On January 29, 2020, IIROC’s Board of Directors approved housekeeping amendments (Amendments) to the following provisions of the Universal Market Integrity Rules (UMIR):
- UMIR 1.1 – Definition of “order execution service”
- Subparagraph (a)(iv) of subsection 6.2(1) – Designations and Identifiers
- Part 5 of Policy 6.4 – Application of UMIR to Orders Not Entered on a Marketplace
- Part 3 of Policy 7.1 – Supervision and Compliance Procedures for Trading on a Marketplace
- Part 4 of Policy 7.1 – Specific Procedures Respecting Client Priority
- Part 1 of Policy 8.1 – General Requirements for Client-Principal Trading
- Paragraph (e) of subsection 10.16(1) – Gatekeeper Obligations of Directors, Officers and Employees of Participants and Access Persons.
The Amendments replace rule references to the Dealer Member Rules with provisions of the IIROC Rules1 as follows:
- Dealer Member Rule 3200 – Minimum Requirements for Dealer Members Seeking Approval under Rule 1300.1(t) to offer an Order-Execution Only Service with Part D of IIROC Rule 3200 – Order Execution Only Accounts in the definition of “order execution service” of UMIR 1.1
- Dealer Member Rule 3200 with IIROC Rule 3241 in paragraph (1)(a) of section 6.2
- Dealer Member Rule 3300 with Part C of IIROC Rule 3100 – Best Execution of Client Orders in Part 5 of Policy 6.4, Parts 3 and 4 of Policy 7.1, Part 1 of Policy 8.1, and paragraph (e) of subsection UMIR 10.16(1).
The Amendments will become effective on June 1, 2020.
Discussion of the Amendments
The Canadian Securities Administrators approved the plain language rewrite of the Dealer Member Rules (collectively as the IIROC Rules) on August 22, 2019. As a result, we need to make housekeeping changes to UMIR to update rule references from the previous Dealer Member Rules with the current provisions in IIROC Rules.
Classification of the Amendments
We have classified the Amendments as “housekeeping” because they:
- do not represent a material change to IIROC rules
- have no material impact on investors, issuers, Participants or the capital markets in Canada as they:
- correct inaccurate cross-referencing and typographical mistakes
- make necessary changes of an editoral nature.
Impacts of the Amendments
We do not expect the Amendments to impact any stakeholders.
We do not expect the Amendments to impact a Participant’s systems or the systems of its service provicers.
Policy Development Process
The Amendments maintain rules that are necessary or appropriate to govern and regulate all aspects of IIROC’s functions and responsibilities as a self-regulatory entity.
In deciding on the Amendments, IIROC identified a need to ensure UMIR is up-to-date by correcting inaccurate cross-referencing and typographical mistakes.
The Amendments are housekeeping in nature and not detrimental to the best interests of the capital markets. As a result, the Board has classified the Amendments as a “Housekeeping Rule” that is not contrary to the public interest.