Notice2026-04413
Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Notice of Filing of Proposed Rule Change To Adopt Listing Rule IM-5101-4
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
March 6, 2026
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 91 Issue 44 (Friday, March 6, 2026)</title>
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[Federal Register Volume 91, Number 44 (Friday, March 6, 2026)]
[Notices]
[Pages 11104-11106]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-04413]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-104917; File No. SR-NASDAQ-2026-009]
Self-Regulatory Organizations; The Nasdaq Stock Market LLC;
Notice of Filing of Proposed Rule Change To Adopt Listing Rule IM-5101-
4
March 3, 2026.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on February 20, 2026, The Nasdaq Stock Market LLC (``Nasdaq'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I and II, below, which Items have been prepared by the Exchange.
The Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to adopt IM-5101-4, which will provide Nasdaq
with the authority to delist a security where the Commission has
previously suspended trading and Nasdaq determines it appropriate and
in the public interest to do so.
The text of the proposed rule change is available on the Exchange's
website at <a href="https://listingcenter.nasdaq.com/rulebook/nasdaq/rulefilings">https://listingcenter.nasdaq.com/rulebook/nasdaq/rulefilings</a>, and at the principal office of the Exchange.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
Nasdaq listing standards include continuing financial and liquidity
requirements designed to help ensure that listed companies maintain
sufficient public float, investor base, and trading interest to promote
fair and orderly markets, while also allowing companies of all sizes to
raise capital. Notwithstanding these requirements, Nasdaq has recently
observed problematic or unusual trading in certain listed companies,
apparently effectuated through recommendations made to investors by
unknown persons via social media to purchase, hold, and/or sell the
securities. The Commission has expressed concern about this activity,
and in some cases suspended trading in the securities, stating its
belief that these recommendations appear to be designed to artificially
inflate the price and volume of the securities and that the public
interest and the protection of investors require a suspension of
trading in the securities.\3\
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\3\ See, e.g., Securities Exchange Act Releases 34-104112
(September 26, 2025) (Smart Digital Group, Limited), 34-104113
(September 26, 2025) (QMMM Holding Limited), 34-104163 (October 3,
2025) (Etoiles Capital Group Co., Ltd.), 34-104164 (October 3, 2025)
(Platinum Analytics Cayman Limited), 34-104165 (October 3, 2025)
(Pitanium Limited), 34-104166 (October 8, 2025) (Empro Group Inc.),
34-104167 (October 8, 2025) (NusaTrip Incorporated), 34-104168
(October 16, 2025) (Premium Catering (Holdings) Limited), 34-104169
(October 22, 2025) (Robot Consulting Co., Ltd.), 34-104176 (November
11, 2025) (Charming Medical Limited), 34-104180 (November 14, 2025)
(MaxsMaking Inc.), 34-104317 (December 4, 2025) (Robot Consulting
Co., Ltd.), 34-10461 (January 14, 2026) (JM Group Limited), 34-
104763 (February 1, 2026) (TechCreate Group Ltd.) (collectively, the
``Commission Suspension Orders'').
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Nasdaq does not currently have authority to delist the securities
of a company based on this type of third-party misconduct \4\ but
believes that the ability for third parties to manipulate a security's
price can indicate that the security does not have sufficient
liquidity, and the issuing company does not have sufficient market
interest, for listing to be appropriate. Nasdaq therefore proposes to
adopt new IM-5101-4 to provide additional authority to exercise
discretion to delist a company from Nasdaq based on the potential for
one or more third parties to engage in misconduct impacting a company's
securities where the SEC has implemented a temporary trading
suspension.
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\4\ The SEC Suspension Orders generally appear to be based on
activities of third parties, and there are no specific allegations
in the Commission Suspension Orders against the companies, or
persons associated with the companies, as being involved in the
potentially manipulative trading activity. Nasdaq's listing
requirements, which these companies satisfied both at the time of
listing and on an ongoing basis, are based on the characteristics of
the company itself and the securities it seeks to list. Likewise,
Nasdaq Rule 5101, in conjunction with IM-5101-1, provides some
discretion to delist a company that itself has engaged in misconduct
or where an individual with a history of regulatory misconduct is
associated with the company, however it does not allow denial of a
listing based on the potential for one or more unaffiliated third
parties to engage in misconduct impacting a company's securities.
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A Commission suspension under Section 12(k) will be a pre-requisite
for applying this authority. However, even though a Commission
suspension is a pre-requisite, Nasdaq will exercise discretion on a
case-by-case basis in determining whether to delist a specific company.
