On June 11, 2026, the Securities and Exchange Commission proposed amendments that would rescind two foundational components of Regulation NMS: Rule 611, commonly known as the trade-through prohibition, and Rule 610(e), which restricts locked and crossed quotations. The proposal also contemplates the elimination of related defined terms in Rule 600. If adopted, these changes would mark one of the most significant recalibrations of U.S. equity market structure since Regulation NMS was implemented two decades ago.
Rule 611 has long required trading centers to establish, maintain, and enforce policies reasonably designed to prevent the execution of trades at prices inferior to protected quotations displayed by other trading centers. Rule 610(e), in turn, has obligated trading centers to avoid displaying quotations that lock or cross protected quotations on other venues. Together, these provisions have served as the backbone of order protection and intermarket quotation discipline, shaping order routing logic, best execution analyses, and surveillance infrastructure across broker-dealers and exchanges.
SEC Chairman Paul S. Atkins indicated that the proposal reflects a considered review of the rules' unintended consequences after twenty years of implementation. His remarks signal a broader willingness at the Commission to reassess legacy market structure requirements, and they suggest that additional aspects of Regulation NMS may receive further scrutiny in the period ahead.
For broker-dealers, exchanges, and institutional investors, the proposed rescission warrants close attention. Firms should consider how the removal of Rules 611 and 610(e) could reshape order routing obligations, execution quality measurement, internal best execution committees, and supervisory and surveillance programs that have been calibrated around protected quotations. Technology, compliance, and policy teams may need to evaluate whether existing systems, written supervisory procedures, and venue analyses remain appropriately tailored if the prohibitions are removed.
The public comment period will remain open for 60 days following publication of the proposal in the Federal Register, providing a defined window for market participants to submit views on the proposed changes. Engagement during this period offers an opportunity to inform the Commission's evaluation and to anticipate operational and compliance implications should the amendments be adopted.
This update is provided for general informational purposes only and does not constitute legal advice. Clients should consult counsel for guidance tailored to their specific circumstances.