a specific security is an “equity security” under Rule 3a11-1?

V. Paperwork Reduction Act

A. Introduction

Certain provisions of Rule 15c2-11 contain “collection of information requirements” within the meaning of the Paperwork Reduction Act of 1995 (“PRA”). 122 The title for the information collection is “Publication or submission of quotations without specified information.” Responses to the collections of information are mandatory. The Office of Management and Budget (“OMB”) has assigned control number 3235-0202 to the collection of information. The Commission is submitting the collections of information as proposed to be revised to OMB for review in accordance with 44 U.S.C. 3507(d) and 5 CFR 1320.11. 123 An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the agency displays a currently valid control number. 124

122 44 U.S.C. 3501 et seq. The burdens associated with the information collection requirements are referred to as “PRA burdens.”

123 See 44 U.S.C. 3507; 5 CFR 1320.11.

124 See 5 CFR 1320.08

507(d) and 5 CFR 1320.11. 123 An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the agency displays a currently valid control number. 124

122 44 U.S.C. 3501 et seq. The burdens associated with the information collection requirements are referred to as “PRA burdens.”

123 See 44 U.S.C. 3507; 5 CFR 1320.11.

124 See 5 CFR 1320.08.

B. Rule 15c2-11

Rule 15c2-11 requires that brokers and dealers give some measure of attention to financial and other information about the issuer of a security before they commence trading in that security. 125 To that end, the rule requires, subject to exceptions, 126 brokers and dealers, before initiating (or resuming) any quotation for a security in a quotation medium, 127 to gather specified information regarding the security and its issuer and, 128 based upon a review of such information, along with certain supplemental information, 129 to have a reasonable basis under the circumstances for believing that such information is accurate and is from a reliable source. 130 Alternatively, a broker or dealer may submit a quotation in a quotation medium that is a QIDQS 131 that has made a publicly available determination that it has performed certain information gathering and review requirements, 132 if certain conditions are met. 133 Rule 15c2-11 also includes certain exceptions 134 and record preservation requirements. 135

125 See 1984 Release, 49 FR 45118.

126 See 17 CFR 240.15c2-11(f).

127 See 17 CFR 240.15c2-11(e)(8).

128 See 17 CFR 240.15c2-11(b).

129 See 17 CFR 240.15c2-11(c).

130 See 17 CFR 240.15c2-11(a).

131 See 17 CFR 240.15c2-11(e)(6).

132 See 17 CFR 240.15c2-11(a)(1)(ii).

133 See 17 CFR 240.15c2-11(a)(2).

134 See 17 CFR 240.15c2-11(f).

135 See 17 CFR 240.15c2-11(d).

C

irements. 135

125 See 1984 Release, 49 FR 45118.

126 See 17 CFR 240.15c2-11(f).

127 See 17 CFR 240.15c2-11(e)(8).

128 See 17 CFR 240.15c2-11(b).

129 See 17 CFR 240.15c2-11(c).

130 See 17 CFR 240.15c2-11(a).

131 See 17 CFR 240.15c2-11(e)(6).

132 See 17 CFR 240.15c2-11(a)(1)(ii).

133 See 17 CFR 240.15c2-11(a)(2).

134 See 17 CFR 240.15c2-11(f).

135 See 17 CFR 240.15c2-11(d).

C. Collection of Information

The proposed amendments would revise Rule 15c2-11 to replace the terms “security” and “securities” with the terms “equity security” or “equity securities,” as defined in Rule 3a11-1, 136 but would not change Rule 15c2-11's information collection requirements as they relate to broker or dealer quotations for equity securities. 137 The availability of updated and supplemented OTC equities market data in the estimates, discussed below in Part V.F, result in some changes, including increases, to the PRA burden estimates compared to the PRA Analysis in the 2020 Release 138 and PRA Supporting Statement filed with and approved by OMB in 2023. 139 However, any such changes in PRA burden estimates are the result of changes to participation and activity in the OTC equity market, the use of updated and supplemented OTC equity market data, or changes to the calculation methodology, and are not the result of the proposed amendments.

136 See supra note 34.

137 The changes to the estimated burdens based on the updated and supplemented data will be included in an upcoming extension request for OMB Control No. 3235-0202 and will be noticed for public comment in connection with that request.

138 See 2020 Release, 85 FR 68174-84 (containing the Paperwork Reduction Act Analysis of the 2020 Release).

139 See 2023 Supporting Statement for the Paperwork Reduction Act Information Collection Submission for Rule 15c2-11, OMB Control No. 3235-0202 (“2023 PRA Extension”), at 9, available at https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202303-3235-044.

D

ee 2023 PRA Extension.

2. Respondents Related to Rule 15c2-11's Exceptions and Corresponding Record Preservation Requirements

The Commission estimates that approximately 196 brokers and dealers, 143 one QIDQS, 144 and one RNSA 145 would be subject to PRA burdens associated with documenting whether the conditions of an exception in paragraph (f) are met and with preserving corresponding records.

143 As of September 30, 2025, there were 77 brokers and dealer subscribers to OTC Link ATS. As of September 30, 2025, there were 119 brokers and dealers that trade on Global OTC. The Commission believes that most OTC equity securities are quoted on OTC Link ATS and Global OTC, to the extent the quotation is subject to Rule 15c2-11, and that the total amount of individual brokers and dealers trading on these systems reasonably estimates the number of brokers and dealers that may be subject to PRA burdens in satisfying Rule 15c2-11's requirements. See 2020 Release, 85 FR 68174 n.564.

