OTC Markets Group Listing Requirements


The OTC Markets Group, formerly known as the National Quotation Bureau (NQB), is an organization that facilitates the trade of Over The Counter (OTC) stocks and other securities. An Over The Counter stock is a financial security that does not trade on a formal stock exchange. Rather, these securities are traded through a dealer network such as OTC Market Group which include electronic quoting and lower listing requirements than a formal exchange. OTC securities are highly regulated securities by FINRA and the SEC.

The OTC Markets Group was formally established in its present form in 2010, and provides information on over 10,000 OTC securities. Presently, a network of over 100 established broker-dealers (institutions that act as a financial securities broker and/or dealers) trade on the OTC Markets system.

The OTC Markets Group platform is segregated into 3 distinct market tiers: the OTCQX, the OTCQB, and the Pink. Each of these different tiers is separated based on perceived risk levels, which depend on the quality and regularity of a listed company's reporting information and disclosures.

OTCQX

The OTCQX, branded as the 'OTCQX, The Best Market,' has the most stringent listing standards of the three OTC Markets. The OTCQX listing requirements necessitates that a company meets the following:

  • Company needs to be SEC reporting, Reg A reporting, Bank reporting, or Alternative reporting
  • Meet one of the following financial standards and requirements as found in the below tables.
  • Compliant with corporate governance best practices
  • Timely disclose of material news and ensure you have a Verified OTC company profile at all times.
  • Must have a third-party sponsor introduction

The key benefits of getting onto the OTCQX include efficiency, cost-effective solution to NASDAQ and NYSE, reputation of high financial standards and compliance, visibility to large network of data distrbibutors and media partners to provide data to broker-dealers and investors, and better trading experience through broker or financial advisor with real-time quotes and transparent pricing.

Noteable OTCQX companies include AcuityAds Hldgs Inc. (OTCQX: ACUIF), Nouveau Monde Graphite Inc. (OTCQX: NMGRF), and CV Sciences, Inc. OTCQB. The OTCQX has different eligibility requirements depending on whether a firm is international, U.S. based, or a bank.

OTCQX U.S. Standard Requirements

Initial

Ongoing

Penny Stock Rule

Meet one of the following exemptions detailed below:

Net Tangible Assets:
$5mm: Less Than 3 Years Operations
$2mm: 3+ Years Operations

OR

Revenue:
$6 million average for last 3 years

OR

Bid:
$5; and
One of the below:
Net Income: $500,000
Net Tangible Assets: $1mm
Revenues: $2mm
Total Assets: $5mm

Bid Price

$0.25

$0.10

Market Cap

$10mm

$5mm

Price Quotes by Market Makers on OTC Link ATS

1

2 (within 90 days)

Shareholders

50 beneficial shareholders each owning at least 100 shares

50 beneficial shareholders each owning at least 100 shares


OTCQX Premier Requirements

Initial

Ongoing

Penny Stock Rule

Meet one of the following exemptions detailed below:

Net Tangible Assets:
$2mm

OR

Revenue:
$6 million average for last 3 years

Bid Price

$4.00

$1.00

Stockholders Equity

$4mm

$4mm

Price Quotes by Market Makers on OTC Link

1

4 (within 90 days)

Public Float 500,000 shares 500,000 shares

Shareholders

100 beneficial shareholders each owning at least 100 shares

100 beneficial shareholders each owning at least 100 shares

Operating history

3 years

 

Must meet one of the following standards:    
Market Value Standard:    

Market Value of Public Float

$15mm $15mm

Market Capitalization

$50mm $35mm

OR

   
Net Income Standard:    

Market Value of Public Float

$1mm $1mm

Net Income

$750,000 $500,000

Market Capitalization

$10mm $5mm

OTCQX U.S. Banks Standard Requirements

Initial

Ongoing

Penny Stock Rule

Meet one of the following exemptions detailed below:

Net Tangible Assets:
$5mm: Less Than 3 Years Operations
$2mm: 3+ Years Operations

OR

Revenue:
$6 million average for last 3 years

OR

Bid:
$5; and
One of the below:
Net Income: $500,000
Net Tangible Assets: $1mm
Revenues: $2mm
Total Assets: $5mm

