ANNOTATED UNIVERSAL MARKET INTEGRITY RULES

Important Disclaimer
The following annotated version of the Universal Market Integrity Rules (UMIR) has
been prepared as an informal reference document by the Canadian Investment
Regulatory Organization (CIRO). While every effort has been made to ensure thecompleteness and accuracy of the document, users must recognize that thisannotated version is not the official version of UMIR.
The official version of UMIR is comprised of Schedule A.1 to Transition Rule No. 1
as amended from time to time as set out in Appendix A to Notices of Approval
posted to our website.
This annotated version of UMIR reflects material issued or published by CIRO up to
May 27, 2024. For material issued after May 27, 2024, refer to the list of Notices
on our website.

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TABLE OF CONTENTSPART 1 – DEFINITIONS AND INTERPRETATION
1.1
Definitions .......................................................................................... 1.1-1 – 1.1-41
1.2Interpretation………………………………………….……..…….…… 1.2-1 – 1.2-6
1.3Transitional Provision ........................................................................ 1.3-1PART 2 – ABUSIVE TRADING
2.1
Specific Unacceptable Activities..……………….…………..……….….. 2.1-1 – 2.1-9
2.2
Manipulative and Deceptive Activities….….……….…..……..…..… 2.2-1 – 2.2-14
2.3
Improper Orders and Trades.............................................................. 2.3.1
PART 3 – SHORT SELLING
3.1
Restrictions on Short Selling - repealed……………….……..…..…. 3.1-1 – 3.1-4
3.2
Prohibition on the Entry of Orders ...................................................... 3.2-1
PART 4 – FRONTRUNNING
4.1
Frontrunning…………………………………………….……..……..… 4.1-1 – 4.1-3
PART 5 – BEST EXECUTION OBLIGATION
5.1
Best Execution of Client Orders………………………...……..…..… 5.1-1 – 5.1-2
5.2Best Price Obligation — Repealed…………..……….…...…………. 5.2-1 – 5.2-3
5.3
Client Priority……………………………………………....……..…..… 5.3-1 – 5.3-6PART 6 – ORDER ENTRY AND EXPOSURE
6.1
Entry of Orders to a Marketplace……..………………….……..……. 6.1-1 – 6.1-3
6.2
Designations and Identifiers.............................................................. 6.2-1 – 6.2-7
6.3
Exposure of Client Orders………………………….........……..…….. 6.3-1 – 6.3-3
6.4
Trades to be on a Marketplace……………………….……..……..…. 6.4-1 – 6.4-7
6.5
Minimum Size Requirements of Certain Orders Entered on aMarketplace……………………………………….……..….……….…. 6.5-1
6.6
Provision of Price Improvement by a Dark Order ….……..……..…
6.6-1 – 6.6-2
PART 7 – TRADING IN A MARKETPLACE
7.1
Trading Supervision Obligations…………………….……..………… 7.1-1 – 7.1-26
7.2
Proficiency Obligations……………………………….……..………… 7.2-1
7.3
Liability for Bids, Offers and Trades…………………….……..…..… 7.3-1
7.4
Contract Record and Official Transaction Record….……..……..…
7.4-1
7.5
Recorded Prices……………………………………….……..………… 7.5-1 – 7.5-2
7.6
Cancelled Trades……………………………………….……..……..… 7.6-1
7.7
Trading During Certain Securities Transactions……………………. 7.7-1 – 7.7-8
7.8
Restrictions on Trading During a Securities Exchange Take-overBid – repealed ……………………………………………………..…... 7.8-1
7.9
Trading in Listed or Quoted Securities by a Derivatives Market
Maker……………………………………………….……..……………..
7.9-1
7.10
Extended Failed Trades………………………………….……..…..… 7.10-1– 7.10-2
7.11
Variation and Cancellation and Correction of Trades .……..……… 7.11-1
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7.12
Inability to Rely on Marketplace Functionality ……….……..…….…
7.13
Direct Electronic Access and Routing Arrangements…..……..……
7.14
Position limits for listed derivatives …..……..……………………….
PART 8 – PRINCIPAL TRADING
8.1
Client-Principal Trading……………………………..........……..…….
PART 9 – TRADING HALTS, DELAYS AND SUSPENSIONS
9.1
Regulatory Halts, Delays and Suspensions of Trading ...……...….
PART 10 – COMPLIANCE
10.1
Compliance Requirement.……………………………….……….……
10.2
Investigations…………………………………………….……..……....
10.3
Extension of Responsibility………………………………...………….
10.4
Extension of Restrictions…………………………………...……..…...
10.5
Powers and Remedies…………………………………….……..…....
10.6
Exercise of Authority…………………………………….……..………
10.7
Assessment of Expenses……………………………….……….…….
10.8
Practice and Procedure……………………………..........…………...
10.9
Power of Market Integrity Officials……………………….……..…….
10.10
Report of Short Positions………………………………….……..…….
10.11
Audit Trail Requirements…………………………………..……..…....
10.12
Retention of Records and Instructions..……..…..…
10.13
Exchange and Provision of Information by Market Regulators …...
10.14
Synchronization of Clocks………………………….........……..……..
10.15
Assignment of Identifiers and Symbols………………….……..…….
10.16
Gatekeeper Obligations of Directors, Officers and Employees ofParticipants and Access Persons………..……..….……..….…..…...
10.17
Gatekeeper Obligations with Respect to Electronic Access….……
10.18
Gatekeeper Obligations with Respect to Access to Marketplaces
10.19
Reporting limits for listed derivatives…………………………………
PART 11 – ADMINISTRATION OF UMIR

7.12-1
7.13-1 – 7.13-5
7.14-1
8.1-1 – 8.1-5
9.1-1 – 9.1-2
10.1-1 – 10.1-4
10.2-1
10.3-1
10.4-1 – 10.4-2
10.5-1 – 10.5-3
10.6-1
10.7-1
10.8-1
10.9-1 – 10.9-3
10.10-1 – 10.10-2
10.11-1 – 10.11-3
10.12-1
10.13-1
10.14-1
10.15-1 – 10.15-2
10.16-1 – 10.16-3
10.17-1
10.18-1
10.19-1

11.1

General Exemptive Relief…………………………..........……..……. 11.1-1

11.2

General Prescriptive Power……………………………….……..…… 11.2-1

11.3

Review or Appeal of Market Regulator Decisions……...……..……. 11.3-1

11.4

Method of Giving Notice……………………………….……..……..… 11.4-1

11.5

Computation of Time……………………………………….……..….... 11.5-1

11.6

Waiver of Notice………………………………………….……..……… 11.6-1

11.7

Omissions or Errors in Giving Notice………………….……..…….... 11.7-1

11.8

Transitional Provisions………………….………………….……..…… 11.8-1

11.9

Non-Application of UMIR……………….………………….……..….... 11.9-1

11.10
11.11

Indemnification and Limited Liability of the Market Regulator….…. 11.10-1 – 11.10-2
Status of UMIR and Policies…………………………........................ 11.11-1

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PART 1 – DEFINITIONS AND INTERPRETATION
1.1

Definitions
In UMIR, unless the subject matter or context otherwise requires:
Defined Terms:

UMIR section 1.1 – “UMIR”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to section 1.1 that came into force on June 1, 2008 to
make editorial changes. See Footnote 1 in Status of Amendments.

“Acceptable Foreign Trade Reporting Facility” means a trade reporting facility or similar
facility outside Canada:
(a)
(b)
(c)

on which the reporting of trades is monitored for compliance with regulatory
requirements at the time of reporting by a self-regulatory organization that is amember of the International Organization of Securities Commissions;that displays and provides timely information of the price, volume and security
identifier of each trade at the time of the reporting of the trade; andIncluded on a list of acceptable foreign trade reporting facilities published on the
Corporation website.
Regulatory History:

Effective November 7, 2018, the applicable securities commissions approved amendments
to section 1.1 to add the definition of “Acceptable Foreign Trade Reporting Facility”. See
IIROC Notice 18-0154 – “Amendments Respecting the Reporting of Certain Trades to
Acceptable Foreign Trade Reporting Facilities” (August 9, 2018).

“Access Person” means a person other than a Participant who is:(a)a subscriber; or(b)a user.

Defined Terms:

NI 21-101 section 1.1 – “subscriber” and “user”
UMIR section 1.1 – “Participant”
UMIR section 1.2(2) – “person”“arbitrage account” means an account in which the holder makes a usual practice ofbuying and selling:(a)securities or derivatives in different markets to take advantage of differences inprices available in each market; or(b)securities or derivatives which are or may become convertible or exchangeable by
the terms of the securities or derivatives or operation of law into other securities inorder to take advantage of differences in prices between the securities or derivatives.

Defined Terms:

NI 21-101 section 1.4 – Interpretation - “security”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved amendments tosection 1.1 to amend the definition of “arbitrage account”. See IIROC Notice 22-0140–

UMIR section 1.1 – “derivative”

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Rules & Policies“Amendments Respecting the Trading of Derivatives on a Marketplace” (September 15,2022).

“Basis Order” means an order for the purchase or sale of:(a)listed securities or quoted securities that comprise at least 80% of the component
securities weighting of the underlying interest of:(i)a listed derivative; or(ii)

an Exempt Exchange-traded Fund,which will be executed at prices determined in a manner acceptable to a Market
Regulator that are based on the price achieved through the execution on that trading
day of one or more transactions in the derivative or Exempt Exchange-traded Fund;or(b)a listed derivative that is a listed or quoted security or an Exempt Exchange-traded
Fund, which will be executed at a price determined in a manner acceptable to aMarket Regulator that is based on the prices achieved through the execution on thattrading day of transactions in the securities that comprise at least 80% of thecomponent security weighting of the underlying interest of the derivative or Exempt
Exchange-traded Fund,

provided that prior to the entry of the order the Participant or Access Person reports to aMarket Regulator its intention to enter the order and the details of the related transactions,in the form and manner required by the Market Regulator.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “derivative”, “Exchange”, “listed derivative”, “listed
security”, “Market Regulator”, “Participant”, “QTRS”, “quoted security” and “trading day”

Regulatory History:

Effective April 8, 2005, the applicable securities commissions approved amendments tosection 1.1 to add the definition of “Basis Order”. See Market Integrity Notice 2005-010 –“Provisions Respecting a “Basis Order”” (April 8, 2005).
Effective April 30, 2015, the applicable securities commissions approved amendments tosection 1.1 to amend the definition of “Basis Order”. See Market Integrity Notice 15-0098 –“Amendments to the Definition of Basis Order” (April 30, 2015).
Effective December 14, 2022, the applicable securities commissions approved amendments
to section 1.1 to amend the definition of “Basis Order”. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September
15, 2022).

“basket trade” means a simultaneous purchase of at least 10 listed securities or quoted
securities, provided that any restricted security comprises not more than 20% of the total
value of the transaction.
Defined Terms:

UMIR section 1.1 – “listed security”, “quoted security” and “restricted security”

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments tosection 1.1 that came into force on May 9, 2005 to add the definition of “basket trade”. See
Market Integrity Notice 2005-007 – “Amendments Respecting Trading During Certain
Securities Transactions” (March 4, 2005).

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Rules & Policies“best ask price” means the lowest price of an order on:(a) any protected marketplace as displayed in a consolidated market display to sell aparticular security, or(b) an Exchange as displayed to sell a listed derivative,
but does not include the price of any order that is a Basis Order, Call Market Order, Closing
Price Order, Market-on-Close Order, Opening Order, Special Terms Order or VolumeWeighted Average Price Order.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Basis Order”, “Call Market Order”, “Closing Price Order”, “consolidated
market display”, “derivative”, “Exchange”, “listed derivative”, “Market-on-Close Order”,“marketplace”, “Opening Order”, “Special Terms Order” and “Volume-Weighted Average
Price Order”

Related Provision:

UMIR 1.2(8)Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment to
the definition of “best ask price”. See Market Integrity Notice 2007-002 – “Provisions
Respecting Competitive Marketplaces” (February 26, 2007).
Effective September 18, 2015, the applicable securities commissions approved anamendment to the definition of “best ask price”. See IIROC Notice 15-0211 - Notice ofApproval – “Provisions Respecting Unprotected Transparent Marketplaces and theOrder Protection Rule” (September 18, 2015).
Effective December 14, 2022, the applicable securities commissions approved amendments
to section 1.1 to amend the definition of “best ask price”. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September
15, 2022).

“best bid price” means the highest price of an order on:(a) any protected marketplace as displayed in a consolidated market display to buy aparticular security, or(b) an Exchange as displayed to buy a listed derivative,
but does not include the price of any order that is a Basis Order, Call Market Order, Closing
Price Order, Market-on-Close Order, Opening Order, Special Terms Order or VolumeWeighted Average Price Order.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Basis Order”, “Call Market Order”, “Closing Price Order”, “consolidated
market display”, “derivative”, “Exchange”, “listed derivative”, “Market-on-Close Order”,“marketplace”, “Opening Order”, “Special Terms Order” and “Volume-Weighted Average
Price Order”

Related Provision:

UMIR 1.2(8)Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment to
the definition of “best ask price”. See Market Integrity Notice 2007-002 – “Provisions
Respecting Competitive Marketplaces” (February 26, 2007).
Effective September 18, 2015, the applicable securities commissions approved anamendment to the definition of “best bid price”. See IIROC Notice 15-0211 - Notice ofPart 1 - Definitions and Interpretation
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Approval – “Provisions Respecting Unprotected Transparent Marketplaces and theOrder Protection Rule” (September 18, 2015).
Effective December 14, 2022, the applicable securities commissions approved amendments
to section 1.1 to amend the definition of “best bid price”. See IIROC Notice 22-0140 –“Amendments Respecting the Trading of Derivatives on a Marketplace” (September
15, 2022).

“best independent bid price” means the best bid price, other than for an order that a
dealer-restricted person knows or ought reasonably to know has been entered by or on
behalf of a person that is a dealer-restricted person or an issuer-restricted person.
Defined Terms:

NI 21-101 section 1.1 – “order”
UMIR section 1.1 – “best bid price”, “dealer-restricted person” and “issuer-restricted person”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective January 8, 2010, the applicable securities commissions approved amendments tosection 1.1 to add the definition of “best independent bid price”. See IIROC Notice 10-0006– “Provisions Respecting Trading During Certain Securities Transactions” (January
8, 2010).

“better price” means, in respect of each trade resulting from an order for a particular
security:(a)in the case of a purchase, a price that is at least one trading increment lower thanthe best ask price at the time of the entry of the order to a marketplace provided that,
if the best bid price is one trading increment lower than the best ask price, the priceshall be at least one-half of one trading increment lower; and(b)in the case of a sale, a price that is at least one trading increment higher than thebest bid price at the time of the entry of the order to a marketplace provided that, if
the best ask price is one trading increment higher than the best bid price, the priceshall be at least one-half of one trading increment higher.

Defined Terms:

NI 21-101 section 1.1 - “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “best ask price”, “best bid price”, “marketplace” and “trading increment”
UMIR section 1.2(2) – “trade”

Regulatory History:

On April 13, 2012, the applicable securities commissions approved an amendment to section
1.1, effective October 15, 2012, to delete and substitute the definition of “better price”. See
IIROC Notice 12-0130 – “Provisions Respecting Dark Liquidity” (April 13, 2012).

“Board” means the board of directors or other governing body of a Market Regulator.
Defined Terms:

UMIR section 1.1 – “Market Regulator”“bundled order” means an order that includes a client order as well as a non-client order
or principal order, or both.
Defined Terms:

NI 21-101 section 1.1 – “order”
UMIR section 1.1 – “client order”, “non-client order” and “principal order”

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Regulatory History:

Effective September 14, 2017, the applicable securities commissions approved anamendment to section 1.1 to add the definition of “bundled order”. See IIROC Notice 170039 – Notice of Approval – “Amendments Respecting Designations and Identifiers”(February 16, 2017).

“bypass order” means an order in a listed security that is:(a)part of a designated trade; or(b)

to satisfy an obligation to fill an order imposed on a Participant or Access Person by
any provision of UMIR or a Policy

and that is entered on:(c)(d)

a protected marketplace to execute as against the disclosed volume on thatmarketplace prior to the execution or cancellation of the balance of the order; ora marketplace that is not a protected marketplace but that displays orders in aconsolidated market display, to execute as against the displayed orders on thatmarketplace that would have been included in the disclosed volume if thatmarketplace had been a protected marketplace.

Defined Terms:

NI 21-101 section 1.1 - “order”
UMIR section 1.1 – “Access Person”, “designated trade”, “disclosed volume”, “listed
security” “marketplace”, “Participant”, “Policy”, “protected marketplace” and “UMIR”

Regulatory History:

Effective May 16, 2008, the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “bypass order”.
In connection with the recognition of IIROC and its adoption of UMIR, the applicablesecurities commissions approved an amendment to section 1.1 that came into force on June
1, 2008 to make editorial changes. See Footnote 1 in Status of Amendments.
Effective September 18, 2015, the applicable securities commissions approved anamendment to the definition of “bypass order”. See IIROC Notice 15-0211 - Notice ofApproval – “Provisions Respecting Unprotected Transparent Marketplaces and theOrder Protection Rule” (September 18, 2015).
Effective December 14, 2022, the applicable securities commissions approved amendments
to section 1.1 to amend the definition of “bypass order”. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September
15, 2022).

“Canadian account” means an account other than a non-Canadian account.
Defined Terms:

UMIR section 1.1 – “non-Canadian account”

Regulatory History:

Effective May 16, 2008, the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “Canadian account”. See Market Integrity Notice 2008008 – “Provisions Respecting “Off-Marketplace” Trades” (May 16, 2008).

“Call Market Order” means an order for the purchase or sale of one or more particular
securities that is entered on a marketplace on a trading day to trade at a particular time ortimes established by the marketplace during that trading day at a price established by the
trading system of the marketplace.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”

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UMIR section 1.1 – “marketplace” and ”trading day”

“client order” means an order for the purchase or sale of a security or a derivative
received or originated by a Participant for the account of:(a) a client of the Participant or(b) a client of an affiliated entity of the Participant,but does not include a principal order or a non-client order.
Defined Terms:

NI 21-101 section 1.1 - “order”
NI 21-101 section 1.3(1) – “affiliated entity”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “derivative”, “Participant”, “principal order” and “non-client order”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved amendments
to section 1.1 to amend the definition of “client order”. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September
15, 2022).

“Closing Price Order” means an order for the purchase or sale of a listed security or aquoted security entered on a marketplace and subject to the conditions that the order tradeat the closing sale price of that security on that marketplace for that trading day and thatthe trade is executed subsequent to the establishment of the closing price.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “listed security”, “marketplace”, “quoted security” and “trading day”
UMIR section 1.2(2) – “trade”

Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “Closing Price Order”. See Market Integrity Notice 2007-002– “Provisions Respecting Competitive Marketplaces” (February 26, 2007).

“connected security” means, in respect of an offered security:(a)a listed security or quoted security into which the offered security is immediately
convertible, exchangeable or exercisable unless the price at which the offeredsecurity is convertible, exchangeable or exercisable is greater than 110% of the best
ask price of the listed security or quoted security at the commencement of therestricted period;(b)a listed security or quoted security of the issuer of the offered security or anotherissuer that, according to the terms of the offered security, may significantly determine
the value of the offered security;(c)

if the offered security is a special warrant, a listed security or quoted security which
would be issued on the exercise of the special warrant; or(d)if the offered security is an equity security, any other equity security of the issuer thatis a listed security or quoted security.

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Defined Terms:

UMIR section 1.1 – “best ask price”, “equity security”, “listed security”, “offered security”,“quoted security” and “restricted period”

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments tosection 1.1 that came into force on May 9, 2005 to add the definition of “connected security”.
See Market Integrity Notice 2005-007 – “Amendments Respecting Trading During Certain
Securities Transactions” (March 4, 2005).
Effective January 8, 2010, the applicable securities commissions approved amendments tosection 1.1 to amend the definition of “connected security”. See IIROC Notice 10-0006 –“Provisions Respecting Trading During Certain Securities Transactions” (January 8,2010).

“consolidated market display” means, in respect of a particular security, information onorders or trades from each marketplace on which such particular security trades that has
been:
(a)

produced by an information processor in a timely manner in accordance with Part
14 of the Marketplace Operation Instrument; or(b)

if there is no information processor, produced by an information vendor inaccordance with Part 7 of the Marketplace Operation Instrument.

Defined Terms:

NI 21-101 section 1.1 – “information processor” and “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “marketplace” and “Market Operation Instrument”
UMIR section 1.2(2) – “trade”

Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment tosection 1.1 to replace the definition of “consolidated market display”. See Market Integrity
Notice 2007-002 – “Provisions Respecting Competitive Marketplaces” (February 26,2007).

“Dark Order” means:(a) an order no portion of which is displayed on entry on a marketplace in a consolidated
market display; or(b) that portion of an order which on entry to a marketplace is not displayed in aconsolidated market display if that portion may trade at a price other than the pricedisplayed by that portion of the order included in the consolidated market display
but does not include an order entered on a marketplace as:(c) part of an intentional cross;(d) a market order that is immediately executed in full on one or more marketplaces at
the time of entry;(e) a limit order that is immediately executed in full on one or more marketplaces at thetime of entry;(f) a Basis Order;

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Rules & Policies(g) a Call Market Order if that Call Market Order may only trade with other Call Market
Orders and the matching of Call Market Orders occurs less frequently than once every
minute;(h) a Closing Price Order;(i)a Market-on-Close Order;(j)an Opening Order; or(k) a Volume-Weighted Average Price Order.
Defined Terms:

NI 21-101 section 1.1 - “order”
UMIR section 1.1 – “Basis Order”, “Call Market Order”, “Closing Price Order”, “consolidated
market display”, “intentional cross”, “limit order”, “Market-on-Close Order”, “market order”,“marketplace”, “Opening Order” and “Volume-Weighted Average Price Order”

Regulatory History:

On April 12, 2012, the applicable securities commissions approved an amendment to section
1.1, effective October 15, 2012, to add the definition of “Dark Order”. See IIROC Notice 120130 – “Provisions Respecting Dark Liquidity” (April 13, 2012).

"dealer-restricted person" means, in respect of a particular offered security:(a)a Participant that:(i)is an underwriter, as defined in applicable securities legislation, in a prospectus
distribution or a restricted private placement,(ii)

is participating, as agent but not as an underwriter, in a restricted private
placement of securities and the Participant has been allotted or is otherwise
entitled to sell more than 25% of the securities to be issued under the restrictedprivate placement,(iii)

has been appointed by an offeror to be the dealer-manager, manager orsoliciting dealer or adviser in respect of a securities exchange take-over bid or
issuer bid, or(iv)

has been appointed by an issuer to be the soliciting dealer or adviser in respectof obtaining security holder approval for an amalgamation, arrangement,
capital reorganization or similar transaction that would result in the issuance of
securities that would be a distribution exempt from prospectus requirements inaccordance with applicable securities law,where, in each case, adviser means an adviser whose compensation depends on
the outcome of the transaction;(b)a related entity of the Participant referred to in clause (a) but does not include such
related entity, or any separate and distinct department or division of the Participant
if:(i)the Participant maintains and enforces written policies and procedures inaccordance with Rule 7.1 that are reasonably designed to prevent the flow of
information from the Participant regarding the offered security and the relatedtransaction,

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Rules & Policies(ii)

the Participant has no officers or employees that solicit client orders or
recommend transactions in securities in common with the related entity,
department or division, and(iii)

the related entity, department or division does not during the restricted period
in connection with the restricted security:(A)

act as a market maker (other than pursuant to Marketplace Trading
Obligations),(B)

solicit client orders, or(C)enter principal orders or otherwise engage in proprietary trading;(c)a partner, director, officer, employee or a person holding a similar position or acting
in a similar capacity, of the Participant referred to in clause (a) or for a related entityof the Participant referred to in clause (b); or(d)any person acting jointly or in concert with a person described in clause (a), (b) or(c) for a particular transaction.

Defined Terms:

NI 14-101 section 1.1(3) – “issuer bid” and “securities legislation”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “client order”, “employee”, “Marketplace Trading Obligations”, “offeredsecurity”, “Participant”, “principal order”, “related entity”, “restricted period”, “restricted private
placement” and “securities exchange take-over bid”
UMIR section 1.2(2) – “person”

Related Provision:

UMIR Policy 1.2 Part 1 – “acting jointly or in concert”

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments tosection 1.1 that came into force on May 9, 2005 to add the definition of “dealer-restrictedperson”. See Market Integrity Notice 2005-007 – “Amendments Respecting Trading During
Certain Securities Transactions” (March 4, 2005).
Effective January 8, 2010, the applicable securities commissions approved amendments tosection 1.1 to amend the definition of “dealer-restricted person” to replace sub-clause (a)(ii) of
the definition. See IIROC Notice 10-0006 – “Provisions Respecting Trading During Certain
Securities Transactions” (January 8, 2010).
Effective August 26, 2011, the applicable securities commissions approved amendments tosection 1.1 to replace the reference in the definition of “dealer-restricted person“ to “Market
Maker Obligations” with “Marketplace Trading Obligations”. See IIROC Notice 11-0251 –“Provisions Respecting Market Maker, Odd Lot and Other Marketplace Trading
Obligations” (August 26, 2011).

“derivative” means an option, swap, futures contract, forward contract, contract fordifference or any other financial or commodity contract or instrument whose market price,
value, delivery obligations, payment obligations or settlement obligations are derived from,referenced to or based on an underlying interest, including a value, price, rate, variable,
index, event, probability or thing.
Related Provision :UMIR section 1.1 – “listed derivative”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved amendments
to section 1.1 to add the definition of “derivative”. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September
15, 2022).

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Rules & Policies“derivatives market maker” means a person who performs Marketplace Trading
Obligations or other functions ordinarily associated with a market maker or specialist on
an Exchange or QTRS in connection with a listed derivative.
Defined Terms:

UMIR section 1.1 – “derivative, “Exchange”, “listed derivative”, “Marketplace Trading
Obligations” and “QTRS”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved
amendments to section 1.1 to amend the definition of “derivatives market maker”. See
IIROC Notice 22-0140 – “Amendments Respecting the Trading of Derivatives on aMarketplace” (September 15, 2022).

“derivative-related cross” means a pre-arranged trade resulting from an order enteredon a marketplace by a Participant or Access Person for a particular security that is fully
offset by a trade in a related derivative.
Defined Terms:

NI 21-101 section 1.1 – “marketplace”, “order”
UMIR section 1.1 – “Access Person”, “derivative”, ”marketplace”, “Participant”, “prearranged trade”, “related derivative” and “related security”

Regulatory History:

Effective September 14, 2017, the applicable securities commissions approved anamendment to section 1.1 to add the definition of “derivative-related cross”. See IIROC
Notice 17-0039 – Notice of Approval – “Amendments Respecting Designations and
Identifiers” (February 16, 2017).
Effective December 14, 2022, the applicable securities commissions approved
amendments to section 1.1 to amend the definition of “derivatives-related cross”. See
IIROC Notice 22-0140– “Amendments Respecting the Trading of Derivatives on aMarketplace” (September 15, 2022).

“designated trade” means an intentional cross or a pre-arranged trade of a security thatwould be made at a price that:
(a)

(b)

would not be less than the lesser of:(i)
95% of the best bid price, and(ii) 10 trading increments less than the best bid price; andwould not be more than the greater of:(i)105% of the best ask price, and(ii) 10 trading increments more than the best ask price.

Defined Terms:

NI 21-101 section 1.4 – Interpretation - “security”
UMIR section 1.1 – “best ask price”, “best bid price”, “intentional cross”, “pre-arranged trade”
and “trading increment”

Regulatory History:

Part 1 - Definitions and Interpretation
May 27, 2024

Effective May 16, 2008, the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “designated trade”. See Market Integrity Notice 2008-008 –“Provisions Respecting “Off-Marketplace” Trades” (May 16, 2008).

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Rules & Policies“direct electronic access” means an arrangement between a Participant that is amember, user or subscriber and a client that permits the client to electronically transmit
an order relating to a security or a derivative containing the identifier of the Participant:(a)through the systems of the Participant for automatic onward transmission to amarketplace; or(b)directly to a marketplace without being electronically transmitted through thesystems of the Participant.

Defined Terms:

NI 21-101 section 1.1 – “member”, “subscriber” and “user”
NI 21-101 section 1.4 – Interpretation – “security”
UMIR section 1.1 – “derivative”, “marketplace” and “Participant”

Regulatory History:

On July 4, 2013, the applicable securities commissions approved an amendment to section
1.1, effective March 1, 2014, to add the definition of “direct electronic access”. See IIROC
Notice 13-0184 – “Provisions Respecting Third-Party Electronic Access toMarketplaces” (July 4, 2013).
Effective December 14, 2022, the applicable securities commissions approved amendments
to section 1.1 to amend the definition of “direct electronic access”. See IIROC Notice 220140 – “Amendments Respecting the Trading of Derivatives on a Marketplace”(September 15, 2022).

“disclosed volume” means the aggregate of the number of units of a security relating toeach order for that security entered on a protected marketplace and displayed in aconsolidated market display that is offered at a price below the intended price of a tradein the case of a purchase or that is bid at a price above the intended price of a trade in thecase of a sale, but does not include the volume of:(a)a Basis Order;(b)

a Call Market Order;(c)a Market-on-Close Order;(d)an Opening Order;(e)a Special Terms Order; or(f)a Volume-Weighted Average Price Order.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Basis Order”, “Call Market Order”, “consolidated market display”, “Marketon-Close Order”, “Opening Order”, “protected marketplace”, “Special Terms Order” and“Volume-Weighted Average Price Order”
UMIR section 1.2 – “trade”

Regulatory History:

Effective May 16, 2008, the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “disclosed volume”. See Market Integrity Notice 2008-008 –“Provisions Respecting “Off-Marketplace” Trades” (May 16, 2008).

“document” includes a sound recording, videotape, film, photograph, chart, graph, map,plan, survey, book of account, and information recorded or stored by means of any device.

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Regulatory History:

Effective March 11, 2005, the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “document”. See Market Integrity Notice 2005-008 –“Provision Respecting Impeding or Obstructing a Market Regulator” (March 11, 2005).
In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to section 1.1 that came into force on June 1, 2008 to
make editorial changes. See Footnote 1 in Status of Amendments.

“Electronic Trading Rules” means National Instrument 23-103 Electronic Trading as
amended, supplemented, and in effect from time to time.
Regulatory History:

Effective March 1, 2013 the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “Electronic Trading Rules”. See IIROC Notice 12-0363 –“Provisions Respecting Electronic Trading” (December 7, 2012).

“employee” includes any person who has entered into principal/agent relationship with a
Participant in accordance with the terms and conditions established for such a relationshipby any self-regulatory entity of which the Participant is a member.
Defined Terms:

NI 21-101 section 1.1 – “self-regulatory entity”
UMIR section 1.1 – “Participant”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective May 16, 2003, the applicable securities commissions approved the amendment to add
the definition of “employee”. See Market Integrity Notice 2003-012 – “Definition of“Employee”” (June 11, 2003).

“equity security” means any security of an issuer that carries a residual right toparticipate in the earnings of the issuer and, upon liquidation or winding-up of the issuer,in its assets.
Defined Terms:

NI 21-101 section 1.4 – Interpretation -- “security”

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments tosection 1.1 that came into force on May 9, 2005 to add the definition of “equity security”. See
Market Integrity Notice 2005-007 – “Amendments Respecting Trading During Certain
Securities Transactions” (March 4, 2005).

“Exchange” means a person recognized by the applicable securities regulatory authority
under securities legislation to carry on business as an exchange.
Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation” and “securities regulatory authority”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective December 9, 2013, the applicable securities commissions approved amendments to
the French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French
version of UMIR” (December 9, 2013).

“Exchange-traded Fund” – repealed
Regulatory History:

Part 1 - Definitions and Interpretation
May 27, 2024

Effective January 8, 2010, the applicable securities commissions approved amendments tosection 1.1 to repeal the definition of “Exchange-traded Fund”. See IIROC Notice 10-0006 –UMIR 1.1-12

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Rules & Policies“Provisions Respecting Trading During Certain Securities Transactions” (January 8,2010).

“Exempt Exchange-traded Fund” means a mutual fund for the purposes the purposesof applicable securities legislation, the units of which:(a)are a listed security or a quoted security; and(b)

are in continuous distribution in accordance with applicable securities legislation but
does not include a mutual fund that has been designated by the Market Regulator
to be excluded from this definition.

Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
UMIR section 1.1 – “listed security”, “Market Regulator” and “quoted security”

Related Provision:

UMIR Policy 1.1, Part 2 – Definition of ‘’Exempt Exchange-traded Fund’’Regulatory History:

Effective January 8, 2010, the applicable securities commissions approved amendments tosection 1.1 to add the definition of “Exempt Exchange-traded Fund”. See IIROC Notice 10-0006– “Provisions Respecting Trading During Certain Securities Transactions” (January 8,2010).
Effective December 9, 2013, the applicable securities commissions approved amendments to
the French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French
version of UMIR” (December 9, 2013).

General Commentary:

A current list of the securities which have been designated as being excluded from the definitionof an “Exempt Exchange-traded Fund” is available on the website of the Investment Industry
Regulatory Organization of Canada.

“failed trade” means a trade resulting from the execution of an order entered by aParticipant or Access Person on a marketplace on behalf of an account and(a) in the case of a sale, other than a short sale, the account failed to make available
securities in such number and form;(b)in the case of a short sale, the account failed to make:(i)available securities in such number and form, or(ii)arrangements with the Participant or Access Person to borrow securities insuch number and form; and(c)in the case of a purchase, the account failed to make available monies in suchamount,as to permit the settlement of the trade at the time on the date contemplated on theexecution of the trade provided a trade shall be considered a “failed trade” irrespective ofwhether the trade has been settled in accordance with the rules or requirements of theclearing agency.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “marketplace”, “Participant” and “short sale”
UMIR section 1.2 – “trade”

Guidance:

See IIROC Notice 22-0130 – “Guidance on Participant Obligations to have Reasonable
Expectation to Settle any Trade Resulting from the Entry of a Short Sale Order” (AugustPart 1 - Definitions and Interpretation
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17, 2022)
Regulatory History:

On October 15, 2008, the applicable securities commissions approved amendments to section
1.1 that came into force on October 14, 2008 to add the definition of “failed trade”. See IIROC
Notice 08-0143 – “Provisions Respecting Short Selling and Failed trades” (October 15,2008).

“foreign dealer equivalent” means a person in the business of trading securities orderivatives in a foreign jurisdiction in a manner analogous to an investment dealer andthat is subject to the regulatory jurisdiction of a signatory to the International Organizationof Securities Commissions’ Multilateral Memorandum of Understanding in that foreign
jurisdiction.
Defined Terms:

NI 14-101 section 1.1(3) – “jurisdiction”
NI 21-101 section 1.4 – Interpretation – “security”
NI 31-103 section 1.1 – “investment dealer”
UMIR section 1.2(2) – “person”
UMIR section 1.1 – “derivative”

Regulatory History:

On July 4, 2013, the applicable securities commissions approved amendments to section
1.1 to add the definition “foreign dealer equivalent”, effective March 1, 2014. See Notice 130184 – Provisions Respecting Third-Party Electronic Access to Marketplaces (July 4,2013). Effective December 14, 2022, the applicable securities commissions approved
amendments to section 1.1 to amend the definition of “foreign dealer equivalent”. See IIROC
Notice 22-0140 – “Amendments Respecting the Trading of Derivatives on aMarketplace” (September 15, 2022).

“foreign organized regulated market” means a market outside of Canada:(a)that is an exchange, quotation or trade reporting system, alternative trading system
or similar facility recognized by or registered with a securities regulatory authoritythat is an ordinary member of the International Organization of Securities
Commissions;(b)on which the entry of orders and the execution or reporting of trades is monitored
for compliance with regulatory requirements at the time of entry and execution orreporting by a self-regulatory organization recognized by the securities regulatory
authority or by the market if the market has been empowered by the securities
regulatory authority to monitor the entry of orders and the execution or reporting oftrades on that market for compliance with regulatory requirements; and(c)that displays and provides timely information to information vendors, information
processors or persons providing similar functions respecting the dissemination ofdata to market participants for that market of at least the price, volume and security
identifier of each trade at the time of execution or reporting of the trade on thatmarket,but, for greater certainty, does not include a facility of a market to which trades executed
over-the-counter are reported unless:Part 1 - Definitions and Interpretation
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Rules & Policies(d)the trade is required to be reported and is reported to the market forthwith following
execution;(e)at the time of the report, the trade is monitored for compliance with securities
regulatory requirements; and(f)at the time of the report, timely information respecting the trade is provided to
information vendors, information processors or persons providing similar functions
respecting the dissemination of data to market participants for that market.

Defined Terms:

NI 14-101 section 1.1(3) – “securities regulatory authority”
NI 21-101 section 1.1 – “alternative trading system”, “information processor” and “order”
UMIR section 1.2 – “person” and “trade”

Regulatory History:

Effective May 16, 2008, the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “foreign organized regulated market”. See Market Integrity
Notice 2008-008 – “Provisions Respecting “Off-Marketplace” Trades” (May 16, 2008).

Guidance:

See IIROC Notice 14-0293 – “Guidance on the Definition of “Foreign Organized RegulatedMarket” (December 15, 2014).

“Global Legal Entity Identifier System" means the system for unique identification ofparties to financial transactions developed by the Legal Entity Identifier System
Regulatory Oversight Committee.
Defined Term:

UMIR section 1.1 – “Legal Entity Identifier System Regulatory Oversight Committee”

Related Provision:

UMIR section 6.2

Regulatory History:

Effective July 26, 2021, the applicable securities commissions approved amendments tosections 1.1, 6.2, 7.13 and 10.15 to add identifier and/or designation requirements for clientson orders sent to a marketplace. See IIROC Notice 19-0071 – “Amendments Respecting
Client Identifiers” (April 18, 2019).

“hearing” – repealed
Defined Terms:

UMIR section 1.1 – “Market Regulator” and “Requirements”

Regulatory History:

Effective September 1, 2016, the applicable securities commissions approved anamendment to section 1.1 to repeal the definition of “hearing”. See IIROC Notice 16-0122– “Implementation of the consolidated IIROC Enforcement, Examination andApproval Rules” (June 9, 2016).

UMIR section 1.2(2) – “person”“Hearing Committee” – repealed
Defined Terms:

UMIR section 1.1 – “Market Regulator”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicablesecurities commissions approved an amendment to the definition of Hearing Committee thatcame into force on June 1, 2008 to make editorial changes. See Footnote 1 in Status ofAmendments.
Effective September 1, 2016, the applicable securities commissions approved anamendment to section 1.1 to repeal the definition of “Hearing Committee”. See IIROC Notice
16-0122 – “Implementation of the consolidated IIROC Enforcement, Examination andApproval Rules” (June 9, 2016).

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Rules & Policies

Related Provisions:

Schedule C.1 to Transition Rule 1 of the Investment Industry Regulatory Organization of
Canada“Hearing Panel” – repealed
Defined Terms:

UMIR section 1.1 – “Hearing Committee”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicablesecurities commissions approved an amendment to the definition of Hearing Panel thatcame into force on June 1, 2008 to make editorial changes. See Footnote 1 in Status ofAmendments.
Effective September 1, 2016, the applicable securities commissions approved anamendment to section 1.1 to repeal the definition of “Hearing Panel”. See IIROC Notice 160122 – “Implementation of the consolidated IIROC Enforcement, Examination andApproval Rules” (June 9, 2016).

Related Provisions:

Schedule C.1 to Transition Rule 1 of the Investment Industry Regulatory Organization of
Canada“hedge” means the purchase or sale of a security by a person to offset, in whole or inpart, the risk assumed on a prior purchase or sale or to be assumed on a subsequentpurchase or sale of that security or a related security.
Defined Terms:

NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “related security”
UMIR section 1.2(2) – “person”“highly-liquid security” means a listed security or quoted security that:
(a)

(b)

has traded, in total, on one or more marketplaces as reported on a consolidated
market display during a 60-day period ending not earlier than 10 days prior to thecommencement of the restricted period:(i)an average of at least 100 times per trading day, and(ii) with an average trading value of at least $1,000,000 per trading day; oris subject to Regulation M under the 1934 Act and is considered to be an “activelytraded security” under that regulation.

Defined Terms:

NI 14-101 section 1.1 – “1934 Act”
UMIR section 1.1 – “consolidated market display”, “listed security”, “marketplace”, “quoted
security”, “restricted period” and “trading day”

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments tosection 1.1 that came into force on May 9, 2005 to add the definition of “highly-liquid security”.
See Market Integrity Notice 2005-007 – “Amendments Respecting Trading During Certain
Securities Transactions” (March 4, 2005).

General Commentary:

A list of the securities which on any particular trading day qualify as a “highly-liquid security” isavailable on the website of the Investment Industry Regulatory Organization of Canada.

“identified order execution only client” means a client using an order execution only
service:

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Rules & Policies(a) whose trading activity on marketplaces for which the Market Regulator is theregulation services provider exceeds a daily average of 500 orders per trading day in
any calendar month,(b) that is not an individual and is registered as a dealer or adviser in accordance withapplicable securities legislation, or(c) that is not an individual and is in the business of trading securities or derivatives ina foreign jurisdiction in a manner analogous to a dealer or adviser.
Defined Terms:

NI 21-101 section 1.1 – “order”, “regulation services provider”
NI 21-101 section 1.4 – Interpretation -- “security”
NI 14-101 section 1.1(3) – “jurisdiction” and “securities legislation”
UMIR section 1.1 – “derivative”, “Market Regulator”, “marketplace”, “order execution service”,“trading day”

Regulatory History:

Effective July 26, 2021, the applicable securities commissions approved amendments tosections 1.1, 6.2, 7.13 and 10.15 to add identifier and/or designation requirements for clients onorders sent to a marketplace. See IIROC Notice 19-0071 – “Amendments Respecting Client
Identifiers” (April 18, 2019).
Effective December 14, 2022, the applicable securities commissions approved amendments tosection 1.1 to amend the definition of “identified order execution only client”. See IIROC Notice22-0140– “Amendments Respecting the Trading of Derivatives on a Marketplace”(September 15, 2022).

“insider” means a person who is an insider of an issuer for the purpose of applicablesecurities legislation.
Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French version of
UMIR” (December 9, 2013).

“intentional cross” means a trade resulting from the entry by a Participant or Access
Person of both the order to purchase and the order to sell a security, but does not include
a trade in which the Participant has entered one of the orders as a jitney order.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “Participant” and “jitney order”
UMIR section 1.2(2) – “trade”

Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment to
the definition of “intentional cross” in section 1.1 to insert the phrase “or Access Person”
after the first occurrence of the word “Participant”. See Market Integrity Notice 2007-002 –“Provisions Respecting Competitive Marketplaces” (February 26, 2007).

“internal cross” means an intentional cross between two accounts in a security which
are managed by a single firm acting as a portfolio manager with discretionary authority to
manage the investment portfolio granted by each of the holders of the accounts andPart 1 - Definitions and Interpretation
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includes a trade in respect of which the Participant or Access Person is acting as a portfolio
manager in authorizing the trade between the two accounts.
Defined Terms:

NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “intentional cross” and “Participant”
UMIR section 1.2(2) – “trade”

Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment tosection 1.1 to replace the definition of “internal cross”. See Market Integrity Notice 2007-002 –“Provisions Respecting Competitive Marketplaces” (February 26, 2007).
Effective December 14, 2022, the applicable securities commissions approved amendments tosection 1.1 to amend the definition of “internal cross”. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September 15,2022).

“issuer-restricted person” means, in respect of a particular offered security:(a)the issuer of the offered security;(b)a selling security holder of the offered security in connection with a prospectus
distribution or restricted private placement;(c)an affiliated entity, an associated entity or insider of the issuer or selling security
holder of the offered security as determined in accordance with the provisions ofapplicable securities legislation but does not include a person who is an insider of
an issuer by virtue of clause (c) of the definition of “insider” under the Securities
Act (Ontario) and similar provisions of applicable securities legislation if that
person:(d)(i) does not have, and has not had in the previous 12 months, any board ormanagement representation in respect of the issuer or selling security holder;and(ii) does not have knowledge of any material information concerning the issuer or
its securities that has not been generally disclosed; orany person acting jointly or in concert with a person described in clause (a), (b) or(c) for a particular transaction.

Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
N1 21-101 section 1.3(1) – “affiliated entity”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “insider”, “offered security” and “restricted private placement”
UMIR section 1.2(2) – “person”

Related Provisions:

UMIR section 1.2(7) – interpretation of “associated entity”
UMIR Policy 1.2 Part 1 – interpretation of “acting jointly or in concert”

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments tosection 1.1 that came into force on May 9, 2005 to add the definition of “issuer-restrictedperson”. See Market Integrity Notice 2005-007 – “Amendments Respecting Trading During
Certain Securities Transactions” (March 4, 2005).

“jitney order” means an order entered on a marketplace by a Participant acting for or on
behalf of another Participant.

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Defined Terms:

NI 21-101 section 1.1 – “order”
UMIR section 1.1 – “marketplace” and “Participant”“last independent sale price” – repealed
Regulatory History:

Effective January 8, 2010, the applicable securities commissions approved amendments tosection 1.1 to repeal the definition of “last independent sale price”. See IIROC Notice 10-0006– “Provisions Respecting Trading During Certain Securities Transactions” (January 8,2010).

“last sale price” means the price of the last sale of at least one standard trading unit of:(a) a particular security displayed in a consolidated market display but does not include
the price of a sale resulting from an order that is:(i) a Basis Order;(ii) a Call Market Order;(iii) a Closing Price Order;(iv) a Special Terms Order unless the Special Terms Order has executed withan order or orders other than a Special Terms Order; or(v) a Volume-Weighted Average Price Order,(b) a particular option traded on an Exchange.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Basis Order”, “Call Market Order”, “Closing Price Order”, “consolidated
market display”, “Exchange”, “Special Terms Order”, “standard trading unit” and “VolumeWeighted Average Price Order”

Related Provision:

UMIR section 1.2(4)Regulatory History:

Effective April 8, 2005, the applicable securities commissions approved an amendment to
the definition of “last sale price” in section 1.1 to delete the phrase “Call Market Order” andsubstitute “Basis Order, Call Market Order or Volume-Weighted Average Price Order”. See
Market Integrity Notice 2005-010 – “Provisions Respecting a “Basis Order”” (April 8,2005).
Effective March 9, 2007, the applicable securities commissions approved an amendment tosection 1.1 to replace the definition of “last sale price”. See Market Integrity Notice 2007002 – “Provisions Respecting Competitive Marketplaces” (February 26, 2007).
Effective December 14, 2022, the applicable securities commissions approved amendments
to section 1.1 to amend the definition of “last sale price”. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September
15, 2022).

“Legal Entity Identifier” means a unique identification code assigned to a person inaccordance with standards set by the Global Legal Entity Identifier System.
Defined Terms:

UMIR section 1.2(2) – “person”
UMIR section 1.1 – “Global Legal Entity Identifier System”

Related Provision:

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Regulatory History:

Effective July 26, 2021, the applicable securities commissions approved amendments tosections 1.1, 6.2, 7.13 and 10.15 to add identifier and/or designation requirements for clientson orders sent to a marketplace. See IIROC Notice 19-0071 – “Amendments Respecting
Client Identifiers” (April 18, 2019).

"Legal Entity Identifier System Regulatory Oversight Committee" means theinternational working group established by the Finance Ministers and the Central Bank
Governors of the Group of Twenty nations and the Financial Stability Board, under theCharter of the Regulatory Oversight Committee for the Global Legal Entity Identifier
System dated November 5, 2012.
Defined Terms:

UMIR section 1.1 – “Global Legal Entity Identifier System”, “Legal Entity Identifier”

Related Provision:

UMIR section 6.2

Regulatory History:

Effective July 26, 2021, the applicable securities commissions approved amendments tosections 1.1, 6.2, 7.13 and 10.15 to add identifier and/or designation requirements for clientson orders sent to a marketplace. See IIROC Notice 19-0071 – “Amendments Respecting
Client Identifiers” (April 18, 2019).

“limit order” means an order to:(a)

buy a security or derivative to be executed at a specified maximum price; or(b)sell a security or derivative to be executed at a specified minimum price.

Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “derivative”

Related Provisions:

UMIR section 1.2(3)Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved amendments tosection 1.1 to amend the definition of “limit order”. See IIROC Notice 22-0140– “Amendments
Respecting the Trading of Derivatives on a Marketplace” (September 15, 2022).

“listed derivative” means a derivative that is traded on a marketplace pursuant tostandardized terms and conditions set out by that marketplace and whose trades arecleared and settled by a clearing agency.
Defined Terms:

UMIR section 1.1 – “derivative” and “marketplace”

Related Provision:

UMIR section 1.2(2) – “trade”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved amendments tosection 1.1 to add the definition of “listed derivative”. See IIROC Notice 22-0140 –“Amendments Respecting the Trading of Derivatives on a Marketplace” (September 15,2022).

“listed security” means a security listed on an Exchange.
Defined Terms:

UMIR section 1.1 – “Exchange”
NI 21-101 section 1.4 – Interpretation -- “security”

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Rules & Policies“Market Integrity Official” means an employee of a Market Regulator designated by theMarket Regulator to exercise the powers of the Market Regulator under UMIR.
Defined Terms:

UMIR section 1.1 – “Market Regulator” and “UMIR”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicablesecurities commissions approved an amendment to section 1.1 that came into force on June
1, 2008 to make editorial changes. See Footnote 1 in Status of Amendments .

“Market Maker Obligations” – repealed
Regulatory History:

Effective August 26, 2011, the applicable securities commissions approved amendments tosection 1.1 to replace the definition of “Market Maker Obligations” with the definition of“Marketplace Trading Obligations”. See IIROC Notice 11-0251 – “Provisions Respecting
Market Maker, Odd Lot and Other Marketplace Trading Obligations” (August 26, 2011).

“Market-on-Close Order” means an order for the purchase or sale of a security enteredon a marketplace on a trading day for the purpose of calculating and executing at theclosing price of the security on that marketplace on that trading day.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “marketplace” and “trading day”

Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment tosection 1.1 to amend the definition of “Market-on-Close Order” to add the phrase “calculatingand” prior to “executing”. See Market Integrity Notice 2007-002 – “Provisions Respecting
Competitive Marketplaces” (February 26, 2007).

“Market Operation Instrument” means National Instrument 21-101 – Marketplace
Operation as amended, supplemented and in effect from time to time.
“market order” means an order to:(a)

buy a security or a derivative to be executed upon entry to a marketplace at the best
ask price; or(b)sell a security or a derivative to be executed upon entry to a marketplace at the best
bid price.

Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation – “security”
UMIR section 1.1 – “best ask price”, “best bid price”, “derivative” and “marketplace”

Related Provision:

UMIR section 1.2(3)Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved
amendments to section 1.1 to amend the definition of “market order”. See IIROC Notice22-0140– “Amendments Respecting the Trading of Derivatives on a Marketplace”(September 15, 2022).

“Market Regulator” means:

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Rules & Policies(a)an Exchange, unless such Exchange monitors the conduct of its members indirectly
through a regulation services provider in which case, the regulation services
provider;(b)a QTRS, unless such QTRS monitors the conduct of its users indirectly through aregulation services provider in which case, the regulation services provider; and(c)in respect of any other marketplace, the regulation services provider with whom thatmarketplace has entered an agreement in accordance with the requirements of theTrading Rules.

Defined Terms:

NI 21-101 section 1.1 – “member”, “regulation services provider” and “user”
UMIR section 1.1 – “Exchange”, “marketplace”, “QTRS” and “Trading Rules”“marketplace” has the same meaning as set out in section 1.1 of Corporation By-law No.
1.
Regulatory History:

Effective October 21, 2021, the applicable securities commissions approved housekeeping
amendments to section 1.1 to amend the definition of a “marketplace”. See IIROC Notice
21-0193 – “Housekeeping amendments to the Universal Market Integrity Rules
Regarding the Definition of “Marketplace” (October 21, 2021).

“Marketplace Rules” means the rules, policies and other similar instruments adopted by
an Exchange or a QTRS as approved by the applicable securities regulatory authority but
not including any rules, policies or other similar instruments related solely to the listing of
securities or derivatives on an Exchange or to the quoting of securities on a QTRS.
Defined Terms:

NI 14-101 section 1.1(3) – “securities regulatory authority”
NI 21-101 section 1.4 – Interpretation – “security”
UMIR section 1.1 – “derivative”, “Exchange” and “QTRS”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved
amendments to section 1.1 to amend the definition of “Marketplace Rules”. See IIROC
Notice 22-0140– “Amendments Respecting the Trading of Derivatives on aMarketplace” (September 15, 2022).

“Marketplace Trading Obligations” means obligations imposed by:
(a)

(b)

Marketplace Rules on a member or user or a person employed by a member or user
to guarantee:(i)a two-sided market for a particular listed security or a listed derivative on acontinuous or reasonably continuous basis, or(ii)

the execution of orders for the purchase or sale of a particular security which
are less than a minimum number of units of the security as designated by themarketplace; orcontract between a marketplace and a member, user or subscriber to guarantee theexecution of orders for the purchase or sale of a particular security which are lessthan a minimum number of units of the security as stipulated by the terms of thePart 1 - Definitions and Interpretation
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contract provided such number is less than one standard trading unit and the orders
for the member, user or subscriber are automatically generated by the trading
system of the marketplace.
Defined Terms:

NI 21-101 section 1.1 – “member”, “order”, “subscriber” and “user”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “derivative”, “listed derivative”, “listed security”, “marketplace”,“Marketplace Rules” and “standard trading unit”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective August 26, 2011, the applicable securities commissions approved amendments tosection 1.1 to introduce the definition of “Marketplace Trading Obligations” to replace thedefinition of “Market Maker Obligations”. See IIROC Notice 11-0251 – “Provisions Respecting
Market Maker, Odd Lot and Other Marketplace Trading Obligations” (August 26, 2011).
Effective December 14, 2022, the applicable securities commissions approved amendments tosection 1.1 to amend the definition of “Marketplace Trading Obligations”. See IIROC Notice 220140– “Amendments Respecting the Trading of Derivatives on a Marketplace” (September
15, 2022).

“multiple client order” means an order that includes orders from more than one client,but does not include a principal order or a non-client order.
Defined Terms:

NI 21-101 section 1.1 - “order”
UMIR section 1.1 – “non-client order” and “principal order”

Related Provision:

UMIR section 6.2

Regulatory History:

Effective July 26, 2021, the applicable securities commissions approved amendments tosections 1.1, 6.2, 7.13 and 10.15 to add identifier and/or designation requirements forclients on orders sent to a marketplace. See IIROC Notice 19-0071 – “Amendments
Respecting Client Identifiers” (April 18, 2019).

“net cost” means the amount by which the sum of the total cost of the trade on thepurchase of securities based on the purchase price on the marketplace and any
commission charged to the client by the Participant exceeds the amount of any allowance,
discount, rebate and any other benefit with a monetary value that is allowed to the clienton the trade by the Participant or any other person.
Defined Terms:

NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “marketplace” and “Participant”
UMIR section 1.2(2) – “person” and “trade”“net proceeds” means the amount by which the sum of the total proceeds of the tradeon the sale of securities based on the sale price on the marketplace and the amount of
any allowance, discount, rebate and other benefit with a monetary value that is allowed tothe client on the trade by the Participant or any other person exceeds any commission
charged to the client by the Participant.
Defined Terms:

NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “marketplace” and “Participant”
UMIR section 1.2(2) – “person” and “trade”

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Rules & Policies“non-Canadian account” means an account of a client of the Participant or a client of anaffiliated entity of the Participant held by a Participant or an affiliated entity of a Participant
and the client is considered to be a non-resident for the purposes of the Income Tax Act(Canada).
Defined Terms:

NI 21-101 section 1.3(1) – “affiliated entity”
UMIR section 1.1 – “Participant”

Regulatory History:

Effective May 16, 2008, the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “non-Canadian account”. See Market Integrity Notice 2008008 – “Provisions Respecting “Off-Marketplace” Trades” (May 16, 2008).

“non-client order” means an order for the purchase or sale of a security or a derivative
received or originated by a Participant for an account:(a)for a partner, director, officer or a person holding a similar position or acting in asimilar capacity of the Participant or of a related entity of the Participant;(b)

for an employee of the Participant or of a related entity of the Participant who holds
approval from an Exchange or a self-regulatory entity; or(c)which is considered to be an employee account or a non-client account by a selfregulatory entity, but does not include a principal account.

Defined Terms:

NI 21-101 section 1.1 – “order” and “self-regulatory entity”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “derivative”, “employee”, “Exchange”, “Participant”, “principal account”
and “related entity”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved amendments
to section 1.1 to amend the definition of “non-client order”. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September
15, 2022).

“offered security” means all securities of the class of security that is, or will be upon
issuance, a listed security or a quoted security and:(a)is offered pursuant to a prospectus distribution or a restricted private placement;(b)

is offered by an offeror in a securities exchange take-over bid in respect of which atake-over bid circular or similar document is required to be filed under securities
legislation;(c)is offered by an issuer in an issuer bid in respect of which an issuer bid circular orsimilar document is required to be filed under securities legislation; or(d)would be issuable to a security holder pursuant to an amalgamation, arrangement,
capital reorganization or similar transaction in relation to which proxies are being
solicited from security holders that will receive the offered security in suchcircumstances that the issuance would be a distribution exempt from prospectus
requirements in accordance with applicable securities legislation, provided that, if

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the security described in clauses (a) to (d) is a unit comprised of more than one typeor class, each security comprising the unit shall be considered to be an “offeredsecurity”.
Defined Terms:

NI 14-101 section 1.1(3) – “issuer bid” and “securities legislation”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “listed security”, “quoted security”, “restricted private placement” and“securities exchange take-over bid”

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments tosection 1.1 that came into force on May 9, 2005 to repeal and replace the definition of “offeredsecurity”. See Market Integrity Notice 2005-007 – “Amendments Respecting Trading During
Certain Securities Transactions” (March 4, 2005).

