Minimum Form 211 or listing processing time 3 days
Registering to Make Markets in OTCBB Securities
The OTCBB operates as a dealer system. As a result, all securities being quoted on the OTCBB must be sponsored by a participating Market Maker that registers the security by completing a Form 211 unless an exemption applies. The Market Maker must submit a Form 211 to the NASD OTC Compliance Unit along with two copies of the required issuer information no less than three business days prior to publication of a quote on the OTC Bulletin Board. Once cleared, Nasdaq Market Data Integrity will notify the Market Maker that it has been registered in the security and may enter a quote.
Ineligible Securities
Every OTC security not currently quoted on the OTC Bulletin Board is considered "ineligible" until a Market Maker submits a Form 211 or a 15c2-11 Exemption Form. After clearance, the security is granted "eligible" status.
Eligible Securities
If a security has eligible status, it means one or more Market Makers has received clearance to quote the issue on the OTC Bulletin Board within the last 30 days. Any other participating Market Maker that wishes to quote the issue must also submit a completed Form 211. During the "eligible" period, a frequency-of-quotation test is administered. The test is described below. Until the test is satisfied, all Market Makers must continue to submit a completed Form 211.
Active Securities
An OTCBB-eligible security that meets the frequency-of-quotation requirement for the so-called "piggyback" exception is identified in the service as "active." The frequency-of-quotation test or "piggyback" exception is based on whether a broker/dealer has itself published quotations in the security in the applicable interdealer quotation system on at least 12 business days during the preceding 30 calendar days, with not more than four consecutive business days without quotations. Once this criteria has been satisfied, authorized participants may register on-line in a security. As long as the security remains in an "active" state, any participant may quote the security without a Form 211 submission.
Quotation Regulations
The OTC Bulletin Board is monitored by an on-line market surveillance system to help ensure compliance with the existing rules of the SEC and the National Association of Securities Dealers, Inc. (NASD®). Unless there is an exemption, participating Market Makers must comply with the requirements of SEC Rule 15c2-11 on a security-by-security basis to be eligible to quote on the OTCBB.
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