The Canadian Securities Administrators (CSA) on Thursday issued guidance to clarify the scope of the international dealer exemption in response to reports of a perceived decline in liquidity in the Canadian fixed income market.

CSA Staff Notice 31-346 Guidance as to the Scope of the International Dealer Exemption in relation to Foreign-Currency Fixed Income Offerings by Canadian Issuers addresses concerns raised by Canadian institutional investors over reduced access to international dealers that trade foreign-currency-denominated fixed income securities issued by Canadian issuers.

Additionally, the notice provides guidance to clarify the scope of the international dealer exemption in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations and confirms the willingness of CSA Staff to recommend exemptive relief, if required, to facilitate greater access to global fixed income markets by Canadian issuers and Canadian institutional investors.

“CSA Staff recognize that these are areas of concern for market participants, and have issued this notice to highlight our ongoing consideration of these issues,” says Louis Morisset, chairman of the CSA and president and CEO of the Autorité des marchés financiers, in statement.

Staff continue to work to consider market participants’ concerns regarding the new harmonized report of exempt distribution (Form 45-106F1), which came into force on June 30, the CSA says.