144 See supra note 141.

145 Currently, FINRA is the only existing RNSA.

3. Respondents Related to Other Record Preservation Requirements

The Commission estimates that approximately 77 brokers and dealers would be subject to PRA burdens associated with preserving records related to their initiation of a quoted market in an equity security based on a QIDQS's publicly available determination that it satisfied Rule 15c2-11's information gathering and review requirements pursuant to paragraph (a)(1)(ii). 146 The Commission also estimates that approximately 196 brokers and dealers would be subject to PRA burdens associated with preserving records related to their publication or submission of quotations pursuant to paragraph (a)(3) for equity securities in reliance on a QIDQS's or an RNSA's publicly available determination described in paragraph (f)(2)(iii)(B), (f)(3)(ii)(A), or (f)(7). 147

146 As of September 30, 2025, there were 77 broker and dealer subscribers to OTC Link ATS

be subject to PRA burdens associated with preserving records related to their publication or submission of quotations pursuant to paragraph (a)(3) for equity securities in reliance on a QIDQS's or an RNSA's publicly available determination described in paragraph (f)(2)(iii)(B), (f)(3)(ii)(A), or (f)(7). 147

146 As of September 30, 2025, there were 77 broker and dealer subscribers to OTC Link ATS. The Commission believes that this number reasonably estimates the number of broker-dealers that may rely on a QIDQS's publicly available determination pursuant to paragraph (a)(1)(ii), because OTC Link ATS is the only QIDQS making such determinations and that would be subject to PRA burdens in preserving corresponding records.

147 See supra note 143.

4. Respondents Related to a QIDQS's or RNSA's Written Policies and Procedures

Additionally, the Commission estimates that one QIDQS would be subject to PRA burdens in establishing, maintaining, and enforcing reasonably designed written policies and procedures for making publicly available determinations pursuant to paragraph (a)(3) of Rule 15c2-11.

E. Use of Information

The information collected under Rule 15c2-11(a)'s information gathering and review requirements helps protect investors by deterring fraudulent or manipulative quotations for thinly-traded equity securities whose issuers are relatively unknown and helps brokers and dealers guard against becoming unwitting participants in fraudulent or manipulative schemes. 148 The information collected under Rule 15c2-11(f)'s exceptions helps to ensure that only those equity securities that are less likely to be the subject of fraudulent or manipulative activity are being quoted pursuant to an exception.

148 See supra note 25

e to apply to quotations for equity securities should the proposed amendments be adopted.

Any broker, dealer, or QIDQS that undertakes to satisfy Rule 15c2-11's information gathering and review requirements concerning an equity security would continue to be required to gather and review applicable paragraph (b) information and supplemental information for that equity security under paragraph (c). Such broker, dealer, or QIDQS would also continue to incur PRA burdens preserving paragraph (b) and (c) information under the recordkeeping requirements of paragraph (d). Additionally, respondents who determine whether the conditions of a Rule 15c2-11 exception are met pursuant to paragraph (f) or make

The following table summarizes the PRA burdens estimated in this Part V.F, all of which are estimated to have associated recordkeeping burdens. Any changes, including increases, in the below PRA burden estimates, when compared to the 2020 or 2023 PRA analyses, 149 are the result of changes to participation and activity in the OTC equity market, the use of updated and supplemented OTC equity market data, or changes to the underlying calculation methodology, and are not a result of the proposed amendments.

149 See supra notes 138 and 139.

PRA Summary Table 1—Estimated Burdens Information collections Type of burden Number of respondents Total annual industry burden (hours/year) IC1: 17 CFR 240.15c2-11(a)(1)(i), (d)(1)(i)(A), (a)(2) and (d)(1)(i)(B) (broker or dealer and QIDQS information gathering and review requirements; corresponding record preservation requirements) Recordkeeping 13 1,558 IC2: 17 CFR 240.15c2-11(f)(2)(ii)(B), (f)(3)(i)(C), (d)(2)(i), (d)(2)(ii) (determining currentness of publicly available paragraph (b) information; corresponding record preservation requirements) Recordkeeping 198 67,310 IC3: 17 CFR 240.15c2-11(f)(2), (d)(2)(ii) (determining availability of the unsolicited quotation exception and corresponding record preservation requirements) Recordkeeping 196 1,007,683 IC4: 17 CFR 240.15c2-11(f)

eping 77 144 IC10: 17 CFR 240.15c2-11(d)(2)(ii) (record preservation requirements for brokers and dealers relying on publicly available determinations described in paragraph (a)(3)) Recordkeeping 196 323,819 IC11: 17 CFR 240.15c2-11(a)(3) (QIDQS or RNSA written policies and procedures for making publicly available determinations) Recordkeeping 1 10 Total for All Information Collections 1,771,343 1. Burden Estimates Related to Rule 15c2-11(a)(1)(i), (a)(2), (d)(1)(i)(A), and (d)(1)(i)(B)—Broker or Dealer or QIDQS Information Gathering and Review Requirements and Corresponding Record Preservation Requirements

Under the proposed amendments, any broker or dealer that publishes a quotation for an equity security in a quotation medium pursuant to paragraph (a)(1)(i), or any QIDQS that undertakes to satisfy Rule 15c2-11's information gathering and review requirements pursuant to paragraph (a)(2), would continue to be required to gather and review specified information regarding that equity security. 150 Based on information provided by FINRA in 2024, 12 non-QIDQS brokers and dealers submitted a total of 154 Form 211 filings to initiate (or resume) a quoted market in an equity security, while one QIDQS submitted 112 Form 211 filings after making publicly available determinations that it had undertaken to satisfy Rule 15c2-11's information gathering and review requirements. 151

150 See 17 CFR 240.15c2-11(a)(1)(i), (a)(2).

151 Based on data from FINRA, in 2024, Form 211 filings were submitted pursuant to FINRA Rule 6432(b) for 266 equity securities, with corresponding information reviews conducted by using the following paragraph (b) information: 3 paragraph (b)(1), 0 paragraph (b)(2), 73 paragraph (b)(3), 163 paragraph (b)(4), and 27 paragraph (b)(5)(i).

