The fee model for the new debt market surveillance system that will be implemented next month has been sent to the provincial regulators for approval, the Investment Industry Regulatory Organization of Canada (IIROC) announced on Monday.

If that approval is granted, the fee model will be implemented on Nov. 1, and monthly invoicing will start in mid-December, IIROC says in an administrative notice.

IIROC is to begin collecting debt trading data from dealers in November, in a move designed to enhance investor protection and market oversight. The fee model, which aims to cover IIROC’s cost of regulating the debt markets, will set levies based on each dealer’s pro-rata share of reportable transactions, including primary, secondary and repo transactions, the notice says.

The repo transaction portion of the fees will be reduced by cost recoveries from the Bank of Canada, IIROC notes. The self-regulatory organization also intends to implement a late filing fee, which will be based on the additional effort required to input late data, make corrections and perform market surveillance.

In additionally, IIROC notes that it intends to reassess the model after a couple of years to determine whether the fees are properly aligned with the costs. “As this is a new regulatory activity for which processes are not yet fully known, IIROC will review the fee model after one to two years and adjust it if required for better alignment with the guiding principles and with effort expended,” the IIROC notice says.