“Opening Order” means an order for the purchase or sale of a security entered on amarketplace prior to the opening of trading on that marketplace on a trading day for the
purpose of calculating and executing at the opening price of the security on thatmarketplace on that trading day provided an order shall cease to be an Opening Order if
the order does not trade at the opening of trading of that security on that marketplace onthat trading day.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “marketplace” and “trading day”

Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment tosection 1.1 to replace the definition of “Opening Order”. See Market Integrity Notice 2007-002– “Provisions Respecting Competitive Marketplaces” (February 26, 2007).

“order execution service” means a service that meets the requirements, from time totime, under Part D of Corporation Rule 3200 – Order Execution Only Accounts.
Regulatory History:

On July 4, 2013, the applicable securities commissions approved an amendment tosection1.1 to add the definition “order execution service”, effective March 1, 2014. See
IIROC Notice 13-0184 – “Provisions Respecting Third-Party Electronic Access toMarketplaces” (July 4, 2013).
Effective December 31, 2021, the applicable securities commissions approved
housekeeping amendments to section 1.1 to replace rule references to the Dealer Member
Rules with provisions of the IIROC Rules. See IIROC Notice 20-0042 - Rules Notice – Noticeof Approval – UMIR – “Housekeeping amendments to UMIR Following Implementationof IIROC Rules” (March 5, 2020).

“Participant” means:(a)a dealer registered in accordance with securities legislation of any jurisdiction and
who is:(i)a member of an Exchange,(ii)

a user of a QTRS, or(iii)

a subscriber of an ATS; orPart 1 - Definitions and Interpretation
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Rules & Policies(b)a person who has been granted trading access to a marketplace and who performs
the functions of a derivatives market maker.

Defined Terms:

NI 14-101 section 1.1(3) – “jurisdiction” and “securities legislation”
NI 21-101 section 1.1 –“ATS”, “member”, “subscriber” and “user”
UMIR section 1.1 – “derivatives market maker”, “Exchange”, “marketplace” and “QTRS”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective December 9, 2013, the applicable securities commissions approved amendments
to the French version of UMIR. See IIROC Notice 13-0294 - “Amendments to the French
version of UMIR” (December 9, 2013).

“Policy” means a policy statement adopted by a Market Regulator in connection with theadministration or application of UMIR as such policy statement is amended, supplemented
and in effect from time to time.
Defined Terms:

UMIR section 1.1 – “Market Regulator” and “UMIR”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicablesecurities commissions approved an amendment to section 1.1 that came into force on June
1, 2008 to make editorial changes. See Footnote 1 in Status of Amendments.

“pre-arranged trade” means a trade in respect of which the terms of the trade wereagreed upon, prior to the entry of either the order to purchase or to sell on a marketplace,by the persons entering the orders or by the persons on whose behalf the orders areentered.
Defined Terms:

NI 21-101 section 1.1 – “order”
UMIR section 1.1 – “marketplace”
UMIR section 1.2 – “person” and “trade”

Regulatory History:

Effective May 16, 2008, the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “pre-arranged trade”. See IIROC Notice 2008-008 –“Provisions Respecting “Off-Marketplace” Trades” (May 16, 2008).

“Pre-Borrow Security” means a security that has been designated by a Market Regulator
to be a security in respect of which an order, that on execution would be a short sale, may
not be entered on a marketplace unless the Participant or Access Person has madearrangements to borrow the securities that would be necessary to settle the trade prior to
the entry of the order.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “Market Regulator”, “marketplace”, “Participant” and“short sale”
UMIR section 1.2 – “trade”

Regulatory History:

Part 1 - Definitions and Interpretation
May 27, 2024

On March 2, 2012, the applicable securities commissions approved an amendment tosection 1.1, effective October 15, 2012, to add the definition of “Pre-Borrow Security”. See
IIROC Notice 12-0078 – “Provisions Respecting Regulation of Short Sales and Failed
Trades” (March 2, 2012).

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Rules & Policies“principal account” means an account in which a Participant or a related entity of theParticipant holds a direct or indirect interest other than an interest in the commission
charged on a transaction.
Defined Terms:

UMIR section 1.1 – “Participant” and “related entity”“principal order” means an order for the purchase or sale of a security or a derivative
received or originated by a Participant for a principal account.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “derivative”, “Participant” and “principal account”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved
amendments to section 1.1 to amend the definition of “principal order”. See IIROC Notice22-0140– “Amendments Respecting the Trading of Derivatives on a Marketplace”(September 15, 2022).

“Program Trade” means a trade resulting from a series of market orders for the purchaseor sale of particular securities underlying an index that has been designated by a Market
Regulator where such trade is undertaken in conjunction with a trade in a derivative theunderlying interest of which is the index.
Defined Terms:

NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “market order” and “Market Regulator”
UMIR section 1.2(2) – “trade”

General Commentary:

A current list of the indices which have been designated as an “index” is available on thewebsite of the Investment Industry Regulatory Organization of Canada.

“protected marketplace” means a marketplace that displays “protected orders” asdefined under the Trading Rules.
Defined Terms:

NI 21-101 section 1.1 –“information processor” and “order”
UMIR section 1.1 – “marketplace” and “Market Operation Instrument”
UMIR section 1.2 – “trade”

Regulatory History:

Effective May 16, 2008, the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “protected marketplace”. See Market Integrity Notice 2008008 – “Provisions Respecting “Off-Marketplace” Trades” (May 16, 2008).
Effective September 18, 2015, the applicable securities commissions approved an amendment
to the definition of “protected marketplace”. See IIROC Notice 15-0211 - Notice of Approval –“Provisions Respecting Unprotected Transparent Marketplaces and the Order
Protection Rule” (September 18, 2015).

“Protected Party” means in respect of a Market Regulator:(a)the Market Regulator;(b)a director, officer or employee of the Market Regulator;(c)a member of the Hearing Committee or of a committee appointed by the Board; orPart 1 - Definitions and Interpretation
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Rules & Policies(d)an independent contractor retained by the Market Regulator to provide services tothe Market Regulator.

Defined Terms:

UMIR section 1.1 – “Board”, “employee”, “Hearing Committee” and “Market Regulator”“QTRS” means a recognized quotation and trade reporting system.
Defined Terms:

NI 21-101 section 1.1 – “recognized quotation and trade reporting system”“quoted security” means a security quoted on a QTRS.
Defined Terms:

NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “QTRS”“Regular Session” means the time period during a trading day when a marketplace isordinarily open for trading, but does not include any extended or special trading facility ofthe marketplace.
Defined Terms:

UMIR section 1.1 – “marketplace” and “trading day”

“Regulated Person” - repealed
Defined Terms:

NI 21-101 section 1.1 – “regulation services provider”
UMIR section 1.1 – “Access Person”, “Market Regulator”, “marketplace”, “Marketplace Rules”,“Participant” and “UMIR”
UMIR section 1.2(2) – “person”

Related Provisions:

UMIR sections 10.3 and 10.4

Regulatory History:

Effective February 6, 2004, the applicable securities regulators approved the addition of clause(e) of the definition of “Regulated Person”. See Market Integrity Notice 2004-006 – “Definition
of Regulated Person” (February 6, 2004).
In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to section 1.1 that came into force on June 1, 2008 to
make editorial changes. See Footnote 1 in Status of Amendments.
Effective September 1, 2016, the applicable securities commissions approved an amendment
to section 1.1 to repeal the definition of “Regulated Person” and replace with the definition of“Subject Person”. See IIROC Notice 16-0122 – “Implementation of the consolidated IIROC
Enforcement, Examination and Approval Rules” (June 9, 2016).

“related derivative” means, in respect of a particular security or derivative,a derivative that is related to the security or derivative because the derivative’s market
price, value, delivery obligations, payment obligations or settlement obligations are, in amaterial way, derived from, referenced to or based on the market price, value, delivery
obligations, payment obligations or settlement obligations of the security or derivative.

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Defined Terms:

NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “derivative”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved
amendments to section 1.1 to add the definition of “related derivative”. See IIROC Notice22-0140 – “Amendments Respecting the Trading of Derivatives on a Marketplace”(September 15, 2022).

“related entity” means, in respect of a particular person:(a)an affiliated entity of the particular person which carries on business in Canada andis registered as a dealer or adviser in accordance with applicable securities
legislation; and(b)a person who has been designated by a Market Regulator in accordance withsubsection (3) of Rule 10.4 as a person who acts in conjunction with the particularperson.

Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
NI 21-101 section 1.3(1) – “affiliated entity”
UMIR section 1.1 – “Market Regulator”
UMIR section 1.2(2) – “person”

Related Provision:

UMIR section 10.4(3)Regulatory History:

Effective December 9, 2013, the applicable securities commissions approved amendments
to the French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the
French version of UMIR” (December 9, 2013).

“related security” means, in respect of a particular security or derivative:(a)a security which is convertible or exchangeable into the particular security orderivative, or(b)

a security into which the particular security or derivative is convertible or
exchangeable.

Defined Terms:

NI 21-101 section 1.4 – Interpretation -- “security”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved amendments
to section 1.1 to amend the definition of “related security”. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September
15, 2022).

UMIR 1.1 – “derivative”“Requirements” means, collectively:
(a)

UMIR;

(b)

the Policies;(c)the Trading Rules;(d)the Marketplace Rules;

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Rules & Policies(e)any direction, order or decision of the Market Regulator or a Market Integrity Official;
and

(f)

securities legislation,as amended, supplemented and in effect from time to time.
Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
UMIR section 1.1 – “Market Integrity Official”, “Market Regulator”, “Marketplace Rules”,“Policy”, “Trading Rules” and “UMIR”

Regulatory History:

Effective April 1, 2005, the applicable securities commissions approved amendments tosection 1.1 to amend the definition of “Requirements” by adding clause (f).See Market
Integrity Notice 2005-011 – “Provisions Respecting Manipulative and Deceptive
Activities” (April 1, 2005).
In connection with the recognition of IIROC and its adoption of UMIR, the applicablesecurities commissions approved an amendment to section 1.1 that came into force on June
1, 2008 to make editorial changes. See Footnote 1 in Status of Amendments.

“restricted period” means, for a dealer-restricted person or an issuer-restricted person,
the period:(a)in connection with a prospectus distribution or a restricted private placement of any
offered security, commencing two trading days prior to:(i)the day the offering price of the offered security is determined, if the securities
are to be issued at a fixed price as part of a non-continuous distribution, or(ii)

the issuance of the offered security, if the securities are issued as part of:(A)

a continuous distribution,(B)

a distribution at a non-fixed price permitted by National Instrument 44101 – Short Form Prospectus Distributions, or(C)an at-the-market distribution for the purposes of National Instrument 44102 – Shelf Distributions,and ending on the date the selling process has ended and all stabilization
arrangements relating to the offered security are terminated provided that, if theperson is a dealer-restricted person, the period shall commence on the date theParticipant enters into an agreement or reaches an understanding to participate in
the prospectus distribution or restricted private placement of securities, whether or
not the terms and conditions of such participation have been agreed upon if that dateis later that determined for the purposes of clause (i) or (ii);(b)

in connection with a securities exchange take-over bid or issuer bid, commencing
on the date of dissemination of the securities exchange take-over bid circular or
issuer bid circular or similar document and ending with the termination of the period
during which securities may be deposited under such bid, including any extension
thereof, or the withdrawal of the bid; and(c)in connection with an amalgamation, arrangement, capital reorganization or similartransaction, commencing on the date of dissemination of the information circular forsuch transaction and ending on the date for approval of the transaction by thePart 1 - Definitions and Interpretation
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security holders that will receive the offered security or the termination of thetransaction by the issuer or issuers.
Defined Terms:

NI 14-101 section 1.1(3) – “issuer bid”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “dealer-restricted person”, “issuer-restricted person”, “offered security”,“Participant”, “restricted private placement”, “securities exchange takeover-bid” and “tradingday”
UMIR section 1.2(2) – “person”

Related Provisions:

UMIR section 1.2(6) – interpretation of “restricted period”
UMIR Policy 1.2 Part 2 – interpretation of “selling process has ended”

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments tosection 1.1 that came into force on May 9, 2005 to add the definition of “restricted period”. See
Market Integrity Notice 2005-007 – “Amendments Respecting Trading During Certain
Securities Transactions” (March 4, 2005).
Effective January 8, 2010, the applicable securities commissions approved amendments tosection 1.1 to amend the definition of “restricted period”. See IIROC Notice 10-0006 –“Provision Respecting trading During Certain Securities Transactions” (January 8, 2010).

“restricted person" - repealed
Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments tosection 1.1 that came into force on May 9, 2005 to repeal the definition of “restricted person”.
See Market Integrity Notice 2005-007 – “Amendments Respecting Trading During Certain
Securities Transactions” (March 4, 2005).

“restricted private placement” means a distribution of securities made pursuant to:(a)section 2.3, 2.9 or 2.10 of National Instrument 45-106 – Prospectus and Registration
Exemptions; or(b)section 2.1 of Ontario Securities Commission Rule 45-501 – Ontario Prospectus andRegistration Exemptions or similar provisions of applicable securities legislation, andthe number of securities to be distributed constitutes more than 10% of the issued
and outstanding securities of the class subject to the distribution.

Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
NI 21-101 section 1.4 – Interpretation -- “security”

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments tosection 1.1 that came into force on May 9, 2005 to add the definition of “restricted private
placement”. See Market Integrity Notice 2005-007 – “Amendments Respecting Trading
During Certain Securities Transactions” (March 4, 2005).
Effective January 8, 2010, the applicable securities commissions approved amendments tosection 1.1 to repeal and replace the definition of “restricted private placement”. See IIROC
Notice 10-0006 – “Provision Respecting trading During Certain Securities Transactions”(January 8, 2010).

“restricted security” means:(a)the offered security; orPart 1 - Definitions and Interpretation
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Rules & Policies(b)

any connected security.

Defined Terms:

UMIR section 1.1 – “connected security” and “offered security”

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments tosection 1.1 that came into force on May 9, 2005 to add the definition of “restricted security”. See
Market Integrity Notice 2005-007 – “Amendments Respecting Trading During Certain
Securities Transactions” (March 4, 2005).

“routing arrangement” means an arrangement under which a Participant that is amember, user or subscriber permits an investment dealer or a foreign dealer equivalent
to electronically transmit an order relating to a security or a derivative containing theidentifier of the Participant:(a)through the systems of the Participant for automatic onward transmission to amarketplace; or(b)directly to a marketplace without being electronically transmitted through thesystems of the Participant.

Defined Terms:

NI 21-101 section 1.1 - “member”, “subscriber” and “user”
NI 21-101 section 1.4 – Interpretation – “security”
NI 31-103 section 1.1 – “investment dealer”
UMIR section 1.1 – “derivative”, “foreign dealer equivalent”, “marketplace” and “Participant”

Regulatory History:

On July 4, 2013, the applicable securities commissions approved an amendment to section
1.1 to add the definition “routing arrangement”, effective March 1, 2014. See IIROC Notice13-0184 – “Provisions Respecting Third-Party Electronic Access to Marketplaces” (July4, 2013).
Effective December 14, 2022, the applicable securities commissions approved amendments
to section 1.1 to amend the definition of “routing arrangement”. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September 15,2022).

“Rules” - repealed.
Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to section 1.1 that came into force on June 1, 2008 to
repeal the definition of “Rules”. See Footnote 1 in Status of Amendments.

“securities exchange take-over bid” means a take-over bid where the consideration forthe securities of the offeree is to be, in whole or in part, securities traded on a marketplace.
Defined Terms:

NI 14-101 section 1.1(3)- “take-over bid”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “marketplace”“short-marking exempt order” means an order for the purchase or sale of a security froman account that is:(a)an arbitrage account;Part 1 - Definitions and Interpretation
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Rules & Policies(b)the account of a person with Marketplace Trading Obligations in respect of a security
for which that person has obligations;(c)a client account, non-client account or principal account:

(d)

(i)

for which order generation and entry is fully-automated, and(ii)which, in the ordinary course, does not have, at the end of each trading day,more than a nominal position, whether short or long, in a particular security;a principal account that has acquired during a trading day a position in a particular
security in a transaction with a client that is unwound during the balance of the
trading day such that, in the ordinary course, the account does not have, at the endof each trading day, more than a nominal position, whether short or long, in aparticular security; or(e) a principal account for a Participant that has:
(i)
(ii)

Marketplace Trading Obligations in respect of an exempt Exchange-traded
Fund, orentered into an agreement for the continuous distribution of an Exempt
Exchange-traded Fund;

if the order is for the Exempt Exchange-traded Fund security or one of its underlying
securities to hedge a pre-existing position in the Exempt Exchange-traded Fund
security or one of its underlying securities and in the normal course, the accountdoes not have, at the end of each trading day, more than a minimal exposed risk.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “arbitrage account”, “Marketplace Trading Obligations”, “principal
account” and “trading day”
UMIR section 1.2 – “person”

Regulatory History:

On March 2, 2012, the applicable securities commissions approved an amendment tosection 1.1, effective October 15, 2012, to add the definition of “short-marking exempt
order”. See IIROC Notice 12-0078 – “Provision Respecting Regulation of Short Sales
and Failed Trades” (March 2, 2012).
On February 11, 2016, the applicable securities commissions approved an amendment tosection 1.1, effective April 11, 2016, to amend the definition of “short-marking exempt order”.
See IIROC Notice 16-0028 – “Amendment to the Short-marking Exempt Order
Definition” (February 11, 2016).
Effective July 27, 2023, the applicable securities commissions approved housekeeping
amendments to UMIR to correct inaccurate referencing and typographical mistakes and toensure consistency between the English and French versions of UMIR. See CIRO Bulletin
23-0107 - "Housekeeping Amendments to UMIR" (July 27, 2023).

Guidance:

See IIROC Notice 16-0029 – “Updated Guidance on “Short Sale” and “Short-Marking
Exempt” Order Designations” (February 11, 2016).

“short sale” means a sale of a security, other than a derivative instrument, which theseller does not own either directly or through an agent or trustee and, for this purpose, aseller shall be considered to own a security if the seller, directly or through an agent ortrustee:Part 1 - Definitions and Interpretation
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Rules & Policies(a)has purchased or has entered into an unconditional contract to purchase thesecurity, but has not yet received delivery of the security;(b)owns another security that is convertible or exchangeable into that security and has
tendered such other security for conversion or exchange or has issued irrevocable
instructions to convert or exchange such other security;(c)

has an option to purchase the security and has exercised the option;(d)has a right or warrant to subscribe for the security and has exercised the right or
warrant; or(e)

has entered into a contract to purchase a security that trades on a when issued basis
and such contract is binding on both parties and subject only to the condition ofissuance or distribution of the security,

but a seller shall be considered not to own a security if:(f)the seller has borrowed the security to be delivered on the settlement of the trade
and the seller is not otherwise considered to own the security in accordance with thisdefinition;(g)

the security held by the seller is subject to any restriction on sale imposed byapplicable securities legislation or by an Exchange or QTRS as a condition of thelisting or quoting of the security; or(h)the settlement date or issuance date pursuant to:(i)an unconditional contract to purchase,(ii)

a tender of a security for conversion or exchange,(iii)

an exercise of an option, or(iv)

an exercise of a right or warrant

would, in the ordinary course, be after the date for settlement of the sale.
Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Exchange”, “QTRS” and “trades on a when issued basis”

Related Provision:

UMIR Policy 1.1, Part 3 – Definition of ‘’Short Sale’’

Guidance:

See IIROC Notice 22-0130 – “Guidance on Participant Obligations to have Reasonable
Expectation to Settle any Trade Resulting from the Entry of a Short Sale Order”(August 17, 2022)

Regulatory History:

Effective August 27, 2004, the applicable securities commissions approved the amendment
to add clause (h) to the definition of “short sale”. See Market Integrity Notice 2004-023 –“Provisions Respecting Short Sales” (August 27, 2004).
On October 15, 2008, the applicable securities commissions approved amendments tosection 1.1 that came into force on October 14, 2008 to amend the definition of “short sale”.
See IIROC Notice 08-0143 – “Provisions Respecting Short Sales and Failed Trades”(October 15, 2008).
Effective December 9, 2013, the applicable securities commissions approved amendments
to the French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French
version of UMIR” (December 9, 2013).

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Rules & Policies“Short Sale Ineligible Security” means a security or a class of securities that has been
designated by a Market Regulator to be a security in respect of which an order that on
execution would be a short sale may not be entered on a marketplace for a particular
trading day or trading days.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Market Regulator”, “marketplace”, “short sale” and “trading day”

Related Provision:

UMIR Policy 1.1, Part 4 – Definition of ‘’Short Sale Ineligible Security’’

Regulatory History:

On October 15, 2008, the applicable securities commissions approved amendments tosection 1.1 that came into force on October 14, 2008 to add the definition of “short saleineligible security”. See IIROC Notice 08-0143 – “Provisions Respecting Short Sales andFailed Trades” (October 15, 2008).
Effective December 9, 2013, the applicable securities commissions approved amendments
to the French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French
version of UMIR” (December 9, 2013).

“significant shareholder” means any person holding separately, or in combination withother persons, more than 20 per cent of the outstanding voting securities of an issuer.
Defined Terms:

NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.2(2) – “person”“Special Terms Order” means an order for the purchase or sale of a security:(a)for less than a standard trading unit;(b)

the execution of which is subject to a condition other than as:

(c)

(i)

to price,(ii)

to the date of settlement; or(iii)

imposed by the marketplace on which the order is entered as a condition for
the entry or execution of the order; orthat on execution would be settled on a date other than:(i)the first business day following the date of the trade, or(ii)

any settlement date specified in a special rule or direction referred to in
subsection (2) of Rule 6.1 that is issued by an Exchange or a QTRS,

but does not include an order that is a Basis Order, Call Market Order, Closing Price Order,
Market-on-Close Order, Opening Order or Volume-Weighted Average Price Order.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 - “Basis Order”, “Call Market Order”, “Closing Price Order”, “Exchange”,“Market-on-Close Order”, “marketplace”, “Opening Order”, “QTRS”, “standard trading unit” and“Volume-Weighted Average Price Order”
UMIR section 1.2(2) – “trade”

Related Provision:

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Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment tosection 1.1 to replace the definition of “Special Terms Order”. See Market Integrity Notice 2007002 – “Provisions Respecting Competitive Marketplaces” (February 26, 2007).
Effective September 5, 2017, the applicable securities commissions approved an amendment
to the definition of “Special Terms Order”. See IIROC Notice 17-0133 – “Amendments tofacilitate the industry’s move to T+2 settlement” (June 29, 2017).
Effective March 27, 2024, the applicable securities commissions approved amendments to thedefinition of a "Special Terms Order". See Bulletin 23-0150 – “Amendments to UMIR and
IDPC Rules to facilitate the investment industry’s move to T+1 settlement” (October 26,2023).

“standard trading unit” means, in respect of:(a)a listed derivative, 1 contract;(b)a debt security that is a listed security or a quoted security, $1,000 in principal
amount; or(c)any equity or similar security:(i)

1,000 units of a security trading at less than $0.10 per unit,(ii)

500 units of a security trading at $0.10 or more per unit and less than $1.00
per unit, and(iii)

100 units of a security trading at $1.00 or more per unit.

Defined Terms:

NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “derivative”, “equity security”, “listed derivative”, “listed security” and“quoted security”

Related Provision:

UMIR section 1.2(5)Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved
amendments to section 1.1 to amend the definition of “standard trading unit”. See IIROC
Notice 22-0140– “Amendments Respecting the Trading of Derivatives on aMarketplace” (September 15, 2022).

“Subject Person” means, in respect of the jurisdiction of a Market Regulator inconnection with the conduct of a person:
(a)
(b)
(c)
(d)
(e)

any marketplace for which the Market Regulator is the regulation services provider
or was the regulation services provider at the time of the conduct;
any Participant or Access Person of a marketplace for which the Market Regulator
is the regulation services provider or was the regulation services provider at the timeof the conduct;
any person to whom responsibility for compliance with UMIR by other persons areextended in accordance with Consolidated Rule 1400 or to whom responsibility had
been extended at the time of the conduct;
any person to whom the application of UMIR are extended in accordance with Rule10.4 or to whom UMIR had been extended at the time of the conduct; andany person subject to a Marketplace Rule of a marketplace for which the Market
Regulator is the regulation services provider or was the regulation services provider
at the time of the conduct.

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Defined Terms:

NI 21-01 section 1.1 – “regulation services provider”
UMIR section 1.1 – “Access Person”, “Market Regulator”, “marketplace”, “Marketplace
Rules”, “Participant”, and “UMIR”
UMIR section 1.2(2) – “person”

Related Provisions:

UMIR sections 10.3 and 10.4
Consolidated Rule 1400

Regulatory History:

Effective September 1, 2016, the applicable securities commissions approved anamendment to section 1.1 to repeal the definition “Regulated Person” and replace with thedefinition of “Subject Person”. See IIROC Notice 16-0122 – “Implementation of theconsolidated IIROC Enforcement, Examination and Approval Rules” (June 9, 2016).

“trades on a when issued basis” means purchases or sales of a security to be issued
pursuant to:(a)a prospectus offering where a receipt for the final prospectus for the offering has
been issued by the applicable securities regulatory authority but the offering has not
closed and settled;(b)a proposed plan of arrangement, an amalgamation or a take-over bid prior to theeffective date of the amalgamation or the arrangement or the expiry date of the takeover bid; or(c)any other transaction that is subject to the satisfaction of certain conditions,and the trade is to be settled only if the security is issued and the trade in the security prior
to the issuance would not contravene the applicable securities legislation.
Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”, “securities regulatory authority” and “takeover bid”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.2 – “trade”

Regulatory History:

Effective December 9, 2013, the applicable securities commissions approved amendments
to the French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the
French version of UMIR” (December 9, 2013).

“trading day” means a calendar day during which trades are executed on a marketplace.
Defined Terms:

UMIR section 1.1 – “marketplace”
UMIR section 1.2 – “trade”“trading increment” means the minimum difference in price at which orders may beentered in accordance with Rule 6.1.
Defined Terms:

NI 21-101 section 1.1 – “order”

Related Provision:

UMIR section 6.1

Regulatory History:

Effective May 16, 2008, the applicable securities commissions approved an amendment tosection 1.1 to add the definition of “trading increment”. See Market Integrity Notice 2008-008 –“Provisions Respecting “Off-Marketplace” Trades” (May 16, 2008).

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Rules & Policies“Trading Rules” means National Instrument 23-101 as amended, supplemented and in
effect from time to time.
“UMIR” means those Rules adopted by the Corporation and designated by the
Corporation as the Universal Market Integrity Rules as amended, supplemented and in
effect from time to time.
Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to section 1.1 that came into force on June 1, 2008 to
make editorial changes. See Footnote 1 in Status of Amendments.

“Volume-Weighted Average Price Order” means an order for the purchase or sale of asecurity entered on a marketplace on a trading day for the purpose of executing trades at
an average price of the security traded on that trading day on that marketplace or on any
combination of marketplaces known at the time of the entry of the order.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “marketplace” and “trading day”
UMIR section 1.2 – “trade”

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Rules & Policies

POLICY 1.1 - DEFINITIONSPart 1 – Definition of “connected security”
The definition of a “connected security” includes, among other things, a security of theissuer of the offered security or another issuer that, according to the terms of the offeredsecurity, may “significantly determine” the value of the offered security. The Market
Regulator takes the view that, absent other mitigating factors, a connected security“significantly determines” the value of the offered security, if, in whole or in part, it accounts
for more than 25% of the value of the offered security.

Part 2 – Definition of “Exempt Exchange-traded Fund”
An “Exempt Exchange-traded Fund” is defined, in part, as a mutual fund for the purposesof applicable securities legislation, the units of which are a listed security or a quoted
security and are in continuous distribution in accordance with applicable securities
legislation. The definition excludes a mutual fund that has been designated by the Market
Regulator to be excluded from the definition.
As guidance, a mutual fund may be designated by the Market Regulator if it is determinedthat the trading price of units of the fund may be susceptible to manipulation due to aparticular feature of the mutual fund. Factors which the Market Regulator would take into
account in making a designation to exclude a particular mutual fund would be:•

the lack of liquidity or public float of the security (or the underlying securities which
comprise the portfolio of the mutual fund);•the absence of the ability to redeem units at any time for a “basket” of theunderlying securities in addition to cash;•

the absence of the ability to exchange a “basket” of the underlying securities at
any time for units of the fund;•the fact that the fund does not frequently make a net asset value calculation
publicly available; and•the fact that there are no derivatives based on units of the fund, the underlying
index or the underlying securities are listed on a marketplace.

None of these additional five factors is determinative in and of itself and each security will
be evaluated on its own merits.

Part 2.1 – Definition of “Pre-Borrow Security”
Under the definition of a “Pre-Borrow Security”, the Market Regulator may designate asecurity in respect of which an order that on execution would be a short sale may not beentered on a marketplace unless the Participant or Access Person entering the order has
made arrangements to borrow the securities that would be required to settle the trade priorPart 1 - Definitions and Interpretation
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to the entry of the order. In determining whether to make such a designation, the Market
Regulator shall consider whether:•based on information known to the Market Regulator, there is an increase in thenumber, value or volume of failed trades in the particular security by more than
one Participant or Access Person;•

the number or pattern of failed trades is related to short selling; and•the designation would be in the interest of maintaining a fair and orderly market.

Part 3 – Definition of “Short Sale”
Under the definition of “short sale”, a seller shall be considered to own a security undervarious circumstances including if the seller, directly or through an agent or trustee:•owns another security that is convertible or exchangeable into that security andhas tendered such other security for conversion or exchange or has issued
irrevocable instructions to convert or exchange such other security;•

has an option to purchase the security and has exercised the option; or•

has a right or warrant to subscribe for the security and has exercised the right or•

warrant.

In each of these circumstances, the seller must have taken all steps necessary to become
legally entitled to the security, including having:•made any payment required;•submitted to the appropriate person any required forms or notices; and•submitted, if applicable, to the appropriate person any certificates for securities
to be converted, exchanged or exercised.

Guidance:

See IIROC Notice 22-0130 – “Guidance on Participant Obligations to have Reasonable
Expectation to Settle any Trade Resulting from the Entry of a Short Sale Order” (August17, 2022).

Part 4 – Definition of “Short Sale Ineligible Security”
Under the definition of a “short sale ineligible security”, the Market Regulator may
designate a security or class of securities in respect of which an order that on execution
would be a short sale may not be entered on a marketplace for a particular trading day or
trading days. In determining whether to make such a designation, the Market Regulator
shall consider whether:•based on reports of failed trades submitted to the Market Regulator in accordancewith Rule 7.10 or other information known to the Market Regulator, there is in a

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Rules & Policies

particular security or class of securities an unusual number or pattern of failed
trades by more than one Participant or Access Person;•

the number or pattern of failed trades is related to short selling; and•the designation would be in the interest of maintaining a fair and orderly market.

Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation” and “securities regulatory authority”
NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “connected security”, “Exempt Exchange-traded Fund”,“failed trade”, “listed security”, “Market Regulator”, “marketplace”, “offered security”,“Participant”, “Pre-Borrow Security”, “quoted security”, “short sale”, “Short Sale Ineligible
Security” and “trading day”
UMIR section 1.2 – “trade”

Related Provision:

UMIR section 7.10

Guidance:

See IIROC Notice 22-0130 – “Guidance on Participant Obligations to have Reasonable
Expectation to Settle any Trade Resulting from the Entry of a Short Sale Order” (August17, 2022).

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments to
the Policies under Rule 1.1 that came into force on May 9, 2005 to add Parts 1 and 2. See
Market Integrity Notice 2005-007 – “Amendments Respecting Trading During Certain
Securities Transactions” (March 4, 2005).
In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to section 1.1 that came into force on June 1, 2008 to
make editorial changes. See Footnote 1 in Status of Amendments..
On October 15, 2008, the applicable securities commissions approved amendments to the
Policies under Rule 1.1 that came into force on October 14, 2008 to add Parts 3 and 4. See
IIROC Notice 08-0143 – “Provisions Respecting Short Selling and Failed Trades” (October
15, 2008).
Effective January 8, 2010, the applicable securities commissions approved amendments tosection 1.1 to repeal and replace Part 2 of Policy 1.1. See IIROC Notice 10-0006 – “Provisions
Respecting Trading During Certain Securities Transactions” (January 8, 2010).
On March 2, 2012, the applicable securities commissions approved an amendment to Policy
1.1, effective October 15, 2012, to add Part 2.1.
Effective December 9, 2013, the applicable securities commissions approved amendments to
the French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French
version of UMIR” (December 9, 2013).

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1.2

Interpretation
(1)

(2)

Unless otherwise defined or interpreted, every term used in UMIR that is:(a)defined in subsection 1.1(3) of National Instrument 14-101 – Definitions has themeaning ascribed to it in that subsection;(b)defined or interpreted in the Marketplace Operation Instrument has the meaning
ascribed to it in that National Instrument;(c)defined or interpreted in the Electronic Trading Rules has the meaning ascribed to
it in that National Instrument; and(d)a reference to a requirement of an Exchange or a QTRS shall have the meaning
ascribed to it in the applicable Marketplace Rule.

For the purposes of UMIR, the following terms shall be as defined by applicablesecurities legislation except that:“person” includes any corporation, incorporated association, incorporated syndicate orother incorporated organization.
“trade” includes a purchase or acquisition of a security or a derivative for valuable
consideration in addition to any sale or disposition of a security or a derivative forvaluable consideration.
“security” does not include a derivative.

(3)

In determining the value of an order for the purposes of Rule 6.3, Rule 6.4 and Rule8.1, the value shall be calculated as of the time of the receipt or origination of the orderand shall be calculated by multiplying the number of units of the security to be bought
or sold under the order by:
(a)

(b)

(c)

in the case of a limit order for the purchase of a security, the lesser of:(i)the specified maximum price in the order, and(ii)

the best ask price;in the case of a limit order for the sale of a security, the greater of:(i)the specified minimum price in the order, and(ii)

the best bid price;in the case of a market order for the purchase of a security, the best ask price;and(d) in the case of a market order for the sale of a security, the best bid price.
(4)

For the purposes of determining the “last sale price”, if a sale of at least a standard
trading unit of a particular security has not been previously displayed in a consolidated
market display the last sale price shall be deemed to be the price:(a)of the last sale of the security on an Exchange, if the security is a listed security;

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UMIR 1.2-1(b)of the last sale of the security on a QTRS, if the security is a quoted security;(c)

at which the security has been issued or distributed to the public, if the security
has not previously traded on a marketplace; and that has been accepted by aMarket Regulator, in any other circumstance.

(d)that has been accepted by a Market Regulator, in any other circumstance.

(5)

For the purposes of determining the price at which a security is trading for the purposes ofthe definition of a “standard trading unit”, the price shall be the last sale price of theparticular security on the immediately preceding trading day on the Exchange on which thesecurity is listed or the QTRS on which the security is quoted.

(6)

For the purposes of the definition of “restricted period”:(a) the selling process shall be considered to end:

(b)

(i)

in the case of a prospectus distribution, if a receipt has been issued for the
final prospectus by the applicable securities regulatory authority and theParticipant has allocated all of its portion of the securities to be distributed
under the prospectus and all selling efforts have ceased, and(ii)

in the case of a restricted private placement, the Participant has allocated allof its portion of the securities to be distributed under the offering;stabilization arrangements shall be considered to have terminated on the date that isthe earlier of when:(i)in the case of a syndicate of underwriters or agents, the lead underwriter or
agent determines, in accordance with the syndication agreement, that thesyndication agreement has been terminated such that any purchase or saleof a restricted security by a Participant after the time of termination is not
subject to the stabilization arrangements or otherwise made jointly for theParticipants that were party to the stabilization arrangements, or(ii)

the offered securities, exclusive of any securities that may be issued
pursuant to the exercise of an option granted to a dealer-restricted person tocover over-allotment of securities in the distribution, are issued and all
statutory rights of withdrawal in connection with such issuance have expired;and(c) if the offering price is determined by a formula involving trading activity in the offeredsecurity or a connected security on one or more marketplaces for a period of time, theoffering price shall be considered to be determined on the first trading day included in
the calculation for the purposes of the formula.
(7)

Where used to indicate a relationship with an entity, associated entity has the meaning
ascribed to the term "associate" in applicable securities legislation and also includes any

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UMIR 1.2-2

person of which the entity beneficially owns voting securities carrying more than 10 per
cent of the voting rights attached to all outstanding voting securities of the person.
(8)

For the purposes of determining the “best ask price” or the “best bid price” at any
particular time reference is made to orders:(a) contained in a consolidated market display for a protected marketplace that isthen open for trading and in respect of which trading in the particular securityor(b) displayed on an Exchange that is then open for trading and in respect of which
trading in the particular derivativeon that marketplace has not been:(i) halted, suspended or delayed for regulatory purposes in accordancewith Rule 9.1; or(ii) halted, suspended or delayed in accordance with a Marketplace Ruleor a requirement of the marketplace.

POLICY 1.2 - INTERPRETATIONPart 1 – Meaning of “acting jointly or in concert”
The definitions of a “dealer-restricted person” and “issuer-restricted person” include a person
acting jointly or in concert with a person that is also a dealer-restricted person or an issuerrestricted person, as applicable, for a particular transaction. For the purposes of thesedefinitions, “acting jointly or in concert” has a similar meaning to that phrase as defined in section
91 of the Securities Act (Ontario) or similar provisions of applicable securities legislation, withnecessary modifications. In the context of these definitions only, it is a question of fact whether aperson is acting jointly or in concert with a dealer- or issuer-restricted person and, without limiting
the generality of the foregoing, every person who, as a result of an agreement, commitment or
understanding, whether formal or informal, with a dealer-restricted person or an issuer-restrictedperson, bids for or purchases any restricted security will be presumed to be acting jointly or inconcert with such dealer- or issuer-restricted person.

Part 2 – Meaning of “selling process has ended”
The definition of “restricted period”, with respect to a prospectus distribution and a “restrictedprivate placement”, refers to the end of the period as the date that the selling process ends andall stabilization arrangements relating to the offered security are terminated. Rule 1.2(6)(a)provides interpretation as to when the selling process is considered to end. As further
clarification, the selling process is considered to end for a prospectus distribution when thereceipt for the prospectus has been issued, the Participant has distributed all securities allocatedto it and, is no longer stabilizing, all selling efforts have ceased and the syndicate is broken.
Selling efforts have ceased when the Participant is no longer making efforts to sell, and there isno intention to exercise an over-allotment option other than to cover the syndicate’s short
Part 1 – Definitions and Interpretation
December 14, 2022

UMIR 1.2-3

position. If the Participant or syndicate subsequently exercises an over-allotment option in an
amount that exceeds the syndicate short position, the selling efforts would not be considered tohave ceased. Securities allocated to a Participant that are held and transferred to the inventory
account of the Participant at the end of the distribution are considered distributed. Subsequentsales of such securities are secondary market transactions and should occur on a marketplacesubject to any applicable exemptions (unless the subsequent sale transaction is a distribution byprospectus). To provide certainty around when the distribution has ended, appropriate steps
should be taken to move the securities from the syndication account to the inventory account of
the Participant.

Part 3 – “Ought Reasonably to Know”
Rule 2.2 prohibits a Participant or Access Person from doing various acts if the Participant orAccess Person “knows or ought reasonably to know” that a particular method, act or practice
was manipulative or deceptive or that the effect of entering an order or executing a trade would
create or could reasonably be expected to create a false or misleading appearance of trading
activity or interest or an artificial price. Rule 2.3 prohibits a Participant or Access Person fromentering an order on a marketplace or executing a trade if the Participant or Access Person“knows or ought reasonably to know” that the entry of the order or the execution of the trade
would result in the violation of various securities or regulatory requirements.
In determining what a person “ought reasonably to know” reference would be made to what a
Participant or Access Person would know, acting honestly and in good faith, and exercising thecare, diligence and skill that a reasonably prudent Participant or Access Person would exercise
in comparable circumstances. In essence, the test becomes what could a Participant or Access
Person have been expected to know if the Participant or Access Person had:•adopted various policies and procedures as required by applicable securities
legislation, self-regulatory entities, UMIR and the Policies; and•conscientiously followed or observed the policies and procedures.

Part 1 – Definitions and Interpretation
December 14, 2022

UMIR 1.2-4

Part 4 - Applicable Regulatory Standards
Rule 7.1 requires each Participant prior to the entry of an order on a marketplace to comply withapplicable regulatory standards with respect to the review, acceptance and approval of orders.
Each Participant that is a dealer must be a member of a self-regulatory entity. Each Participant
will be subject to the by-laws, regulations and policies as adopted from time to time by theapplicable self-regulatory entity. These requirements may include an obligation on the member
to “use due diligence to learn and remain informed of the essential facts relative to every
customer and to every order or account accepted.” While knowledge by a Participant of“essential facts” of every customer and order is necessary to determine the suitability of any
investment for a client, such requirement is not limited to that single application. The exercise ofdue diligence to learn essential facts “relative to every customer and to every order” is a centralcomponent of the “Gatekeeper Obligation” embodied within the trading supervision obligation
under Rule 7.1 and 10.16. In addition, securities legislation applicable in a jurisdiction may
impose review standards on Participants respecting orders and accounts. The regulatory
standards that may apply to a particular order may vary depending upon a number ofcircumstances including:•

the requirements of any self-regulatory entity of which the Participant is a member;•the type of account from which the order is received or originated; and•the securities legislation in the jurisdiction applicable to the order.

Part 1 – Definitions and Interpretation
December 14, 2022

UMIR 1.2-5

Defined Terms:

NI 14-101 section 1.1(3) – “jurisdiction”, “securities legislation" and “securities regulatory authority”
NI 21-101 section 1.1 – “order” and “self-regulatory entity”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “best ask price”, “best bid price”, “connected security”, “consolidated
market display”, “dealer-restricted person”, “derivative”, “Electronic Trading Rules”, “Exchange”, “issuerrestricted person”, “last sale price”, “limit order”, “listed security”, “Market Operation Instrument”, “market order”,“marketplace”, “Marketplace Regulator”, “Marketplace Rule”, “offered security”, “Participant”, “Policy”, “QTRS”,“quoted security”, “restricted period”, “restricted private placement”, “restricted security”, “standard trading unit”,“trading day” and “UMIR”

Related Provisions:

UMIR section 1.2(2) – “person” and “trade”
UMIR section 1.1 – definitions of “last sale price” and “standard trading unit”
UMIR section 2.2. – Manipulative and Deceptive Activities
UMIR section 2.3 – Improper Orders and Trades
UMIR section 6.3 – Exposure of Client Orders
UMIR section 6.4 – Trades to be on a Marketplace
UMIR section 7.1 – Trading Supervision Obligations
UMIR section 7.7 – Trading During Certain Securities Transactions
UMIR section 8.1 – Client-Principal Trading
UMIR section 9.1 – Regulatory Halts, Delays and Suspensions of Trading
UMIR section 10.16 – Gatekeeper Obligations of Directors, Officers and Employees of Participants and Access
Persons

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments that came into force
on May 9, 2005 to add subsections (6) and (7) to section 1.2 and to add Parts 1 and 2 of Policy 1.2, related toamendments to the market stabilization rules in UMIR 7.7. See Market Integrity Notice 2005-007 –“Amendments Respecting Trading During Certain Securities Transactions” (March 24, 2005).
Effective April 1, 2005, the applicable securities commissions approved amendments to add Part 3 (“Ought
Reasonably to Know”) and Part 4 (“Applicable Regulatory Standards”) of Policy 1.2. See Market Integrity Notice
2005-011 – “Provisions Respecting Manipulative and Deceptive Activities” (April 1, 2005).
In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities commissions
approved an amendment to section 1.2 that came into force on June 1, 2008 to make editorial changes. See
Footnote 1 in Status of Amendments.
Effective January 8, 2010, the applicable securities commissions approved amendments to subsection (6) ofsection 1.2 and to add subsection (8) to section 1.2, related to amendments to the market stabilization rules in
UMIR 7.7. See IIROC Notice 10-0006 – “Provisions Respecting Trading During Certain Securities
Transactions” (January 8, 2010).
Effective February 1, 2011, the applicable securities commissions approved amendments to add the reference
to “Rule 6.4” to subsection (3) of section 1.2. See IIROC Notice 09-0328 – “Provisions Respecting
Implementation of the Order Protection Rule” (November 13, 2009).
Effective March 1, 2013, the applicable securities commissions approved amendments to renumber clause (c)of subsection 1.2(1) as clause (d) and to add new clause (c) to reference the CSA’s Electronic Trading Rules.
See IIROC Notice 12-0363 – “Provisions Respecting Electronic Trading” (December 7, 2012).
Effective December 9, 2013, the applicable securities commissions approved amendments to the French
version of UMIR. See IIROC Notice 13-0294 “Amendments to the French version of UMIR” (December 9,2013).
Effective September 18, 2015, the applicable securities commissions approved amendments to subsection 5
and 8 of UMIR 1.2. See IIROC Notice 15-0211 - Notice of Approval – “Provisions Respecting UnprotectedTransparent Marketplaces and the Order Protection Rule” (September 18, 2015).
Effective December 14, 2022, the applicable securities commissions approved amendments to subsections
1.2(2) and 1.2(8). See IIROC Notice 22-0140– “Amendments Respecting the Trading of Derivatives on aMarketplace” (September 15, 2022).

Guidance:

See Market Integrity Notice 2005-026
Canadian Currencies” (July 28, 2005).

Part 1 – Definitions and Interpretation
December 14, 2022

- “Guidance – Securities Trading on Marketplaces in U.S. and

UMIR 1.2-6

Universal Market Integrity Rules

Rules & Policies

1.3 Transitional Provision(1) The Corporation is the corporation continuing from the amalgamation effective
January 1, 2023 of the Investment Industry Regulatory Organization of Canada
and the Mutual Fund Dealers Association of Canada and as a result, for greatercertainty:(i) any reference in these Rules to the Corporation includes the Investment
Industry Regulatory Organization of Canada prior to January 1, 2023;(ii) any person subject to the jurisdiction of the Investment Industry Regulatory
Organization of Canada prior to January 1, 2023 remains subject to thejurisdiction of the Corporation in respect of any action or matter that
occurred while that person was subject to the jurisdiction of the Investment
Industry Regulatory Organization of Canada at the time of such action or
matter; and(iii) the provisions of the articles, by-laws, rules, policies and any other
instrument or requirement prescribed or adopted by the Investment
Industry Regulatory Organization of Canada pursuant to such articles, bylaws, rules or policies, and any approval or ruling granted or issued by theInvestment Industry Regulatory Organization of Canada, in each casewhile a person was subject to the jurisdiction of the Investment Industry
Regulatory Organization of Canada shall continue to apply to that personin accordance with their terms and may be enforced by the Corporation.
(2) The Corporation shall continue the regulation of persons subject to thejurisdiction of the Investment Industry Regulatory Organization of Canada thatwas formerly conducted by the Investment Industry Regulatory Organization of
Canada, including any enforcement or review proceedings, in accordance withthe by-laws, rules and policies of the Investment Industry Regulatory
Organization of Canada, and any other instrument or requirement prescribed or
adopted by the Investment Industry Regulatory Organization of Canada
pursuant to such by-laws, rules or policies in each case in effect at the time ofany action or matter that occurred while that person was subject to thejurisdiction of the Investment Industry Regulatory Organization of Canada.

Defined Terms:

NI 14-101 section 1.1(3) – “jurisdiction
UMIR section 1.2(2) – “person”

Part 1 – Definitions and Interpretation
January 1, 2023

UMIR 1.3-1

Universal Market Integrity Rules

Rules & Policies

PART 2 – ABUSIVE TRADING
2.1

Just and Equitable Principles - Repealed

2.1

Specific Unacceptable Activities(1)

Without limiting the generality of any other Rule, a Participant or Access Person
shall not:(a)enter into a transaction for the purpose of rectifying a failure in connection
with a failed trade prior to the time that a report must be filed in accordancewith Rule 7.10 if the Participant or Access Person knows or ought reasonably
to know that such transaction will result in a failed trade; or(b)when trading a security on a marketplace that is subject to Marketplace
Trading Obligations, intentionally entering on that marketplace on a particular
trading day two or more orders which would impose an obligation on the
person with Marketplace Trading Obligation to(i)execute with one or more of the orders, or(ii)purchase at a higher price or sell at a lower price with one or more of
the orders

in accordance with the Marketplace Trading Obligations that would not be
imposed on the person with Marketplace Trading Obligations if the orders
had been entered on the marketplace as a single order or entered at thesame time.
(2)

(3)

Without limiting the generality of any other Rule, a Participant shall not:(a)directly or indirectly use another person to effect a trade other than on amarketplace in circumstances when an exemption is not available for theParticipant to complete the trade other than on a marketplace in accordancewith Rule 6.4;(b)make a pattern of trading in a particular security with knowledge of an
expression of interest by a client in that particular security; or(c)without the specific consent of the client, enter client orders and principal
orders in such a manner as to attempt to obtain execution of a principal orderin priority to the client order.

A Participant or Access Person shall not enter an order on a marketplace that is
intended to execute as a pre-arranged trade or an intentional cross without theprior approval of a Market Regulator if the pre-arranged trade or intentional crosswould be undertaken at a price that will be:(a)less than the lesser of 95% of the best bid price and the best bid price less 10
trading increments; or(b)more than the greater of 105% of the best ask price and the best ask priceplus 10 trading increments.

Part 2 – Abusive Trading
July 27, 2023

UMIR 2.1-1

(4)As a condition for granting approval of the pre-arranged trade or intentional crossfor the purposes of subsection (3), the Market Regulator may require theParticipant or Access Person to enter a series of orders on one or more protectedmarketplaces over a period of time considered reasonable by the Market Regulator
in order to move the market price to the price at which the pre-arranged trade orintentional cross will occur and that time period will generally be not less than:(a)

5 minutes if the price variation from the best ask price or best bid price, asapplicable, is more than 5% but less than 10%; and(b)

10 minutes if the price variation is 10% or more.

POLICY 2.1 – JUST AND EQUITABLE PRINCIPLES - REPEALEDDefined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “best ask price”, “best bid price”, “bypass order”, “client order”,“designated trade”, “disclosed volume”, “Exchange”, “failed trade”, “intentional cross”, “Market
Regulator”, “marketplace”, “Marketplace Trading Obligations”, “Participant”, “pre-arranged trade”,“principal order”, “protected marketplace”, “Requirements”, “trading day” and “trading increment”
UMIR section 1.2(2) – “person” and “trade”

Related Provisions:

UMIR section 7.10 and Part 2 of Policy 5.3

Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment to replaceclause (d) at the end of Part 1 of Policy 2.1. See Market Integrity Notice 2007-002 – “Provisions
Respecting Competitive Marketplaces” (February 26, 2007).
Effective May 16, 2008, the applicable securities commissions approved amendments to Policy 2.1 toreplace the opening sentence of the last paragraph of Part 1 of Policy 2.1 and to replace Part 2 of Policy
2.1. See Market Integrity Notice 2008-008 – “Provisions Respecting Off-Marketplace Trades” (May16, 2008).
On October 15, 2008, the applicable securities commissions approved amendments to Part 1 of Policy
2.1 that came into force on October 14, 2008 to delete and replace the second paragraph, to include areference to failed trades. See IIROC Notice 08-0143 – “Provisions Respecting Short Sales andFailed Trades” (October 15, 2008).
Effective August 26, 2011, the applicable securities commissions approved amendments to delete andreplace clause (d) of Part 1 of Policy 2.1, to replace the term “Market Maker Obligations” with the new
defined term “Marketplace Trading Obligations”. See IIROC Notice 11-0251 – “Provisions Respecting
Market Maker, Odd Lot and Other Marketplace Trading Obligations” (August 26, 2011).
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French version of UMIR”(December 9, 2013).
Effective September 18, 2015, the applicable securities commissions approved amendments to Part 2of Policy 2.1. See IIROC Notice 15-0211 - Notice of Approval – “Provisions Respecting UnprotectedTransparent Marketplaces and the Order Protection Rule” (September 18, 2015).
Effective September 1, 2016, the applicable securities commissions approved amendments to repeal
Rule 2.1 of UMIR and Policy 2.1, with the substance of the Policy incorporated into the new Rule 2.1“Specific Unacceptable Activities”. See IIROC Notice 16-0122 – “Implementation of the consolidated
IIROC Enforcement, Examination and Approval Rules” (June 9, 2016).
Effective July 27, 2023, the applicable securities commissions approved housekeeping amendments to
UMIR to correct inaccurate referencing and typographical mistakes and to ensure consistency between
the English and French versions of UMIR. See CIRO Bulletin 23-0107 - "Housekeeping Amendments
to UMIR" (July 27, 2023).

Guidance:

See Market Integrity Notice 2005-027 - “Guidance – “Advantages” to the Purchaser of a Security”(July 29, 2005).

Partially Repealed Guidance:
Part 2 – Abusive Trading
July 27, 2023

See IIROC Notice 11-0043 - “Guidance on “Locked” and “Crossed” Markets” (February 1,
UMIR 2.1-2

2011). Questions 2, 5 and 9 of Notice 11-0043 were repealed and replaced effective January 2,
2018 by IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).
Disciplinary Proceedings:

In the Matter of Ronald David Johnson (“Johnson”) (September 13, 2002) OOS 2002-003
Facts – During the period April 1999, to May 1999, Johnson, an Approved Person of the Alberta
Stock Exchange employed by Canaccord Capital Corporation, participated in the distribution ofshares of a private placement. The issuer of the private placement relied on a “close friends andbusiness associates” exemption under the Securities Act (Alberta) to distribute the securities.
Johnson place five clients in the private placement notwithstanding that the clients could notproperly rely on the “close friends and business associates” exemption.
Disposition – Johnson knew or should have known that the “close friends and business associates”
exemption provided by the securities legislation was not applicable in the case of the five clients withwhom he placed the securities. In doing so, he engaged in conduct that was unbecoming andinconsistent with just and equitable principles of trade which was detrimental to the public interest.
Requirements Considered – Alberta Stock Exchange By-laws 8.27 and 16.01A. Comparable UMIR
Provision - Rule 2.1
Sanction - $12,000 fine and costs of $7,500

Disciplinary Proceedings:

In the Matter of Norman Karl Jeske (“Jeske”) (December 12, 2002) OOS 2002-010
Facts – During the period of July 1, 1998 to February 1, 1999, Jeske, an investment advisor at
Dominick & Dominick Securities Inc., in the course of acting for a company engaged in a normal
course issuer bid failed to exercise due diligence in relation to the entry of orders by the company
for the purchase of its shares, including from accounts related to or affiliated with the company andits insiders.
Disposition – In failing to exercise due diligence in relation to the entry of orders, Jeske’s conduct or
method of business was inconsistent with just and equitable principles of trade and detrimental tothe interests of public.
Requirements Considered – VSE Policy 21.10, VSE Rules B.4.16 and F.2.08, VSE By-law 5.01(2).
Comparable UMIR Provision - Rule 2.1.
Sanction - $12,500 fine and costs of $1,000; disgorgement of $2,392 in gains; suspended fromaccess to the Toronto Stock Exchange for 30 days.

Disciplinary Proceedings:

In the Matter of Luke Roger Beresford Smith (“Smith”) (October 24, 2002) OOS 2002-011
Facts – Between October 21, 1996 and December 21, 1996, Smith, an Investment Advisor with
C.M. Oliver & Co. Ltd, effected or participated in trades on behalf of three client accounts who
engaged in a pattern of initiating buy and sell orders for a particular security and at substantially thesame time and at substantially the same price between the clients’ accounts.
Disposition – The trades amongst the clients’ accounts could have created the appearance of an
artificial market that could have unduly disturbed the normal market condition, and could havecreated a misleading appearance of trading activity for the particular security. Smith failed in his role
as a gatekeeper and his conduct was inconsistent with just and equitable principles of trade.
Requirements Considered – VSE By-law 5.01(2). Comparable UMIR Provision - Rule 2.1 andPolicy 2.1, reference made to “gatekeeper function” (Rule 10.16 effective April 1, 2005)
Sanction - $7,500 fine and costs of $2,500.

Disciplinary Proceedings:

In the Matter of Garett Steven Prins (“Prins”) (April 1, 2003) OOS 2003-001
Facts – On several occasions between November 22, 2001 and July 18, 2002, Prins informed aregistered trader at another dealer of pending client orders for particular securities. The registeredtrader used this information to enter beneficial trades in the particular securities.
Disposition – Prins acted contrary to just and equitable principles of trade when he disclosed
information of pending client trades to a trader at another dealer.
Requirements Considered – TSX Rule 7-106(1)(b) and Rules 2.1(1) and 4.1(1)(c)Sanction - $50,000 fine and costs of $15,000; Suspended from access to the Toronto Stock
Exchange for 3 months

Disciplinary Proceedings:

In the Matter of Douglas Francis Corrigan (“Corrigan”) (May 28, 2003) OOS 2003-002
Facts - Corrigan, an investment advisor at Dominick & Dominick Securities Inc. was assigned theaccount of Client X, an insider of Tree Brewing Co. Ltd. (“Tree Brewing”), a VSE-listed issuer.
Between August 1, 1998 and March 31, 1999, Corrigan effected or participated in trades of sharesof Tree Brewing on behalf of Client X which involved a pattern of uneconomic and repetitive tradingwhereby Client X sold and subsequent re-purchase of a comparable number of shares of Tree
Brewing for the purpose of deferring payment for the securities traded.

