Ontario Securities Commission Bulletin
Issue 49/16 - April 23, 2026
Ont. Sec. Bull. Issue 49/16
• Ontario Securities Commission and Shane Courtney Ward
• Ontario Securities Commission et al.
• Ontario Securities Commission and Liquidnet Canada Inc.
• Ontario Securities Commission et al.
• Ontario Securities Commission et al.
• Ontario Securities Commission and Shane Courtney Ward -- ss. 127(1), 127(4.0.2)
• Ontario Securities Commission and Liquidnet Canada Inc. -- ss. 127(1), 127.1
• Ontario Securities Commission et al.
• Peter Michael Deeb et al. -- s. 8
• Ontario Securities Commission and Liquidnet Canada Inc. -- ss. 127(1), 127.1
• Notice of Agreement to Facilitate the Initial Cross-listing of Securities in France and Canada
• Harvest Portfolios Group Inc.
• National Bank Investments Inc. and NBI SmartData Enhanced Yield U.S. Equity Fund
• Temporary, Permanent & Rescinding Issuer Cease Trading Orders
• Temporary, Permanent & Rescinding Management Cease Trading Orders
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Ontario Securities Commission and Shane Courtney Ward
FOR IMMEDIATE RELEASE
April 15, 2026
TORONTO -- The Tribunal issued an Order in the above-named matter.
A copy of the Application for Enforcement Proceeding dated March 31, 2026 and the Order dated April 15, 2026, are available at capitalmarketstribunal.ca.
Subscribe to notices and other alerts from the Capital Markets Tribunal:
For Media Inquiries:
For General Inquiries:
Ontario Securities Commission et al.
FOR IMMEDIATE RELEASE
April 15, 2026
TORONTO -- A motion hearing in the above-named matter is scheduled to be heard on April 27, 2026 at 11:00 a.m. by videoconference.
Members of the public may observe the hearing by videoconference, by selecting the "View by Zoom" link on the Tribunal's hearing schedule, at capitalmarketstribunal.ca/en/hearing-schedule.
Subscribe to notices and other alerts from the Capital Markets Tribunal:
For Media Inquiries:
For General Inquiries:
Ontario Securities Commission and Liquidnet Canada Inc.
FOR IMMEDIATE RELEASE
April 15, 2026
TORONTO -- Following a hearing held today, the Tribunal issued an Order in the above-named matter approving the Settlement Agreement reached between the Commission and Liquidnet Canada Inc.
A copy of the Order dated April 15, 2026, Settlement Agreement dated April 8, 2026, and Oral Reasons for Approval of a Settlement dated April 15, 2026, are available at capitalmarketstribunal.ca.
Subscribe to notices and other alerts from the Capital Markets Tribunal:
For Media Inquiries:
For General Inquiries:
Ontario Securities Commission et al.
FOR IMMEDIATE RELEASE
April 15, 2026
TORONTO -- The previous scheduled days of May 11, 12, 14, 15, 20 and 22, 2026 will not be used for the merits hearing in the above-named matter.
The merits hearing shall begin on May 26, 2026, at 10:00 a.m. and continue on May 27, 28, 29, June 1, 2, 3, 4, 5, 8, 9, 10, 12, July 7, 8, 9, 10, 13 and 14, 2026 at 10:00 a.m. on each day.
The hearing will be held at the offices of the Tribunal at 20 Queen Street West, 17th floor, Toronto.
Members of the public may observe the hearing by videoconference, by selecting the "View by Zoom" link on the Tribunal's hearing schedule, at www.capitalmarketstribunal.ca/en/hearing-schedule.
Subscribe to notices and other alerts from the Capital Markets Tribunal:
For Media Inquiries:
For General Inquiries:
Ontario Securities Commission et al.
FOR IMMEDIATE RELEASE
April 17, 2026
TORONTO -- The Tribunal issued an Order in the above-named matter.
A copy of the Order dated April 17, 2026 is available at capitalmarketstribunal.ca.
Subscribe to notices and other alerts from the Capital Markets Tribunal:
For Media Inquiries:
For General Inquiries:
FOR IMMEDIATE RELEASE
April 20, 2026
TORONTO -- The Tribunal issued an Order in the above-named matter.
A copy of the Order dated April 20, 2026 is available at capitalmarketstribunal.ca.
Subscribe to notices and other alerts from the Capital Markets Tribunal:
For Media Inquiries:
For General Inquiries:
Ontario Securities Commission et al.
FOR IMMEDIATE RELEASE
April 20, 2026
TORONTO -- The Tribunal issued an Order in the above-named matter.
A copy of the Order dated April 20, 2026 is available at capitalmarketstribunal.ca.
Subscribe to notices and other alerts from the Capital Markets Tribunal:
For Media Inquiries:
For General Inquiries:
Ontario Securities Commission and Nayeem Alli
FOR IMMEDIATE RELEASE
April 21, 2026
TORONTO -- The Tribunal issued an Order in the above-named matter.
A copy of the Order dated April 20, 2026 is available at capitalmarketstribunal.ca.
Subscribe to notices and other alerts from the Capital Markets Tribunal:
For Media Inquiries:
For General Inquiries:
Ontario Securities Commission and Shane Courtney Ward -- ss. 127(1), 127(4.0.2)
BETWEEN:
File No. 2026-20
Adjudicator: |
Cathy Singer |
April 15, 2026
(Subsections 127(1) and 127(4.0.2) of the Securities Act, RSO 1990, c S.5)
WHEREAS the Capital Markets Tribunal held a hearing in writing to consider an application brought by the Ontario Securities Commission for an order imposing sanctions against the Respondent Shane Courtney Ward, without giving the Respondent an opportunity to be heard, pursuant to subsection 127(1) and 127(4.0.2) of the Securities Act, RSO 1990, c S.5 (the Act);
ON READING the materials filed by the Commission, including the Merits Decision of the Alberta Securities Commission, dated October 19, 2022 and the Sanctions Decision of the Alberta Securities Commission dated May 8, 2023;
IT IS ORDERED THAT:
1. pursuant to paragraph 2 of subsection 127(1) of the Act, trading in any securities or derivatives by Ward shall cease permanently, except that this order does not preclude Ward from trading in securities or derivatives in a registered retirement savings plan, registered education savings plan, any registered retirement income funds, tax-free savings account (as defined in the Income Tax Act, RSC 1985, c 1 (5th Supp) (the Income Tax Act)) and/or locked-in retirement accounts in which he has a beneficial ownership, provided that he carries out any permitted trading through a registered dealer, which dealer must be given a copy of this order;
2. pursuant to paragraph 2.1 of subsection 127(1) of the Act, Ward is permanently prohibited from acquiring any securities, except that this order does not preclude Ward from acquiring securities or derivatives in a registered retirement savings plan, registered education savings plan, any registered retirement income funds, tax-free savings account (as defined in the Income Tax Act) and/or locked-in retirement accounts in which he has a beneficial ownership, provided that he carries out any permitted acquisitions through a registered dealer, which dealer must be given a copy of this order;
3. pursuant to paragraph 3 of subsection 127(1) of the Act, any exemptions contained in Ontario securities law do not apply to Ward permanently;
4. pursuant to paragraphs 7, 8.1, and 8.3 of subsection 127(1) of the Act, Ward shall resign any positions that he holds as a director or officer of any issuer, registrant or investment fund manager;
5. pursuant to paragraph 8, 8.2 and 8.4 of subsection 127(1) of the Act, Ward is permanently prohibited from becoming or acting as a director or officer of any issuer, registrant or investment fund manager; and
6. pursuant to paragraph 8.5 of subsection 127(1) of the Act, Ward is permanently prohibited from becoming or acting as a registrant, an investment fund manager or a promoter.
BETWEEN:
(Subsections 127(1) and 127(4.0.2) of the Securities Act, RSO 1990, c S.5)
1. The Applicant, the Ontario Securities Commission (the Commission), requests that the Capital Markets Tribunal (the Tribunal) make an order in the public interest against the Respondent, Shane Courtney Ward (Ward), reciprocating an order made by the Alberta Securities Commission (the ASC), without providing the Respondent an opportunity to be heard.
2. The ASC found that Ward and his investment business, Engineered Wealth (E-Wealth), knowingly made misleading statements to investors, perpetuated a fraud on investors, and distributed securities without a prospectus, contrary to Alberta securities law. Namely, the ASC found that Ward made misrepresentations to E-Wealth investors that their principal investments would be protected and that they would receive a set rate of return. Investors advanced funds to E-Wealth with the expectation that he would invest the funds on their behalf and generate profit. Instead, Ward diverted funds for unauthorized uses and to pay other investors their purported returns.
3. The sanctions imposed by the ASC against Ward included permanent trading, director and officer, and other market participation bans.
4. The Tribunal has jurisdictions to make an order in the public interest under ss. 127(1) and 127(4.0.2) of the Securities Act, RSO 1990, c S.5 (the Act), reciprocating an order made by a securities regulatory authority of another province that imposes sanctions, conditions, restrictions, and requirements on a person or company.
5. The order requested herein is in the public interest. It is necessary to restrain potential future misconduct by the Respondent that exposes Ontario investors to unacceptable risks and to deter others from engaging in illegal distributions and fraudulent conduct.
6. A hearing of allegations occurred before a panel of the ASC (the ASC Panel) in 2021. Ward participated in the hearing with counsel.
7. In its merits decision dated October 19, 2022 (the Merits Decision), the ASC held that Ward breached the following sections of the Alberta Securities Act, RSA 2000, c S-4 (the Alberta Act):
(a) s. 92(4.1) by making statements to investors that Ward knew or reasonably ought to have known: (i) were, in a material respect, misleading or untrue or did not state facts that were required to be stated or were necessary to make the statements not misleading; and (ii) would reasonably be expected to have a significant effect on the market price or value of a security;
(b) s. 93(1)(b) by directly or indirectly engaging or participating in an act, practice, or course of conduct relating to securities that he knew or ought to have known would perpetrate a fraud on investors; and
(c) s. 110(1) by distributing securities: (i) without having filed and received a receipt for a preliminary prospectus or prospectus from the Executive Director of the ASC; and (ii) without an exemption from that requirement for some or all of the relevant distributions.
8. On May 8, 2023, the ASC issued its sanctions decision (the Sanctions Decision) and an order that imposed the following sanctions on Ward:
(a) Pursuant to s. 198(1)(b) of the Alberta Act, Ward shall permanently cease trading in or purchasing derivatives, unless purchased through a registrant (who has been provided with a copy of the Sanctions Decision) in registered retirement savings plans, registered retirement income funds, registered education savings plans and tax-free savings accounts (each as defined in the Income Tax Act (Canada) and locked-in retirement accounts;
(b) Under s. 198(1) (c) of the Alberta Act, all of the exemptions contained in Alberta securities laws do not apply to Ward;
(c) Under s. 198(1)(c.1) of the Alberta Act, Ward is prohibited from engaging in investor relations activities;
(d) Pursuant to s. 198(1)(d) of the Alberta Act, Ward must resign from all positions he holds as a director and/or officer of any issuer, registrant, investment fund manager, recognized exchange, recognized self-regulatory organization, recognized clearing agency, recognized trade repository, designated rating organization, designated information processor, recognized quotation and trade reporting system, or designated benchmark administrator;
(e) Pursuant to s. 198(1)(e) of the Alberta Act, Ward is prohibited from becoming or acting as a director and/or officer of any issuer, registrant, investment fund manager, recognized exchange, recognized self-regulatory organization, recognized clearing agency, recognized trade repository, designated rating organization, designated information processor, recognized quotation and trade reporting system, or designated benchmark administrator; and
(f) Pursuant to s. 198(e.1), (e.2), and (e.3) of the Alberta Act, Ward is prohibited from advising in securities or derivatives, becoming or acting as a registrant, investment fund manager, or promotor; and was prohibited from acting in a management or consultative capacity in connection with the securities market.
9. Ward was also ordered to pay an administrative penalty of $100,000 under s. 99 of the Alberta Act, disgorgement of $106,610.22 under s. 198(1)(i) of the Alberta Act, and costs of $98,400 under s. 202(1) of the Alberta Act.
10. The Commission relies on the following findings made by the ASC Panel in the Merits Decision and Sanctions Decision:
(a) During the material time, Ward was a resident of Edmonton.
(b) Ward was an engineer who began investing through QTrade.
(c) Ward claimed that due to his purported success with investing, he began being approached by others to trade on their behalf, and once he had some success trading for others, he consulted a securities lawyer (AC).
(d) AC advised Ward that he could operate a non-registered, non-reporting private fund and offer exempt securities to certain qualified investors without having to register under securities laws, if he limited the number of investors to 50. AC then prepared subscription agreements for Ward to use.
(e) In February 2011, Ward began selling units in E-Wealth, priced at $500 per unit (Units), using the subscription agreements.
(f) Around 2013, AC informed Ward that due to recent changes in securities law, Ward would need to register as a fund manager or portfolio manager to continue running E-Wealth and collecting investments.
(g) Instead of registering or ceasing E-Wealth's investment business, Ward and AC amended the subscription agreements so that each Unit consisted of a $5000 promissory note.
(h) Ward then continued raising funds from investors using subscription agreements that incorporated the promissory notes.
(i) The new subscription agreements included specified rates of return; in addition, Ward sent emails to investors which included specified rates of return.
(j) Ward made written and verbal representations to investors that he would protect their principal investment, and several investors testified that they did not think it was possible that they would lose their principal investment.
(k) During this later promissory note phase, Ward and E-Wealth also entered into two investment loan agreements, a loan agreement, and an undocumented investment (pursuant to an oral agreement) with three investors.
(l) The ASC Panel found that all investments made in connection with the subscription agreements, the investment loan agreements and loan agreements, and the undocumented investment constituted securities under the Alberta Act.
(m) Between 2013 and 2017, Ward raised $555,909.68 from investors.
(n) Ward used investor fund for unauthorized purposes, including for personal use and to pay other investors their purported returns.
(o) By late 2017, E-Wealth failed and nearly all the investors lost their principal investment and received no returns.
11. The Units offered by Ward and E-Wealth are securities under the Act.
12. Pursuant to paragraph 2 of subsection 127(4.0.2) of the Act, the Tribunal may make any of the orders described in paragraphs 1 to 8.5 of subsection 127(1) of the Act against the Respondent, without giving the Respondent an opportunity to be heard, where the Respondent is subject to an order made in a securities regulatory authority of another province or territory in Canada, imposing sanctions, conditions, restrictions or requirements.
