In a move that could reshape the way U.S. securities markets function, the Securities and Exchange Commission (SEC) is revisiting one of its most debated rules: the trade-through prohibitions, which prevent executing trades at prices worse than the best available quotes on other venues.
On September 18, 2025, the Securities and Exchange Commission will host a public roundtable in Washington, D.C. to reexamine these rules—how they’re working, where they fall short, and whether they still make sense in their current form.
The SEC roundtable will include participants from across the industry—exchanges, broker-dealers, asset managers, trading firms, academics, and investor advocates. Speakers will include representatives from BlackRock, Citadel, Nasdaq, Cornell University, Bank of America, Themis Trading, and the NYSE, among others.
The roundtable will take place from 9:15 a.m. to 4:15 p.m. ET at the SEC’s D.C. headquarters. The event is open to the public, will be webcast live, and will be available for replay at www.sec.gov.
What’s Prompting the Reexamination?
The rule hasn’t changed meaningfully since it was implemented, but the market around it has. Algorithmic trading now dominates order flow. Broker-dealers face overlapping obligations under best execution, access rules, and order protection regulations. At the same time, off-exchange trading has grown significantly, and new exchanges have entered the market with novel models.
Over the past two decades, these rules have shaped how orders are routed across U.S. equity markets. By requiring orders to be executed at the best publicly quoted prices, trade-through prohibitions were designed to protect investors from receiving worse prices when better ones are available elsewhere. However, with the rise of algorithmic trading, fragmentation across trading venues, and evolving best execution standards, critics argue that the rule may now introduce unnecessary complexity and distort market behavior.
Trade-through prohibitions are core to Regulation NMS, a key regulatory framework governing U.S. equity markets, implemented in 2005. The Rule 611 of Regulation NMS prohibit executing a trade at a price worse than a protected quotation displayed on another venue. This applies to “top-of-book” quotes—the best available bid and offer—on exchanges that meet certain regulatory criteria.
Advocates of Rule 611 highlight its importance in protecting investors, while critics argue that it creates inefficiencies in the market.
For instance, in “Order Protection Rule Tug‑of‑War, Kara Stein emphasized that Rule 611 has “served as a back‑stop protection for displayed limit orders particularly from retail investors.” She stated that retail brokerages rely on it to ensure individual investors get the best price available across all venues.
Meanwhile, Chairman Paul S. Atkins has voiced concern that Regulation NMS and Rule 611 “have not served investors or broker‑dealers well, given the market distortion and resulting gamesmanship by those that seek to take advantage of the Reg NMS structure.”
One of the critiques comes from James J. Angel, Associate Professor Academic Director, FINRA Certified Regulatory and Compliance Professional (CRCP (r)) Program at Georgetown University, who will be among the panelists.
Angel told Traders Magazine that the “trade-through rule is useless and only adds needless complexity (and cost) to the market”.
“Brokers already have a duty of best execution and the tools to execute with. Exchanges will likely continue to route orders out as a customer service. We should scrap the trade-through rule as it is no longer necessary,” he argued.
“We should also scrap the round lot, which is an archaic artifact of the olden days. The BBO should be based on a fixed dollar amount, such as $5,000,” he said.
According to Angel, execution quality should be based on the Effective Best Bid or Offer (EBBO), which would be based on the displayed depth across the markets for the actual size of the order.
“Thus, if you want to trade 15 shares of AAPL, your execution quality would based on the displayed size for 15 shares, and if you want to trade 1,500 shares it would be based on the displayed size for 1,500 shares,” he said.
With differing perspectives on the rule’s effectiveness and impact, the roundtable will be an important opportunity to assess whether Rule 611 remains relevant or requires modification. The discussions and findings will likely influence how the SEC approaches investor protection and market efficiency moving forward.