Part 2 – Abusive Trading
July 27, 2023

UMIR 2.1-3

Disposition - Corrigan had an obligation to closely monitor the trading by the client and use due
diligence to learn the essential facts each order he accepted. In failing to discharge his due
diligence obligations and failing to recognize the “red flags” Duke failed to discharge his“gatekeeper” obligation and engaged in conduct which was inconsistent with just and equitableprinciples of trade.
Requirements Considered – VSE By-law 5.01(2). Comparable UMIR Provision - Rule 2.1 andPolicy 2.1, reference made to “gatekeeper function” (Rule 10.16 effective April 1, 2005)
Sanction - $10,000 fine and costs of $3,000; disgorgement of $5,492 in gains
Disciplinary Proceedings:

In the Matter of Dean Duke (“Duke”) (May 28, 2003) OOS 2003-003
Facts – Duke, a trader at Canaccord Capital Corporation was assigned the account of Client X, aninsider of Tree Brewing Co. Ltd. (“Tree Brewing), a VSE-listed issuer. Between August 1, 1998 andMarch 31, 1999, Duke effected or participated in trades of shares of Tree Brewing on behalf ofClient X which involved a pattern of uneconomic and repetitive trading whereby Client X sold andsubsequent re-purchase of a comparable number of shares of Tree Brewing for the purpose ofdeferring payment for the securities traded.
Disposition – Duke had an obligation to closely monitor the trading by Client X and use due
diligence to learn the essential facts of each order he accepted. In failing to discharge his due
diligence obligations and failing to recognize the “red flags” Duke failed to discharge his“gatekeeper” obligation and engaged in conduct which was inconsistent with just and equitableprinciples of trade.
Requirements Considered – VSE By-law 5.01(2). Comparable UMIR Provision - Rule 2.1 and Policy
2.1
Sanction - $20,000 fine and costs of $3,000; disgorgement of $3,633.57 in gains

Disciplinary Proceedings:

Rule 2.1(1) was considered In the Matter of Frank Patrick Greco (“Greco”) (May 28, 2003)
Decision 2003-004. See Disciplinary Proceedings under Rule 4.1.

Disciplinary Proceedings:

In the Matter of Garnet Glen Ferguson (“Ferguson”) (November 6, 2003) OOS 2003-008
Facts – On September 25, 2000, Ferguson, a registered representative, while in possession ofmaterial non-public information, entered into a pre-arranged transaction with a promoter of an issuerof a Canadian Venture Exchange Inc. listed stock to purchase shares of the company on behalf of
six of his clients. The trade materially upticked the price of the stock. Subsequently, between
October 2-6, 2000, and prior to the material information respecting the issuer being partiallydisclosed generally, Ferguson sold the shares of the company in “solicited” sales for three of theclients at a significant premium.
Disposition – In purchasing securities on behalf of his clients while in possession of material
information, which he knew or ought to have know had not been generally disclosed, and for do soin the context of effecting a new high trade where he ought to have known that the effect of such apurchase would be to create an abnormal market condition for that security, Ferguson’s conduct
was inconsistent with just and equitable principles of trade and detrimental to the public interest.
Requirements Considered – CDNX Rules F.2.18(4)(a) and F.2.01(2). Comparable UMIR Provision Rule 2.1 and Policy 2.1.
Sanction - $15,000 fine and costs of $2,500; disgorgement of $1,095 in gains.

Disciplinary Proceedings:

In the Matter of Brian Alexander Kaufman (“Kaufman”) (November 6, 2003) OOS 2003-009
Facts – Between July 2000 and February 2001, Kaufman, a registered representative, caused aseries of trades to be transacted on behalf of his client who was engaged in suspicious trading
activities which included perceived undeclared short sales, uneconomical trading and up-tickedpurchases in thinly traded securities. Despite knowing these facts, Kaufman appeared to executesell orders without reasonable knowledge that the apparent long sales were in fact covered by freely
tradeable shares.
Disposition – The failed settlements, uneconomic trading and market dominance in a thinly tradedsecurity by the client ought to have put Kaufman on a heightened state of alert for possible market
abuses. Kaufman should have not continued to execute sales for his clients without ensuring thatthe accounts were long or without credible evidence that his clients held freely tradeable shares inother accounts to cover those sales. In failing to identify these red flags Kaufman failed to act as a“gatekeeper” and engaged in conduct which was inconsistent with just and equitable principles oftrade and detrimental to the public interest.
Requirements Considered – CDNX Rules F.1.01(1), F.2.01(2) and E.1.01.
Provision - Rule 2.1 and Policy 2.1.

Comparable UMIR

Sanction - $10,000 fine and costs of $4,000, disgorgement of $1,363.82 in gains; strict supervisionPart 2 – Abusive Trading
July 27, 2023

UMIR 2.1-4

for 6 months; successful completion of the Conduct and Practices Handbook examination.
Disciplinary Proceedings:

In the Matter of Linda Grace Malinowski (“Malinowski”) (November 26, 2003) OOS 2003-011
Facts – In her capacity as sales assistant, Malinowski was responsible for entering orders for one
stock on behalf of clients and at the direction of the investment advisor for whom she worked.
Between February 1 and June 9 of 2000 she was responsible for entering unsolicited buy orders onbehalf of clients that were alleged to be engaged in trading which created a false and misleading
appearance of trading activity in the stock and in certain instances, created artificial prices.
Malinowski raised concerns about the trading of the clients, but was told by her IA that she shouldn’t
be concerned. She did not escalate the matter further and continued to take orders from the clients.
Disposition - Persons entering orders on behalf of clients have a gatekeeper responsibility to guard
against entering orders for clients who may appear to be engaging in manipulative and deceptive
trading. Malinowski failed in her duty as gatekeeper and hence constituted conduct contrary to justand equitable principles of trade.
Requirements Considered – Section 17.09(1)(b) of the General By-law of the TSX and Rule 7106(1)(b) of the Rules of the TSX. Comparable UMIR Provision – Rule 2.1(1).
Sanction - $10,000 fine; successful completion of the Conduct and Practices Handbook
examination.

Disciplinary Proceedings:

In the Matter of David Avery Little (“Little”) (December 22, 2003) OOS 2003-014
Facts – Between July 4 and July 12, 2002, Little, a registered representative at Yorkton Securities
Inc. (“Yorkton”), instructed traders at Yorkton to jitney sell orders for EQT shares held by Yorkton inan Inventory Account. Shortly after the execution of each jitney sell order, Little caused an order tobe entered on behalf of a client, who was also an insider of EQT (“Related Client”), to purchasesmall quantities of EQT shares at prices in excess of the price at which Little had sold the shares.
Five of these Related Client orders and trades entered and executed during the relevant period
produced up ticks.
Disposition – When a registrant acts for an insider of an issuer in whose securities trades are made,the registrant must exercise a higher level of due diligence to learn the essential facts relative to theorders. In failing to take greater care when accepting and executing unsolicited orders for a Related
Client Little failed to act as a “gatekeeper” and failed to act in accordance with just and equitableprinciples of trade.
Requirements Considered – Rules 2.1(1) and 10.4(1)(a).
Sanction - $12,500 fine and costs of $2,500.

Disciplinary Proceedings:

In the Matter of Kai Tolpinrud (“Tolpinrud”) (January 16, 2004) OOS 2004-001
Facts – Canaccord Capital Corporation employed Tolpinrud to trade for institutions, quasiinstitutional clients, and corporate clients and at the same time permitted him to trade his personalaccount and inventory accounts. In reliance on this arrangement, between March 1, 2001 andMarch 11, 2002 Tolpinrud took advantage of client orders and information when acting as agent forthe purchase and sale of securities to commit numerous infractions and contraventions including
frontrunning, trading opposite his clients, improper client-principal trading, failing to give client orders
priority when he entered client and non-client orders and other infractions.
Disposition – Tolpinrud engaged in trading practices which contravened the requirements of the
CDNX and the TSE and were inconsistent with just and equitable principles of trade and detrimental
to the interests of the public.
Requirements Considered – TSE Rule 4-405(1), CDNX Rules C.2.17, F.2.01, F.2.03, F.2.04, F.2.05,
F.2.10(2)(f), F.2.18 (8), G.3.01(6). Comparable UMIR Provisions – Rule 2.1, 2.2, 4.1, 5.3.
Sanction - $110,000 fine and costs of $21,500; disgorgement of $29,925 gain; permanent
withdrawal of access to the TSX-VN, TSX and all other marketplaces regulated by RS.

Disciplinary Proceedings:

In the Matter of Gerald Douglas Phillips (“Phillips”) (February 26, 2004) SA 2004-002
Facts – On June 26, 2003, Phillips, a registered representative entered a client market sell order at
a $0.70 limit in the exchange book even though there were pending buy orders in the TSX’s special
terms book against which the client’s order could have traded at a better price.
Disposition – In failing to make an effort to fill the client’s market order at the better price offered in
the special terms book, Phillips caused his dealer to breach its best price obligation to the client andacted in a manner which was inconsistent with just and equitable principles of trade.
Requirements Considered – Rules 2.1(1)(a), 5.2 and 10.4(1)(a).
Sanction - $10,000 fine and costs of $3,500.

Disciplinary Proceedings:

Part 2 – Abusive Trading
July 27, 2023

In the Matter of Louis Anthony De Jong (“DeJong”) and Dwayne Barrington Nash (“Nash”)

UMIR 2.1-5

(July 29, 2004) Decision 2004-004
Facts – DeJong and Nash were both employees of Credit Suisse First Boston Canada Inc.
(“CSFB”). Client X advised DeJong that he was interested in buying a large block of BCE shares
which CSFB recently acquired in an unrelated transaction. In order to deliver the shares to client X
at the agreed upon price, DeJong and Nash made improper use of a CSFB error account todocument a loss to CSFB and sold the shares to client X in an improper off-marketplace transaction.
RS alleged that Nash and DeJong violated Rule 2.1(1), for which they were liable under Rule10.4(1)(a).
Held - While Rule 10.4(1)(a) extends liability to employees for breaches of Rule 2.1, to the extent
that the acts of DeJong and Nash fell factually within Rule 6.4 of UMIR, RS lacked the jurisdiction
and authority to extend liability to DeJong and Nash under Rule 10.4(1)(a).
Requirements Considered – Rules 2.1(1), 6.4 and 10.4(1)(a).
Disposition – charges against DeJong and Nash dismissed.
Disciplinary Proceedings:

In the Matter of CIBC World Markets Inc., (“CIBC”) Scott Mortimer and Carl Irizawa (December
21, 2004) SA 2004-008
Facts – From March to December, 2002, a group of related clients with accounts at CIBC engaged
in suspicious trading in stocks and warrants listed on the TSX and the TSX Venture Exchange. The
trading was carried out through numerous accounts held by the client group at CIBC, its affiliates
and an unrelated investment dealer, and involved the alleged manipulation of illiquid derivative
securities through a series of set-up trades entered through a Direct Market Access account at CIBC
and another dealer and crosses between accounts held by the client group at CIBC.
Disposition – Both the investment advisor and his sales assistant failed to fulfill their respective
gatekeeper responsibilities by failing to recognize the “red flags” upon entry of the crosses and upon
review of the crosses the day after they were conducted. The “red flags” ought to have caused themto further scrutinize the clients’ trading and escalate their issues of concern to supervisorypersonnel.
A Participant is responsible for ensuring that it adequately supervises all trading, including Direct
Market Access trading. The policies and procedures employed by CIBC were not adequate in thatthey did not focus on the potentially manipulative or deceptive nature of the client trading and as aresult CIBC failed to recognize the “red flags” posed by the nature of the related clients trading.
Requirements Considered – Sections 2-401(5) and 7-106(1)(b) of the Toronto Stock Exchange
Rules and Rule 2.1(1), 7.1(1) and Policy 7.1.
Sanction CIBC of staff

Disciplinary Proceedings:$700,000 fine and costs of $92,500; undertakings involving strict supervision and training

Scott Mortimer -$50,000 fine and costs of $15,000

Carl Irizawa -$20,000 fine and costs of $7,500.

In the Matter of Glen Grossmith (“Grossmith”) (July 18, 2005) SA 2005-004
Facts – In February of 2005, Grossmith, a trader employed with UBS Securities Canada Inc. (“UBS
Canada”) tried to conceal trading improprieties conducted by another trader at UBS Canada’s US
affiliate by altering an existing Canadian client trade ticket, creating a false and misleading “chat”
communication and failing to be forthcoming regarding these circumstances during UBS Canada’s
investigation of the trading irregularities.
Disposition – Grossmith’s alteration of a trade ticket and failure to act in a forthcoming manner with
UBS Canada’s compliance department’s investigation of the trading irregularities constituted
conduct inconsistent with just and equitable principles of trade and resulted in UBS Canada violating
certain audit trail requirements under UMIR.
Requirements Considered – Rules 2.1(1)(a), 10.3(4), 10.4(1)(a) and 10.11(1).
Sanction - $75,000 fine and costs of $25,000; suspension from RS regulated marketplaces for 3
months; 6 months strict supervision.

Disciplinary Proceedings

In the Matter of Ricardo Mashregi (“Mashregi”) (October 14, 2005) DN 2005-007
Facts – Between October 2003 and February 2005, Mashregi, a registered trader at Dundee
Securities Corporation engaged in a practice which involved the entry of anonymous non-client
overlapping orders (buy side order was higher than or equal to the price of the sell order) on bothsides of the market prior to 9:28 a.m. and subsequently canceling or changing one or both of theorders between 9:28 a.m. and the opening of the market. By entering orders in this manner,
Mashregi positioned himself for a guaranteed fill in the opening session and avoided the application

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UMIR 2.1-6

of the TSX trading mechanism that allocates which orders will receive a complete fill at the opening.
Disposition – The positioning of anonymous non-client overlapping orders in order to guarantee a fillin the opening session and avoid the application of the TSX trading mechanism that allocates which
orders will receive a complete fill at the opening constituted conduct which was contrary to just andequitable principles of trade.
Requirements Considered – Rule 2.1.
Sanction - $50,000 fine and costs of $10,000.
Disciplinary proceedings:

In the Matter of Ian Scott Douglas (“Douglas”) (December 14, 2005) DN 2005-009
Facts – Between July 2003 and December 2003, Douglas, a junior trader at Dundee Securities
Corporation engaged in a practice which involved the entry of anonymous non-client overlappingorders (buy side order was higher than or equal to the price of the sell order) on both sides of themarket prior to 9:28 a.m. and subsequently canceling or changing one or both of the orders between
9:28 a.m. and the opening of the market. By entering orders in this manner, Douglas positioned
himself for a guaranteed fill in the opening session and avoided the application of the TSX tradingmechanism that allocates which orders will receive a complete fill at the opening.
Disposition – The positioning of anonymous non-client overlapping orders in order to guarantee a fillin the opening session and avoid the application of the TSX trading mechanism that allocates which
orders will receive a complete fill at the opening constituted conduct which was contrary to just andequitable principles of trade.
Requirements Considered – Rule 2.1.
Sanction – $30,000 fine and costs of $15,000.

Disciplinary Proceedings:

In the Matter of Dale Alfred Michaud (“Michaud”) (January 11, 2006) DN 2006-001
Facts – On October 10, 2003, Michaud, a trader at Canaccord Capital Corporation received anorder to buy 1 million shares of a TSXV issuer at $0.15 on behalf of a number of client and nonclient accounts. The buy order was to be sent to a Jitney Dealer to be executed as an arranged
cross with accounts at the Jitney Dealer. Shortly after placing the buy order with the Jitney Dealer,and prior to the execution of the arranged cross, Michaud entered a non-client day order to buy
10,000 shares of the issuer at $0.16 at a time when the prevailing bid price for the issuer was $0.18.
Disposition – By entering his buy order at a price which was lower than the prevailing bid price at atime when he knew or ought to have known that the order would have to be “taken out” before theJitney Dealer could execute the cross, Michaud acted contrary to just and equitable principles oftrade.
Requirements Considered – Rule 2.1.
Sanction - $15,000 fine and costs of $10,000; disgorgement of $210 gain.

Disciplinary Proceedings:

In the Matter of Margaret Alice Coleman (“Coleman”) and Judy Gail Koochin (“Koochin”)(April 5, 2006) DN 2006-002
Facts – Between June 24, 2004 and September 30, 2004, Coleman, a registered representative andTrading Officer at a CIBC World Markets Inc. (“CIBC WM”) branch and Koochin, a registered futurescontract representative at the same branch, entered a series of buy orders for a TSXV issuer onbehalf of a client who had an interest in maintaining the market price of the issuer. During therelevant period, the client submitted 27 orders for the purchase of the issuer’s shares in a mannerthat suggested that the client was maintaining the market price within a pre-determined range. In all
but two instances (where orders were entered by a trading assistant) Koochin or Coleman submitted
the orders to the TSXV by means of an electronic connection to the computerized ordermanagement and routing system of CIBC WM.
Disposition – In failing to recognize the “red flags” associated with the pattern of orders submitted
by the client and for entering orders they knew or ought to have known reasonably could have been
expected to create an artificial price in the shares, Koochin and Coleman’s conduct was contrary tojust and equitable principles of trade.
Requirements Considered – Rule 2.1
Sanction –Coleman: $150,000 fine and costs of $13,125; 6 months strict supervision.
Koochin: $75,000 fine and costs of $6,562.50; 6 months strict supervision.

Disciplinary Proceedings:

In the Matter of Kevin Moorhead (“Moorhead”) (May 22, 2008) DN 2008-001
Facts – Between August 29, 2005 and October 27, 2005, Moorhead and/or his assistant, on
Moorhead’s instructions, entered orders on a marketplace for certain securities with the intention of
establishing an artificial and/or a high closing bid price in order to improve the daily profit and loss

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UMIR 2.1-7

position of shares held in Moorhead’s inventory account and/or to assist a trader at another firm toincrease the daily profit or reduce the daily loss in his inventory account.
Disposition – By entering orders on a marketplace that were not justified by any real demand for the
securities Moorhead knew that his order entry activity would create, or could reasonably be
expected to create, an artificial price for the securities contrary to Rule 2.2 and Policy 2.2 of UMIR.
Requirements Considered – Rule 2.2(1), 2.2(2)(b) and Policy 2.2.
Sanction – $40,000 fine and costs of $10,000 and suspension from all RS regulated marketplaces
for three months.
Disciplinary Proceedings:

In the Matter of Tony D’Ugo (“D’Ugo”) (April 6, 2010) DN 10-0093
Facts – During the period from January 21 to February 13, 2008, D’Ugo, a registered representative
at BMO InvestorLine Inc., entered orders and executed trades in shares of a company on the TSX
Venture Exchange for a client and his related accounts with the intention of keeping the closing
price of the security at or above $3.00 per share, so that the client would avoid margin calls fromsome firms that would be made if the price fell below $3.00. D’Ugo also accepted trading
instructions in respect of three client accounts from a person not authorized in writing to provide
such instructions.
Disposition – D’Ugo entered orders and executed trades for a client and his associates that he knew
or ought to have known created or could reasonably have been expected to create, an artificial priceand/or bid for the security contrary to UMIR 2.2(2)(b), 10.4(1) and 10.16(1)(b) and he accepted
trading instructions in respect of three client accounts from a person not authorized in writing toprovide such instructions contrary to UMIR 2.1(1) and 10.4(1).
Requirements Considered – Rules 2.1, 2.2(2)(b), 10.4(1) and 10.16(1)(b).
Sanctions – D’Ugo was fined $40,000, ordered to pay $15,000 in costs, suspended from access to
IIROC-regulated marketplaces for 2 years from March 15, 2010, required to re-write and complete
the Conduct and Practices Handbook examination prior to resuming his employment with abrokerage firm and is subject to one year of close supervision by his employer firm when resuming
employment with a brokerage firm.

Disciplinary Proceedings:

In the Matter of Clark Alexander Squires (“Squires”) (October 6, 2010) DN 10-0263
Facts – On February 11, 2009, while employed as a registered representative at Brant Securities
Ltd. (“Brant”), Squires solicited sell orders for three clients in the securities of a publicly-traded
company listed on the TSX while also holding the position of director with the company. Squires did
not inform the clients or his firm’s compliance department that he was in possession of material
undisclosed information about the company when soliciting the sell orders. The company issued apress concerning the material information after the sell orders were executed. Brant’s compliancedepartment thereafter identified the sales of the security in the client accounts and cancelled thetransactions with the concurrence of Squires.
Disposition – Under the terms of a Settlement Agreement, Squires admitted that he failed to transact
his business in a manner that was open, fair and in accordance with just and equitable principles oftrade when he traded on information that was not generally available to other market participants
and by failing to inform his compliance department of the circumstances.
Requirements Considered – Rules 2.1, and 10.3(4).
Sanctions – Squires agreed to a $20,000 fine and $5,000 in costs.

Disciplinary Proceedings:

In the Matter of National Bank Financial (“NBF”), Paul Clarke (“Clarke”) and Todd O’Reilly(“O’Reilly”) (January 21, 2011) DN 11-0029 and DN 11-0030
Facts – Between April 2006 and June 2007, Clarke, a Registered Representative, and O’Reilly, an
Investment Representative, both employed at the NBF Halifax retail branch (the “Halifax
Representatives”), placed orders through the Montreal Retail Trade Desk rather than through NBF’s
automated order entry system. NBF’s automated system required a complete record of audit trail
requirements for order entry. The Montreal Retail Trade Desk, however, routinely accepted orders
from the Halifax Representatives without identifying the client accounts for which the orders wereplaced and did not keep adequate records of the required audit trail information. Among otherthings, trade tickets were inadequate as they were not time-stamped or failed to include the orderprice and/or quantity and in certain cases trade tickets were not available. In addition, the Halifax
Representatives were permitted to hold trades executed through the Montreal Retail Trade Desk ina firm inventory account (the “Accumulation Account”) for up to 30 days without allocating them toclient accounts as distinct from the standard T+3 settlement date stated in NBF’s policy andprocedure. The ability to enter orders without identifying a client account and to delay allocation toclient accounts allowed clients of the Halifax Representatives to access firm capital for up to 30
days, caused uncertainty regarding ownership of certain positions, and resulted in the ability of thePart 2 – Abusive Trading
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UMIR 2.1-8

Halifax Representatives to grant preferential treatment to their clients.
Although supervision failings with respect to both the Halifax Representatives and Montreal Retail
Trade Desk were continually highlighted by NBF during the relevant period, corrective measures
were not effected in a timely manner. Subsequent to an IIROC investigation, NBF overhauled theretail trade desk compliance practices and procedures regarding the Accumulation Account andgoverning the Montreal Retail Trade Desk. There were no client complaints or losses claimed as aresult of NBF’s conduct, nor unpaid accounts by any client and NBF suffered no losses as a result of
the exposure to credit risk.
Disposition – NBF admitted in a settlement agreement that it failed to fully and properly supervise
the Halifax Representatives and the Montreal Retail Trade Desk and failed on receipt or originationof certain orders to record specific information relating to the orders as required. Participants mustsupervise their employees to ensure that trading in securities on a marketplace is carried out incompliance with the applicable requirements, which include provisions of securities legislation,
UMIR, National Instrument 23-101 - Trading Rules and the Marketplace Rules of any applicable
Exchange. Participants must comply strictly with audit trail requirements. Such compliance is acornerstone of effective compliance and supervision. A complete and proper audit trail is thefoundation on which Participants demonstrate and evidence compliance with regulatory
requirements.
Clarke and O’Reilly admitted in a settlement agreement that they failed to transact business openly
and fairly and in accordance with just and equitable principles of trade as they effected improper
post-execution allocations of trades and granted preferential treatment to certain clients on morethan one occasion by entering orders without identifying the client account and delaying theallocation of the executed trades to client accounts. In addition they admitted to causing
contraventions of UMIR by failing on receipt or origination of certain orders to record specificinformation relating to the orders as required.
Requirements Considered – Rule 2.1, 7.1 10.3(4), 10.4(1), 10.11(1), Policy 2.1, and 7.1
Sanction - NBF agreed to a $250,000 fine and $30,000 in costs, Clarke agreed to a fine of $110,000
and costs of $5,000 and O’Reilly agreed to a fine of $15,000 and $2,500 in costs.
Disciplinary Proceedings:

In the Matter of Kenneth Aitchinson (“Aitchinson”) (June 5, 2020), 2020 IIROC 23
Facts – Between January 2016 and April 2018, the Respondent entered orders on marketplaces ina manner that was not open and fair, nor in accordance with just and equitable principles of trade,
contrary to UMIR 2.1 and Policy 2.1 (before September 1, 2016) and Consolidated Rule 1400
(after September 1, 2016). On 53 occasions, between January 2016 and June 2018, theRespondent deliberately positioned himself at a bid price that he knew was well below the new
implied price of the securities that had undergone a reverse split in an attempt to lead otherparticipants to sell the stock at a price well below its market value.
Disposition and Sanction – Pursuant to a Settlement Agreement, Aitchinson admitted that hecontravened UMIR 2.1 and Policy 2.1 and Consolidated Rule 1400. Aitchinson agreed to a fine of$10,000, costs of $1,000, and to be suspended from approval in any capacity for 30 days.
Requirements Considered – Rule 2.1 and Policy 2.1

Disciplinary Proceedings:

In the Matter of Darren Carrigan (“Carrigan”) and Jason Gold (“Gold”) (December 12, 2019),
2019 IIROC 31
Facts – Between September 2013 and March 2014, (the “Relevant Period”), Carrigan and Goldfacilitated suspicious trading by a group of related clients and insiders of two TSXV-listed issuers,
Company X and Company Y. The trading was carried out through Hampton Securities Ltd.
through three accounts held by the related clients and retail accounts held at another, unrelated
Dealer Member. The Respondents indicate that they were not aware of the existence of theaccounts at the unrelated Dealer Member.
Disposition – Pursuant to a Settlement Agreement, Carrigan and Gold admitted that they failed tofulfill their gatekeeper responsibilities to IIROC-regulated marketplaces, contrary to UMIR Rule2.1(1). Carrigan agreed to a fine of $50,000, costs of $7,500, and to successfully complete theTrader Training Course. Gold agreed to a fine of $20,000, costs of $7,500, and to successfullycomplete the Trader Training Course.
Requirements Considered – Rule 2.1(1).

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UMIR 2.1-9

2.2

Manipulative and Deceptive Activities(1)

A Participant or Access Person shall not, directly or indirectly, engage in or
participate in the use of any manipulative or deceptive method, act or practice inconnection with any order or trade on a marketplace if the Participant or Access
Person knows or ought reasonably to know the nature of the method, act orpractice.

(2)

A Participant or Access Person shall not, directly or indirectly, enter an order or
execute a trade on a marketplace if the Participant or Access Person knows orought reasonably to know that the entry of the order or the execution of the trade
will create or could reasonably be expected to create:

(3)

(a)

a false or misleading appearance of trading activity in or interest in thepurchase or sale of the security, the derivative, the related security or related
derivative; or(b)an artificial ask price, bid price or sale price for the security, the derivative, arelated security or a related derivative.

For greater certainty, the entry of an order or the execution of a trade on amarketplace by a person in accordance with the Marketplace Trading Obligations
shall not be considered a violation of subsection (1) or (2) provided such order ortrade complies with applicable Marketplace Rules or terms of the contract with themarketplace and the order or trade was required to fulfill applicable Marketplace
Trading Obligations.

POLICY 2.2 – MANIPULATIVE AND DECEPTIVE ACTIVITIESPart 1 – Manipulative or Deceptive Method, Act or PracticeThere are a number of activities which, by their very nature, will be considered to be amanipulative or deceptive method, act or practice. For the purpose of subsection (1) of Rule 2.2
and without limiting the generality of that subsection, the following activities when undertaken on
a marketplace constitute a manipulative or deceptive method, act or practice:(a)making a fictitious trade;(b)effecting a trade in a security or a derivative which involves no change in thebeneficial or economic ownership; and(c)effecting trades by a single interest or group with the intent of limiting the supply ofa security or a derivative for settlement of trades made by other persons except at
prices and on terms arbitrarily dictated by such interest or group.

If persons know or ought reasonably to know that they are engaging or participating in these orsimilar types of activities those persons will be in breach of subsection (1) of Rule 2.2

Part 2 – Abusive Trading
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UMIR 2.2-1

irrespective of whether such method, act or practice results in a false or misleading appearanceof trading activity or interest in the purchase or sale of a security or a derivative or an artificial
ask price, bid price or sale price for a security or a derivative or a related security or a related
derivative.

Part 2 – False or Misleading Appearance of Trading Activity or Artificial Price
For the purposes of subsection (2) of Rule 2.2 and without limiting the generality of that
subsection, if any of the following activities are undertaken on a marketplace and create or
could reasonably be expected to create a false or misleading appearance of trading activity orinterest in the purchase or sale of a security or a derivative or an artificial ask price, bid price orsale price, the entry of the order or the execution of the trade shall constitute a violation ofsubsection (2) of Rule 2.2:(a)entering an order or orders for the purchase of a security or derivative with theknowledge that an order or orders of substantially the same size, at substantiallythe same time and at substantially the same price for the sale of that security orthat derivative, has been or will be entered by or for the same or different persons;(b)entering an order or orders for the sale of a security or a derivative with theknowledge that an order or orders of substantially the same size, at substantiallythe same time and at substantially the same price for the purchase of that security
or a derivative, has been or will be entered;(b.1) the prohibition in paragraphs (a) and (b) of Part 2 of Policy 2.2 does not apply tocertain pre-arranged trades as determined by the Corporation from time to time(c) making purchases of, or offers to purchase, a security or a derivative at
successively higher prices or in a pattern generally of successively higher prices;(d)making sales of or offers to sell a security or a derivative at successively lower
prices or in a pattern generally of successively lower prices;(e)entering an order or orders for the purchase or sale of a security or a derivative to:(i)establish a predetermined sale price, ask price or bid price,(ii)

effect a high or low closing sale price, ask price or bid price, or(iii)

maintain the sale price, ask price or bid price within a predetermined range;(f)entering an order or a series of orders for a security or a derivative that are notintended to be executed;(g)entering an order for the purchase of a security or a derivative without, at the timeof entering the order, having the ability or the reasonable expectation to make thepayment that would be required to settle any trade that would result from theexecution of the order;(h)entering an order for the sale of a security or a derivative without, at the time ofentering the order, having the reasonable expectation of settling any trade thatwould result from the execution of the order; and(i)effecting a trade in a security or a derivative, other than an internal cross in a listed
security, between accounts under the direction or control of the same person.

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UMIR 2.2-2

If persons know or ought reasonably to know that they are engaging or participating inthese or similar types of activities those persons will be in breach of subsection (2) ofRule 2.2 irrespective of whether such activity results in a false or misleading appearanceof trading activity or interest in the purchase or sale of a security or a derivative or an
artificial ask price, bid price or sale price for a security or a derivative or a related
security or a related derivative.

Part 3 – Artificial Pricing
For the purposes of subsection (2) of Rule 2.2, an ask price, bid price or sale price will beconsidered artificial if it is not justified by real demand or supply in a security or a derivative.
Whether or not a particular price is "artificial" depends on the particular circumstances.
Some of the relevant considerations in determining whether a price is artificial are:(a)the prices of the preceding trades and succeeding trades;(b)

the change in the:(i) last sale price,(ii) the price that would be used in the determination of the settlement price for alisted derivative,(iii) best ask price,(iv) or best bid pricethat results from the entry of an order on a marketplace;(c) the recent liquidity of the security or derivative;(d)the time the order is entered and any instructions relevant to the time of entry of
the order; and(e)whether any Participant, Access Person or account involved in the order:(i)

has any motivation to establish an artificial price, or(ii)

represents substantially all of the orders entered or executed for thepurchase or sale of the security or derivative.

The absence of any one or more of these considerations is not determinative that a priceis or is not artificial.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “best ask price”, “best bid price”, “consolidated market display”,“derivative”, “internal cross”, “last sale price”, “listed derivative”, “listed security”, “Marketplace Trading
Obligations”, “Market Regulator”, “marketplace”, “Marketplace Rules”, “Participant”, “pre-arranged
trade”, “related derivative” and “related security”
UMIR section 1.2(2) – “person” and “trade”

Related Provisions:

UMIR Policy 1.2 Part 3 – interpretation of “ought reasonably to know”

Regulatory History:

Effective April 1, 2005, the applicable securities commissions approved an amendment to repeal andreplace Rule 2.2 and Policy 2.2. See Market Integrity Notice 2005-011– “Provisions Respecting
Manipulative and Deceptive Activities” (April 1, 2005).
Effective August 26, 2011, the applicable securities commissions approved amendments to subsection
2.2(3). to (a) insert after the phrase “Marketplace Rules” the phrase “or terms of the contract with themarketplace”; and to (b) delete each occurrence of the phrase “Market Maker Obligations” andsubstitute “Marketplace Trading Obligations”. See IIROC Notice 11-0251 – “Provisions RespectingPart 2 – Abusive Trading
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UMIR 2.2-3

Market Maker, Odd Lot and Other Marketplace Trading Obligations” (August 26, 2011).
On March 2, 2012, the applicable securities commissions approved an amendment to repeal clause (d)of Part 1 of Policy 2.2 effective October 15, 2012. See IIROC Notice 12-0078 – “Provisions
Respecting Regulation of Short Sales and Failed Trades” (March 2, 2012).
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French version of
UMIR”.
Effective December 14, 2022, the applicable securities commissions approved amendments to UMIR
2.2(2) and Policy 2.2. See IIROC Notice 22-0140 – “Amendments Respecting the Trading of
Derivatives on a Marketplace” (September 15, 2022).
Effective July 27, 2023, the applicable securities commissions approved housekeeping amendments to
UMIR to correct inaccurate referencing and typographical mistakes and to ensure consistency between
the English and French versions of UMIR. See CIRO Bulletin 23-0107 - "Housekeeping Amendments
to UMIR" (July 27, 2023).
Guidance:

See Market Integrity Notice 2002-010 – “Changes in Beneficial and Economic Ownership” (June26, 2002).

Guidance:

See Market Integrity Notice 2003-002 – “Prohibition on Double Printing” (January 13, 2003).

Guidance:

See Market Integrity Notice 2005-004 – “Double Printing and the Entry of Orders” (March 4, 2005).

Guidance:

See Market Integrity Notice 2005-029 – “Entering Orders on Both Sides of the Market” (September
1, 2005).

Guidance:

See Market Integrity Notice 2006-004 – “Facilitation of a Client Special Settlement Trade andDouble Printing” (February 6, 2006).

Guidance:

See Market Integrity Notice 2006-008 – “Use of the Market-On-Close Facility” (March 10, 2006).

Partially Repealed Guidance: See Market Integrity Notice 2006-020 – “Compliance Requirements for Trading on Multiple
Marketplaces” (October 30, 2006). Questions 5, 7 and 9 in Market Integrity Notice 2006-020
were repealed and replaced by Market Integrity Notice 2008-010 – “Complying with “Best
Price” Obligations” (May 16, 2008). Question 3 in Market Integrity Notice 2006-020 was
repealed and replaced by IIROC Notice 12-0236 –“Guidance on for Trade Confirmations” (July27, 2012). Questions 4, 6, 10 and 11 of MIN 2006-020 were repealed and replaced effective
January 2, 2018 by IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).
Partially Repealed Guidance: See Market Integrity Notice 2007-015– “Specific Questions Related to Trading on Multiple
Marketplaces” (August 10, 2007). Questions 5, 8, 9 and 12 in MIN 2007-015 were repealed andreplaced effective May 16, 2008 by Market Integrity Notice 2008-010 – “Guidance – Complying
with “Best Price” Obligations” (May 16, 2008). Questions 7, 8 and 10 of MIN 2007-015 wererepealed and replaced effective January 2, 2018 by IIROC Notice 17-0138 – “Guidance on Best
Execution” (July 6, 2017).
Partially Repealed Guidance: See IIROC Notice 11-0043 – “Guidance on “Locked” and “Crossed” Markets” (February 1,2011). Questions 2, 5 and 9 of Notice 11-0043 were repealed and replaced effective January 2,
2018 by IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).
Guidance:

See IIROC Notice 13-0053 – “Guidance on Certain Manipulative and Deceptive Trading
Practices” (February 14, 2013)

Guidance:

See IIROC Notice 22-0130 – “Guidance on Participant Obligations to have Reasonable
Expectation to Settle any Trade Resulting from the Entry of a Short Sale Order” (August
17,2022)

Disciplinary Proceedings:

In the Matter of Douglas Christie (“Christie”) (September 5, 2002) OOS 2002-002
Facts – Christie was employed as a Registered Trader (“RT”). One of his stocks of responsibility
was Mosaid Technologies (“Mosaid”). Christie’s compensation was based on trading profits and was
calculated based on the closing month’s inventory balance with all long positions written to theposted bid. On February 28, 2001 and between June 22 to 29, 2001, Christie engaged in a patternof entering buy orders for Mosaid moments before the close of trading which had the effect ofincreasing the bid price. In all cases the bids expired unfilled at the end of the day.
Disposition – During the relevant periods, Christie entered bids in a listed security on behalf of aprincipal or non-client account when the effect of such action was to establish an artificial quotation
or a high closing quotation in the listed security. Christie knew that his firm calculated the value of
his inventory account based on the closing bids on all long positions, and in entering the highclosing bids, he did so for his own financial purposes without the intention of buying or fulfilling his

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UMIR 2.2-4

responsibilities as an RT.
Requirements Considered – TSX Rule 4-202 and Policy 4-202. Comparable UMIR Provision - Rule2.2 and Policy 2.2.
Sanction - $15,000 fine and costs of $6,000.
Disciplinary Proceedings:

In the Matter of Erica Fearn (“Fearn”) (October 28, 2002) OOS 2002-007
Facts – From October 1997 to November 1998, Fearn, an investment advisor, engaged in a patternof non-economic trading in client accounts which had a pre-existing debit positions in their accounts.
Fearn’s practice involved buying, and immediately thereafter selling the same share positions in theclient’s account for the sole purpose of causing the clients’ account debit position to be re-aged,
thereby postponing payment for the debits in the client accounts.
Disposition – Fearn effected or participated in trades when her client did not have the ability of bonafide intention to properly settle the transactions and for the purpose of deferring payment for the
securities traded. As a result of this trading, the normal market price for those securities was unduly
disturbed and created an abnormal market condition.
Requirements Considered – VSE By-law 5.02(4)(a). Comparable UMIR Provision - Rule 2.2 andPolicy 2.2.
Sanction - $7,000 voluntary payment and $3,000 for costs.

Disciplinary Proceedings:

In the Matter of John Andrew Scott (“Scott”) (November 13, 2003) OOS 2003-010
Facts – Between February 1, 2000 and July 5, 2000, Scott and his sales assistant entered orders onbehalf of a group of clients who actively traded a material amount of shares of a particular company.
The trading conducted on behalf of these clients created a false and misleading appearance oftrading activity in the particular stock and in certain instances, created artificial prices for the stock.
Scott also engaged in improper off-marketplace transactions in shares of the stock for his own
personal account.
Disposition – Scott used or knowingly participated in the use of a manipulative or deceptive methodof trading in connection with the purchase and sale of stock which created a false or misleading
appearance of trading activity or an artificial price for the security.
Requirements Considered – Sections 11.01 and 11.26 of the General By-law of the TSX, Part XIV of
the Rulings and Directions of the Board of the TSX, Rule 4-202 and Policy 4-202 of the TSX.
Comparable UMIR Provision - Rule 2.2 and Policy 2.2.
Sanction - $125,000 fine and costs of $35,000; disgorgement of $53,765.85; Suspension from RS
regulated marketplaces for a period of 2 years.

Disciplinary Proceedings:

Rule 2.2 was considered In the Matter of Kai Tolpinrud (“Tolpinrud”) (January 16, 2006) OOS
2004-001. See Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

In the Matter of UBS Securities Canada Inc. (“UBS Canada”) (October 8, 2004) SA 2004-006
Facts – Despite warnings by RS and the release of Market Integrity Notices on the issue of doubleprinting UBS Canada continued to engage in a pattern of double printing from September 2003 toJuly 2004, whereby instead of buying or selling in to the market to fill client orders, UBS bought orsold through its inventory account and subsequently crossed inventory buys and sells to fill client
orders. UBS Canada also failed to develop and implement appropriate policies and procedures, andtest such policies and procedures, in relation to its trading on marketplaces regulated by RS, despite
repeated deficiencies being identified by RS through its Trade Desk Review program.
Disposition – The practice of double printing violated the UMIR prohibition against manipulative anddeceptive methods of trading. In allowing a continued pattern of double printing despite the issuance
by RS of market integrity notices regarding double printing and for its failure to develop andimplement appropriate policies and procedures in relation to its trading on marketplaces regulated
by RS, UBS Canada failed to fulfill its compliance and supervisory obligations.
Requirements Considered – Rules 2.2(1), 10.11(3), 7.1(1) and Policy 7.1.
Sanction - $2,000,000 fine and costs of $100,000; retainer of an independent consultant to review
existing supervisory and compliance systems.

Disciplinary Proceedings:

In the Matter of W. Scott Leckie (July 19, 2005) SA 2005-005
Facts – Between April and June of 2003, the trader employed a short selling strategy on behalf of aclient by trading through Dealer One. When the trader was unable to borrow shares to cover theclient’s short position, he opened an account on behalf of the client at another Participant (“Dealer
Two”) where he believed he could borrow the shares. When he was subsequently unable to borrowthe shares at Dealer Two, he sold short shares in the client’s account at Dealer Two and bought thePart 2 – Abusive Trading
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UMIR 2.2-5

shares in the client’s account at Dealer One to cover the outstanding short position. During therelevant period the trader engaged in a practice of entering into, and covering short positions, bytrading between the two client accounts at Dealers One and Two.
Disposition – Effecting trades in securities which involved no change in beneficial or economic
ownership was “wash trading” and constituted a manipulative and deceptive method of trading.
Requirements Considered – Rules 2.2(2)(b) and 10.4(1)(a).
Sanction - $100,000 fine and costs of $20,000.
Disciplinary Proceedings:

In the Matter of Ian Macdonald, Edward Boyd, Peter Dennis and David Singh (July 28, 2005)
SA 2005-006
Facts – In August of 2004, RBC DS and another Participant agreed to execute trades in two
securities in the Market-on-Close facility (”MOC”) of the TSX by the entry of market orders on
opposite sides of the market. RBC DS entered its required orders for RBC DS inventory accounts.
The other Participant subsequently failed to enter the agreed counterparty orders. This resulted in a
MOC imbalance, which was broadcast at 3:40 pm. RBC DS then entered offsetting limit MOC orders
for RBC DS inventory accounts to limit its potential liability created by the MOC imbalance.
Disposition - Entry by employees of a Participant of limit MOC orders to off-set market MOC orders
entered by those employees for that Participant, even in circumstances where the employees aretrying to “correct” an existing MOC imbalance, were “wash trades” and constituted a manipulativeand deceptive method of trading.
Requirements Considered – Rules 2.2(1), 2.2(2)(b) and 10.4(1)(a).
Sanction –Disciplinary Proceedings:

Ian Macdonald$90,000 fine and costs of $35,000

Edward Boyd

$60,000 fine and costs of $20,000

David Singh$60,000 fine and costs of $20,000

Peter Dennis$20,000 fine and costs of $7,000.

In the Matter of Alfred Simon Gregorian (“Gregorian”) (April 12, 2006) DN 2006-003
Facts – Between September 1, 2002 and May 31, 2003, and between November 1, 2003 andJanuary 12, 2004, Gregorian, an investment advisor at Research Capital Corporation, participated in
his clients’ use of manipulative methods of trading in connection with the purchase and sale ofsecurities in International Wex Technologies Inc (“WXI”), a TSXV listed issuer. Between September
1, 2002 and May 31, 2003, Gregorian placed 801 orders for shares of WXI for the accounts of two
clients from orders provided by insiders of WXI who held trading authorizations over the clients’accounts. The pattern of order entry and trading involved placing bids in the market when the shareprice of WXI was under pressure and executing uptick purchases to “correct” intra-day downticks inthe price of WXI in an effort to improperly support the price of the WXI shares.
Between November 1, 2003 and January 12, 2004, Gregorian participated in his client’s use ofmanipulative methods of trading in connection with the purchase of shares of WXI by engaging in apattern of trading which was not consistent with a bona fide effort to accumulate shares of WXI overtime at the most favourable prices and represented an overall pattern of trading at prices higher thanwould otherwise been dictated by market forces.
Disposition – The nature and extent of the trading in the clients’ accounts coupled with theextraordinary commission charges and frequency of uneconomic trading evidences Gregorian’s
knowing participation in the manipulative and deceptive methods of trading that occurred in theclients’ accounts.
Requirements Considered – Rule 2.2.
Sanction - $39,000 fine and disgorgement of $16,260 of financial benefit to Gregorian; suspension
from RS regulated marketplaces for 5 years.

Disciplinary Proceedings:

In the Matter of Michael Bond (“Bond”) and Sesto DeLuca (“DeLuca”) (June 4, 2007) DN
2007-003
Facts – Between April 4, 2005 and July 29, 2005, Bond, an inventory trader employed by W.D.
Latimer Co. Limited, created an artificial bid price for the shares of three thinly traded TSX Venture
Exchange listed issuers (the “Securities”) when he entered several buy orders late in the trading
session for the Stocks that were unlikely to be filled.
Between April 2005 and July 2005, DeLuca was the person responsible for supervising trading at
W.D. Latimer, which including supervising Bond. DeLuca failed to review unfilled orders placed by
Bond, thereby allowing Bond to create an artificial bid price for the Securities.

Part 2 – Abusive Trading
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UMIR 2.2-6

Disposition – By entering orders to buy the Securities when he knew or ought reasonably to have
known that the entry of such orders could create or could reasonably be expected to create an
artificial bid price for the Securities Bond breached UMIR 2.2(2)(b). Deluca, by failing to review
unfilled orders placed by Bond breached Rule 7.1(4) Policy 7.1 of UMIR.
Requirements Considered – Rules 2.2(2)(b), 7.1(4) and Policy 7.1.
Sanction –Bond – $100,000 fine, costs of $25,000 and suspension from access to allmarketplaces regulated by RS for a period of two years
DeLuca – reprimanded for his conduct.

Disciplinary Proceedings: In the Matter of Luc St. Pierre (“St. Pierre”) (December 31, 2007) DN 2007-006
Facts – Between February 2, 2005 and May 19, 2005, St. Pierre, acting on behalf of a client entered
31 orders to purchase shares of Halo Resources Ltd. (“HLO”), an issuer whose shares trade on the
TSX Venture Exchange (“TSXV”). All of the orders entered by St. Pierre (which were generally for
one or two board lots) were executed at a price which was higher than the preceding independenttransaction for shares of HLO, and in case of 16 orders, their execution was the last trade of the day
for HLO shares.
Further, St. Pierre administered accounts for three clients who were either associated with eachother or associated with Golden Hope Mines Ltd. (“GNH”), an issuer whose shares are traded on
the TSXV. Through St. Pierre, these three clients executed trades representing 56% of the total
trading volume in GNH on the TSXV, of which forty-five trades, or 46% of the total trading volume in
GNH, were between the three clients and were submitted to St. Pierre within seconds of each other.
In addition to the majority of such trades not being properly marked as “crosses”, sale orders
entered by the three clients were systematically entered prior to purchase orders in order to facilitate
the transfer of debit and credit positions between the clients’ accounts.
Disposition – By entering orders on a marketplace when he knew or ought to have known that theentry of such orders could create an artificial price for the securities, St Pierre breached Rule 2.2
and Policy 2.2 of UMIR
Requirements Considered – Rule 2.2 and Policy 2.2.
Sanction – A Hearing Panel imposed a fine of $40,000, costs in the amount of $70,000, suspensionof access to all marketplaces regulated by IIROC for a period of 5 years, successful completion of
the Conduct and Practices Handbook examination before the Respondent may be employed with a
Participant, and heightened supervision for the length of the 5 year suspension if employed with a
Participant.
Disciplinary Proceedings:

In the Matter of Kevin Moorhead (“Moorhead”) (May 22, 2008) DN 2008-001
Facts – Between August 29, 2005 and October 27, 2005, Moorhead and/or his assistant, on
Moorhead’s instructions, entered orders on a marketplace for certain securities with the intention of
establishing an artificial and/or a high closing bid price in order to improve the daily profit and loss
position of shares held in Moorhead’s inventory account and/or to assist a trader at another firm toincrease the daily profit or reduce the daily loss in his inventory account.
Disposition – By entering orders on a marketplace that were not justified by any real demand for the
securities Moorhead knew that his order entry activity would create, or could reasonably be
expected to create, an artificial price for the securities contrary to Rule 2.2 and Policy 2.2 of UMIR.
Requirements Considered – Rule 2.2(1), 2.2(2)(b) and Policy 2.2.
Sanction – $40,000 fine and costs of $10,000 and suspension from all RS regulated marketplaces
for three months.

Disciplinary Proceedings:

In the Matter of Martin Fabi (“Fabi”) (October 27, 2008) DN 08-0159
Facts – On December 31, 2007 Fabi, a Registered Representative with MF Global Canada Co.,
acting on instructions from a client, executed trades on the TSX Venture Exchange for 6 listed
equities at or near the end of the trading day resulting in the “up-ticking” of the closing price of the
securities. The client, a fund manager, managed a portfolio of securities that included the 6
securities, and which represented approximately 68% of the market value of the fund’s portfolio.
Disposition – The purpose of Rule 2.2 and Policy 2.2 is to protect the marketplace from manipulativeand deceptive trading activity and artificial pricing. Given the timing and circumstances surrounding
the entry of the orders at or near the end of the trading day, and based on conversations Fabi hadwith the fund manager prior to the entry of the orders, Fabi ought to have known that the fundmanager had a motivation to effect a high closing sale price for the securities. By entering orders
and executing trades on a marketplace that Fabi ought to have known would create an artificial pricefor the securities Fabi failed to fulfill his gatekeeper obligation and acted contrary to Rule 2.2 andPart 2 – Abusive Trading
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UMIR 2.2-7

Policy 2.2.
Requirements Considered – Rules 2.2(2)(b) and 10.4(1) and Policy 2.2.
Sanction – $15,000 fine and costs of $5,000.
Disciplinary Proceedings:

In the Matter of Luc St. Pierre (“St Pierre”) (November 18, 2008) DN 08-0195
Sanction – $30,000 fine and costs of $70,000; suspension of access to all IIROC regulated
marketplaces for 5 years; successful completion of the Conduct and Practices Handbook
examination; and heightened supervision for a period of 5 years if employed by a Participant.

Disciplinary Proceedings:
Disciplinary Proceedings:

Rule 2.2 was considered In the Matter of Tony D’Ugo (“D’Ugo”) (April 6, 2010) DN 10-0093. See
Disciplinary Proceedings under Rule 2.1.
In the Matter of Francesco Mauro (“Mauro”) and Scott Fraser Harding (“Harding”) (May 25,2010) DN 10-0149
Facts – Between December 14, 2006 and January 24, 2007 (the “Relevant Period”), Mauro was
employed with CIBC World Markets Inc. (“CIBC”) as a registered representative, branch manager,
and officer (trading securities) and Harding worked as an associate investment advisor with Mauroand entered most orders for Mauro’s clients. During the Relevant Period, Harding enteredunsolicited orders and executed trades on behalf of a client in the shares of a listed company on the
TSX Venture Exchange that was the subject of a private placement at $1.00 per unit, facilitated by
CIBC. Harding entered 46 buy orders in the client’s account when the price of the security fell below$1.00 and traded below $1.00 for 20 trading days, of which 24 were active orders that traded at or
above the posted offer price upon entry, 14 were entered in the last hour of trading and restored theshare price of the security to close at or near $1.00 after a price decline, 13 established the closing
price of the shares, 12 established the closing price at $1.00, 6 had a limit price of $1.00 and tradedentirely at the posted offer price of $1.00; and 7 had a limit price of $1.00 and traded entirely at
successive prices up to $1.00. Mauro had a duty to supervise Harding’s execution of trades. In
conducting his reviews, while his computer terminal permitted him to review up-to-the-minute tradingin his branch, including trade times, Mauro did not actively monitor this.
Disposition – Under the terms of a Settlement Agreement, Harding admitted that between
December 14, 2006 and January 24, 2007 he failed in his role as a gatekeeper. He entered orders
and executed trades on behalf of a client for a listed company on the TSX Venture Exchange that heought to have known could reasonably be expected to create an artificial price for the security
contrary to UMIR 2.2(2)(b) and UMIR Policy 2.2 (e), for which he is liable under UMIR 10.4(1).
Mauro admitted under the terms of the Settlement Agreement, that during the Relevant Period he
did not meet the standard required of him in his role as a supervisor by failing to fully and properly
supervise Harding as necessary, to ensure that he complied with UMIR and its Policies, contrary to
UMIR 7.1 (4) and Policy 7.1.
Requirements Considered – Rules 2.1, 2.2(2)(b), 10.4(1), 10.16(1)(b), 7.1(4) and Policy 2.2(e) and
7.1.
Sanctions – Harding agreed to a $40,000 fine and $10,000 in costs. Mauro agreed to $25,000 fineand $5,000 in costs.

Disciplinary Proceedings:

In the Matter of James Martin MacMenamin (“MacMenamin”) (June 3, 2010) DN 10-0162
Facts – MacMenamin, while a trader employed by Jones, Gable & Company Limited, was paid 50%of any profits (realized and unrealized) that he generated in a proprietary inventory account that heoperated. On a monthly basis, for compensation purposes, the long positions in the proprietary
inventory account were valued at their closing bid price. For the month of April 2008, the valuation
day for the proprietary inventory account was April 25, 2008, on which date MacMenamin placed a
day buy order late in the day for shares of a security trading on the TSX Venture Exchange at a limit
price $0.07 greater than the previous trade, and $0.07 higher than the prevailing best bid price. The
day buy order became the closing bid price for April 25, 2008, creating an unrealized profit in the
proprietary inventory account, which otherwise would have incurred an unrealized loss.
MacMenamin further entered orders on behalf of the proprietary inventory account between
November 19 and December 9, 2008, that he did not intend to execute in order to entice analgorithmic trading program to join or displace him from the best displayed bid or offer price for theshares of certain securities. When the algorithm joined or displaced his order, MacMenamincancelled his order and then bought or sold from the algorithm order that had joined or displaced hisorder. This activity enabled MacMenamin to purchase shares at a lower cost and to sell shares at ahigher price.
Disposition – Under the terms of a Settlement Agreement, MacMenamin admitted that on April 25,
2008, he entered an order on behalf of a proprietary inventory account that he knew or ought toPart 2 – Abusive Trading
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UMIR 2.2-8

have known would create or could reasonably be expected to create an artificial closing bid price forthe shares, contrary to UMIR 2.2(2)(b) and UMIR Policy 2.2, for which he is liable under UMIR
10.4(1); and that between November 19 and December 9, 2008, he entered orders on behalf of a
proprietary inventory account that he knew or ought to have known he did not intend to execute,contrary to UMIR 2.2(2)(a) and UMIR Policy 2.2, for which he is liable under UMIR 10.4(1).
Requirements Considered – Rules 2.1, 2.2(2)(a),(b), 10.4(1) and Policy 2.2.
Sanctions – MacMenamin agreed to a $25,000 fine and $5,000 in costs.
Disciplinary Proceedings:

In the Matter of TD Securities Inc. (“TDSI”), Kenneth Nott (“Nott”), Aidin Sadeghi (“Sadeghi”),
Christopher Kaplan (“Kaplan”), Robert Nemy (“Nemy”) and Jake Poulstrup (“Poulstrup”)(collectively, the “Individual Respondents”) (December 20, 2010) DN 10-0338
Facts – The Individual Respondents were all TSX Registered Traders hired by TDSI to work as
Inventory Traders (also called Proprietary Traders). Between May 1 to October 31, 2005 (the“Relevant Period”), each of the Individual Respondents entered high closing bids on either NEX,
TSX-V or TSX to purchase one or more of five illiquid stocks (collectively, the “Five Stocks”). The
collective trading pattern of the Individual Respondents revealed that orders in the illiquid stocks
were placed very late in the day in small lots that set the closing bids day after day, week after
week, and month after month. TDSI had at its disposal a number of display “tools” that could beselected to assist in monitoring and supervising the traders, however, there was no tool available in
the Relevant Period to monitor real time orders (i.e. bids and offers). TDSI was only provided with
reports (e.g. high month end closings) that did not include any information regarding bids and offers.
Consequently, TDSI did not have a systematic procedure to review orders.
Disposition – An artificial bid price results when there is an intention to establish a price that is notjustified by real demand or supply in a security. In the Relevant Period, the Individual Respondents
made closing bids in the context of the market with the intention that the bids would not trade but
instead would stand as the closing bid at the end of the trading day thereby increasing the value of
their inventory positions (which were calculated on the basis of the closing bids) and increasing theircompensation and access to capital. The circumstantial evidence of motive and trading patterns (thefrequency of setting the closing bids, late time of the closing bid orders, bidding in small lots and theilliquid nature of the stocks), supported an inference on a balance of probabilities that the Individual
Respondents intended to engage in the improper practice of entering artificial closing bids in theFive Stocks. This finding was buttressed by direct evidence of instant messages and telephone calls
between the Individual Respondents which showed concern for monthly ranking, the value of theadjusted cost base in a month other than a pay period month end and a willingness to manipulate
the market for personal reasons. In the Relevant Period, Nott entered 230 artificial closing bids;
Sadeghi entered 3 artificial closing bids; Kaplan entered 37 artificial closing bids; Nemy entered 38
artificial closing bids; and Poulstrup entered 14 artificial closing bids, all of which were incontravention of UMIR 2.2(2)(b) and UMIR Policy 2.2.
There was no proof, however, that TDSI failed to comply with its UMIR Rule 7.1 and UMIR Policy
7.1 trading supervision obligations and this allegation was dismissed. TDSI did not have a real time
software surveillance system during the Relevant Period to detect the time and sequence of bids
and offers in the marketplace. Demonstrating a pattern of late bids by a trader was one the factors
relied on in drawing an inference of artificial closing bids, however the time required to do so wasbeyond the capacity of TDSI as the end of the day trading of a stock would have to be printed fromthe Firm Book every day for sufficient days to reveal a pattern of late bids. In the circumstances, therandom review approach employed by TDSI was reasonable and realistic. Moreover, TDSI
deserved credit for the manner in which it monitored and detected bidding improprieties in one of theFive Stocks and for the prompt filing of a Gatekeeper Report after the discovery of a wash trade
between Nott and Sadeghi. While there was a fundamental flaw in the TDSI compliance monitoring
system employed following the Relevant Period to evaluate whether there had been improper
trading, as it had not been configured to generate alerts for late bids that were below the last saleand thus made within the “context of the market”, (as was the case with the Individual
Respondents), this was due to an honest but erroneous interpretation of UMIR Policy. The correctinterpretation is that the process of bidding within the context of the market in order to maintain thevalue of a stock contravenes UMIR and bidding must be in accordance with true market supply anddemand.
Requirements Considered – Rule 2.2(2)(b), 7.1 and Policy 2.2, 7.1.
Sanction – The Hearing Panel determined in the case of all the Individual Respondents that there
be no order of suspension as they had not obtained employment at all, or for a significant period oftime, since September, 2008, and that except for Sadeghi, they be under close supervision for six
months, the terms of which would be determined by an employer. Additional penalties and orders

Part 2 – Abusive Trading
July 27, 2023

UMIR 2.2-9

were imposed as follows:•

Nott: (a) a fine of $15,000.00; and (b) costs of $5,000.00.