13. The ASC, which is a "securities regulatory authority of another province or territory in Canada", as defined in subsection 127(10) of the Act, issued an order imposing sanctions against the Respondent within the meaning of s. 127(4.0.2).
14. Section 127(4.0.4) of the Act expressly allows the Tribunal to make an order under s. 127(4.0.2) even though the ASC Decision predates the coming into force of s. 127(4.0.2).
15. It is in the public interest to make the requested order. Ward poses a risk to Ontario investors. The requested order is necessary to protect the investing public and safeguard the integrity of Ontario's capital markets.
16. The Commission requests that the Tribunal make the following order against Ward:
(a) pursuant to paragraph 2 of subsection 127(1) of the Act, trading in any securities or derivatives by Ward cease permanently, except that this order does not preclude Ward from trading in securities or derivatives in a registered retirement savings plan, registered education savings plan, any registered retirement income funds, and/or tax-free savings account (as defined in the Income Tax Act (Canada)) in which he has a beneficial ownership, provided that he carries out any permitted trading through a registered dealer, which dealer must be given a copy of this order;
(b) pursuant to paragraph 2.1 of subsection 127(1) of the Act, Ward is permanently prohibited from acquiring any securities, except that this order does not preclude Ward from acquiring securities or derivatives in a registered retirement savings plan, registered education savings plan, any registered retirement income funds, and/or tax-free savings account (as defined in the Income Tax Act (Canada)) in which he has a beneficial ownership, provided that he carries out any permitted acquisitions through a registered dealer, which dealer must be given a copy of this order;
(c) pursuant to paragraph 3 of subsection 127(1) of the Act, any exemptions contained in Ontario securities law do not apply to Ward permanently;
(d) pursuant to paragraphs 7, 8.1, and 8.3 of subsection 127(1) of the Act, Ward shall resign any positions that he holds as a director or officer of any issuer, registrant or investment fund manager;
(e) pursuant to paragraph 8, 8.2 and 8.4 of subsection 127(1) of the Act, Ward is permanently prohibited from becoming or acting as a director or officer of any issuer, registrant or investment fund manager;
(f) pursuant to paragraph 8.5 of subsection 127(1) of the Act, Ward is permanently prohibited from becoming or acting as a registrant, an investment fund manager or a promoter; and
(g) such other order or orders as the Tribunal considers appropriate.
March 31, 2026 |
ONTARIO SECURITIES COMMISSION |
20 Queen Street West, 22nd Floor |
|
Toronto, ON M5H 3S8 |
|
|
|
Emma Coffin |
|
Litigation Counsel |
|
Enforcement Division |
|
LSO# 91018N |
|
|
|
Tel: (416) 593-2374 |
|
Email: ecoffin@osc.ca |
|
Ontario Securities Commission and Liquidnet Canada Inc. -- ss. 127(1), 127.1
BETWEEN:
File No. 2026-15
Adjudicators: |
M. Cecilia Williams (chair of the panel) |
Judith Robertson |
|
Cathy Singer |
April 15, 2026
(Subsection 127(1) and section 127.1 of the Securities Act, RSO 1990, c S.5)
WHEREAS on April 15, 2026, the Capital Markets Tribunal held a hearing by videoconference to consider the joint request for a settlement hearing filed by the Ontario Securities Commission and Liquidnet Canada Inc. for approval of a settlement agreement dated April 8, 2026 (the Settlement Agreement);
ON READING the joint request for a settlement hearing, the Application for Enforcement Proceeding dated April 10, 2026, the Settlement Agreement and the written submissions of the Commission, on hearing the submissions of the representatives of the Commission and Liquidnet Canada, and on being advised by the Commission that it has received payments from the respondent in the amounts of $600,000 and $75,000;
IT IS ORDERED THAT:
1. the Settlement Agreement is approved;
2. Liquidnet Canada shall submit to a review of its practices and procedures by an independent consultant acceptable to the Commission, at Liquidnet Canada's expense, in accordance with the terms of reference set out in Schedule "A" to this Order, pursuant to paragraph 4 of subsection 127(1) of the Securities Act (the Act);
3. Liquidnet Canada is reprimanded pursuant to paragraph 6 of subsection 127(1) of the Act;
4. Liquidnet Canada shall pay an administrative penalty of $600,000 for failures to comply with Ontario securities law, pursuant to paragraph 9 of subsection 127(1) of the Act; and
5. Liquidnet Canada shall pay $75,000 to the Commission for costs of the investigation and hearing, pursuant to section 127.1 of the Act.
1. Liquidnet Canada Inc. (LCI) shall retain an independent consultant acceptable to the Commission to review LCI Fixed Income ATS and LCI Equities ATS' systems (the ATS Systems) and controls around the ATS Systems, including LCI's operations, agreements (including for outsourcing), internal controls, practices, policies, and procedures, relating to confidential treatment of order and trade information to ensure that:
(a) The ATS Systems are not designed to release or make visible marketplace participants' order or trade information to unauthorized persons or companies, including employees of LCI's affiliates, and access to the ATS Systems is appropriately restricted and aligns with each employee's authorized roles and responsibilities;
(b) The safeguards and procedures to protect marketplace participants' order or trade information, including limiting access to order or trade information of marketplace participants to employees of LCI or persons or companies retained by the marketplace to operate the system and implementing standards controlling trading by employees of LCI for their own accounts, are adequate and reasonable;
(c) The oversight procedures to ensure that the safeguards and procedures established under subsection (b) are adequate;
(d) LCI takes appropriate measures to ensure that the service providers, including its affiliates, protect the marketplace participants' proprietary, order, trade, or any other confidential information for the key services and systems that LCI outsources to the service providers;
2. The Consultant shall be appointed promptly following the approval of the Settlement Agreement, but in any event no later than 30 days following the approval, unless the Commission requires further time to approve the proposed Consultant.
3. Within 30 days of the Consultant's appointment, LCI shall require the Consultant to provide a detailed review plan (the "Review Plan") to an Associate Vice President or Senior Vice President in the Trading and Markets Division of the Commission (the "OSC VP"). The Consultant shall implement any changes to the Review Plan required by the OSC VP.
4. LCI shall require the Consultant to deliver to the OSC VP a written report describing the Consultant's findings, LCI management's response to the findings, and recommendations by the Consultant for each finding to ensure that the ATS Systems conform with the obligations set out in paragraph 1 above (the "Report"), within 180 days of the approval by the OSC VP of the Review Plan;
5. Within 6 months of the delivery of the Report to the OSC VP, LCI shall use best efforts to implement any recommendations of the Consultant described in the Report, and the Ultimate Designated Person and the Chief Compliance Officer of LCI shall provide written confirmation to the OSC VP of the implementation efforts of the Consultant's recommendations in the Report (the Confirmation Letter);
6. Within 90 days after the delivery of the Confirmation Letter to the OSC VP, LCI shall cause the Consultant to conduct appropriate testing to determine whether the recommendations in the Report have been fully implemented, and whether any changes resulting from those recommendations are being appropriately followed, administered and enforced by LCI (Final Testing)
7. Within 60 days of completing the testing, the Consultant shall provide a letter (the Attestation Letter) to the OSC VP, expressing his or her conclusions with respect to the Final Testing and:
(a) include a report with the Attestation Letter which provides a detailed description of the testing performed to support the conclusions contained in the Attestation Letter; and
(b) submit such additional reports as may be requested by the OSC VP for the purpose of satisfying the OSC VP that the conclusions expressed in the Attestation Letter described above are valid;
8. If the Commission is not satisfied with the Consultant's recommendations, or with LCI's efforts to implement the recommendations of the Consultant, then after providing the Consultant with a reasonable opportunity to revise its recommendations, or after providing LCI with a reasonable opportunity to comply with the recommendations of the Consultant, if the Consultant or LCI has still not done so, as the case may be, the Commission may bring the matter to the Tribunal for determination of whether a further order under s. 127(1)4 of the Act is warranted.
9. LCI shall provide the Consultant with reasonable access to all of LCI's books and records necessary to complete the Consultant's mandate and will allow the Consultant to meet privately with LCI's officers, directors and employees. LCI shall require its officers, directors and employees to cooperate fully with the Consultant with respect to the Consultant's work and with respect to the implementation of the recommendations in the Report;
10. LCI shall not terminate the Consultant's engagement and retainer without prior written approval by the OSC VP;
11. LCI shall provide the Commission a direction giving consent for unrestricted access and permission for the Commission and the Consultant to communicate with one another regarding the Consultant's work and LCI's progress with respect to the implementation of the recommendations in the Report and/or any other matter relevant to this review; and
12. For greater certainty, the terms of this review do not limit in any respect the authority of the Commission to undertake, as part of its normal course activities, a review of all matters within the scope of this review or any other aspect of LCI's business.
BETWEEN:
1. This case involves inadequate controls by a marketplace over the confidential trade and order information of marketplace participants.
2. Liquidnet Canada Inc. (LCI), a registered investment dealer, has operated fixed income and equities alternative trading systems (ATSs). In 2023, LCI discovered that certain order and trade information of participants in LCI's fixed income ATS were visible to certain employees of LCI's foreign affiliates, who were not authorized under Ontario law to view the information. The available evidence does not indicate whether such employees actually viewed this information or whether information was visible to third parties. The order and trade information visible to these employees did not include indications of interest submitted to LCI's fixed income ATS.
3. After self-identifying the problem, LCI voluntarily suspended trading in Canadian debt securities on its fixed income ATS, and delivered an incident report to the Ontario Securities Commission (the Commission). The report represented that the shutdown of its fixed income ATS was necessary for "system enhancements", but was not as forthcoming as it should have been about the underlying issue, namely that order and trade information was visible to certain employees of LCI's foreign affiliates.
4. It later came to light that the LCI Equities ATS infrastructure permitted access to participant order and trade information without consent in connection with orders placed on its equities ATS. Such access extended to employees of foreign affiliates of LCI who were not authorized to see it. The available evidence does not disclose whether such employees actually viewed this information or whether information was visible to third parties. The order and trade information visible to employees of LCI's US affiliate did not include indications of interest submitted to the LCI Equities ATS.
5. When marketplaces, including alternative trading systems, permit access to confidential participant order or trade information without consent, they undermine investor confidence and the fairness and efficiency of our markets. Marketplaces must have a robust compliance system in place to address all relevant risks, including those associated with operating a shared technology platform in multiple jurisdictions. Marketplaces must also provide the Commission with accurate information when suspending trading or responding to the Commission's inquiries.
6. LCI and the Commission (together, the Parties) wish to resolve, on consent and without a hearing on the merits, issues arising from LCI's handling and protection of marketplace participants' order and trade information in connection with its ATSs, on the terms set out in this settlement agreement (the Settlement Agreement).
7. The Parties will jointly file a request that the Tribunal issue a Notice of Hearing (the Notice of Hearing) to announce that it will hold a hearing (the Settlement Hearing) to consider whether, pursuant to sections 127 and 127.1 of the Securities Act, RSO 1990, c S.5, as amended (the Act), it is in the public interest for the Tribunal to make certain orders against LCI.
8. The Commission and LCI jointly recommend settlement of the proceeding (the Proceeding) against LCI in accordance with the terms and conditions set out in this Settlement Agreement. LCI consents to the making of an order (the Order) substantially in the form attached as Schedule "A" to this Settlement Agreement based on the facts set out herein.
9. For the purposes of the Proceeding, and any other regulatory proceeding commenced by the Commission or another securities regulatory authority, LCI agrees with the facts set out in Part III of this Settlement Agreement and the conclusions in Part IV and V of this Settlement Agreement.
10. LCI is a corporation incorporated under the laws of Canada. LCI is one of a family of companies that include Liquidnet, Inc., LCI's US-based affiliate (Liquidnet US), and Liquidnet Europe Limited, Liquidnet's UK-based affiliate.
11. LCI has been registered with the Commission as an investment dealer since 2004.
12. LCI operated an ATS where marketplace participants can submit indications of interest which can match with other indications of interest that can result in trading in fixed income products (the LCI Fixed Income ATS) until August 2023, when LCI suspended trading of Canadian debt securities on it, as described further below.
13. LCI has also operated an ATS where marketplace participants can submit indications of interest which can match with other indications of interest that can result in trading in equities products (the LCI Equities ATS). LCI continues to operate the LCI Equities ATS.
14. Certain order and trade information of Canadian marketplace participants on the LCI Fixed Income ATS and on the LCI Equities ATS has been visible to employees of certain LCI foreign affiliates. The available evidence does not disclose whether the employees of LCI's affiliates actually viewed or accessed this information or whether information was visible to third parties. The order and trade information visible to the employees of LCI's affiliates did not include indications of interest submitted to the LCI Fixed Income ATS or LCI Equities ATS.
15. Certain of these employees were not authorized under Ontario securities law to see this order and trade information. These employees were not authorized to see it because access by these employees to this order and trade information was not required in order for LCI to provide services to these marketplace participants, and the marketplace participants did not consent to have this order and trade information shared with these employees of certain of LCI's foreign affiliates.
16. By, at the latest, June 30, 2023, LCI became aware that its fixed income staff could potentially access certain order and trade information of clients of Liquidnet US, and that, vice versa, certain employees of LCI affiliates could also access order and trade information of LCI's marketplace participants on the LCI Fixed Income ATS. After self-identifying the issue, LCI suspended trading of Canadian debt securities on the LCI Fixed Income ATS on or about August 29, 2023 so that the issue could be remediated.
17. On August 30, 2023, LCI communicated the fact of the shutdown to the Commission and provided an incident report (the Incident Report). The Incident Report indicated:
(a) that "Liquidnet is making system enhancements that impact the Marketplace which require us to suspend trading to complete the enhancements";
(b) that "there was no "incident" causing the suspension. Rather, to update the system we need to briefly suspend trading in fixed income securities";
(c) that the suspension began "in connection with discussions of systems enhancements"; and
(d) that "Liquidnet regularly reviews it systems and determined an enhancement was warranted".
18. The Incident Report did not indicate that there was visibility of LCI's marketplace participants' trade and order information on the LCI Fixed Income ATS to employees of LCI foreign affiliates, nor that the visibility issue precipitated the perceived need for "system enhancements".
