Extension of Compliance Date for Disclosure of Order Execution Information

<RULE> SECURITIES AND EXCHANGE COMMISSION <CFR>17 CFR Parts 240 and 242</CFR> <DEPDOC>[Release No. 34-104147; File No. S7-29-22]</DEPDOC> <RIN>RIN 3235-AN22</RIN> <SUBJECT>Extension of Compliance Date for Disclosure of Order Execution Information</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Securities and Exchange Commission. <HD SOURCE="HED">ACTION:</HD> Final rule; extension of compliance date. <SUM> <HD SOURCE="HED">SUMMARY:</HD> The Securities and Exchange Commission (“Commission”) is extending the compliance date for the amendments to the rules requiring the disclosure of order executions in national market system (“NMS”) stocks from December 14, 2025, to August 1, 2026. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> <E T="03">Effective Date:</E> The effective date for this release is October 2, 2025. <E T="03">Compliance Date:</E> The compliance date for the amendments to Rules 600 and 605 of Regulation NMS, published on April 15, 2024, at 89 FR 26428, is extended from December 14, 2025, to August 1, 2026. </EFFDATE> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Kathleen Gross, Senior Special Counsel; Lauren Yates, Senior Special Counsel; Susie Cho, Special Counsel; or David Michehl, Special Counsel at (202) 551-5500, Division of Trading and Markets, Commission, 100 F Street NE, Washington, DC 20549. </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Discussion</HD> On March 6, 2024, the Commission adopted amendments to 17 CFR 242.600 and 17 CFR 242.605 (“Rule 605”), which, among other things, expand the scope of entities subject to Rule 605 (including larger broker-dealers, in addition to market centers), modify the categorization and content of information required to be disclosed in the detailed execution quality reports published under Rule 605 (including by modifying the scope of covered orders subject to disclosures), and require reporting entities to produce a summary report of execution quality in addition to the existing detailed disclosures regarding execution quality for covered orders in NMS stocks (“Rule 605 Amendments”). <SU>1</SU> <FTREF/> <FTNT> <SU>1</SU>   <E T="03">See</E> Securities Exchange Act Release No. 99679 (Mar. 6, 2024), 89 FR 26428 (Apr. 15, 2024) (“Adopting Release”). </FTNT> The Commission addressed the compliance date for the Rule 605 Amendments in the Adopting Release. <SU>2</SU> <FTREF/> The effective date of the Rule 605 Amendments was June 14, 2024 (“Effective Date”). In the Adopting Release, the Commission stated that the compliance date for the Rule 605 Amendments will be 18 months after the Effective Date (“Compliance Date”). <SU>3</SU> <FTREF/> Accordingly, the Compliance Date is December 14, 2025. The Commission stated that the Compliance Date was designed to allow time for participants to amend the National Market System Plan Establishing Procedures Under Rule 605 of Regulation NMS (the “Rule 605 NMS Plan”), which addresses procedures for making Rule 605 reports available in a uniform, readily accessible, and usable electronic format, and time for brokers, dealers, and market centers to comply with Rule 605 as amended. <SU>4</SU> <FTREF/> The Commission recognized that preexisting market centers and vendors will need time to update their systems and processes to ensure that data responsive to the amended Rule 605 requirements are correctly collected and formatted, and that larger broker-dealers and market centers newly subject to Rule 605 will need time to create such systems and processes. <SU>5</SU> <FTREF/> <FTNT> <SU>2</SU>   <E T="03">See</E> Adopting Release, 89 FR at 26495-97. </FTNT> <FTNT> <SU>3</SU>   <E T="03">See</E> Adopting Release, 89 FR at 26496. Paragraphs (a)(1)(ii)(M) through (Q) of Rule 605 require reporting entities to calculate price improvement statistics relative to the best available displayed price. In the Adopting Release, the Commission stated that, notwithstanding the Compliance Date, “Rule 605's price improvement statistics that are relative to the best available displayed price will not be required to be reported until six months after odd-lot order information needed to calculate the best available displayed price is made available pursuant to an effective national market system plan.” <E T="03">See</E> Adopting Release, 89 FR at 26482. The Commission is not altering this aspect of the rule and compliance with this aspect of Rule 605 is therefore required beginning November 2026. <E T="03">See also infra</E> note 20. </FTNT> <FTNT> <SU>4</SU>   <E T="03">See</E> Adopting Release, 89 FR at 26497. </FTNT> <FTNT> <SU>5</SU>   <E T="03">See</E> Adopting Release, 89 FR at 26496. </FTNT> Since the Rule 605 Amendments were adopted, Commission staff has been working with market participants to address certain technical and interpretative issues relating to the implementation of the amended rule. In