•

Sadeghi: (a) a fine of $5,000.00. The Hearing Panel noted that there would be no orderfor supervision and strongly recommended that the close supervision order in effect be
rescinded.

•

Kaplan: (a) a fine of $35,000.00; and (b) costs of $15,000.00. In addition, the Hearing
Panel ordered that the trade restrictions in effect cease to apply to Kaplan immediately.

•

Nemy: (a) a fine of $75,000.00; and (b) costs of $37,500.00.

•

Poulstrup: (a) a fine of $20,000.00; and (b) costs of $10,000.00. In addition, the Hearing
Panel ordered that trade restrictions in effect cease to apply to Poulstrup immediately.

Review – IIROC staff has filed a Notice of Request for Hearing and Review to the Ontario Securities
Commission for a review of the decision of the IIROC Hearing Panel, dated November 30, 2010,
relating to TDSI.
Disposition – The Review application was dismissed by the OSC on July 19, 2013 as there was noerror of law or principle in the IIROC Hearing Panel’s decision. The OSC concluded that the IIROC
Hearing Panel’s statement regarding the erroneous understanding of UMIR was not central to its
finding with respect to TDSI’s supervision of the TDSI traders and noted that the decision makes
clear the obligation of Participants to supervise both trades and orders, including orders that are in
the context of the market, so as to comply with their obligations under UMIR Rule 7.1 and Policy 7.1.
Disciplinary Proceedings:

In the Matter of Gary John Williamson (“Williamson”) (February 28, 2011) DN 11-0085
Facts – Between January 1, 2008 and February 29, 2008, Williamson, a trader employed by Global
Maxfin Capital Inc. (“Global Maxfin”), entered numerous bid orders on the TSX Venture Exchange(“TSXV”) for an illiquid security very late in the trading day. All the orders were entered as dayorders, none of the orders were filled and all increased the closing bid price. Given the illiquidity ofthe security and the short length of time the orders were open, Williamson’s bid orders had virtuallyno prospect of being filled. Global Maxfin earned revenue through proprietary trading. Williamson
was assigned an individual inventory account and was the only person who entered orders in his
inventory account. Williamson’s inventory account was valued daily for all the long positions at theclosing bid and all short positions at the closing offer. Williamson was aware of his profit and loss
position and was compensated based on commissions earned as well as profits and losses within
his inventory account. Prior to the impugned trading activity, Williamson was indebted to Global
Maxfin in excess of $32,000 as a result of a foreign exchange error and trading losses in his
inventory account. Williamson’s monthly compensation was partially reduced to pay down his
indebtedness to Global.
Disposition – Pursuant to a Settlement Agreement, Williamson admitted that between January 1,
2008 and February 29, 2008, he entered orders on the TSXV that he knew or ought reasonably tohave known would create or could reasonably be expected to create an artificial bid price contrary to
UMIR 2.2(2)(b) and UMIR Policy 2.2 for which he is liable under UMIR 10.4(1). Williamson enteredorders to purchase securities of an issuer without any intention that the orders would be executedand for no bona fide purpose. Williamson entered the orders with the intention of establishing a highclosing bid price in order to improve the unrealized daily profit and loss position of the shares held in
his inventory account and thereby to misrepresent the performance of the security. The high closing
bid prices were artificial in that they were not justified by any real demand for the securities, andmisrepresented the performance and actual demand for the securities to the market and to othermarket participants. The impugned transactions served to overstate the unrealized profits orunderstate the unrealized losses for the security in his inventory account.
Requirements Considered – Rule 2.2(2)(b),10.4(1) and Policy 2.2
Sanction – Williamson agreed to pay a fine of $40,000; to a suspension of access to an IIROCregulated marketplace for a period of 6 months; and to pay costs in the amount of $5,000.

Disciplinary Proceedings:

In the Matter of Donald Dean MacKenzie (“MacKenzie”) (May 12, 2011) DN 11-0152
Facts – Between September 2007 and June 2008, MacKenzie, a registered representative with
RBC Dominion Securities Inc. (“RBCDS”), entered numerous late bid orders for an illiquid security
on the Toronto Stock Exchange (“TSX”), in various non-arm’s length accounts at RBCDS.
Mackenzie entered the orders with the intention of establishing a high closing bid price to narrow the
spread between the closing bid and ask prices because he felt the assigned market maker was notdischarging his Market Maker Obligations and maintaining a fair and orderly market for the security.
Upon detecting the pattern of late bid orders, RBCDS internally disciplined the Mackenzie.
Disposition – Pursuant to a Settlement Agreement, MacKenzie admitted that between September,Part 2 – Abusive Trading
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UMIR 2.2-10

2007 and June 2008, he entered orders on the TSX that he knew or ought reasonably to have
known would create or could reasonably be expected to create an artificial bid price contrary to
UMIR 2.2(2)(b) and UMIR Policy 2.2 for which he is liable under UMIR 10.4(1). The closing bid
orders had no bona fide purpose and were entered to establish a high closing bid price in order tonarrow the spread between the bid price and the ask price. In so doing, MacKenzie misrepresented
the performance and actual demand for the security to the market and to other market participants.
Requirements Considered – Rule 2.2(2)(b),10.4(1) and Policy 2.2.
Sanction – MacKenzie agreed to pay a fine of $20,000; to a prohibition on seeking re-registration
approval with any Dealer Member of IIROC for a period of 3 months; and to pay costs in the amountof $5,000.
Disciplinary Proceedings:

In the Matter of David Charles Parkinson (“Parkinson”) (February 22, 2012) DN 12-0061
Facts – Between November and December 2007, and in March, 2008, (the “Relevant Period”)
Parkinson, a Registered Representative employed by CIBC World Markets Inc. (“CIBC WM”),
entered orders and executed trades on the TSX Venture Exchange (“TSXV”) for two securities onbehalf of a client, that maintained and supported the price of the securities at a level predetermined
by Parkinson’s client. In particular, Parkinson entered closing trades and closing bids in the
securities for the client’s accounts causing end of day upticks in the sale price and bid price. Margin
was granted on the securities at Parkinson’s request on behalf of the client, which was calculated by
CIBC WM using a stock’s closing bid price. Parkinson’s client entered a settlement agreement with
the Ontario Securities Commission admitting that between June 2007 and April 2008 he engaged in
trading that had the effect of maintaining and/or increasing the closing price of one of the securities
which was traded in the CIBC WM account.
Disposition – Pursuant to a Settlement Agreement, Parkinson admitted that in the Relevant Period
he entered orders and trades on behalf of a client that he ought reasonably have known would
create or could reasonably be expected to create an artificial price for two TSXV securities, contrary
to UMIR 2.2(2)(b) and UMIR Policy 2.2 for which he is liable under UMIR 10.4(1). Parkinson had agatekeeper obligation to be aware of and alert to potential or known manipulative and deceptive
activity.
Requirements Considered – Rule 2.2(2)(b),10.4(1) and Policy 2.2.
Sanction – Parkinson agreed to pay a fine of $30,000; to a suspension of access to an IIROCregulated marketplace for a period of 6 months from termination of his employment; and to pay
costs in the amount of $10,000.

Disciplinary Proceedings:

In the Matter of William Geddes (“Geddes”) (March 15, 2012) DN 12-0098
Facts – Between December 2007 and October, 2008, (the “Relevant Period”) Geddes, a Registered
Representative with National Bank Financial Ltd. (“NBF”) entered buy orders for a security listed on
the Toronto Stock Exchange (TSX) in his and his wife’s accounts (the “Geddes Accounts”), toincrease the closing price of the security as its share price was generally in decline. Geddes’ client
accounts also held positions in the same security. The orders Geddes placed were uneconomic dueto the high commission costs which they generated. Geddes sold few of the shares in the Geddes
Accounts, however, and did not profit from the increase in the value of his clients’ monthly accountstatements caused by the entry of the buy orders for the security.
Disposition – Pursuant to a Settlement Agreement, Geddes admitted that in the Relevant Period heentered buy orders he ought reasonably to have known would create or could reasonably be
expected to create an artificial sale price for the security, contrary to UMIR 2.2(2) and UMIR Policy
2.2, for which he is liable under UMIR 10.4.
Requirements Considered – Rule 2.2(2), 10.4 and Policy 2.2.
Sanction – Geddes agreed to pay a fine of $30,000, a 60 day suspension from registration,
successful completion of the Conduct and Practices Handbook Course and to pay costs in theamount of $1,500.

Disciplinary Proceedings:

In the Matter of Vinh-Phat Nguyen-Qui (“Nguyen-Qui”) (October 11, 2012) DN 12-0298
Facts – Between October and December 2009 (the “Relevant Period”), Nguyen-Qui, a Registered
Representative employed by W.D. Latimer Co. Limited, entered buy and sell orders on the TSX in
the pre-opening market and cancelled them prior to market opening for the sole objective of
acquiring a better chronological position once the market opened. Nguyen-Qui also entered shortsale orders in the pre-opening market without designating them as short sales and/or at a pricebelow the last sale price as indicated in the consolidated market display.
Disposition – In the Relevant Period, Nguyen-Qui entered orders he knew or ought to reasonably
have known would create or could reasonably be expected to create, a false or misleading

Part 2 – Abusive Trading
July 27, 2023

UMIR 2.2-11

appearance of trading activity or interest in the purchase or sale of the security, contrary to UMIR
2.2(2)(a); entered short sale orders in the pre-opening market without proper designation contrary to
UMIR 6.2(1)(b)(viii); and entered short sale orders in the pre-opening market below the last saleprice, contrary to UMIR 3.1(1).
Requirements Considered – Rule 2.2(2)(a), 3.1(1) and 6.2(1)(b)(viii).
Sanction – The Hearing Panel imposed a prohibition on Nguyen-Qui from accessing the market as a
Registered Representative for a period of two months and a fine of $10,000 for the first violation
plus fines of $5,000 for each of the two additional violations; Nguyen-Qui was also required to takethe Trader Training Course again and pay costs in the amount of $10,000.
Disciplinary Proceedings:

In the Matter of James William Watson (“Watson”) (October 29, 2012) DN 12-0319
Facts – Between November 2010 and April 2011 (the “Relevant Period”), Watson, a trader
employed by Jones Gable & Company Limited, entered orders for a security listed on the TSXV toeffect a high closing bid price that misrepresented the performance and actual demand for the
security and artificially increased the value of the position in the security held in Watson’s inventory
account.
Disposition – Pursuant to a Settlement Agreement Watson admitted that in the Relevant Period, heentered orders on the TSXV that he knew or ought to reasonably have known would create or could
reasonably be expected to create, a false or misleading appearance of trading activity or interest in
the purchase or sale of the security or an artificial bid price for the security, contrary to UMIR 2.2(2)and Policy 2.2.
Requirements Considered – Rule 2.2(2) and Policy 2.2.
Sanction – Watson agreed to pay a $10,000 fine, to a suspension of access to IIROC-regulated
marketplaces for a period of 14 days, as well as to pay costs in the amount of $1,500.

Disciplinary Proceedings: Rule 2.2 and Policy 2.2 were considered In the Matter of Alexey Eydelman (“Eydelman”) andQuestrade Inc. (“Questrade”) (May 24 2013) DN 13-0140. See Disciplinary Proceeding under Rule
7.1.
Disciplinary Proceedings:

In the Matter of Jean-François Lemay (“Lemay”) (June 5 2013) DN 13-0150
Facts – Between September and October 2008 (the “Relevant Period”), Lemay, a registeredrepresentative at Union Securities Ltd, entered buy and sell orders on the TSXV when he knew that
identical buy and sell orders were being entered simultaneously, with no change of beneficial
ownership, creating fictitious buy and sell transactions involving the same securities.
Disposition – In the Relevant Period, Lemay entered orders or executed transactions when he knew,
or ought reasonably to have known, that the entry of such orders or the execution of thetransactions would create, or could reasonably be expected to create, a false or misleading
appearance of trading activity with respect to the security, contrary to UMIR 2.2(2)(a) and Policy 2.2.
Requirements Considered – Rule 2.2(2)(a) and Policy 2.2.
Sanction – The Hearing Panel imposed a suspension from access to the marketplaces for a periodof six months and a fine of $35,000 on Lemay. Lemay was also subject to strict supervision by his
employer for a period of 12 months should he return to employment with an IIROC-regulated firm,
and to successfully complete the Conduct and Practices Handbook Course. Lemay was also
required to pay costs in the amount of $25,000.

Disciplinary Proceedings:

In the Matter of Yufeng Zhang (“Zhang”) (June 7 2013) DN 13-0155
Facts – Between July and December 2010 (the “Relevant Period”), Zhang, a proprietary trader
employed by Wolverton Securities Ltd, entered orders in the pre-opening session in several TSXVlisted securities in order to identify the depth of the market and more particularly to detect the size of
iceberg orders entered on the opposite side of the market.
Disposition – Pursuant to a Settlement Agreement Zhang admitted that in the Relevant Period, heengaged in a manipulative or deceptive practice in the pre-opening on a marketplace contrary to
UMIR 2.2(1) and Policy 2.2.
Requirements Considered – Rule 2.2(1) and Policy 2.2.
Sanction – Zhang agreed to pay a $10,000 fine, to a suspension of access to IIROC-regulated
marketplaces for 1 month, and to pay costs in the amount of $1,500.

Disciplinary Proceedings:

Rule 2.2 and Policy 2.2 were considered In the Matter of JitneyTrade Inc. (“JitneyTrade”) (July23, 2013) DN 13-0196. See Disciplinary Proceedings under Rule 7.1.

Disciplinary Proceedings:

In the Matter of Zhenyu Li (“Li”) (July 27, 2015) DN 15-0164
Facts – Between August 2012 and November 2012 (the “Relevant Period”), Li, while employed as aPart 2 – Abusive Trading
July 27, 2023

UMIR 2.2-12

proprietary trader at National Bank Financial Inc., entered non-bona fide orders in the pre-opening
on the TSX and TSXV that he ought to have known would affect the Calculated Opening Price (the“COP”) of the securities to his own advantage. Li’s pattern of order entry, a practice commonly
known as “spoofing”, misrepresented the supply, demand, or price for the securities.
Disposition – Pursuant to a Settlement Agreement Li admitted that in the Relevant Period, heentered orders that he ought reasonably to have known would create, or could reasonably be
expected to create, a false or misleading appearance of trading activity in or interest in the purchaseor sale of the securities or an artificial sale price for the securities, contrary to UMIR 2.2(2) and
Policy 2.2.
Requirements Considered – Rule 2.2(2) and Policy 2.2.
Sanction – Li agreed to pay a $10,000 fine, to a suspension of access to IIROC-regulated
marketplaces for 1 month, and to pay costs in the amount of $1,500.
Disciplinary Proceedings:

In the Matter of Robert Sole (“Sole”) (September 1, 2016) DN 16-0203
Facts – Between March 2013 and June 2013, and between October 2014 and December 2014,
while a proprietary trader at W.D. Latimer Co. Ltd., Sole entered orders that he ought reasonably tohave known, would create or could reasonably be expected to create, a false or misleading
appearance of trading activity in or interest in the purchase or sale of securities or an artificial pricefor securities, contrary to UMIR 2.2(2) and UMIR Policy 2.2.
Disposition – Pursuant to a Settlement Agreement, Sole admitted that he entered orders that heought reasonably to have known would create, or could reasonably be expected to create, a false or
misleading appearance of trading activity in or interest in, the purchase or sale of securities or an
artificial price for securities.
Requirements Considered – Rule 2.2(2) and Policy 2.2.
Sanction – Sole agreed to pay a $10,000 fine, to a suspension of access to IIROC-regulated
marketplaces for 1 month, and to pay costs in the amount of $1,000.

Disciplinary Proceedings:

In the Matter of Teymur Englesby (“Englesby”) and Cale Nishimura (“Nishimura”) (October 3,2016) DN 16-0225
Facts – While employed as Registered Representatives at PI Financial Corp., Englesby andNishimura entered orders and executed trades on multiple marketplaces for the shares of DVN inthe period September 18, 2012 to January 23, 2013 that they ought reasonably to have known,
could reasonably be expected to create an artificial price for the securities, contrary to UMIR
2.2(2)(b) and UMIR Policy 2.2).
Disposition – Pursuant to a Settlement Agreement, Englesby and Nishimura admitted to the entry oforders that they ought reasonably to have known, could reasonably be expected to create an
artificial price for the securities.
Requirements Considered – Rule 2.2(2) and Policy 2.2.
Sanction – Englesby agreed to pay a $45,000 fine, to a suspension of access to IIROC-regulated
marketplaces for 2 months, and to pay costs in the amount of $5,000; Nishimura agreed to pay a$15,000 fine, to a suspension of access to IIROC-regulated marketplaces for 1 month, and to pay
costs in the amount of $5,000.

Disciplinary Proceedings:

Rule 2.2 and Policy 2.2 were considered In the Matter of JitneyTrade (“JitneyTrade”) (April 10,2017) DN 17-0082. See Disciplinary Proceedings under Rule 7.1.

Disciplinary Proceedings:

In the Matter of Russell Waddington (“Waddington”) (July 27, 2017) DN 17-0161
Facts – Between October 2014 and December 2014, Waddington entered orders that he intended
to execute (bona fide orders) on one side of the market. He simultaneously placed orders that hedid not intend to execute (non-bona fide orders) on the other side of the market in order to induce
other market participants to react and trade with one of his bona fide orders at an artificial price.
Disposition – Pursuant to a Settlement Agreement, Waddington admitted that he entered orders that
he ought reasonably to have known would create, or could reasonably be expected to create, afalse or misleading appearance of trading activity in or interest in the purchase or sale of securities
or an artificial price for securities, contrary to UMIR 2.2(2).
Requirements Considered – Rule 2.2(2).
Sanction – Waddington agreed to pay a fine of $10,000, to a suspension of access to IIROCregulated marketplaces for 1 month, and to pay costs in the amount of $1,000.

Disciplinary Proceedings:

In the Matter of Aidin Sadeghi (“Sadeghi) (August 23, 2018) DN 18-0167
Facts – Between December 2012 and January 2013, Sadeghi, while employed as a proprietary
trader at W.D. Latimer Co. Ltd., entered orders that he knew, or ought reasonably to have known,
would create, or could reasonably be expected to create, a false or misleading appearance oftrading activity in or interest in the purchase or sale of the securities, contrary to UMIR 2.2(2) andPart 2 – Abusive Trading
July 27, 2023

UMIR 2.2-13

UMIR Policy 2.2,
Disposition – An IIROC hearing panel found that Sadeghi entered orders in the pre-opening session
on the TSX that he did not intend to execute.
Requirements Considered – Rule 2.2(2) and Policy 2.2
Sanction – Sadeghi was ordered to pay a $25,000 fine, an additional fine of $9,111.75 representing
disgorgement of the financial benefit received by him as a result of his improper trading activity; andto pay costs in the amount of $25,000, and the panel imposed a suspension of access to IIROCregulated marketplaces for 5 years.
Disciplinary Proceedings:

In the Matter of Instinet Canada (“Instinet”) (June 30, 2020), 2020 IIROC 18
Facts – Between January 2016 and February 2018 (the “Relevant Period”), the Respondent failed
to comply with its trading supervision obligations to prevent and detect potential contraventions of
UMIR 2.2 and UMIR Policy 2.2 by one of its direct electronic access clients. In particular, orders
were entered on visible IIROC-regulated marketplaces that changed the best bid price or best ask
price and affected the price at which trades would occur with orders posted in marketplaces whereorders are not visible to marketplace participants.
Disposition and Sanction – Pursuant to a Settlement Agreement, Instinet admitted that it failed, tocomply with its trading supervision obligations to prevent and detect potential contraventions of
UMIR 2.2 and UMIR Policy 2.2 by one of its direct electronic access clients, contrary to UMIR 7.1
and UMIR Policy 7.1. Instinet agreed to a fine of $155,000 and costs of $15,000.
Requirements Considered – Rule 2.2, Policy 2.2, UMIR 7.1 and Policy 7.1.

Disciplinary Proceedings:

In the Matter of Remo Costa (“Costa”) (May 14, 2019), 2019 IIROC 15
Facts – During five (5) days between July 28, 2015 and September 28, 2015, Costa, a client anddirector of JitneyTrade Inc., entered orders or executed transactions on the Toronto Stock
Exchange (TSX) when he knew, or ought reasonably to have known, that the entry of such orders
or the execution of the transactions would create or could reasonably be expected to create a false
or misleading appearance of trading activity with respect to these securities, or an artificial saleprice for the securities, contrary to UMIR Rule 2.2(2) and Policy 2.2.
Disposition and Sanction – After a contested hearing, a hearing panel found Costa liable andordered a fine of $25,000, costs of $15,000, and a suspension of registration in any capacity for 6
months.
Requirements Considered – Rule 2.2(2) and Policy 2.2.

Part 2 – Abusive Trading
July 27, 2023

UMIR 2.2-14

Universal Market Integrity Rules

Rules & Policies

2.3

Improper Orders and Trades
A Participant or Access Person shall not enter an order on a marketplace or execute a
trade if the Participant or Access Person knows or ought reasonably to know that thatthe entry of the order or the execution of the trade would not comply with or would resultin the violation of:(a)applicable securities legislation;(b)applicable requirements of any self-regulatory entity of which the Participant orAccess Person is a member;(c)

the Marketplace Rules of the marketplace on which the order is entered;(d)the Marketplace Rules of the marketplace on which the trade is executed; and(e)

UMIR and the Policies.

Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
NI 21-101 section 1.1 – “order” and “self-regulatory entity”
UMIR section 1.1 – “Access Person”, “marketplace”, “Marketplace Rules”, “Participant”,“Policy” and “UMIR”
UMIR section 1.2(2) – “trade”

Related Provisions:

UMIR Policy 1.2 Part 3 – interpretation of “ought reasonably to know”

Regulatory History:

Effective April 1, 2005, the applicable securities commissions approved an amendment
to add Rule 2.3. See Market Integrity Notice 2005-011 - “Provisions Respecting
Manipulative and Deceptive Activities” (April 1, 2005).
In connection with the recognition of IIROC and its adoption of UMIR, the applicablesecurities commissions approved an amendment to Rule 2.3 that came into force onJune 1, 2008 to make editorial changes. See Footnote 1 in Status of Amendments.

Partially Repealed Guidance: See IIROC Rules Notice 11-0043 - “Guidance on “Locked” and “Crossed Markets”(February 1, 2011). Questions 2, 5, 9 of Notice 11-0043 were repealed and replaced
effective January 2, 2018 by IIROC Notice 17-0138 – “Guidance on Best Execution”(July 6, 2017).
Disciplinary Proceedings:

In the Matter of Sean Conacher (“Conacher”) (April 6, 2018) DN 18-0073
Facts – Between June 2013 and October 2013, Conacher, the Ultimate Designated
Person at Blackwatch Capital Corp., allowed a U.S. based client to enter orders directly
on an IIROC-regulated marketplace through a firm inventory account assigned to him.
Conacher knew or ought reasonably to have known that permitting the Client to enter
orders and execute trades directly to the marketplace through a firm inventory accountwould result in a failure to comply with applicable regulatory requirements.
Disposition – Pursuant to a Settlement Agreement, Conacher admitted that he permitted
trades to be executed that he knew or ought reasonably to have known would notcomply with applicable regulatory requirements, contrary to UMIR 2.3.
Requirements Considered – Rule 2.3.
Sanction – Conacher agreed to pay a fine of $15,000, to a suspension of access to
IIROC-regulated marketplaces for 3 months, and to pay costs in the amount of $2,000.

Part 2 – Abusive Trading
June 1, 2008

UMIR 2.3-1

Universal Market Integrity Rules

Rules & Policies

PART 3 – SHORT SELLING
3.1

Restrictions on Short Selling – Repealed

POLICY 3.1 – RESTRICTIONS ON SHORT SELLING – Repealed
Part 1 – Entry of Short Sales Prior to the Opening – Repealed
Part 2 – Short Sale Price When Trading Ex-Distribution – Repealed
Regulatory History:

Effective August 27, 2004, the applicable securities commissions approved the amendment to permit ashort sale of an Exchange-traded Fund on a downtick. See Market Integrity Notice 2004-023 –“Provisions Respecting Short Sales” (August 27, 2004).
Effective April 8, 2005, the applicable securities commissions approved an amendment to permit a shortsale of a Basis Order on a downtick. See Market Integrity Notice 2005-010 – “Provisions Respecting a“Basis Order”” (April 8, 2005).
Effective March 9, 2007, the applicable securities commissions approved an amendment to permit a shortsale of a Closing Price Order on a downtick. See Market Integrity Notice 2007-002 – “Provisions
Respecting Competitive Marketplaces” (February 26, 2007).
Effective May 16, 2008, the applicable securities commissions approved an amendment to permit a shortsale on a downtick if the order is made for purposes of complying with the Order Protection Rule. See
Market Integrity Notice 2008-008 – “Provisions Respecting “Off-Marketplace” Trades” (May 16,2008).
In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to clause (h) at subsection (2) of Rule 3.1 that came into force onJune 1, 2008 to replace the phrase “Rule or” with “provision of UMIR or a ”. See Footnote 1 in Status ofAmendments.
Effective January 8, 2010, the applicable securities commissions approved amendments to replace thewords “Exchange-traded Fund” with “Exempt Exchange-traded Fund”. See IIROC Notice 10-0006 –“Provisions Respecting Trading During Certain Securities Transactions” (January 8, 2010).
Effective August 26, 2011, the applicable securities commissions approved amendments to repeal areference to “Market Maker Obligations” and replace it with a reference to “Marketplace Trading
Obligations”. See IIROC Notice 11-0251 - “Provisions Respecting Market Maker, Odd-Lot and otherMarketplace Trading Obligations” (August 26, 2011).
On March 2, 2012, the applicable securities commissions approved amendments to repeal Rule 3.1 andPolicy 3.1 effective October 15, 2012. See IIROC Notice 12-0078 – “Provisions Respecting
Regulation of Short Sales and Failed Trades” (March 2, 2012). Prior to that date, Rule and Policy 3.1
provided:
3.1

Restrictions on Short Selling(1)

Except as otherwise provided, a Participant or Access Person shall not make a shortsale of a security on a marketplace unless the price is at or above the last sale price.

(2)

A short sale of a security may be made on a marketplace at a price below the last saleprice if the sale is:(a)a Program Trade in accordance with Marketplace Rules;(b)made in furtherance of the Marketplace Trading Obligations of that marketplace;(c)

for an arbitrage account and the seller knows or has reasonable grounds tobelieve that an offer enabling the seller to cover the sale is then available and theseller intends to accept such offer immediately;(d)for the account of a derivatives market maker and is made:(i)Part 3 – Short Selling
October 15, 2012in accordance with the market making obligations of the seller in connection
with the security or a related security, and

UMIR 3.1-1

(ii)
(e)

(f)

to hedge a pre-existing position in the security or a related security;

the first sale of the security on any marketplace made on an ex-dividend, ex-rights
or ex-distribution basis and the price of the sale is not less than the last sale pricereduced by the cash value of the dividend, right or other distribution;
the result of:(i)a Call Market Order,(ii)

a Market-on-Close Order,(iii) a Volume-Weighted Average Price Order,(iv) a Basis Order, or(v)

a Closing Price Order;(g)a trade in an Exempt Exchange-traded Fund; or(h)made to satisfy an obligation to fill an order imposed on a Participant or Access
Person by any provision of UMIR or a Policy.

POLICY 3.1 – RESTRICTIONS ON SHORT SELLING
Part 1 – Entry of Short Sales Prior to the Opening
Prior to the opening of a marketplace on a trading day, a short sale may not be entered on thatmarketplace as a market order and must be entered as a limit order and have a limit price at or above
the last sale price of that security as indicated in a consolidated market display (or at or above theprevious day’s close reduced by the amount of a dividend or distribution if the security will commence
ex-trading on the opening).
Part 2 – Short Sale Price When Trading Ex-Distribution
When reducing the price of a previous trade by the amount of a distribution, it is possible that theprice of the security will be between the trading increments. (For example, a stock at $10 with adividend of $0.125 would have an ex-dividend price of $9.875. A short sale order could only beentered at $9.87 or $9.88.) Where such a situation occurs, the price of the short sale order should be
set no lower than the next highest price. (In the example, the minimum price for the short sale would
be $9.88, being the next highest price at which an order may be entered to the ex-dividend price of$9.875).
In the case of a distribution of securities (other than a stock split) the value of the distribution is notdetermined until the security that is distributed has traded. (For example, if shareholders of ABC Co.
receive shares of XYZ Co. in a distribution, an initial short sale of ABC on an ex-distribution basis may
not be made at a price below the previous trade until XYZ Co. has traded and a value determined).
Once a security has traded on an ex-distribution basis, the regular short sale rule applies and therelevant price is the previous trade.
Guidance:

See Market Integrity Notice 2004-020 - “Sales of Restricted Securities” (August 13, 2004) pertaining towhether a sale involving a “restricted” security should be marked as a “short sale”.

Repealed Guidance:

See Market Integrity Notice 2005-023 - “Securities Trading on Multiple Marketplaces” (July 29, 2005).
Effective September 1, 2006, Market Integrity Notice 2005-023 was repealed and replaced by Market
Integrity Notice 2006-017 - “Securities Trading on Multiple Marketplaces” (September 1, 2006).

Repealed Guidance:

See Market Integrity Notice 2005-024 - “Short Sales Made in Furtherance of Market Maker
Obligations” (July 27, 2005). Effective October 15, 2012, Market Integrity Notice 2005-024 was repealed
and replaced by IIROC Notice 12-0300 – Guidance on “Short Sale and Short-Marking Exempt Order
Designations (October 11, 2012).

Repealed Guidance:

See Market Integrity Notice 2005-025 - “Bundling Orders from a Long and Short Position” (July 27,2005). Effective October 15, 2012, Market Integrity Notice 2005-025 was repealed and replaced by IIROC
Notice 12-0300 – Guidance on Short Sale and Short-Marking Exempt Order Designations” (October
11, 2012).

Guidance:

See Market Integrity Notice 2005-028 - “Sale of Securities Subject to Transfer Restrictions Only in
the United States” (July 29, 2005).

Part 3 – Short Selling
October 15, 2012

UMIR 3.1-2

Guidance:

See Market Integrity Notice 2006-006 - “Sale of Securities Subject to Certain United States
Securities Laws” (February 17, 2006).

Repealed Guidance:

See Market Integrity Notice 2006-010 - “Short Sale Designations and Restrictions” (April 7, 2006).
Effective October 15, 2012, Market Integrity Notice 2006-010 was repealed and replaced by IIROC Notice12-0300 – Guidance on Short Sale and Short-Marking Exempt Order Designations” (October 11,2012).

Guidance:

See Market Integrity Notice 2006-017 – “Securities Trading on Multiple Marketplaces” (September 1,2006). See also guidance for Rules 5.1, 5.2, 5.3, 7.7 and 8.1.

Guidance:

See Market Integrity Notice 2007-003 – “‘Principal Market’ Determination for 2007” (February 28,2007).

Guidance:

See Market Integrity Notice 2007-014 - “Exemption of Certain Inter-listed Securities from Price
Restrictions on Short Sales” (July 6, 2007).

Partially Repealed Guidance: See Market Integrity Notice 2007-015 – “Specific Questions Related to Trading on Multiple
Marketplaces” (August 10, 2007). See also guidance for Rules 2.2, 5.1, and 7.1. Questions 5, 8,
9 and 12 in MIN 2007-015 were repealed and replaced effective May 16, 2008 by Market Integrity
Notice 2008-010 – “Guidance – Complying with “Best Price” Obligations” (May 16, 2008).
Questions 7, 8 and 10 of MIN 2007-015 were partially repealed effective January 2, 2018 by
IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).
Guidance:

See Market Integrity Notice 2008-002 – “‘Principal Market’ Determination for 2008” (January 11,2008).

Guidance:

See IIROC Notice 08-0101 - “Restated Reminder Respecting Obligations in the Conduct of Short
Sales” (September 23, 2008) which, effective as of September 23, 2008, revised and replaced IIROC
Notice 08-0098 - “Reminder Respecting Obligations in the Conduct of Short Sales” (September 22,2008).

Guidance:

See IIROC Notice 08-0121 – “Extension of the Prohibition of Short Sales of Financial Sector
Issuers” (October 6, 2008).

Guidance:

See IIROC Notice 09-0007 – “‘Principal Market’ Determination for 2009” (January 9, 2009).

Guidance:

See IIROC Notice 10-0095 – “‘Principal Market’ Determination for 2010” (April 6, 2010).

Repealed Guidance:

See IIROC Notice 12-0300 – “Guidance on Short Sale and Short-Marking Exempt Order
Designations” (October 11, 2012).This Notice was repealed and replaced effective April 11, 2016 by
IIROC Notice 16-0029 – “Updated Guidance on “Short Sale” and “Short-Marking Exempt” Order
Designations” (February 11, 2016).

Guidance:

See IIROC Notice 16-0029 – “Updated Guidance on “Short Sale” and “Short-Marking Exempt”
Order Designations” (February 11, 2016).

Disciplinary Proceedings:

In the Matter of Salman Partners Inc. (“Salman”), Sameh Magid (“Magid”), William Burk(“Burk”) and Ian Todd (“Todd”) (February 18, 2005) SA 2005-001
Facts – Between April 1, 2002 and July 30, 2002, Salman engaged in a paired trading strategy with
one of its institutional clients which it erroneously believed constituted arbitrage trading. The
arrangement did not in fact constitute arbitrage trading for the purposes of UMIR, and as such, thetrades entered as part of the strategy did not benefit from the various exemptions provided for under
UMIR, and caused Salman to violate numerous UMIR provisions. In April 2002, Salman engaged in
trading in a second issuer that resulted in certain transactions being recorded off-market when thosetransactions ought to have been posted on an exchange. Finally, in another trade, Salman failed toproperly supervise a trader’s attempt to cover a short position in an issuer when a client submitted abuy order in the same security. Throughout these events, Salman failed to maintain a proper audit
trail for their order flow.
Disposition – Salman failed to develop and implement appropriate policies and procedures to fulfill its
compliance and supervisory obligations in relation to its trading on marketplaces regulated by RS,
including failing to ensure that employees with supervisory responsibilities had clearly defined roles
and responsibilities and that audit trail requirements were complied with. Several senior officers were
found to have failed in their supervisory responsibilities as well.
Requirements Considered – Rules 3.1, 5.3(6), 6.2(1)(b)(viii) and (x), 6.4, 7.1 and 10.11(1) and Policy
7.1
Sanction Salman Partners Inc. -Part 3 – Short Selling
October 15, 2012

$600,000 fine and costs of $90,000

UMIR 3.1-3

Disciplinary Proceedings:

Part 3 – Short Selling
October 15, 2012

Sameh Magid -$80,000 fine and costs of $15,000; personal undertakings

William Burk -$30,000 fine

Ian Todd -$30,000 fine

Rule 3.1 was considered In the Matter of Vinh-Phat Nguyen-Qui (“Nguyen-Qui”) (October 11,2012) DN 12-0298. See Disciplinary Proceedings under Rule 2.2.

UMIR 3.1-4

Universal Market Integrity Rules

Rules & Policies

3.2

Prohibition on the Entry of Orders(1)

A Participant or Access Person shall not enter an order to sell a security on amarketplace that on execution would be a short sale:(a)unless the order is marked as a short sale in accordance with subclause
6.2(1)(b)(viii); or(b)

if the security is a Short Sale Ineligible Security at the time of the entry of theorder.

(2)

Clause (a) of subsection (1) does not apply to an order that has been designatedas a “short-marking exempt order” in accordance with subclause 6.2(1)(b)(ix).

(3)

Clause (b) of subsection (1) does not apply to an order entered on a marketplace:(a)in furtherance of the Marketplace Trading Obligations of that marketplace;(b)

for the account of a derivatives market maker and is entered:

(c)

(i)

in accordance with the market making obligations of the seller inconnection with the security or a related security, and(ii)

to hedge a pre-existing position in the security or a related security;

as part of a Program Trade in accordance with Marketplace Rules;(d) to satisfy an obligation to fill an order imposed on a Participant or Access
Person by any provision of UMIR or a Policy; or(e) that is of a class of security or type of transaction that has been designatedby a Market Regulator.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “derivatives market maker”, “hedge”, “Market Regulator”,“marketplace”, “Marketplace Rules”, “Marketplace Trading Obligations”, “Participant”, “Policy”, “Program
Trade”, “related security”, “short sale”, “short-marking exempt order”, “Short Sale Ineligible Security”
and “UMIR”

Guidance:

See IIROC Notice 22-0130 – “Guidance on Participant Obligations to have Reasonable Expectation
to Settle any Trade Resulting from the Entry of a Short Sale Order” (August 17, 2022).

Regulatory History:

On October 15, 2008, the applicable securities commissions approved amendments to UMIR to add
section 3.2 that came into force on October 14, 2008. See IIROC Notice 08-0143 - “Provisions
Respecting Short Sales and Failed Trades” (October 15, 2008).
Effective August 26, 2011, the applicable securities commissions approved amendments to Rule 3.2 toreplace in subsection (2) the phrase “an Exchange or QTRS in accordance with the Marketplace Rules”
with “a marketplace” and to replace the phrase “applicable Market Maker Obligations” with “Marketplace
Trading Obligations of that marketplace” and to replace clause (a) of subsection (3) of Rule 3.2. See
IIROC Notice 11-0251 – “Provisions Respecting Market Maker, Odd Lot and Other Marketplace
Trading Obligations” (August 26, 2011).
On March 2, 2012, the applicable securities commissions approved amendments to section 3.2,
effective October 15, 2012, to delete the reference in clause (a) of subsection (1) to “or subclause
6.2(1)(b)(ix)” and to repeal and replace subsection (2). See IIROC Notice 12-0078 - “Provisions
Respecting Regulation of Short Sales and Failed Trades” (March 2, 2012).

Part 3 – Short Selling
August 17, 2022

UMIR 3.2-1

Universal Market Integrity Rules

Rules & Policies

PART 4 – FRONTRUNNING
4.1

Frontrunning
(1)

(2)

A Participant with knowledge of a client order that on entry could reasonably be
expected to affect the market price of a security or a derivative, shall not, prior to
the entry of such client order,(a)enter a principal order or a non-client order on a marketplace, foreignorganized regulated market or other market, including any over-the-countermarket, for the purchase or sale of the security, derivative or any related
security or related derivative;(b)

solicit an order from any other person for the purchase or sale of the security,
the derivative, or any related security or related derivative; or(c)inform any other person, other than in the necessary course of business, ofthe client order.

A Participant does not contravene subsection (1) if:(a)no director, officer, partner, employee or agent of the Participant who madeor participated in making the decision to enter a principal order or non-client
order or to solicit an order had actual knowledge of the client order;(b)

an order is entered or trade made for the benefit of the client for whose
account the order is to be made;(c)an order is solicited to facilitate the trade of the client order;(d)a principal order is entered to hedge a position that the Participant had
assumed or agreed to assume before having actual knowledge of the client
order provided the hedge is:(i)commensurate with the risk assumed by the Participant, and(ii)

entered into in accordance with the ordinary practice of the Participant
when assuming or agreeing to assume a position in the security;(e)a principal order is made to fulfil a legally binding obligation entered into by
the Participant before having actual knowledge of the client order; or(f)the order is entered for an arbitrage account.

POLICY 4.1 – FRONTRUNNING
Part 1 – Examples of Frontrunning
Rule 4.1 provides that no Participant shall trade in equities or derivatives to take advantage of
information concerning a client order that has not been entered on a marketplace thatreasonably can be expected to change the prices of the equities or the related derivatives.
Without limiting the generality of the Rule, the following are examples of transactions covered by
the prohibition:

Part 4 - Frontrunning
December 14, 2022

UMIR 4.1-1

(a)a transaction in an option, including an option where the underlying interest is anindex, when the Participant has knowledge of the unentered client order for theunderlying securities;(b)a transaction in a future where the underlying interest is an index when theParticipant has knowledge of the unentered client order that is a program trade orindex option transaction; and(c)a transaction in an index option when the Participant has knowledge of theunentered client order that is a program trade or an index futures transaction.

Rule 10.4 extends the prohibition to cover orders entered by a related entity of the Participant ora director, officer, partner or employee of the Participant or a related entity of the Participant.

Part 2 – Specific Knowledge Required
In order to constitute frontrunning contrary to Rule 4.1, the person must have specificknowledge concerning the client order that, on entry, could reasonably be expected to affect themarket price of a security or derivative. A person with knowledge of such a client order must
insure that the client order has been entered on a marketplace before that person can:•enter a principal order or non-client order for the security, derivative, any related security
or any related derivative;•

solicit an order for the security, derivative, any related security or any related derivative;or•inform any other person about the client order, other than in the necessary of course ofbusiness.

Trading based on non-specific pieces of market information, including rumours, does notconstitute frontrunning.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation – “security”
UMIR section 1.1 – “arbitrage account”, “client order”, “derivative”, “employee”, “foreign organizedregulated market”, “hedge”, “marketplace”, “non-client order”, “Participant”, ”principal order”, “Program
Trade”, “related derivative”, “related entity” and “related security”
UMIR section 1.2(2) – “person” and “trade”

Regulatory History:

Effective May 16, 2008, the applicable securities commissions approved an amendment to Rule 4.1 toreplace the phrase “stock exchange or market” with “foreign organized regulated market or othermarket” See Market Integrity Notice 2008-008 – “Provisions Respecting “Off-Marketplace” Trades”(May 16, 2008).
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French version of UMIR”(December 9, 2013).
Effective December 14, 2022, the applicable securities commissions approved amendments to Rule 4.1
and Policy 4.1. See IIROC Notice 22-0140– “Amendments Respecting the Trading of Derivatives
on a Marketplace” (September 15, 2022).

Disciplinary Proceedings:

Rule 4.1(1)(c) was considered In the Matter of Garett Steven Prins (“Prins”) (April 1, 2003) OOS
2003-001. See disciplinary proceedings under 2.1.

Disciplinary Proceedings:

In the Matter of Frank Patrick Greco (“Greco”) (May 28, 2003) Decision 2003-004
Facts – Between November 22, 2001 and April 1, 2002, Greco, a Registered Trader employed at
Griffiths McBurney & Partners, traded on information respecting pending undisclosed client orders
obtained from a trader at another Participant resulting in frontrunning and conduct inconsistent withjust and equitable principles of trade by Greco. Also, during this period Greco failed to properly
designate short sales and executed prohibited trades in a security at a time when his employer wasPart 4 - Frontrunning
December 14, 2022

UMIR 4.1-2

involved in a distribution of the security.
Held – Taking advantage of information respecting a client order that has not yet been entered in amarketplace to trade ahead of the client order harms the integrity of the marketplace. Greco acted
contrary to just and equitable principles of trade and violated the frontrunning provisions of UMIR
and the Toronto Stock Exchange rules.
Requirements Considered – TSX Rules 4-204(1), 4-301(1) and (8) and 7-106(1)(b); Comparable
UMIR Provision Rules 4.1(1)(a) and 2.1(1)Sanction - $65,000 fine and costs of $17,000; disgorgement of $2,105 of benefits; suspension fromaccess to the Toronto Stock Exchange for three months
Disciplinary Proceedings:

In the Matter of Donald Greco (“Greco”) (July 15, 2003) Decision 2003-005
Facts – On November 22, 2001, Greco, a registered trader, with knowledge of an undisclosed
pending client order in a particular security used that information to buy shares in the security.
Held – With knowledge of an undisclosed client order which could reasonably be expected to affectthe market price of such security, Greco traded in this security, and as such, contravened TSX Rule
4-204(1).
Requirements Considered – TSX Rule 4-204(1). Comparable UMIR Provision – Rule 4.1
Sanction - $15,000 fine and costs of $10,000; disgorgement of $250; one month suspension

Disciplinary Proceedings:

Rule 4.1 was considered In the Matter of Kai Tolpinrud (“Tolpinrud”) (January 16, 2006) OOS
2004-001. See Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

In the Matter of Jason Fediuk (“Fediuk”) (February 15, 2005) Decision 2005-002
Facts – Fediuk, a trader at Salman Partners Inc. (“Salman”), had an outstanding short position in
TVX, a TSX listed issuer, in his personal account. On April 26, 2002, a Salman client placed asignificant buy order for shares of TVX with a trader that worked in close physical proximity to
Fediuk. Within minutes of the Salman client order being received by that trader, Fediuk placed ajitney order to buy shares of TVX to cover his outstanding short position.
Held – While the Panel agreed that the timing of the trades and use of an undisclosed jitney order toavert losses in his personal account was suspicious, it held that RS did not prove that Fediuk knewof the client order when he entering trades for his personal account.
Requirements Considered – Rule 4.1(1)(a)Disposition – charges against Fediuk dismissed

Part 4 - Frontrunning
December 14, 2022

UMIR 4.1-3

PART 5 – BEST EXECUTION OBLIGATION
5.1

Best Execution of Client Orders - Repealed

Regulatory History:

Effective January 2, 2018, the applicable securities commissions approved amendments to repeal
Rule 5.1 of UMIR. See IIROC Notice 17-0137 – “Amendments Respecting Best Execution” (July6, 2017).

POLICY 5.1 – BEST EXECUTION OF CLIENT ORDERS - Repealed
Defined Terms:

NI 14-101 – section 1.1(3) – “foreign jurisdiction”
NI 21-101 – section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
NI 23-101 – section 1.1 – “directed-action order”
UMIR section 1.1 – “better price”, “client order”, “consolidated market display”, “foreign organizedregulated market”, “Market Regulator”, “marketplace” and “Participant”
UMIR section 1.2(2) – “trade”

Related Provisions:

UMIR sections 6.2 and 6.4; NI 23-101 – Part 6

Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment to Policy 5.1
to add Part 2. See Market Integrity Notice 2007-002 – “Provisions Respecting Competitive
Marketplaces” (February 25, 2007).
Effective May 16, 2008, the applicable securities commissions approved an amendment to Part 2 ofPolicy 5.1 to replace the phrase “organized regulated markets outside of Canada” with “foreignorganized regulated markets”. See Market Integrity Notice 2008-008 – “Provisions Respecting “OffMarketplace” Trades” (May 16, 2008).
Effective September 12, 2008, the applicable securities commissions approved an amendment toreplace Rule 5. And Policy 5.11. See IIROC Notice 08-0039 – “Provisions Respecting Best
Execution” (July 18, 2008).
Effective February 1, 2011, the applicable securities commissions approved an amendment to repeal
and replace Part 4 of Policy 5.1. See IIROC Notice 11-0036 – “Provisions Respecting the
Implementation of the Order Protection Rule” (January 28, 2011).
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 – Notice of Approval and Implementation –“Amendments to the French version of UMIR” (December 9, 2013).
Effective January 2, 2018, the applicable securities commission approved an amendment to repeal
Policy 5.1. See IIROC Notice 17-0137 – “Amendments Respecting Best Execution” (July 6, 2017).

Partially Repealed Guidance: See Market Integrity Notice 2006-017 – “Securities Trading on Multiple Marketplace”(September 1, 2006). Section respecting Rule 5.1 – Best Execution of Client Orders of MIN 2006-017
was partially repealed and replaced effective January 2, 2018 by IIROC Notice 17-0138 – “Guidanceon Best Execution” (July 6, 2017).
Partially Repealed Guidance: See Market Integrity Notice 2007-015 – “Specific Questions Relating to Trading on Multiple
Marketplaces” (August 10, 2007). Questions 5, 8, 9 and 12 in MIN 2007-015 were repealed andreplaced effective May 16, 2008 by Market Integrity Notice 2008-010 – “Guidance – Complying with“Best Price” Obligations” (May 16, 2008). Questions 7, 8 and 10 of this Notice were partially repealed
and replaced effective January 2, 2018 by IIROC Notice 17-0138 – “Guidance on Best Execution”(July 6, 2017).
Partially Repealed Guidance: See Market Integrity Notice 2007-019 – “Entering Client Orders on Non-transparent
Marketplaces and Facilities” (September 21, 2009). Questions 2 and 6 of this Notice were partiallyrepealed and replaced effective January 2, 2018 by IIROC Notice 17-0138 – “Guidance on Best
Execution” (July 6, 2017).
Repealed Guidance:

See IIROC Notice 09-0244 –"Best Execution" and "Best Price" Obligations For Securities Listed

Part 5 – Best Execution Obligation
August 30, 2021

UMIR 5.1-1

On TSX Venture Exchange” (August 27, 2009). This Notice was repealed and replaced effective
January 2, 2018 by IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).
Partially Repealed Guidance: See IIROC Notice 11-0043 – “Guidance on “Locked” and “Crossed” Markets” (February 1,2011). Questions 2, 5 and 9 this Notice were partially repealed and replaced effective January 2, 2018by IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).
Repealed Guidance:

See Notice 11-0113 – “Guidance on Best Execution and Management of Orders” (March 30, 2011).
This Notice was repealed and replaced effective January 2, 2018 by IIROC Notice 17-0138 –“Guidance on Best Execution” (July 6, 2017).

Repealed Guidance:

See IIROC Notice 11-0114 – “Guidance Respecting the Use of Certain Order Types” (March 30,2011). This Notice was repealed and replaced effective January 2, 2018 by IIROC Notice 17-0138 –“Guidance on Best Execution” (July 6, 2017).

Guidance:

See IIROC Notice 13-0191 – “Guidance Respecting the Management of Stop Loss Orders” (July11, 2013).

Guidance:

See IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017)

Disciplinary Proceedings:

In the Matter of TD Securities Inc. (“TDSI”) (July 5, 2006) DN 2006-007
Facts – Between December 2003 and January 2005, TDSI on numerous occasions failed totransmit retail client orders to Dealer A, a CNQ Market Maker, for entry onto the CNQ marketplace.
TDSI held back client orders that were either not immediately tradeable or which remained outside
the posted quote until expiry, including orders for less than 50 standard trading units. Such orders
expired unfilled without ever being entered onto CNQ. It was also found that TDSI failed to maintaina complete audit trail relating to these orders.
Disposition – TDSI failed to meet its obligations under several provisions of UMIR in relation to thehandling, trading, compliance and supervision of retail client orders for CNQ listed securities. In
failing to adequately consider and plan with supervisory, compliance and trading staff an appropriate
method of handling and monitoring client orders for CNQ, TDSI failed to fulfil its best execution andorder exposure obligations to clients in respect of some CNQ orders. In failing to adopt adequate
policies and procedures to be followed by its employees TDSI failed to fulfil its supervisoryobligations under UMIR.
Requirements Considered – Rules 5.1, 6.3(1), 10.11(1), 10.12(1), 7.1(1) and Policy 7.1.
Sanctions - $350,000 fine and costs of $80,000.

Part 5 – Best Execution Obligation
August 30, 2021

UMIR 5.1-2

Universal Market Integrity Rules

Rules & Policies

5.2

Best Price Obligation – Repealed

POLICY 5.2 – BEST PRICE OBLIGATION – Repealed
Regulatory History:

Effective April 8, 2005, the applicable securities commissions approved an amendment to confirm thatthe best price obligation does not apply to Basis Orders. See Market Integrity Notice 2005-010 –“Provisions Regarding a “Basis Order”” (April 8, 2005).
Effective March 9, 2007, the applicable securities commissions approved an amendment to confirm thatthe best price obligation does not apply to Closing Price Orders, and to change the factors that may beconsidered in Part 1 of Policy 5.2 (“Qualification of Obligation”). See Market Integrity Notice 2007-002 –“Provisions Respecting Competitive Marketplaces” (February 26, 2007).
Effective May 16, 2008, the applicable securities commissions approved amendments to Rule andPolicy 5.2 to account for off-marketplace trades. See Market Integrity Notice 2008-008 – “Provisions
Respecting “Off-Marketplace” Trades” (May 16, 2008).
Effective May 16, 2008 (retroactively), the applicable securities commissions approved amendments toRule 5.2 to repeal the reference to transaction fees and to Policy 5.2 to revise Part 1 – Qualification of
Obligation. See IIROC Notice 09-0107 – “Provisions Respecting the “Best Price” Obligation” (April
17, 2009).
Effective February 1, 2011, the applicable securities commissions approved amendments to repeal Rule5.2 and Policy 5.2. See IIROC Notice 11-0036 – “Provisions Respecting the Implementation of theOrder Protection Rule” (January 28, 2011).

Repealed Guidance:

See Market Integrity Notice 2005-015 – “Complying with “Best Price” Obligations” (May 12, 2005).
This Market Integrity Notice was repealed and replaced by Market Integrity Notice 2006-017 –“Securities Trading on Multiple Marketplaces”(September 1, 2006).

Repealed Guidance:

See Market Integrity Notice 2005-023 – “Securities Trading on Multiple Marketplaces” (July 29,2005). This Market Integrity Notice was repealed and replaced by Market Integrity Notice 2006-017 –“Securities Trading on Multiple Marketplaces”(September 1, 2006).

Partially Repealed Guidance:

See Market Integrity Notice 2006-017– “Guidance – Securities Trading on Multiple
Marketplaces” (September 1, 2006). Sections of this Market Integrity Notice relating to UMIR
5.2 were repealed by Market Integrity Notice 2008-010 – Guidance – “Complying with “Best
Price” Obligations” (May 16, 2008). Section respecting Rule 5.1 – Best Execution of Client
Orders of MIN 2006-017 was partially repealed effective January 2, 2018 by IIROC Notice 170138 – “Guidance on Best Execution” (July 6, 2017).

Partially Repealed Guidance:

See Market Integrity Notice 2007-015 – “Guidance – Specific Questions Related to Tradingon Multiple Marketplaces” (August 10, 2007). Questions 5, 8, 9 and 12 in MIN 2007-015 wererepealed and replaced effective May 16, 2008 by Market Integrity Notice 2008-010 –“Guidance – Complying with “Best Price” Obligations” (May 16, 2008). Questions 7, 8 and
10 of MIN 2007-015 were partially repealed effective January 2, 2018 by IIROC Notice 17-0138– “Guidance on Best Execution” (July 6, 2017).

Partially Repealed Guidance:

See Market Integrity Notice 2007-019 – “Entering Client Orders on Non-Transparent
Marketplaces and Facilities” (September 21, 2007). Questions 2 and 6 of this Notice werepartially repealed and replaced effective January 2, 2018 by IIROC Notice 17-0138 – “Guidanceon Best Execution” (July 6, 2017).

Repealed Guidance:

See Market Integrity Notice 2007-021 – “Expectations Regarding “Best Price” Obligations”(October 24, 2007). This Market Integrity Notice was repealed and replaced by Market Integrity 2008010 – “Complying with “Best Price” Obligations” (May 16, 2008).

Partially Repealed Guidance: See IIROC Notice 2008-010 – “Complying with “Best Price” Obligations” (May 16, 2008).
Question 8 in reference to Market Integrity Notice 2007-015 and Question 5 in reference to Market
Integrity Notice 2006-020 of this Notice were partially repealed and replaced effective January 2, 2018by IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).
Guidance:

See IIROC Notice 08-0028 – “Entering Orders on a Protected Marketplace that supports Hidden
Order Types” (July 14, 2008).

Part 5 – Best Execution Obligation
February 1, 2011

UMIR 5.2-1

Guidance:

See IIROC Notice 09-0108 – “Specific Questions Related To The ‘Best Price’ Obligation” (April 17,2009).

Guidance:

See IIROC Notice 09-0224 – “Procedures For Handling Certain Designated Trades As Principal”(July 30, 2009).