19. In September and October 2023, the Commission and LCI exchanged correspondence regarding the suspension of trading on the LCI Fixed Income ATS, including updates on the contemplated completion of the system enhancements and the resumption of trading. In the course of this correspondence, LCI's responses to the Commission were unclear in respect of the degree to which the systems used by LCI and its affiliates were segregated, and did not, at this time, advise that employees of LCI affiliates could access trade and order information of LCI's marketplace participants.
20. At a quarterly meeting with the Commission on November 1, 2023, and in subsequent correspondence with the Commission, LCI advised that the suspension of trading on the LCI Fixed Income ATS was related to the visibility issues described above.
21. LCI's communications to the Commission in Fall 2023 were not as forthright as they could have been, and LCI ought to have advised the Commission of the visibility issue earlier than it did.
22. By October 2024, LCI realized that there was also unauthorized visibility of marketplace participants' information on the LCI Equities ATS, which LCI promptly reported to the Commission.
23. Prior to 2023, LCI failed to implement reasonable safeguards and procedures to protect its marketplace participants' order and trade information. LCI has since increased safeguards and procedures.
24. Further, LCI's oversight procedures to ensure that the safeguards and procedures that it has now established to protect its marketplace participants' order and trade information are followed were inadequate.
25. LCI outsources some of its key services and systems to one or more affiliates, including the provision of its trading technology. LCI's outsourcing arrangements do not require those affiliates to implement reasonable safeguards to protect LCI's marketplace participants' order and trade information, nor do they require those affiliates to implement adequate oversight procedures.
26. LCI has fully co-operated with the Commission's investigation into this matter.
27. The Respondent admits that the foregoing conduct described in Part III was contrary to subsections 5.10(1), (2), and (3) of National Instrument 21-101 Marketplace Operation (NI 21-101).
28. The Parties agree that it is in the public interest for the Tribunal to issue an order pursuant to sections 127 and 127. 1 of the Act.
29. Specifically, the Parties agree to jointly request that the Tribunal make the Order substantially in the form attached as Schedule "A", pursuant to which it is ordered that:
(a) this Settlement Agreement is approved;
(b) LCI shall pay an administrative penalty of $600,000 (CAD) for failures to comply with Ontario securities law, pursuant to paragraph 9 of subsection 127(1) of the Act;
(c) LCI shall submit to a review of its practices and procedures by an independent consultant acceptable to the Commission, at LCI's expense, in accordance with the terms of reference set out in Schedule 1 to Order, pursuant to paragraph 4 of subsection 127(1);
(d) LCI shall be reprimanded, and the reprimand shall be received orally by a current officer of LCI, pursuant to paragraph 6 of subsection 127(1); and
(e) LCI shall pay $75,000 (CAD) toward the costs of the Commission's investigation and proceeding, pursuant to section 127.1 of the Act.
30. LCI shall pay the amounts set out in the preceding paragraph by wire transfer to the Commission prior to the issuance of the Order. In the event the Order is not granted by the Tribunal, the amounts will be returned forthwith to LCI.
31. The Respondent acknowledges that this Settlement Agreement and the Order may form the basis for orders of parallel effect in other jurisdictions in Canada. The securities laws of some other Canadian jurisdictions allow orders made in this matter to take effect in those other jurisdictions automatically, without further notice to the Respondent.
32. If the Tribunal approves this Settlement Agreement, no enforcement proceedings will be continued against the Respondent under Ontario securities law based on the misconduct described in Part III of this Settlement Agreement, unless the Respondent fails to comply with any term in this Settlement Agreement, in which case enforcement proceedings may be brought or continued under Ontario securities law against the Respondent that may be based on, among other things, the facts set out in Part III of this Settlement Agreement as well as the breach of this Settlement Agreement.
33. The Respondent acknowledges that, if the Tribunal approves this Settlement Agreement and the Respondent fails to comply with any term in it, proceedings may be brought in order to ensure compliance with the terms of the Settlement Agreement.
34. The Respondent waives any defences to a proceeding referenced in the two preceding paragraphs that are based on the limitation period in the Act, provided that no such proceeding shall be commenced later than six years from the date of the occurrence of the last failure to comply with this Settlement Agreement.
35. The parties will seek approval of this Settlement Agreement at the Settlement Hearing before the Tribunal, which shall be held on a date determined by the Tribunal's Governance and Tribunal Secretariat in accordance with this Settlement Agreement and the Tribunal's Rules of Procedure.
36. The Respondent will attend the Settlement Hearing in person or by video conference.
37. The parties confirm that this Settlement Agreement sets forth all of the agreed facts that will be submitted at the Settlement Hearing, unless the parties agree that additional facts should be submitted at the Settlement Hearing.
38. If the Tribunal approves this Settlement Agreement:
(a) the Respondent irrevocably waives all rights to a full hearing, judicial review or appeal of this matter under the Act; and
(b) neither party will make any public statement that is inconsistent with this Settlement Agreement or with any additional agreed facts submitted at the Settlement Hearing.
39. Whether or not the Tribunal approves this Settlement Agreement, the Respondent will not use, in any proceeding, this Settlement Agreement or the negotiation or process of approval of this Settlement Agreement as the basis for any attack on the Commission or the Tribunal's jurisdiction, alleged bias, alleged unfairness or any other remedies or challenges that may be available.
40. If the Tribunal does not approve this Settlement Agreement or does not make an order substantially in the form of the Order attached as Schedule "A" to this Settlement Agreement:
(a) this Settlement Agreement and all discussions and negotiations between the parties before the Settlement Hearing will be without prejudice to the Commission and the Respondent; and
(b) the Commission and the Respondent will each be entitled to all available proceedings, remedies and challenges, including proceeding to a hearing on the merits of the allegations contained in an Application for Enforcement Proceeding based on the conduct described herein. Any such proceedings, remedies and challenges will not be affected by this Settlement Agreement, or by any discussions or negotiations relating to this Settlement Agreement.
41. The parties will keep the terms of this Settlement Agreement confidential until the Settlement Hearing, except as is necessary to make submissions at the Settlement Hearing. If, for whatever reason, the Tribunal does not approve the Settlement Agreement, the terms of the Settlement Agreement shall remain confidential indefinitely, unless the parties otherwise agree in writing or if required by law.
42. This Settlement Agreement may be signed in one or more counterparts which together constitute a binding agreement.
43. A facsimile copy or other electronic copy of any signature will be as effective as an original signature.
DATED at Toronto, Ontario this 6th day of April, 2026.
"Jing Ding" |
"Soshi Sankat" |
________________________________________________________ |
________________________________________________________ |
Witness (print name): Jing Ding |
LIQUIDNET CANADA INC. |
|
|
I have authority to bind the corporation |
|
|
|
Name: Soshi Sankat |
|
Title: Head of Canada |
|
DATED at Toronto, Ontario, this 8th day of April, 2026.
ONTARIO SECURITIES COMMISSION
By: |
"Bonnie Lysyk" |
________________________________________________________ |
|
________________________________________________________ |
|
Name: Bonnie Lysyk |
|
Title: Executive Vice President, Enforcement Division |
BETWEEN:
[Names of Adjudicators comprising the Panel]
File No. [#]
[Date order made]
(Subsection 127(1) and section 127.1 of the Securities Act, RSO 1990, c S.5)
WHEREAS on [date], the Capital Markets Tribunal held a hearing [select option,] to consider the joint request for a settlement hearing filed by the Ontario Securities Commission and LCI for approval of a settlement agreement dated [date] (the Settlement Agreement);
ON READING the joint request for a settlement hearing, the Application for Enforcement Proceeding dated [date], the Settlement Agreement and the written submissions of the Commission, on hearing the submissions of the representatives of the Commission and Liquidnet Canada Inc. (LCI), and on being advised by the Commission that it has received payments from the respondent in the amount of $600,000 (CAD) and $75,000 (CAD);
IT IS ORDERED THAT:
1. the Settlement Agreement is approved;
2. LCI shall pay an administrative penalty of $600,000 (CAD) for failures to comply with Ontario securities law, pursuant to paragraph 9 of subsection 127(1) of the Act;
3. LCI shall submit to a review of its practices and procedures by an independent consultant acceptable to the Commission, at LCI's expense, in accordance with the terms of reference set out in Schedule 1 to Order, pursuant to paragraph 4 of subsection 127(1) of the Act;
4. LCI is reprimanded pursuant to paragraph 6 of subsection 127(1); and
5. LCI shall pay $75,000 (CAD) toward the costs of the Commission's investigation and proceeding, pursuant to section 127.1 of the Act.
___________________________ |
||
[Name of Panel Chair] |
||
___________________________ |
___________________________ |
|
[Name of Adjudicator] |
[Name of Adjudicator] |
1. Liquidnet Canada Inc. (LCI) shall retain an independent consultant acceptable to the Commission to review LCI Fixed Income ATS and LCI Equities ATS' systems (the ATS Systems) and controls around the ATS Systems, including LCI's operations, agreements (including for outsourcing), internal controls, practices, policies, and procedures, relating to confidential treatment of order and trade information to ensure that:
(a) The ATS Systems are not designed to release or make visible marketplace participants' order or trade information to unauthorized persons or companies, including employees of LCI's affiliates, and access to the ATS Systems is appropriately restricted and aligns with each employee's authorized roles and responsibilities;
(b) The safeguards and procedures to protect marketplace participants' order or trade information, including limiting access to order or trade information of marketplace participants to employees of LCI or persons or companies retained by the marketplace to operate the system and implementing standards controlling trading by employees of LCI for their own accounts, are adequate and reasonable;
(c) The oversight procedures to ensure that the safeguards and procedures established under subsection (b) are adequate;
(d) LCI takes appropriate measures to ensure that the service providers, including its affiliates, protect the marketplace participants' proprietary, order, trade, or any other confidential information for the key services and systems that LCI outsources to the service providers;
2. The Consultant shall be appointed promptly following the approval of the Settlement Agreement, but in any event no later than 30 days following the approval, unless the Commission requires further time to approve the proposed Consultant.
3. Within 30 days of the Consultant's appointment, LCI shall require the Consultant to provide a detailed review plan (the "Review Plan") to an Associate Vice President or Senior Vice President in the Trading and Markets Division of the Commission (the "OSC VP"). The Consultant shall implement any changes to the Review Plan required by the OSC VP.
4. LCI shall require the Consultant to deliver to the OSC VP a written report describing the Consultant's findings, LCI management's response to the findings, and recommendations by the Consultant for each finding to ensure that the ATS Systems conform with the obligations set out in paragraph 1 above (the "Report"), within 180 days of the approval by the OSC VP of the Review Plan;
5. Within 6 months of the delivery of the Report to the OSC VP, LCI shall use best efforts to implement any recommendations of the Consultant described in the Report, and the Ultimate Designated Person and the Chief Compliance Officer of LCI shall provide written confirmation to the OSC VP of the implementation efforts of the Consultant's recommendations in the Report (the Confirmation Letter);
6. Within 90 days after the delivery of the Confirmation Letter to the OSC VP, LCI shall cause the Consultant to conduct appropriate testing to determine whether the recommendations in the Report have been fully implemented, and whether any changes resulting from those recommendations are being appropriately followed, administered and enforced by LCI (Final Testing)
7. Within 60 days of completing the testing, the Consultant shall provide a letter (the Attestation Letter) to the OSC VP, expressing his or her conclusions with respect to the Final Testing and:
(a) include a report with the Attestation Letter which provides a detailed description of the testing performed to support the conclusions contained in the Attestation Letter; and
(b) submit such additional reports as may be requested by the OSC VP for the purpose of satisfying the OSC VP that the conclusions expressed in the Attestation Letter described above are valid;
8. If the Commission is not satisfied with the Consultant's recommendations, or with LCI's efforts to implement the recommendations of the Consultant, then after providing the Consultant with a reasonable opportunity to revise its recommendations, or after providing LCI with a reasonable opportunity to comply with the recommendations of the Consultant, if the Consultant or LCI has still not done so, as the case may be, the Commission may bring the matter to the Tribunal for determination of whether a further order under s. 127(1)4 of the Act is warranted.
9. LCI shall provide the Consultant with reasonable access to all of LCI's books and records necessary to complete the Consultant's mandate and will allow the Consultant to meet privately with LCI's officers, directors and employees. LCI shall require its officers, directors and employees to cooperate fully with the Consultant with respect to the Consultant's work and with respect to the implementation of the recommendations in the Report;
10. LCI shall not terminate the Consultant's engagement and retainer without prior written approval by the OSC VP;
11. LCI shall provide the Commission a direction giving consent for unrestricted access and permission for the Commission and the Consultant to communicate with one another regarding the Consultant's work and LCI's progress with respect to the implementation of the recommendations in the Report and/or any other matter relevant to this review; and
12. For greater certainty, the terms of this review do not limit in any respect the authority of the Commission to undertake, as part of its normal course activities, a review of all matters within the scope of this review or any other aspect of LCI's business.
Ontario Securities Commission et al.
BETWEEN:
File No. 2025-5
Adjudicators: |
James Douglas (chair of the panel) |
Sandra Blake |
|
Alan Stewart |
April 17, 2026
WHEREAS on April 17, 2026, the Capital Markets Tribunal held a hearing by videoconference;
ON HEARING the submissions of the representatives for the Ontario Securities Commission and for Jason Cloth, no one appearing on behalf of Creative Wealth Media Finance Corp.;
IT IS ORDERED THAT:
1. by 4:30 p.m. on May 11, 2026, the parties shall provide to the Registrar electronic versions of their book of documents containing the documents that each party intends to rely on or enter as evidence at the merits hearing;
2. notwithstanding rule 29 of the Tribunal's Rules of Procedure, the exhibits to the Commission's affidavit evidence shall be filed in a separate folder and need not be included in bookmarked PDF volumes, and all exhibits shall be identified in the affidavit by their document ID and hyperlinked so that each exhibit can be individually accessed; and
3. the Commission shall test in advance that the formatting of the affidavit makes the exhibits easily accessible by the Tribunal and all parties.
