Last week, IIROC announced that regulators have approved its proposed integrated fee model. As we've discussed in previous posts, IIROC proposed a new dealer regulation fee model in April 2010 and a new market regulation fee model in November of that year (which it republished in 2011).
The integrated fee model works on the basic principle of allocating IIROC's annual operating cost to two pools of costs, comprising of dealer and market regulation, and recovering from dealers and marketplaces on the basis of each function's cost drivers. Under the dealer regulation fee model, rates will be determined by a dealer's revenue tier, while the fees for each marketplace will be based on a marketplace's share of the total number of messages processed by IIROC's surveillance system (in order to recover the IT costs of surveillance), as well as a fee based on the marketplace's share of the total number of trades (in order to recover all other regulation costs).
The new fee model will be implemented by IIROC on April 1, 2012. IIROC expects to publish further information, including guidelines prior to that date. For more information, see IIROC Notice 12-0043.
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