The SEC has suggested it wants to simultaneously rule on whether to approve IEX’s exchange application and the millisecond threshold, according to people familiar with the matter who asked not to be named because the matter is private. The regulator released its proposal for the millisecond threshold on the same Friday afternoon in March that it pushed back its decision deadline for IEX’s exchange application. The SEC now has until June 18 to choose whether IEX can become an exchange.

“We believe that IEX’s application stands apart from this interpretation and we should be evaluated on our own merits,” Brad Katsuyama, the chief executive officer of IEX, said in an e-mailed statement. Kevin Callahan, a spokesman for the SEC, declined to comment.

IEX pushed this point in its own comment letter on the SEC’s millisecond threshold idea, posted to the regulator’s site on Monday. Trying to untangle its own fate from the proposal, IEX said the SEC should provide more clarity on the idea and consider any future exchange delays individually. IEX also underlined that it should enjoy all the privileges of a full-fledged exchange -- something its critics have called into question.

“Markets cannot self-correct or evolve in ways that respond to the needs of investors if regulation is used as a discriminatory barrier to prevent them from doing so,” IEX said in its letter.

‘De Minimis’

The New York Stock Exchange, Hudson River Trading LLC and Franklin Templeton Investments have all warned the SEC that dubbing delays of a millisecond or less “de minimis” would introduce problems.

“We are concerned that the SEC’s proposal would likely introduce significant unnecessary market complexities and create significant risks for investors,” William Stephenson, global head of trading at Franklin Templeton, wrote in a comment letter to the SEC as he encouraged the SEC to approve IEX’s application as soon as possible.

The proposal could also enable market manipulation, Citadel LLC and Healthy Markets said in their own comment letters. A trading firm could influence a stock’s closing price, Citadel said, by sending out an order timed precisely so that no other participant could get to it through the delay by the time markets close.

In the computer-dominated stock market, a lot happens in the space of a millisecond, Hudson River stressed, pointing to SEC data. More than 13 percent of orders to buy or sell large stocks on public exchanges were canceled within one millisecond, according to SEC data from the fourth quarter. More than 9 percent of trades in those stocks were completed in the same period of time. Those figures don’t mesh with the notion that one millisecond is a trivial threshold, Hudson River said.

Slow Humans