Repealed Guidance:

See IIROC Notice 09-0244 –"Best Execution" and "Best Price" Obligations For Securities Listed
On TSX Venture Exchange” (August 27, 2009). This Notice was repealed and replaced effective
January 2, 2018 by IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).

Partially Repealed Guidance: See IIROC Notice 11-0043 – “Guidance on “Locked” and “Crossed” Markets” (February 1,2011). Questions 2, 5 and 9 of Notice 11-0043 were partially repealed effective January 2, 2018 by
IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).
Disciplinary Proceedings:

Rule 5.2 was considered In the Matter of Gerald Douglas Phillips (“Phillips”) (February 26,2004) SA 2004-002. See Disciplinary Proceedings under 2.1.

Disciplinary Proceedings:

In the Matter of Magna Partners Ltd. (“Magna”) (November 16, 2010) DN 10-0295
Facts – Between October 2008 and May 2010, Magna failed to make reasonable efforts to meet its
best price obligations as it did not make reasonable efforts to have access to all protectedmarketplaces, in particular Alpha, CNSX, Omega and Chi X. After determining that the costs ofbecoming a member of each protected marketplace were too great, Magna did not make inquiries
into any of the other methods of accessing the various marketplaces, such as by way of jitney or
Smart Order Router, until following the commencement of an IIROC investigation in July, 2009.
Magna further failed to maintain adequate policies and procedures, including to test for “tradethroughs” and to monitor and document the levels of trading on each marketplace, in order to ensure
reasonable efforts were made to execute orders at the best price.
Disposition – Magna admitted that it breached UMIR when it failed to make reasonable efforts tomeet its best price obligations by connecting to all available “protected marketplaces” and in failingto have adequate policies and procedures in place to address best price obligations. The best priceobligation set out in UMIR 5.2 is a general duty owed to the market as a whole to ensure fairness to
all market participants and to promote competition, efficiency, and transparency while maintaining
investor confidence in the market. UMIR Policy 5.2 requires IIROC regulated member firms to adopt
policies and procedures that will ensure compliance with their ongoing best price obligations andreflect changes in the trading environment and market structure.
Requirements Considered – Rule 5.2, 7.1 and Policy 5.2.
Sanction - A Hearing Panel imposed a fine of $100,000 and costs in the amount of $10,000 against
Magna.
Review – Further to review by the Ontario Securities Commission, the Commission substituted its
own penalty decision for that of the IIROC Hearing Panel and reduced the fine to $30,000.

Disciplinary Proceedings:

In the Matter of BMO Nesbitt Burns (“BMONB”) (August 25, 2010) DN 10-0228
Facts – In November 2008, BMONB was advised by IIROC of “a larger than average” number of“trade through” alerts which identify possible “best price” violations. At that time, BMONB had not yet
connected to two protected marketplaces, namely Chi-X or Omega ATS (“Omega”). In late February
2009, IIROC Staff again raised this issue, noting that there had not been any significant
improvement. While having thereafter connected to Chi-X, BMONB did not sign a subscription
agreement with Omega until October 14, 2009. Despite the requirement of Rule 5.2, BMONB reliedon three factors which are not considerations under Policy 5.2 in determining when it would connect
to Omega: (i) Omega’s launch process; (ii) technological challenges in connecting to Omega; and(iii) Omega’s liquidity levels. BMONB also relied on availability of Omega’s market data as aconsideration relevant to connection.
Disposition – A Participant has an obligation to execute against better-priced orders on protectedmarketplaces before executing at an inferior price on any marketplace or foreign organizedregulatory market. Under the terms of a Settlement Agreement, BMONB admitted that between
October 2008 and October 2009, it breached UMIR when it failed to make reasonable efforts tomeet its best price obligations by connecting to all available “protected marketplaces” and, inparticular, Omega ATS, an alternative trading system for Canadian exchange listed equities.
Requirements Considered – Rule 5.2 and Policy 5.2.
Sanction - BMONB agreed to a $250,000 fine and $15,000 in costs.

Disciplinary Proceedings:

In the Matter of Beacon Securities Limited. (“Beacon”) (April 8, 2011) DN 11-0120
Facts – From December 2008 to November 2010, Beacon traded on the TSX through a third party
trading platform and jitneyed all TSX-Venture trades. Beacon did not, however, directly connect tothe remaining protected marketplaces although Beacon always had access to all protected

Part 5 – Best Execution Obligation
February 1, 2011

UMIR 5.2-2

marketplaces via its ongoing jitney relationship, but this had never been used in practice prior to
April, 2010 for institutional clients. Following a trade desk review in August 2009, IIROC noted that
Beacon was connected to the TSX and TSX-Venture, but was not directly connected to the otherprotected markets and deficiencies were found in Beacon’s written policies and procedures toensure “trade throughs” did not occur. In March 2010, Beacon updated its policies and procedures
regarding trading supervision. In October 2010, IIROC advised Beacon that between November,2008 to April 2010, Beacon generated 899 trade through alerts which could indicate violations andthat random sampling showed certain trade through violations. In November, 2010, Beacon
upgraded its trading platform to include the Smart Order Router to become directly connected to theremaining protected marketplaces for its institutional transactional activity.
Disposition – Pursuant to a Settlement Agreement, Beacon admitted that between December 2008
until November 2010, the firm failed to make reasonable efforts to ensure that orders were executedat the best price, contrary to UMIR 5.2 and UMIR Policy 5.2; and from December 2008 until March
2010, the firm failed to have adequate policies and procedures in place in order to ensure
reasonable efforts were made to execute orders at the best price, contrary to UMIR 7.1.
Requirements Considered – Rule 5.2, 7.1 and Policy 5.2, and 7.1.
Sanction – Beacon agreed to pay a fine of $70,000 costs in the amount of $5,000.
Disciplinary Proceedings:

In the Matter of Maison Placements Canada Inc. (“MPCI”) (April 13, 2011) DN 11-0124
Facts – Between December 2008 and January 2011 (the “relevant period”), MPCI was notconnected to all of the six protected marketplaces, but only to the TSX and TSXV. MPCI did not use
an acceptable order router nor did it did not provide the order to another Participant for entry on amarketplace. As a result, MPCI did not consider orders on any of the protected marketplaces otherthan the TSX or TSXV. During the period October 2007 to March 2008, MPCI informed its clientsthat it would execute trades on the TSX or TSXV only. During the period between December, 2008
and October, 2010, MPCI generated trade through alerts; however the percentage of trade throughalerts generated was small relative to MPCI’s overall trading volume. During the relevant period,
MPCI did not monitor or review its order flow for compliance with the “best price” obligation and did
not set out the steps or process to be followed to make “reasonable efforts” to ensure that orders
receive the “best price” when executed on a marketplace.
Disposition – Pursuant to a Settlement Agreement, MPCI admitted that it breached UMIR 5.2 andUMIR Policy 5.2 as it did not make reasonable efforts during the relevant period to ensure orders
were executed at the “best price.” UMIR Requirements make it clear that despite client consent or
instruction a Participant cannot trade-through a better bid or offer on a protected marketplace bymaking a trade at an inferior price. In addition, MPCI failed to have adequate policies andprocedures in place to ensure compliance with its “best price” obligation, contrary to UMIR 7.1 and
UMIR Policy 7.1.
Requirements Considered – Rule 5.2, 7.1 and Policy 5.2, and 7.1.
Sanction – MPCI agreed to pay a fine of $95,000 and costs in the amount of $5,000.

Disciplinary Proceedings:

In the Matter of Pope & Company Limited (“Pope”) (March 14, 2012) DN 12-0095
Facts – Between December 2008 and January, 2011, (the “Relevant Period”) Pope, an institutional
investment firm, was not connected to all protected marketplaces, only to the Toronto Stock
Exchange (TSX) and TSX Venture Exchange (TSXV). In addition, Pope did not use an acceptableorder router or provide the order to another Participant for entry on a marketplace. As a result, Pope
did not consider orders on any of the protected marketplaces other than the TSX or TSXV in respectof the “best price” obligation. Pope judged that the costs of subscribing to all protectedmarketplaces was too high and that it was not feasible to provide its orders to another Participant forentry on a marketplace as this would result in a transaction costs it believed its clients would findunacceptable. Pope ultimately subscribed to the TSX Smart Order Router and entered a jitney
service agreement to route orders to the firm’s jitney provider if the best price was available on amarketplace where the firm was not subscribed. During the Relevant Period, “trade-through” alerts
were generated by Pope but they were a small percentage relative to its overall trading volume.
Disposition – Pursuant to a Settlement Agreement, Pope admitted that in the Relevant Period it
failed to make reasonable efforts to ensure that orders were executed at the best price, contrary to
UMIR 5.2 and UMIR Policy 5.2 and failed to have adequate policies and procedures in place toensure reasonable efforts were made to execute orders at the best price, contrary to UMIR 7.1 andPolicy 7.1.
Requirements Considered – Rule 5.2, 7.1 and Policy 5.2, 7.1.
Sanction – Pope agreed to pay a fine of $30,000 and to pay costs in the amount of $5,000.

Part 5 – Best Execution Obligation
February 1, 2011

UMIR 5.2-3

Universal Market Integrity Rules

Rules & Policies

5.3

Client Priority
(1)

(2)

A Participant shall not enter on a marketplace or an organized regulated market aprincipal order or a non-client order of the Participant that, based on theinformation known or reasonably available to the person or persons originating or
entering the principal order or non-client order, the Participant knows or shouldhave known will execute or have a reasonable likelihood of executing in priority toa client order received by the Participant prior to the entry of the principal order or
non-client order for the same security that is:(a)at the same price or a lower price than the client order in the case of apurchase or the same or a higher price than the client order in the case of asale; and(b)on the same side of the market.

Despite subsection (1) but subject to Rule 4.1, a Participant is not required to givepriority to a client order if:(a)the client specifically has consented to the Participant entering principal
orders and non-client orders for the same security at the same price on thesame side of the market on the same settlement terms;(b)

the principal order or non-client order is:(i)

automatically generated by the trading system of a marketplace inrespect of the Marketplace Trading Obligations of that marketplace,(ii)

automatically generated by a system operated by the Participant or on
behalf of the Participant based on pre-determined order and tradingparameters established, programmed and enabled for trading prior to
the receipt of the client order,(iii)

for a managed account and the client order is for a managed accountunder the direction of the same person and in respect of which
executions are allocated between the various managed accounts on an
equitable basis in accordance with the established practices of theParticipant, or(iv)

a Basis Order;(c)

the client order has been entered directly by the client of the Participant on amarketplace;(d)the principal order or non-client order is executed pursuant to an allocation by
the trading system of a marketplace and:(i)either:(A)

Part 5 – Best Execution Obligation
July 27, 2023

the security which is the subject of the order trades on nomarketplace other than that marketplace,

UMIR 5.3-1

(3)

(B)

the principal order or non-client order is a Call Market Order, an
Opening Order, a Market-on-Close Order or a Volume-Weighted
Average Price Order,(C)each of the client order and the principal order or non-client order
was entered on the same marketplace,(D)the client has instructed the Participant to enter the client order ona particular marketplace, or(E)

the client has instructed the Participant to enter the client order ina manner that does not disclose the identifier of the Participant in
a consolidated market display,(ii)

the client order was entered by the Participant on that marketplace
immediately upon receipt by the Participant, and(iii)

if the client order was varied or changed by the Participant at any timeafter entry, the variation or change was on the specific instructions of
the client;(e)either the client order or the principal order or non-client order is a Special
Terms Order and the client order would not have executed in the transaction
or transactions involving the principal order or non-client order due to theterms and conditions of at least one Special Terms Order; or(f)a Market Integrity Official requires or permits the principal order or non-client
order to be executed in priority to a client order.

For the purposes of clause (2)(a), a client shall be deemed to have consented to
the Participant entering principal orders and non-client orders for the same security
at the same price on the same side of the market on the same conditions andsettlement terms if the client order, in accordance with the specific instructions of
the client, is to be executed in part at various times during the trading day or atvarious prices during the trading day.

POLICY 5.3 – CLIENT PRIORITY
Part 1 – Background
Rule 5.3 restricts a Participant and its employees from trading in the same securities as a clientof the Participant. The restriction is designed to minimize the conflict of interest that occurs
when a Participant or its employee compete with the firm’s clients for execution of orders. The
Rule governs:•

trading ahead of a client order, which is taking out a bid or offering that the client
could have obtained had the client order been entered first. By trading ahead, thepro order obtains a better price at the expense of the client order.

•

trading along with a client, or competing for fills at the same price.

The application of the rule can be quite complex given the diversity of professional trading
operations in many firms, which can include such activities as block facilitation, market making,derivative and arbitrage trading. In addition, firms may withhold particular client orders in orderPart 5 – Best Execution Obligation
July 27, 2023

UMIR 5.3-2

to obtain for the client a better execution than the client would have received if the order had
been entered directly on a marketplace. Each firm must analyze its own operations, identify risk
areas and adopt compliance procedures tailored to its particular situation.
A Participant has overriding agency responsibilities to its clients and cannot use
technical compliance with the rule to establish fulfillment of its obligations if theParticipant has not otherwise acted reasonably and diligently to obtain best execution of
its client orders.

Part 2 – Prohibition on Intentional Trading Ahead
A Participant can never intentionally trade ahead of a client order that is either a market order ortradeable limit order received prior to the entry of the principal order or non-client order except inaccordance with an exemption from the requirements of Rule 5.3(1), which exemptions include
obtaining the specific consent of the client. Examples of "intentional trades” include, but are notlimited to:•withholding a client order from entry on a marketplace (or removing an order alreadyentered on a marketplace) to permit the entry of a competing principal order or nonclient order ahead of the client order;•

entering a client order on a relatively illiquid market (other than on the instructions of
the client) and entering a principal order or non-client order on a more liquidmarketplace where the principal order or non-client order is likely to obtain faster
execution;•

adding terms or conditions to a client order (other than on the instructions of theclient) so that the client order ranks behind principal orders or non-client orders atthat price;•putting terms or conditions on a principal order or non-client order for the purpose ofdifferentiating the principal order or non-client order from a client order that would
otherwise have priority at that price; and•entering a principal order or non-client order as an “anonymous order” (without theidentifier of the Participant) which results in an execution in priority to a previously
entered client order that discloses the identifier of the Participant.

Part 3 – No Knowledge of Client Order
The Participant must have reasonable procedures in place to ensure that information
concerning client orders is not used improperly within the firm. These procedures will vary fromfirm to firm and no one procedure will work for all firms. If a firm does not have reasonable
procedures in place, it cannot rely on the exceptions. Reference should be made to Policy 7.1 –Policy on Trading Supervision Obligations, and in particular Part 4 – Specific Procedures
Respecting Client Priority.
If a client has instructed a Participant to withhold an order or has granted a Participant discretion
with respect to the entry of an order, details of the instruction or grant of discretion must be
retained for a period of seven years from the date of the instruction or grant of discretion and,for the first two years, the consent must be kept in a readily accessible location.

Part 5 – Best Execution Obligation
July 27, 2023

UMIR 5.3-3

Part 4 – Client Consent
A Participant does not have to provide priority to a client order if the client specifically consents
to the Participant trading alongside or ahead of the client. The consent of the client must be
specific to a particular order and details of the agreement with the client must be noted on theorder ticket. A client cannot give a blanket form of consent to permit the Participant to trade
alongside or ahead of any future orders the client may give the Participant.
If the client order is part of a pre-arranged trade that is to be completed at a price below the best
bid price or above the best ask price as indicated on a consolidated market display, theParticipant will be under an obligation to ensure that “better-priced” orders on a protectedmarketplace are filled prior to the execution of the client order. Prior to executing the client
order, the Participant must ensure that the client is aware of the better-priced orders and has
consented to the Participant executing as against them in priority to the client order. The
consent of the client must be noted on the order ticket.
If the client has given the Participant an order that is to be executed at various times during a
trading day (e.g. an “over-the-day” order) or at various prices (e.g. at various prices in order toapproximate a volume-weighted average price), the client is deemed to have consented to theentry of principal orders and non-client orders that may trade ahead of the balance of the client
order. Unless the client has provided standing written instructions that all orders are to be
executed at various times during the trading day or at various prices during the trading day, theclient instructions should be treated as specific to a particular order and the details of the
instructions by the client must be noted on the order ticket. However, if the un-entered portion of
the client order would reasonably be expected to affect the market price of the security, theParticipant may be precluded from entering principal orders or non-client orders as a result of
the application of the frontrunning rule.
In certain circumstances, a client may provide a conditional consent for the Participant to trade
alongside or ahead of the client order. For example, a client may consent to a principal order ofParticipant sharing fills with the client order provided the client order is fully executed by the endof the trading day. If the client's order is not fully executed, the client may expect that theParticipant "give up" its fills to the extent necessary to complete the client order. In this situation,
the Participant should mark its orders as "principal" throughout the day. Any part of theexecution which is given up to the client should not be re-crossed on a marketplace but should
simply be journalled to the client (since the condition of the consent has not been met, the fills inquestion could be viewed as properly belonging to the client rather than the principal order). To
the extent that a Participant "gives up" part of a fill of a principal order to a client based on theconditional consent, the Participant shall report the particulars of the "give up" to the Market
Regulator not later than the opening of trading on marketplaces on the next trading day. The
conditional consent of the client must be specific to a particular order. The details of theagreement with the client must be noted on the order ticket.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “best ask price”, “best bid price”, “Basis Order”, “Call Market Order”, “client order”,“consolidated market display”, “employee”, “Exchange”, “limit order”, “Market Integrity Official”, “Marketon-Close Order”, “market order”, “Market Regulator”, “marketplace”, “Marketplace Rules”, “Marketplace
Trading Obligations”, “non-client order”, “Opening Order”, “Participant”, “pre-arranged trade”, “principal

Part 5 – Best Execution Obligation
July 27, 2023

UMIR 5.3-4

order”, “QTRS”, “Special Terms Order”, “trading day” and “Volume-Weighted Average Price Order”
UMIR section 1.2(2) – “trade”
Related Provisions:

UMIR section 4.1 and Policy 7.1

Regulatory History:
Effective October 31, 2003, the applicable securities commissions approved an amendment toaccommodate anonymous orders. See Market Integrity Notice 2003-024 – “Accommodation ofAnonymous Orders” (October 31, 2003).
Effective May 26, 2006, the applicable securities commissions approved amendments to repeal andreplace Rule 5.3 and Policy 5.3. See Market Integrity Notice 2006-012 – “Provisions Respecting
Client Priority” (May 26, 2006).
Effective March 9, 2007, the applicable securities commissions approved an amendment to repeal andreplace Rule 5.3 and to repeal and replace Parts 2 and 3 of Policy 5.3. See Market Integrity Notice
2007-002 – “Provisions Respecting Competitive Marketplaces” (February 26, 2007).
Effective August 26, 2011, the applicable securities commissions approved an amendment to Rule5.3(2) to replace the reference to “Market Maker Obligations” with “Marketplace Tracking Obligations”.
See IIROC Notice 11-0251 – “Provisions Respecting Market Maker, Odd Lot and Other
Marketplace Trading Obligations”(August 26, 2011).
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French version of
UMIR” (December 9, 2013).
Effective September 18, 2015, the applicable securities commissions approved an amendment to Part 4of Policy 5.3. See IIROC Notice 15-0211 - Notice of Approval – “Provisions Respecting UnprotectedTransparent Marketplaces and the Order Protection Rule” (September 18, 2015).
Effective January 2, 2018, the applicable securities commissions approved an amendment to Part 3 ofPolicy 5.3. See IIROC Notice 17-0137 – “Amendments Respecting Best Execution” (July 6, 2017).
Effective July 27, 2023, the applicable securities commissions approved housekeeping amendments to
UMIR to correct inaccurate referencing and typographical mistakes and to ensure consistency between
the English and French versions of UMIR. See CIRO Bulletin 23-0107 - "Housekeeping Amendments
to UMIR" (July 27, 2023).
Repealed Guidance:

See Market Integrity Notice 2005-023 – “Securities Trading on Multiple Marketplaces” (July 29,2005). This Notice was repealed by Market integrity Notice 2006-017 – “Securities Trading on
Multiple Marketplaces” (September 1, 2006).

Partially Repealed Guidance: See Market Integrity Notice 2006-017– “Guidance – Securities Trading on Multiple
Marketplaces” (September 1, 2006). Sections of this Market Integrity Notice relating to UMIR
5.2 were repealed by Market Integrity Notice 2008-010 – Guidance – “Complying with “Best
Price” Obligations” (May 16, 2008). Section respecting Rule 5.1 – Best Execution of Client
Orders of MIN 2006-017 was repealed and replaced effective January 2, 2018 by IIROC Notice
17-0138 – “Guidance on Best Execution” (July 6, 2017).
Partially Repealed Guidance: See Market Integrity Notice 2007-019 – “Entering Client Orders on Non-Transparent
Marketplaces and Facilities” (September 21, 2007). Questions 2 and 6 of MIN 2007-019 wererepealed and replaced effective January 2, 2018 by IIROC Notice 17-0138 – “Guidance on
Best Execution” (July 6, 2017).
Disciplinary Proceedings:

In the Matter of Desjardins Securities Inc. (“Desjardins”), Jean-Pierre De Montigny (DeMontigny”) and Jean-Luc Brunet (“Brunet”) (March 16, 2005) SA 2005-002
Facts – RS Trade Desk Reviews (“TDRs”) in November 2002 and October 2003 highlighted
insufficient supervision of trading practices and procedures and other UMIR deficiencies related toaudit trail violations. In a subsequent TDR in 2004, it was found that the deficiencies noted in 2002
and 2003 were not corrected, and in many instances were more extensive. In addition to thesefailings, RS’s investigation also noted 17 instances of the Desjardins trading along side a client,
without recording the requisite client consent for each order.
Disposition – By failing to address the various deficiencies noted by the TRD team, and failing to
implement an effective trading supervision system, the Participant, De Montigny and Brunet failed toestablish an effective compliance and trading supervision system for the firm’s trading operation,
contrary to their respective obligations under UMIR.
Requirements Considered – Rules 5.3(6), 10.11, 7.1 and Policy 7.1
Sanction –Desjardins Securities Inc. –Part 5 – Best Execution Obligation
July 27, 2023

$1,500,000 fine and costs of $125,000; Board of Directors

UMIR 5.3-5

certification that trading compliance and supervision systems are compliant with UMIR;
Jean-Pierre De Montigny –$300,000 fine;Jean-Luc Brunet – $35,000 fine.
Disciplinary Proceedings:

Rule 5.3 was considered In the Matter of Kai Tolpinrud (“Tolpinrud”) (January 16, 2006) OOS
2004-001. See Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

Rule 5.3(6) was considered In the Matter of Salman Partners Inc. (“Salman”), Sameh Magid(“Magid”), William Burk (“Burk”) and Ian Todd (“Todd”) (February 18, 2005) SA 2005-001. See
Disciplinary Proceedings under Rule 3.1.

Disciplinary Proceedings:

In the Matter of Raymond James Ltd. (“Raymond James”) and Marc Deslongchamps(“Deslongchamps”) (June 30, 2006) DN 2006-006
Facts – In the period February 2003 to February 2005 Deslongchamps, the “Head Trader” forRaymond James, was responsible for supervising Raymond James’ institutional sales, proprietaryand facilitation traders across Canada. In addition to acting as Head Trader, Deslongchamps
conducted proprietary trading for one of Raymond James’ inventory accounts. During the relevant
period, trading by certain traders under the direction of Deslongchamps and trading by
Deslongchamps himself resulted in numerous client priority, audit trail and order marking violations.
RS identified instances in which Deslongchamps and traders under his supervision traded ahead ofor alongside clients without client consent, failed to properly record client consent in cases whereclient consent was obtained, failed to complete trade tickets with appropriate information andimproperly marked client trades “non-client”, all of which resulted in an incomplete audit trail.
In the period July 2003 to February 2005 Raymond James’ institutional trading supervision andcompliance systems were not reasonably designed to prevent the UMIR violations referenced
above. Also, the Manager of Compliance at Raymond James used a flawed methodology to test forpossible client priority issues. The flawed nature of the testing resulted in ongoing trade and audit
trail problems not being escalated.
Disposition – In failing to implement an institutional trading supervision and compliance system
which was reasonably designed to prevent and detect client priority, consent, order marking
requirements set out in UMIR and failing to take effective steps to ensure the Head Trader carriedout his trading supervision obligations, Raymond James failed to comply with its trading supervisionobligations under UMIR.
In failing to take effective steps to supervise the traders he oversaw to ensure compliance with client
priority and audit trail requirements Deslongchamps failed to comply with his trading supervisionobligations under UMIR.
Requirements Considered – Rules 5.3(1), 5.3(2), 5.3(6), 6.2(1)(b), 10.11(1), 7.1(1), 7.1(4) and
Policy 7.1.
Sanction –Raymond James – $400,000 fine and costs of $125,000;
Deslongchamps – $50,000 fine; prohibition against acting in a supervisory capacity for 1 year.

Disciplinary Proceedings:

In the Matter of Bert Griffin (“Griffin”) (August 31, 2009) DN 09-0245
Facts –On January 27, April 11, and 21, 2006, Griffin failed to give priority to client orders over nonclient orders in the same security and on the same side of the market. Griffin’s improper order
handling resulted in a financial disadvantage to certain clients and a disadvantage to other clients
who did not receive a fill that may have otherwise been obtained in the absence of Griffin’s nonclient orders.
Disposition – Absent specific client consent to the Participant trading ahead or alongside an order,
client priority must be respected in order to minimize the conflict of interest that occurs when a firmor trader competes with the firm’s clients for executions. Under the terms of a Settlement
Agreement, Griffin agreed that he did not record that any client had specifically consented to his
trading ahead or alongside on any of the order tickets, as required by UMIR 5.3(6), nor did he makeany other record of any of the clients providing their consent. Griffin contravened the client priority
rule on multiple occasions by filling orders for his own account that his clients could have obtained
had the client orders been entered first.
Requirements Considered – Rule 5.3 and Policy 5.3.
Sanction - Griffin agreed to a $15,000 fine, $5,000 in costs and to successfully complete both theConduct and Practices Handbook and Trader Training Course examinations within six (6) months.

Part 5 – Best Execution Obligation
July 27, 2023

UMIR 5.3-6

Universal Market Integrity Rules

Rules & Policies

PART 6 – ORDER ENTRY AND EXPOSURE
6.1

Entry of Orders to a Marketplace(1)

No order to purchase or sell a security shall be entered to trade on a marketplace
at a price that includes a fraction or a part of a cent other than an increment of onehalf of one cent in respect of an order with a price of less than $0.50.

(2)Each order to purchase or sell a listed security or a quoted security entered to
trade on a marketplace shall be subject to any special rule or direction issued by
the Exchange on which the security is listed or by the QTRS on which the security
is quoted with respect to:(a)clearing and settlement; and(b)entitlement of the purchaser to receive a dividend, interest or any other
distribution made or right given to holders of that security.

(3)

Notwithstanding subsection (1), an intentional cross may be entered on amarketplace at a price which is a fraction of a trading increment provided theexecution price is a better price for both the order to purchase and the order to sell.

(4)

A Participant acting as principal or an Access Person shall not enter an order on amarketplace for a particular security that would, if executed, be a short sale if theParticipant or Access Person has previously executed a sale in that security that
became a failed trade in respect of which notice to the Market Regulator was
required pursuant to Rule 7.10 unless:(a)the Participant or Access Person has made arrangements for the borrowingof the securities necessary to settle any resulting trade prior to the entry of
the order; or(b)

the Market Regulator has consented to the entry of such order or orders.

(5)

A Participant or an Access Person shall not enter an order on a marketplace for a
Pre-Borrow Security that would, if executed, be a short sale unless the Participantor Access Person has made arrangements for the borrowing of the securities
necessary to settle any resulting trade prior to the entry of the order.

(6)

A Participant acting as agent shall not enter a client order or a non-client order on amarketplace that would, if executed, be a short sale if the client or non-client has
previously executed a sale of any listed security that became a failed trade in
respect of which notice to the Market Regulator was required pursuant to Rule 7.10
unless:Part 6 - Order Entry and Exposure
September 15, 2017

UMIR 6.1-1

(7)

(8)

(9)

(a)

the Participant has made arrangements for the borrowing of the securities
necessary to settle any resulting trade prior to the entry of the order; or(b)

the Participant is satisfied, after reasonable inquiry, that the reason for any
prior failed trade was not as a result of any intentional or negligent act of theclient or non-client.

A Participant shall not enter an order on a marketplace or permit an order to betransmitted to a marketplace containing the identifier of the Participant unless theorder has been:(a)received, processed and entered on the marketplace by an employee of theParticipant who is registered in accordance with applicable securities
legislation to perform such functions; or(b)

has been entered on a marketplace or transmitted to a marketplace through:(i)

direct electronic access,(ii)

a routing arrangement, or(iii)

an order execution service.

An Access Person shall not enter an order on a marketplace or permit an order tobe transmitted to a marketplace containing the identifier of the Access Person
unless the order is:(a)for the account of the Access Person and not for any other person; or(b)entered by an Access Person who is registered or exempted from registration
as an adviser in accordance with applicable securities legislation and theorder is for or on behalf of a client of the Access Person acting in the capacityof adviser for that client and not for any other person.

A marketplace shall not allow an order to be entered on the marketplace unless:
(a)

(b)

the order:(i)

has been entered by or transmitted through a Participant or Access
Person who has access to trading on that marketplace, and(ii)

contains the identifier of the Participant or Access Person as assignedin accordance with Rule 10.15; orthe order has been generated automatically by the marketplace on behalf of aperson who has Marketplace Trading Obligations in order for that person tomeet their Marketplace Trading Obligations.

POLICY 6.1 – ENTRY OF ORDERS TO A MARKETPLACE
Part 1 – Execution Price of Orders
An order may execute at such price increment as established by the marketplace for the
execution of such orders and the marketplace shall report the execution price to the information
processor and information vendor provided, if required by the information processor orinformation vendor, the marketplace shall report the price at which the trade was executed as
the nearest trading increment and if the price results in one-half of a trading increment the priceshall be rounded up to the next trading increment.

Part 6 - Order Entry and Exposure
September 15, 2017

UMIR 6.1-2

Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
NI 21-101 section 1.1 – “information processor” and “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “better price”, “client order”, ”direct electronic access”,“Exchange”, “failed trade”, “intentional cross”, “listed security”, “Market Regulator”, “marketplace”,“Marketplace Trading Obligations”, “non-client order”, “order execution service”, “Participant”, “PreBorrow Security”, “QTRS”, “quoted security”, “routing arrangement”, “short sale” and “trading increment”
UMIR section 1.2(2) – “trade”

Related Provision:

UMIR section 10.15

Regulatory History:

Effective March 9, 2007, the applicable securities commissions approved an amendment to subsection(1) of Rule 6.1 to add the phrase “in respect of an order with a price of less than $0.50” at the end of thesubsection and to add Part 1 of Policy 6.1. See Market Integrity Notice 2007-002 – “Provisions
Respecting Competitive Marketplaces” (February 26, 2007).
On March 2, 2012, the applicable securities commissions approved an amendment to section 6.1,
effective October 15, 2012, to add a new subsection (3). See IIROC Notice 12-0078 – “Provisions
Respecting Regulation of Short Sales and Failed Trades” (March 2, 2012). Effective March 1, 2014,
this subsection is renumbered subsection (6) and subsections (7)-(9) relating to third-party electronic
access to marketplaces are added. See IIROC Notice 13-0184 “Provisions Respecting Third-Party
Electronic Access to Marketplaces” (July 4, 2013).
On April 13, 2012, the applicable securities commissions approved amendments to section 6.1,
effective October 10, 2012, to add subsections (3), (4) and (5). See IIROC Notice 12-0130 –“Provisions Respecting Dark Liquidity” (April 13, 2012).
On April 13, 2012, the applicable securities commissions approved an amendment to Policy 6.1,
effective October 10, 2012, to repeal and replace Part 1. See IIROC Notice 12-0130 – “Provisions
Respecting Dark Liquidity” (April 13, 2012). Prior to that effective date, Part 1 provided:
Part 1 – Exceptions for Certain Types of Orders
Notwithstanding that all orders for a security at a price of $0.50 or more must be entered on amarketplace at a price that does not include a fraction or a part of a cent, an order which is enteredon a marketplace as a Basis Order, Call Market Order or a Volume-Weighted Average Price Ordermay execute at such price increment as established by the marketplace for the execution of suchorders provided, unless otherwise permitted by the information processor or information vendor, thatthe marketplace shall report the price at which the trade was executed to the information processor
or an information vendor as the nearest trading increment and if the price results in one-half of a
trading increment the price shall be rounded up to the next trading increment.
On July 4, 2013, the applicable securities commissions approved amendments to section 6.1, effective
March 1, 2014, to add subsections (7), (8) and (9) and to renumber former subsection 6.1(3) as 6.1(6).
See IIROC Notice 13-0184 - “Provisions Respecting Third-Party Electronic Access toMarketplaces” (July 4, 2013).

Guidance:

See question 4 in IIROC Notice 12-0295 - “Specific Questions Related To Dark Liquidity Rule
Amendments” (October 9, 2012).

Part 6 - Order Entry and Exposure
September 15, 2017

UMIR 6.1-3

Universal Market Integrity Rules

Rules & Policies

6.2

Designations and Identifiers(1)

Each order in a listed security entered on a marketplace shall contain:(a)the identifier of:
(i)

(ii)
(iii)
(iv)

(v)

(b)

the Participant or Access Person entering the order as assigned
to the Participant or Access Person in accordance with Rule10.15,
the marketplace on which the order is entered as assigned tothe marketplace in accordance with Rule 10.15,
the Participant for or on behalf of whom the order is entered, if
the order is a jitney order,
the client for or on behalf of whom the order is entered:
1. in the form of a Legal Entity Identifier for:A. orders entered using direct electronic accessB. orders entered using a routing arrangement
C. an identified order execution only client that is eligible
to receive a Legal Entity Identifier under the standards set
by the Global Legal Entity Identifier System
D. orders for accounts that are supervised under Part D of
Corporation Rule 3900 – Supervision of institutional client
accounts
2. in the form of an account number for all other client orders notincluded under UMIR 6.2(1)(a)(iv)(1)
the client of a foreign dealer equivalent for or on behalf of whom
the order is entered under a routing arrangement, where suchclient order is automatically generated on a predetermined basisby that client, and in the form and manner acceptable to theMarket Regulator; anda designation acceptable to the Market Regulator for the marketplace
on which the order is entered, if the order is:(i)a Call Market Order,(ii)

an Opening Order,(iii)

a Market-on-Close Order,(iv)

a Special Terms Order,(v)

a Volume-Weighted Average Price Order,(v.1)

a Basis Order,(v.2)

a Closing Price Order,(v.3)

a bypass order,(v.4)

a directed action order as defined in the Trading Rules,

Part 6 - Order Entry and Exposure
January 1, 2023

UMIR 6.2-1

(vi)part of a Program Trade,(vii)

part of an intentional cross or internal cross,(vii.1) a derivative-related cross,(viii)

a short sale but not including an order which is designated as a“short-marking exempt order” in accordance with subclause
6.2(1)(b)(ix),(ix)

a short-marking exempt order,(x)

a non-client order,(xi)

a principal order,(xii)

a jitney order,(xiii)

for the account of a derivatives market maker,(xiv)

for the account of a person who is an insider of the issuer of the
security which is the subject of the order,(xv)

for the account of a person who is a significant shareholder of theissuer of the security which is the subject of the order,(xvi)

for the account of a client where the order is sent using directelectronic access,(xvii)

for the account of a client where the order is sent under a routing
arrangement,(xviii) for the account of an order execution only client,

(c)

(2)

(xix)

of a type for which the Market Regulator may from time to timerequire a specific or particular designation,(xx)

a bundled order, or(xxi)

a multiple client order.

Where a designation is required under 6.2(1)(b)(xx) or (xxi), the Participant
does not need to include a client identifier on the order under 6.2(1)(a)(iv).

Each order in a listed derivative entered on an Exchange shall contain:(a) the identifier of:(i)the Participant or Access Person entering the order as assigned to theParticipant or Access Person in accordance with Rule 10.15,(ii)
the Exchange on which the order is entered as assigned to the
Exchange in accordance with Rule 10.15,(iii) the Participant for or on behalf of whom the order is entered, if the order isa jitney order,(iv) the client for or on behalf of whom the order is entered under directelectronic access, and(v) the investment dealer or foreign dealer equivalent for or on behalf of whom
the order is entered under a routing arrangement; and(b) a designation acceptable to the Market Regulator for the Exchange on which
the order is entered, if the order is:(i)a non-client order,

Part 6 - Order Entry and Exposure
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UMIR 6.2-2

(ii)
(iii)
(iv)

(3)

a principal order,
for the account of a derivatives market maker,
for the account of a person who is an insider of the issuer of theunderlying security which is the subject of the order,(v)
for the account of a person who is a significant shareholder of theissuer of the underlying security which is the subject of the order,(vi)
one that includes an opening or closing transaction indicator(vii)
of a type for which the Market Regulator may from time to time requirea specific or particular designation.
If the order entered on a marketplace is a Special Terms Order, the order shallcontain, in addition to all designations and identifiers required by subsection (1),information in such form as is acceptable to the Market Regulator of themarketplace on which the order is entered respecting:(a)any condition on the execution of the order; and(b)the settlement date.

(4)

If following the entry of an order on a marketplace for the sale of security that has
not been designated as a short sale such order would become a short sale on
execution, the order shall be modified to include the short sale designation
required by subsection (1).

(5)

Each order entered on a marketplace including all designations and identifiers
required by subsection (1) and (2) shall be disclosed to each Market Regulator.

(6)

The marketplace on which the order is entered shall determine if the identifier of
the Participant or the marketplace shall be displayed:(a) in a consolidated market display for a security,or(b) in a marketplace for a derivative.

(7)

Unless otherwise permitted or directed by the Market Regulator, a marketplace
shall:(a)disclose for display in a consolidated market display any designation
attached to an order that is required by sub-clause (i) to (vii.1) inclusive ofclause (1)(b), but for a bypass order that is not part of a designated trade,
and

(b)

not disclose for display in a consolidated market display any designation
attached to an order that is required by:(i) sub-clause (viii) to (xxi) inclusive of clause (1)(b)(ii) sub-clause (i) to (vii) inclusive of clause (2)(b).

Part 6 - Order Entry and Exposure
January 1, 2023

UMIR 6.2-3

Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
NI 23-101 section 1.1 – “directed-action order”
NI 31-103 section 1.1 – “investment dealer”
UMIR section 1.1 – “Access Person”, “Basis Order”, “bypass order”, “bundled order”, “Call Market
Order”, ”Closing Price Order”, “consolidated market display”, “derivative”, “derivatives market maker”,“derivative-related cross”, “direct electronic access”, “Exchange”, “foreign dealer equivalent”, “identified
order execution only client”, “Global Legal Entity Identifier System”, “insider”, “intentional cross”,“internal cross”, “jitney order”, “Legal Entity Identifier”, “listed derivative”, “listed security”, ”Market-onClose Order”, “Market Regulator”, “marketplace”, “multiple client order”, “non-client order”, “Opening
Order”, “Participant”, “principal order”, “Program Trade”, “routing arrangement”, “short-marking exempt
order”, “short sale”, “significant shareholder”, “Special Terms Order”, “Trading Rules” and “VolumeWeighted Average Price Order”
UMIR section 1.2 – “person”

Related Provision:

UMIR sections 7.13, 10.15

Regulatory History:

Effective April 8, 2005, the applicable securities commissions approved an amendment to require
marking of Basis Orders. See Market Integrity Notice 2005-010 – “Provisions Respecting a “Basis
Order”” (April 8, 2005).
Effective March 9, 2007, the applicable securities commissions approved an amendment to require
marking of a Closing Price Order. See Market Integrity Notice 2007-002 – “Provisions Respecting
Competitive Marketplaces” (February 26, 2007).
On May 16, 2008, the applicable securities commissions approved an amendment to require markingof a bypass order. The implementation date of this amendment was determined by the IIROC Board of
Directors to be June 1, 2009. See Market Integrity Notice 2008-008 – “Provisions Respecting “OffMarketplace” Trades” (May 16, 2008) and see IIROC Notice 09-0034 – “Implementation Date for
the Marking of Bypass Orders” (February 3, 2009).
Effective February 1, 2011, the applicable securities commissions approved an amendment to require
marking of a directed action order. See IIROC Notice 11-0036 – “Provisions Respecting the
Implementation of the Order Protection Rule” (January 28, 2011).
On April 13, 2012, the applicable securities commissions approved amendments to section 6.2,
effective October 15, 2012, to replace the short sale language (that referenced price restrictions) withshort sale and short-marking exempt order marker requirements. See IIROC Notice 12-0078 –“Provisions Respecting Regulation of Short Sales and Failed Trades” (March 2, 2012).
On July 4, 2013, the applicable securities commissions approved amendments to section 6.2, effective
March 1, 2014, to add identifier requirements for direct electronic access clients and routing
arrangements. See IIROC Notice 13-0184 – Provisions Respecting Third-Party Electronic Accessto Marketplaces issued July 4, 2013.
On November 13, 2014, the applicable securities commissions approved amendments to 6.2, effective
June 1, 2015, to require an identifier if the order requires an identifier under Dealer Member Rule
3200. See IIROC Notice 14-0263 – “Provisions Respecting Order Execution Services as a Formof Third-Party Electronic Access to Marketplaces” (November 13, 2014).
On February 3, 2017, the applicable securities commissions approved amendments to section 6.2,
effective September 14, 2017. See IIROC Notice 17-0039 – Notice of Approval – “Amendments
Respecting Designations and Identifiers” (February 16, 2017).
Effective July 26, 2021, the applicable securities commissions approved amendments to sections 1.1,
6.2, 7.13 and 10.15 to add identifier and/or designation requirements for clients on orders sent to amarketplace. See IIROC Notice 19-0071 – “Amendments Respecting Client Identifiers” (April 18,2019).
Effective December 31, 2021, the applicable securities commissions approved housekeeping
amendments to replace rule references to the Dealer Member Rules with provisions of the IIROC
Rules. See IIROC Notice 21-0236 - Rules Notice – Notice of Approval – UMIR – “Housekeeping
amendments to UMIR 6.2 to update reference to IIROC Rules” (December 16, 2021).
Effective December 14, 2022, the applicable securities commissions approved amendments to UMIR
6.2 to add designations and identifiers applicable to trading in a listed derivative. See IIROC Notice 220140– “Amendments Respecting the Trading of Derivatives on a Marketplace” (September 15,2022).

Part 6 - Order Entry and Exposure
January 1, 2023

UMIR 6.2-4

Guidance:

See Market Integrity Notice 2002-012 – “Regulation ID Order Markers and Order Inhibition During
Regulatory Halts & Suspensions” (July 9, 2012).

Guidance:

See Market Integrity Notice 2003-007 – “Order Marking” (March 27, 2003).

Repealed Guidance:

See Market Integrity Notice 2005-003 - “Marking Jitney Orders” (March 4, 2005). This Notice wasrepealed and replaced by IIROC Notice 13-0185 –“Guidance Respecting Third-Party Electronic
Access to Marketplaces” (July 4, 2013).

Repealed Guidance:

See Market Integrity Notice 2006-014 - “Insider” and “Significant Shareholder” Markers” (June16, 2000). This Notice was repealed and replaced by IIROC Notice 10-0121 – Guidance on ‘’Insider’’and ‘’Significant Shareholder’’ Markers (April 28, 2010).

Repealed Guidance:

See Market Integrity Notice 2007-004 - “Marking Orders Received from Other Dealers” (February
28, 2007). This Notice was repealed and replaced by IIROC Notice 13-0185 – “Guidance Respecting
Third-Party Electronic Access to Marketplaces” (July 4, 2013).

Repealed Guidance:

See Market Integrity Notice 2007-016 - “Specific Questions Related to “Insider” Marking
Requirements” (August 10, 2007). This Notice was repealed and replaced by IIROC Notice 10-0121– “Guidance on ‘’Insider’’ and ‘’Significant Shareholder’’ Markers” (April 28, 2010).

Repealed Guidance:

See IIROC Notice 08-0033 – “New Procedures for Order Marker Corrections” (July 15, 2008). This
Notice was repealed and replaced effective July 26, 2021 by IIROC Notice 21-0122 – “Marker
Corrections and Use of the Regulatory Marker Correction System” (July 12, 2021).

Repealed Guidance:

See IIROC Notice 08-0050 – “User Guide for the Regulatory Marker Correction Form” (July 30,2008). This Notice was repealed and replaced effective July 26, 2021 by IIROC Notice 21-0122 –“Marker Corrections and Use of the Regulatory Marker Correction System” (July 12, 2021).

Guidance:

See IIROC Notice 09-0128 – “Specific Questions Related To The Use of The Bypass Order
Marker” (May 1, 2009).

Guidance:

See IIROC Notice 10-0121 – “Guidance on ‘’Insider’’ and ‘’Significant Shareholder’’ Markers’’(April 28, 2010).

Guidance:

See IIROC Notice 12-0295 – “Specific Questions Related To Dark Liquidity Rule Amendments"(October 9, 2012).

Repealed Guidance:

See IIROC Notice 12-0300 – “Guidance on “Short Sale“ and “Short-Marking Exempt“ Order
Designations” (October 11, 2012). This Notice was repealed and replaced effective April 11, 2016 by
IIROC Notice 16-0029 – “Updated Guidance on “Short Sale” and “Short-Marking Exempt” Order
Designations” (February 11, 2016).

Guidance:

See IIROC Notice 13-0053 – “Guidance on Certain Manipulative and Deceptive Trading
Practices” (February 14, 2013).

Guidance:

See IIROC Notice 13-0185 – “Guidance Regarding Third-Party Electronic Access toMarketplaces” (July 4, 2013).

Partially Repealed Guidance: See Notice 14-0264 - “Guidance Respecting Order Execution only as a Form of Third-Party
Electronic Access to Marketplaces” (November 13, 2014). Item 4 in reference to client
account numbers in ACCOUNT_ID field of each order and Question 1 in Item 5 of this Noticewere partially repealed and replaced effective July 26, 2021 by IIROC Notice 21-0099 – “Use of
Identifiers and Notification Requirements Respecting Certain Order Execution Only andDirect Electronic Access Clients and Advisers” (May 25, 2021).
Guidance:

See IIROC Notice 15-0135 – “Alternative Guidance on “Insider” Order Marking” (June 24, 2015).

Guidance:

See IIROC Notice 16-0029 – “Updated Guidance on “Short Sale” and “Short-Marking Exempt”
Order Designations” (February 11, 2016).

Repealed Guidance:

See IIROC Notice 19-0133 – “Use of Identifiers and Notification Requirements Respecting
Certain Order Execution Only Client Accounts” (August 6, 2019). This Notice was repealed andreplaced effective July 26, 2021 by IIROC Notice 21-0099 – “Use of Identifiers and Notification
Requirements Respecting Certain Order Execution Only and Direct Electronic Access Clientsand Advisers” (May 25, 2021).

Guidance:

See IIROC Notice 21-0099 – “Use of Identifiers and Notification Requirements Respecting
Certain Order Execution Only and Direct Electronic Access Clients and Advisers” (May 25,2021).

Guidance:

See IIROC Notice 21-0122 – “Marker Corrections and Use of the Regulatory Marker Correction
System” (July 12, 2021).

Disciplinary Proceedings:

Rule 6.2(1)(b)(viii) and (x) was considered In the Matter of Salman Partners Inc. (“Salman”),
Sameh Magid (“Magid”), William Burk (“Burk”) and Ian Todd (“Todd”) (February 18, 2005)
SA 2005-001. See Disciplinary Proceedings under Rule 3.1.

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UMIR 6.2-5

Disciplinary Proceedings:

In the Matter of Union Securities Ltd. (“Union”) (April 18, 2006) DN 2006-004
Facts – Between 15 October 2002 and 31 July 2005, Union failed to implement adequate tradesupervision and compliance systems and appoint a Head of Trading with the effective
responsibility for supervising trading. In failing to do so, Union’s supervisory system could notadequately mitigate certain risks to the marketplace which were identified by RS in the course of
its trade desk reviews. In particular, Union failed to update its written policies and procedures in atimely fashion to ensure that orders entered on a marketplace contained acceptable order
designations, failed conduct accurate internal auditing and maintain an appropriate audit trail in its
paper ticket practices.
Disposition – A Participant is required to implement an updated trade supervision and compliancesystem which is appropriate for its business and which allows the Participant and its directors,
officers, partners and employees to detect, prevent and address violations or a possible violationsof UMIR. Union failed to adopt, implement and update its trading supervision and compliancepolicies and procedures such that they met the minimum requirements under UMIR.
Requirements Considered – Rules 6.2, 10.11, 7.1 and Policy 7.1
Sanction – $150,000 fine; certification to RS by Union’s President and a director of Union (onbehalf of the Board of Directors) that:a)on or before 30 May 2006 Union will implement all of the recommendations made in theConsultant Report,b)on or before 30 July 2006 Union has implemented all of the recommendations made in
the Consultancy Report, including developing implementing, and filing with RS, enhanced
supervision and compliance procedures to reduce incidence of audit trail deficiencies, andc)on or before 30 September 2006, that they expect the procedures Union has implemented
will reduce audit trail deficiency rates to less than 10%.

Also, Union will consent to and cooperate with any and all reasonable trade desk review andinformation requests from RS to monitor progress on achieving targets.
Disciplinary Proceedings:

Rule 6.2(1)(b) was considered In the Matter of Raymond James Ltd. (“Raymond James”) andMarc Deslongchamps (“Deslongchamps”) (June 30, 2006) DN 2006-006. See Disciplinary
Proceedings under Rule 5.3

Disciplinary Proceedings:

In the Matter of Golden Capital Securities Ltd. (“Golden”), Jack Finkelstein (“Finkelstein”)
and Jeff Rutledge (“Rutledge”) (November 23, 2007) DN 2007-004
Facts – Between April 1, 2002 and July 31, 2005, Golden was deficient in a number of its order
designation and audit trail requirements. Golden also failed to appoint a Head of Trading andtrading supervisor and failed to ensure its employees with trade supervision functions were
properly trained.
Between June 2004 and March 2005, Finkelstein participated in several trades that involved
matching buy and sell orders to “cross” securities that were either missing or contained inaccurateorder information related to the size, price, time of receipt and/or variations to an order. In one
case Finkelstein failed to correctly designate the inventory side of a client/principal cross involving
50 standard trading units or less which resulted in the cross being executed without the required
price improvement to the client.
Between June 2004 and March 2005, Rutledge participated in several trades involving matching
buy and sell orders to “cross” securities that were either missing or contained inaccurate orderinformation related to the size, price, time of receipt and/or variations to an order. In one case
Rutledge failed to correctly designate the inventory side of a client/principal cross involving 50
standard trading units or less which resulted in the cross being executed without the required priceimprovement to the client.
Disposition – By failing to ensure that each order entered on a marketplace contained the properorder designations and failing to implement adequate policies and procedures to ensurecompliance with UMIR, Golden contravened Rule 6.2(1)(b), Rule 7.1, Rule 7.1(3) and Policy 7.1 of
UMIR. Finkelstein and Rutledge, by failing to record all order designations and information
required with respect to the entry of an order on a marketplace and failing to ensure that a client
order executed against a principal order or non-client order receive the required price improvement
breached Rules 6.2, 6.2(1)(b) and 8.1 of UMIR.
Requirements Considered – Rules 6.2, 7.1, 8.1, 10.11 and Policy 7.1
Sanction –Golden - $180,000 fine and costs of $20,000;
Finkelstein - $25,000 fine; andRutledge - $35,000 fine and costs of $5,000.

Part 6 - Order Entry and Exposure
January 1, 2023

UMIR 6.2-6

Disciplinary Proceedings:

In the Matter of Vinh-Phat Nguyen-Qui (“Nguyen-Qui”) (October 11, 2012) DN 12-0298
Facts – Between October and December 2009 (the “Relevant Period”), Nguyen-Qui, a Registered
Representative employed by W.D. Latimer Co. Limited, entered buy and sell orders on the TSX in
the pre-opening market and cancelled them prior to market opening for the sole objective of
acquiring a better chronological position once the market opened. Nguyen-Qui also entered shortsale orders in the pre-opening market without designating them as short sales and/or at a pricebelow the last sale price as indicated in the consolidated market display.
Disposition – In the Relevant Period, Nguyen-Qui entered orders he knew or ought to reasonably
have known would create or could reasonably be expected to create, a false or misleading
appearance of trading activity or interest in the purchase or sale of the security, contrary to UMIR
2.2(2)(a); entered short sale orders in the pre-opening market without proper designation contrary
to UMIR 6.2(1)(b)(viii); and entered short sale orders in the pre-opening market below the last saleprice, contrary to UMIR 3.1(1).
Requirements Considered – Rule 2.2(2)(a), 3.1(1) and 6.2(1)(b)(viii).
Sanction – The Hearing Panel imposed a prohibition on Nguyen-Qui from accessing the market as
a Registered Representative for a period of two months and a fine of $10,000 for the first violation
plus fines of $5,000 for each of the two additional violations; Nguyen-Qui was also required to takethe Trader Training Course again and pay costs in the amount of $10,000.

Disciplinary Proceedings:

In the Matter of RBC Dominion Securities (“RBC”) (July 20, 2022), 2022 IIROC 19
Facts – Between August 2017 and October 2021 (the “Relevant Period”), the Respondent did notinclude proper order designations on numerous orders entered on an IIROC-regulated
marketplace as required by UMIR 6.2(1)(b). The incorrectly designated orders were self-reported
to IIROC and the various underlying causes have been remedied by the Respondent; and during
the Relevant Period, the Respondent’s internal surveillance and trade supervision in respect of
the subject orders was based on erroneous underlying data as was IIROC’s ability to effectively
perform its market oversight responsibilities in connection with them.
Disposition and Sanction – Pursuant to a Settlement Agreement, RBC admitted that it
contravened UMIR 6.2(1)(b). RBC agreed to pay a fine of $140,000 and costs of $22,500.
Requirements Considered – Rule 6.2(1)(b)Part 6 - Order Entry and Exposure
January 1, 2023

UMIR 6.2-7

Universal Market Integrity Rules

Rules & Policies

6.3

Exposure of Client Orders(1)

A Participant shall immediately enter for display on a marketplace that displays
orders in accordance with Part 7 of the Marketplace Operation Instrument a client
order to purchase or sell 50 standard trading units or less of a security unless:(a)the client has specifically instructed the Participant to deal otherwise with theparticular order;(b)

the Participant executes the order upon receipt at a better price;(c)the Participant returns the order for confirmation of the terms of the order;(d)the Participant withholds the order pending confirmation that the ordercomplies with applicable securities requirements or, if applicable, theMarketplace Rules of any Exchange on which the security is listed or of any
QTRS on which the security is quoted;(e)the Participant determines based on market conditions that entering the order
on a marketplace would not be in the best interests of the client;(f)the order has a value of more than $100,000;(g)

the order is part of a trade to be made in accordance with Rule 6.4 by meansother than entry on a marketplace; or(h)the client has directed or consented to the order being entered on amarketplace as:(i)

a Call Market Order,(ii)

an Opening Order,(iii)

a Special Terms Order,(iv)

a Volume-Weighted Average Price Order,(v)

a Market-on-Close Order,(vi)

a Basis Order, or(vii) a Closing Price Order.
(2)

If a Participant withholds a client order from entry on a marketplace based onmarket conditions in accordance with clause (1)(e), the Participant may enter theorder in parts over a period of time or adjust the terms of the order prior to entry but
the Participant must guarantee that the client receives:(a)a price at least as good as the price the client would have received if theclient order had been executed on receipt by the Participant; and(b)

if the Participant executes the client order against a principal order or nonclient order, a better price than the price the client would have received if theclient order had been executed on receipt by the Participant.

Part 6 - Order Entry and Exposure
October 4, 2019

UMIR 6.3-1

POLICY 6.3 – EXPOSURE OF CLIENT ORDERS
Part 1 – Reviewing Small Orders for Market Impact
Rule 6.3 requires a Participant to immediately enter client orders for the purchase or sale of 50
standard trading units or less on a marketplace. This requirement is subject to certain
exceptions. The Participant may withhold the order based on a determination that market
conditions were such that immediate entry of the order would not be in the best interests of theclient. If the order is withhold the Participant must guarantee that the client receives a price atleast as good as the price the client would have received had the client order been executed onreceipt by the Participant. If the order is executed against a principal order or non-client orderthe client must receive a better price.

Part 2 – Confirmation of Order Terms
Pursuant to Rule 6.3, a Participant may withhold entry of the order and return the order to its
source for confirmation of its terms. For example, a Participant who receives an order to sell asecurity at $3 in a stock trading at $20 may return the order to the branch, as it is likely thateither the price or the stock symbol is wrong.