Consistent with prior estimates, 152 the Commission estimates that, for purposes of satisfying Rule 15c2-11(a)(1)(i) and (a)(2)'s information gathering and review requirements for an equity security, it would take approximately

152 See 2023 PRA Extension

empt from registration under Exchange Act section 12(g) pursuant to Rule 12g3-2(b) (an “exempt foreign private issuer”) or does not fall within any of the categories described in paragraphs (b)(1) through (b)(4) and is generally not subject to similar statute- or rule-based disclosure and reporting requirements under the Federal securities laws (a “catch-all issuer”). See 2020 Release, 85 FR 68129.

156 This preliminary estimate is consistent with the Commission's previous burden estimate of seven hours to gather, review, and preserve the applicable documents and information specified in paragraph (b)(4) or (b)(5)(i).

157 See 17 CFR 240.15c2-11(d)(1)(i)(A), (d)(1)(i)(B) (describing the relevant recordkeeping requirements).

158 ((76 Form 211 filings concerning information specified in paragraphs (b)(1), (b)(2), and (b)(3)) × 3 hours) + ((190 Form 211 filings concerning information specified in paragraphs (b)(4) and (b)(5)(i)) × 7 hours) = 1,558 hours.

159 1,558 hours/(12 brokers and dealers that submitted a Form 211 to FINRA in 2024 + one QIDQS that submitted a Form 211 to FINRA in 2024) = 119.85 hours per respondent.

2. Burden Estimates Related to Rule 15c2-11's Exceptions and Corresponding Record Preservation Requirements

The PRA burden estimates below, in this Part V.F.2, include estimates for preserving corresponding records for determining that the conditions of Rule 15c2-11(f)'s exceptions are met. 160

160 As discussed above, in Part II, the proposed amendments would not change any of the rule's requirements or conditions as they apply to quotations for equity securities. The Commission therefore does not expect that any broker, dealer, QIDQS, or RNSA would incur an initial PRA burden under the proposed amendments

raph (b) information concerning an equity security is current and publicly available would not again, during the applicable timeframe, need to determine, for purposes of satisfying the conditions of paragraph (f)(3)(i)(C), that the same paragraph (b) information is current and publicly available.

165 See 17 CFR 240.15c2-11(d)(2)(i), (d)(2)(ii) (describing the relevant recordkeeping requirements).

166 ((5,091 issuers for which information is specified in paragraph (b)(1) × 1 minute × 1 response per year) + (304 issuers for which information is specified in paragraph (b)(2) × 1 minute × 1 response per year) + (352 issuers for which information is specified in paragraph (b)(3) × 1 minute × 4 responses per year) + (9,693 issuers for which information is specified in paragraph (b)(4) × 1 minute × 1 responses per year) + 3,901 issuers for which information is specified in paragraph (b)(5)(i) × 1 minute × 1 response per year))/60 minutes per hour = 339.95 hours.

167 339.95 hours × (196 brokers and dealers + one QIDQS + one RNSA) = 67,310.10 hours.

Rule 15c2-11(f)(2), (d)(2)(ii)—Determining Availability of the Unsolicited Quotation Exception and Corresponding Record Preservation Requirements

Under the proposed amendments, the conditional exception in paragraph (f)(2) would continue to apply to brokers' or dealers' quotations that represent a customer's unsolicited order for an equity security. This exception would continue to be unavailable for unsolicited orders submitted on behalf of an insider or affiliate of the issuer of an equity security, unless the applicable paragraph (b) information were current 168 To submit an unsolicited quotation for an equity security in reliance on this exception, brokers and dealers would continue to be able to rely upon a written representation from the customer's broker that such customer is not a company insider or affiliate of the issuer if certain conditions are met

the issuer of an equity security, unless the applicable paragraph (b) information were current 168 To submit an unsolicited quotation for an equity security in reliance on this exception, brokers and dealers would continue to be able to rely upon a written representation from the customer's broker that such customer is not a company insider or affiliate of the issuer if certain conditions are met. 169 According to data from OTC Markets Group Inc., there were 11,073,440 quotations published in reliance on the unsolicited quotation exception in 2024. According to data from Global OTC, there were 49,387,514 unsolicited quotations published in 2024. 170 The Commission therefore estimates that, annually, 60,460,954 quotations would be submitted in reliance on the unsolicited quotation exception and would require brokers and dealers to gather, review, and preserve 171 documentation demonstrating that the quotation does not represent an insider's or affiliate's unsolicited order. The Commission is including all unsolicited customer quotations in its estimate and estimates that the number would remain consistent on an annual basis for the purpose of this analysis.