Peter Michael Deeb et al. -- s. 8
BETWEEN:
File No. 2026-10
Adjudicators: |
James Douglas (chair of the panel) |
Judith Robertson |
|
Mary Condon |
April 20, 2026
(Section 8 of the Securities Act, RSO 1990, c S.5)
WHEREAS on April 6, 2026, the Capital Markets Tribunal issued an order dismissing Peter Michael Deeb's motion for a stay of the Final Order and Decision on Sanctions and Costs of the Canadian Investment Regulatory Organization dated February 3, 2026, pending the disposition of Deeb's application for review of that decision and the Liability Decision of CIRO dated April 14, 2025, and ordered that the interim stay granted by the Tribunal on March 9, 2026 (Interim Stay Order), remain in effect for 10 business days following the Tribunal's April 6 order;
AND WHEREAS on April 16, 2026, Deeb requested a further order that the Interim Stay Order remain in effect for an additional 15 business days;
ON READING Deeb's request and correspondence from the parties, and on considering that the representatives for CIRO and the Commission do not oppose the request and consent to the request being heard in writing;
IT IS ORDERED that the Interim Stay Order shall remain in effect until May 11, 2026.
Ontario Securities Commission et al.
BETWEEN:
File No. 2025-7
Adjudicators: |
Andrea Burke |
James G.D. Douglas |
|
Sandra Blake |
April 20, 2026
WHEREAS the merits hearing took place before the Capital Markets Tribunal on March 23, 24, 25, 26, 27, April 7, 8, 9, 10 and 13, 2026, and the Tribunal requested the parties to provide their timing for filing materials and scheduling oral closing submissions for the merits hearing;
ON READING the correspondence from the parties and on being advised that all parties agree to the hearing dates and timeline for materials;
IT IS ORDERED THAT:
1. oral closing submissions in the merits hearing shall commence August 5, 2026, at 10:00 a.m., at the Capital Markets Tribunal located at 20 Queen Street West, 17th Floor, Toronto, Ontario, and continue August 6 and 7 2026, commencing at 10:00 a.m. on each day, or as may be agreed to by the parties and set by the Governance & Tribunal Secretariat; and
2. the schedule for written closing submissions is as follows:
a. by 4:30 p.m. on May 19, 2026, the Ontario Securities Commission shall file and serve written closing submissions;
b. by 4:30 p.m. on June 30, 2026, each of the respondents shall file and serve responding written closing submissions; and
c. by 4:30 p.m. on July 21, 2026, the Ontario Securities Commission shall file and serve reply written closing submissions, if any.
Ontario Securities Commission and Nayeem Alli
BETWEEN:
File No. 2025-26
Adjudicator: |
M. Cecilia Williams |
April 20, 2026
WHEREAS on the Capital Markets Tribunal held a hearing in writing to consider a request by the respondent Nayeem Alli to vary a deadline contained in the Tribunal's order dated March 19, 2026 (March 19 Order) regarding the schedule for the Ontario Securities Commission's motion to strike a portion of Alli's submissions on the basis of settlement privilege (Motion);
ON READING the correspondence of Alli, on his own behalf, and of the representative for the Ontario Securities Commission and on considering that the Commission consents to Alli's request;
IT IS ORDERED THAT:
1. paragraph 2b of the March 19 Order is varied as follows:
a. by 4:30 p.m. on April 22, 2026, Alli shall serve and file his affidavit evidence and written responding submissions on the Motion, if any;
2. paragraph 2c of the March 19 Order is varied as follows:
a. by 4:30 p.m. on May 1, 2026, the Commission shall serve and file its reply affidavit evidence and written reply submissions on the Motion, if any;
3. in the event Alli does not serve and file any affidavit evidence and written responding submissions on the Motion by 4:30 p.m. on April 22, 2026, the Tribunal will proceed to determine the Motion in writing based on the materials that have been filed.
Ontario Securities Commission and Liquidnet Canada Inc. -- ss. 127(1), 127.1
Citation: Ontario Securities Commission v Liquidnet Canada Inc, 2026 ONCMT 19
Date: 2026-04-15
File No. 2026-15
BETWEEN:
(Subsection 127(1) and section 127.1 of the Securities Act, RSO 1990, c S.5)
Adjudicators: |
M. Cecilia Williams (chair of the panel) |
|
Judith Robertson |
||
Cathy Singer |
||
Hearing: |
By videoconference, April 15, 2026 |
|
Appearances: |
Aaron Dantowitz |
For the Ontario Securities Commission |
Arjun Bains |
||
Lawrence Ritchie |
For Liquidnet Canada Inc. |
|
Madeleine Worndl |
||
The following reasons have been prepared for publication, based on the reasons delivered orally at the hearing, as edited and approved by the panel, to provide a public record of the oral reasons.
[1] The Ontario Securities Commission and Liquidnet Canada Inc. are seeking our approval of a settlement they have agreed to in respect of the Commission's allegations that Liquidnet Canada maintained inadequate controls over marketplace participants' confidential order and trade information, contrary to National Instrument 21-101 Marketplace Operation.
[2] We have decided to approve the settlement agreement and will order the sanctions that the parties have proposed. These are our oral reasons for doing so.
[3] The facts leading to this settlement are set out in detail in the settlement agreement. I will provide a brief summary.
[4] Liquidnet Canada, a registered investment dealer, operates fixed income and equities alternative trading systems. By, at the latest, June 30, 2023, Liquidnet Canada discovered that with respect to its fixed income alternative trading system, certain employees could potentially access confidential order and trade information of clients of Liquidnet US, and that certain employees of Liquidnet Canada affiliates could also access confidential order and trade information of Liquidnet Canada's fixed income marketplace participants. These individuals were not authorized to view that information.
[5] Liquidnet Canada self-identified the issue, voluntarily suspended trading of Canadian debt securities on the fixed income alternative trading system, and on August 30, 2023, filed an incident report with the Commission. However, Liquidnet Canada was not forthcoming in its incident report about the issues behind the shut down, describing them as "systems enhancements".
[6] Throughout September and October 2023, the Commission and Liquidnet Canada exchanged correspondence regarding the suspension of trading on Liquidnet Canada's fixed income alternative trading system. However, it was not until a quarterly meeting with the Commission on November 1, 2023, that Liquidnet Canada advised that the suspension was related to the potential unauthorized access to confidential information.
[7] By October 2024, Liquidnet Canada realized there was also unauthorized visibility of marketplace participants' information on the Liquidnet Canada equity alternative trading system which Liquidnet Canada promptly reported to the Commission.
[8] Liquidnet Canada admits that it acted contrary to subsections 5.10(1), (2), and (3) of National Instrument 21-101 by:
a. releasing a marketplace participant's order or trade information to a person or company, other than a marketplace participant, a securities regulatory authority or a regulation services provider;
b. failing to implement reasonable safeguards and procedures to protect marketplace participants' order or trade information; and
c. failing to implement adequate oversight procedures to ensure that the safeguards and procedures established are followed.
[9] Liquidnet Canada has agreed to pay an administrative monetary penalty of $600,000, costs of the Commission's investigation and proceeding in the amount of $75,000, receive a reprimand and submit to an external review of its practices and procedures by an independent consultant.
[10] Our role at today's hearing is to decide whether the terms of the settlement fall within a reasonable range of outcomes. Before today's hearing, we held a confidential conference with the parties. We had the opportunity to hear from the parties and to ask them questions about the settlement. In deciding whether to approve the settlement, we respect the negotiation process and accord significant deference to the resolution reached by the parties.
[11] We conclude that the sanctions proposed by the parties are within a reasonable range and are therefore in the public interest. In coming to that conclusion, we rely on the following sanctioning factors.
[12] The conduct in question is serious. Allowing access to confidential market participant order or trade information undermines investor confidence and the fairness and efficiency of our markets. Failure to maintain a robust compliance system, particularly with respect to operating a shared technology platform across multiple jurisdictions raises the concern that all relevant risks are not effectively managed. While not the most egregious kind of misconduct that has come before the Tribunal, failure to comply with these essential obligations of operating a marketplace is very serious misconduct.
[13] Liquidnet Canada's initial failure to promptly advise the Commission about the unauthorized disclosure of confidential information in the fixed income trading system is also serious and an aggravating factor. It is essential to the effective regulation of Ontario's capital markets that marketplaces provide the Commission with accurate information when suspending trading or responding to Commission inquiries.
[14] Liquidnet Canada is an experienced market participant, which might be considered an aggravating factor, however it has not previously been the subject of enforcement action by the Commission.
[15] The mitigating factors relevant to Liquidnet Canada's circumstances are that:
a. it has co-operated with the Commission's investigation; and
b. by entering the settlement, it has taken accountability for its compliance failures and is conserving Commission and Tribunal resources.
[16] Other settlement decisions are not determinative but do provide helpful guidelines. In terms of the reasonableness of the $600,000 administrative penalty the parties have agreed to, they referred us to Omega Securities Inc (Re),{1} a settlement approved by the Tribunal in 2018. In that instance, Omega Securities Inc., the operator of two alternative trading systems, agreed that certain information discrepancies identified by the Commission amounted to a failure to comply with National Instrument 21-101. The sanctions agreed to in that settlement included an administrative penalty of $500,000.
[17] We find that the sanctions against Liquidnet Canada are proportionate to its misconduct and meet the objectives of specific and general deterrence. The administrative penalty, external review and reprimand impress upon Liquidnet Canada and other marketplaces the seriousness of their compliance obligations under the National Instrument, in particular with respect to the confidentiality of market participants' order and trade information. In addition, it reinforces the importance of being timely and forthright when reporting compliance issues to the Commission.
[18] In conclusion, we find that the settlement is reasonable and in the public interest. We will issue an order substantially in the form of the draft attached to the settlement agreement.
[19] The terms of the settlement agreement include a reprimand of Liquidnet Canada. To the representative of Liquidnet Canada who is here today your presence allows the Panel to convey to Liquidnet Canada the importance of these matters and our formal disapproval of Liquidnet Canada's conduct, which fell well short of its regulatory obligations. We trust that Liquidnet Canada, through its directors, officers, and employees, accepts the reprimand, and will continue to make comprehensive, effective and sustained efforts to avoid a recurrence.
Dated at Toronto this 15th day of April, 2026
{1} 2018 ONSEC 48
Notice of Agreement to Facilitate the Initial Cross-listing of Securities in France and Canada
April 23, 2026
The Ontario Securities Commission (OSC) and the Autorité des marchés financiers of Québec (AMF Quebec -- collectively,the Canadian Authorities) have entered into an agreement (Agreement) with the Autorité des marchés financiers of France (AMF France) to facilitate the initial cross-listing of securities in France and Canada.
The purpose of the Agreement is to promote the initial cross-listing of securities on an exchange, by way of prospectus, in Canada and France by establishing a new collaborative procedure that will facilitate dialogue and information sharing between securities regulators in the two countries.
The Agreement does not provide regulatory relief and Canadian and French companies seeking to cross-list their securities in France and Canada by way of a prospectus must still comply with the regulatory requirements of both countries and applicable exchange requirements.
The Agreement came into effect on April 16, 2026
Contact Information
Questions may be referred to:
Desiring to reaffirm their commitment to a close constructive regulatory and supervisory relationship,
Recognizing the increasing international activity in the financial markets, and the corresponding need for cooperation between securities regulatory authorities, and
Based on their common understanding of their regulatory and supervisory frameworks concerning the Cross-Listing of certain securities on a Regulated Market in France or on Recognized Exchanges in Canada,
The AMF France and the Canadian Authorities agree to facilitate the filing of a Prospectus relating to a Dual Listing or Subsequent Listing of Canadian and French Issuers
The AMF France and the Canadian Authorities express their willingness to cooperate in the interest of fulfilling their respective regulatory and supervisory mandates, particularly with the aim of fostering capital formation, protecting investors and ensuring the proper functioning of financial markets.
Definitions
For the purpose of this Agreement :
"Approval" means the process of approving a Prospectus for the first application for admission to trading, with or without offer to the public or for the purposes of becoming a Reporting Issuer in the case of Canada, in connection with a listing of securities on a Regulated Market in France or Recognized Exchange in Canada, as applicable.
"Authority" means Autorité des marchés financiers (France) ("AMF France") or, the Autorité des marchés financiers (Québec) ("AMF Québec"), the Ontario Securities Commission ("OSC"), or any other Canadian Authority (and, collectively, "the Authorities").
"Canadian Authority" means a securities regulatory authority established in Canada under provincial or territorial statute that is a signatory to this Agreement.
"Canadian Issuer" means any company, partnership, limited partnership or trust (i) existing under the laws of Canada or any province thereof, (ii) with its head office in Canada, (iii) with principal operations, or any other material property or other material assets, located in Canada, or (iv) with the majority of its executive officers, directors, partners or trustees ordinarily residing in Canada.
"Confidential Information" means any non-public information exchanged between two Authorities pursuant to this Agreement.
"Continuous disclosure obligations" means periodic and permanent transparency obligations or continuous disclosure obligations as applicable in the jurisdiction of an Authority.
"Cross-List" or "Cross-Listed" or "Cross-Listing" means either Dual Listing or Subsequent Listing.
"Dual Listing" refers to the process whereby an Issuer is seeking a first admission, with or without an offer to the public, simultaneously on a Regulated Market in France and a Recognized Exchange in Canada and files a Prospectus in connection with such dual listing.
"EEA" means European Economic Area.
"European law" means the law of the European Union.
"EU Prospectus Regulation" means Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a Regulated Market, and repealing Directive 2003/71/EC.
"French Issuer" means any issuer as defined in article 2 (h) of the EU Prospectus Regulation (UE) 2017/1129 and which is a company incorporated in France.
"Home Authority" means :
a) for a Canadian Issuer, the Authority that is the Principal Regulator; and
b) for a French Issuer, the AMF France.
"Host Authority" means :
a) Where the Home Authority is the AMF France, any Canadian Authority that is the Principal Regulator in charge of approving a Prospectus submitted to it by a French Issuer; and
b) Where the Home Authority is a Canadian Authority, the AMF France.
"Home Exchange" means a Regulated Market in France for a French Issuer, or the applicable Recognized Exchange in Canada for a Canadian Issuer.
"Host Exchange" means a Regulated Market in France for a Canadian Issuer, or the applicable Recognized Exchange in Canada for a French Issuer.
"IOSCO MMoU" means the multilateral memorandum of understanding (MMoU) concerning consultation and cooperation and the exchange of information established by the International Organization of Securities Commissions (IOSCO) to which the AMF France and the Canadian Authorities are signatories.
"Issuer" means either a Canadian Issuer or a French Issuer.
"Prospectus" means a document containing all the information required under the Regulations, in the case of France, concerning an admission to trading on a Regulated Market in France or an offer to the public and, in the case of Canada, concerning an application to become a Reporting Issuer or a distribution of securities to the public.
