Fixed income market regulation update published by CSA

September 23, 2015

The Canadian Securities Administrators (CSA) has provided stakeholders with an update on the regulation of the fixed income market.  On September 17, 2015, the CSA published CSA Staff Notice 21-315 Next Steps in Regulation and Transparency of the Fixed Income Market to describe how the CSA wishes to enhance the regulation of the fixed income market, improve market transparency and better protect investor interests.  Our readers will recall that CSA Staff Notice 21-315 follows OSC Staff Notice 21-708 OSC Staff Report on the Canadian Fixed Income Market and Next Steps to Enhance Regulation and Transparency of Fixed Income Markets which we previously wrote about in April 2015.

The CSA notes that a number of recent or pending changes will allow for more informed decision-making among market participants.  Among these are the full implementation of CRM2 (Client Relationship Model – Phase 2) in July 2016 and enhanced SEDAR disclosure of trust indentures regarding debt and credit agreements.  The CSA also notes that the implementation of the IIROC Debt Reporting Rule will improve market integrity by creating a comprehensive source of trading data available to regulators.  

In terms of forthcoming initiatives, the CSA advised that it proposes to make trade information for corporate debt securities executed by dealers publicly available by the end of 2017.  The CSA is also studying whether exempt market dealers should be required to report fixed income trade information to IIROC.  Finally, a working group comprised of IIROC and CSA staff has been established to conduct a review of concerns related to whether smaller institutional investors can effectively access the fixed income market.  On this point, the CSA will determine whether further regulatory action is required based on the findings of the working group.

The CSA have asked that comments on the proposed plan be submitted by November 1, 2015.  For further information, please consult CSA Staff Notice 21-315.

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