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  • 6120. Trading Halts

    (a) Authority to Initiate Halts In Trading Otherwise Than on an Exchange in NMS Stocks
    FINRA, pursuant to the procedures set forth in paragraph (b):
    (1) shall halt trading otherwise than on an exchange in any NMS stock, as defined in Rule 600(b)(47) of SEC Regulation NMS, whenever any market that has the authority to call a regulatory halt in the security imposes a trading halt, or suspends the listing, to:
    (A) permit dissemination of material news;
    (B) obtain information from the issuer relating to material news;
    (C) obtain information relating to the issuer's ability to meet listing qualification requirements; or
    (D) obtain any other information that is necessary to protect investors and the public interest.
    (2) shall halt trading otherwise than on an exchange in any NMS stock when:
    (A) extraordinary market activity in the security is occurring, such as the execution of a series of transactions for a significant dollar value at prices substantially unrelated to the current market for the security, as measured by the national best bid and offer, and
    (B) FINRA determines that such extraordinary market activity is likely to have a material effect on the market for the security; and
    (C)(i) FINRA determines that such extraordinary market activity is caused by the misuse or malfunction of an electronic quotation, communication, reporting, or execution system operated by, or linked to, FINRA; or
    (ii) After consultation with a national securities exchange trading the security, FINRA determines that such extraordinary market activity is caused by the misuse or malfunction of an electronic quotation, communication, reporting, or execution system operated by, or linked to, such other national securities exchange.
    (3) shall close the Alternative Display Facility (ADF) or any Trade Reporting Facility (TRF) to quotation and/or trade reporting activity, as applicable, whenever the ADF or such TRF is unable to transmit real-time trade reporting information to the applicable Securities Information Processor. If the ADF or any TRF closes trading pursuant to this subparagraph (3), members would not be prohibited from trading through other markets for which trading is not halted.
    Members shall promptly notify FINRA whenever they have knowledge of any matter related to an NMS stock or the issuer thereof that has not been adequately disclosed to the public or where they have knowledge of a regulatory problem relating to such security.
    (b) Commencement and Termination of a Trading Halt
    (1) In the event FINRA determines that a basis exists under this Rule 6120 to initiate a trading halt or close the ADF or any TRF, the commencement of the trading halt or closure will be effective simultaneously with appropriate notice.
    (2) Trading shall resume upon appropriate notice that a trading halt or closure is no longer in effect.
    Amended by SR-FINRA-2008-021 eff. Dec. 15, 2008.
    Amended by SR-NASD-2006-104 eff. March 5, 2007.
    Amended by SR-NASD-2006-087 eff. Aug. 1, 2006.
    Adopted by SR-NASD-2005-087 eff. Aug. 1, 2006.

    Selected Notice: 08-57.

    • 6121. Trading Halts Due to Extraordinary Market Volatility

      Pursuant to the procedures set forth in Rule 6120(b), FINRA shall halt all trading otherwise than on an exchange in any NMS stock, as defined in Rule 600(b)(47) of SEC Regulation NMS, if other major securities markets initiate market-wide trading halts in response to their rules or extraordinary market conditions or if otherwise directed by the Securities and Exchange Commission. Members must halt quoting and trading otherwise than on an exchange in any NMS stock as of the time the market-wide trading halt is publicly disseminated.

      • • • Supplementary Material: --------------

      .01 Resumption of Trading in Securities Subject to the Regulation NMS Plan to Address Extraordinary Market Volatility

      The Regulation NMS Plan to Address Extraordinary Market Volatility (Plan) sets forth the circumstances under which the Primary Listing Exchange shall declare a Trading Pause for an NMS Stock. The Plan expressly provides that no trades in an NMS Stock shall occur during a Trading Pause. The Plan also sets forth the circumstances under which trading in an NMS Stock can resume after a Trading Pause.

