FAQ SHELL COMPANIES Rule 15c2-11 (The “Rule”) restricts the ability of broker-dealers to quote securities of shell companies. Effective September 28, 2021, broker-dealers may only quote a security within 18 months following the initial priced quotation, and only if the company makes current information available to investors pursuant to the Rule. The Rule also provides an 18-month transition period for any company that was identified as a shell on the effective date.
What happens to the security of a shell company after 18 months?
Broker-dealers will no longer be able to publish proprietary quotes. The security may, however, be the subject of unsolicited customer quotations. A notification will appear on otcmarkets.com advising investors that only unsolicited quotes are permitted in this stock. Any company that continues to make information available pursuant to Rule 15c2-11 will remain on the Pink Market. Companies that cease to make information available pursuant to the Rule will be moved to the Expert Market. Any company that was a shell on September 28, 2021 and is still a shell will become ineligible for broker-dealer proprietary quotes on March 28, 2023.
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