"Principal Regulator" means the Canadian Authority determined in accordance with National Policy 11-202 Process for Prospectus Reviews in Multiple Jurisdictions
"Recognized Exchange" means an exchange recognized by a securities regulatory authority in Canada.
"Regulated Market" means a regulated market as defined in Article 2(b) of the EU Prospectus Regulation (UE) 2017/1129.
"Regulations" means any law, regulation, or regulatory requirement applicable in the jurisdiction of an Authority.
"Reporting Issuer" has the same meaning as in applicable Canadian provincial and territorial securities legislation.
"Requesting Authority" means an Authority making a request under this Agreement.
"Requested Authority" means :
a) Where the Requesting Authority is the AMF France, the Canadian Authority to which a request is made under this Agreement; or
b) Where the Requesting Authority is a Canadian Authority, the AMF France.
"Subsequent Listing" refers to the process whereby a Canadian Issuer which is already listed on a Recognized Exchange in Canada is seeking a first admission on a Regulated Market in France or a French Issuer which is already listed on a Regulated Market in France is seeking a first admission on a Recognized Exchange in Canada, with or without an offer to the public, and files a Prospectus in connection with such subsequent listing.
1. This Agreement is established by the AMF France and by the Canadian Authorities to facilitate the Cross-Listing of securities of Canadian and French Issuers on a Regulated Market in France or Recognized Exchange in Canada of their respective jurisdictions in a manner consistent with the Regulations.
2. Bilateral cooperation will be most useful and needed in the circumstances of Dual Listings and Subsequent Listings.
3. The Authorities intend to cooperate with the aim of providing the necessary support to Issuers in meeting the Regulations in each other's jurisdictions as may be required to facilitate the Cross-Listing in connection with the filing of a Prospectus.
4. This Agreement does not purport to be an assessment of (i) the equivalence with European law of the Canadian Regulations nor (ii) the equivalence with Canadian Regulations of European law, applying to the content or scrutiny of the Prospectus to be published.
5. In the case of the Cross-Listing in France of a Canadian Issuer, this Agreement is intended to apply only in the case where such an Issuer draws up a Prospectus under Article 28 of the EU Prospectus Regulation.
6. In the case of the Cross-Listing in Canada of a French Issuer, this Agreement is intended to apply only in the case where a French Issuer draws up a Prospectus pursuant to the Regulations.
7. This Agreement does not fall within the scope of Articles 29 and 30 of the EU Prospectus Regulation.
8. Canadian Issuers seeking a Cross-Listing in France should be aware that admission to trading of securities on a Regulated Market in France entails specific periodic and permanent transparency obligations once the securities are admitted to trading.
9. French Issuers seeking a Cross-Listing in Canada should be aware that certain continuous disclosure obligations apply once an issuer obtains a receipt for a Prospectus, which may occur before an Issuer receives approval to be listed on a Recognized Exchange in Canada.
10. The Authorities acknowledge that Issuers seeking to Cross-List will be required to separately apply to a Regulated Market in France and/or a Recognized Exchange in Canada to obtain a listing. The Regulated Market in France and/or Recognized Exchange in Canada will be responsible for making the listing decision and may impose additional disclosure requirements.
11. The provisions of this Agreement should not be construed as permitting an Issuer to derogate from any Regulation applying to the listing of its securities on a Regulated Market in France or a Recognized Exchange in Canada.
12. This Agreement neither creates any enforceable rights or binding legal obligations for the signatory Authorities or any third party, nor fetters the discretion of the Authorities in any way in the discharge of their functions.
13. The Authorities will make reasonable efforts to meet the terms of this Agreement.
14. This Agreement is a bilateral initiative between each participating Canadian Authority and the AMF France and should not be considered an initiative between any Canadian Authority.
15. Within the framework of this Agreement, each Authority will remain responsible for regulating and supervising the Prospectuses for admission to trading in France or for becoming a Reporting Issuer in Canada, with or without offer to the public.
16. This Agreement does not:
(a) modify or supersede any Regulations in force in the jurisdictions of, or applying to, the Authorities;
(b) affect any right of any Authority under its Regulations to take measures to assess or ensure compliance with, or to enforce, the Regulations of the Authority. In particular, this Agreement does not affect any right of either Authority to communicate with or obtain information or documents from any other person or entity on a voluntary basis in the jurisdiction of the other Authority when the applicable legislation allows it and provided that any existing procedures or protocols for the obtaining of such information or documents are observed; or
(c) give rise, directly or indirectly, on the part of any person other than the Authorities to the right to obtain, suppress or exclude any information or to challenge the execution of a request for assistance under this Agreement.
17. In addition, this Agreement does not affect existing arrangements concerning cooperation in securities matters including:
(a) the IOSCO MMoU, which covers mutual assistance and the exchange of information for the purpose of enforcing and securing compliance with the Laws and Regulations (as defined in the IOSCO MMoU) of the jurisdictions of the Authorities, including assistance in the context of enforcement investigations, and
(b) any relevant arrangements between the Authorities.
18. In the event of any inconsistency between this Agreement and the provisions of the IOSCO MMoU, of which the Authorities are signatories, the provisions of the IOSCO MMoU shall prevail.
19. The Authorities acknowledge that transfer of personal data will take place in accordance with the Regulations and the conditions laid down in the IOSCO Administrative Arrangement on the transfer of personal data between EEA Authorities and Non-EEA Authorities to which the Authorities are signatories.
1. The Agreement will be applicable to equity securities as defined in Article 2(b) of the EU Prospectus Regulation.
2. Pursuant to the arrangement described in this Agreement, it is expected that Issuers seeking a Cross-Listing should submit to the Host Authority a Prospectus for admission to trading of either its shares or depository shares evidenced by depositary receipts.
3. The Authorities agree to review periodically the functioning and effectiveness of the arrangement described in this Agreement with a view to expanding or altering its scope or operation, if deemed necessary.
1. Where an Issuer wishes to proceed with a Cross-Listing, in order to benefit from the arrangement described in this Agreement, it will inform its Home Authority of its intention to seek a Cross-Listing in advance of submitting a draft or preliminary Prospectus to the Host Authority.
2. Where the AMF France is the Home Authority, the AMF France will make reasonable efforts to inform the Host Authority of the following, where available, after receiving a notification under section 1:
(a) of any public incrimination and/or sanction involving the Issuer or the members of its administrative, management or supervisory bodies, by statutory or regulatory authorities (including designated professional bodies),
(b) of any disqualification by a court of the aforementioned persons from acting as a member of the administrative, management or supervisory bodies of the Issuer, or from acting in the management or conduct of the affairs of the Issuer, and
(c) of any bankruptcies, receiverships, liquidations or companies put into administration in respect of members of its administrative, management or supervisory bodies.
provided such incrimination, sanction or disqualification has occurred in the three years preceding the notification received under section 1.
3. Where a Canadian Authority is the Home Authority, the Canadian Authority will make reasonable efforts, to inform the Host Authority of the following, where available, after receiving a notification under section 1:
(a) the Issuer's previous or proposed disclosure of director and executive officer cease trade orders, bankruptcies, penalties or sanctions as required by Item 16.2 of Form 41-101F1 Information Required in a Prospectus (41-101F1) or Item 10.2 of Form 51-102F2 Annual Information Form (51-102F2), and
(b) the Issuer's previous or proposed disclosure of regulatory action taken against the Issuer as required by Item 23.2 of 41-101F1 or Item 12.2 of 51-102F2.
4. Following a notification received under section 1, the Home Authority will draw the attention of the Issuer to the language rules and filing procedures applying to the Prospectus to be submitted to the Host Authority, in accordance with applicable Regulations.
5. The Home Authority will encourage the Issuer to file with the Host Authority all documents required under the Regulations of the Host Authority to comply with its continuous disclosure obligations resulting from the contemplated Cross-Listing.
6. The Home Authority will encourage the Issuer, to the extent permitted by law, to ensure that at least all regulated information relating to itself and its securities, filed or approved by the Home Authority over the past 1 year, is made easily accessible to the investors in the Host jurisdiction in a language accepted by the Host Authority.
1. Within the framework of this Agreement, the Authorities will endeavour to provide each other with the fullest cooperation in relation with Issuers wishing to Cross-List their securities.
2. The Authorities will rely on each other to share their prior supervisory experience with Issuers seeking to Cross-List their securities, insofar as such experience will be deemed relevant in facilitating the swift review and approval of draft Prospectuses and, where relevant, the supervision of the offer to the public taking place during the Cross-Listing.
3. Furthermore, the Authorities will endeavour to inform each other to the extent possible and as soon as practicable about:
(a) any undisclosed material change known to an Authority that is reasonably expected to have a significant impact on the share price of Issuers which are seeking to Cross-List, or which have Cross-Listed their securities, within the framework of this Agreement, and
(b) enforcement actions taken by them in respect of such Issuers, which, in their reasonable opinion, may have a material impact on the share price of these Issuers.
4. To the extent permitted by domestic laws and practices, national or public interests, each Authority will use reasonable efforts to provide the other Authority (i) with any information relating to Issuers which are seeking to Cross-List, or have Cross-Listed their securities, within the framework of this Agreement, concerning a breach, or possible breach by such Issuers of the Regulations of the Authority, and (ii) with any information which may assist the other Authority to perform a function or exercise a power under the Regulations of its jurisdiction.
1. The Authorities will provide Canadian or French Issuers wishing to Cross-List their securities, with the same level of support that they otherwise provide to issuers established in their own jurisdiction.
2. The Host Authority will endeavour to provide Issuers seeking a Cross-Listing general guidance regarding the Regulations applicable to the admission to trading of their securities. For clarity, the Host Authority will not provide legal advice to Issuers seeking to Cross-List.
3. The Host Authority will offer each Issuer seeking a Cross-Listing a support consisting of a dedicated team and/or contact person in charge of dealing with the Issuer's application for approval of its draft or preliminary Prospectus. Such dedicated team or contact person will provide the Issuer with appropriate assistance during the prospectus review phase.
4. The Home Authority will encourage Issuers wishing to Cross-List to conduct sufficient background research on applicable Regulations in the host jurisdiction and to obtain local legal counsel for representation in the process.
5. The Authorities will encourage Issuers to consult their respective websites early for any clarification or guidance as to how the relevant requirements may apply or be complied with in light of their specific circumstances.
6. The Authorities acknowledge that when a Host Authority provides assistance to an Issuer from the other jurisdiction, the Host Authority is not expressing an opinion about whether the Issuer from the other jurisdictions will ultimately meet the requirements for Approval in its jurisdiction.
1. The Authorities recognize the importance of regulatory convergence and close communication, and wish to strengthen cooperation and collaboration in that objective. They intend to consult regularly and exchange information on the evolutions of the regulatory environment in their respective country and region, and to share experience and expertise in order to reach better understanding in the area of Cross-Listing of securities.
2. The Authorities anticipate that cooperation will be primarily achieved through ongoing, informal consultations, supplemented, when necessary, by more in-depth cooperation, including through mutual assistance and information-gathering and sharing. The provisions of this Agreement are intended to facilitate more formal processes such as the written exchange of non-public information where necessary.
3. The Authorities agree to establish such arrangements as appropriate to facilitate further cooperation in relation to the matters mentioned in this Agreement and explore ways to enhance this cooperation with a view to facilitating the Cross-Listing of securities between France and Canada.
1. Subject to sections 2, 5 and 6 of Article 7, each Authority will keep confidential, to the extent permitted by law, Confidential Information shared between the Authorities under this Agreement.
2. As required or authorized by law, it may become necessary for a Requesting Authority to share Confidential Information obtained under this Agreement with a governmental entity in its jurisdiction. In such circumstances and to the extent permitted by the Regulations:
(a) The Requesting Authority will notify the Requested Authority; and
(b) Prior to the Requesting Authority sharing the Confidential Information, the Requesting Authority will provide adequate assurances to the Requested Authority concerning the governmental entity's use and confidential treatment of the Confidential Information, including, as necessary, assurances that:
i. The governmental entity has confirmed that it requires the Confidential Information for a purpose within the scope of its jurisdiction; and
ii. The Confidential Information will not be shared by the governmental entity with other parties unless:
1. The governmental entity is required to do so by law; and
2. The Requested Authority has provided prior written consent.
3. The Authorities agree to use Confidential Information disclosed to it by the other Authority only for the purposes for which the Confidential lnformation was disclosed.
4. However, the Authorities recognize that, while this Agreement is not intended to gather information for enforcement purposes, they may subsequently want to use the Confidential Information provided pursuant to this Agreement for enforcement purposes. In such cases, the Authorities will inform each other of such intended use and proceed along with the principles of the IOSCO MMoU. In particular, should an Authority wish to use for enforcement purposes information it has obtained directly from a person or an entity within the framework of this Agreement, it should inform the other Authority and submit a request for assistance in accordance with the terms of the IOSCO MMoU.
5. Subject to section 2 of Article 7, if an Authority intends to use or disclose to any third party any Confidential Information provided to it under this Agreement by the other Authority for purposes other than those for which such Confidential Information was provided, the Authority should seek prior written consent from the other Authority, which provided the information. If consent is not obtained from the Requested Authority, the Authorities will consult to discuss the reasons for withholding approval, and the circumstances, if any, under which the intended use by the Requesting Authority might be allowed.
6. Where Confidential Information received from an Authority under this Agreement is subject to a legally enforceable demand for onward disclosure in the Requesting Authority's jurisdiction, the latter will, to the extent permitted by law, notify the Requested Authority prior to complying with such a demand and will assert such appropriate legal exemptions or privileges with respect to such information as may be available. The Requesting Authority will use its best efforts to protect the confidentiality of non-public documents and information received under this Agreement.
7. This Agreement complies with the cooperation agreement requirement of Article L632-7 as well as with the reciprocity and professional secrecy requirements of Article L. 632-17 of the French Monetary Code.
8. All Confidential Information and personal data communicated must be protected by professional secrecy. All employees of the signatory Authorities who deal with this information or personal data in the course of their duties acknowledge that they are bound by an obligation of confidentiality.
1. To facilitate the support to Issuers, each Authority will establish a dedicated email address.
2. To facilitate co-operation under this Agreement, each Authority will designate a contact point as specified in Appendix A.
1. This Agreement takes effect from the date of execution for all parties, or on the date determined in accordance with each Authority's applicable legislation.
