CSA and IIROC to Consider Internalization

December 11, 2017

In the face of stakeholder concerns about the internalization of order flow, the Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) have announced an investigation into current internalization practices in the current regulatory environment.

  • Internalization: where a broker fills an order to buy or sell stock from the firm’s own inventory rather than routing the order to the market.

In addition to announcing the CSA and IROC’s planned review, Joint Canadian Securities Administrators/Investment Industry Regulatory Organization of Canada Staff Notice 23-319 Internalization in the Canadian Market also indicates that TMX Group is planning an industry roundtable. The CSA and IIROC will seek public consultation in the coming months.

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