U.S. Securities and Exchange Commission convenes second roundtable to reassess Regulation NMS Rule 611 Trade-Through Rule

The U.S. Securities and Exchange Commission’s Division of Trading and Markets held its second roundtable on the trade-through prohibitions in Regulation NMS, focusing on whether to rescind or modify Rule 611, commonly known as the Trade-Through Rule, and how any change would interact with other elements of U.S. equity market structure. The roundtable followed a July request for public comment and a September discussion where many participants raised concerns with the status quo and supported reexamining Rule 611 for NMS stocks. The agenda was structured around Rule 611’s linkages to other requirements, including whether Rule 610’s fair-access, access-fee, and locking or crossing quotation provisions remain necessary if trade-through protections change; what amendments to Rule 600 definitions might be required and the implications for the national best bid and offer and consolidated market data oversight, including incentives created by market data revenue allocation; and whether best execution requirements and related guidance, including FINRA’s best execution framework, should be enhanced if the Trade-Through Rule and associated rules are altered. The Division positioned the discussion as input to the Commission’s next steps, with an emphasis on identifying dependencies so that any rescission or modification to Rule 611 improves, rather than disrupts, market structure.