2. This Agreement may be amended in writing if all Authorities agree in writing to do so.
3. Cooperation under this Agreement may be discontinued by any Authority upon providing 30 days' written notice to the other Authorities of its intention to withdraw. Upon such notice, the Authorities will consult to determine the appropriate handling of any outstanding matters. If consensus cannot be reached, cooperation will continue with respect to all requests made prior to the expiration of the 30-day notice period until those requests are either fulfilled or formally withdrawn.
4. ln the event of termination, Confidential Information obtained under this Agreement shall continue to be treated in accordance with Article 7.
The Authorities acknowledge that this Agreement has been entered into in both an English language version and a French language version, each text being of equal value. In case of any divergence of interpretation between the English and French language versions of this Agreement, the Authorities agree that the English language version will prevail.
Any securities regulatory authority established in Canada under provincial or territorial statute may become a party to this Agreement by executing a counterpart hereof together with the AMF France and providing notice to the other signatories which are parties to this Agreement, pursuant to which their contact details shall be added to Appendix A.
Date and Signing |
|
|
|
For the Autorité des marchés financiers -- France |
For the Autorité des marchés financiers -- Québec |
|
|
Marie-Anne BARBAT-LAYANI |
Yves OUELLET |
Chair |
President and CEO |
|
|
Date: Signed on April 16, 2026 |
Date: Signed on April 16, 2026 |
|
|
For the Ontario Securities Commission |
|
|
|
D. Grant VINGOE |
|
Chief Executive Officer |
|
|
|
Date: Signed on April 16, 2026 |
|
For the AMF France
For the AMF Québec
For the Ontario Securities Commission
CSA Notice of Amendments to National Instrument 23-101 Trading Rules and Changes to Companion Policy 23-101 Trading Rules
April 23, 2026
The Canadian Securities Administrators (the CSA orwe) are publishing in final form amendments to National Instrument 23-101 Trading Rules (NI 23-101) (the Amendments) and accompanying changes to Companion Policy to NI 23-101 Trading Rules (NI 23-101CP) (theCP Changes).
The Amendments and CP Changes modify section 6.6.1 of NI 23-101 to lower the active trading fee cap{1} applicable to trades in securities that are listed on both a Canadian recognized exchange and a U.S. registered national securities exchange (U.S. Inter-listed Securities) and make related changes to NI 23-101CP.
We are publishing clean and blacklined versions of the text of the Amendments and CP Changes in Annexes A through D to this notice, together with summary of comments at Annex E. The text of the Amendments and CP Changes will also be available on the websites of the CSA jurisdictions, including:
Provided all necessary ministerial approvals are obtained, the Amendments will come into force on, and the CP Changes will take effect on November 2, 2026.
In a related initiative, the Canadian Investment Regulatory Organization (CIRO) published an approval to amend subsection 6.1(1) of the Universal Market Integrity Rules to align Canadian trading increments for certain U.S. Inter-listed Securities with the equivalent minimum pricing increment for these securities in the U.S.{2}
The Amendments and CP Changes lower the maximum fee for executing an order involving a U.S. Inter-listed Security priced at CAD $1.00 or more. The Amendments amend section 6.6.1 of NI 23-101 to cap active trading fees for U.S. Inter-listed Securities at CAD $0.0017 per share if the execution price of the security is greater than or equal to $1.00. Following this change, all equities priced at CAD $1.00 or more will have an active trading fee cap of CAD $0.0017. We will monitor the impact of the change in the fee cap over time and assess if further changes to the fee cap are required. Any further changes will be subject to public consultation.
Following a review by the CSA and CIRO of the U.S. Securities and Exchange Commission (SEC) amendments to establish a variable (and in many cases smaller) minimum trading increment for securities (SEC Tick Size Rule) and, in conjunction, reduce the trading fee caps charged in the U.S. (SEC Trading Fee Rule), the CSA published proposed amendments to NI 23-101 and changes to NI 23-101CP on January 23, 2025 (the Request for Comment) to reduce trading fee cap for U.S. Inter-listed Securities to CAD $0.0010 for securities inter-listed on a U.S. registered national securities exchange priced at or above CAD $1.00.{3} The trading fee cap proposed in the Request for Comment matched the SEC trading fee cap of USD $0.0010 without consideration of foreign exchange rates. After considering the comments received in response to the publication, we have made non-material changes to certain aspects of the proposals. For additional background on the substance and purpose of the Amendments and CP Changes, please refer to the Request for Comment.
The SEC Tick Size Rule and SEC Trading Fee Rule were originally to come into effect on November 3, 2025 but implementation was paused pending the outcome of litigation challenging the rules. They will now be implemented on November 2, 2026{4}, which is the date on which the Amendments will come into force and CP Changes will take effect.
In response to the Request for Comment, we received 10 responses. We have considered the comments received and thank all the commenters for their input. A list of those who submitted comments, a summary of the comments and our responses are attached at Annex E to this notice. Copies of the comment letters are available at www.osc.ca and www.lautorite.qc.ca.
As noted above, the Request for Comment initially proposed lowering the trading fee cap for U.S. Inter-listed Securities to CAD $0.0010 per share if the execution price of the security is greater than or equal to $1.00, which aligns with the SEC Trading Fee Rule at USD $0.0010 per share. The rationale for the cap was to prevent order flow in Canadian securities migrating to U.S. marketplaces to avoid higher Canadian trading fees and to prevent potential share price distortions that may result from the combination of reduced minimum trading increments and high trading fees. However, there was little consensus among commenters on whether a trading fee cap of $0.0010 per share or alternative fee caps were more appropriate or would be effective in keeping order flow in Canada. Some commenters supported a trading fee cap of $0.0010, while the others supported trading fee caps ranging from $0.0017 to $0.0030 per share, while some supported removing the fee cap entirely. In particular, some commenters warned that a $0.0010 cap would make it more difficult for Canadian marketplaces to compete for order flow by offering higher rebates.
Adopting a $0.0017 trading fee cap for U.S. Inter-listed Securities lowers the trading fee cap from the existing $0.0030 per share while better approximating the Canadian dollar equivalent of the U.S. fee cap of USD $0.0010 (which is approximately CAD $0.0014 at current exchange rates), reflecting the current foreign exchange rate and providing marketplaces greater flexibility in setting their respective fee schedules. Additionally, a CAD $0.0017 trading fee cap for U.S. Inter-listed Securities creates a more simplified fee cap regime as that fee cap aligns with the cap for non-U.S. Inter-listed Securities.
The change from a $0.0010 to a $0.0017 fee cap is appropriate because:
• the higher fee cap gives marketplaces greater flexibility in setting trading fees,
• it does not result in a fee cap that is materially higher than the U.S. cap taking into account foreign exchange rates and is thus consistent with the rationale for lowering the fee cap for inter-listed securities, and
• the Request for Comment specifically asked whether a $0.0017 fee cap was more appropriate than the proposed $0.0010 fee cap and, as evidenced in Annex E, there was some support for a $0.0017 fee cap.
• Annex A -- Amendments to National Instrument 23-101 Trading Rules
• Annex B -- Changes to Companion Policy 23-101 Trading Rules
• Annex C -- Blackline Showing Amendments to National Instrument 23-101 Trading Rules
• Annex D -- Blackline Showing Changes to Companion Policy 23-101 Trading Rules
• Annex E -- Summary of Comments and CSA Responses
• Annex F -- Local Matters
Please refer your questions to any of the following:
Mark Delloro |
Serge Boisvert |
Senior Accountant, Trading & Markets |
Senior Policy Coordinator |
Ontario Securities Commission |
Direction de l'encadrement des marchés et des dérivés et des affaires internationales Autorité des marchés financiers |
mdelloro@osc.ca |
serge.boisvert@lautorite.qc.ca |
|
|
Tim Baikie |
Kim Legendre |
Senior Legal Counsel, Trading & Markets |
SRO Analyst |
Ontario Securities Commission |
Direction de l'encadrement des marchés et des dérivés et des affaires internationales Autorité des marchés financiers |
tbaikie@osc.ca |
kim.legendre@lautorite.qc.ca |
|
|
Alex Petro |
Jesse Ahlan |
Trading Specialist, Trading & Markets |
Senior Regulatory Analyst, Market Structure |
Ontario Securities Commission |
Alberta Securities Commission |
apetro@osc.ca |
jesse.ahlan@asc.ca |
|
|
Xavier Boulet |
Navdeep Gill |
Senior Policy Coordinator |
Senior Legal Counsel |
Direction de l'encadrement des marchés et des dérivés et des affaires internationalesAutorité des marchés financiers |
British Columbia Securities Commission |
xavier.boulet@lautorite.qc.ca |
NGill@bcsc.bc.ca |
1. National Instrument 23-101 Trading Rules is amended by this Instrument.
2. Section 6.6.1 is amended in subsection (2) by replacing paragraphs (a) and (b) with the following:
(a) is greater than $0.0017 per security traded for an equity security, or per unit traded for an exchange-traded fund, if the execution price of each security or unit traded is greater than or equal to $1.00, and
(b) is greater than $0.0004 per security traded for an equity security, or per unit traded for an exchange-traded fund, if the execution price of each security or unit traded is less than $1.00.
3. Section 6.6.2 is repealed.
4.This Instrument comes into force on November 2, 2026.
1. Companion Policy 23-101 to National Instrument 23-101 Trading Rules is changed by this Document.
2. Section 6.4.1 is deleted.
3. This change becomes effective on November 2, 2026.
Trading Fees
6.6.1 (1) In this section
"exchange-traded fund" means a mutual fund
a. the units of which are listed securities or quoted securities, and
b. that is in continuous distribution in accordance with applicable securities legislation; and
"inter-listed security" means an exchange-traded security that is also listed on an exchange that is registered as a "national securities exchange" in the United States of America under section 6 of the 1934 Act.
(2) A marketplace that is subject to section 7.1 of NI 21-101 must not charge a fee for executing an order that was entered to execute against a displayed order on the marketplace that,
a.
in the case of an order involving an inter-listed security,i.
is greater than $0.0030 per security traded for an equity security, or per unit traded for an exchange-traded fund, if the execution price of each security or unit traded is greater than or equal to $1.00, andii.
is greater than $0.0004 per security traded for an equity security, or per unit traded for an exchange-traded fund, if the execution price of each security or unit traded is less than $1.00; orb.
in the case of an order involving a security that is not an inter-listed security,i.
is greater than $0.0017 per security traded for an equity security, or per unit traded for an exchange-traded fund, if the execution price of each security or unit traded is greater than or equal to $1.00, andii.
is greater than $0.0004 per security traded for an equity security, or per unit traded for an exchange-traded fund, if the execution price of each security or unit traded is less than $1.00.(a) is greater than $0.0017 per security traded for an equity security, or per unit traded for an exchange-traded fund, if the execution price of each security or unit traded is greater than or equal to $1.00, and
(b) is greater than $0.0004 per security traded for an equity security, or per unit traded for an exchange-traded fund, if the execution price of each security or unit traded is less than $1.00.
(3) A recognized exchange must maintain a list of inter-listed securities that are listed on the exchange as of the last day of each calendar quarter.
(4) A recognized exchange must publicly disclose on its website the list referred to in subsection (3)
a. within 7 days after the last day of each calendar quarter, and
b. for a period of at least 12 months commencing on the date it is publicly disclosed on the website.
Ceasing to be inter-listed security -- fee transition period
6.6.2 If a security ceases to be an inter-listed security, paragraph 6.6.1(2)(b) does not apply if
a.
less than 35 days has passed since the first date, following the cessation, the list referred to in subsection 6.6.1(4) was publicly disclosed, andb.
the fee charged is in compliance with paragraph 6.6.1(2)(a) as if the security were still an inter-listed security.
6.4.1 Trading Fees -- Section 6.6.1 provides caps on the fee that a marketplace subject to section 7.1 of NI 21-101 can charge for execution against a displayed order on the marketplace. Paragraph 6.6.1(2)(a) establishes a higher trading fee cap for exchange-traded securities that are inter-listed (i.e., listed on both a recognized exchange and a national securities exchange in the United States of America) and priced at or above $1.00. Subsections 6.6.1 (3) and (4) provide a process to ensure transparency of a security's status as an inter-listed security, and require a recognized exchange to publish a quarterly list of all of its inter-listed securities no later than seven days after the end of each quarter. In compiling the list, an exchange may rely on representations made by its listed issuers as to their status. Section 6.6.2 addresses the situation where a security's status as an inter-listed security changes, specifically, when a security is delisted from all U.S. national securities exchanges on which it was listed and is now only listed on a recognized exchange in Canada and is no longer an inter-listed security. Section 6.6.2 requires marketplaces to make any reductions to their fees that are necessary to comply with paragraph 6.6.1(2)(b) no later than 35 days following the publication of the first list indicating that the security is no longer an inter-listed security.
List of Commenters
1. BMO Capital Markets
2. Canadian Independent Finance and Innovation Counsel Inc.
3. Investment Industry Association of Canada
4. Nasdaq Canada
5. National Bank Financial Inc.
6. Scotiabank
7. TD Securities
8. TMX Group Limited
9. Tradelogiq Markets Inc.
10. Virtu Financial
Question 1:
a) Do you agree with the proposal to align the maximum fee for executing an order involving a U.S. Inter-listed Security priced at CAD 1.00 or more with the reduced access fee cap adopted by the SEC:
i) at CAD 0.0010, without consideration for the current foreign exchange rate, or
ii) at CAD 0.0014, which approximates the SEC's adopted access fee cap with consideration for the foreign exchange rate (USD 0.0010 x 1.44)?{5}
b) Alternatively, do you support aligning the access fee cap for U.S. Inter-listed Securities with the current fee cap for non-U.S. Inter-listed securities (CAD 0.0017)?
c) Do you support any alternatives not listed above?
Please provide rationale in support of or against any alternatives above.
Summary of Comments |
CSA Response |
|
|
• Five commentors supported a CAD 0.0010 fee cap. |
We have amended NI 23-101 to implement a CAD 0.0017 fee cap. |
|
|
• One commentor supported eliminating the distinction in fee caps between U.S. Inter-listed Securities and non-U.S. Inter-listed Securities. The fee cap for non-U.S. Inter-listed Securities is currently CAD 0.0017. |
|
|
|
• One commentor supported a CAD 0.0025 fee cap. |
|
|
|
• One commentor supported a CAD 0.0030 fee cap, but if they had to choose one of the options listed, they would support a CAD 0.0017 fee cap. |
|
|
|
• Two commentors supported eliminating fee caps in favour of a market-driven fee structure. |
|
Question 2:
Will the competitiveness of the Canadian capital markets be impaired if only the trading fee caps are lowered for U.S. Inter-listed Securities? Please provide supporting rationale.
