The Investment Industry Regulatory Organization of Canada (IIROC) published a notice yesterday with respect to the best execution and best price obligations of Participants under the Universal Market Integrity Rules (UMIR). The notice is not intended to change previous guidance on "best execution" and "best price" obigations, but "simply reminds Participants of their obligations given that securities listed on the TSXV now trade on other marketplaces."

Rule 5.1 of UMIR states that Participants "shall diligently pursue the execution of each client order on the most advantageous terms for the client as expeditiously as practicable under prevailing market conditions" and the notice makes clear that, in doing so, Participants are expected to consider trade and order information from all marketplaces that trade the same securities. With respect to Rule 5.2, IIROC states that Participants must review its policies and procedures "on an ongoing basis to reflect changes to the trading environment and market structure (which would include the fact that securities listed on TSXV now trade on multiple marketplaces)."

The notice notes that while over 98% of trades and volume in TSXV-listed securities are made through the TSXV, an increase in trading activity on alternative trading systems "indicates that trading opportunities in TSXV-listed securities are increasingly available" on such alternate systems.