In April 2015, the Ontario Securities Commission (OSC) approved changes to the TSX Alpha Exchange trading model. Effective September 2015, Alpha will apply a short processing delay (a speed bump) on orders to counter high-frequency trading and limit fleeting liquidity. Additionally, orders displayed in the Alpha order book will no longer be protected from trade-through (i.e. the execution of an order at a price that is inferior to a displayed bid price or higher than a displayed offer price) under the Order Protection Rule (OPR). 

In response, the Investment Industry Regulatory Organization of Canada (IIROC) announced in June 2015 that it is re-examining the application of the OPR to all marketplaces which impose order processing delays. Specifically, it announced that exchanges that have speed bumps will no longer be considered protected marketplaces. 

The IIAC commented on IIROC’s Proposed Amendments. While the IIAC appreciates IIROC’s timely response to provide clarification and guidance for Dealer Members regarding marketplaces that impose order processing delays, additional guidance and clarity is required with respect to: dark pool access; client-principal trading; and the Canadian Securities Administrators (CSA) issuing new rules regarding locking and crossing of markets. More details about our position are provided in our submission.