Part 3 –Client Request to Withhold Order
A Participant does not have to immediately enter a client order on a marketplace if the client hasrequested that the order be withheld (for example, the client does not want the order executedin the open market but wishes to do a tax-related trade with their spouse). Any request must be
specific to that order. A client cannot give a blanket request to withhold any future orders theclient may give the Participant. Furthermore, the Participant may not solicit a request towithhold the order. A Participant must keep a record of the client’s request to withhold orders
for seven years from the date of the instruction and, for the first two years, the request must be
kept in a readily accessible location.
Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Basis Order”, “better price”, “Call Market Order”, “client order”, “Closing Price Order”,“Exchange”, ”Market-on-Close Order”, “marketplace”, “Marketplace Operation Instrument”, “Marketplace
Rules”, “non-client order”, “Opening Order”, “Participant”, “principal order”, “QTRS”, “Special Terms
Order”, “standard trading unit” and “Volume-Weighted Average Price Order”
UMIR section 1.2(2) – “trade”

Related Provision:

UMIR section 1.2(3) - Interpretation

Regulatory History:

Effective April 8, 2005, the applicable securities commissions approved an amendment to clause (h) ofsubsection (1) of Rule 6.3 to add subclause (vi). See Market Integrity Notice 2005-010 – “Provisions
Respecting a “Basis Order”” (April 8, 2005).
Effective March 9, 2007, the applicable securities commissions approved an amendment to subsection(1) of Rule 6.3 to add the phrase “that displays orders in accordance with Part 7 of the Marketplace
Operation Instrument” after the first occurrence of the word “marketplace” and to amend clause (h) to add
subclause (vii). See Market Integrity Notice 2007-002 – “Provisions Respecting Competitive
Marketplace” (February 26, 2007).
On April 13, 2012, the applicable securities commissions approved amendments to subsection (1) of
Rule 6.3, effective October 15, 2012, to add the phrase “for display” after the word “enter”, to clause (e) ofsubsection (1) to add the phrase “on a marketplace” after the word “order” and to subsection (2) to add
the phrase “on a marketplace” before the word “based”. See IIROC Notice 12-0131 – “Provisions
Respecting the Execution and Reporting of Certain “Off-Marketplace” Trades” (April 13, 2012).
Effective December 9, 2013, the applicable securities commissions approved amendments to the FrenchPart 6 - Order Entry and Exposure
October 4, 2019

UMIR 6.3-2

version of UMIR. See IIROC Notice 13-0294 – Notice of Approval and Implementation – “Amendments
to the French version of UMIR” (December 9, 2013).
Partially Repealed Guidance: See Market Integrity Notice 2007-019 – “Entering Client Orders on Non-Transparent
Marketplaces and Facilities” (September 21, 2007). Q. 2 and 6 of this Notice was partiallyrepealed effective January 2, 2018 by IIROC Notice 17-0138 – “Guidance on Best Execution”(July 6, 2017).
Disciplinary Proceedings:

Rule 6.3(1) was considered In the Matter of TD Securities Inc. (“TDSI”) (July 5, 2006) DN 2006007. See Disciplinary Proceedings under Rule 5.1.

Disciplinary Proceedings:

In the Matter of BMO Nesbitt Burns (“BMO”) (October 4, 2019), 2019 IIROC 28
Facts – Between September 2014 and March 2016, BMO Nesbitt approved and permitted an order
execution procedure for a Registered Representative which resulted in some retail client orders thatwere less than 50 standard trading units (5,000 units for securities priced $1.00 or more) being
accumulated over a one hour period before they were entered on a marketplace. This was contrary
to UMIR 6.3, commonly known as the “Order Exposure Rule.”
Disposition and Sanction – Pursuant to a Settlement Agreement, BMO admitted that it permitted an
RR to use an order execution procedure that was contrary to UMIR 6.3. BMO paid a fine of $50,000
and costs of $5,000.
Requirements Considered – Rule 6.3.

Part 6 - Order Entry and Exposure
October 4, 2019

UMIR 6.3-3

Universal Market Integrity Rules

Rules & Policies

6.4

Trades to be on a Marketplace(1)

A Participant acting as principal or agent may not trade nor participate in a trade
in a security by means other than the entry of an order on a marketplace.

(2)

Subsection (1) does not apply to a trade:(a)Unlisted or Non-Quoted Security – in a security which is not a listed
security or a quoted security;(b)

Regulatory Exemption – required or permitted by a Market Regulator to
be executed other than on a marketplace in order to maintain a fair ororderly market and provided, in the case of a listed security or quoted
security, the Market Regulator requiring or permitting the order to be
executed other than on a marketplace shall be the Market Regulator of
the Exchange on which the security is listed or of the QTRS on which thesecurity is quoted;(c)Error Adjustment – to adjust by a journal entry an error in connection
with a client order;(d)

On a Foreign Organized Regulated Market – executed on a foreignorganized regulated market;(e)Outside of Canada – executed as principal with a non-Canadian accountor as agent if both the purchasers and seller are non-Canadian accounts
provided the trade is reported to a marketplace or a foreign organizedregulated market in accordance with the reporting requirements of themarketplace or foreign organized regulated market;(f)Term of Securities – as a result of a redemption, retraction, exchange orconversion of a security in accordance with the terms attaching to thesecurity;(g)

Options – as a result of the exercise of an option, right, warrant or similar
pre-existing contractual arrangement;(h)Prospectus and Exempt Distributions – pursuant to a prospectus,
take-over bid, issuer bid, amalgamation, arrangement or similartransaction including any distribution of previously unissued securities by
an issuer;(i)

Non-Regulatory Halt, Delay or Suspension – in a listed security orquoted security in respect of which trading has been halted, delayed orsuspended in circumstances described in clause (3)(a) or subclause(3)(b)(i) of Rule 9.1 that is not listed, quoted or traded on a marketplace
other than the Exchange or QTRS on which the security is halted,
delayed or suspended provided such trade is reported to a marketplace;Part 6 – Order Entry and Exposure
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UMIR 6.4-1

(j)Acceptable Foreign Trade Reporting Facility – in a listed security orquoted security that is reported to an acceptable foreign trade reporting
facility and :(i) is more than 50 standard trading units and has a value of more that
$100,000; or(ii) originated from a contingent order related to a derivative transaction
where the derivative transaction occurs outside of Canada and thetrade in the listed or quoted security is handled by the sameintermediary as the derivative transaction; or(k) Resale Restriction - in a listed security that is:(i)subject to a restricted period as determined in accordance with
National Instrument 45-102 Resale of Securities, and(ii) pursuant to a prospectus exemption available under applicablesecurities legislation; or(3)The exemption provided for in clause (d) of subsection (2) is unavailable to anorder of a Canadian account denominated in Canadian funds that:(a)is part of an intentional cross;(b)

is part of a pre-arranged trade;(c)is for more than 50 standard trading units; or(d)has a value of $250,000 or more
if the entry of the order on a foreign organized regulated market would avoid
execution against a better-priced order entered on a marketplace pursuant toPart 6 of the Trading Rules.

POLICY 6.4 – TRADES TO BE ON A MARKETPLACE
Part 1 – Trades Outside of Marketplace Hours
In accordance with section 6.1 of the Trading Rules, each marketplace shall set requirements in
respect of the hours of trading to be observed by marketplace participants. Occasions may arise
when a Participant may wish to make an agreement to trade as principal with a Canadianaccount, or to arrange a trade between a Canadian account and a non-Canadian account,
outside of the trading hours of any marketplace that trades the particular security.
Rule 6.4 states that all trades must be executed on a marketplace unless otherwise exemptedfrom this requirement. Participants are reminded of the exemption in clause (2)(d) of Rule 6.4
that permits a trade on a foreign organized regulated market. Participants are also reminded ofthe exemption in clause (2)(e) of Rule 6.4 that permits them to trade as principal with nonCanadian accounts off of a marketplace provided that any unwinding trade with a Canadianaccount is made in accordance with Rule 6.4.
A Participant may make an agreement to trade in a listed security or a quoted security with a
Canadian account as principal or as agent outside of the trading hours of marketplaces,
however, such agreements must be made conditional on execution of the trade on a
Part 6 – Order Entry and Exposure
July 27, 2023

UMIR 6.4-2

marketplace or on a foreign organized regulated market. There is no trade until such time as
there is an execution on a marketplace or a foreign organized regulated market or the trade isotherwise completed in accordance with one of the exemptions set out in Rule 6.4. The trade ona marketplace is to be done at or immediately following the opening of the marketplace on
which the order is entered. A Participant may cross the trade at the agreed-upon price provided
that the normal Requirements on order displacement are followed. If the Participant determinesthat the condition of recording the agreement to trade on a marketplace or foreign organizedregulated market cannot be met, the agreement to trade shall be cancelled. Use of an error
account to preserve the transaction is prohibited.

Part 2 – Application to Foreign Affiliates and Others
The Market Regulator considers that any use by a Participant of another person that is not
subject to Rule 6.4 in order to make a trade off of a marketplace (other than as permitted by oneof the exemptions) to be a violation of clause (a) of subsection (2) of Rule 2.1 respecting
specific unacceptable activities.
Although certain affiliated entities of a Participant, including their foreign affiliates, are notdirectly subject to Requirements, Rule 6.4 means that a Participant may not transfer an order toa foreign affiliate, or book a trade through a foreign affiliate, and execute the order in a mannerthat does not comply with Rule 6.4. In other words, an order directed to a foreign affiliate by theParticipant or any other person subject to Rule 6.4 shall be executed on a marketplace unless
one of the exemptions set out in Rule 6.4 applies. Foreign branch offices of a Participant are notseparate from the Participant and as such are subject to Requirements.

Part 3 – Non-Canadian Accounts
Clause (2)(e) of Rule 6.4 permits a Participant to trade off of a marketplace either as principalwith a non-Canadian account or as agent for the purchaser and seller both of whom are nonCanadian accounts. A "non-Canadian account" is defined as an account of a client of theParticipant or a client of an affiliated entity of the Participant held by a Participant or an affiliatedentity of a Participant and the client is considered to be a non-resident for the purposes of the
Income Tax Act (Canada). There may be certain situations arising where a Participant is
uncertain whether a particular account is a "non-Canadian account" for the purpose of thisexemption. In these situations the account should be treated as a “Canadian account”. The factthat an individual may be located temporarily outside of Canada, that a foreign location is used
to place the order or as the address for settlement or confirmation of the trade does not alter theaccount's status as a Canadian account. Trades made by or on behalf of bona fide foreignsubsidiaries of Canadian institutions are considered to be non-Canadian accounts, if the order isplaced by the foreign subsidiary.
For the purpose of this Policy, the relevant client of the Participant is the person to whom theorder is confirmed.

Part 4 – Reporting Foreign Trades
Part 6 – Order Entry and Exposure
July 27, 2023

UMIR 6.4-3

Clause (2)(e) of Rule 6.4 requires a Participant to report to a marketplace any trade in a listed
security or a quoted security that is made as principal with a non-Canadian account or as agent
if both the purchaser and seller are non-Canadian accounts, unless the trade is reported to aforeign organized regulated market. If such an “outside Canada” trade has not been reported toa foreign organized regulated market, a Participant shall report such trade to a marketplace nolater than the close of business on the next trading day. The report shall identify the security,
volume, price (in the currency of the trade and in Canadian dollars) and time of the trade.

Part 5 – Application of UMIR to Orders Not Entered on a Marketplace
Under Rule 6.4, a Participant, when acting as principal or agent, may not trade nor participate ina trade in a security by means other than the entry of an order on a marketplace except inaccordance with an exemption specifically enumerated within Rule 6.4. For the purposes of
UMIR, a “marketplace” is defined as an Exchange, QTRS or an ATS and a “Participant” isdefined essentially as a dealer registered in accordance with securities legislation of any
jurisdiction and who is a member of an Exchange, a user of a QTRS or a subscriber to an ATS.
If a person is a Participant, certain provisions of UMIR will apply to every order handled by that
Participant even if the order is entered or executed on a marketplace that has not adopted
UMIR as its market integrity rules or if the order is executed over-the-counter. In particular, thefollowing provisions of UMIR and the Corporation Rules will apply to an order handled by aParticipant notwithstanding that the order is not entered on a marketplace that has adopted
UMIR:•

Rule 4.1 prohibits a Participant from frontrunning certain client orders;•Part C of Corporation Rule 3100 – Best Execution of Client Orders with respect to the“best execution obligation” of a client order;•

Rule 8.1 governing client-principal trading; and•Rule 9.1 governing regulatory halts, delays and suspensions of trading.

In accordance with Rule 11.9, UMIR will not apply to an order that is entered or executed on amarketplace in accordance with the Marketplace Rules of that marketplace as adopted inaccordance with Part 7 of the Trading Rules or if the order is entered and executed on amarketplace or otherwise in accordance with the rules of an applicable regulation services
provider or in accordance with the terms of an exemption from the application of the Trading
Rules.

Part 6 – Foreign Currency Translation
If a trade is to be executed on a foreign organized regulated market in a foreign currency, theforeign trade price shall be converted to Canadian dollars using the exchange rate theParticipant would have applied in respect of a trade of similar size on a foreign organizedregulated market in that foreign jurisdiction in order to determine whether the condition insubsection (3) of Rule 6.4 restricting avoidance of Part 6 of the Trading Rules has been met.
The Market Regulator regards a difference of one trading increment or less as "marginal"
because the difference would be attributable to currency conversion. A Participant shallmaintain with the record of the order the exchange rate used for the purpose of determining
whether a better priced order existed on a marketplace and such information shall be provided
Part 6 – Order Entry and Exposure
July 27, 2023

UMIR 6.4-4

to the Market Regulator upon request in such form and manner as may be reasonably requiredby the Market Regulator in accordance with subsection (3) of Rule 10.11.
Defined Terms:

NI 14-101 section 1.1(3) – “foreign jurisdiction”, “issuer bid”, “securities legislation” and “take-over bid”
NI 21-101 section 1.1 - “ATS”, “marketplace participant”, “member”, “order”, “regulation services provider”,“subscriber” and “user”
NI 21-101 section 1.3(1) – Interpretation -- “affiliated entity”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Canadian account”, “client order”, “Exchange”, “foreign organized regulated market”,“intentional cross”, “listed security”, “Market Regulator”, “marketplace”, “Marketplace Rules”, “non-Canadianaccount”, “Participant”, “pre-arranged trade”, “quoted security”, “QTRS”, “related entity”, “Requirements”,“standard trading unit”, “trading day”, “trading increment”, “Trading Rules” and “UMIR”
UMIR section 1.2(2) – “person” and “trade”

Related Provisions:

UMIR section 2.1 and 4.1, UMIR Part 5, UMIR sections 6.1, 9.1, 10.11 and 11.9.

Regulatory History:

Effective May 16, 2008, the applicable securities commissions approved amendments to Rule 6.4 and Policy
6.4 to replace clauses (d) and (e) of Rule 6.4, add clause (i), and replace Policy 6.4. See Market Integrity
Notice 2008-008 – “Provisions Respecting “Off-Marketplace Trades” (May 16, 2008).
Effective February 1, 2011, the applicable securities commissions approved amendments to Rule 6.4,
including the introduction of subsections (1) and (2) and the addition of subsection (3). See IIROC Notice 110036 – “Provisions Respecting the Implementation of the Order Protection Rule” (January 28, 2011).
Effective December 9, 2013, the applicable securities commissions approved amendments to the French
version of UMIR. See IIROC Notice 13-0294 – Notice of Approval and Implementation – “Amendments to
the French version of UMIR” (December 9, 2013).
Effective September 1, 2016, the applicable securities commissions approved amendments to Part 2 andPart 5 of Policy 6.4. See IIROC Notice 16-0122 – “Implementation of the consolidated IIROC
Enforcement, Examination and Approval Rules” (June 9, 2016).
Effective January 2, 2018, the applicable securities commission approved amendments to Part 5 of Policy
6.4. See IIROC Notice 17-0137 – “Amendments Respecting Best Execution” (July 6, 2017).
Effective November 7, 2018, the applicable securities commissions approved amendments to Rule 6.4 to
add clause (j). See IIROC Notice 18-0154 – “Amendments Respecting the Reporting of Certain Trades
to Acceptable Foreign Trade Reporting Facilities” (August 9, 2018).
Effective December 31, 2021, the applicable securities commissions approved housekeeping amendments
to replace rule references to the Dealer Member Rules with provisions of the IIROC Rules. See IIROC
Notice 20-0042 - Rules Notice – Notice of Approval – UMIR – “Housekeeping amendments to UMIR
Following Implementation of IIROC Rules” (March 5, 2020).
Effective March 1, 2023, the applicable securities commissions approved amendments to UMIR 6.4(2)(k) toallow Participants to trade a listed security off-marketplace during a statutory resale restriction where thetrading is permitted pursuant to a prospectus exemption. See Notice 22-0185 – “Amendments Respecting
the Codification of Certain UMIR Exemptions” (December 1, 2022).
Effective July 27, 2023, the applicable securities commissions approved housekeeping amendments to
UMIR to correct inaccurate referencing and typographical mistakes and to ensure consistency between the
English and French versions of UMIR. See CIRO Bulletin 23-0107 - "Housekeeping Amendments to
UMIR" (July 27, 2023).

Guidance:

See Market Integrity Notice 2003-009 - “Trades on an Organized Regulated Market” (April 29, 2003).

Guidance:

See Market Integrity Notice 2003-010 - “Trades in Debt Securities” (May 5, 2003).

Guidance:

See Market Integrity Notice 2003-017 - “Trades in Listed or Quoted Securities” (August 20, 2003).

Guidance:

See Market Integrity Notice 2003-026 - “Trades in TSX-Listed Tier 1 Financing Securities” (issued on
December 5, 2003).

Guidance:

See Market Integrity Notice 2006-002 - “Guidance – ‘When Issued’ Trading” (January 30, 2006).

Guidance:

See Market Integrity Notice 2006-009 - “Guidance – Trades to be on a Marketplace When Acting As
Agent”. (March 24, 2006).

Guidance:

See Market Integrity Notice 2007-018 - “Specific Questions Related to Trading Listed Debt and Other

Part 6 – Order Entry and Exposure
July 27, 2023

UMIR 6.4-5

Securities”. (September 7, 2007).
Guidance:

See IIROC Notice 09-0224 - “Procedures For Handling Certain Designated Trades As Principal” (July30, 2009).

Guidance:

See IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).

Guidance:

See Notice 22-0186 – “Obtaining a Trading Exemption or Rule Interpretation” (December 1, 2022).

Guidance:

See Notice 23-0055 – “Procedures for Handling Certain Designated Trades as Principal” (April 17,2023).

Disciplinary Proceedings:

In the Matter of John Warwick Holland (“Holland”) (October 29, 2002) OOS 2002-006
Facts – Between April 1, 1999 and July 31, 1999, Holland, an investment advisor employed by Yorkton
Securities Inc., facilitated the purchase of shares of a Vancouver Stock Exchange listed company for fiveclients. The acquisition of the shares was conducted by way of journal entries and not on an exchange.
Disposition – Subject to specific exemptions, which do not apply to these circumstances, all trades of
exchange-listed securities must be conducted on a marketplace.
Requirements Considered – VSE Rules C.1.08. Comparable UMIR Provision - Rule 6.4.
Sanction - $10,000 voluntary payment and $3,500 for costs.

Disciplinary Proceedings:

Rule 6.4 was considered In the Matter of Louis Anthony De Jong (“DeJong”) and Dwayne
Barrington Nash (“Nash”) (July 29, 2004) Decision 2004-004. See Disciplinary Proceedings under
2.1.

Disciplinary Proceedings:

In the Matter of Credit Suisse First Boston Canada Inc. (“CSFB”) (December 3, 2004) SA 2004-007
Facts – On April 15, 2003, CSFB entered into an agreement to purchase, as principal, 9,047,092 BCE
shares. Shortly thereafter CSFB and its affiliates began to contact clients (including Canadian clients) toline up purchasers for the shares. The indicated interest was greater than expected, and CSFB faced asignificantly over-subscribed book. To avoid the displacement obligations associated with conducting thetrade as a block trade or wide distribution on the TSX and on other markets, the firm decided to executethe take-on trade (principal buy) through the over-the-counter (“OTC”) market in London and theunwinding trade (principal sell) in the OTC market in the United States. On April 16, 2003, as part of its
unwinding trade to Canadian clients, CSFB executed the trade of 7,701,000 BCE shares to Canadianaccounts on the New York OTC market prior to the opening of the market. CSFB subsequently reported
details of the unwinding trade the NASD and NYSE. Later the same day the take-on trade was crossed
through London with details of the transaction being reported to the Financial Services Authority (“FSA”).
Disposition – Compliance with Rule 6.4(e) required that the “take-on” trade be reported to a marketplace,stock exchange or organized regulated market that publicly disseminates details of trades in the market.
To the extent that the FSA does not publicly disseminate transaction reports, the take-on trade was notconducted in accordance with Rule 6.4.
Conducting a trade to Canadian clients in the OTC market in the United States outside of market hours,
even if that trade is subsequently reported to the NYSE and NASD, does not constitute execution of a
trade on “another exchange or organized regulated market that publicly disseminates details of trades inthat market” within the purview Rule 6.4(d). CSFB executed the unwinding-trades to Canadian clients
before the opening of the market with the knowledge that trades conducted prior to the opening of themarkets would not be printed on a consolidated tape.
Requirements Considered – Rules 6.4 and 10.11(1).
Sanction - $1,350,000 fine and costs of $150,000.

Disciplinary Proceedings:

Rule 6.4 was considered In the Matter of Salman Partners Inc. (“Salman”), Sameh Magid (“Magid”),
William Burk (“Burk”) and Ian Todd (“Todd”) (February 18, 2005) SA 2005-001. See Disciplinary
Proceedings under Rule 3.1.

Disciplinary Proceedings:

In the Matter of Scotia Capital Inc. (“Scotia”) (February 26, 2007) DN 2007-001
Facts – In the period April 4, 2002 to April 18, 2005 an agency trader at Scotia Capital Inc. (“Scotia”)
and the registrant responsible for trading Scotia’s proprietary book of preferred shares, engaged in apattern of soliciting client orders during periods when Scotia was involved in a distribution of the subject
securities. In total, 39 client orders were solicited in 16 new issues at times when Scotia was involved ina distribution. In respect of 15 of the solicitations, on or about the first day of trading, off-marketplace
trades were conducted in the newly listed shares by selling them “short” from an inventory account at the
distribution price. In respect of 24 of the solicitations, the trades to clients from an inventory account took
place before the security was listed, in the “grey market”. The short positions were covered bypurchasing shares of the newly issued shares in the secondary market, in most cases at prices lower

Part 6 – Order Entry and Exposure
July 27, 2023

UMIR 6.4-6

than the distribution price paid by clients during the distribution. The profit to the inventory account fromshorting the shares was $731,959, of which Scotia received 80% ($571,167).
Disposition – The sale of securities from an inventory account were secondary market transactions, andas such, purchasers of the shares were not afforded the inherent rights that they would have beenotherwise entitled to as purchasers of a “new issue” under a prospectus. In addition, the off-marketplace
trades were improper and resulted in market participants potentially being misled as to the true nature of
the demand for the shares and may have affected their investment decisions. Scotia is liable under
UMIR for contraventions by its representatives between April 4, 2002 and October 14, 2003 of UMIR
provisions related to trading by a Participant involved in a distribution of securities (28 occasions) andthe requirement that trades be on a marketplace (5 occasions).
Requirements Considered – Rules 6.4, 7.7(5) (pre-May 2005 version), 10.3(1) and 10.3(4).
Sanction – $571,167 fine and costs of $67,000.
Disciplinary Proceedings:

In the Matter of David Berry (“Berry”) (January 17, 2013) DN 13-0018
Facts – Between April 2002 and April 2005 (the “Relevant Period”), Berry, Head of Preferred Trading
and the registrant responsible for trading Scotia Capital’s proprietary book of preferred shares, solicited
Canadian client buy orders in new issues on or about the dates the new issues were publicly announced.
Clients agreed to pay the distribution prices for the new issues prior to the date on which the securities
were assigned a CUSIP number and the new issue began trading on the TSX. On the first day of trading,
Berry conducted off-marketplace trades in the newly listed shares by selling them short from his
inventory account to clients at the distribution price. The trades were not printed on a marketplace ororganized regulated market. Berry subsequently covered the short positions in the newly listed shares
created in the inventory account by buying shares in the marketplace, either on the first day of trading forthe newly listed shares or at a later date or dates. IIROC alleged this was contrary to UMIR 7.7(5) [as itexisted prior to May, 2005] and UMIR 6.4. Scotia Capital previously acknowledged breaches of UMIR
7.7(5) and 6.4.
Held – Berry was entitled to the presumption of innocence and the fact that third party Scotia Capitalacknowledged breaches of UMIR 7.7(5) and 6.4 did not in any way affect Berry. Berry traded in new,unlisted securities and thus did not contravene UMIR 6.4. The panel also determined that UMIR 7.7(5)was meant to prevent price manipulation of existing shares. Berry did not contravene UMIR 7.7(5)because he traded new, unlisted securities at the distribution price, and was therefore not capable ofinfluencing the price of the securities.
Requirements Considered – Rules 7.7(5) [as it existed prior to May, 2005] and 6.4.
Disposition – The charges against Berry were dismissed.

Disciplinary Proceedings:

In the Matter of RBC Dominion Securities, Scotia Capital, and TD Securities (November 1, 2019),
2019 IIROC 30
Facts – On May 8, 2018, the Respondents participated in an underwriting syndicate and settled sharesof a block trade by way of journal entries and did not enter the trades that they settled on behalf ofclient accounts on a marketplace. Pursuant to UMIR 6.4, the trades settled by the Respondents ought
to have been entered on a marketplace unless they obtained an exemption pursuant to UMIR 6.4(2)(b)or, if applicable, another exemption listed in UMIR 6.4.
Disposition and Sanction – Pursuant to a Settlement Agreement, the Respondents admitted that on
May 8, 2018, they participated in trading in a security by means other than the entry of an order on amarketplace, contrary to UMIR 6.4. Each of the Respondents agreed to pay a fine in the amount of$500,000 and pay costs of $10,000.
Requirements Considered – Rule 6.4.

Part 6 – Order Entry and Exposure
July 27, 2023

UMIR 6.4-7

Universal Market Integrity Rules

Rules & Policies

6.5

Minimum Size Requirements of Certain Orders Entered on a Marketplace
A Participant or Access Person shall not enter an order for the purchase or sale of asecurity on a marketplace if:(a)the order is a Dark Order and the order does not exceed the number of units as
designated from time to time by the Market Regulator for the purposes of thisclause; or(b)less than one standard trading unit of the order or such greater number of units as
designated from time to time by the Market Regulator for the purposes of thisclause will be displayed in a consolidated market display on the entry of the orderon the marketplace and at any time prior to the full execution of the order.

Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “consolidated market display”, “Dark Order”, “Market Regulator”,“marketplace”, “Participant” and “standard trading unit”

Regulatory History:

On April 13, 2012, the applicable securities commissions approved an amendment, effective October
15, 2012, to add section 6.5.

Part 6 – Order Entry and Exposure
October 15, 2012

UMIR 6.5-1

Universal Market Integrity Rules

Rules & Policies

6.6

Provision of Price Improvement by a Dark Order(1)

If a Participant or Access Person enters an order on a marketplace for thepurchase or sale of a security that order may execute with a Dark Order provided
the order entered by the Participant or Access Person is executed:(a)

at a better price;(b)in the case of a purchase, at the best ask price if:

(c)

(i)

the order on entry to the marketplace is for more than 50 standard
trading units and has a value of more than $30,000 or has a value ofmore than $100,000, and(ii)

on the execution of the trade with the Dark Order, no orders for the saleof the security included in the calculation of the best ask price aredisplayed on that marketplace at that best ask price; orin the case of a sale, at the best bid price if:(i)the order on entry to the marketplace is for more than 50 standard
trading units and has a value of more than $30,000 or has a value ofmore than $100,000, and(ii) on the execution of the trade with the Dark Order, no orders for thepurchase of the security included in the calculation of the best bid priceare displayed on that marketplace at that best bid price.
(2)

Subsection (1) does not apply if the order entered by the Participant or Access
Person is:(a)a Basis Order;(b)

a Call Market Order;(c)a Closing Price Order;(d)a Market-on-Close Order;(e)an Opening Order;(f)a Volume-Weighted Average Price Order; or(g)for less than one standard trading unit.

Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “Basis Order”, “best ask price”, “best bid price”, “better price”,“Call Market Order”, ”Closing Price Order”, “Dark Order”, ”Market-on-Close Order”, “Market Regulator”,“marketplace”, “Opening Order”, “Participant”, “standard trading unit” and “Volume-Weighted Average
Price Order”
UMIR section 1.2(2) – “trade”

Regulatory History:

On April 13, 2012, the applicable securities commissions approved an amendment, effective October 15,
2012, to add section 6.6.
Effective July 30, 2015, the applicable securities commission approved an amendment to subsection
6.6(2). See IIROC Notice 15-0168 – “Dark Order Price Improvement Obligations When Trading
Against an Odd-Lot Order” (July 30, 2015).

Part 6 – Order Entry and Exposure
February 4, 2020

UMIR 6.6-1

Effective February 4, 2020, the applicable securities commission approved amendments to subsection
6.6 (1). See IIROC Notice 19-0134 – “Amendments Respecting Provision of Price Improvement by a
Dark Order” (August 8,2019).
Guidance:

See IIROC Notice 12-0295 – “Specific Questions Related To Dark Liquidity Rule Amendments”(October 9, 2012).

Part 6 – Order Entry and Exposure
February 4, 2020

UMIR 6.6-2

Universal Market Integrity Rules

Rules & Policies

PART 7 – TRADING IN A MARKETPLACE
7.1

Trading Supervision Obligations(1)

Each Participant shall develop, implement and maintain written policies andprocedures to be followed by directors, officers, partners and employees of theParticipant that are reasonably designed, taking into account the business andaffairs of the Participant, to ensure compliance with UMIR and each Policy as
applicable.

(2)

Prior to the entry of an order on a marketplace by a Participant, the Participant
shall comply with:(a)applicable regulatory standards with respect to the review, acceptance andapproval of orders;(b)the policies and procedures adopted in accordance with subsection (1); and(c)all applicable requirements of UMIR and each Policy.

(3)

Each Participant shall appoint a head of trading who shall be responsible tosupervise the trading activities of the Participant in a marketplace.

(4)

The head of trading together with each person who has authority or supervision
over or responsibility to the Participant for an employee of the Participant shall fully
and properly supervise such employee as necessary to ensure the compliance ofthe employee with UMIR and each Policy.

(5)

Notwithstanding any other provision of this Rule, a Participant or Access Person
shall not mark an order on entry to a marketplace as a directed action order unlessthe Participant or Access Person has established, maintained and ensured
compliance with written policies and procedures that are reasonably designed toprevent trade-throughs other than those trade-throughs permitted in Part 6 of theTrading Rules.

(6)

Notwithstanding any other provision of this Rule, a Participant or an Access Person
shall adopt, document and maintain a system of risk management and supervisory
controls, policies and procedures reasonably designed, in accordance with prudent
business practices, to ensure the management of the financial, regulatory andother risks associated with:(a)access to one or more marketplaces; and(b)

if applicable, the use by the Participant, any client of the Participant or theAccess Person of an automated order system.

Part 7 – Trading in a Marketplace
January 1, 2023

UMIR 7.1-1

(7)

(8)

(9)

A Participant may, on a reasonable basis:(a)authorize an investment dealer to perform on its behalf the setting or
adjusting of a specific risk management or supervisory control, policy orprocedure; or(b)

use the services of a third party that provides risk management andsupervisory controls, policies and procedures.

An authorization over the setting or adjusting of a specific risk management or
supervisory control, policy or procedure or retaining the services of a third party
under subsection (7) must be in a written agreement with the investment dealer or
third party that;(a)precludes the investment dealer or third party from providing any otherperson control over any aspect of the specific risk management or
supervisory control, policy or procedure;(b)unless the authorization is to an investment dealer that is a Participant,precludes the authorization to the investment dealer over the setting or
adjusting of a specific risk management or supervisory control, policy orprocedure respecting an account in which the investment dealer or a related
entity of the investment dealer holds a direct or indirect interest other than aninterest in the commission charged on a transaction or reasonable fee for theadministration of the account; and(c)precludes the use of a third party unless the third party is independent ofeach client of the Participant other than affiliates of the Participant.

A Participant shall forthwith notify the Market Regulator:
(a)

(b)

upon entering into a written agreement with an investment dealer or third
party described in subsection (8), of:(i)the name of the investment dealer or third party, and(ii)

the contact information for the investment dealer or the third party which
will permit the Market Regulator to deal with the investment dealer or
third party immediately following the entry of an order or execution of a
trade for which the Market Regulator wants additional information; andof any change in the information described in clause (a).

(10) The Participant shall review and confirm:(a)at least annually that:(i)the risk management and supervisory controls, policies and procedures
under subsection (6) are adequate,(ii)

the Participant has maintained and consistently applied the risk
management and supervisory controls, policies and procedures since
the establishment of the controls, policies and procedures or the date of
the last annual review, andPart 7 – Trading in a Marketplace
January 1, 2023

UMIR 7.1-2

(iii)(b)

any deficiency in the adequacy of a control, policy or procedure has
been documented and promptly remedied;

if the Participant has authorized an investment dealer to perform on its behalf
the setting or adjusting of a specific risk management or supervisory control,
policy or procedure or retained the services of a third party, at least annuallyby the anniversary date of the written agreement with the investment dealeror third party that:(i)the risk management and supervisory controls, policies and procedures
adopted by the investment dealer or third party under subsection (6) are
adequate,(ii)

the investment dealer or third party has maintained and consistently
applied the risk management and supervisory controls, policies andprocedures since the establishment of the controls, policies andprocedures or the date of the last annual review,(iii)

any deficiency in the adequacy of a control, policy or procedure has
been documented by the Participant and promptly remedied by theinvestment dealer or third party, and(iv)

the investment dealer or third party is in compliance with the writtenagreement with the Participant.

POLICY 7.1 – TRADING SUPERVISION OBLIGATIONSPart 1 – Responsibility for Supervision and Compliance
For the purposes of Rule 7.1, a Participant shall supervise its employees, directors and officers
and, if applicable, partners to ensure that trading in securities or derivatives on a marketplace(an Exchange, QTRS or ATS) is carried out in compliance with the applicable Requirements(which includes provisions of securities legislation, UMIR, the Trading Rules and theMarketplace Rules of any applicable Exchange or QTRS). An effective supervision system
requires a strong overall commitment on the part of the Participant, through its board of
directors, to develop and implement a clearly defined set of policies and procedures that arereasonably designed to prevent and detect violations of Requirements. The board of directors of
a Participant is responsible for the overall stewardship of the firm with a specific responsibility tosupervise the management of the firm. On an ongoing basis, the board of directors must ensurethat the principal risks for non-compliance with Requirements have been identified and thatappropriate supervision and compliance procedures to manage those risks have been
implemented.
Management of the Participant is responsible for ensuring that the supervision system adopted
by the Participant is effectively carried out. The head of trading and any other person to whomsupervisory responsibility has been delegated must fully and properly supervise all employees
under their supervision to ensure their compliance with Requirements. If a supervisor has notfollowed the supervision procedures adopted by the Participant, the supervisor will have failed
to comply with their supervisory obligations under Rule 7.1(4).
When the Market Regulator reviews the supervision system of a Participant (for example, whena violation occurs of Requirements), the Market Regulator will consider whether the supervisory

Part 7 – Trading in a Marketplace
January 1, 2023

UMIR 7.1-3

system is reasonably well designed to prevent and detect violations of Requirements andwhether the system was followed.
The compliance department is responsible for monitoring and reporting adherence to rules,
regulations, requirements, policies and procedures. In doing so, the compliance department
must have a compliance monitoring system in place that is reasonably designed to prevent anddetect violations. The compliance department must report the results from its monitoring to theParticipant’s management and, where appropriate, the board of directors, or its equivalent.
Management and the board of directors must ensure that the compliance department isadequately funded, staffed and empowered to fulfill these responsibilities.
The obligation to supervise applies whether the order is entered on a marketplace:•by a trader employed by the Participant,•by an employee of the Participant through an order routing system,•

directly by a client and routed to a marketplace through the trading system of theParticipant, or•by any other means.

In performing the trading supervision obligations, the Participant will act as a “gatekeeper” tohelp prevent and detect violations of applicable Requirements.
When an order is entered on a marketplace by direct electronic access, under a routing
arrangement or through an order execution service, the Participant retains responsibility for thatorder and the supervision policies and procedures should adequately address the additional risk
exposure which the Participant may have for orders that are not directly handled by staff of theParticipant. For example, it may be appropriate for the Participant to sample for compliancetesting a higher percentage of orders that have been entered by a client under direct electronic
access, an investment dealer or foreign dealer equivalent under a routing arrangement or aclient through an order execution service than the percentage of orders sampled in othercircumstances.
In addition, the “post order entry” compliance testing should recognize that the limited
involvement of staff of the Participant in the entry of orders by a client under direct electronic
access, an investment dealer or foreign dealer equivalent under a routing arrangement or aclient through an order execution service may restrict the ability of the Participant to detectorders that are not in compliance with specific rules. For example, “post order entry” compliancetesting may be focused on whether an order entered by a client under direct electronic access ,an investment dealer or foreign dealer equivalent under a routing arrangement or a client
through an order execution service:•

has created an artificial price contrary to Rule 2.2;•

is part of a “wash trade” (in circumstances where the client has more than one accountwith the Participant);•

is an unmarked short sale (if the trading system of the Participant does not automaticallycode as “short” any sale of a security not then held in the account of the client other thana client required to use the “short-marking exempt” designation); and•has complied with other order marking requirements and in particular the requirement tomark an order as from an insider or significant shareholder (unless the trading system of
the Participant restricts trading activities in affected securities or derivatives).

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Part 2 – Minimum Elements of a Supervision System
For the purposes of Rule 7.1, a supervision system consists of both policies and procedures
aimed at preventing violations from occurring and compliance procedures aimed at detecting
whether violations have occurred.
The Market Regulator recognizes that there is no one supervision system that will beappropriate for all Participants. Given the differences among firms in terms of their size, thenature of their business, whether they are engaged in business in more than one location or
jurisdiction, the experience and training of their employees and the fact that effective
compliance can be achieved in a variety of ways, this Policy does not mandate any particular
type or method of supervision of trading activity. Furthermore, compliance with this Policy does
not relieve Participants from complying with specific Requirements that may apply in certain
circumstances. In particular, in accordance with subsection (2) of Rule 10.1, orders entered(including orders entered by a client under direct electronic access, an investment dealer or
foreign dealer equivalent under a routing arrangement or by a client through an order execution
service) must comply with the Marketplace Rules on which the order is entered and theMarketplace Rules on which the order is executed.
Participants must develop, implement and maintain supervision and compliance procedures thatexceed the elements identified in this Policy where the circumstances warrant. For example,
previous disciplinary proceedings, warning and caution letters from the Market Regulator or theidentification of problems with the supervision system or procedures by the Participant or theMarket Regulator may warrant the implementation of more frequent supervision or compliancetesting and more detailed supervision or compliance procedures.
Regardless of the circumstances of the Participant, however, every Participant must:
1.

Identify the relevant Requirements, securities laws and other regulatory
requirements that apply to the lines of business in which the Participant is engaged(the “Trading Requirements”).

2.

Document the supervision system by preparing a written policies and procedures
manual. The manual must be accessible to all relevant employees. The manualmust be kept current and Participants are advised to maintain an historical copy.

3.

Ensure that employees responsible for trading in securities or derivatives areappropriately registered and trained and that they are knowledgeable about theTrading Requirements that apply to their responsibilities. Persons with supervisory
responsibility must ensure that employees under their supervision are appropriately
registered and trained. Each Participant should provide a continuing training andeducation program to ensure that its employees remain informed of andknowledgeable about changes to the rules and regulations that apply to their
responsibilities.

4.

Designate individuals responsible for supervision and compliance. The compliancefunction must be conducted by persons other than those who supervise the trading
activity.

5.

Develop and implement supervision and compliance procedures that areappropriate for the Participant’s size, lines of business in which it is engaged andwhether the Participant carries on business in more than one location or
jurisdiction.

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6.

Identify the steps the Participant will take when a violation or possible violation of a
Requirement or any regulatory requirement has been identified. These steps shall
include the procedure for the reporting of the violation or possible violation to theMarket Regulator if required by Rule 10.16. If there has been a violation or possible
violation of a Requirement, identify the steps that would be taken by the Participant
to determine if:•

additional supervision should be instituted for the employee, the account or
the business line that may have been involved with the violation or possible
violation of a Requirement; and•the written policies and procedures that have been adopted by theParticipant should be amended to reduce the possibility of a future violationof the Requirement.

7.

Review the supervision system at least annually to ensure it continues to bereasonably designed to prevent and detect violations of Requirements. Morefrequent reviews may be required if past reviews have detected problems withsupervision and compliance.

8.

Document each step of the compliance review process to include details of thefollowing:•

individual(s) who conducted the review•

date(s) of the review•

sources of information used to conduct the review, including the initialalert that may have been triggered•

sample(s) used to conduct the review and the criteria for sample selection(if samples are used)•

queries made to the trader, client, and anyone else who handled theorder, if any•

results of the review•

measures taken to escalate concerns , if any•

corrective actions taken, if any.

9.

Maintain results of all reviews for at least five years.

10.

Report to the board of directors of the Participant or, if applicable, the partners, asummary of the compliance reviews conducted and the results of the supervisionsystem review. These reports must be made at least annually. If the Market
Regulator or the Participant identifies significant issues concerning the supervisionsystem or compliance procedures, the board of directors or, if applicable, thepartners, must be advised immediately.

Part 3 – Supervision and Compliance Procedures for Trading on a Marketplace
Each Participant must develop, implement and maintain supervision and compliance
procedures for trading in securities or derivatives on a marketplace that are appropriate for its size,
the nature of its business and whether it carries on business in more than one location or
jurisdiction. Such procedures should be developed having regard to the training andexperience of its employees and whether the firm or its employees have been previouslyPart 7 – Trading in a Marketplace
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UMIR 7.1-6

disciplined or warned by the Market Regulator concerning the violations of the Requirements.
Participants must identify any high-risk areas and ensure that their policies and procedures
are adequately designed to address these heightened risks.
In developing supervision systems, Participants must identify any exception reports, trading
data and any other relevant documents to be reviewed. In appropriate cases, relevant
information that cannot be obtained or generated by the Participant should be sought fromsources outside the firm including from the Market Regulator.
Each Participant must develop written policies and procedures in relation to all Requirementsthat apply to their business activities. A Participant’s supervision system must at a minimum
include the regular review of compliance with respect to the following provisions for trading on amarketplace where applicable to their lines of business:
•
•
•
•
•
•
•
•
•
•
•
•
•

Audit Trail requirements (Rule 10.11)
Electronic Access to Marketplaces (Rule 7.1)
Specific Unacceptable Activities (Rule 2.1)
Manipulative and Deceptive Activities (Rule 2.2)
Trading in restricted securities (Rule 7.7)
Trading of grey list securities (Rule 2.2)
Disclosure requirements (Rule 10.1)
Frontrunning (Rule 4.1)
Client/Principal Trading (Rule 8.1)
Client Priority (Rule 5.3)
Best Execution (Part C of Corporation Rule 3100 – Best Execution of Client Orders)
Order Exposure requirements (Rule 6.3)
Time synchronization requirements (Rule 10.14).

Each Participant must develop, implement and maintain a risk-based supervision system that
identifies and prioritizes those areas that pose the greatest risk of violations of Requirements. This
enables the Participant to focus its review on the areas that pose a higher risk of noncompliance with Requirements. The frequency of review and sample size used in reviews
must be commensurate with, among other things:
•
•
•
•
•
•
•

the Participant’s size (considering factors such as revenue, market share, market
exposure and volume of trades)
the Participant’s organizational structure
number and location of the Participant’s offices
the nature and complexity of the products and services offered by theParticipant
the number of registrants assigned to a location
the disciplinary history of registered representatives or associated persons
the risk profile of the Participant’s business and any indicators of irregularities or
misconduct i.e. “red flags”.

Part 4 – Specific Procedures Respecting Client Priority
Each Participant must develop, implement and maintain a supervision system toensure its trading does not violate Rule 5.3-

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The purpose of the Participant’s compliance review is to ensure that inventory or nonclient orders are not knowingly traded ahead of client orders. This would occur if a client
order is withheld from entry into the market and a person with knowledge of that client
order enters another order that will trade ahead of it. Doing so could take a trading
opportunity away from the client. Withholding an order for normal review and order
handling is allowed under Rule5.3 and Part C of Corporation Rule 3100 – Best
Execution of Client Orders, as this is done to ensure that the client gets a good
execution. To ensure that a supervision system is effective it must address potential
problem situations where trading opportunities may be taken away from clients.
Part 5 – Specific Procedures Respecting Manipulative and Deceptive Activities
and Reporting and Gatekeeper Obligations
Each Participant must develop, implement and maintain a supervision system to ensure thatorders entered on a marketplace by or through a Participant are not part of a manipulative or
deceptive method, act or practice nor an attempt to create an artificial price or a false or
misleading appearance of trading activity or interest in the purchase or sale of a security or aderivative.
In particular, the policies and procedures must address:•

the steps to be taken to monitor the trading activities of:ooan insider or an associate of an insider
part of or an associate of a promotional group or other group with an interest in
effecting an artificial price, either for banking and margin purposes, for purposesof effecting a distribution of the securities of the issuer or for any other improper
purpose•the steps to be taken to monitor the trading activity of any person who has multiple
accounts with the Participant including other accounts in which the person has aninterest or over which the person has direction or control•

those circumstances when the Participant is unable to verify certain information (such as
the beneficial ownership of the account on behalf of which the order is entered, unlessthat information is required by applicable regulatory requirements)•

the fact that orders which are intended to or which affect an artificial price are more likely
to appear at the end of a month, quarter or year or on the date of the expiry of options
where the underlying interest is a listed security, and•the fact that orders which are intended to or which affect an artificial price or a false or
misleading appearance of trading activity or investor interest are more likely to involve
securities or derivatives with limited liquidity.

A Participant will be able to rely on information contained on a “New Client Application Form” orsimilar know-your-client record maintained in accordance with requirements of securities
legislation or a self-regulatory entity provided such information has been reviewed periodically inaccordance with such requirements and any additional practices of the Participant.
While a Participant cannot be expected to know the details of trading activity conducted by aclient through another dealer, nonetheless, a Participant that provides advice to a client on thesuitability of investments should have an understanding of the financial position and assets ofPart 7 – Trading in a Marketplace
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UMIR 7.1-8

the client and this understanding would include general knowledge of the holdings by the clientat other dealers or directly in the name of the client. The supervision system of the Participant
should allow the Participant to take into consideration, information which the Participant hascollected respecting accounts at other dealers as part of the completion and periodic updating of
the “New Client Application Form”.
Each Participant must review a sample of its trading for manipulative and deceptive activities atleast on a quarterly basis.

Part 6 – Specific Provisions Respecting Trade-throughs
Each Participant must develop, implement and maintain a supervision system to ensure that anorder:•

marked as “directed action order” in accordance with Rule 6.2 does not result in a tradethrough other than a trade-through permitted under Part 6 of the Trading Rules; or•entered on a foreign organized regulated market complies with the conditions insubsection (3) of Rule 6.4.

Each Access Person must adopt written policies and procedures reasonably designed to detectand prevent an order marked as a “directed action order” in accordance with Rule 6.2 fromresulting in a trade-through other than a trade-through permitted under Part 6 of the Trading
Rules.
The policies and procedures must set out the steps or process to be followed by the Participantor Access Person to ensure that the execution of an order does not result in a trade-through.
The policies and procedures must specifically address the circumstances when the bypass
order marker will be used in conjunction with a “directed action order”. These policies andprocedures must address the steps which the Participant or Access Person will undertake on aregular basis, which shall not be less than monthly, to test that the policies and procedures areadequate.

Part 7 – Specific Provisions Applicable to Electronic AccessTrading supervision related to electronic access to marketplaces must be performed by aParticipant or Access Person in accordance with a documented system of risk management andsupervisory controls, policies and procedures reasonably designed to ensure the managementof the financial, regulatory and other risks associated with electronic access to marketplaces.
The risk management and supervisory controls, policies and procedures employed by aParticipant or Access Persons must include:• automated controls to examine each order before entry on a marketplace to prevent theentry of an order which would result in:othe Participant or Access Person exceeding pre-determined credit or capitalthresholdsoa client of the Participant exceeding pre-determined credit or other limits assigned by
the Participant or to that client, orothe Participant, Access Person or client of the Participant exceeding pre-determined
limits on the value or volume of unexecuted orders for a particular security orderivative or class of securities or derivatives

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UMIR 7.1-9•

provisions to prevent the entry of an order that is not in compliance with applicable
Requirements•

provision of immediate order and trade information to compliance staff of the Participantor Access Person•

regular post-trade monitoring for compliance with Requirements.

A Participant or Access Person is responsible and accountable for all functions that theyoutsource to a service provider as set out in Part 11 of Companion Policy 31-103CP
Registration Requirements and Exemptions.
Supervisory and compliance monitoring procedures must be designed to detect and prevent
account activity that is or may be a violation of Requirements which includes applicablesecurities legislation, requirements of any self-regulatory organization applicable to the accountactivity and the rules and policies of any marketplace on which the account activity takes place.
These procedures must include “post-order entry” compliance testing enumerated under Part 1of Policy 7.1 to detect orders that are not in compliance with specific rules, and by addressing
steps to monitor trading activity, as provided under Part 5 of Policy 7.1, of any person who has
multiple accounts, with the Participant and other accounts in which the person has an interest or
over which the person has direction or control.
Part 8 – Specific Provisions Applicable to Automated Order Systems
Trading supervision by a Participant or Access Person must be in accordance with adocumented system of risk management and supervisory controls, policies and procedures
reasonably designed to ensure the management of the financial, regulatory and other risks
associated with the use of an automated order system by the Participant, the Access Person or
any client of the Participant.
Each Participant or Access Person must have a level of knowledge and understanding of any
automated order system used by the Participant, the Access Person or any client of theParticipant that is sufficient to allow the Participant or Access Person to identify and manage therisks associated with the use of the automated order system.
The Participant or Access Person must ensure that every automated order system used by theParticipant, the Access Person or any client of the Participant is tested in accordance withprudent business practices initially before use and at least annually thereafter. A written record
must be maintained with sufficient details to demonstrate the testing of the automated ordersystem undertaken by the Participant, Access Person and any third party employed to provide
the automated order system or risk management or supervisory controls, policies andprocedures.
The scope of appropriate order and trade parameters, policies and procedures should betailored to the strategy or strategies being pursued by an automatic order system with due
consideration to the potential market impact of defining such parameters too broadly and in any
event must be set so as not to exceed the limits publicly disclosed by the Market Regulator forthe exercise of the power of a Market Integrity Official under Rule 10.9 of UMIR.
The Market Regulator expects the risk management and supervisory controls, policies andprocedures to comply with the Electronic Trading Rules and be reasonably designed to preventthe entry of any order that would interfere with fair and orderly markets. This includes adoptionof compliance procedures for trading by clients, if applicable, containing detailed guidance on
how testing of client orders and trades is to be conducted to ensure that prior to engagement
and at least annually thereafter, each automated order system is satisfactorily tested assuming
various market conditions. In addition to regular testing of the automated order systems,
preventing interference with fair and orderly markets requires development of pre-programmed
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UMIR 7.1-10

internal parameters to prevent or “flag” with alerts on a real-time basis, the entry of orders andexecution of trades by an automated order system that exceed certain volume, order, price orother limits.
Each Participant or Access Person must have the ability to immediately override or disable
automatically any automated order system and thereby prevent orders generated by theautomated order system from being entered on any marketplace.
Notwithstanding any outsourcing or authorization over of risk management and supervisioncontrols, a Participant or Access Person is responsible for any order entered or any trade
executed on a marketplace, including any order or trade resulting from the improper operationor malfunction of the automated order system. This responsibility includes instances in which
the malfunction which gave rise to a “runaway” algorithm is attributed to an aspect of thealgorithm or automated order system that was not “accessible” to the Participant or Access
Person for testing.
Part 9 - Specific Provisions Applicable to Direct Electronic Access and Routing
Arrangements
Standards for Clients, Investment Dealers and Foreign Dealer Equivalents
In addition to other trading supervision requirements, a Participant that provides direct electronic
access or implements a routing arrangement must establish, maintain and apply reasonable
standards for granting direct electronic access or a routing arrangement and assess anddocument whether each client, investment dealer or foreign dealer equivalent meets thestandards established by the Participant for direct electronic access or a routing arrangement.
The Market Regulator expects that as part of its initial “screening” process, non-institutional
investors will be precluded from qualifying for direct electronic access except in exceptional
circumstances generally limited to sophisticated former traders and floor brokers or a person orcompany having assets under administration with a value approaching that of an institutional
investor that has access to and knowledge regarding the necessary technology to use directelectronic access. The Participant offering direct electronic access or a routing arrangement
must establish sufficiently stringent standards for each client granted direct electronic access oreach investment dealer or foreign dealer equivalent under a routing arrangement to ensure that
the Participant is not exposed to undue risk and in particular, in the case of a non-institutional
client the standards must be set higher than for institutional investors.
The Participant is further required to confirm with the client granted direct electronic access oran investment dealer or foreign dealer equivalent in a routing arrangement, at least annually,that the client, investment dealer or foreign dealer equivalent continues to meet the standards
established by the Participant including to ensure that any modification to a previously“approved” automated order system in use by a client, investment dealer or foreign dealer
equivalent continues to maintain appropriate safeguards.
Breaches by Clients with Direct Electronic Access or by Investment Dealers or Foreign
Dealer Equivalents in a Routing Arrangement
A Participant that has granted direct electronic access to a client or entered into a routing
arrangement with an investment dealer or foreign dealer equivalent must further monitor orders
entered by the client, investment dealer or foreign dealer equivalent to identify whether theclient, investment dealer or foreign dealer equivalent may have:•breached any standard established by the Participant for the granting of direct electronic
access or a routing arrangement;

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UMIR 7.1-11

•

breached the terms of the written agreement regarding the direct electronic access or
the routing arrangement;•

improperly granted or provided its access under direct electronic access or a routing
arrangement to another person;•

engaged in unauthorized trading on behalf of the account of another person; or•failed to ensure that its client’s orders are transmitted through the systems of the client,or Participant, investment dealer or foreign dealer equivalent (which include proprietarysystems or systems that are provided by a third party) before being entered on amarketplace.
Identifying Originating Investment Dealer or Foreign Dealer Equivalent

In relation to the assignment of a unique identifier to an investment dealer or foreign dealer
equivalent in a routing arrangement, if orders are routed through multiple investment dealers or
foreign dealer equivalents, the executing Participant is responsible for properly identifying theoriginating investment dealer or foreign dealer equivalent and must establish and maintainadequate policies and procedures to assure that orders routed by an investment dealer or
foreign dealer equivalent to the executing Participant containing the Participant’s identifier are
also marked with all identifiers and designations relevant to the order as required under Rule 6.2of UMIR on the entry of the order to a marketplace.
Identifying Clients with Direct Electronic AccessIn relation to the assignment of a unique identifier to a client that is granted direct electronic
access, the Participant must establish and maintain adequate policies and procedures to assurethat orders routed by the client to the executing Participant containing the Participant’s identifier
are marked with all identifiers and designations relevant to the order as required under Rule 6.2of UMIR on the entry of the order to a marketplace.

Part 10 – Specific Procedures Respecting Audit Trail and Record Retention
Requirements
Each Participant must develop, implement and maintain a supervision system to ensure that an
accurate and complete audit trail of orders and trades under Rule 10.11 and Rule 10.12 isrecorded and maintained.
At a minimum, policies and procedures regarding audit trail requirements must ensure theaccurate recording of the following information for each order and trade as applicable:•date and time of entry, amendment, cancellation, execution and expiration•

quantity•

buy, sell or short-sale marker•

market or limit order marker•

price (if limit order)•

name or symbol of security or derivative•

identity of order recipient or trader•

client name or account number and special client instructions

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UMIR 7.1-12

•client consent•

applicable designations and identifiers under Rule 6.2 (identifier would allow complianceand regulators to track the history of the order, from time of order entry to execution or
expiration)•

for CFOd orders, subsequent time of entry and quantity or price changes.

Sample sets must be randomly selected to proportionately cover orders and trades related to
all lines of business of a Participant. Reviews for compliance with Audit Trail Requirements must
be carried out at least on a quarterly basis and reviews for compliance with Record Retention
Requirements must be carried out at least annually.
Part 11– Specific Procedures Respecting Order Handling
Each Participant must develop, implement and maintain a supervision system to ensure that its
trading does not violate order exposure requirements under Rule 6.3 or client priority
requirements under Rule 8.1. Reviews for compliance with these provisions must at a minimum
include:•verifying that client orders of 50 standard trading units or less are not withheld from themarket without a valid exemption from order exposure rule•

reviewing client-principal trades of 50 standard trading units or less with a trade value of$ 100,000 or less for compliance with client-principal rules.

