TSX Inc. recently approved amendments to its rules, which have now been submitted to the OSC for approval, that would facilitate the trading of securities that are not listed on the TSX but are listed on another exchange recognized by a Canadian securities regulator. The OSC has now published the proposal for a public comment period that runs until June 20.
Specifically, the proposed amendments would distinguish between securities that are listed and traded on the TSX and those that are not listed, but posted for trading. According to the TSX, all securities traded, whether listed or not, would trade in the same book and all trades would be subject to TSX rules. Furthermore, order entry would be identical for both types of securities.
The proposed amendments anticipate growing competition in the Canadian equity trading business, especially in light of Alpha Exchange Inc.'s application to operate as an exchange. According to the notice,
As the multi-marketplace environment in Canada continues to increase its breadth and depth, TSX is in a unique position to meet the needs of its Participating Organizations (POs) and investors. Clarifying the TSX Rules to permit trading in securities that are not listed by Toronto Stock Exchange allows TSX to leverage its trade execution strength in the event that it determines to trade securities that are listed on another Canadian exchange.
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