CSA releases notice for comment on changes to trading fee…
The Canadian Securities Administrators (CSA) recently released a Notice and Request for Comment regarding proposed modifications to National Instrument 23-101 Trading Rules (Proposed Amendments) and revisions to Companion Policy 23-101 Trading Rules (Proposed CP Changes) in response to recent rule updates by the United States Securities and Exchange Commission (SEC).
These Proposed Amendments and Proposed CP Changes aim to maintain competitiveness in the trading of Canadian securities that are cross-listed on U.S.-registered national securities exchanges, known as U.S. Inter-listed Securities. Should these changes be approved, the alignment of the Canadian trading fee cap with that of the United States would persist for U.S. Inter-listed Securities valued at CAD 1.00 or higher. Stakeholders are invited to provide feedback on the Proposed Amendments and Proposed CP Changes during the 60-day comment period, which closes on March 24, 2025.
The genesis of these proposed adjustments and changes lies in the SEC’s final rules announced on September 18, 2024, inclusive of reduced trading fee caps for National Market System (NMS) stocks and decreased minimum pricing increments for select NMS stocks priced at USD 1.00 per share or more, collectively termed the SEC Final Rules.
Furthermore, on December 12, 2024, the Canadian Investment Regulatory Organization put forward Proposed UMIR Amendments that, upon enactment, would harmonize minimum pricing increments with the SEC Final Rules for U.S. Inter-listed Securities valued at CAD 1.00 or above. The comment period to gather input on the Proposed UMIR Amendments is set to conclude on January 27, 2025.
While the SEC initially slated the implementation of the SEC Final Rules for November 3, 2025, a subsequent order issued on December 12, 2024, by the SEC deferred the rules’ implementation pending the outcome of judicial review. Consequently, the Proposed Amendments, Proposed CP Changes, and Proposed UMIR Amendments will not take effect in Canada until after the SEC Final Rules are operational in the United States.
As the umbrella organization overseeing the securities regulators of Canada’s provinces and territories, the CSA is committed to coordinating and streamlining regulations for the Canadian capital markets.
For any inquiries from investors, it is advisable to reach out to local securities regulatory authorities to seek guidance and assistance.
