Stock exchange operator TMX Group Ltd. will host a roundtable in January to examine the issue of the internalization of order flow, and regulators are pledging to study the issue as industry concerns grow.
The roundtable, to be held on Jan.23, 2018, will be either a half-day or full-day event, depending on demand, TMX says in an equities trading notice.
"The goal of the roundtable is to provide stakeholders with the opportunity to present and share their views and perspectives," the notice says. It aims to examine the "key drivers" of internalization, along with a discussion of the risks and benefits of the practice.
Firms interested in presenting at the event must make a request to the exchange by Dec. 15.
"While we aim to accommodate all requests to participate, presenters will be selected in a manner that best reflects a diversity of views to promote a balanced discussion," the notice says.
Regulators gathering information
The CSA and IIROC have begun, "gathering information in order to understand current practices and how these activities fit into our current rule framework, and in order to determine what, if any, action is required to ensure that the Canadian market is not negatively impacted," they say in joint statement published on Tuesday.
IIROC and the CSA "support the efforts by industry to engage in dialogue about important issues in the Canadian market, and the opinions presented and ideas generated will be a valuable input to our review," the statement adds.
"The issues are complex and there are a variety of factors that must be considered," the regulators say. "We will continue to explore these issues and seek public consultation in the coming months."
Key deadline: Dec. 15