Each Participant must review the order entry and trading described above at least quarterly.
Part 12–Specific Provisions Respecting Grey List and Restricted Securities
Each Participant must develop, implement and maintain a supervision system to review
securities:• about which a Participant may have non-public information (e.g. Grey or Watch list)• subject to trading restrictions with respect to Rule 7.7 or any other Requirement (e.g.
Restricted List)• trading outside Canada during Regulatory halts, delays and suspensions (e.g.CTO
halts).
Policies and procedures designed to monitor trading around Grey and Restricted list securities
must consider:• insider trading requirements under subsection 76.(1) of Securities Act (Ontario) andsimilar provisions that prohibit a person or company in a special relationship with areporting issuer from purchasing or selling such securities with knowledge of a materialchange that has not been generally disclosed• OSC Policy 33-601- Guidelines for Policies and Procedures Concerning Insider
Information.
Each Participant must review the trading described above on a daily basis.
Part 13– Specific Provisions Respecting Client Disclosures
Each Participant must develop, implement and maintain a supervision system

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UMIR 7.1-13

to verify that appropriate trade disclosures are made on client confirmations. To comply with
Corporation rules, such disclosures must include:• the quantity and description of the security purchased or sold• whether or not the person or company that executed the trade acted as principal oragent• the consideration of the trade (may include average price of the security traded)• the related issuers of the security traded• the date of the trade and name of the marketplace on which the transaction took place (ifapplicable, Participants may use a general statement that the transaction took place on
more than one marketplace or over more than one day)• the name of the salesperson responsible for the transaction• the settlement date of the trade.
Each Participant must review a sample of trade confirmations at least on a quarterly basis.
Part 14 - Specific Provisions Applicable to Normal Course Issuer Bids (“NCIBs”) andSales from Control Blocks
Each Participant must develop, implement and maintain a supervision system
to review NCIB-related trading to ensure:• maximum daily and annual stock purchase limits are observed• purchases for NCIBs do not occur while a sale from control for the same security is ineffect• NCIB purchases are not made on upticks• NCIB trade reporting to Exchange (if the firm reports on behalf of issuer).
Each Participant must review trading related to NCIBs described above at least quarterly.
Supervisory policies and procedures must also be designed to review trading related to sales
from control blocks. Such reviews must be carried out as when determined necessary by theParticipant and must include:• reviewing of all known sales from control blocks to ensure regulatory requirements havebeen met• sampling of large trades to determine if they are undisclosed sales from a control block.
Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
NI 21-101 section 1.1 – “ATS”, “order” and “self-regulatory entity”
NI 21-101 section 1.4 – Interpretation -- “security”
NI 23-101 section 1.1 – “directed-action order” and “trade-through”
NI 23-103 section 1 – “automated order system”
NI 31-103 section 1.1 – “investment dealer”
UMIR section 1.1 – “Access Person”, “client order”, “derivative”, “direct electronic access”, “document”,“Electronic Trading Rules”, “employee”, “Exchange”, “foreign dealer equivalent”, “foreign organizedregulated market”, “insider”, “limit order”, “listed security”, “Market Integrity Official”, “Market-on-Close
Order”, “Market Regulator”, “marketplace”, “Marketplace Rules”, “non-client order”, “Participant”, “Policy”,“principal account”, “QTRS”, “related entity”, “Requirements”, “routing arrangement”, “short sale”,“significant shareholder”, “standard trading unit”, “Trading Rules” and “UMIR”
UMIR section 1.2(2) – “person” and “trade”

Related Provisions:

UMIR Policy 1.2 Part 4 – interpretation of “applicable regulatory standards”

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UMIR 7.1-14

UMIR section 6.2
Regulatory History:

Effective April 1, 2005, amendments were made to Policy 7.1 to: Part 1 to clarify supervision requirements(including for direct market access clients) and provide requirements related to post order compliancetesting; Part 2 to update the steps required when a violation is identified; and to add a new Part 5 on
gatekeeper obligations. Clause (2)(a) of Rule 7.1 was also edited. See Market Integrity Notice 2005-011 –“Provisions Respecting Manipulative and Deceptive Activities” (April 1, 2005).
On April 17, 2009, the applicable securities commissions approved an amendment to add Part 6 to Policy
7.1, with retroactive application to May 16, 2008. See IIROC Notice 09-0107 – “Provisions Respecting
the "Best Price" Obligation” (April 17, 2009).
In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved amendments to Rule 7.1 and Part 3 of Policy 7.1 that came into force on June 1,
2008 to make editorial changes. See Footnote 1 in Status of Amendments.
Effective September 12, 2008, the applicable securities commissions approved an amendment to replace
the first paragraph of Part 4 of Policy 7.1. See IIROC Notice 08-0039 – “Provisions Respecting Best
Execution” (July 18, 2008).
Effective February 1, 2011, the applicable securities commissions approved amendments to Rule 7.1 toadd subsection (5) and to Policy 7.1 to repeal and replace Part 6. See IIROC Notice 11-0036 –“Provisions Respecting the Implementation of the Order Protection Rule” (January 28, 2011).
On December 7, 2012, the applicable securities commissions approved amendments to add subsections(6), (7), (8), (9) and (10) to Rule 7.1 and to add Parts 7 and 8 of Policy 7.1 which came into force on March
1, 2013. Parts 1, 2 and 3 of Policy 7.1 were also amended. Please see IIROC Notice 12-0363 –“Provisions Respecting Electronic Trading” (December 7, 2012).
Effective December 9, 2013, the applicable securities commissions approved amendments to the French
version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French version of UMIR”(December 9, 2013).
On July 4, 2013 the applicable securities commissions approved amendments to revise Parts 1 and 2 ofPolicy 7.1 and to add a new Part 9 to Policy 7.1, effective March 1, 2014, to reflect changes related to thirdparty electronic access to marketplaces. See IIROC Notice 13-0184 – “Provisions Respecting ThirdParty Electronic Access to Marketplaces” (July 4, 2013).
Effective January 2, 2018 the applicable securities commissions approved amendments to revise Parts3
and 4 of Policy 7.1 to reflect changes related to best execution. See IIROC Notice 17-0137 –“Amendments Respecting Best Execution” (July 6, 2017).
Effective March 27, 2018 the applicable securities commissions approved amendments to UMIR 7.1. See
IIROC Notice 17-0189 “Amendments Respecting Trading Supervision Obligations” (September 28,
2017)
Effective June 21, 2018 the applicable securities commissions approved housekeeping amendments to
Policy parts 3 and 4. See IIROC Notice 18-0118 – “Housekeeping amendments to the provisions
respecting Trading Supervision Obligations” (June 21, 2018)
Effective December 31, 2021, the applicable securities commissions approved housekeeping amendments
to replace rule references to the Dealer Member Rules with provisions of the IIROC Rules. See IIROC
Notice 20-0042 - Rules Notice – Notice of Approval – UMIR - Housekeeping amendments to UMIR
Following Implementation of IIROC Rules (March 5, 2020).
Effective December 14, 2022, the applicable securities commissions approved amendments to UMIR 7.1
and Policy 7.1. See IIROC Notice 22-0140 – “Amendments Respecting the Trading of Derivatives on aMarketplace” (September 15, 2022).

Repealed Guidance:

See Market Integrity Notice 2003-025 – “Guidelines on Trading Supervision Obligation” (November 28,2003). This Notice was repealed and replaced effective March 27, 2018 by IIROC Notice 17-0190 –“Guidance on Trading Supervision Obligations” (September 28, 2017).

Repealed Guidance:

See Market Integrity Notice 2005-006 – “Obligations of an “Access Person” and Supervision of
Persons with “Direct Access”” (March 4, 2005). This Market Integrity Notice was repealed and replaced
effective March 1, 2014 by IIROC Notice 13-0185 – “Guidance Respecting Third-Party Electronic
Access to Marketplaces” (July 4, 2013).

Repealed Guidance:

See Market Integrity Notice 2006-023 – “The Role of Compliance and Supervision” (November 30,2006). This Notice was repealed and replaced effective January 2, 2018 by IIROC Notice 17-0190 Guidance on Trading Supervision Obligations (September 28, 2017).

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Repealed Guidance:

See Market Integrity Notice 2007-010 – “Compliance Requirements for Dealer-Sponsored Access”(April 20, 2007). This Market Integrity Notice was repealed and replaced effective March 1, 2014 by IIROC
Notice 13-0185 – “Guidance Respecting Third-Party Access to Electronic Marketplaces Guidance”(July 4, 2013).

Guidance:

See Market Integrity Notice 2007-011 – “Compliance Requirements for Order-Execution Services”(April 20, 2007).

Partially Repealed Guidance: See Market Integrity Notice 2007-015 – “Specific Questions Related to Trading on Multiple
Marketplaces” (August 10, 2007). Questions 5, 8, 9 and 12 in MIN 2007-015 were repealed and replaced
effective May 16, 2008 by Market Integrity Notice 2008-010 – “Guidance – Complying with “Best Price”
Obligations” (May 16, 2008). Questions 7, 8 and 10 of MIN 2007-015 were partially repealed effective
January 2, 2018 by IIROC Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).
Repealed Guidance:

See Market Integrity Notice 2008-003 – “Supervision of Algorithmic Trading” (January 18, 2008). This
Market Integrity Notice was repealed and replaced effective March 1, 2013 by IIROC Notice 12-0364 –“Guidance Respecting Electronic Trading” (December 7, 2012).

Repealed Guidance:

See IIROC Notice 09-0081 – “Specific Questions Related To Supervision of Algorithmic Trading”(March 20, 2009). This IIROC Notice was repealed and replaced effective March 1, 2013 by IIROC Notice12-0364 – “Guidance Respecting Electronic Trading” (December 7, 2012).

Partially Repealed Guidance: See IIROC Notice 11-0043 – “Guidance on “Locked” and “Crossed” Markets” (February 1, 2011).
Questions 2, 5 and 9 of Notice 11-0043 were repealed and replaced effective January 2, 2018 by IIROC
Notice 17-0138 – “Guidance on Best Execution” (July 6, 2017).
Repealed Guidance:

See IIROC Notice 11-0114 – “Guidance Respecting the Use of Certain Order Types” (March 30, 2011).
This Notice was repealed and replaced effective January 2, 2018 by IIROC Notice 17-0138 – “Guidanceon Best Execution” (July 6, 2017).

Guidance:

See IIROC Notice 12-0364 – “Guidance Respecting Electronic Trading” (December 7, 2012).

Guidance:

See IIROC Notice 13-0053 – “Guidance on Certain Manipulative and Deceptive Trading Activities”(February 14, 2013).

Guidance:

See IIROC Notice 13-0185 – “Guidance Respecting Third-Party Electronic Access to Marketplaces”(July 4, 2013).

Guidance:

See IIROC Notice 13-0191 – “Guidance Respecting the Management of Stop Loss Orders” (July 11,2013).

Repealed Guidance:

See Market Integrity Notice 2003-025 – “Guidelines on Trading Supervision Obligation” (November 28,2003) and Market Integrity Notice 2006-023 – “The Role of Compliance and Supervision” (November
30, 2006). These Market Integrity Notices were repealed and replaced effective March 27, 2018 by IIROC
Notice 17-0190 – “Guidance on Trading Supervision Obligations” (September 28, 2017).

Guidance:

IIROC Notice 17-0190 – “Guidance on Trading Supervision Obligations” (September 28, 2017).

Partially Repealed Technical Notice: See IIROC Notice 13-0290 – “Gatekeeper and Notice Requirements For Direct
Electronic Access and Routing Arrangements” (December 3, 2013). Part A of this Notice in reference toRule 7.13(6): Notification of DEA or Routing Arrangement was repealed and replaced effective July 26,
2021 by IIROC Notice 21-0099 – “Use of Identifiers and Notification Requirements Respecting Certain
Order Execution Only and Direct Electronic Access Clients and Advisers” (May 25, 2021).
Guidance:

See IIROC Notice 21-0099 – “Use of Identifiers and Notification Requirements Respecting Certain
Order Execution Only and Direct Electronic Access Clients and Advisers” (May 25, 2021).

Disciplinary Proceedings:

In the Matter of Dominick & Dominick Securities Inc. (“Dominick”) (December 19, 2002) OOS
2002-009
Facts – During the period of July 1, 1998 to February 1, 1999, an investment advisor at Dominick, in thecourse of acting for a company engaged in a normal course issuer bid, failed to exercise due diligencein relation to the entry of orders by the company for the purchase of its shares, including from accounts
related to or affiliated with the company and its insiders.
Disposition – Dominick failed to ensure that its employee carried out the issuer bid in compliance withexchange requirements, and failed to exercise due diligence in relation to the entry of orders by thecompany for the purchase of its shares.
Requirements Considered – VSE Policy 21.10, VSE Rules F.1.01(1)(b) and B.4.16, VSE By-law
5.01(2). Comparable UMIR Provision - Rule 7.1 and Policy 7.1, reference made to “gatekeeper
function” (Rule 10.16 effective April 1, 2005).
Sanction - $25,000 fine and costs of $5,000; disgorgement of $2,392 in gains.

Disciplinary Proceedings:

In the Matter of Georgia Pacific Securities Corporation (“Georgia”) (August 18, 2003) OOS 2003004

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Facts – Between February 1999 and November 1999, an investment advisor employed by Georgia
engaged in a pattern of non-economic trading in client accounts which had a pre-existing debit positionsin their accounts. The investment advisor engaged in the practice of buying, and immediately thereafter
selling the same share positions in clients’ accounts for the sole purpose of causing the clients’ accountdebit position to be re-aged, thereby postponing payment for the debits in the clients’ accounts.
Disposition – The Georgia board of directors was responsible for overall stewardship of supervision andcompliance at the firm with specific responsibility to ensure that its employees and officers comply withregulatory requirements. The board failed to establish and apply prudent supervisory and compliance
procedures to ensure that its employees adhered to regulatory and exchange requirements.
Requirements Considered – VSE By-laws 5.07(1) and 5.01(2), VSE Rules F.2.28, F.2.08 and F.1.01.
Comparable UMIR Provision - Rule 7.1 and Policy 7.1.
Sanction - $35,000 fine and costs of $5,000; disgorgement of $21,105 in gains.
Disciplinary Proceedings:

In the Matter of Edward Dean Duggan (“Duggan”) (August 18, 2003) OOS 2003-005
Facts – Between February 1999 and November 1999, Darren Hunter Bell (“Bell”) an investment adviser
at Georgia Pacific Securities Corporation (“Georgia”) engaged in a pattern of non-economic trading on
behalf of four client accounts whereby he bought and immediately thereafter sold shares of highly liquid
securities for clients’ accounts with the sole purpose of causing clients’ debit positions to be re-aged,
thereby postponing payment for the debits in the clients accounts’.
Disposition – As the senior officer of Georgia, Duggan bore responsibility for the conduct of Georgia’s
business and its management, including ensuring that Georgia’s compliance procedures were effective.
Duggan failed to diligently supervise or ensure supervision of accounts handled by Bell and failed toestablish prudent business and compliance procedures to ensure that Georgia and its employees
carried out business in compliance with regulatory requirements.
Requirements Considered – VSE By-laws 5.07(2) and (3) and 5.01(2), VSE Rules F.2.08 and F.1.01.
Comparable UMIR Provision - Rule 7.1 and Policy 7.1.
Sanction - $20,000 fine and costs of $5,000; suspension from acting in a supervisory capacity for 1
year.

Disciplinary Proceedings:

In the Matter of Roger Brian Ashton (“Ashton”) (August 18, 2003) OOS 2003-006
Facts – Between February 1999 and November 1999, Darren Hunter Bell (“Bell”) an investment adviser
at Georgia Pacific Securities Corporation (“Georgia”) engaged in a pattern of non-economic trading on
behalf of four client accounts whereby he bought and immediately thereafter sold shares of highly liquid
securities for client’s accounts with the sole purpose of causing clients’ debit positions to be re-aged,
thereby postponing payment for the debits in the clients accounts’.
Disposition – As the senior officer of Georgia, Ashton bore responsibility for the conduct of Georgia’s
business and its management, including ensuring that Georgia’s compliance procedures were effective.
Ashton failed to diligently supervise or ensure supervision of accounts handled by Bell and failed toestablish prudent business and compliance procedures to ensure that Georgia and its employees
carried out business in compliance with regulatory requirements.
Requirements Considered – VSE By-laws 5.07(2) and (3) and 5.01(2), VSE Rules F.2.08 and F.1.01.
Comparable UMIR Provision - Rule 7.1 and Policy 7.1.
Sanction - $30,000 fine and costs of $5,000; suspension from acting in a supervisory capacity for 1
year.

Disciplinary Proceedings:

In the Matter of Canaccord Capital Corporation (“Canaccord”) (October 28, 2003) OOS 2003-007
Facts – Client X, a director of Tree Brewing Co. Ltd. (“Tree Brewing”), a Vancouver Stock Exchange
listed issuer, controlled a number of accounts at Canaccord. Between August 1, 1998 and March 31,
1999, client X engaged in a pattern of uneconomic and repetitive trading in Tree Brewing which
involved the sale and subsequent re-purchase of a comparable number of shares for the purpose ofdeferring payment for the securities traded.
Disposition – Canaccord failed to closely monitor trading by the insider, to use due diligence to learn theessential facts concerning each order accepted by its trader and to diligently supervise its traders.
Requirements Considered – VSE Rules F.2.08 and F.1.01(1). Comparable UMIR Provision - Rule 7.1
and Policy 7.1
Sanction - $12,500 fine and costs of $3,000; disgorgement of $7,090.02 in gains

Disciplinary Proceedings:

In the Matter of Matthew Philip Linden (“Linden”) (November 26, 2003) OOS 2003-012
Facts – Between February 1 and July 5, 2000, Linden, the branch manager was responsible for thesupervision of 26 employees, including John Scott (“Scott”), an investment advisor at the branch.
During this period, the Retail Compliance Department of the dealer identified what appeared to besuspicious trading in the client accounts managed by Scott and also revealed an unusually highPart 7 – Trading in a Marketplace
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UMIR 7.1-17

portfolio concentration of one specific private placement in each of these clients’ accounts. The RetailCompliance Department sent five inquiries to Linden alerting him of trading anomalies and other “redflags” associated with these clients’ accounts. In all instances Linden questioned Scott about thecompliance inquiries, and in all instances accepted Scott’s explanations, concluding that no further
investigation or follow-up was required.
Disposition – As branch manager, Linden was responsible for supervision of all retail trading at thebranch. The inquiries received from the Retail Compliance Department should have heightened
Linden’s review of the clients’ accounts and caused him to investigate further rather than just relying on
the answers provided by Scott to the Retail Compliance inquiries. In this regard, Linden failed in his
supervisory responsibilities as branch manager.
Requirements Considered – Section 8.34 of the General By-law of the TSX and TSX Rule 2-401(4).
Comparable UMIR Provision - Rule 7.1 and Policy 7.1.
Sanction – $50,000 fine and costs of $12,500; successful completion of the Branch Manager
examination.
Disciplinary Proceedings:

In the Matter of Canaccord Capital Corporation (“Canaccord”) (December 5, 2003) OOS 2003-013
Facts – Canaccord employed Kai Tolpinrud (“Tolpinrud”) to trade for institutions and quasi-institutional
clients, and corporate clients and at the same time permitted him to trade his personal account andinventory accounts. In reliance on this arrangement, between March 1, 2001 and March 11, 2002
Tolpinrud took advantage of client orders and information when acting as agent for the purchase andsale of securities to commit numerous infractions and contraventions including frontrunning, trading
opposite his clients, improper client-principal trading and failing to give client orders priority when heentered client and non-client orders. Also, notwithstanding that Tolpinrud was not registered to trade on
the CDNX, Canaccord allowed him to enter orders from another trader’s terminal.
Disposition – By allowing an arrangement which was prone to a heightened conflict of interest,
Canaccord should have known that a high degree of diligence and greater level of supervision was
required. Canaccord failed to establish and maintain an appropriate supervisory system to ensure thatthe handling of client business, inventory trading and pro trading by Tolpinrud was within the bounds of
ethical conduct and consistent with just and equitable principals of trade.
Requirements Considered – CDNX Rules F.2.22, F.2.03 and G.3.01(6); TSX Rules 2-401, 2-404(2) and
4-405(1). Comparable UMIR Provision – Rule 7.1 and Policy 7.1.
Sanction – $50,000 fine and costs of $43,000; undertaking to review and implement changes to existing
compliance and supervisory systems; other undertakings.

Disciplinary Proceedings:

In the Matter of HSBC Securities (Canada) Inc. (“HSBC”) (August 23, 2004) SA 2004-005
Facts – A 2001 trade desk review conducted by RS of HSBC’s trade desk uncovered numerous
deficiencies. HSBC was required to remedy the deficiencies and undertake to complete monthly andquarterly reviews – the results of which were to be submitted to RS for review. During a follow-up audit
by the RS trade desk review team in 2003, a number of the items identified in the 2001 audit continued
to remain unresolved and new issues were identified. HSBC represented to RS that it would redraft its
trade review procedures to address the issues identified, and that such procedures would include daily,
monthly and quarterly reviews. During a 2004 review, it was discovered that HSBC failed to adhere toits commitment concerning quarterly reports and that quarterly reviews were not conducted by HSBC
between January and December 2003. The 2004 trade desk review also found unresolved deficiencies
that were identified in the 2001 and 2003 trade desk reviews.
Disposition – The Board of Directors, Senior Management and the Compliance Department did notmeet their respective supervisory obligations. The continued failure of HSBC to identify and address theissues identified by RS during its various trade desk reviews evidenced a Board of Directors and senior
management team that were ineffective in their supervisory responsibilities.
Requirements Considered – Rule 7.1(1) and Policy 7.1.
Sanction – $625,000 fine and costs of $87,500; implementation of changes recommended by anindependent consultant and RS.

Disciplinary Proceedings:

Rule 7.1(1) and Policy 7.1 were considered In the Matter of UBS Securities Canada Inc. (“UBS
Canada”) (October 8, 2004) SA 2004-006. See Disciplinary Proceedings under Rule 2.2.

Disciplinary Proceedings:

Rule 7.1 and Policy 7.1 were considered In the Matter of CIBC World Markets Inc., (“CIBC”) Scott
Mortimer and Carl Irizawa (December 21, 2004) SA 2004-008. See Disciplinary Proceedings under
Rule 2.1.

Disciplinary Proceedings:

Rule 7.1 and Policy 7.1 were considered In the Matter of Salman Partners Inc. (“Salman”), Sameh
Magid (“Magid”), William Burk (“Burk”) and Ian Todd (“Todd”) (February 18, 2005) SA 2005-001.
See Disciplinary Proceedings under Rule 3.1.

Disciplinary Proceedings:

Rule 7.1 and Policy 7.1 were considered In the Matter of Desjardins Securities Inc. (“Desjardins”),

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Jean-Pierre De Montigny (De Montigny”) and Jean-Luc Brunet (“Brunet”) (March 16, 2005) SA
2005-002. See Disciplinary Proceedings under 5.3.
Disciplinary Proceedings:

In the Matter of Zoltan Horcsok (“Horcsok”) (July 18, 2005) SA 2005-003
Facts – During the relevant period, Horcsok was the Executive Director, Head of Sales Trading at UBS
Securities Canada Inc. (“UBS Canada”) and was responsible for the supervision of 12 sales traders in
the Toronto and Montreal offices. In February of 2005, with Horcsok’s knowledge, an employee, overwhom Horcsok had supervisory authority altered a trade ticket (which Horcsok subsequently
destroyed), entered false information on an electronic trade ticket and created false and misleading“chat” communication in an effort to conceal trading improprieties conducted by a trader at a U.S.
affiliate of UBS Canada.
Disposition – By involving an employee over whom he had supervisory responsibility in the attempted
concealment of trading improprieties conducted by a trader at UBS’s U.S. affiliate and for his role indestroying a trade ticket, deliberately conducting telephone conversations with the U.S. broker on
untaped telephone lines and misleading UBS Canada’s compliance department in its investigation of
the matter, Horcsok contravened his supervisory obligations and engaged in conduct that resulted in
UBS Canada violating certain audit trail requirements under UMIR.
Requirements Considered – Rules 7.1(4), 10.3(4), 10.11(1) and 10.12(1).
Sanction – $100,000 fine and costs of $25,000; suspension from RS regulated marketplaces for 3
months; 6 months strict supervision; prohibited from acting as supervisor for 1 year.

Disciplinary Proceedings:

In the Matter of Mark Ellis (“Ellis”) (October 19, 2005) DN 2005-008
Facts – On September 17, 2003, RS contacted a trader trainee at Dundee Securities Corporation(“Dundee”) concerning non-client orders that he had entered on both sides of the market in a particular
security in the pre-opening session of the TSX prior to 9:28 a.m. RS advised the trader to “cease anddesist” from this type of activity. Ellis, who along with another Dundee employee, was responsible foroverseeing and supervising traders at Dundee, was made aware of the substance of RS’s concerns.
Ellis cautioned the trader to discontinue such conduct, but did not take steps to enquire whether any
other traders at the firm engaged in similar conduct, nor did he escalate the matter to the firm’s
Compliance Department or senior management as required by Dundee’s policies and procedures. It
was subsequently discovered that another trader trainee and trader at Dundee engaged in similar
conduct between July and December 2003 and October 2003 and February 2005, respectively.
Disposition – It is incumbent upon employees in supervisory roles at a Participant to fulfill their own
supervisory duties and to follow their firm’s policies and procedures relating to reporting trading issues
to the Compliance Department. Ellis did not fully comply with his trading supervision obligations.
Requirements Considered – Rule 7.1(4).
Sanction – $15,000 fine and costs of $6,000.

Disciplinary Proceedings:

In the Matter of Keith Leslie Leonard (“Leonard”) (October 19, 2005) DN 2005-008
Facts – On September 17, 2003, RS contacted a trader trainee at Dundee Securities Corporation(“Dundee”) concerning non-client orders that he had entered on both sides of the market in a particular
security in the pre-opening session of the TSX prior to 9:28 a.m. RS advised the trader to “cease anddesist” from this type of activity. Leonard, who along with another Dundee employee, was responsible
for overseeing and supervising traders at Dundee, was made aware of the substance of RS’s concerns.
Leonard cautioned the trader to discontinue such conduct, but did not take steps to enquire whether
any other traders at the firm engaged in similar conduct, nor did he escalate the matter to the firm’s
Compliance Department or senior management as required by Dundee’s policies and procedures. It
was subsequently discovered that another trader trainee and trader at Dundee engaged in similar
conduct between July and December 2003 and October 2003 and February 2005, respectively.
Disposition – It is incumbent upon employees in supervisory roles at a Participant to fulfill their own
supervisory duties and to follow their firm’s policies and procedures relating to reporting trading issues
to the Compliance Department. Leonard did not fully comply with his trading supervision obligations.
Requirements Considered – Rule 7.1(4).
Sanction – $15,000 fine and costs of $6,000.

Disciplinary Proceedings:

Rule 7.1 was considered In the Matter of Union Securities Ltd. (“Union”) (April 18, 2006) DN 2006004. See Disciplinary Proceedings under Rule 6.2.

Disciplinary Proceedings:

In the Matter of Research Capital Corporation (“Research”) (April 25, 2006) DN 2006-005
Facts – Between September 1, 2002 and May 31, 2003, and between November 1, 2003 and January
12, 2004 an investment advisor at Research participated in his clients’ use of manipulative methods of
trading in connection with the purchase and sale of a TSXV listed security which involved a pattern oftrading which was not consistent with a bona fide effort to accumulate shares of the security over timeand represented an overall pattern of trading at prices higher than would otherwise been dictated byPart 7 – Trading in a Marketplace
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UMIR 7.1-19

market forces.
Disposition – In failing to supervise the investment advisor and failing to adopt systems and procedures
which were adequate to assist its supervisory and compliance personnel in detecting patterns ofimproper or unusual trading in client accounts, Union failed to comply with its trading supervisionobligations under UMIR.
Requirements Considered – Rule 7.1 and Policy 7.1
Sanction - $16,260 fine and costs of $135,000; certification by Research that it has extended theimplementation of the recommendations made in a March 20, 2005 consultant’s report and that it has
implemented effective supervision and compliances procedures to identify and address manipulativeand deceptive trading and monitor of trading through its order management system for compliance with
UMIR.
Disciplinary Proceedings:

Rule 7.1(1), 7.1(4) and Policy 7.1 were considered In the Matter of Raymond James Ltd. (“RaymondJames”) and Marc Deslongchamps (“Deslongchamps”) (June 30, 2006) DN 2006-006. See
Disciplinary Proceedings under Rule 5.3.

Disciplinary Proceedings:

In the Matter of Standard Securities Capital Corporation (“Standard”) (July 6, 2006) DN 2006-008
Facts – Between April 2002 and April 2004 RS conducted 3 separate trade desk reviews (“TDRs”) of
Standard’s trade desk policies, procedures and practices, and in each case identified and reported toStandard that its trading policies and procedures failed to adequately address Standard’s requirements
respecting its supervisory and compliance obligations under UMIR. In particular, the TDRs revealed thatthe policies and procedures failed to adequately ensure compliance with the client priority rule, describe
how Standard would conduct compliance testing and how issues identified during the testing would bereported to management. Standard also failed to maintain adequate evidence that it conductedcompliance testing and failed to review its trading policies and procedures annually as required by
UMIR.
Disposition – Despite the deficiencies noted by the TDR group, Standard failed to adopt written policies
and procedures to be followed by its directors, officers, partners and employees that were adequate,
taking into account Standard’s business and affairs, to ensure compliance with UMIR Rules andPolicies.
Requirements Considered – Rule 7.1 and Policy 7.1.
Sanction – $80,000 fine and costs of $20,000.

Disciplinary Proceedings:

Rule 7.1(1) and Policy 7.1 were considered In the Matter of TD Securities Inc, (“TDSI”) (July 5,2006) DN 2006-007. See Disciplinary Proceedings under Rule 5.1

Disciplinary Proceedings:

Rule 7.1 and Policy 7.1 were considered In the Matter of Michael Bond (“Bond”) and Sesto DeLuca(“DeLuca”) (June 4, 2007) DN 2007-003. See Disciplinary Proceeding under Rule 2.2.

Disciplinary Proceedings:

Rule 7.1 and Policy 7.1 were considered In the Matter of Golden Capital Securities Ltd. (“Golden”),
Jack Finkelstein (“Finkelstein”) and Jeff Rutledge (“Rutledge”) (November 23, 2007) DN 2007004. See Disciplinary Proceeding under Rule 6.2.

Disciplinary Proceedings:

In the Matter of Northern Securities Inc. (“Northern”) (May 30, 2008) DN 2008-002
Facts - Trade desk reviews conducted by RS in the fall of 2003 and 2004 at Northern found insufficient
supervision of certain trading practices and compliance testing policies and procedures. The trade desk
reviews also found several UMIR deficiencies, most notably related to audit trail and order entry
designation. During a follow-up audit by the RS trade desk review team in 2005, RS noted some
improvements in Northern’s testing procedures and other compliance and supervision issues, however,
several deficiencies, namely related to the failure to document compliance and internal testing at
Northern remained unresolved.
Disposition – In failing to implement and update its written trading supervision and compliance policies
and procedures and failing to ensure proper internal compliance testing, including maintaining evidenceof such testing, Northern contravened Rule 7.1 and Policy 7.1 of UMIR.
Requirements Considered – Rule 7.1 and Policy 7.1
Sanction – $125,000 fine and costs of $50,000.

Disciplinary Proceedings:

Rule 7.1 was considered In the Matter of Francesco Mauro (“Mauro”) and Scott Fraser Harding

Disciplinary Proceedings:

Rule 7.1 was considered In the Matter of Magna Partners Ltd. (“Magna”) (November 16, 2010) DN
10-0295. See Disciplinary Proceedings under Rule 5.2.

Disciplinary Proceedings:

In the Matter of TD Securities Inc. (“TDSI”), Kenneth Nott (“Nott”), Aidin Sadeghi (“Sadeghi”),
Christopher Kaplan (“Kaplan”), Robert Nemy (“Nemy”) and Jake Poulstrup (“Poulstrup”)(collectively, the “Individual Respondents”) (December 20, 2010) DN 10-0338(“Harding”) (May 25, 2010) DN 10-0149. See Disciplinary Proceedings under Rule 2.2

Facts – The Individual Respondents were all TSX Registered Traders hired by TDSI to work as

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Inventory Traders (also called Proprietary Traders). Between May 1 to October 31, 2005 (the “Relevant
Period”), each of the Individual Respondents entered high closing bids on either NEX, TSX-V or TSX topurchase one or more of five illiquid stocks (collectively, the “Five Stocks”). The collective trading
pattern of the Individual Respondents revealed that orders in the illiquid stocks were placed very late in
the day in small lots that set the closing bids day after day, week after week, and month after month.
TDSI had at its disposal a number of display “tools” that could be selected to assist in monitoring andsupervising the traders, however, there was no tool available in the Relevant Period to monitor real timeorders (i.e. bids and offers). TDSI was only provided with reports (e.g. high month end closings) that did
not include any information regarding bids and offers. Consequently, TDSI did not have a systematic
procedure to review orders.
Disposition – An artificial bid price results when there is an intention to establish a price that is notjustified by real demand or supply in a security. In the Relevant Period, the Individual Respondents
made closing bids in the context of the market with the intention that the bids would not trade but
instead would stand as the closing bid at the end of the trading day thereby increasing the value of theirinventory positions (which were calculated on the basis of the closing bids) and increasing theircompensation and access to capital. The circumstantial evidence of motive and trading patterns (thefrequency of setting the closing bids, late time of the closing bid orders, bidding in small lots and theilliquid nature of the stocks), supported an inference on a balance of probabilities that the Individual
Respondents intended to engage in the improper practice of entering artificial closing bids in the Five
Stocks. This finding was buttressed by direct evidence of instant messages and telephone calls
between the Individual Respondents which showed concern for monthly ranking, the value of theadjusted cost base in a month other than a pay period month end and a willingness to manipulate themarket for personal reasons. In the Relevant Period, Nott entered 230 artificial closing bids; Sadeghi
entered 3 artificial closing bids; Kaplan entered 37 artificial closing bids; Nemy entered 38 artificial
closing bids; and Poulstrup entered 14 artificial closing bids, all of which were in contravention of UMIR
2.2(2)(b) and UMIR Policy 2.2.
There was no proof, however, that TDSI failed to comply with its UMIR Rule 7.1 and UMIR Policy 7.1
trading supervision obligations and this allegation was dismissed. TDSI did not have a real time
software surveillance system during the Relevant Period to detect the time and sequence of bids andoffers in the marketplace. Demonstrating a pattern of late bids by a trader was one the factors relied onin drawing an inference of artificial closing bids, however the time required to do so was beyond thecapacity of TDSI as the end of the day trading of a stock would have to be printed from the Firm Book
every day for sufficient days to reveal a pattern of late bids. In the circumstances, the random review
approach employed by TDSI was reasonable and realistic. Moreover, TDSI deserved credit for themanner in which it monitored and detected bidding improprieties in one of the Five Stocks and for the
prompt filing of a Gatekeeper Report after the discovery of a wash trade between Nott and Sadeghi.
While there was a fundamental flaw in the TDSI compliance monitoring system employed following theRelevant Period to evaluate whether there had been improper trading, as it had not been configured togenerate alerts for late bids that were below the last sale and thus made within the “context of themarket”, (as was the case with the Individual Respondents), this was due to an honest but erroneousinterpretation of UMIR Policy. The correct interpretation is that the process of bidding within the context
of the market in order to maintain the value of a stock contravenes UMIR and bidding must be inaccordance with true market supply and demand.
Requirements Considered – Rule 2.2(2)(B), 7.1 and Policy 2.2, 7.1.
Sanction – The Hearing Panel determined in the case of all the Individual Respondents that there be noorder of suspension as they had not obtained employment at all, or for a significant period of time, since
September, 2008, and that except for Sadeghi, they be under close supervision for six months, theterms of which would be determined by an employer. Additional penalties and orders were imposed asfollows:•

Nott: (a) a fine of $15,000.00; and (b) costs of $5,000.00.

•

Sadeghi: (a) a fine of $5,000.00. The Hearing Panel noted that there would be no orderfor supervision and strongly recommended that the close supervision order in effect be
rescinded.

•

Kaplan: (a) a fine of $35,000.00; and (b) costs of $15,000.00. In addition, the Hearing
Panel ordered that the trade restrictions in effect cease to apply to Kaplan immediately.

•

Nemy: (a) a fine of $75,000.00; and (b) costs of $37,500.00.

•

Poulstrup: (a) a fine of $20,000.00; and (b) costs of $10,000.00. In addition, the Hearing
Panel ordered that trade restrictions in effect cease to apply to Poulstrup immediately.

Review – IIROC staff filed a Notice of Request for Hearing and Review to the Ontario Securities
Commission (OSC) for a review of the decision of the IIROC Hearing Panel, dated November 30, 2010,
relating to TDSI.
Disposition – The Review application was dismissed by the OSC on July 19, 2013 as there was no errorof law or principle in the IIROC Hearing Panel’s decision. The OSC concluded that the IIROC Hearing
Panel’s statement regarding the erroneous understanding of UMIR was not central to its finding withrespect to TDSI’s supervision of the TDSI traders and noted that the decision makes clear the obligation

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UMIR 7.1-21

of Participants to supervise both trades and orders, including orders that are in the context of themarket, so as to comply with their obligations under UMIR Rule 7.1 and Policy 7.1
Disciplinary Proceedings:

Rule 7.1 was considered In the Matter of National Bank Financial (“NBF”), Paul Clarke (“Clarke”)
and Todd O’Reilly (“O’Reilly”) (January 21, 2011) DN 11-0029 and DN 11-0030. See Disciplinary
Proceedings under Rule 2.1.

Disciplinary Proceedings:

In the Matter of Credit Suisse Securities (Canada) Inc. (“Credit Suisse”) (February 2, 2011) DN
11-0045
Facts – Between May 2007 and October 2007, a monthly review of trading activity for possible
manipulation of security prices at the market’s close was either not conducted within a reasonable
period or at all by Credit Suisse. Credit Suisse also failed to properly scrutinize a particular client’s
Direct Market Access (DMA) account despite the fact that the firm’s artificial pricing reviews had been
generating “red flag warnings” that the DMA account was using algorithms to execute buy orders thatappeared to create artificial prices.
Following inquiry by Market Regulation Services Inc. in late 2007, Credit Suisse advised the DMA client
would no longer place orders near the close of the market and took steps to improve its trading
supervision and compliance monitoring procedures, including implementation of a real-time crossmarket surveillance system, the creation of a Compliance Surveillance Manual, a DMA Client Training
Manual, and a Client Account Opening Procedures Manual.
Disposition – Credit Suisse admitted in a settlement agreement that as a Participant, it is not relieved
from any supervisory obligations pursuant to UMIR 7.1 and UMIR Policy 7.1, and as reaffirmed in,among other things, Market Integrity Notices 2005-006 and 2007-010, with respect to any order that isentered on a marketplace by means of DMA. Credit Suisse further admitted that it failed to comply with
its trading supervision obligations as it did not conduct artificial pricing reviews within a reasonable
period of time for the months of May 2007, June 2007, and July 2007 and did not conduct an artificial
pricing review for October 2007.
Requirements Considered – Rule 7.1 and, Policy 7.1.
Sanction – Credit Suisse agreed to a $150,000 fine and $15,000 in costs.

Disciplinary Proceedings:

Rule 7.1 was considered In the Matter of Beacon Securities Limited. (“Beacon”) (April 8, 2011) DN
11-0120. See Disciplinary Proceedings under Rule 5.2.

Disciplinary Proceedings:

In the Matter of Maison Placements Canada Inc. (“MPCI”) (April 13, 2011) DN 11-0124
Facts – Between December 2008 and January 2011 (the “relevant period”), MPCI was not connected toall of the six protected marketplaces, but only to the TSX and TSXV. MPCI did not use an acceptableorder router nor did it did not provide the order to another Participant for entry on a marketplace. As aresult, MPCI did not consider orders on any of the protected marketplaces other than the TSX or TSXV.
During the period October 2007 to March 2008, MPCI informed its clients that it would execute tradeson the TSX or TSXV only. During the period between December 2008 and October 2010, MPCI
generated trade through alerts; however the percentage of trade through alerts generated was small
relative to MPCI’s overall trading volume. During the relevant period, MPCI did not monitor or review its
order flow for compliance with the “best price” obligation and did not set out the steps or process to befollowed to make “reasonable efforts” to ensure that orders receive the “best price” when executed on amarketplace.
Disposition – Pursuant to a Settlement Agreement, MPCI admitted that it breached UMIR 5.2 and UMIR
Policy 5.2 as it did not make reasonable efforts during the relevant period to ensure orders were
executed at the “best price.” UMIR Requirements make it clear that despite client consent or instructiona Participant cannot trade-through a better bid or offer on a protected marketplace by making a trade at
an inferior price. In addition, MPCI failed to have adequate policies and procedures in place to ensurecompliance with its “best price” obligation, contrary to UMIR 7.1 and UMIR Policy 7.1.
Requirements Considered – Rule 5.2, 7.1 and Policy 5.2, and 7.1.
Sanction – MPCI agreed to pay a fine of $95,000 and costs in the amount of $5,000.

Disciplinary Proceedings:

In the Matter of Morgan Stanley Canada Limited (“Morgan Stanley Canada”) (August 3, 2011) DN
11-0232
Facts – Morgan Stanley Canada provided direct market access (“DMA”) to its U.S. parent company (the“parent”) and the clients of its parent, by extension. Certain UMIR-related compliance testing andreviews were delegated to its parent. Between August 2007 and December 2007 and between July
2008 and December 2008 (the “relevant periods”), a DMA client of the parent generated numerous“pattern alerts” relating to “high closing” on the surveillance system employed by the parent. Inquiries
were made initially by Morgan Stanley Canada and its parent in respect of the trading activities of the
DMA client, however there was ambiguity about how potential contraventions should be documented
and escalated. Alerts generated for part of 2008 were not subject to any additional inquiries or analysis.
Disposition – Morgan Stanley Canada admitted in a Settlement Agreement that in the relevant periods,

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UMIR 7.1-22

it failed to comply with its trading supervision obligations under UMIR 7.1 and UMIR Policy 7.1 byneglecting to take adequate steps to identify and address potentially manipulative trading by a DMA
client that had entered a significant number of “high closing” trades. Testing results for artificial pricing
were not adequately summarized and documented due in part to the failure of Morgan Stanley Canada
to communicate certain UMIR Requirements to its parent. In providing direct market access to IIROCregulated marketplaces, Morgan Stanley Canada retained the ultimate responsibility for any order
entered and to ensure that trading supervision obligations under UMIR were being met.
Requirements Considered – Rule 7.1 and Policy 7.1.
Sanction – Morgan Stanley Canada agreed to a $175,000 fine and $15,000 in costs.
Disciplinary Proceedings:

Rule 7.1 and Policy 7.1 were considered In the Matter of Pope & Company Limited (“Pope”) (March
14, 2012) DN 12-0095. See Disciplinary Proceedings under Rule 5.2.

Disciplinary Proceedings:

In the Matter of BMO Nesbitt Burns Inc. (“BMONB”) (April 13, 2012) DN 12-0136
Facts – A Market-on-Close (“MOC”) order was entered by a trader employed with BMONB on October
13, 2010, that was “clearly erroneous”, and was only discovered by the trader when the Toronto Stock
Exchange (TSX) published the MOC imbalance at 3:40 p.m. that day. The trading application used by
the BMONB trader to enter the erroneous order allowed for pre-trade limits and warning messages tobe set as a safeguard against errors, however these were not enabled at the material time. In addition,
BMONB had no procedures in place to verify that pre-trade filters or limits were activated on the trading
applications used by its traders. For a brief period following the initial publication of the MOC imbalance
the price of the shares experienced its largest decline of the day before rising again. Following entry of
an offsetting limit order into the MOC facility authorized by IIROC, the corrected MOC imbalance waspublished but this did not necessarily reach all market participants who entered orders on the basis of
the original MOC imbalance.
Disposition – Pursuant to a Settlement Agreement, BMONB admitted that it contravened UMIR 7.1 andPolicy 7.1 by failing to adopt adequate policies, procedures and a supervision system sufficient tomanage the risks associated with its trading activities to prevent the submission of erroneous orders,which resulted in the entry of an erroneous order by one of its traders to the TSX MOC facility on
October 13, 2010.
Requirements Considered – Rule 7.1 and Policy 7.1.
Sanction – BMONB agreed to pay a fine of $50,000 and to pay costs in the amount of $5,000.

Disciplinary Proceedings: In the Matter of Alexey Eydelman (“Eydelman”) and Questrade Inc. (“Questrade”) (May 24 2013)
DN 13-0140
Facts – Between August 2009 and February 2010 (the “Relevant Period”), Eydelman, a proprietary
trader employed by Questrade, entered orders on the TSX that established the high closing bid price fora security in circumstances where he ought reasonably to have known the orders could be seen to
create an artificial price. On seven consecutive month-end trading days Eydelman established theclosing bid on the security.
During the Relevant Period, Questrade failed to implement a trade supervision system that was
adequate to ensure compliance with UMIR 2.2 and UMIR Policy 2.2. Questrade also failed to ensurethat the risks associated with its proprietary trading group had been identified and that appropriate
supervision practices and procedures to manage those risks had been implemented. Questrade failed
to adequately review and monitor Eydelman’s order entry activity and failed to prevent or detect
Eydelman’s violations of UMIR 2.2(2).
Disposition – Pursuant to a Settlement Agreement Eydelman admitted that in the Relevant Period, heentered orders on the TSX that he ought reasonably to have known could reasonably be expected tocreate an artificial bid price for the security, contrary to UMIR 2.2 and Policy 2.2. Questrade admitted
that in the Relevant Period, it failed to have adequate policies and procedures in place and asupervision system sufficient to prevent and detect potential artificial bid prices, contrary to UMIR 7.1
and Policy 7.1.
Requirements Considered – Rules 2.2 and 7.1 and Policies 2.2 and 7.1.
Sanction – Eydelman agreed to pay a $30,000 fine, to a suspension of access to IIROC-regulated
marketplaces for 3 months, and to pay costs in the amount of $5,000. Questrade agreed to pay a fine of$70,000, and to pay costs in the amount of $10,000.
Disciplinary Proceedings:

In the Matter of Scotia Capital Inc. (“Scotia Capital”) (June 18, 2013) DN 13-0170
Facts – Between June 2009 and November 2011, Scotia Capital failed to take adequate steps toprevent and detect potential wash trades. Specifically, it lacked adequate policies and procedures forreviewing potential wash trades or failed to properly implement those policies and procedures. The
policies and procedures only required consideration and a review of trades between the same accountnumber. The policies and procedures did not require consideration of trades by the same beneficial
owner with a different account number. Between June 2009 and December 2010, Scotia Capital failed

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UMIR 7.1-23

to take adequate steps to prevent and detect potential artificial pricing transactions. Specifically, it
failed to adequately implement some of its policies and procedures related to the detection of artificial
pricing transactions. As a practice, Scotia Capital only considered two alerts to supervise artificial
pricing and high closing. This practice meant that trades could occur at the end of the day that set theclosing price on an uptick and would go undetected by compliance staff.
Disposition – Pursuant to a Settlement Agreement, Scotia Capital admitted that it failed to comply with
its trading supervision obligations contrary to UMIR 7.1 and Policy 7.1.
Requirements Considered – Rule 7.1 and Policy 7.1.
Sanction – Scotia Capital agreed to pay a $150,000 fine, and to pay costs in the amount of $10,000.
Disciplinary Proceedings:

In the Matter of JitneyTrade Inc. (“JitneyTrade”) (July 23, 2013) DN 13-0196
Facts – Between February and September 2010, and February 2011 and February 2012 (the “Relevant
Period”), JitneyTrade, a registered investment dealer providing Direct Market Access (“DMA”) to IIROCregulated marketplaces to institutional and order-execution clients, was not able to adequately detect,prevent and address potential events of spoofing and layering, and other suspicious trading activities bysome of its DMA clients. JitneyTrade supervised its DMA clients through the review of T+1 reports
which were not adequate to detect and prevent potential patterns of layering and spoofing due to thevolume of trading generated on a daily basis. In addition, JitneyTrade relied in part on the compliancedepartment of a client instead of directly supervising the trading activity of this client.
Disposition – Pursuant to a Settlement Agreement JitneyTrade admitted that in the Relevant Period, it
failed to implement an appropriate trade supervision system reasonably well designed to prevent anddetect violations of UMIR requirements for the size and nature of its DMA clients’ business, contrary to
UMIR 7.1 and Policy 7.1.
Requirements Considered – Rule 7.1 and 2.2, and Policy 7.1 and 2.2.
Sanction – JitneyTrade agreed to pay a $90,000 fine, as well as to pay costs in the amount of $10,000.

Disciplinary Proceedings: In the Matter of Interactive Brokers Canada Inc. (“Interactive Brokers”) (July 25, 2013) DN 13-0197
Facts – Between November 2007 and April 2008 (the “Relevant Period”), Interactive Brokers, aregistered investment dealer, failed to take adequate steps to prevent and detect manipulative anddeceptive trading by a retail client in the shares of a security listed on the TSX Venture Exchange. The
client frequently entered orders (the majority for 100 shares) at or near the close of trading that upticked the prevailing bid. Interactive Brokers lacked adequate policies and procedures for reviewing
potentially manipulative late day order entry that could affect the closing bid or offer which led
Interactive Brokers to fail to prevent and detect the client’s pattern of manipulative late day order entry
in the security. Interactive Brokers did not perform post-trade monitoring and testing of orders for
artificial pricing.
Disposition – Pursuant to a Settlement Agreement, Interactive Brokers admitted that in the Relevant
Period, it failed to comply with its trading supervision obligations contrary to UMIR 7.1 and Policy 7.1.
Requirements Considered – Rule 7.1 and Policy 7.1.
Sanction – Interactive Brokers agreed to pay a $50,000 fine, as well as to pay costs in the amount of$10,000.
Disciplinary Proceedings:

In the Matter of Lakeshore Securities Inc. (“Lakeshore”) (November 11, 2014) DN 14-0262
Facts – Between February 2011 and March 2012 (the “Relevant Period”), Lakeshore entered a new lineof business to provide direct market access (“DMA”) to certain clients. The new DMA businessincreased Lakeshore’s order flow significantly, but Lakeshore failed to take adequate steps to quantify,
summarize and document its trading supervision testing and reporting. In addition, Lakeshore offered
DMA to certain clients who did not meet the financial eligibility requirements set out at the time in Rule
2-501 of the Rules of the Toronto Stock Exchange. UMIR 10.1 requires a Participant to comply with theMarketplace Rules of the marketplace on which the particular order is entered and executed. The
provision of DMA to ineligible clients is also contrary to Lakeshore’s trading supervision obligations
under UMIR 7.1 and Policy 7.1.
Disposition – Pursuant to a Settlement Agreement Lakeshore admitted that in the Relevant Period, it
failed to comply with its trading supervision obligations contrary to UMIR 7.1, UMIR Policy 7.1, UMIR
10.1 and Rule 2-501 of the Rules of the Toronto Stock Exchange.
Requirements Considered – Rule 7.1, Policy 7.1, Rule 10.1 and Rule 2-501 of the Toronto Stock
Exchange.
Sanction – Lakeshore agreed to pay a $20,000 fine, as well as to pay costs in the amount of $5,000.

Disciplinary Proceedings:

In the Matter of M Partners Inc. (“M Partners”) (February 27, 2015) DN 15-0054
Facts – During November 2012 (the “Relevant Period”), M Partners failed to comply with its trading
supervision obligations and to meet its audit trail requirements. During the period, there were significant
audit trail deficiencies and improper order handling practices relating to the firm’s use of accumulationaccounts.

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UMIR 7.1-24

Disposition – Pursuant to a Settlement Agreement M Partners admitted that in the Relevant Period, it
failed to comply with its trading supervision obligations contrary to UMIR 7.1 and Policy 7.1, and failed
on receipt or origination of certain orders to record specific information relating to the orders as required
by Part 11 of the Trading Rules (National Instrument 23-101) contrary to UMIR 10.11(1).
Requirements Considered – Rule 7.1, Policy 7.1, Rule 10.11 and Part 11 of the Trading Rules.
Sanction – M Partners agreed to pay a $40,000 fine and to pay costs in the amount of $5,000.
Disciplinary Proceedings:

In the Matter of Independent Trading Group (ITG) Inc. (“Independent Trading Group”) (May 11,2015) DN 15-0109
Facts – On January 21, 2014, at the open of trading on the TSX, Independent Trading Group’s failure to
employ adequate automated pre-trade controls to limit its financial exposure allowed for the entry of anerroneous order that resulted in an intraday capital deficiency of approximately $8 million. Independent
Trading Group failed to adopt, document and maintain a system of risk management and supervisory
controls, policies and procedures that was adequate to ensure the management of the financial,
regulatory and other risks associated with electronic access to marketplaces.
Disposition – Pursuant to a Settlement Agreement Independent Trading Group admitted that it failed tocomply with its trading supervision obligations contrary to UMIR 7.1(6) and Policy 7.1, Part 7.
Requirements Considered – Rule 7.1(6), Policy 7.1, Part 7.
Sanction – Independent Trading Group agreed to pay a $170,000 fine and to pay costs in the amount of$5,000.

Disciplinary Proceedings:

In the Matter of JitneyTade (“JitneyTrade”) (April 10, 2017) DN 17-0082
Facts – Between September 2013 and October 2014, JitneyTrade failed to implement an effective
trading supervision system and failed to act as a gatekeeper to prevent and detect violations or potential
violations of UMIR 2.2 and UMIR Policy 2.2 by one of its direct electronic access clients.
Disposition – Pursuant to a Settlement Agreement, JitneyTrade admitted that it failed to comply with its
trading supervision obligations to prevent and detect violations of UMIR 2.2 by one of its directelectronic access clients, contrary to UMIR 7.1 and UMIR Policy 7.1.
Requirements Considered – Rule 2.2 and Rule 7.1.
Sanction – JitneyTrade agreed to pay a fine of $200,000, implement remedial measures and to pay
costs in the amount of $25,000.

Disciplinary Proceedings: In the Matter of M Partners Inc. (“M Partners”) and Steven Isenberg (“Isenberg”) (July 12,2018) DN 18-0133
Facts – Between February 2015 and August 2016, M Partners failed to comply with its trading
supervision obligations, contrary to UMIR 7.1 and failed to maintain a proper audit trail by not recording
specific information relating to orders as required by Part 11 of the Trading Rules (National Instrument
23-101), contrary to UMIR 10.11(1).
Between February 2015 and August 2016, Steven Isenberg, as Ultimate Designated Person (“UDP”),
did not take adequate steps to supervise M Partners’ compliance with its regulatory obligations
regarding trading supervision and the maintenance of a proper audit trail and failed to promotecompliance at M Partners, contrary to IIROC Dealer Member Rule 38.5(c).
Disposition – Pursuant to a Settlement Agreement, M Partners admitted it failed to comply with its
trading supervision obligations and failed to maintain a proper audit trail. Isenberg admitted that he did
not take adequate steps to supervise M Partners’ compliance with its regulatory obligations regarding
trading supervision and the maintenance of a proper audit trail, and failed to promote compliance at M
Partners.
Requirements Considered – Rule 7.1, Policy 7.1, Rule 10.11 and Part 11 of the Trading Rules.
Sanction – M Partners agreed to pay a $120,000 fine and to pay costs in the amount of $10,000;
Isenberg agreed to pay a $70,000 fine.
Disciplinary Proceedings:

In the Matter of CIBC World Markets. (“CIBC”) (March 30, 2022), 2022 IIROC 05
Facts – Between September 2019 and July 2020, the Respondent failed to comply with its trading
supervision obligations to maintain a system of risk management and supervisory controls, policies
and procedures reasonably designed, in accordance with prudent business practices, to ensure themanagement of financial, regulatory and other risks associated with the use by its DEA [“directelectronic access”] client of an automated order system contrary to UMIR 7.1, UMIR Policy 7.1 and
UMIR 7.13.
Disposition and Sanction – Pursuant to a Settlement Agreement, CIBC admitted that it contravened
UMIR 7.1, UMIR Policy 7.1 and UMIR 7.13. CIBC agreed to pay a fine of $150,000 and costs of$15,000.

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UMIR 7.1-25

Requirements Considered – Rule 7.1, Policy 7.1, Rule 7.13.
Disciplinary Proceedings:

In the Matter of Instinet Canada (“Instinet”) (June 30, 2020), 2020 IIROC 18
Facts – Between January 2016 and February 2018 (the “Relevant Period”), the Respondent failed tocomply with its trading supervision obligations to prevent and detect potential contraventions of UMIR
2.2 and UMIR Policy 2.2 by one of its direct electronic access clients. In particular, orders wereentered on visible IIROC-regulated marketplaces that changed the best bid price or best ask priceand affected the price at which trades would occur with orders posted in marketplaces where orders
are not visible to marketplace participants.
Disposition and Sanction – Pursuant to a Settlement Agreement, Instinet admitted that it failed, tocomply with its trading supervision obligations to prevent and detect potential contraventions of UMIR
2.2 and UMIR Policy 2.2 by one of its direct electronic access clients, contrary to UMIR 7.1 and UMIR
Policy 7.1. Instinet agreed to a fine of $155,000 and costs of $15,000.
Requirements Considered – Rule 2.2, Policy 2.2, UMIR 7.1 and Policy 7.1.

Disciplinary Proceedings:

In the Matter of Laurentian Bank Securities (“Laurentian”) (April 16, 2020), 2020 IIROC 24
Facts – Between November 2015 and May 2018, the Respondent failed to implement and maintainan adequate trading supervision system and failed to comply with its trading supervision obligations,contrary to UMIR 7.1 and Policy 7.1. In April 2017, the Trading Conduct Compliance Staff of IIROC(TCC Staff) reviewed the trading supervision system of Laurentian Bank Securities Inc. (theRespondent). In the course of their review, TCC Staff noted that the Respondent had not correctedsignificant trading supervision deficiencies identified by TCC Staff in 2015.
Disposition and Sanction – Pursuant to a Settlement Agreement, Laurentian admitted that that it
failed to comply with UMIR 7.1 and Policy 7.1. Laurentian agreed to a fine of $250,000 and costs of$25,000.
Requirements Considered – Rule 7.1 and Policy 7.1.

Disciplinary Proceedings:

In the Matter of Kingsdale Capital (“Kingsdale”) (December 20, 2019), 2019 IIROC 34
Facts – Between January and July 2015, Kingsdale Capital failed to maintain and enforce its
policies and procedures regarding the receipt and containment of confidential information inconnection with the firm’s corporate finance activities, contrary to Dealer Member Rule 38.1 and
UMIR 7.1 and UMIR Policy 7.1
Disposition and Sanction – Pursuant to a Settlement Agreement, Kingsdale admitted that it failed tocomply with trading supervision obligations. Kingsdale agreed to a fine of $45,000 and costs of$5,000.
Requirements Considered – Rule 7.1 and Policy 7.1.

