Selecting the right marketplace is a fundamental and critical decision for every company. In today's increasingly competitive environment, companies face significant challenges in gaining access to capital and improving visibility and ownership. A company should carefully consider its options when determining to list its securities on an exchange.

One possibility is to list on more than one exchange. The competition and visibility delivered by multiple trading venues enhances the visibility of the company's issue. In addition, multiple exchange listings offer investors greater access to liquidity and more opportunity to execute trades. Therefore, both the company and its stockholders benefit from the efficiency of having a stock listed for trading on more than one exchange.

While there are 16 US securities exchanges registered with the SEC, the NYSE and NASDAQ are the largest and most influential exchanges. There is a great rivalry between the two exchanges and they are constantly trying to woo each other's issuers to switch their listing. For example, in July 2013, Oracle moved from NASDAQ to the NYSE, while Kraft Foods and its spun-off company Mondelez International left the NYSE for NASDAQ in October 2012. There is currently much speculation regarding whether Twitter will list its shares on the NYSE or NASDAQ.

The biggest difference between the NYSE and NASDAQ is the public's perception of the exchanges. NASDAQ has traditionally attracted more technology-based companies, while the NYSE has traditionally listed the largest public companies in the world. However, NASDAQ's technical problems with Facebook's IPO, as well as other recent trading issues, may have blunted its appeal.

The board of directors of public companies must be aware of the many complex legal requirements imposed on a reporting company as a result of listing on an exchange. To assess whether it is beneficial and even feasible for a company to pursue a particular listing, some of the issues the board of directors must consider include:

Practical Law has numerous resources that help directors understand the listing requirements (initial and continued) of the primary US securities exchanges.

Once public, companies must comply with many corporate governance requirements. These requirements are primarily imposed by the national securities exchanges on which the companies are listed, rather than by federal securities laws. The NYSE and NASDAQ have both implemented extensive corporate governance standards, including standards relating to the board of directors and the committees of the board, with which a listed company must comply. While a company may already be in compliance with the NYSE requirements, if it seeks to also list its securities on NASDAQ, the company will need to make changes to its governance structure to meet NASDAQ's corporate governance requirements.

Practical Law has several resources in this area that can save time and offer a deeper understanding of corporate governance issues, including:

Practical Law has resources which present the qualitative listing requirements of NASDAQ and the NYSE in addition to corporate governance standards. Our resources identify which requirements must be met at the time of initial listing, and must continuously be met to remain listed, and, if applicable, the maximum time for compliance from the date of listing. A company that is already listed on either of these exchanges must continue to satisfy these requirements to maintain its status as a listed company on that exchange.

While NASDAQ has three listing tiers for public companies, with each having different quantitative standards and requirements for listing, the qualitative standards and requirements for initial listing and for maintaining the listing are the same for all tiers.

Our resources also identify many of the initial and periodic reporting forms that must be filed by a listed company when complying with the applicable stock exchange's corporate governance rules.

Practical Law's resources on this issue include:

Practical Law has resources which identify the quantitative listing requirements of the NYSE and NASDAQ for listed companies. A company must meet minimum requirements of the specific exchange. The company can remain listed on the market if it continues to satisfy the market's continued listing requirements. The exchanges will consider suspension and delisting of a US company's securities if the company falls below the criteria set out in the continued listing requirements charts. Our charts enable a company to assess whether it is in a position to make an application to list on a second stock exchange:

The company can remain listed on the market if it continues to satisfy the market's continued listing requirements. The exchanges will consider suspension and delisting of a US company's securities if the company falls below the continued listing criteria set out in the following charts:

Our Practice Note, Selecting a US Securities Exchange reviews the various US securities exchanges, in addition to the NYSE and NASDAQ, available to a company seeking to list its debt or equity securities. This Note identifies the listing and annual fees of those exchanges. One key reason that some companies have identified as the rationale for switching from the NYSE to NASDAQ is that NASDAQ has lower fees.

Any company currently listed on a national securities exchange that wants to dually list on NASDAQ must meet all of the initial qualitative and quantitative criteria for listing. NASDAQ does not charge entry or application fees for the securities of a company that is dually listed on the NYSE and NASDAQ. Companies that dually list their securities on the NYSE and NASDAQ must pay an annual fee of $15,000, which is assessed on the first anniversary of the listing on NASDAQ. No annual fees are payable during the first year of the dual listing. Companies that dually list their securities on the NYSE and NASDAQ are also not subject to the fees for listing of additional shares. However, companies that dually list on other securities exchanges are subject to additional annual fees and listing fees.