168 See 17 CFR 240.15c2-11(f)(2)(ii)(B).

169 See 17 CFR 240.15c2-11(f)(2)(iii)(A).

170 See supra note 143.

171 See 17 CFR 240.15c2-11(d)(2)(ii) (describing the relevant recordkeeping requirements).

Additionally, the Commission estimates that brokers and dealers would spend approximately one minute in gathering, reviewing, and preserving such documents and information. 172 The Commission estimates that, annually, 196 brokers and dealers, would spend an industry total of approximately 1,007,683 hours in determining whether the unsolicited quotation exception is available and in complying with its corresponding record preservation requirement, 173 or approximately 5,141 hours per broker or dealer

than four business days in succession without a bid or offer priced quotation. To comply with this requirement, brokers and dealers relying on the piggyback exception, and each QIDQS or RNSA that makes publicly available determinations regarding the availability of the piggyback exception, must preserve documents and information regarding this frequency of priced bid or offer quotation requirement. Consistent with prior estimates, the Commission estimates that respondents would make determinations regarding the frequency of quotation requirement once per trading day and take approximately one second to create a record regarding the frequency of a priced bid or offer quotation, pursuant to paragraph (f)(3)(i) of the rule. 175 The Commission estimates that 198 respondents 176 would each have an annual burden of approximately 1,652 hours per year, 177 for an industrywide annual burden of approximately 327,124 hours per year. 178

175 See 2023 PRA Extension. See also 2020 Release, 85 FR 68180.

176 196 brokers and dealers + 1 QIDQS + 1 RNSA= 198 respondents.

177 1/3600 (one second) × 252 (trading days per year) × 23,602 (total quoted OTC securities as of Dec. 11, 2025) = 1,652.14 hours per respondent.

178 198 respondents × 1,652.14 hours = 327,123.72 hours.

Rule 15c2-11(f)(3)(i)(B)(1), (d)(2)(i), (d)(2)(ii)—Determining Trading Suspension Status for Availability of the Piggyback Exception and Corresponding Record Preservation Requirements

Under the proposed amendments, paragraph (f)(3)(i)(B)(1) of Rule 15c2-11 would continue to limit the ability of a broker, dealer, QIDQS, or RNSA to rely on the piggyback exception with respect to a security that is the subject of a trading suspension order issued by the Commission pursuant to section 12(k) of the Exchange Act until 60 calendar days after the expiration of such order. The Commission estimates that respondents would create records only for securities that have been the subject of a trading suspension issued by the Commission pursuant to section 12(k)

ption and Corresponding Record Preservation Requirements

Under the proposed amendments, paragraph (f)(3)(i)(B)(2) of Rule 15c2-11 would continue to eliminate eligibility for the piggyback exception for quotations for securities of shell companies that are published or submitted 18 months following the publication or submission of the initial priced quotation for such issuer's security in an IDQS. Consistent with prior estimates, the Commission estimates that how often respondents would determine whether the issuer of an equity security is a shell company, as required by paragraph (f)(3)(i)(B)( 2 ) of the piggyback exception, depends on how frequently the applicable paragraph (b) information is filed (in the EDGAR system) or made current and publicly available. The Commission estimates that each respondent would continue to spend, on average, one minute per issuer in making a shell company determination and preserving applicable documentation. 183 Accordingly, the Commission estimates that each respondent would spend approximately 180 hours, annually, in determining whether an equity security's issuer is a shell company, 184 or approximately 35,555 hours across all respondents. 185

183 See 17 CFR 240.15c2-11(d)(2)(i), (d)(2)(ii) (describing the relevant recordkeeping requirements). This preliminary estimate is consistent with the Commission's previous burden estimate of one minute per determination. See 2023 PRA Extension. See also 2020 Release, 85 FR 68180.

184 ((2,503 issuers for which information is specified in paragraph (b)(1), paragraph (b)(2), paragraph (b)(3), or paragraph (b)(4) × 1 minute × 4 responses per year) + (654 issuers for which information is specified in paragraph (b)(5)(i) × 1 minute × 1 responses per year))/60 minutes = 179.57 hours.

185 179.57 hours × (196 brokers and dealers + one QIDQS + one RNSA) = 35,554.86 hours

68180.

184 ((2,503 issuers for which information is specified in paragraph (b)(1), paragraph (b)(2), paragraph (b)(3), or paragraph (b)(4) × 1 minute × 4 responses per year) + (654 issuers for which information is specified in paragraph (b)(5)(i) × 1 minute × 1 responses per year))/60 minutes = 179.57 hours.

185 179.57 hours × (196 brokers and dealers + one QIDQS + one RNSA) = 35,554.86 hours. Any change in this estimate from prior Rule 15c2-11 PRA burden estimates is due to changes in certain market metrics over time and/or changes in data collection methods, and not from the proposed amendments.

Rule 15c2-11(f)(5)(i), (d)(2)(i), (d)(2)(ii)—Determining Availability of the ADTV and Asset Test Exception and Corresponding Record Preservation Requirements—ADTV Test

Under the proposed amendments, paragraph (f)(5) of Rule 15c2-11 would continue to except securities with (i) a worldwide average daily trading volume value of at least $100,000 reported during the 60 calendar days immediately before the publication of the quotation of such security (“ADTV Test”) and (ii) the issuer of such security has at least $50 million in total assets and $10 million in shareholders' equity as reflected in the issuer's publicly available audited balance sheet issued within six months after the end of its most recent fiscal year (“Asset Test”). The Commission estimates that there are approximately 472 securities that meet the paragraph (f)(5) ADTV and Asset tests. 186 The Commission estimates that, through an automated process needing minimal direct human intervention, it would take approximately one second for a respondent to gather, review, and preserve documents and information that demonstrate that the requirements of the ADTV Test have been met, 187 and that each respondent would do this 252 times a year ( i.e., each trading day). 188 Accordingly, each respondent would spend approximately 33 hours 189 in determining whether the ADTV Test is met, or approximately 6,542 hours across all respondents

11's record preservation requirements would continue to apply to records concerning brokers' or dealers' quotations for equity securities and any QIDQS's or RNSA's publicly available determinations (made pursuant to paragraph (a)(2)(iv) or paragraph (a)(3)) regarding equity securities. The estimates discussed herein address PRA burden estimates not already discussed above, in Parts V.F.1 and V.F.2. These estimates are for PRA burdens incurred by brokers or dealers in preserving records related to their (1) initiation of a quoted market in an equity security based on a QIDQS's publicly available determination that it satisfied Rule 15c2-11's information gathering and review requirements pursuant to paragraph (a)(1)(ii) and (2) publication or submission of quotations pursuant to paragraph (a)(3) for equity securities in reliance on a QIDQS's or an RNSA's publicly available determination described in paragraph (f)(2)(iii)(B), paragraph (f)(3)(ii)(A), or paragraph (f)(7). 196

196 As discussed above, in Part II, the proposed amendments would not change any of the rule's requirements or conditions as they apply to quotations for equity securities. The Commission therefore does not expect that any broker, dealer, QIDQS, or RNSA would incur an initial PRA burden under the proposed amendments.

