An open market purchase refers to a securities transaction which takes place in the secondary market on a registered securities exchange. IBKR may ask for documentation establishing that a security was obtained via an open market purchase transaction if a client attempts to transfer a low-priced security to their IBKR account from another broker or transfer agent. The document may consist of a brokerage statement or confirmation evidencing the purchase and its purpose is to ensure that the securities have been properly registered and can be sold without restriction.
A request for this documentation will be issued whenever a client provides notification of their intent to transfer a U.S. Microcap security. This intent is communicated via the online position transfer process in Client Portal during which the client is prompted with a question as to whether the transfer includes a U.S. Microcap stock. If the client responds "Yes" to this question, they will receive an email requesting an open market purchase document or a notice of Potentially Registered Shares.
Additional Information
- U.S. Microcap stock restrictions, see the Interactive Brokers Knowledge Base.