This is a reminder that the deadline for compliance with the first phase of National Instrument 24-101 - Institutional Trade Matching and Settlement (NI 24-101) is just around the corner, with certain provisions of the instrument coming into force on October 1, 2007.
NI 24-101 requires that all participants involved in institutional trades (which includes investment advisers, investment dealers and custodians) make changes to their trade order management systems and operational processes to meet the timing and performance objectives set out in NI 24-101 to achieve trade-matching by the end of business on trade date (T).
NI 24-101 adopts a phased-in approach, setting out progressive trade-matching milestones, with the expectation that matching institutional trades by the end of T will be achieved by July 1, 2008.
As part of the initial phase-in of NI 24-101, compliance with the following is required by no later than October 1, 2007:
- Trade-matching parties are to adopt and enforce policies and procedures designed to achieve matching as soon as practical after an institutional trade is executed;
- Registered dealers and advisers will be prohibited from accepting or giving orders to execute DAP or RAP on behalf of an institutional investor unless each trade-matching party has either entered into a trade-matching agreement or provided a trade-matching statement containing assurances that they have established and enforce policies and procedures to meet the requirements of NI 24-101;
- Exception reporting requirements are triggered if less than 80% of institutional trades are matched by noon on T + 1.
For additional information and compliance deadlines, please see Stikeman Elliott's June 2007 Securities Law Update.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