In applying that discretion, Nasdaq will consider whether the listed
securities may be susceptible to manipulation based on factors related
to concerns Nasdaq and other regulators have identified with companies
that previously were the subject of problematic or unusual trading,
including considerations related to the company's advisors (including
auditors, underwriters, law firms, brokers, clearing firms, or other
professional service providers that are currently or have in the past
worked for the company). These factors, which are based on the factors
in Nasdaq Listing Rule IM-5101-3, include the following:
<bullet> where the company is located, including the availability
of legal remedies to U.S. shareholders in that jurisdiction, the
existence of blocking statutes, data privacy laws and other laws in
foreign jurisdictions that may present challenges to regulators seeking
to enforce rules against the company, the ability of parties to conduct
comprehensive due diligence in that jurisdiction, and the transparency
of regulators in the jurisdiction;
<bullet> whether a person or entity exercises substantial influence
over the company and, if so, where that person or entity is located,
including the availability of legal remedies to U.S. shareholders in
that jurisdiction, the existence of blocking statutes, data privacy
laws and other laws in foreign jurisdictions that may present
challenges to regulators seeking to enforce rules against the person or
entity, the ability of parties to conduct comprehensive due diligence
in that jurisdiction, and the transparency of regulators in the
jurisdiction;
[[Page 11105]]
<bullet> whether the public float, share distribution and trading
patterns in the company's security raise concerns about adequate
liquidity and potential concentration, including consideration of other
explanations of any observed volatility or significant price moves;
<bullet> evidence of third-party social media activity or similar
schemes designed to influence price and demand in the security;
<bullet> disclosure of material news by the company, and whether
such disclosures adequately explain the trading activity;
<bullet> whether the company has recently issued securities and the
terms of any such issuances, including the size of any discounts;
whether such shares are subject to resale; and whether the company
obtained shareholder approval for the share issuance (without regard to
whether an exemption to Nasdaq's shareholder approval for the issuance
was available);
<bullet> whether there are issues concerning the company's advisors
(including auditors, underwriters, law firms, brokers, clearing firms,
or other professional service providers), based on factors including,
but not limited to, whether the advisor has been reviewed by applicable
regulators and, if so, what were the results of those reviews;
[cir] if the company's advisor is a new entity, whether the
advisor's principals were involved with other firms with a regulatory
history;
<bullet> whether any of the company's advisors were involved in
prior transactions where the securities became subject to a pattern of
concerning or volatile trading;
<bullet> whether the company's management and Board has experience
or familiarity with U.S. public company requirements, including
regulatory and reporting requirements under Nasdaq rules and federal
securities laws;
<bullet> whether there are any FINRA, SEC or other regulatory
referrals related to the company or its advisors, or the trading of the
company's securities, which can be included in the record of the matter
and, if applicable, the results of those referrals;
<bullet> whether the company currently has, or recently has had, a
going concern audit opinion and, if so, what is the company's plan to
continue as a going concern;
<bullet> whether there are other factors that raise concerns about
the integrity of the company's board, management, significant
shareholders, or advisors; and
<bullet> any other material information, whether mitigating or
concerning, provided by the company or otherwise available in the
record of the matter.
Nasdaq Staff may use this authority even where the problematic or
unusual trading appears to be driven by third parties with no known
connection to the company, and even where Nasdaq Staff cannot determine
whether the company or any associated individual was involved, if
Nasdaq determines it is appropriate and in the public interest to do
so. When Nasdaq determines to delist a security pursuant to this
authority, Nasdaq Staff will issue a Staff Delisting Determination
under Rule 5810(c)(1). A company can seek review of such a Staff
Delisting Determination pursuant to Rule 5815.
When determining whether to apply this discretion, Nasdaq may
request additional information from a company. Such information request
can form the basis for a trading halt under Nasdaq Rule
4120(a)(5)(B).\5\
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\5\ Rule 4120(a)(5)(B) provides that Nasdaq may halt trading in
a security listed on Nasdaq when Nasdaq requests from the issuer
information relating to the issuer's ability to meet Nasdaq listing
qualification requirements, as set forth in the Listing Rule 5000
Series.
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By having authority to exercise discretion in this manner, Nasdaq
believes it can better address situations where a company satisfies
Nasdaq's listing requirements, but there are nonetheless concerns about
the trading in the company's securities, which Nasdaq believes
indicates that the security is inappropriate for continued listing.
