Form 211

Definition of 'Form 211'


  1. A form that must be completed by a market maker and filed with the Financial Industry Regulatory Authority (FINRA) to initiate or resume quotations for a security on the OTC Bulletin Board, OTC Markets or any similar quotation medium. Form 211 completion indicates that the market maker has satisfied all applicable requirements of SEC Rule 15c2-11, as well as the filing and information requirements of FINRA Rule 6432.
  1. A form that must be submitted to the Internal Revenue Service by a “whistleblower” who seeks to claim a reward for providing information about tax evasion to the U.S. government.

Investopedia explains 'Form 211'


Since the OTC Bulletin Board (BB) operates as a dealer system, all securities quoted on it must be sponsored by participating market makers. A market maker registers such a security by completing Form 211 unless an exemption applies. Such exemption is granted to an issue if it meets certain criteria – for instance, if it is listed on a regional exchange and is current in its SEC filings – and requires completing a Rule 15c2-11 Regional Security Exemption Form.

As the OTCBB is only a quotation service for FINRA market makers and not a listing service, OTCBB issuers have no listing requirements to meet – unlike issuers listed on stock exchanges. While OTCBB issuers have no financial disclosure requirements, market makers must meet eligibility and regulatory requirements related to quotation display and quotation activity for such securities, which necessitates completing Form 211.

Form 211 seeks information about the issuer and the security in five parts:

  • Part 1 – Issuer and Security Information.
  • Part 2 – Issuer Information.
  • Part 3 – Supplementary Information: Required information includes the identity of persons for whom the quotation is being submitted, issuer trading suspensions within the past 12 months (if applicable) and any other material or adverse information relating to the issuer.
  • Part 4 – This section has to be completed for OTCBB quotation requests only. It seeks information on periodic financial reports filed by the issuer through the SEC’s EDGAR system, or filed with another regulatory authority.
  • Part 5 – Certification: This section has to be signed by the firm employee who can be contacted about information provided in the Form 211, as well as the firm’s registered principal responsible for the application. The signatories attest to the accuracy and reliability of the information accompanying the form.
Most market makers request additional information from the issuer, over and above the Form 211 requirements, as part of their due diligence.

The market maker must submit the completed Form 211 to the FINRA OTC Compliance Unit, along with two copies of the required issuer information, at least three business days before the security can be quoted on the OTCBB. Once the security has been cleared for quotation, Nasdaq’s Corporate Data Integrity Department notifies the market maker that it has been registered in the security and may commence quoting it.

A whistleblower can submit IRS Form 211 to claim a reward unless he or she was employed by the U.S. Department of the Treasury at the time of receiving or providing the information on the tax evasion, or is a present or former federal government employee who received the information in the course of official duties. Form 211 rewards can be substantial, up to 30 percent of the additional tax, penalty and other amounts the IRS Whistleblower Office collects.



comments powered by Disqus
Hot Definitions
  1. Yield Burning

    The illegal practice of underwriters marking up the prices on bonds for the purpose of reducing the yield on the bond. This practice, referred to as "burning the yield," is done after the bond is placed in escrow for an investor who is awaiting repayment.
  2. Marginal Analysis

    An examination of the additional benefits of an activity compared to the additional costs of that activity. Companies use marginal analysis as a decision-making tool to help them maximize their profits. Individuals unconsciously use marginal analysis to make a host of everyday decisions. Marginal analysis is also widely used in microeconomics when analyzing how a complex system is affected by marginal manipulation of its comprising variables.
  3. Treasury Inflation Protected Securities - TIPS

    A treasury security that is indexed to inflation in order to protect investors from the negative effects of inflation. TIPS are considered an extremely low-risk investment since they are backed by the U.S. government and since their par value rises with inflation, as measured by the Consumer Price Index, while their interest rate remains fixed.
  4. Gilt-Edged Switching

    The selling and repurchasing of certain high-grade stocks or bonds to capture profits. Gilt-edged switching involves gilt-edged security, which can be high-grade stock or bond issued by a financially stable company such as the Blue Chip companies or by certain governments.
  5. Master Limited Partnership - MLP

    A type of limited partnership that is publicly traded. There are two types of partners in this type of partnership: The limited partner is the person or group that provides the capital to the MLP and receives periodic income distributions from the MLP's cash flow, whereas the general partner is the party responsible for managing the MLP's affairs and receives compensation that is linked to the performance of the venture.
  6. Class Action

    An action where an individual represents a group in a court claim. The judgment from the suit is for all the members of the group (class).
Trading Center