TORONTO, Oct. 20, 2016 /CNW/ - The Investment Industry Regulatory Organization of Canada (IIROC) today published a summary of the comments received at a roundtable discussion of market structure issues affecting small-cap issuers and outlined its next steps based on this stakeholder input.
IIROC will review the requirements and frequency of reporting of short activity to determine whether transparency can be enhanced. IIROC currently publishes a bi-monthly Short Sale Trading Statistics Summary which is available on its website.
In addition, IIROC will refresh a 2007 study of failed trades with a focus on small-cap issuers which may lead to further targeted work on short selling to determine if any policy steps are required.
These actions respond to concerns and suggestions discussed at the roundtable held earlier this year that provided stakeholders with the opportunity to offer analysis and recommend potential regulatory responses to issues.
Other themes raised at the forum include the need for securities regulations to reflect the trading differences between large cap and small-cap securities, concerns about reduced liquidity in small-cap securities, and the perception of the negative impact of short selling leading to less investor confidence and lower rates of participation in the small-cap market.
"IIROC recognizes the significance of the small-cap market. We listened carefully to our stakeholders and are taking a data driven approach and concrete steps to address their concerns," said Warren Funt, IIROC Vice-President, Western Canada.
"We are committed to working with our partners to strengthen this market and foster confidence in its fairness and integrity, and will actively seek opportunities to broaden the understanding of market structure issues affecting this important sector," said Victoria Pinnington, IIROC Senior Vice-President, Market Regulation.
IIROC is the national self-regulatory organization which oversees all investment dealers and their trading activity in Canada's debt and equity markets. IIROC sets high quality regulatory and investment industry standards, protects investors and strengthens market integrity while supporting healthy Canadian capital markets. IIROC carries out its regulatory responsibilities through setting and enforcing rules regarding the proficiency, business and financial conduct of dealer firms and their registered employees and through setting and enforcing market integrity rules regarding trading activity on Canadian equity marketplaces.
SOURCE Investment Industry Regulatory Organization of Canada (IIROC) - General News
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