On 25 June 2014, the Securities and Exchange Commission (“SEC”) announced that it has ordered the national securities exchanges and the Financial Industry Regulatory Authority (“FINRA”) to act jointly to develop and file with the SEC a national market system plan by 25 August 2014 to implement a targeted 12 month pilot program that will widen minimum quoting and trading increments (tick  sizes) for certain small capitalization stocks.

The pilot will last for one year and include stocks with: a market capitalization of $5 billion or less; an average daily trading volume of one million shares or less; and a share price of $2 per share or more. The pilot will consist of one control group and three test groups with 300 securities in each test group selected by stratified sampling.

Any proposed plan submitted to the SEC will be open to public comment before implementation.

The full text of the SEC order is available at: http://www.sec.gov/rules/other/2014/34-72460.pdf.