Notice to Members 96-53

Approval Of Amendments To The Definitions Of Bona Fide Independent Market And Bona Fide Independent Market Maker

Published Date:

Executive Summary

The Securities and Exchange Commission (SEC) has approved amendments to the definitions of "Bona Fide Independent Market" and "Bona Fide Independent Market Maker" in Rule 2720 of the NASD's Conduct Rules (Rule) (formerly Schedule E to the NASD's By-Laws). The approved amendments revise the definitions to determine eligibility for an exception from the qualified independent underwriter requirement in Rule 2720 for an equity offering of a member's own securities or securities of its parent, an affiliate, or an issuer with whom the member has a conflict of interest. The amendments are effective immediately and will apply to offerings filed after the publication of this Notice to Members.

Questions regarding this Notice should be directed to Richard J. Fortwengler, Associate Director, or Paul Mathews, Supervisor, Corporate Financing Department, both at (301) 208-2700; and Robert J. Smith, Senior Attorney, Office of General Counsel, NASD Regulation, Inc., at (202) 728-8176.