Rule 15c2-11(d)(1)(ii)—Record Preservation Requirements for Brokers and Dealers Relying on Publicly Available Determinations Described in Paragraph (a)(2)(iv)

Under the proposed amendments to Rule 15c2-11, any broker or dealer that initiates (or resumes) a quoted market in an equity security in reliance on a QIDQS's publicly available determination regarding its satisfaction of Rule 15c2-11's information gathering and review requirements pursuant to paragraph (a)(1)(ii) would continue to be required under paragraph (d)(1)(ii) to preserve records of the name of the QIDQS that made the publicly available determination

which a QIDQS filed a Form 211 pursuant to FINRA Rule 6432(b) in 2024 ×1 minute × 77 brokers and dealers that may rely on a QIDQS's publicly available determination)/60 minutes = 143.73 hours. Any change in this estimate from prior Rule 15c2-11 PRA burden estimates is due to changes in certain market metrics over time and/or changes in data collection methods, and not from the proposed amendments.

Rule 15c2-11(d)(2)(ii)—Record Preservation Requirements for Brokers and Dealers Relying on Publicly Available Determinations Described in Paragraph (a)(3)

Under the proposed amendments to Rule 15c2-11, any broker or dealer that relies on a QIDQS's or an RNSA's publicly available determination described in paragraph (f)(2)(iii)(B), paragraph (f)(3)(ii)(A), or paragraph (f)(7) to quote an equity security would continue to be required to preserve the name of the QIDQS or RNSA that made the determination. Any broker or dealer that relies on a publicly available determination pursuant to paragraph (f)(7) to quote an equity security would also continue to be required to preserve a record of the exception provided in paragraph (f)(1), paragraph (f)(3)(i), or paragraph (f)(5) for which the publicly available determination was made. The Commission estimates that brokers and dealers would compile, through an automated process needing minimal direct human intervention, if any, records required by paragraph (d)(2)(ii) each trading day, spending approximately one second per record. This preliminary estimate is consistent with the Commission's previous burden estimate of one second per record. 200 The 196 brokers and dealer respondents therefore would have an estimated aggregate annual information collection burden of approximately 323,819 hours, 201 or approximately 1,652 hours per respondent. 202

200 See 2023 PRA Extension. See also 2020 Release, 85 FR 68183

d per record. This preliminary estimate is consistent with the Commission's previous burden estimate of one second per record. 200 The 196 brokers and dealer respondents therefore would have an estimated aggregate annual information collection burden of approximately 323,819 hours, 201 or approximately 1,652 hours per respondent. 202

200 See 2023 PRA Extension. See also 2020 Release, 85 FR 68183.

201 (196 brokers and dealers) × (1/3600 hour (one second)) × (252 trading days per year) × (23,602 unique OTC securities with at least one published quotation) = 323,819.44 hours. Any change in this estimate from prior Rule 15c2-11 PRA burden estimates is due to changes in certain market metrics over time and/or changes in data collection methods, and not from the proposed amendments.

202 323,819.44 hours/196 brokers and dealers = 1,652.14 hours.

4. Burden Estimates Related to Rule 15c2-11(a)(3)—QIDQS or RNSA Written Policies and Procedures for Making Publicly Available Determinations

Under the proposed amendments to Rule 15c2-11, any QIDQS or RNSA that makes a publicly available determination pursuant to paragraph (a)(3) of Rule 15c2-11 would continue to be required to update its written policies and procedures to address equity securities as defined in Rule 3a11-1. 203 The Commission has preliminarily estimated, for the purposes of this release, that its previous annual burden estimate of 10 hours per respondent to review and update these written policies and procedures continues to be reasonable and takes account of any updates that would be needed to address the proposed amendments. 204

203 See supra note 82.

204 See 2023 PRA Extension. See also 2020 Release, 85 FR 68182.

Based on available data that was submitted to FINRA pursuant to Supplementary Material .02 to FINRA Rule 6432, in 2024, one QIDQS made publicly available determinations pursuant to paragraph (a)(3) of Rule 15c2-11, while the one RNSA has not made any publicly available determinations pursuant to paragraph (a)(3) of Rule 15c2-11

2.

204 See 2023 PRA Extension. See also 2020 Release, 85 FR 68182.

Based on available data that was submitted to FINRA pursuant to Supplementary Material .02 to FINRA Rule 6432, in 2024, one QIDQS made publicly available determinations pursuant to paragraph (a)(3) of Rule 15c2-11, while the one RNSA has not made any publicly available determinations pursuant to paragraph (a)(3) of Rule 15c2-11. The Commission therefore estimates that the total annual PRA burden of the information collection associated with satisfying paragraph (a)(3)'s requirements for making publicly available determinations would be 10 hours. 205

205 One QIDQS × 10 hours = 10 hours. As discussed above, in Part II, the proposed amendments would not change any of the rule's requirements or conditions as they apply to quotations for equity securities. The Commission therefore does not expect that the QIDQS would incur an initial PRA burden under the proposed amendments.