connection with these efforts, market participants have requested additional time to implement the Rule 605 Amendments. For instance, in March 2025, the Financial Information Forum (“FIF”) raised concerns about whether the Compliance Date was feasible. FIF stated that it had requested that the Commission provide written clarification or guidance on numerous issues and scenarios given the “complexity of the Rule 605 reporting requirements and the complexity of order types and order handling processes in the market”  <SU>6</SU> <FTREF/> and that its members were unclear about the timing and content of a Rule 605 NMS Plan amendment. <SU>7</SU> <FTREF/> FIF also stated that “FIF members are unable to determine the timeline that would be required for reporting firms to implement the Rule 605 amendments.”  <SU>8</SU> <FTREF/> In August 2025, FIF submitted an additional comment letter asking for an extension of the Compliance Date “as soon as possible.”  <SU>9</SU> <FTREF/> In addition, FIF requested that the Commission set the compliance date for the Rule 605 amendments as the first day of a calendar month because “implementing the Rule 605 amendments mid-month would be very costly for market participants” and would be “throwaway work that would only apply for one specific month.”  <SU>10</SU> <FTREF/> <FTNT> <SU>6</SU>   <E T="03">See</E> Letter from Howard Meyerson, Managing Director, FIF, dated Mar. 17, 2025 (“FIF II”), at 1-2, <E T="03">available at https://fif.com/index.php/working-groups/category/271-comment-letters?download=3215:fif-letter-to-the-sec-relating-to-the-implementation-of-the-2024-amendments-to-rule-605&start=20&view=category</E> (citing Letter from Howard Meyerson, Managing Director, FIF, dated June 24, 2024 (“FIF I”), at 1, <E T="03">available at https://fif.com/index.php/working-groups/category/271-comment-letters?download=2954:fif-letter-to-the-sec-relating-to-the-implementation-of-the-sec-s-amendments-to-rule-605&start=60&view=category</E> ). </FTNT> <FTNT> <SU>7</SU>   <E T="03">See</E> FIF II, at 2. <E T="03">See also</E> FIF I, at 2 (stating that the Rule 605 Amendments “can only be implemented as designed” if the participants to the Rule 605 NMS Plan update the procedures for Rule 605 reporting). </FTNT> <FTNT> <SU>8</SU>  FIF II, at 2. <E T="03">See also</E> FIF I, at 25 (requesting a minimum implementation period of one year from the date that the Commission provides written guidance in response to the issues and questions set forth in their letter). </FTNT> <FTNT> <SU>9</SU>  Letter from Howard Meyerson, Managing Director, FIF, dated Aug. 20, 2025 (“FIF III”), at 2, <E T="03">available at https://fif.com/index.php/working-groups/category/271-comment-letters?download=3359:fif-letter-to-the-sec-relating-to-the-implementation-of-rule-605&view=categorye</E> Implementation of Rule 605. </FTNT> <FTNT> <SU>10</SU>  FIF III, at 3. <E T="03">See also</E> FIF I, at 25. </FTNT> After consideration of these requests, and for the reasons described below, the Commission is extending the compliance date for the Rule 605 Amendments to August 1, 2026. Beginning on August 1, 2026, market centers, brokers, and dealers subject to Rule 605 must begin to collect the information needed to prepare the execution quality reports required under the Rule 605 Amendments. <SU>11</SU> <FTREF/> This extension will provide market centers, brokers, and dealers with additional time to develop or modify the systems and processes necessary to collect and make publicly available the data required by the Rule 605 Amendments, while complying with required formats and procedures . <SU>12</SU> <FTREF/> The extension will also provide market participants with time to continue to work with Commission staff to address outstanding interpretative and compliance questions. An extension of the compliance date until August 1, 2026, strikes an appropriate balance between the goal of the Rule 605 Amendments to update and improve the disclosure of execution quality information and market participants' request for additional time for implementation of the Rule 605 Amendments. <SU>13</SU> <FTREF/> In addition, to address concerns about unnecessary costs associated with implementing the requirements mid-month, the extension will align the monthly disclosure obligation with the beginning of a month. <FTNT> <SU>11</SU>  17 CFR 242.605(a)(6) requires market centers, brokers, and dealers to make the Rule 605 detailed and summary reports publicly available within one month after the end of the month addressed in the report. Thus, reporting entities will have until the end of September 2026 to make their August 2026 reports publicly available. </FTNT> <FTNT> <SU>12</SU>  The Commission recently approved an amendment to the Rule 605 NMS Plan to reflect the Rule 605 Amendments and has issued ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 31k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━