On May 15, the Canadian Securities
Administrators published for comment proposed amendments to trading
rules intended to address the costs and inefficiencies
associated with the current order protection rule framework.
The order protection rule, which came into effect in 2011,
requires marketplaces to establish and ensure compliance with
policies and procedures designed to prevent trade-throughs on that
marketplace. The protection is intended to ensure that all
immediately accessible, visible, better-priced limit orders are
executed before inferior-priced limit orders and are not traded
through.
While the CSA believe that the rule enhances confidence in the
fairness and integrity of the market, the fragmentation of order
flow across multiple marketplaces has led to increased complexities
and costs for market participants. For example, some dealers may
pay more in respect of membership or subscriber fees to access
certain marketplaces than the total amount invoiced
