On June 11, 2026, the Securities and Exchange Commission (SEC) voted to propose the rescission of Exchange Act Rule 611 (the “Order Protection Rule” or “trade-through rule”) and Rule 610(e) (the “locked and crossed markets” prohibition) of Regulation NMS, two provisions that have shaped the structure of US equity markets since 2005.1 The proposal would eliminate both rules in their entirety, along with related defined terms in Rule 600, and make conforming amendments to other provisions.2 Comments are due 60 days following publication in the Federal Register.3
The proposal represents one of the most significant potential changes to US equity market structure in two decades. Chairman Paul Atkins, who dissented from the original adoption of Rule 611 as a commissioner in 2005,4 described the rule as having “hindered—rather than enhanced—the long-term growth of our markets”5 and characterized the proposal as intended to “simplify market structure and reduce costs for market participants while allowing competition, innovation and other market forces to shape the continuing evolution of our equity markets.” 6
Background: The Order Protection Rule and Its Origins
Rule 611 was adopted in 2005 as the centerpiece of Regulation NMS.7 It requires every “trading center”—a term that encompasses national securities exchanges, alternative trading systems, over-the-counter market makers and any broker-dealer that internally executes orders—to establish, maintain, and enforce written policies and procedures reasonably designed to prevent “trade-throughs” of protected quotations in NMS stocks.8
In practice, this means that absent an applicable exemption, if a trading center wants to execute an order at a particular price, it must first satisfy any better-priced “protected quotation” displayed on another exchange. For example, if Exchange A is displaying a sell order at $29.99, Exchange B cannot execute a sell at $30.00 without first routing to satisfy the $29.99 quote on Exchange A. The rule protects only the best bid or offer displayed on each exchange, so-called top of book quotes, and applies only to round-lot quotations disseminated through the consolidated market data system.9
The trade-through rule was intended to promote displayed liquidity by ensuring that investors who post limit orders on exchanges receive the benefit of price priority across the national market system. The SEC reasoned that protecting displayed quotes would incentivize market participants to display aggressively priced orders, improving price discovery and overall market quality.10
Rule 611 was controversial from the outset. It was adopted on a 3–2 vote, with then-Commissioners Paul Atkins and Cynthia Glassman issuing a lengthy joint dissent.11 The dissenters argued that the rule was inconsistent with Congress’s directive to protect competition among markets, would not enhance market efficiency, and would “prevent customers from obtaining the best execution, constrain competition and stifle innovation.”12 They contended that the SEC should instead focus on efforts to “improve access to quotations, enhance connectivity among markets and market participants, clarify the broker’s duty of best execution, and reduce barriers to competition.”13
Two decades later, the SEC has determined to revisit these concerns. The proposal advances several rationales for rescission:
Proposed Rescission of Rule 610(e): Locked and Crossed Markets
The proposal also seeks to rescind Rule 610(e), which requires each exchange and national securities association to adopt rules preventing their members from displaying quotations that “lock” (when a bid equals the offer) or “cross” (when a bid exceeds the offer) protected quotations on other exchanges.25