DAD / PAL Guides Companies toward Optimal Investor Engagement

The OTCQX DAD / PAL program offers firms an opportunity to expand relationships with existing clients and attract new business, serving as a trusted professional with expert advice on investor-friendly financial disclosure and investor demand creation in the OTC market.

A Designated Advisor for Disclosure (DAD) or Principal American Liaison (PAL) is selected by an OTCQX company to serve as a securities professional knowledgeable in both the disclosure requirements of U.S. securities laws and the most effective investor communications practices. DAD eligibility is limited to reputable securities attorneys or FINRA member investment banking firms. PAL eligibility is limited to a FINRA member investment banking firm or ADR Bank. Each prospective DAD or PAL must submit an application to OTC Markets Group to show evidence that the firm is qualified to be an OTCQX advisor.

OTCQX is a premier marketplace offered by OTC Markets Group Inc. that allows companies to better engage U.S. investors, via an innovative trading, quotation and disclosure venue for the U.S. Over-the-Counter (OTC) market. Designed to meet the particular needs of small to medium-sized U.S. public companies and non-U.S. companies listed on international stock exchanges, OTCQX aims to promote investor friendly companies that have strong operating models and that provide high-quality disclosure to the marketplace. All U.S. domiciled issuers traded on OTCQX are required to appoint and retain a DAD for ongoing guidance and advice on disclosure and other securities matters. Companies listed on a qualified stock exchange appoint a PAL.

The Primary Role of a DAD:

  • Provide professional guidance to the issuer on creating investor demand as they build long-term relationships with management
  • Assist companies to discern the information that is material to the market and should be disclosed to investors
  • Provide a professional review, not affirmation, of the company's disclosure

The Primary Role of a PAL:

  • Review and affirm an OTCQX company meets the prerequisites of the tier for which it applies
  • Serve as a liaison between the issuer and the U.S. market, by utilizing the PAL’s resources and knowledge base to help the issuer communicate effectively with the U.S. investment community
How to Become an Advisor

Each advisor must submit a DAD/PAL Application to qualify as a DAD or PAL. The application must be submitted in conjunction with an issuer's application for OTCQX. Upon admission to the OTCQX, the advisor's name will be included on OTC Markets Group's List of Designated Advisors. When an advisor is included on the List of DADs/PALs, the advisor is not required to re-submit an application to serve as a DAD or PAL for subsequent issuers. An OTCQX DAD or PAL is appointed and compensated by the OTCQX company that chooses to utilize their services.