CNSX Markets Inc. Implementation of the CSA's Order Protection Rule ("OPR") -
Draft for Discussion Purposes

CNSX Notice 2010 - 002

Pure Trading Notice 2010 - 014

TORONTO, June 7 /CNW/ - Part of the amendments to National Instrument 21-101 Marketplace Operation and National Instrument 23-101 Trading Rules ("NI 23-101") that were approved by the CSA in late 2009 will have the effect of moving the responsibility for implementing order protection (trade-through avoidance) policies and procedures from participating dealers to marketplaces on February 1, 2011. This notice provides details of the approach that CNSX Markets Inc. will undertake in order to comply with the order protection obligation for trading on the Canadian National Stock Exchange ("CNSX") and Pure Trading.

    OPR Implementation Approach

    In order to minimize the impact of changes on system vendors and
participating dealers, while complying with the amended marketplace and
trading rules, CNSX Markets Inc. will provide two approaches for parties
routing orders to CNSX and Pure Trading which conform to the existing FIX and
STAMP protocols in use for order entry on both marketplaces:

    1.  All orders provided directly to the STAMP and FIX gateways from a
        participant dealer's system will be assumed by CNSX Markets Inc. to
        be directed-action orders ("DAO") as defined in NI 23-101. Once an
        order has reached the order entry gateway, the system will not check
        for execution opportunities at other trading venues. The
        participating dealer entering or sponsoring the order will be assumed
        to have taken responsibility for having subjected the order to
        reasonable policies and procedures intended to avoid trading through
        better-priced "protected" bids and offers in accordance with NI 23-
        101. These orders and subsequent actions on the order will be
        identified by CNSX Markets Inc. as DAO for the purposes of regulatory
        reporting to IIROC.
    2.  Participating dealers not prepared to accept the default designation
        of orders as DAO will have their orders intermediated by a smart
        order router deployed by CNSX Markets Inc. The router is intended to
        provide order protection and other functions typically offered by
        available industry solutions, including the ability to book non-
        marketable orders according to preferences established by the sending
        participating dealer, and providing the flexibility to define
        preferences when the order may execute against protected orders
        showing on more than one marketplace. Participating dealers will be
        able to assume responsibility for order protection for specific
        orders sent through the smart router by using one of the directed
        order types. Orders sent through the router will be marked
        appropriately to indicate that the order protection obligation for a
        particular order was provided by CNSX Markets. This information will
        be captured by CNSX Markets and reported to IIROC.

Parties interested in understanding more about the functionality offered by the CNSX Markets' order protection solutions should contact Pina De Santis at

Participating dealers electing to employ our order protection solution to connect to CNSX Markets Inc. trading venues will have to implement network changes to support the move. We will be contacting participating dealers and their vendors to ensure that planning of any required changes is completed by late summer/early fall, 2010.

SOURCE Canadian National Stock Exchange (CNSX)

For further information: For further information: please contact your sales team representative: Pina De Santis,; Stefan Frirdich,; Adam Schmidt,

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