G. Collection of Information Would Be Mandatory

Under the proposed amendments to Rule 15c2-11, the information collections for the information gathering and review requirements pursuant to paragraph (a)(1) and record preservation requirements pursuant to paragraph (d) would continue to be mandatory if a broker or dealer publishes a quotation for an equity security, or if a QIDQS makes a publicly available determination pursuant to paragraph (a)(2)(iv). Additionally, the information collections involving documentation supporting the conditions of an exception would continue to be mandatory if a broker or dealer publishes any quotation for an equity security in reliance on an exception in paragraph (f) of Rule 15c2-11 or if a QIDQS or RNSA makes a publicly available determination pursuant to paragraph (a)(3).

H. Confidentiality of Responses to Collection of Information

The Commission typically would not receive confidential information as a result of these information collections

if a broker or dealer publishes any quotation for an equity security in reliance on an exception in paragraph (f) of Rule 15c2-11 or if a QIDQS or RNSA makes a publicly available determination pursuant to paragraph (a)(3).

H. Confidentiality of Responses to Collection of Information

The Commission typically would not receive confidential information as a result of these information collections. To the extent that the Commission receives, through its examination and oversight program, through an investigation, or by some other means, records or disclosures that are not publicly available, from any respondent supporting, as applicable, its satisfaction of the information gathering and review requirements, reliance on an exception or a publicly available determination, or making of a publicly available determination, such information would be kept confidential, subject to the provisions of applicable law.

I. Retention Period for Record Preservation Requirement

Under the proposed amendments to paragraph (d)(1) of Rule 15c2-11, any broker or dealer that initiates (or resumes) a quoted market in an equity security, or any QIDQS that undertakes to satisfy Rule 15c2-11's information gathering and review requirements concerning an equity security, would continue to be required to preserve the applicable documents and information, for a period of not less than three years, the first two years in an easily accessible place. Under paragraph (d)(2) of Rule 15c2-11, any broker or dealer publishing or submitting any quotation for an equity security, or any QIDQS or RNSA making a publicly available determination pursuant to proposed paragraphs (f)(2)(iii)(B), (f)(3)(ii)(A), or (f)(7) of Rule 15c2-11, would continue to be required to preserve the applicable documents and information, for a period of not less than three years, the first two years in an easily accessible place

ess the proposed amendments? If the section 3(a)(11) definition of “equity securities” were instead referenced, how would these tools or products be updated? Would having to update these tools or products increase or decrease the PRA burden estimates included in Part V.F? Would reliance on these updated tools increase or decrease the PRA burden estimates included in Part V.F? Please explain.

Q22. Are there any additional costs or burdens that respondents would incur under the proposed amendments? Please explain.

Q23. The Commission recognizes that some respondents may choose to utilize third-party vendors for purposes of complying with Rule 15c2-11's information gathering and review requirements or making certain determinations, such as whether paragraph (b) information is current and publicly available or whether certain rule exceptions are available, rather than conduct these activities themselves. The PRA burden estimates included in this release are based on respondents gathering applicable documents and information to conduct these activities, internally, without the use of third-party vendors, because the Commission lacks information from which to form a more precise estimate of the proportion of respondents who would use third-party vendors. The Commission welcomes comments on this approach, including the likelihood, burdens, and costs of using third-party vendors for these purposes.

Persons submitting comments on the collection of information requirements should direct them to the Office of Management and Budget, Attention: Desk Officer for the Securities and Exchange Commission, Office of Information and Regulatory Affairs, Washington, DC 20503, and should also send a copy of their comments to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090, with reference to File Number S7-2026-08

information requirements should direct them to the Office of Management and Budget, Attention: Desk Officer for the Securities and Exchange Commission, Office of Information and Regulatory Affairs, Washington, DC 20503, and should also send a copy of their comments to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090, with reference to File Number S7-2026-08. Requests for materials submitted to OMB by the Commission with regard to this collection of information should be in writing, with reference to File Number S7-2026-08 and be submitted to the Securities and Exchange Commission, Office of FOIA/PA Services, 100 F Street NE, Washington, DC 20549-2736. As OMB is required to make a decision concerning the collection of information between 30 and 60 days after publication, a comment to OMB is best assured of having its full effect if OMB receives it within 30 days of publication.

VI. Present Values and Annualized Values of Monetized Benefits and Costs

In addition to discussing the benefits, costs, and reasonable alternatives in the Economic Analysis in Part IV, consistent with the requirements of Executive Order 12866, and estimating burdens under the PRA in Section V, the Commission reports estimated total monetized benefits and costs for all affected entities in two ways specified in OMB Circular A-4. 207 These additional analyses include only benefits and costs that are monetized in the Economic Analysis and thus do not encompass all of the proposed amendments' benefits and costs. The two presentations are intended to address the fact that the various benefits and costs of the proposed amendments would not accrue at the same point in time; rather, benefits and costs that accrue sooner are generally more valuable than those that occur later in time. 208

207 See Exec. Order No. 12866 (Sept. 30, 1993), 58 FR 51735, 51741 (Oct

resent values of expected benefits and costs that are monetized in our economic analysis over a 10-year time horizon, starting in 2026, as well as (2) the annualized values over the same time horizon that are derived from the present values. This 10-year time horizon represents the period over which the principal benefits and costs that are monetized in the Economic Analysis are expected to accrue. 209 The present values and annualized values account for the timing of benefits and costs through discounting, which is a procedure that accounts for the time value of money. 210

209 See id. at 31 (stating that “[t]he ending point should be far enough in the future to encompass all the significant benefits and costs likely to result from the rule”). For the purposes of this analysis, we assume the effective date of the proposed amendments, as well as the start year for the analysis's 10-year time horizon, is the present year.

