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Canadian Securities Regulatory Monitor News and Insight

Category Archives: Marketplaces

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TSX Adopts New Disclosure Requirements for Websites and Security-based Compensation Arrangements

Posted in Continuous and Timely Disclosure, Industry News, Marketplaces

On October 19, 2017, the Toronto Stock Exchange (“TSX”) announced amendments to the TSX Company Manual which introduce new website and security-based compensation arrangement disclosure requirements for most TSX-listed issuers.

The website disclosure amendments are intended to improve the accessibility of information to investors by centralizing the location of certain publicly-available documents and will be effective as of April 1, 2018.

The amendments to the security-based compensation arrangement disclosure requirements were introduced to enhance and clarify the disclosure of security-based compensation arrangements and better align the TSX disclosure requirements with the executive compensation disclosure requirements under Canadian securities … Continue Reading

IIROC Announces Dealer Sweep on Compensation-Related Conflicts

Posted in Broker-Dealers, Compliance and Supervision, CSA, IIROC, Industry News, Marketplaces, Registrants, Uncategorized

On April 6, IIROC published Notice 16-0068 – Managing Conflicts in the Best Interest of the Client (the 2016 IIROC Notice). IIROC intends to strengthen compliance by Dealer Members (DMs) with IIROC’s conflicts of interest rules, with a particular focus on the management of compensation-related conflicts.

Specifically, IIROC announced that it will take the following actions:

  1. Immediately enhance its compliance test procedures to more closely examine compensation grids, supervisory oversight of advisors recommending products with high commissions, and the monitoring of advisors approaching compensation thresholds;
  2. By June 2016, conduct a comprehensive survey to gather more detailed information
Continue Reading

CSA Proposals Require Enhanced Corporate Debt Trade Reporting and Transparency by 2017

Posted in Broker-Dealers, Continuous and Timely Disclosure, CSA, Exempt Market Dealers, IIROC, Industry News, Marketplaces, OSC, Proposals, Requests for Comment

Last week, the Canadian Securities Administrators (CSA) published for comment Proposals that would require trade information for all corporate debt securities executed by dealers to be made publicly available, subject to delayed dissemination and volume caps, by the end of 2017. The CSA Proposals aim to enhance the regulation and transparency of the Canadian fixed income market, partly in response to certain limitations highlighted in a Report on “The Canadian Fixed Income Market 2014” published earlier this year by the Ontario Securities Commission which suggested that retail investors in corporate fixed income securities have less access to … Continue Reading

On Market Manipulation – the case of Thalbinder Singh Poonian et al., 2014 BCSECCOM 318

Posted in AMF, Compliance and Supervision, Conformité et supervision, Jurisprudence, Litigation, Marketplaces

In the fall of 2014, a British Columbia Securities Commission Panel considered whether five B.C. residents (the Respondents) had engaged in market manipulation of the shares of OSE Corp. (OSE), an Ontario company listed on the TSX Venture Exchange.

In Thalbinder Singh Poonian et al., 2014 BCSECCOM 318, the Panel found that the Respondents and certain relatives, friends and associates (Secondary Participants) acquired a dominant share position of OSE and manipulated OSE’s share prices by trading through brokerage and nominee accounts. They also sold shares to unsuspecting clients of the Phoenix Group and its affiliates, where Phoenix and … Continue Reading

IIROC Survey Shows Diverse “Best Execution” Practices

Posted in Broker-Dealers, Compliance and Supervision, IIROC, Industry News, Marketplaces

Recently, the Investment Industry Regulatory Organization of Canada (IIROC) released the results of a best execution survey it conducted of all its dealer members that execute secondary market trades in listed securities. There is great variability in the best execution practices followed by participants. In this post we comment on some of the survey results.

Compliance and Supervision Practices

Compliance Procedures

Nearly three quarters of respondents have procedures specifically in place to supervise compliance with best execution. Only two thirds of the participants that are members of some marketplaces and always use an executing participant to enter orders … Continue Reading

IIROC Issues Final Guidance on Stop Loss Orders

Posted in IIROC, Marketplaces

IIROC issued final guidance late last week on the use and management of stop loss orders. The guidance comes in the wake of certain anomalous trades last month which prompted IIROC to take regulatory action when automatic triggering of stop loss orders apparently resulted in pricing distortions of Inter Pipeline Fund stock.

A stop loss order is a standing order to sell a security when the price of that security reaches a certain minimum level. Stop loss orders are a method of risk management and are frequently handled by way of automated technology solutions.

IIROC regulated dealers have “best execution” … Continue Reading

New Rules Proposed for Direct Electronic Linkages to Exchanges and Other Marketplaces

Posted in Broker-Dealers, CSA, Exempt Market Dealers, Marketplaces, Portfolio Managers, Proposals

Under Canadian securities law, registered dealers are intended to intermediate orders between customers and marketplaces. Sophisticated marketplace participants maintain a variety of relationships with brokers, some of whom are expected to provide order-routing services rather than advice. These sophisticated participants generate large volumes of orders to buy and sell securities and are concerned with limiting costs and delays in conveying orders to organized marketplaces. Accordingly, accessing marketplaces by direct electronic access (DEA) allows sophisticated marketplace participants, such as institutional traders, to effect their complex trading strategies more efficiently.… Continue Reading

The CSA and the IIROC Unveil Rules for Dark Marketplaces

Posted in Broker-Dealers, CSA, IIROC, Marketplaces

Canada has marketplaces, both “lit” and “dark”, where equity securities are traded. Lit marketplaces, such as TSX and Chi-X, generally display orders to market participants before trades occur, but offer some order types and practices that deviate from the display principle. For example, traders on lit markets can elect to keep a portion of an order dark by entering an “iceberg order.”… Continue Reading