October 22, 2021

Falling Off of the Rule 15c2-11 Cliff: What Happened?

Last month, I blogged about the possibility of a large number of companies falling off of the Rule 15c2-11 cliff when amendments to the rule went into effect at the end of September. Rule 15c2-11 specifies the information that brokers must have to initiate or maintain quotations in OTC securities.

In the OTC Markets blog, we found some statistics which describe how companies were affected by the SEC rule change. OTC Markets notes that over 3,000 securities became eligible for public market maker price quotations on OTC Markets, after meeting the requirements of Rule 15c2-11 as amended. Meanwhile, 2,247 former “Pink No Information” securities shifted to the Expert Market tier, where securities may only be quoted on an unsolicited (customer order) basis. OTC Markets notes that “while this represents a large number of securities, it represented less than 5% of the total dollar volume.”

– Dave Lynn