Summary of Comments |
CSA Response |
|
|
• One commentor believes that any change in trading fee caps will not impact how companies use U.S Inter-listed Securities |
We are monitoring and will continue to monitor how any changes to the trading fee cap impact the competitiveness of the Canadian capital markets. |
|
|
• Two commentors believes that lowering Canadian trading fee caps on U.S. Inter-listed Securities could incentivize Canadian investors and traders to use more U.S. marketplaces where higher rebates can be offered, leading to decreased order flow in Canada |
|
|
|
• Three commentors believe having a harmonized fee cap for all securities in Canada would reduce marketplace fee complexity. There was some disagreement on what that harmonized fee should be -- some commentors supported a CAD 0.0010 fee cap for all securities, whereas others supported a CAD 0.0017 fee cap for all securities |
|
Question 3:
Should the trading fee caps apply to trading fees paid by passive orders in inverted (taker-maker) markets? Please provide supporting rationale. What would be the costs and benefits of applying the cap to inverted markets?
Summary of Comments |
CSA Response |
|
|
• Two commentors supported applying the same trading fee caps paid by passive orders in inverted markets as those in non-inverted markets as externalities and distortions raise overall transactions costs for the market |
The fee cap is intended to apply to orders that a marketplace participant may be required to interact with as a result of the order protection rule. No one is required to post a passive order on an inverted market. |
|
|
• Two commentors said that there should be no regulatory restriction on the level of fees for passive orders or associated rebates for active orders on inverted venues because a natural limit, determined by market forces, already exists. At some point, the liquidity providing fee becomes too expensive for participants to make markets and liquidity providers will stop routing orders to the marketplace. |
|
Question 4:
As part of the final rules adopted on September 18, 2024, the SEC rules prohibit a national securities exchange from imposing any fee or providing any rebate for the execution of an order in an NMS stock unless such fee or rebate can be determined at the time of execution. Please discuss whether we should take a similar approach in Canada.
Summary of Comments |
CSA Response |
|
|
• Generally, all commentors support pre-trade transparency in trading fees. Some commentors agreed that investors benefit from understanding the full extent of the trading costs at the time of execution. However, other commentors believe that using the existing published fee schedules is sufficient for pre-trade fee transparency. |
• Generally, Canada's marketplaces offer different volume discount programs than those that exist in the U.S. which result in less frequent routing conflicts in Canada. As such, there is no change to the pre-trade fee transparency requirements at this time. |
In Ontario, the Amendments and other required materials were delivered to the Minister of Finance on April 22, 2026. The Minister may approve or reject the amendments or return them for further consideration. If the Minister approves the amendments or does not take any further action by June 22, 2026, the amendments will come into force on November 2, 2026.
{1} An active trading fee refers to the fee applied for executing an order that was entered to execute against a displayed order on a particular marketplace.
{2} www.ciro.ca/newsroom/publications/amendments-respecting-trading-increments
{3} CSA Notice and Request for Comment -- Proposed Amendments to National Instrument 23-101 Trading Rules. The CSA and CIRO had earlier published a request for feedback on the SEC Tick Size Rule and the SEC Trading Fee Rule when they were first proposed by the SEC and published for comment: CSA/CIRO Staff Notice 23-331 Request for Feedback on December 2022 SEC Market Structure Proposals and Potential Impact on Canadian Capital Markets (19 October 2023).
{4} https://www.sec.gov/files/rules/exorders/2025/34-104172.pdf
{5} The CAD/USD exchange rate was approximately 1.44 at the time of publication of the Request for Comment.
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- ETF that invests in a portfolio consisting of the six largest Canadian banks in its investment objectives granted relief from the concentration restriction in NI 81-102, subject to conditions.
National Instrument 81-102 Investment Funds, ss. 2.1(1.1) and 19.1.
April 14, 2026
The principal regulator in the Jurisdiction has received an application from the Filer, on behalf of Harvest Premium Yield Canadian Bank ETF (the Harvest ETF) for a decision (the Exemption Sought) under the securities legislation of the principal regulator (the Legislation) relieving the Harvest ETF from section 2.1(1.1) of National Instrument 81-102 Investment Funds (NI 81-102), in order to permit the Harvest ETF to purchase securities of an issuer, enter into a specified derivatives transaction or purchase an index participation unit even though, immediately after the transaction, more than 20% of the net asset value (NAV) of the Harvest ETF would be invested, directly or indirectly, in securities of any issuer (the Concentration Relief).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for the application; and
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in all of the provinces and territories of Canada other than the Jurisdiction (together with the Jurisdiction, the Jurisdictions).
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Constituent Securities means Equity Securities of a Canadian bank listed on the TSX.
Equity Securities means any securities that represent an interest in an issuer, including common shares, securities convertible into or exchangeable for common shares and American Depositary Receipts, provided that the determination by the Manager that a security is an Equity Security shall be conclusive for all purposes herein.
TSX means the Toronto Stock Exchange.
This decision is based on the following facts represented by the Filer:
The Filer
1. The Filer is a corporation incorporated under the laws of the Province of Ontario, with its head office located at 610 Chartwell Road, Suite 204 in Oakville, Ontario.
2. The Filer is registered as an investment fund manager and portfolio manager in the province of Ontario and as an investment fund manager in the provinces of Newfoundland and Labrador and Québec.
3. The Filer is the registered investment fund manager and registered portfolio manager of the Harvest ETF.
The Harvest ETF
4. The Harvest ETF is an exchange traded alternative mutual fund (as defined in NI 81-102) governed by the laws of a Jurisdiction of Canada and a reporting issuer under the laws of the Jurisdictions.
5. The Filer has filed a long form prospectus on behalf of the Harvest ETF with the securities regulatory authority in each of the Jurisdictions.
6. The Harvest ETF is subject to NI 81-102, subject to any exemptions therefrom that may be granted by the securities regulatory authorities.
7. The units of the Harvest ETF (the Units) are listed on the TSX.
8. Neither the Filer nor the Harvest ETF is in default of any of its obligations under securities legislation in any of the Jurisdictions.
9. The investment objective of the Harvest ETF is to seek to provide unitholders with (i) the opportunity for capital appreciation by investing, directly or indirectly, on a levered basis, in a portfolio of Equity Securities of Canadian banks; (ii) regular cash distributions; and (iii) lower overall volatility of portfolio returns than would otherwise be experienced by owning the securities held by the Harvest ETF, directly. To achieve lower overall volatility of portfolio returns and generate monthly premiums, the Harvest ETF will write covered call and/or covered put options on the Equity Securities held in its portfolio. The level of option writing may vary based on market volatility and other factors.
10. The investment objective and investment strategy of the Harvest ETF, as well as the risk factors associated therewith, including concentration risk and use of leverage, are disclosed in the prospectus of the Harvest ETF, as may be amended from time to time.
11. The Exemption Sought is requested to permit the Harvest ETF to purchase Constituent Securities or enter into specified derivatives transactions in connection therewith, including covered call and/or covered put options, such that, immediately after the transaction, more than 20% of the NAV of the Harvest ETF would be invested in the Constituent Securities of one issuer for the purposes of determining compliance with section 2.1(1.1) of NI 81-102 (the Concentration Restriction).
Rationale for the Relief
12. In order to achieve its investment objectives, the Harvest ETF will invest in the Equity Securities of Canadian banks listed on the TSX. The initial portfolio of the Harvest ETF includes the Equity Securities of six Canadian banks (being Royal Bank of Canada, Toronto-Dominion Bank, Bank of Nova Scotia, Bank of Montreal, Canadian Imperial Bank of Commerce and National Bank of Canada) (the Initial Constituent Banks). While the Harvest ETF may invest in the Equity Securities of other Canadian banks listed on the TSX, the Harvest ETF will only do so in response to fundamental changes in the sector or extraordinary events such as mergers, bankruptcies, amalgamations or options in respect of the Equity Securities of the Initial Constituent Banks not being listed on a recognized options exchange.
13. The Harvest ETF will use leverage in order to achieve its investment objective. The maximum aggregate exposure of the Harvest ETF to cash borrowing, short selling and specified derivatives will not exceed approximately 50% of its NAV. It is anticipated that such leverage will be created through the use of cash borrowings and/or specified derivatives.
14. Any investments by the Harvest ETF (owing, for example, to subscriptions received in respect of units of the Harvest ETF) will be made in accordance with the Harvest ETF's investment strategies.
15. The Concentration Restriction restricts an alternative mutual fund from purchasing a security of an issuer, entering into a specified derivatives transaction or purchasing an index participation unit if, immediately after the transaction, more than 20% of its NAV would be invested in securities of any one issuer.
16. Given the composition of the Harvest ETF's portfolio and the Harvest ETF's investment strategies, which include use of leverage and writing of covered call and/or put options, the Harvest ETF requires relief from the Concentration Restriction as it may, from time to time, be offside the Concentration Restriction.
17. In the absence of the Exemption Sought, the Harvest ETF would not be able to employ the level of leverage contemplated by its investment strategies since doing so may result in an issuer representing a greater portion of the Harvest ETF's NAV than is permitted by the Concentration Restriction. For example, if the Harvest ETF were to employ 50% leverage and hold an equally weighted portfolio of Equity Securities of the Initial Constituent Banks, each issuer would represent approximately 25% of the Harvest ETF's NAV.
18. The Filer notes that, in respect of the Harvest ETF, its strategy to obtain exposure to the Equity Securities of Canadian banks is transparent and fully disclosed to investors. The Harvest ETF will not invest in or provide exposure to securities other than Equity Securities of the Initial Constituent Banks (or securities designed to gain exposure to the securities of the Initial Constituent Banks) except in response to fundamental changes in the sector or extraordinary events. Should such an event occur which prompts the Harvest ETF to hold Equity Securities of a Canadian bank other than the Initial Constituent Banks, the Harvest ETF will issue a news release disclosing such proposed change.
19. The Constituent Securities will be rebalanced at least semi-annually to maintain an approximately equal weight exposure to the Equity Securities held in each of the Initial Constituent Banks.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted, provided that:
(a) the investments of the Harvest ETF are in accordance with the investment objective and investment strategies of the Harvest ETF;
(b) the Harvest ETF's investment strategies disclose that the Harvest ETF will obtain exposure to Canadian banks based on its investment objective and the next prospectus of the Harvest ETF, and each renewal thereafter, will disclose that the Harvest ETF will invest in the Equity Securities of Canadian banks in approximately equal weights and the portfolio will be rebalanced at least semi-annually to maintain approximately equal weight exposure to the Equity Securities. Any investments by the Harvest ETF (owing, for example, to subscriptions received in respect of Units of the Harvest ETF) will be made in accordance with the investment strategies of the Harvest ETF; and
(c) the next prospectus of the Harvest ETF, and each renewal thereafter, will include: (i) disclosure regarding the Exemption Sought under the heading "Exemptions and Approvals"; and (ii) a risk factor regarding the concentration of the Harvest ETF's investments in the Initial Constituent Banks and the risks associated therewith.
Application File #: 2025/0752
SEDAR+ File #: 6379138
National Bank Investments Inc. and NBI SmartData Enhanced Yield U.S. Equity Fund
Policy Statement 11-203 respecting Process for Exemptive Relief Applications in Multiple Jurisdictions -- Exemption granted to mutual funds from the 10% of NAV margin deposit limit in subsection 6.8(1) and paragraph 6.8(2)(c) of Regulation 81-102 respecting Investment Funds to permit each fund to deposit as margin portfolio assets of up to 35% of the fund's NAV with any one dealer in Canada or the U.S. and up to 70% of each fund's NAV with all dealers in the aggregate, for transactions involving exchange traded specified derivatives -- Each fund's investment objectives and strategies permit the fund to invest in exchange traded specified derivatives -- Relief granted subject to condition that relief is relied on by each fund only with respect to investments in derivatives that are exchange traded specified derivatives, that the amount of margin held by any one dealer on behalf of that fund does not exceed 35% of the fund's NAV, and that the amount of margin held by dealers in the aggregate on behalf of that fund does not exceed 70% of the fund's NAV as at the time of deposit.
National Instrument 81-102 respecting Investment Funds, ss. 6.8(1), 6.8(2)(c) and 19.1.
[Original text in French]
SEDAR+ filing No: 06405373
April 14, 2026
The securities regulatory authority or regulator in each of the Jurisdictions (the "Decision Makers") has received an application from the Filer, on behalf of the SmartData Fund, a new covered call fund, and each existing investment fund that is a reporting issuer and to which Regulation 81-102 respecting Investment Funds, CQLR, c. V-1.1, r. 39 ("Regulation 81-102") apply, for which the Filer, or an affiliate of the Filer, acts as investment fund manager (the "Existing Funds"), and each investment fund to be established in the future, that will be a reporting issuer and to which Regulation 81-102 will apply, for which the Filer, or an affiliate of the Filer, will act as manager (together with the Existing Funds, the "Funds" and, individually a "Fund") and are, or will be, permitted by their investment objective and investment strategies to invest in Exchange Traded Specified Derivatives (as defined herein), for a decision under the securities legislation of the Jurisdictions (the "Legislation") pursuant to section 19.1 of Regulation 81-102 for an exemption from:
(a) subsection 6.8(1) of Regulation 81-102, which restricts an investment fund from depositing portfolio assets as margin with a member of a regulated clearing agency or dealer that is a member of a self-regulatory organization that is a participating member of the Canadian Investor Protection Fund ("CIPF") for a transaction in Canada involving certain specified derivatives in excess of 10% of the net asset value ("NAV") of the investment fund at the time of deposit; and
(b) paragraph 6.8(2)(c) of Regulation 81-102, which restricts an investment fund from depositing portfolio assets as margin with a member of a regulated clearing agency or dealer for a transaction outside of Canada involving certain specified derivatives in excess of 10% of the NAV of the investment fund as at the time of deposit;
to permit each Fund to deposit as margin portfolio assets of up to 35% of the Fund's NAV as at the time of deposit with any one futures commission merchant in Canada or the United States (the "Dealers" and, each a "Dealer") and up to 70% of each Fund's NAV at the time of deposit with all Dealers in the aggregate, for transactions involving standardized futures, clearing corporation options, options on futures, or cleared specified derivatives (together, "Exchange Traded Specified Derivatives") (the "Requested Relief").
