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Executive Summary
On July 25, 2019, the applicable securities regulatory authorities approved amendments to UMIR Rule 6.6 (Amendments) that modify the requirements for Dark Orders1 to provide a better price2 when trading against certain orders. Specifically, the Amendments add a minimum order value of $30,000 in addition to the current threshold of 50 standard trading units (STUs). Under the Amendments, an order may execute against a Dark Order without receiving a better price only if it is sufficiently large in both volume (over 50 STUs) and value (over $30,000).
The Amendments were published for comment on December 13, 2018 in IIROC Rules Notice 18-0231 – Rules Notice – Request for Comments – UMIR – Proposed Amendments Respecting Provision of Price Improvement by a Dark Order. All relevant background information, including the description and impact of the Amendments, is set out in that notice.
- 1Please see “Dark Order” definition in UMIR Rule 1.1.
- 2Please see “better price” definition in UMIR Rule 1.1.
Comments Received
We received ten comment letters in response to IIROC Notice 18-0231. Appendix C provides a summary of the public comments received and our responses.
We have not made any revisions to the Amendments, as set out in IIROC Notice 18-0231.
Attachments
Appendix A – Text of Final UMIR Amendments
Appendix B – Blackline of Amendments to UMIR
Appendix C – Summary of comments received and IIROC’s responses
Implementation
Participants, marketplaces and vendors will be required to make necessary technology changes to ensure that orders with a notional dollar value of less than $30,000 do not trade against a Dark Order unless the order receives a better price.
The Amendments are effective on February 4, 2020, being 180 days after the publication of this Notice.