With Maple Group Acquisition Corp.’s takeover of Toronto-based TMX Group Inc. now finalized, the Investment Industry Association of Canada (IIAC) is launching a committee that will ensure industry firms and their clients continue to be protected by pricing, trading and regulatory safeguards.

The IIAC announced on Wednesday the formation of the IIAC TMX Group Advisory Committee, which has a mandate to monitor the implementation and effectiveness of safeguards for pricing and access to services offered by Maple Group to market participants.

“The Maple transaction has been a contentious issue for the investment industry, in terms of the merits of the transaction and the needed protections for investors and issuers,” said Ian Russell, president and CEO of the IIAC. “However, now that the deal is finalized, the industry, led by the IIAC, will encourage and assist in the efficient and timely consolidation of services in the new TMX Group to minimize disruptions in our markets and related costs to our member firms.”

Added Russell: “The Advisory Committee will make it a priority that the TMX Group implements expeditiously safeguards for pricing and access of trade execution and clearing required as a condition for approval of the deal.”

There are four specific areas of concern to the investment industry: clearing and settlement; trading; market data costs; and regulatory infrastructure.

Specifically, the IIAC wants to ensure that there is:

  • appropriate oversight and approval mechanisms to ensure clearing costs, trading costs and market data costs are fair and reasonable;
  • flexibility for market participants to direct executed trades to other clearing venues;
  • access to clearing services available on fair terms to all registered investment dealers; and,
  • fair treatment for retail and institutional investors relative to high frequency trading operations in terms of trading fees and access.

In terms of regulatory infrastructure, the association wants to ensure that proposed price increases for Maple trading, clearing, data and listing services will require regulatory review and approval. The committee will monitor the infrastructure to ensure the required resources and expertise are put in place to carry out its mandate effectively, the IIAC said.

The IIAC TMX Group Advisory Committee will be comprised of small, medium and large dealer member firms. It will be available to TMX Group representatives and regulators to assist in the implementation of appropriate safeguards for industry firms and their clients.

“We look forward to working with TMX Group representatives and the regulators on these issues to ensure the interests of our member firms are properly addressed,” Russell said.