      (a) A member may not resume trading otherwise than on an exchange following a Trading Pause or Regulatory Halt in an NMS Stock that is subject to the Plan unless trading has commenced on the Primary Listing Exchange and either:
      (1) the member has received the Price Bands from the Processor; or
      (2) if the Processor has not yet disseminated Price Bands, but a Reference Price is available, the member calculates and applies Price Bands based on the same Reference Price that the Processor would use for calculating such Price Bands until such member receives Price Bands from the Processor, consistent with Section V(A)(1) of the Plan.
      (b) Notwithstanding paragraph (a) above, a member may resume trading otherwise than on an exchange in such NMS Stock if the Primary Listing Exchange notifies the Processor that it is unable to reopen an NMS Stock due to a systems or technology issue, or if the Primary Listing Exchange reopens trading with a quotation that has a zero bid or zero offer, or both, and:
      (1) the member has received the Price Bands from the Processor; and
      (2) trading has commenced on at least one other national securities exchange.
      (c) For purposes of this Supplementary Material .01, the following terms shall have the meanings as set forth in the Regulation NMS Plan to Address Extraordinary Market Volatility: "NMS Stock," "Price Bands," "Primary Listing Exchange," "Processor," "Regulatory Halt," "Reference Price" and "Trading Pause."

      .02 Market-wide Circuit Breakers in NMS Stocks

      (a) In the event of a Level 1, Level 2 or Level 3 Market Decline, as determined by a primary listing market and publicly disseminated, FINRA shall halt trading otherwise than on an exchange in all NMS stocks and shall not permit the resumption of trading for the time periods specified by the primary listing market, except as otherwise provided below.
      (b) For purposes of this Rule, a Market Decline means a decline in the value of the S&P 500® Index between 9:30 a.m. and 4:00 p.m. on a trading day as compared to the closing value of the S&P 500® Index for the immediately preceding trading day.
      (c) (1) If trading is halted in all NMS stocks for a Level 1 or a Level 2 Market Decline, FINRA will halt trading otherwise than on an exchange in all NMS stocks until trading has resumed on the primary listing market. If, however, the primary listing market does not reopen a security within 15 minutes following the end of the 15-minute halt period, FINRA may permit the resumption of trading otherwise than on an exchange in that security if trading in the security has commenced on at least one other national securities exchange.
      (2) If a Level 3 Market Decline occurs at any time during the trading day, FINRA shall halt trading otherwise than on an exchange in all NMS stocks until the primary listing market opens the next trading day.
      (d) The provisions of Supplementary Material .02 of this Rule shall be in effect during a pilot period that expires at the close of business on October 18, 2019.
      Amended by SR-FINRA-2019-013 eff. Apr. 11, 2019.
      Amended by SR-FINRA-2019-010 eff. Apr. 5, 2019.
      Amended by SR-FINRA-2017-031 eff. Nov. 20, 2017.
      Amended by SR-FINRA-2016-028 and SR-FINRA-2016-034 eff. Oct. 24, 2016.
      Amended by SR-FINRA-2013-016 eff. April 8, 2013.
      Amended by SR-FINRA-2011-054 and SR-FINRA-2013-011 eff. April 8, 2013.
      Amended by SR-FINRA-2013-010 eff. Feb. 1, 2013.
      Amended by SR-FINRA-2012-037 eff. July 23, 2012.
      Amended by SR-FINRA-2012-006 eff. Jan. 24, 2012.
      Amended by SR-FINRA-2011-068 eff. Nov. 21, 2011.
      Amended by SR-FINRA-2011-023 eff. Aug. 8, 2011.
      Amended by SR-FINRA-2011-038 eff. Aug. 5, 2011.
      Amended by SR-FINRA-2011-015 eff. Mar. 30, 2011.
      Amended by SR-FINRA-2010-064 eff. Dec. 7, 2010.
      Amended by SR-FINRA-2010-033 eff. Sept. 14, 2010.
      Amended by SR-FINRA-2010-025 eff. June 10, 2010.
      Adopted by SR-FINRA-2008-048 eff. Oct. 7, 2008.

      Selected Notices: 10-30, 10-43, 13-12, 16-26.