Nasdaq may not have access to specific facts that would allow it to
determine whether a company's securities are the subject of
manipulation, including posts in private social media groups or
information about problematic or unusual trading that takes place
across other U.S. exchanges and off-exchange. However, these factors
will help Nasdaq identify companies that exhibit characteristics that
could make their securities susceptible to problematic or unusual
trading and therefore inappropriate for continued listing due to the
potential for investor harm if the company's securities were allowed to
continue to trade and be listed.
2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\6\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\7\ in particular, in that it is designed to prevent
fraudulent and manipulative acts and practices, to promote just and
equitable principles of trade, to remove impediments to and perfect the
mechanism of a free and open market and a national market system, and,
in general to protect investors and the public interest. Further, the
Exchange believes that this proposal is not designed to permit unfair
discrimination between customers, issuers, brokers, or dealers. The
Exchange also believes that the proposal furthers the objectives of
Section 6(b)(7) of the Act \8\ in that it would provide a fair
procedure for denying listing on the Exchange.
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\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(5).
\8\ 15 U.S.C. 78f(b)(7).
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The Commission has previously opined on the importance of
meaningful listing standards for the protection of investors and the
public interest.\9\ In particular, the Commission has stated:
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\9\ Securities Exchange Act Release No. 102622 (March 12, 2025),
90 FR 12608 (March 18, 2025) (approving SR-Nasdaq-2024-084 adopting
initial listing liquidity requirements for companies applying to
list or uplist on the Nasdaq Global Market or Nasdaq Capital
Market).
The development and enforcement of meaningful listing standards
for an exchange is of critical importance to financial markets and
the investing public. Among other things, such listing standards
help ensure that exchange-listed companies will have sufficient
public float, investor base, and trading interest to provide the
depth and liquidity to promote fair and orderly markets.\10\
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\10\ Id. at 12609.
The proposed rule change will supplement Nasdaq's ability to
respond quickly where the SEC has determined to implement a trading
suspension under Section 12(k) and to initiate delisting proceedings
where Nasdaq determines it is appropriate and in the public interest to
do so. This authority would enhance Nasdaq's ability to maintain fair
and orderly markets, protect investors from the risks associated with
trading in securities that raise significant concerns, and ensure that
Nasdaq's listing standards are applied in a manner consistent with
investor protection and market integrity.
Further, while Nasdaq's use of this discretion may result in the
delisting of some companies that otherwise meet the stated listing
requirements from listing, such distinction between companies is not
unfair because the affected companies will have exhibited trading
patterns and other traits that demonstrate their increased
susceptibility to manipulation. Therefore, the proposed rule change is
consistent with Section 6(b)(5) and the investor protection goals of
the Act.
Nasdaq also believes that the proposed rule change is consistent
with Section 6(b)(7) of the Act because issuers will continue to be
afforded applicable procedural protections in
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connection with any delisting determination, including notice and an
opportunity for review as provided under Nasdaq rules.
Accordingly, Nasdaq believes the proposed rule change is consistent
with the Act and the rules and regulations thereunder applicable to a
national securities exchange.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. While Nasdaq's use of the
proposed rule may result in the delisting of some companies that
otherwise meet the stated listing requirements from listing, such
distinction between companies is not unfair because the affected
companies will have exhibited trading patterns and other traits that
demonstrate their increased susceptibility to manipulation. Therefore,
the proposed rule change is necessary and appropriate to protect
investors, which is a central purpose of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the Exchange consents, the Commission shall: (a) by order approve
or disapprove such proposed rule change, or (b) institute proceedings
to determine whether the proposed rule change should be disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#4735322b226a24282a2a222933340734222469202831"><span class="__cf_email__" data-cfemail="afdddac3ca82ccc0c2c2cac1dbdcefdccacc81c8c0d9">[email protected]</span></a>. Please include
file number SR-NASDAQ-2026-009 on the subject line.
Paper Comments
<bullet> Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-NASDAQ-2026-009. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). Copies of the filing will be available for inspection and
copying at the principal office of the Exchange. Do not include
personal identifiable information in submissions; you should submit
only information that you wish to make available publicly. We may
redact in part or withhold entirely from publication submitted material
that is obscene or subject to copyright protection. All submissions
should refer to file number SR-NASDAQ-2026-009 and should be submitted
on or before March 27, 2026.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-04413 Filed 3-5-26; 8:45 am]
BILLING CODE 8011-01-P
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