In September 2020, the SEC amended Rule 15c2-11 under the Securities and Exchange Act, modernizing the legal framework and regulatory status of the over-the-counter (OTC) equity markets. Rule 15c2-11 serves as a regulatory gateway to the public markets, establishing the requirements for public quoting in OTC stocks (i.e. those not listed on an exchange). Over 11,000 stocks are quoted on the OTC market today, from venture-stage biotech startups to multinational corporations. The brokers that quote and trade this vast universe of securities must each comply with the provisions of Rule 15c2-11.
The SEC’s recent amendments overhaul the …