210 See id. at 32 (“The Rationale for Discounting”) & 45 (“Treatment of Benefits and Costs over Time”). See also OIRA, Regulatory Impact Analysis: A Primer, at 11 (Aug. 15, 2011), available at https://www.reginfo.gov/public/jsp/Utilities/circular-a-4_regulatory-impact-analysis-a-primer.pdf (“To provide an accurate assessment of benefits and costs that occur at different points in time or over different time horizons, an agency should use discounting. Agencies should provide benefit and cost estimates using both 3 percent and 7 percent annual discount rates expressed as a present value as well as annualized.”); Harvey S. Rosen & Ted Gayer, Public Finance 151 (8th ed. 2008) (defining present value as “the value today of a given amount of money to be paid or received in the future”).

Table 1 reports the discounted present values of monetized benefits and costs, combining one-time and recurring monetized benefits and costs, for all affected entities. This analysis uses annual real discount rates of 3 percent and 7 percent over a 10-year time horizon, starting in 2026

fits and Costs Over 10 Years From 2026 to 2035 [2025 Dollars] a Estimated effects 3% Real discount rate 7% Real discount rate Benefits Not monetized Not monetized. Costs Not monetized Not monetized. Notes: a This Table includes only benefits and costs that are monetized. As discussed in the Economic Analysis in Part IV, there are other benefits and costs that the Commission is not able to monetize. In sum, Tables 1 and 2 report in two alternative ways expected total benefits and costs, across all affected entities, which are monetized in our Economic Analysis in Part IV, using real discount rates of 3 percent and 7 percent over a 10-year time horizon.

VII. Regulatory Flexibility Act Certification

The Regulatory Flexibility Act of 1980 (“RFA”) requires the Commission, when issuing a rulemaking proposal, to prepare and make available for public comment an initial regulatory flexibility analysis (“IRFA”) that describes the impact of the proposed rule on small entities, 215 unless the Commission certifies that the rule, if adopted, would not have a significant economic impact on a substantial number of small entities. 216 Pursuant to 5 U.S.C. 605(b), the Commission hereby certifies that the proposed amendments to Rule 15c2-11 would not, if adopted, have a significant economic impact on a substantial number of small entities.

215 5 U.S.C. 603(a).

216 5 U.S.C. 605(b).

Small entities include broker-dealers with total capital (net worth plus subordinated liabilities) of less than $500,000 on the date in the prior fiscal year as of which its audited financial statements were prepared pursuant to Rule 17a-5(d) under the Exchange Act, 217 or, if not required to file such statements, a broker-dealer who had total capital (net worth plus subordinated liabilities) of less than $500,000 on the last day of the preceding fiscal year (or in the time it has been in business, if shorter), and is not affiliated with any person (other than a natural person) who is not a small business or small organization

ompetition, investment, or innovation.

Commenters are requested to provide empirical data and other factual support for their views to the extent possible.

IX. Other Matters

The Office of Management and Budget has determined that this action is not a significant regulatory action as defined in Executive Order 12866, as amended, and therefore it was not subject to Executive Order 12866 review.

Statutory Authority

The rule amendments contained in this release are being proposed under the authority set forth in sections 3, 10(b), 15(c), 15(h), 17(a), 23(a), and 36 of the Securities Exchange Act of 1934 [15 U.S.C. 78c, 78j(b), 78 o (c), 78o(g), 78q(a), 78w(a), and 78mm].

List of Subjects in 17 CFR Part 240

Brokers; Fraud; Reporting and recordkeeping requirements; Securities.

Text of Rule Amendments

For the reasons set forth in the preamble, the Commission is proposing to amend title 17, chapter II of the Code of Federal Regulations as follows:

PART 240—GENERAL RULES AND REGULATIONS, SECURITIES EXCHANGE ACT OF 1934

1. The authority citation for part 240 continues to read as follows:

Authority:

15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee, 77ggg, 77nnn, 77sss, 77ttt, 78c, 78c-3, 78c-5, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1, 78j-4, 78k, 78k-1, 78 l, 78m, 78n, 78n-1, 78 o, 78 o -4, 78 o -10, 78p, 78q, 78q-1, 78s, 78u-5, 78w, 78x, 78dd, 78 ll, 78mm, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, 1681w(a)(1), 6801-6809, 6825, 7201 et seq., and 8302; 7 U.S.C. 2(c)(2)(E); 12 U.S.C. 5221(e)(3); 18 U.S.C. 1350; and Pub. L. 111-203, 939A, 124 Stat. 1376 (2010); and Pub. L. 112-106, sec. 503 and 602, 126 Stat. 326 (2012), unless otherwise noted.

Section 240.15c2-11 also issued under 15 U.S.C. 78j(b), 78 o (c), 78q(a), and 78w(a).

1

m, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, 1681w(a)(1), 6801-6809, 6825, 7201 et seq., and 8302; 7 U.S.C. 2(c)(2)(E); 12 U.S.C. 5221(e)(3); 18 U.S.C. 1350; and Pub. L. 111-203, 939A, 124 Stat. 1376 (2010); and Pub. L. 112-106, sec. 503 and 602, 126 Stat. 326 (2012), unless otherwise noted.

Section 240.15c2-11 also issued under 15 U.S.C. 78j(b), 78 o (c), 78q(a), and 78w(a).

