SEC Approves Nasdaq’s Retail Liquidity Improvement Program

The SEC recently approved a proposal by The Nasdaq Stock Market LLC ("Nasdaq") to adopt its proposed Retail Price Improvement Program (the "Nasdaq Program") on a one-year pilot basis. The Nasdaq Program is similar to the NYSE's previously approved Retail Liquidity Program and is also similar to the program of the BATS Y-Exchange. In connection with the approval of the Nasdaq Program, the SEC also granted exemptive relief from Rule 612 of Regulation NMS, which prohibits a national securities exchange from accepting or ranking orders priced greater than $1,00 per share in an increment smaller than $.001. In addition, Nasdaq obtained no-action relief from the SEC's Division of Trading and Markets from the provisions of Rule 602 of Regulation NMS (the "Quote Rule") for failing to collect, process and make available the best bid, best offer, and quotation sizes communicated by members of the Exchange.

View letter in full here (links externally to SEC website).