Bid Price

$1.00

$1.00

Total Assets $100mm $100mm

Market Cap

$10mm

$5mm

Price Quotes by Market Makers on OTC Link

1

2 (within 90 days)

Shareholders

50 beneficial shareholders each owning at least 100 shares

50 beneficial shareholders each owning at least 100 shares


OTCQX Banks Premier Requirements

Initial

Ongoing

Penny Stock Rule

Meet one of the following exemptions detailed below:

Net Tangible Assets:
$2mm

OR

Revenue:
$6 million average for last 3 years

Bid Price

$4.00

$1.00

Total Assets

$100mm

$100mm

Stockholders Equity

$4mm

$4mm

Price Quotes by Market Makers on OTC Link

1

4 (within 90 days)

Shareholders

100 beneficial shareholders each owning at least 100 shares

100 beneficial shareholders each owning at least 100 shares

Operating history

3 years

 

Must meet one of the following standards:    
Market Value Standard:    

Market Value of Public Float

$15mm $15mm

Market Capitalization

$50mm $35mm

OR

   
Net Income Standard:    
Market Value of Public Float $1mm $1mm
Net Income $750,000 $500,000

Market Capitalization

$10mm $5mm

Companies who wish to be listed on the OTCQX must also have a third-party sponsor from a pre-approved list.

If you meet these standards and would like an OTCQX Sponsor referral, please contact us.

OTCQB Requirements

OTCQB offers early stage to fully reporting companies the benefits of being a publicly traded company. Noteable OTCQB companies including Fannie Mae (OTCQB: FNMA), Freddie Mac (OTCQB: FMCC), and CV Sciences, Inc. OTCQB

Eligibility Requirements:

  • Audited annual company financials by a PCAOB auditor according to U.S. GAAP
  • At least 50 beneficial shareholders with at least 100 shares each
  • Non-shell companies only
  • Meet Corporate Governance standards including having two Independent Directors and an Audit Committee
  • Current in public reporting requirements with SEC, ARS or banking regulator
  • Be listed on a Qualified Foreign Exchange or be a U.S. reporting company (SEC, ARS, or U.S. Bank)
  • Provide timely disclosure of material news.
  • Not be in bankruptcy
  • Meet minimum bid price test of $0.01
  • Free trading shares (Public Float) of at least 10% of total outstanding shares
  • Have an SEC registered transfer agent, like Colonial Stock, that participates in the Transfer Agent Verified Shares Program.

Post-qualification Requirements:

  • Maintain a verified OTC profile
  • Annual certification confirming company profile data
  • Non-shell companies only

If you meet the standards and requirements above, we can help you with your OTCQB listing. Please contact us.

OTC Pink

Formerly known as 'The Pink Sheets' the OTC Market Group's 'Pink' is the least regulated of the three market tiers. Branded as 'Pink, the requirements for getting listed on the Pink are as follows:

  • File a Form 15c2-11 to FINRA
  • Current SEC reporting company or current in your reporting if you are a bank, or listed on a foreign exchange. Or provide disclosure to investors directly www.otcmarkets.com via the Alternate Reporting Standard. *Currently to do a 15c2-11, you must be SEC reporting through a Form S-1 or 1-A.
  • Company profile has been verified through OTCIQ
  • Attorney letter if company is not audited
  • Non-shell companies only - good operating financials only

Companies that trade on the Pink include penny stocks, shells, distressed companies, delinquent companies, and companies that have limited their disclosure.

If you meet the standards and requirements above, we can help you with your OTC Pink listing. Please contact us.

Listing Fees

The application and annual fees for each of the OTC tiers are listed below:

Application Fees

OTCQX

OTCQB

OTC Pink

Application Fee

$5,000

$2,500

$1,000

Annual Fee

$20,000

$10,000

$5,000

How to Apply

For a complete online walk-through of the application process, please visit the OTC Market Group’s Get Traded Page.

OTC Transfer Agent for your OTC Listing

As a full-service transfer agency with over 30 years of industry experience, Colonial Stock Transfer can assist your firm with getting listed on the OTC Market Group's trading platform. To speak with a professional today or learn more about Colonial Stock Transfer, please contact us.