1. Amend § 240.15c2-11 by revising paragraphs (a)(1), (b)(3)(v), (b)(4), (b)(5)(i)(D), (b)(5)(i)(E), (b)(5)(i)(F), (b)(5)(i)(P), (b)(5)(ii), (c), (d)(1)(i)(A), (d)(1)(i)(B), (d)(2)(ii), (e)(5), (f)(1), (f)(3)(i)(A), (f)(3)(i)(B), (f)(3)(i)(B)( 2 ), (f)(3)(i)(C), (f)(3)(ii), (f)(4), (f)(5)(i), (f)(5)(ii), (f)(6) and (f)(7) to read as follows:

§ 240.15c2-11 Publication or submission of quotations without specified information. (a) * * *

(1) Brokers or dealers. A broker or dealer to publish any quotation for an equity security as defined in §  240.3a11-1 of this chapter or, directly or indirectly, to submit any such quotation for publication, in any quotation medium, unless:

(b)(3) * * *

(v) An annual statement referred to in section 12(g)(2)(G)(i) of the Act (in the case of an issuer of an equity security that falls within the provisions of section 12(g)(2)(G) of the Act); or

(4) A copy of the information that, since the first day of its most recently completed fiscal year, the issuer has published as required to establish the exemption from registration under section 12(g) of the Act pursuant to §  240.12g3-2(b) of this chapter, which the broker or dealer must make available upon the request of a person expressing an interest in a proposed transaction in the issuer's equity security with the broker or dealer, such as by providing the requesting person with appropriate instructions regarding how to obtain the information electronically; or

its records the following documents and information:

(d) * * *

(1)(i) * * *

(A) Any broker or dealer that publishes or submits a quotation pursuant to paragraph (a)(1) of this section for an equity security; or

(B) Any qualified interdealer quotation system that makes known to others the quotation of a broker or dealer pursuant to paragraph (a)(2) of this section for an equity security;

(d) * * *

(2) * * *

(ii) Any broker or dealer that publishes or submits a quotation pursuant to paragraph (f) of this section; Provided, however, That any broker or dealer that relies on a publicly available determination described in paragraph (f)(2)(iii)(B) or (f)(3)(ii)(A) of this section shall preserve only a record of the name of the qualified interdealer quotation system or registered national securities association that determined whether the documents and information specified in paragraph (b) of this section are current and publicly available in addition to the documents and information that demonstrate that the other requirements of the exception provided in paragraph (f)(2) or (3), respectively, are met; and that any broker or dealer that relies on a publicly available determination described in paragraph (f)(7) of this section shall preserve only a record of the exception provided in paragraph (f)(1), (f)(3)(i), or (f)(5) for which the publicly available determination is made and the name of the qualified interdealer quotation system or registered national securities association that determined that the requirements of that exception are met.

(e) * * *

(5) Publicly available shall mean available on EDGAR; on the website of a state or Federal agency, a qualified interdealer quotation system, a registered national securities association, an issuer, or a registered broker or dealer; or through an Provided, however, that publicly available shall mean where access is not restricted by user name, password, fees, or other restraints.

ollowing the initial quotation for such issuer's equity security that is the subject of a bid or offer quotation in an interdealer quotation system at a specified price;

(C) Provided further, that this paragraph (f)(3) shall apply to the publication or submission of a quotation for an equity security of an issuer only if the documents and information regarding such issuer that are specified in:

(ii) If the documents and information specified in paragraph (b) of this section (excluding paragraphs (b)(5)(i)(N) through (P)) regarding an issuer are no longer current and publicly available, timely filed, or filed within 180 calendar days, as specified in paragraph (f)(3)(i)(C) of this section, a broker or dealer may continue to publish or submit a quotation for such issuer's equity security in an interdealer quotation system during the time frame specified in paragraph (f)(3)(ii)(C) if:

(4) [Reserved]

(5) * * *

(i) An equity security with a worldwide average daily trading volume value of at least $100,000 reported during the 60 calendar days immediately before the publication of the quotation of such equity security; and

(ii) The issuer of such equity security has at least $50 million in total assets and $10 million in shareholders' equity as reflected in the issuer's publicly available audited balance sheet issued within six months after the end of its most recent fiscal year.

(6) The publication or submission of a quotation for an equity security by a broker or dealer that is named as an underwriter in a registration statement for an offering of that class of equity security referenced in paragraph (b)(1) of this section or in an offering statement for an offering of that class of equity security referenced in paragraph (b)(2) of this section; Provided, however, that this paragraph (f)(6) shall apply only to the publication or submission of a quotation for such equity security within the time frames specified in paragraph (b)(1) or (2) of this section.

quity security referenced in paragraph (b)(1) of this section or in an offering statement for an offering of that class of equity security referenced in paragraph (b)(2) of this section; Provided, however, that this paragraph (f)(6) shall apply only to the publication or submission of a quotation for such equity security within the time frames specified in paragraph (b)(1) or (2) of this section.

(7) The publication or submission of a quotation by a broker or dealer that relies on a publicly available determination by a qualified interdealer quotation system or registered national securities association that the requirements of an exception provided in paragraph (f)(1), (f)(3)(i), or (f)(5) of this section are met; Provided, however, that any qualified interdealer quotation system or registered national securities association that makes a publicly available determination that the requirements of the exception provided in paragraph (f)(3)(i) of this section are met must subsequently make a publicly available determination under paragraph (f)(3)(ii)(A) of this section, as applicable.

By the Commission.

Dated: March 16, 2026. Sherry R. Haywood, Assistant Secretary.

[FR Doc. 2026-05401 Filed 3-18-26; 8:45 am] BILLING CODE 8011-01-P