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CSA Solicits Comments for Own Fee Pilot
Traders Magazine Online News, January 14, 2019
The Securities and Exchange Commission isn’t the only regulator soliciting comments for a proposed transaction fee pilot program.
The Canadian Securities Administrators (CSA) has recently formally announced it was publishing for comment a proposed Trading Fee Rebate Pilot Study that would apply temporary pricing restrictions on marketplace transaction fees applicable to trading in certain securities. The CSA is publishing the Proposed Pilot for a 45-day comment period to solicit views.
“We are seeking comment on all issues raised in this notice, including the design of the Proposed Pilot that is contained in the Design Report, as well as the specific questions raised within it,” the CSA wrote.
The comment period will end on February 1, 2019.
The CSA serves as an umbrella group for:
- British Columbia Securities Commission
- Alberta Securities Commission
- Financial and Consumer Affairs Authority of Saskatchewan
- Manitoba Securities Commission
- Ontario Securities Commission
- Autorité des marchés financiers
- Financial and Consumer Services Commission, New Brunswick
- Superintendent of Securities, Government of Prince Edward Island
- Nova Scotia Securities Commission
- Office of the Superintendent of Securities, Service NL (Newfoundland and Labrador)
- Superintendent of Securities, Northwest Territories
- Superintendent of Securities, Yukon
- Superintendent of Securities, Department of Justice, Government of Nunavut
The CSA has been considering a pilot study on the payment of trading fee rebates for many years in relation to our continued work to foster fair and efficient capital markets and confidence in capital markets. On May 15, 2014, it published a Notice and Request for Comment (the 2014 Notice) that proposed amendments to National Instrument 23-101 Trading Rules (NI 23-101) in relation to the order protection rule (OPR).Group[/caption]
On April 7, 2016, as a result of its review of OPR, CSA published a Notice of Approval of Amendments to NI 23-101 and Companion Policy 23-101CP (the 2016 Notice). 2 In the 2016 Notice, we acknowledged that we had been considering a pilot study for a number of years but, due to certain risks arising from the interconnected nature of North American markets and securities that are interlisted in the United States, it decided not to move forward with a pilot study unless a similar study was undertaken in the United States.
Nick Savona, COO at Independent Trading Group in Canada told Traders Magazine that the Canadian Securities Administrators should watch what happens in the US and then evaluate itss own pilot.
“I don't see a point in both countries running a similar pilot project simultaneously,” he said.
On March 14, 2018, the United States Securities and Exchange Commission (SEC) proposed new Rule 610T of Regulation National Market System (NMS) that would conduct a transaction fee pilot for NMS securities (the Proposed SEC Transaction Fee Pilot),4 and, as a result, CSA saw and moved forward with its own Canadian pilot study.
On March 16, 2018, CSA Staff Notice 23-322 Trading Fee Rebate Pilot Study was published to provide an update on our plans to study the impacts of transaction fees and rebates on order routing behavior, execution quality, and market quality, and noted that we have been engaged in dialogue with SEC staff on this issue.
“We are publishing for comment the design and specifications of the Proposed Pilot to solicit feedback. We will continue discussions with SEC staff about coordinating the pilot studies, where possible and appropriate,” the CSA said.
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