Under the Process for Exemptive Relief Application in Multiple Jurisdictions (for a dual application):
(a) the Autorité des marchés financiers is the principal regulator for this Application;
(b) the Filer has provided notice that subsection 4.7(1) of Regulation 11-202 respecting Passport System, CQLR, c. V-1.1, r. 1 ("Regulation 11-102") is intended to be relied upon by the Filer in each of British Columbia, Alberta, Saskatchewan, Manitoba, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Yukon, Northwest Territories and Nunavut (collectively with the Jurisdictions, the "Jurisdictions of Canada"); and
(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Terms defined in Regulation 14-101 respecting Definitions, CQLR, c. V-1.1, r. 3, Regulation 11-102, Regulation 41-101 respecting General Prospectus Requirements, CQLR, c. V-1.1, r. 14 ("Regulation 41-101") Regulation 81-101 respecting Mutual Fund Prospectus Disclosure, CQLR, c. V-1.1, r. 38 ("Regulation 81-101") and Regulation 81-102 have the same meaning if used in this decision, unless otherwise defined.
This decision is based on the following facts represented by the Filer:
The Filer
1. The Filer is a corporation amalgamated under the laws of Canada with its head office in Montreal, Québec.
2. The Filer is registered as an investment fund manager in Québec, Ontario and Newfoundland and Labrador, as a portfolio manager in the Jurisdictions of Canada, as a derivatives portfolio manager in Québec and as a commodity trading manager in Ontario.
3. The Filer, or an affiliate of the Filer, is, or will be, the investment fund manager of each of the Funds.
4. The Filer, or an affiliate of the Filer, may act as portfolio manager of the Funds or may appoint one or more portfolio managers for the Funds or portfolio sub-advisors to provide the Filer with investment advice in respect of a Fund's investments.
5. The Filer is not in default of applicable securities legislation in the Jurisdictions of Canada.
The Funds
6. Each Fund is, or will be, an investment fund organized and governed by the laws of one of the Jurisdictions of Canada or the laws of Canada.
7. The SmartData Fund will be an alternative mutual fund to which Regulation 81-102 applies, subject to any exemptions therefrom that have been, or may be, granted by the applicable Canadian securities regulatory authorities or regulators.
8. Each Fund is, or will be, a mutual fund to which Regulation 81-102 applies (including an alternative mutual fund, a non-alternative mutual fund, an ETF, or a non-exchange traded mutual fund), subject to any exemptions therefrom that have been, or may be, granted by the applicable Canadian securities regulatory authorities or regulators.
9. The securities of each Fund are, or will be, qualified for distribution in one or more of the Jurisdictions of Canada using a simplified prospectus prepared in accordance with Regulation 81-101, or a long form prospectus prepared in accordance with Regulation 41-101 with the related fund facts and ETF facts, as applicable, filed in one or more of the Jurisdictions of Canada and, accordingly, each Fund is, or will be, a reporting issuer in the Jurisdictions of Canada where the Requested Relief is relied upon.
10. The investment objective and investment strategies of each Fund permit or will permit the Fund to invest in Exchange Traded Specified Derivatives.
11. The investment objective of the SmartData Fund will be to aim to provide long-term capital growth and to generate income. The SmartData Fund invests directly, or through investments in securities of other mutual funds, in a portfolio mainly composed of equities of U.S. companies. The SmartData Fund may use leverage through the use of derivatives, cash borrowing and short selling, subject to the limits described in the "Investment Strategies" section of its simplified prospectus or as otherwise permitted under the Legislation.
12. As part of its investment strategies, the SmartData Fund will use a strategy where it aims to generate additional yield and to mitigate overall portfolio volatility, by employing a dynamic options strategy pursuant to which it writes call options on a portion of the market value of the portfolio. Under normal market conditions, the SmartData Fund expects the option writing level to be between 30% and 60%. The option writing level means the percentage of the fund's portfolio on which call options are written, calculated as the notional value of call options sold divided by the market value of the portfolio, including any borrowing. The portfolio manager may increase or decrease this level from time to time at its discretion. The SmartData Fund generally expects to write call options on underliers that provide economic exposure to the fund's reference index, rather than on individual securities.
13. In order to achieve their investment objectives, from time to time, each Fund may use Exchange Traded Specified Derivatives for hedging purposes and non-hedging purposes, mitigating portfolio volatility, generating income and providing limited downside protection by writing call options on the securities in its portfolio, on its reference index or on an underlying interest similar to the characteristics of its portfolio. Each of these derivative positions will otherwise comply with Regulation 81-102 derivative provisions and restrictions for mutual funds.
14. None of the Existing Funds are in default of securities legislation in any of the Jurisdictions of Canada.
15. Except to the extent that the Requested Relief is granted and other exemptive relief is applicable, the investment strategies of the Funds are, or will be, limited to the investment practices permitted by Regulation 81-102.
16. The Filer, the portfolio manager or the portfolio sub-advisor to a Fund is, or will be, authorized to establish, maintain, change and close brokerage accounts on behalf of the Fund. In order to facilitate transactions on behalf of a Fund, the Filer, the portfolio manager or the portfolio sub-advisor to the Fund will establish one or more accounts (each an "Account") with one or more Dealers.
The Dealers
17. Each Dealer in Canada (each a "Canadian Dealer") is a member of the Canadian Investment Regulatory Organization ("CIRO"), or successor to CIRO, in Canada and is registered in the applicable Jurisdictions of Canada as a futures commission merchant or equivalent.
18. Each Canadian Dealer is a member of the exchanges, clearing agencies or swap execution facility through which the Exchange Traded Specified Derivatives are primarily traded. Each such exchange, clearing agency and swap execution facility is obliged to apply its surplus funds and the security deposits of its members to reimburse clients of failed members. Each Canadian Dealer is required to segregate the assets of a Fund deposited as Initial Margin (as defined herein) from the assets of the Canadian Dealer. Each Fund shall deposit portfolio assets as Initial Margin with a Canadian Dealer only if that dealer is required to segregate those portfolio assets from its own assets.
19. Each Dealer in the United States (each a "U.S. Dealer") is regulated by the Commodity Futures Trading Commission ("CFTC") and the National Futures Association ("NFA"), or successor to the CFTC or the NFA, in the United States and is required to segregate the Initial Margin held on behalf of clients, including the Funds. Each U.S. Dealer is subject to regulatory audit and must have insurance to guard against employee fraud. Each U.S. Dealer has a net worth, determined from its most recent audited financial statements, in excess of the equivalent of C$50 million. Each U.S. Dealer has an exchange assigned to it as its designated self-regulatory organization (a "DSRO"). As a member of a DSRO, each U.S. Dealer must meet capital requirements, comply with the conduct rules of the CFTC, NFA and its DSRO, and participate in an arbitration process with a complainant.
20. Where a U.S. Dealer is not a member of an exchange over which it wishes to effect a trade on behalf of a Fund, it must engage a carrying broker that is a member of such exchange to effect the trade. Consequently, whether the trades are done directly by the U.S. Dealer or through a carrying broker, the U.S. Dealer is required to segregate the assets of the Fund deposited as Initial Margin from the assets of the U.S. Dealer. Each Fund shall deposit portfolio assets as Initial Margin with a U.S. Dealer only if that dealer is required to segregate those portfolio assets from its own assets.
21. A Dealer will require, for each Account, that portfolio assets of the Fund be deposited with the Dealer as collateral for transactions in Exchange Traded Specified Derivatives (the "Initial Margin"). The Initial Margin represents the minimum initial amount of portfolio assets that must be deposited with a Dealer to initiate trading in specified derivatives transactions or to maintain the Dealer's open position in standardized futures.
22. Levels of the Initial Margin are established at a Dealer's discretion. At no time will more than 70% of the NAV of each Fund be deposited as Initial Margin with all Dealers in the aggregate.
23. The records of each Dealer will show that the applicable Fund is the beneficial owner of the Initial Margin, and evidence that, subject to the satisfaction of the Dealer's applicable margin requirements, the applicable Fund will have the right to the return of the portfolio assets deposited as Initial Margin with the Dealer, such assets being of the same issue as the deposited margin, including the same class and series, if applicable, and having the same current aggregate market value of the deposited margin at the time of such return.
Reasons for the Requested Relief
24. The use of Initial Margin is an essential element of investing in Exchange Traded Specified Derivatives for the Funds.
25. The Requested Relief would allow the Funds to invest in Exchange Traded Specified Derivatives more extensively with any one Dealer, which would allow the Funds to pursue their investment strategies more efficiently and flexibly.
26. Opening Accounts and transacting with multiple Dealers adds complexity and cost to the management of the Funds. Using fewer Dealers will considerably simplify the Funds' investments and operations and will reduce the cost of implementing each Fund's strategy. Using fewer Dealers also simplifies compliance and risk management, as monitoring the data, controls and policies of a smaller number of Dealers is less complex.
27. The principal regulator is satisfied that it would not be prejudicial to the public interest to grant the Requested Relief.
Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Makers to make the decision.
The decision of the Decision Makers under the Legislation is that the Requested relief is granted provided that:
a) Each Fund will rely on this decision only with respect to investment in derivatives that are Exchange Traded Specified Derivatives;
b) Each Fund shall only use Initial Margin such that the amount of Initial Margin held by any one Dealer on behalf of the Fund does not exceed 35% of the NAV of the Fund, taken at market value as at the time of the deposit; and
c) Each Fund shall only use Initial Margin such that the amount of Initial Margin held by Dealers in aggregate on behalf of each Fund does not exceed 70% of the NAV of each Fund as at the time of the deposit.
Temporary, Permanent & Rescinding Issuer Cease Trading Orders
Company Name |
Date of Temporary Order |
Date of Hearing |
Date of Permanent Order |
Date of Lapse/Revoke |
|
||||
THERE IS NOTHING TO REPORT THIS WEEK. |
||||
Company Name |
Date of Order |
Date of Revocation |
|
||
THERE IS NOTHING TO REPORT THIS WEEK. |
||
Temporary, Permanent & Rescinding Management Cease Trading Orders
Company Name |
Date of Order |
Date of Lapse |
|
||
Enthusiast Gaming Holdings Inc. |
April 6, 2026 |
April 16, 2026 |
Outstanding Management & Insider Cease Trading Orders
Company Name |
Date of Order or Temporary Order |
Date of Hearing |
Date of Permanent Order |
Date of Lapse/Expire |
Date of Issuer Temporary Order |
|
|||||
Performance Sports Group Ltd. |
19 October 2016 |
31 October 2016 |
31 October 2016 |
__________ |
__________ |
Company Name |
Date of Order |
Date of Lapse |
|
||
Agrios Global Holdings Ltd. |
September 17, 2020 |
__________ |
|
||
Sproutly Canada, Inc. |
June 30, 2022 |
__________ |
|
||
iMining Technologies Inc. |
September 30, 2022 |
__________ |
|
||
Alkaline Fuel Cell Power Corp. |
April 4, 2023 |
__________ |
|
||
mCloud Technologies Corp. |
April 5, 2023 |
__________ |
|
||
FenixOro Gold Corp. |
July 5, 2023 |
__________ |
|
||
HAVN Life Sciences Inc. |
August 30, 2023 |
__________ |
|
||
Perk Labs Inc. |
April 4, 2024 |
__________ |
|
||
Enthusiast Gaming Holdings Inc. |
April 6, 2026 |
April 16, 2026 |
Issuer Name:
Principal Regulator:
Type and Date:
Filing #: 06427531
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Filing #: 06405661
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Filing #: 06414282
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Filing #: 06398752
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Filing #: 06289668
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Filing #: 06350465
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Filing #: 06303255
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Filing #: 06253135
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Offering Price and Description:
Filing #: 06425389
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Offering Price and Description:
Filing #: 06426852
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Offering Price and Description:
Filing #: 06427414
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Offering Price and Description:
Filing #: 06427329
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Offering Price and Description:
Filing #: 06423988
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Offering Price and Description:
Filing #: 06423539
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Offering Price and Description:
Filing #: 06423539
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Issuer Name:
Principal Regulator:
Type and Date:
Offering Price and Description:
Filing #: 06428510
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Type |
Company |
Category of Registration |
Effective Date |
|
|||
Change Registration Category |
ENOCH WEALTH INC. |
From: Exempt Market Dealer |
April 15, 2026 |
|
|||
|
|
To: Exempt Market Dealer and Investment Fund Manager |
|
Canadian Investment Regulatory Organization (CIRO) -- Housekeeping Amendments to MFDR Form 1 and IDPC Form 1 respecting Derecognition of Financial Liabilities -- Notice of Commission Deemed Approval
The Ontario Securities Commission did not object to CIRO's proposed housekeeping amendments to the general notes and definitions in both the Mutual Fund Dealer Rules (MFDR) Form 1 and the Investment Dealer and Partially Consolidated (IDPC) Form 1 to allow Dealer Members to either continue applying existing accounting policies or adopt the new International Financial Reporting Standards (IFRS) for derecognition of financial liabilities (the Housekeeping Amendments). The main objective of the Housekeeping Amendments is to conform to applicable accounting standards (i.e., IFRS 9 amendments). As a result, the Housekeeping Amendments were deemed approved or non-objected to.
The Housekeeping Amendments will be effective on April 27, 2026.
In addition, the Alberta Securities Commission; the Autorité des marchés financiers; the British Columbia Securities Commission; the Financial and Consumer Affairs Authority of Saskatchewan; the Financial and Consumer Services Commission of New Brunswick; the Manitoba Securities Commission; the Northwest Territories Office of the Superintendent of Securities; the Nova Scotia Securities Commission; the Nunavut Office of the Superintendent of Securities; the Office of the Superintendent of Securities, Digital Government and Services, Newfoundland and Labrador; the Office of the Yukon Superintendent of Securities; and the Prince Edward Island Office of the Superintendent of Securities (together with the Ontario Securities Commission, the Recognizing Regulators) did not object to the classification of the Housekeeping Amendments and therefore the Housekeeping Amendments were deemed approved or non-objected to.
A copy of the CIRO Bulletin, including text of the approved Housekeeping Amendments, is also published on our website at www.osc.ca.