Part 7 – Trading in a Marketplace
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UMIR 7.1-26

Universal Market Integrity Rules

Rules & Policies

7.2

Proficiency Obligations
(1)

(2)

No order to purchase or sell a security or a derivative shall be entered by aParticipant on a marketplace unless the Participant or the director, officer, partner
or employee of the Participant entering the order or responsible for the order has:(a)completed the Trader Training Course of the Canadian Securities Institute orsuch course, examination or other means of demonstrating proficiency in
UMIR and Policies as may be acceptable to the Market Regulator of themarketplace on which the order is entered or the applicable securities
regulatory authority; or(b)received approval of an Exchange or QTRS for the entry of orders to the
trading system of that Exchange or QTRS.

A marketplace shall ensure that each Access Person with access to thatmarketplace is trained in such provisions of UMIR and such Policies as may be
applicable to an Access Person.

Defined Terms:

NI 14-101 section 1.1(3) – “securities regulatory authority”
NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “derivative”, “employee”, “Exchange”, “Market Regulator”,“marketplace”, “Participant”, “Policy”, “QTRS” and “UMIR”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved amendments to Rule 7.2 that came into force on June 1, 2008 to make editorialchanges. See Footnote 1 of Status of Amendments.
Effective December 14, 2022, the applicable securities commissions approved amendments to UMIR
7.2 to expand proficiency obligations to the trading of derivatives on a marketplace. See IIROC Notice22-0140– “Amendments Respecting the Trading of Derivatives on a Marketplace” (September 15,2022).

Part 7 - Trading in a Marketplace
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UMIR 7.2-1

Universal Market Integrity Rules

Rules & Policies

7.3

Liability for Bids, Offers and Trades(1)

All bids and offers for securities or derivatives made and accepted on amarketplace shall be binding and all contracts thereby effected shall be subject tothe exercise by the marketplace on which the trade is executed of the powers
vested in the marketplace and the Market Regulator of that marketplace.

(2)

A Participant shall be responsible for all bids and offers that are entered into, or
arise by operation of the trading system of a marketplace and that originate fromany terminal or computer system allowing access to trading on the marketplacethat is operated by or is under the control of that Participant whether or not theParticipant has authorized the entry of the order.

(3)

Subject to the obligation of an Access Person for compliance with applicableprovisions of UMIR and the Policies, an ATS shall be responsible for all bids andoffers that are entered into, or arise by operation of the trading system of the ATS
and that originate from any terminal or computer system allowing access to tradingon the ATS that is operated by or is under the control of the Access Person of that
ATS whether or not the Access Person has authorized the entry of the order.

Defined Terms:

NI 21-101 section 1.1 – “ATS” and “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “derivative”, “Market Regulator”, “marketplace”, “Participant”,“Policy” and “UMIR”
UMIR section 1.2(2) – “trade”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to Rule 7.3 that came into force on June 1, 2008 to makeeditorial changes. See Footnote 1 of Status of Amendments.
Effective December 14, 2022, the applicable securities commissions approved amendments to UMIR
7.3 to extend the liability for bids, offers and trades to the trading of derivatives. See IIROC Notice 220140– “Amendments Respecting the Trading of Derivatives on a Marketplace” (September 15,2022).

Part 7 - Trading in a Marketplace
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UMIR 7.3-1

Universal Market Integrity Rules

Rules & Policies

7.4

Contract Record and Official Transaction Record(1)

The electronic record of an order or a trade in a security or a derivative as provided
by a marketplace to an information processor or an information vendor inaccordance with the Marketplace Operation Instrument is the official transaction
record for the purpose of determining:(a)best ask price;(b)

best bid price; and(c)last sale price.

(2)

Despite subsection (1), the electronic record of a trade in a security or a derivative
as maintained by the marketplace on which the trade occurred shall be the recordof the contract made on that trade and in the event of a dispute between parties tothe contract or discrepancy with the records of the clearing agency effect shall begiven to the record of the marketplace.

(3)

Each marketplace shall provide to the information processor or information vendor
information respecting each cancellation, variation or correction of a trade as soon
as practicable after the cancellation, variation or correction has been made to therecord of the contract as maintained by the marketplace and the information
processor or information vendor shall amend the transaction record accordingly.

Defined Terms:

NI 21-101 section 1.1 – “information processor” and “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “best ask price”, “best bid price”, “derivative”, “last sale price”, “Market Operation
Instrument” and “marketplace”
UMIR section 1.2(2) – “trade”

Related Provision:

UMIR section 7.11

Regulatory History:

Effective January 30, 2004, the applicable securities commissions approved an amendment tosubsection (1) of Rule 7.4 by inserting the words “an order or” immediately preceding the words “atrade”. See Market Integrity Notice 2004-005 – “Administrative and Editorial Amendments” (January
30, 2004).
Effective December 14, 2022, the applicable securities commissions approved amendments to extend
the requirements under UMIR 7.2 to the trading of derivatives. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September 15, 2022).

Part 7 – Trading in a Marketplace
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UMIR 7.4-1

Universal Market Integrity Rules

Rules & Policies

7.5

Recorded Prices
(1)

(2)

No Participant acting as agent shall execute a transaction through a marketplace inwhich the price recorded on the marketplace is:(a)in the case of a purchase by a client, higher than the net cost to the client; or(b)in the case of a sale by a client, lower than the net proceeds to the client.

No Participant acting as principal shall execute a transaction through amarketplace in which the price recorded on the marketplace is:(a) in the case of a sale to a client,(i)higher than the net cost to the client, or(ii)

lower than the net cost to the client by more than the usual agency
commission that would be charged by that Participant to that client for
an order of the same size; and(b) in the case of a purchase from a client,(i)lower than the net proceeds to the client, or(ii)higher than the net proceeds to the client by more than the usual agency
commission that would be charged by that Participant to that client for
an order of the same size.

POLICY 7.5 - RECORDED PRICES
If the price of:•an internal cross or intentional cross to be recorded on a marketplace; or•a trade that has been executed outside of Canada that is to be reported to amarketplace in accordance with clause (e) of Rule 6.4,

has been agreed to in a foreign currency and the trade is to be recorded or reported in
Canadian currency, the price in foreign currency shall be converted to Canadian dollars using
the exchange rate the Participant would have applied in respect of a trade of similar size on aforeign organized regulated market at the time of the internal cross, intentional cross or
execution of the trade outside of Canada. If the trade price converted into Canadian currency
falls between two trading increments for the marketplace on which the cross is to be entered or
the trade reported, the price shall be rounded to the nearest trading increment. A Participant
shall maintain with the record of the order the exchange rate used for the purpose of entering
the internal cross or intentional cross or reporting the foreign trade and such information shall be
provided to the Market Regulator upon request in such form and manner as may be reasonably
required by the Market Regulator in accordance with Rule 10.11(3).

Part 7 - Trading in a Marketplace
December 9, 2013

UMIR 7.5-1

Defined Terms:

NI 21 101 section 1.1 – “order”
UMIR section 1.1 – “foreign organized regulated market”, “intentional cross”, “internal cross”, “Market
Regulator”, “marketplace”, “net cost”, “net proceeds”, “Participant” and “trading increment”
UMIR section 1.2(2) – “trade”

Related Provisions:

UMIR 6.4, 10.11(3)Regulatory History:

Effective May 16, 2008, the applicable securities commissions approved amendments to Rule 7.5 to replace
subsection (2) of Rule 7.5 and to add Policy 7.5. See Market Integrity Notice 2008-008 – “Provisions
Respecting “Off-Marketplace” Trades” (May 16, 2008).
Effective December 9, 2013, the applicable securities commissions approved amendments to the French
version of UMIR. See IIROC Notice 13-0294 – Notice of Approval and Implementation – “Amendments to
the French version of UMIR” (December 9, 2013).

Guidance:

See Market Integrity Notice 2004-002 – “Net Prices Trades” (January 28, 2004).

Guidance:

See Market Integrity Notice 2005-034 – “Risk-Bid Tenders – Trading a Portfolio of Securities as
Principal” (October 28, 2005).

Repealed Guidance:

See Market Integrity Notice 2006-005 – “Guarantee by a Participant of a Trade Price” (February 10,2006). This Market Integrity Notice was repealed and replaced by IIROC Notice 12-0010 – “Guidance on
the Guarantee by a Participant of a Trade Price for a Client Order” (January 9, 2012).

Guidance:

See IIROC Notice 12-0010 – “Guidance on the Guarantee by a Participant of a Trade Price for a
Client” (January 9, 2012).

Part 7 - Trading in a Marketplace
December 9, 2013

UMIR 7.5-2

Universal Market Integrity Rules

Rules & Policies

7.6

Cancelled Trades
If a trade is cancelled, a subsequent trade on any marketplace which was:(a)executed as a result of the price of the cancelled trade; or(b)permitted only as a result of the price of the cancelled trade,shall stand unless cancelled by the consent of the buyer and the seller or by a Market
Integrity Official who is of the opinion that the cancellation of the subsequent trade isappropriate under the circumstances.
Defined Terms:

UMIR section 1.1 – “Market Integrity Official” and “marketplace”
UMIR section 1.2(2) – “trade”

Related Provision:

UMIR section 7.11

Part 7 - Trading in a Marketplace
April 1, 2005

UMIR 7.6-1

Universal Market Integrity Rules

Rules & Policies

7.7

Trading During Certain Securities Transactions(1)

Prohibitions - Except as permitted, a dealer-restricted person shall not at any time
during the restricted period:
(a)

(b)

bid for or purchase a restricted security for an account:(i)of a dealer-restricted person, or(ii)over which the dealer-restricted person exercises direction or control; orattempt to induce or cause any person to purchase a restricted security.

(2)

Prohibitions on Acting for Issuer-Restricted Persons - Except as permitted, if adealer-restricted person knows or ought reasonably to know that a person is an
issuer-restricted person, the dealer-restricted person shall not at any time during
the restricted period applicable to a particular issuer-restricted person bid for orpurchase a restricted security for the account of that issuer-restricted person or an
account over which that issuer-restricted person exercises direction or control.

(3)

Deemed Recommencement of a Restricted Period - If a Participant appointed to
be an underwriter in a prospectus distribution or a restricted private placement
receives a notice or notices of the exercise of statutory rights of withdrawal or
rights of rescission from purchasers of, in the aggregate, not less than 5% of theoffered securities allotted to or acquired by the Participant in connection with theprospectus distribution or the restricted private placement then a restricted period
shall be deemed to have commenced upon receipt of such notice or notices andshall be deemed to have ended at the time the Participant has distributed its
participation, including the securities that were the subject of the notice or noticesof the exercise of statutory rights of withdrawal or rights of rescission.

(4)

Exemptions - Subsection (1) does not apply to a dealer-restricted person inconnection with:(a) market stabilization or market balancing activities where the bid for orpurchase of a restricted security is for the purpose of maintaining a fair andorderly market in the offered security by reducing the price volatility of or
addressing imbalances in buying and selling interests for the restrictedsecurity provided that the bid or purchase is at a price which does notexceed:(i)in the case of an offered security, the least of:(A)

Part 7 – Trading in a Marketplace
December 9, 2013

the price at which the offered security will be issued in aprospectus distribution or restricted private placement, if thatprice has been determined,

UMIR 7.7-1

(ii)

(B)

the best independent bid price at the commencement of therestricted period if the price at which the offered security will be
issued in a prospectus distribution or restricted private placement
has not been determined or if the offered security will be issued
pursuant to a securities exchange take-over bid, an issuer bid oran amalgamation, arrangement, capital reorganization or similartransaction, and(C)the best independent bid price at the time of the entry on amarketplace of the order to purchase,in the case of a connected security, the lesser of:(A)

the best independent bid price at the commencement of therestricted period, and(B)

the best independent bid price at the time of the entry on amarketplace of the order to purchase,provided that if the restricted security has not previously traded on amarketplace, the price also does not exceed the price of the last trade of the
security executed on a foreign organized regulated market other than a tradethat the dealer-restricted person knows or ought reasonably to know has
been entered by or on behalf of a person that is a dealer-restricted person or
an issuer-restricted person;
(b)

(c)

a restricted security that is:(i)a highly-liquid security,(ii)

a unit of an Exempt Exchange-traded Fund, or(iii)

a connected security of a security referred to in subclause (i) or (ii);a bid or purchase by a dealer-restricted person on behalf of a client, otherthan a client that the dealer-restricted person knows or ought reasonably toknow is an issuer-restricted person provided that:(i)the client order has not been solicited by the dealer-restricted person,
or

(ii)

if the client order was solicited, the solicitation by the dealer-restrictedperson occurred prior to the commencement of the restricted period;(d)the exercise of an option, right, warrant or a similar contractual arrangement
held or entered into by the dealer-restricted person prior to the commencementof the restricted period;(e)a bid for or purchase of a restricted security is made pursuant to a Small
Securityholder Selling and Purchase Arrangement undertaken in accordancewith National Instrument 32-101 or similar rules applicable to any marketplace
on which the bid or purchase is entered or executed;(f)the solicitation of a tender of securities to a securities exchange take-over bid
or issuer bid;(g)a subscription for or purchase of an offered security pursuant to a prospectus
distribution or restricted private placement;

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UMIR 7.7-2

(h)a bid or purchase of a restricted security to cover a short position entered into
prior to the commencement of the restricted period;(i)a bid or purchase of a restricted security is solely for the purpose ofrebalancing a portfolio, the composition of which is based on an index as
designated by the Market Regulator, to reflect an adjustment made in thecomposition of the index;(j)a purchase that is or a bid that on execution would be:

(k)

(5)

(6)

(i)

a basket trade, or(ii)

a Program Trade; ora bid for a purchase of a restricted security for an arbitrage account and thedealer-restricted person knows or has reasonable grounds to believe that abid enabling the dealer-restricted person to cover the purchase is thenavailable and the dealer-restricted person intends to accept such bid
immediately.

Exemptions on Acting for an Issuer-restricted Person - Subsection (2) does
not apply to a dealer-restricted person in connection with:(a)the exercise by an issuer-restricted person of an option, right, warrant, or asimilar contractual arrangement held or entered into by the issuer-restrictedperson prior to the commencement of the restricted period;(b)a bid or purchase by an issuer-restricted person of a restricted security pursuant
to a Small Securityholder Selling and Purchase Arrangement made inaccordance with National Instrument 32-101 or similar rules applicable to any
marketplace on which the bid or purchase is entered or executed;(c)

an issuer bid described in clauses 93(3)(a) through (d) of the Securities Act(Ontario) or similar provisions of applicable securities legislation if the issuer did
not solicit the sale of the securities sold under those provisions;(d)the solicitation of the tender of securities to a securities exchange take-overbid or issuer bid; or(e)a subscription for or purchase of an offered security pursuant to a prospectus
distribution or a restricted private placement.

Compilations and Industry Research - Despite subsection (1), a dealerrestricted person may, if permitted under applicable securities legislation, publish
or disseminate any information, opinion or recommendation relating to the issuer ofa restricted security, if the information, opinion or recommendation is in a
publication that is disseminated with reasonable regularity in the normal course ofbusiness of the dealer-restricted person and:(a)the restricted security is a highly-liquid security; or(b)the publication:(i)

includes similar coverage in the form of information, opinions or
recommendations with respect to a substantial number of issuers in thePart 7 – Trading in a Marketplace
December 9, 2013

UMIR 7.7-3

issuer’s industry or contains a comprehensive list of securities currently
recommended by the dealer-restricted person, and
(ii)

(7)

(8)

(9)

gives no materially greater space or prominence to the information,
opinion or recommendation related to the restricted security or the issuerof the restricted security than that given to other securities or issuers.

Transactions by Person with Marketplace Trading Obligations - Despite
subsection (1), a dealer-restricted person with Marketplace Trading Obligations fora restricted security may, for their trading account in respect of such Marketplace
Trading Obligations:(a)with the prior approval of a Market Integrity Official, enter a bid to move thecalculated opening price of a restricted security to a more reasonable level;(b)purchase a restricted security pursuant to their Marketplace Trading
Obligations; and(c)bid for or purchase a restricted security:(i)that is traded on another marketplace or foreign organized regulated
market for the purpose of matching a higher-priced bid posted on suchmarketplace or foreign organized regulated market,(ii)

that is convertible, exchangeable or exercisable into another listed
security for the purpose of maintaining an appropriate conversion,exchange or exercise ratio, and(iii)

to cover a short position resulting from sales made under theirMarketplace Trading Obligations.

Transactions by the Derivatives Market Maker – Despite subsection (1), a
dealer-restricted person who is a derivatives market maker with responsibility for a
derivative security the underlying interest of which is a restricted security may, fortheir derivatives market making trading account, bid for or purchase a restrictedsecurity if:(a)the restricted security is the underlying security of the option for which theperson is the specialist;(b)

there is not otherwise a suitable derivative hedge available; and(c)such bid or purchase is:(i)for the purpose of hedging a pre-existing options position,(ii)

reasonably contemporaneous with the trade in the option, and(iii)

consistent with normal market-making practice.

Application of Exemptions to a Dealer-Restricted Person and IssuerRestricted Person – Where a dealer-restricted person is also an issuer-restrictedperson the exemptions in subsections (4), (6), (7) and (8) continue to be available
to the dealer-restricted person.

Part 7 – Trading in a Marketplace
December 9, 2013

UMIR 7.7-4

POLICY 7.7 – TRADING DURING CERTAIN SECURITIES TRANSACTIONSPart 1 – Manipulative or Deceptive Activity
Provisions prohibiting manipulative or deceptive activities, including activities that may create
misleading pricing or trading activity that is detrimental to investors and the integrity of themarkets, are contained in Rule 2.2. Rule 7.7 generally prohibits purchases of or bids for
restricted securities in circumstances where there is heightened concern over the possibility ofmanipulation by those with an interest in the outcome of the distribution or transaction. Rule 7.7
also provides certain exemptions to permit purchases and bids in situations where there is no,or a very low possibility of manipulation. However, the Market Regulator is of the view that
notwithstanding that certain trading activities are permitted under Rule 7.7, these activities
continue to be subject to the general provisions relating to manipulative or deceptive activities inRule 2.2 and the provisions on manipulation and fraud found in applicable securities legislationsuch that any activities carried out in accordance with Rule 7.7 must still meet the spirit of thegeneral anti-manipulation provisions.

Part 2 - Market Stabilization and Market Balancing
Rule 7.7(4)(a) provides a dealer-restricted person with an exemption from the prohibitions insubsection (1) for market stabilization and market balancing activities subject to price limitations.
Market stabilization and market balancing activities should be engaged in for the purpose ofmaintaining a fair and orderly market in the offered security by reducing the price volatility of or
addressing imbalances in buying and selling interests for the restricted security.
The Market Regulator considers it to be inappropriate for a dealer to engage in market
stabilization activities in circumstances where dealer knows or should reasonably know that themarket price is not fairly and properly determined by supply and demand. This might exist
where, for example, the dealer is aware that the market price is a result of inappropriate activity
by a market participant or that there is undisclosed material information regarding the issuer.
Market balancing activities should contribute to a fair and orderly market by contributing to pricecontinuity and depth and by minimizing supply-demand disparity. Market balancing does notseek to prevent or unduly retard any price movements, but merely to prevent erratic or
disorderly changes in price.

Part 3 – Short Position Exemption
Rule 7.7(4)(h) provides an exemption from the prohibitions in subsection (1) for a dealerrestricted person in connection with a bid for or purchase to cover a short position provided thatshort position was entered into before the commencement of the restricted period. Shortpositions entered into during the restricted period may be covered by purchases made inreliance upon the market stabilization exemption in Rule 7.7(4)(a), subject to the price limits set
out in that exemption. (See “Part 5 – Trading Pursuant to Marketplace Trading Obligations” fora discussion of the ability of persons with Marketplace Trading Obligations to cover shortpositions arising during the restricted period pursuant to their Marketplace Trading Obligations.)

Part 7 – Trading in a Marketplace
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UMIR 7.7-5

Part 4 – Research
The Market Regulator is of the view that although sections 4.1 and 4.2 of OSC Rule 48-501 do
permit a dealer-restricted person to disseminate research reports, this dissemination continues
to be subject to the usual restrictions that are applicable to a dealer-restricted person inpossession of material information regarding the issuer that has not been generally disclosed.
Rule 7.7(6) provides circumstances where a dealer-restricted person may publish or
disseminate information, an opinion, or a recommendation relating to the issuer of a restrictedsecurity. The Rule requires that the information, opinion or recommendation is contained in a
publication which is disseminated with reasonable regularity in the normal course of business ofthe dealer-restricted person. The Market Regulator considers that it is a question of fact
whether a publication was disseminated “with reasonable regularity” and whether it was in the“normal course of business”. A research publication would not likely be considered to havebeen published with reasonable regularity if it had not been published within the previous twelve
month period or there had been no coverage of the issuer within the previous twelve month
period. The nature and extent of the published information should also be consistent with priorpublications and the dealer should not undertake new initiatives in the context of the distribution.
For example, the inclusion of projections of issuers’ earnings and revenues would likely only bepermitted if they had previously been included on a regular basis. The Market Regulator may
consider the distribution channels for the dissemination of the publication when considering
whether a publication was “in the normal course of business”. The research should be
distributed through the dealer-restricted person’s usual research distribution channels andshould not be targeted or distributed specifically to prospective investors in the distribution aspart of a marketing effort. However, the research may be distributed to a prospective investor ifthat investor was previously on the mailing list for the research publication.
Rule 7.7(6)(b) requires that the information, opinion or recommendation includes similar
coverage in the form of information, opinions or recommendations with respect to a substantial
number of issuers in the issuer’s industry. In this context, reference should be made to therelevant industry when determining what constitutes a “substantial number of issuers”.
Generally, the Market Regulator would consider a minimum of six issuers to be a sufficientnumber. However, where there are less than six issuers in an industry, then all issuers should
be included in the research report, and in any event the number of issuers should not be lessthan three.

Part 5 – Trading Pursuant to Marketplace Trading Obligations
Under Rule 7.7(7)(b), a dealer-restricted person with Marketplace Trading Obligations for a
restricted security may, for their trading account in connection with such Marketplace Trading
Obligations, purchase a restricted security pursuant to their Marketplace Trading Obligations.
Not every purchase of a restricted security by a person with Marketplace Trading Obligations
will be considered to be undertaken pursuant to their Marketplace Trading Obligations. For
example, if a market making system of an Exchange or QTRS permits a market maker tovoluntarily participate in trades that participation may only result in purchases that are:•made at prices which are permitted by Rule 7.7(4)(a); or•

to cover a short position resulting from sales made under their Marketplace Trading
Obligations.

Part 7 – Trading in a Marketplace
December 9, 2013

UMIR 7.7-6

Use of a voluntary participation feature in other circumstances, may result in the market maker
not complying with the prohibitions or restrictions on trading under Rule 7.7.
Defined Terms:

NI 14-101 section 1.1(3) – “issuer bid”, “securities legislation” and “take-over bid”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “arbitrage account”, “basket trade”, “best independent sale price”, “client order”,“connected security”, “dealer-restricted person”, “derivatives market marker”, “Exchange”, “Exempt
Exchange-traded Fund”, ‘foreign organized regulated market”, “hedge”, “highly-liquid security”, “issuerrestricted person”, “listed security”, “Market Integrity Official”, “marketplace”, “Marketplace Trading
Obligations”, “Marketplace Rules”, “Market Regulator”, “Program Trade”, “offered security”, “restrictedperiod”, “restricted private placement”, “restricted security”, “securities exchange take-over bid” and“QTRS”
UMIR section 1.2(2) – “person” and “trade”

Related Provisions:

UMIR section 1.2(6) – Interpretation of “restricted period” and UMIR section 2.2

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved amendments effective
May 9, 2005 to repeal and replace section 7.7 and to add Parts 1, 2, 3, 4 and 5 of Policy 7.7. See
Market Integrity Notice 2005-007 – “Amendments Respecting Trading During Certain Securities
Transactions” (March 4, 2005).
Effective May 16, 2008, the applicable securities commissions approved an amendment to Rule 7.7 toreplace the phrase “an organized regulated market outside of Canada that publicly disseminates detailsof trades executed on that market” with “foreign organized regulated market or other market”. See
Market Integrity Notice 2008-008 – “Provisions Respecting “Off-Marketplace” Trades” (May 16,2008).
Effective January 8, 2010, the applicable securities commissions approved amendments to subsection(4) of section 7.7 to delete the words “the lesser of” in clause (a); amendments to subsection (4) ofsection 7.7 to repeal and replace subclause (a)(i), to add the words “the lesser of” after the word
“security” in subclause (a)(ii), to replace the “last independent sale price” by “best independent saleprice” in paragraphs (A) and (B) of subclause (a)(ii), to replace the words “Exchange-traded Fund” by“Exempt Exchange-traded Fund” in subclause (b)(ii), and to replace the word “market” by “marketplaceor foreign organized regulated market” in clause (c). See IIROC Notice 10-0006 – “Provisions
Respecting Trading During Certain Securities Transactions” (January 8, 2010).
Effective August 26, 2011, the applicable securities regulatory authorities approved amendments tosection 7.7 and Policy 7.7 principally to replace the definition of “Market Maker Obligations” with adefinition of “Marketplace Trading Obligations”. See IIROC Notice 11-0251 – “Provisions Respecting
Market Maker, Odd Lot and Other Marketplace Trading Obligations” (August 26, 2011).
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French version of
UMIR” (December 9, 2013).

Guidance:

See Market Integrity Notice 2005-013 – “Effective Date of Amendments Respecting Trading During
Certain Securities Transactions” (May 2, 2005).

Repealed Guidance:

See Market Integrity Notice 2005-023 – “Securities Trading on Multiple Marketplaces” (July 29,2005) which was repealed and replaced by Market Integrity Notice 2006-017 – “Securities Trading on
Multiple Marketplaces” (September 1, 2006).

Guidance:

See Market Integrity Notice 2006-003 – “Solicitation of Client Orders During a Restricted Period”(January 31, 2006).

Guidance:

See Market Integrity Notice 2006-016 – “Trading During Certain Securities Transactions” (July 10,2006).

Partially Repealed Guidance: See Market Integrity Notice 2006-017 – “Guidance – Securities Trading on Multiple
Marketplaces” (September 1, 2006). Section respecting Rule 5.1 – Best Execution of Client
Orders of MIN 2006-017 was repealed and replaced effective January 2, 2018 by IIROC Notice
17-0138 – “Guidance on Best Execution” (July 6, 2017).
Guidance:

See IIROC Notice 09-0007 – “‘Principal Market’ Determination for 2009” (January 9, 2009).

Guidance:

See IIROC Notice 10-0095 – “‘Principal Market’ Determination for 2010” (April 6, 2010).

General Commentary:

A current list of the securities which have been designated to be excluded from the definition as an“Exempt Exchange-traded Fund” is available on the IIROC website (at www.iiroc.ca).
A list of the securities which on any particular trading day qualify as a “highly-liquid security” is available
on the IIROC website (at www.iiroc.ca).

Part 7 – Trading in a Marketplace
December 9, 2013

UMIR 7.7-7

A current list of the indices which have been designated by IIROC for the purposes of UMIR is available
on the IIROC website (at www.iiroc.ca).
Disciplinary Proceedings: In the Matter of David William Trim (“Trim”) (October 30, 2002) OOS 2002-005
Facts – On January 16, 2001, Trim, a trader employed by BMO Nesbitt Burns Inc. (“BMO”), enteredinto a trade for shares of a company at a price in excess of the maximum permitted stabilization
price during a restricted period which the security was subject to. In a separate transaction, on
September 6, 2001, Trim, entered into a trade to cover an outstanding short position in a security
that, at the time of the trade, was on BMO’s restricted list. Trim was advised by BMO’s Corporate
Compliance Department that he could cover his outstanding short position so long as the bid orpurchase price was not higher than the maximum permitted stabilization price, in this case $4.50.
Trim subsequently entered into a trade for the shares at $4.54.
Disposition – Trim executed prohibited trades in two securities at a time when BMO was involved ina distribution of these securities and had restricted trading of the securities.
Requirements Considered – TSX Rules 7-106(b) and 4-303. Comparable UMIR Provision - Rule
7.7
Sanction - $10,000 fine and costs of $3,500
Disciplinary Proceedings:

Rule 7.7(5) (pre-May 2005 version) was considered In the Matter of Scotia Capital Inc. (“Scotia”)(February 26, 2007) DN 2007-001. See Disciplinary Proceedings under Rule 6.4.

Disciplinary Proceedings:

In the Matter of Global Securities Corporation (“Global”) (December 3, 2007) DN 2007-005
Facts – Between October 6, 2005, and November 16, 2005, Global, while acting as an underwriter
for a private placement of securities for Jasper Mining Corporation (“Jasper”), entered twenty-fiveorders to buy shares of Jasper (resulting in forty-three trades) for non-client, inventory and client
accounts (on a solicited or discretionary basis).
Disposition – Subject to certain exemptions, UMIR imposes trading restrictions on a dealer with aninterest in the outcome of the distribution of securities or other transactions (“Dealer-Restricted
Person”). During the relevant period, Global was a Dealer-Restricted Person, and as such, wasprohibited from bidding for or purchasing shares of Jasper for its own account, for an account overwhich Global exercised direction or control or soliciting the purchase of shares of Jasper. By
purchasing shares of Jasper for non-client, inventory and client accounts over which Global had
discretion or solicited such purchase, Global did harm to the reputation of the marketplace and the
public’s perception of the capital markets.
Requirements Considered – Rule 7.7
Sanction – $65,000 fine and costs of $25,000

Disciplinary Proceedings: Rule 7.7(5) [as it existed prior to May, 2005] was considered In the Matter of David Berry (“Berry”)(January 17, 2013) DN 13-0018. See Disciplinary Proceeding under Rule 6.4.

Part 7 – Trading in a Marketplace
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UMIR 7.7-8

Universal Market Integrity Rules

Rules & Policies

7.8

Restrictions on Trading During a Securities Exchange Take-over Bid- repealed

Regulatory History:

Effective February 25, 2005, the applicable securities commissions approved an amendment to repeal
section 7.8 effective May 9, 2005. See Market Integrity Notice 2005-007 – “Amendments Respecting
Trading During Certain Securities Transactions” (March 4, 2005).

Part 7 – Trading in a Marketplace
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UMIR 7.8-1

Universal Market Integrity Rules

Rules & Policies

7.9
Trading in Listed or Quoted Securities or Derivatives by a Derivatives
Market Maker
A Participant who is a derivatives market maker shall comply when trading on any
marketplace with such additional requirements as may be required by:(a)an Exchange when trading on that Exchange in listed securities or derivatives; and(b)a QTRS when trading on that QTRS in quoted securities.

Defined Terms:
Regulatory History:

UMIR section 1.1 – “derivative”, “derivatives market maker”, “Exchange”, “listed security”,“marketplace”, “Participant”, “quoted security” and “QTRS”
Effective December 14, 2022, the applicable securities commissions approved amendments to extend therequirements under UMIR 7.9 to the trading of derivatives on an Exchange. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September 15, 2022).

Part 7 - Trading in a Marketplace
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UMIR 7.9-1

Universal Market Integrity Rules

Rules & Policies

7.10

Extended Failed Trades(1)

If within ten trading days following the date for settlement contemplated on theexecution of a failed trade, the account:(a)in the case of a sale, other than a short sale, that failed to make available
securities in such number and form;(b)in the case of a short sale, that failed to make:(i)available securities in such number and form, or(ii) arrangements with the Participant or Access Person to borrow securities
in such number and form; and(c)in the case of a purchase, that failed to make available monies in suchamount,as to permit the settlement of the trade at the time on the date contemplated on
the execution of the trade has not made available such securities or monies or has
not made arrangements for the borrowing of the securities, as the case may be,
the Participant or Access Person that entered the order on a marketplace shallgive notice to the Market Regulator at such time and in such form and manner andcontaining such information as may be required by the Market Regulator.
(2)

If a Participant or Access Person is required to provide notice of a failed trade to
the Market Regulator in accordance with subsection (1), the Participant or Access
Person shall, upon the account making available the applicable securities ormonies or making arrangement for the borrowing of the applicable securities, givenotice to the Market Regulator at such time and in such form and manner andcontaining such information as may be required by the Market Regulator.

Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “failed trade”, “Market Regulator”, “marketplace”, “Participant”,“short sale” and “trading day”
UMIR section 1.2(2) – “trade”

Regulatory History:

On October 14, 2008, the applicable securities commissions approved amendments to UMIR related toshort sales and failed trades. See IIROC Notice 08-0143 – “Provisions Respecting Short Sales andFailed Trades” (October 15, 2008). The initial implementation date of March 1, 2009, was deferredindefinitely by IIROC. See IIROC Notice 09-0062 – “Deferral of Implementation Date of theReporting of Extended Failed Trades and Trade Variations and Cancellations” (February 26,2009). The reporting requirement for certain Extended Failed Trades became effective on June 1, 2011by IIROC Notice 11-0080 – “Implementation Date for the Reporting of Extended Failed Trades”(February 25, 2011). The reporting requirement was expanded to include “trade-for-trade” failed trades
and became effective April 15, 2013 by IIROC Notice 13-0014 – “Implementation Date for Reporting“Trade-for-Trade” Extended Failed Trades” (January 14, 2013).

Guidance:

See IIROC Notice 11-0161 – “Reminder Regarding the Reporting of Extended Failed Trades” (May19, 2011).

Guidance:

See IIROC Notice 13-0100 – “Update Respecting the Implementation of the “Trade-for-Trade"
Extended Failed Trades Reporting” (April 9, 2013).

Guidance:

See IIROC Notice 13-0014 – “Implementation Date for Reporting “Trade-for-Trade” Extended
Failed Trades” (April 9, 2013).

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UMIR 7.10-1

Guidance:

See IIROC Notice 22-0130 – “Guidance on Participant Obligations to have Reasonable
Expectation to Settle any Trade Resulting from the Entry of a Short Sale Order” (August 17, 2022)

Part 7 - Trading in a Marketplace
August 17, 2022

UMIR 7.10-2

Universal Market Integrity Rules

Rules & Policies

7.11

Variation and Cancellation and Correction of Trades
No trade executed on a marketplace shall, subsequent to the execution of the trade, be:(a)cancelled; or(b)varied or corrected with respect to:(i)the price of the trade,(ii)

the volume of the trade, or(iii)

the date for settlement of the trade,

except:(c)by the Market Regulator in accordance with UMIR; or(d)with the prior consent of the Market Regulator, if the variation, cancellation or
correction would be necessary to correct an error caused by a system or
technological malfunction of the marketplace’s systems or equipment or causedby an individual acting on behalf of the marketplace; or(e)with notice to the Market Regulator immediately following the variation,
cancellation or correction of the trade in such form and manner as may be requiredby the Market Regulator and such notice shall be given, if the variation,
cancellation or correction is made:
(i)

(ii)
Defined Terms:

prior to the settlement of the trade, by:(A)

the marketplace on which the trade was executed at the request ofa party to the trade and with the consent of each Participant andAccess Person that is a party to the trade, or(B)the clearing agency through which the trade is or was to be cleared
and settled, andafter the settlement of the trade, by each Participant and Access Personthat is a party to the trade.
UMIR section 1.1 – “Access Person”, “Market Regulator”, “marketplace”, “Participant” and “UMIR”
UMIR section 1.2(2) – “trade”

Regulatory History:

On October 15, 2008, the applicable securities commissions approved amendments to UMIR to add
section 7.11 that came into force on October 14, 2008. See IIROC Notice 08-0143 – “Provisions
Respecting Short Sales and Failed Trades” (October 15, 2008). The implementation date for theseamendments, initially set for March 1, 2009, was deferred until a future date to be determined by
IIROC. See IIROC Notice 09-0062 – “Deferral of Implementation Date of the Reporting ofExtended Failed Trades and Trade Variations and Cancellations” (February 26, 2009).
Effective March 1, 2013, the applicable securities commissions approved amendments to Rule 7.11.
See IIROC Notice 12-0363 – “Provisions Respecting Electronic Trading” (December 7, 2012).

Guidance:

See IIROC Notice 11-0079 – “Implementation Date for the Reporting of Trade Variations andCancellations” (February 25, 2011).
See IIROC Notice 11-0160 – “Reminder Regarding the Reporting of Trade Variations andCancellations” (May 19, 2011).

Part 7 - Trading in a Marketplace
March 1, 2013

UMIR 7.11-1

Universal Market Integrity Rules

Rules & Policies

7.12

Inability to Rely on Marketplace Functionality
A Participant or Access Person shall not enter an order on a particular marketplace if theParticipant or Access Person knows or ought reasonably to know that the handling of theorder by the marketplace and the trading systems of the marketplace may result in thedisplay of the order or the execution of the order not being in compliance with any of theapplicable requirements of UMIR.

Defined Terms:

NI 21-101 section 1.1 – “order”

Regulatory History:

On April 13, 2012, the applicable securities commissions approved an amendment to Part 7, effective
October 15, 2012, to add section 7.12.

UMIR section 1.1 – “Access Person”, “marketplace”, “Participant, and “UMIR”

Part 7 - Trading in a Marketplace
October 15, 2012

UMIR 7.12-1

Universal Market Integrity Rules

Rules & Policies

7.13

Direct Electronic Access and Routing Arrangements(1)

A Participant that is a member, user or subscriber may:
(a)

(b)

(2)

(3)

grant direct electronic access or enter into a routing arrangement provided
that the Participant has:(i)established standards that are reasonably designed to manage, in
accordance with prudent business practices, the Participant’s risks
associated with providing direct electronic access to a client or
implementing a routing arrangement with an investment dealer or
foreign dealer equivalent,(ii)

assessed and documented that the client, investment dealer or foreigndealer equivalent meets the standards established by the Participant,
and

(iii)

executed a written agreement with the client, investment dealer or
foreign dealer equivalent; andnot grant direct electronic access if the client is acting and registered as a
dealer in accordance with applicable securities legislation.

The standards established by the Participant under subsection (1) must include arequirement that the client, investment dealer or foreign dealer equivalent:(a)has sufficient resources to meet any financial obligations that may result fromuse of direct electronic access or the routing arrangement;(b)

has reasonable arrangements in place to ensure that all personnel
transmitting orders using direct electronic access or the routing arrangement
have reasonable knowledge of and proficiency in the use of the order entry
system;(c)has reasonable knowledge of and the ability to comply with all applicable
Requirements, including the marking of each order with the designations andidentifiers required by Rule 6.2;

(d)has reasonable arrangements in place to monitor the entry of orderstransmitted using direct electronic access or the routing arrangement;(e)takes all reasonable steps to ensure that the use of automated ordersystems, by itself or any client, does not interfere with fair and orderly
markets; and(f)ensures that each automated order system, used by itself or any client, istested in accordance with prudent business practices, including initially before
use or introduction of a significant modification and at least annually
thereafter.

The written agreement entered into by a Participant under subsection (1) with theclient, investment dealer or foreign dealer equivalent must provide that:

Part 7 - Trading in a Marketplace
March 30, 2022

UMIR 7.13-1

(a)in the case of an agreement for direct electronic access or a routing
arrangement:(i)the trading activity of the client, investment dealer or foreign dealer
equivalent will comply with:(A)

all Requirements, and(B)

the product limits or credit or other financial limits specified by theParticipant;(ii)

the client, investment dealer or foreign dealer equivalent will maintain alltechnology facilitating direct electronic access or a routing arrangement
in a secure manner and will not permit any person to transmit an orderusing the direct electronic access or the routing arrangement other thanthe personnel authorized by the client and named under the provision of
the agreement referred to in sub-clause (b)(i), or personnel authorized
by the investment dealer or foreign dealer equivalent;(iii)

the client, investment dealer or foreign dealer equivalent will fully cooperate with the Participant in connection with any investigation orproceeding by any marketplace or the Market Regulator with respect totrading conducted pursuant to direct electronic access or a routing
arrangement, including upon request by the Participant, providing
access to information to the marketplace or Market Regulator that isnecessary for the purposes of the investigation or proceeding;(iv)

the Participant is authorized, without prior notice, to:(A)reject any order,(B)vary or correct any order entered on a marketplace to comply
with Requirements,(C)cancel any order entered on a marketplace, or(D)discontinue accepting orders,from the client, investment dealer or foreign dealer equivalent;
(v)

(b)

the client, investment dealer or foreign dealer equivalent will
immediately inform the Participant if the client, investment dealer or
foreign dealer equivalent fails or expects not to meet the standards set
by the Participant; andin the case of an agreement for direct electronic access:
(i)

(ii)

the client will immediately notify the Participant in writing of:(A)

the names of the personnel of the client authorized by the client toenter an order using direct electronic access, and(B)

details of any change to the information in sub-clause (A);the client may not trade for the account of any other person unless theclient is:(A)

Part 7 - Trading in a Marketplace
March 30, 2022

registered or exempted from registration as an adviser under
securities legislation, or

UMIR 7.13-2

(B)a person conducting business in a foreign jurisdiction in a manner
analogous to an adviser and that is subject to the regulatory
jurisdiction of a signatory to the International Organization of
Securities
Commissions’Multilateral
Memorandumof
Understanding in that foreign jurisdiction

and the order is for or on behalf of a person who is itself a client of theclient acting in the capacity of adviser for that person;
(iii)

(iv)

(c)

(4)

if the client trades for the account of any other person in accordancewith sub-clause (ii), the client must:(A)

ensure that the orders for the other person are transmitted
through the systems of the client before being entered on amarketplace, and(B)

ensure that the orders for the other person are subject toreasonable risk management and supervisory controls, policies
and procedures established and maintained by the client;

the Participant shall provide to the client, in a timely manner, any
relevant amendments or changes to:(A)applicable Requirements, and(B)

the standards established by the Participant under subsection(1); andin the case of a routing arrangement agreement, the investment dealer or
foreign dealer equivalent will not allow any order entered electronically by aclient of the investment dealer or foreign dealer equivalent to be entereddirectly to a marketplace unless:(i)the client’s order is transmitted through the systems of the investment
dealer or foreign dealer equivalent, prior to being transmitted throughthe systems of the Participant for automatic onward transmission to amarketplace or transmitted directly to a marketplace without being
electronically transmitted through the system of the Participant, and(ii)

the client’s order is subject to reasonable risk management andsupervisory controls, policies and procedures established andmaintained by the investment dealer or foreign dealer equivalent.

A Participant must not allow any order to be transmitted using direct electronic
access or through a routing arrangement unless:(a)the Participant is:(i)maintaining and applying the standards established by the Participant
under subsection (1),(ii)

satisfied the client, investment dealer or foreign dealer equivalent meetsthe standards established by the Participant under subsection (1), and(iii)

satisfied the client, investment dealer or foreign dealer equivalent is incompliance with the written agreement entered into with the Participant;andPart 7 - Trading in a Marketplace
March 30, 2022

UMIR 7.13-3

(b)

(5)

The Participant shall:
(a)

(b)

(6)

the order is subject to the risk management and supervisory controls, policies
and procedures established by the Participant including the automatedcontrols to examine each order before entry on a marketplace.

at least annually review and confirm that:(i)the standards established by the Participant under subsection (1) are
adequate, and(ii)

the Participant has maintained and consistently applied the standards
in the period since the establishment of the standards or the date of thelast annual review; andat least annually by the anniversary date of the written agreement assess,confirm and document that the client, investment dealer or foreign dealer
equivalent:(i)

is in compliance with the written agreement with the Participant, and(ii)

has met the standards established by the Participant under subsection(1) since the date of the written agreement or the date of the last annual
review.

A Participant shall forthwith notify the Market Regulator:(a)upon entering into a written agreement respecting direct electronic access, ofthe name of the client that is not eligible to obtain a Legal Entity Identifier
under the standards set by the Global Legal Entity Identifier System; and(b)of any change in the information described in clause (a).

Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
NI 21-101 section 1.1 – “member”, “order”, “subscriber” and “user”
NI 23-103 section 1 – “automated order system”
NI 31-103 section 1.1 – “investment dealer”
UMIR section 1.1 – “direct electronic access”, “foreign dealer equivalent”, “Global Legal Entity Identifier
System”, “Legal Entity Identifier”, “Market Regulator”, “marketplace”, “Participant”, “Requirements” and“routing arrangement”

Related Provisions:

UMIR sections 6.2 and 10.18 and Policy 7.1, Parts 7 and 8

Regulatory History:

On July 4, 2013 the applicable securities commissions approved an amendment, effective March 1, 2014,
to add Rule 7.13. See IIROC Notice 13-0184 – “Provisions Respecting Third-Party Electronic Accessto Marketplaces” (July 4, 2013).
Effective March 27, 2018 the applicable securities commissions approved amendments to UMIR 7.13.
See IIROC Notice 17-0189 - “Amendments Respecting Trading Supervision Obligations”(September 28, 2017).
Effective July 26, 2021, the applicable securities commissions approved amendments to sections 1.1,
6.2, 7.13 and 10.15 to add identifier and/or designation requirements for clients on orders sent to amarketplace. See IIROC Notice 19-0071 – “Amendments Respecting Client Identifiers” (April 18,2019).

Guidance:

See IIROC Notice 13-0185 – “Guidance Respecting Third-Party Electronic Access to Marketplaces”(July 4, 2013).

Partially Repealed Technical Notice: See IIROC Notice 13-0290 – “Gatekeeper and Notice Requirements For Direct
Electronic Access and Routing Arrangements” (December 3, 2013). Part A of thisNotice in reference to Rule 7.13(6): Notification of DEA or Routing Arrangement was
repealed and replaced effective July 26, 2021 by IIROC Notice 21-0099 – “Use ofPart 7 - Trading in a Marketplace
March 30, 2022

UMIR 7.13-4

Identifiers and Notification Requirements Respecting Certain Order Execution Onlyand Direct Electronic Access Clients and Advisers” (May 25, 2021).
Technical:

See IIROC Notice 14-0198 – “Extension Requests for the Updating of Client Agreements for ThirdParty Electronic Access to Marketplaces” (August 13, 2014).

Guidance:

See IIROC Notice 21-0099 – “Use of Identifiers and Notification Requirements Respecting Certain
Order Execution Only and Direct Electronic Access Clients and Advisers” (May 25, 2021).

Disciplinary Proceedings:

In the Matter of CIBC World Markets. (“CIBC”) (March 30, 2022), 2022 IIROC 05
Facts – Between September 2019 and July 2020, the Respondent failed to comply with its trading
supervision obligations to maintain a system of risk management and supervisory controls, policies
and procedures reasonably designed, in accordance with prudent business practices, to ensure themanagement of financial, regulatory and other risks associated with the use by its DEA [“directelectronic access”] client of an automated order system contrary to UMIR 7.1, UMIR Policy 7.1 and
UMIR 7.13.
Disposition and Sanction – Pursuant to a Settlement Agreement, CIBC admitted that it contravened
UMIR 7.1, UMIR Policy 7.1 and UMIR 7.13. CIBC agreed to pay a fine of $150,000 and costs of$15,000.
Requirements Considered – Rule 7.1, Policy 7.1, Rule 7.13.

Part 7 - Trading in a Marketplace
March 30, 2022

UMIR 7.13-5

Universal Market Integrity Rules

Rules & Policies

7.14

Position limits for listed derivatives(1) No Participant, acting as principal or agent, shall enter an order to transact in a listed
derivative if the Participant has reason to believe that as a result of the transaction
the Participant or its client would, acting alone or in concert with others, directly or
indirectly, hold or control a position in excess of the position limits established by an
Exchange.
(2) Notwithstanding subsection (1), the Market Regulator may modify the position limits
established by an Exchange if it believes that it is necessary to maintain a fair andorderly market.

Defined Terms:

NI 21-101 section 1.1 – “order”
UMIR section 1.1 – “derivative”, “Exchange”, “listed derivative”, ”Market Regulator”, “Participant”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved amendments to add
requirements for position limits for listed derivatives under UMIR 7.14. See IIROC Notice 22-0140–“Amendments Respecting the Trading of Derivatives on a Marketplace” (September 15, 2022).

Part 7 - Trading in a Marketplace
December 14, 2022

UMIR 7.14-1

PART 8 – PRINCIPAL TRADING
8.1

Client-Principal Trading(1)

A Participant that receives a client order for 50 standard trading units or less of asecurity with a value of $100,000 or less may execute the client order against a
principal order or non-client order at a better price provided the Participant has
taken reasonable steps to ensure that the price is the best available price for theclient under prevailing market conditions.

(2)

Subsection (1) does not apply if the client has directed or consented that the client
order be:

(3)

(a)

a Call Market Order;(b)

an Opening Order;(c)a Market-on-Close Order;(d)a Volume-Weighted Average Price Order;(e)a Basis Order; or(f)a Closing Price Order.

Subsection (1) does not apply if the client order has been entered directly by theclient of the Participant on a marketplace that does not require the disclosure of theidentifier of the Participant in a consolidated market display and the director,
officer, partner, employee or agent of the Participant who enters a principal order
or a non-client order does not have knowledge that the client order is from a clientof the Participant until the execution of the client order.

POLICY 8.1 – CLIENT PRINCIPAL TRADING
Part 1 - General Requirements
Rule 8.1 governs client-principal trades. It provides that, for trades of 50 standard trading units
or less, a Participant trading with one of its clients as principal must give the client a better pricethan the client could obtain on a marketplace. A Participant must take reasonable steps toensure that the price is the best available price for the client taking into account the condition of
the market. If the security is traded on more than one marketplace, the client must receive,
when the Participant is buying, a higher price than the best bid price, and, if the Participant isselling, the client must pay a lower price than the best ask price.
For client-principal trades greater than 50 standard trading units, the Participant may do thetrade provided the client could not obtain a better price on a marketplace in accordance with its
best execution obligation under Part C of Corporation Rule 3100 – Best Execution of Client
Orders. The Participant must take reasonable steps to ensure that the best price is obtained
and the price to the client is justified by the condition of the market.

Part 8 – Principal Trading
July 27, 2023

UMIR 8.1-1

Part 2 – Legal Aspects of the Client-Principal Relationship
A Participant owes a fiduciary duty to its clients. This duty and investors’ trust in our
Participants are fundamental to investor confidence in the integrity of the market. In the Market
Regulator’s view, this relationship of trust arises where there is reliance by the client on theParticipant’s expertise in securities matters. From the point of view of both the client and theParticipant, the fiduciary responsibility exists regardless of the legal form of the transaction. In
other words, an investor who relies on the expertise of a Participant expects the Participant to
act in the investor's best interests regardless of whether the Participant is acting as agent or as
principal. The legal framework underpinning client-principal trades was stated in the 1965
report of the Royal Commission on the Windfall Co. scandal:
An agent must conduct himself so that the interest of the person in whose behalf he isacting is not brought into conflict with his personal interest. An agent may not make forhimself any deal which could have been made for his client within the scope of theclient’s instructions; if he does, he is assumed to have been acting on his client’s behalf
and the client is entitled to the benefit of the transaction. An agent must disclose to theclient any fact known to the agent which would be likely to operate on the client’s
judgment. An agent may not, in connection with his client’s business, make a secretprofit for himself.
These restrictions flow from the recognition of the serious conflicts inseparable from the agency
relationship, and from a corresponding recognition that every such conflict must be resolved infavour of the client. A principal trade may be subject to attack if it appears that the Participant
did not act to the best advantage of its client even if the Participant complies with the technicalrequirements of the Rule. For example, if the principal account profited from the trade byunwinding the position again soon after the principal trade was made, or if the Registered
Representative receives a higher commission than for agency transactions of a similar size
involving similar securities, the Participant will find it more difficult to justify its actions.
Participants should obtain their own legal advice as to the propriety of their client-principal
trading practices. The following are considerations in any client-principal trade:
Consent — At common law, the prior informed consent of the client must be obtained before
the agent may act as principal. This is impractical in the context of trading securities on amarketplace, where at the time of receipt of the client's order the Participant will likely not know
who will be on the other side. If the Participant, through the Registered Representative or other
employee knows that the firm or a non-client of the firm will or probably will take the other side,
the client's consent should be obtained. In particular, if the Registered Representative wishes
to take the other side of the trade with their client, the client must be informed and consent to
the trade in advance. Such consent must be specific to that trade and cannot be in a generalconsent to any future trades with the Registered Representative. As promptly as possible
following the execution of a principal trade, the client should be advised that all or part of the
securities taken or supplied were from an account in which the Participant or a non-client of theParticipant has an interest. This advice would form part of the usual discussion that occurs
when a Registered Representative confirms to the client that the client’s order has been filled. In
addition, the written confirmation must disclose that the order has been filled in a principaltransaction.
Nature of the Client — Some clients are in greater need of protection from the potential conflictof interest in client-principal trades. The onus on the Participant usually will be reduced if theclient is a fully informed institutional client with regard to the state of the market. SophisticatedPart 8 – Principal Trading
July 27, 2023

UMIR 8.1-2

institutional clients are able to judge whether a specific net price is appropriate in the context ofthe market. If there was no prior discussion with the client concerning executing the client's
order in a client-principal trade, or if there are no standing instructions on handling of orders, theParticipant must judge whether any steps need be taken, taking into account the size of theorder and other circumstances, to ensure that a better price is not available. To a large degree
this will depend on the depth of the market and normal liquidity of the security.
Suitability — Compliance with the client-principal trading rules does not relieve a Participant of
its suitability and "know your client" obligations. As with any other trade, Participants mustensure that the trade is suitable for the client, even if the best possible price has been obtained.
Facilitation Accounts — The rules do not apply to a client-principal trade where the inventory
account was used solely to facilitate the execution or confirmation of a client order (for example,
an inventory accumulation account used to give an institutional client a single average-priceconfirmation). In these cases, the client is the beneficial owner of the position in the inventory
account at all times.
Refusal by Client — Participants should ensure that procedures are in place to identify ordersthat should not be effected on a principal basis. This is necessary to deal with situations whereclients notify a Participant that they do not consent to principal trading generally or to particularprincipal trades.

Part 3 - Factors in Determining “Best Available Price”
The price of the principal transaction must also be justified by prevailing market conditions.
Participants should consider such factors as:•

prices and volumes of the last sale and previous trades;•

direction of the market for the security;•

posted size on the bid and offer;•

the size of the spread; and•liquidity of the security.

For example, if the market is $10 bid and $10.50 asked and a client wants to sell 1,000 shares,
it would be inappropriate for a Participant to do a principal trade at $10.05 if the security has
been trading heavily at $10.50 and there is strong bidding for the security at $10 compared to
the number of securities being offered at $10.50. The condition of the market suggests that theclient should be able to sell at a better price than $10.05. Accordingly, the Participant as agent
for the client should post an offer at $10.45 or even $10.50, depending on the circumstances.
The desire of the client to obtain a fill quickly is always a consideration.
Of course, if a client expressly consents to a principal trade on a fully-informed basis, following
the client’s instructions will be reasonable.
In determining the “best available price”, Participants should consider the price and size oforders displayed on marketplaces other than protected marketplaces if such information isavailable or known to the Participant. Specifically, we expect an employee of a Participant touse all order price information that is available or known to that employee when determining the“best available price”. For example, an employee that has access to price information from bothprotected and unprotected marketplaces would be in compliance with the requirement todetermine the “best available price” only if all price information from both protected andunprotected marketplaces was considered when executing a principal order or non-client orderwith a client order. However, a Participant will be considered not to have complied with Rule 8.1
Part 8 – Principal Trading
July 27, 2023

UMIR 8.1-3

if an employee executes a principal order or non-client order with a client order at a better pricewhich is inferior to the price that would have been available to the client on a displayed
marketplace that is not a protected marketplace and the employee executes, in whole or in part,with the order displayed on the marketplace that is not a protected marketplace.
Defined Terms:

NI 21-101 section 1.1 - “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Basis Order”, “best ask price”, “best bid price”, “better price”, “Call Market Order”,“client order”, “Closing Price Order”, “consolidated market display”, “employee”, “Market-on-Close
Order”, “marketplace”, “Market Regulator”, “non-client order”, “Opening Order”, “Participant”, “principal
account”, “principal order”, “standard trading unit” and “Volume-Weighted Average Price Order”
UMIR section 1.2(2) – “trade”

Related Provision:

UMIR section 1.2(3) - Interpretation

Regulatory History:

Effective October 31, 2003, the applicable securities commissions approved an amendment to add
subsection (3) of Rule 8.1 that provides an exemption from the requirement in subsection 8.1(1) undercertain circumstances. See Market Integrity Notice 2003-024 – “Accommodation of Anonymous
Orders” (October 31, 2003).
Effective April 8, 2005, the applicable securities commissions approved an amendment to subsection(2) of Rule 8.1 to add clause (e) that exempts basis orders from the requirement in subsection 8.1(1).
See Market Integrity Notice 2005-010 – “Provisions Respecting a Basis Order” (April 8, 2005).
Effective March 9, 2007, the applicable securities commissions approved an amendment to subsection(2) of Rule 8.1 to add clause (f ) that exempts closing price orders from the requirement in subsection
8.1(1). See Market Integrity Notice 2007-002 – “Provisions Respecting Competitive Marketplaces”(February 26, 2007).
Effective May 16, 2008, the applicable securities commissions approved an amendment to Part 1 of
Policy 8.1 to add the last sentence of the first paragraph that explains if a security is traded on morethan one marketplace, the client must receive a higher price than the bid price when the Participant isbuying and the client must pay a lower price than the best ask price when the Participant is selling. See
Market Integrity Notice 2008-008 – “Provisions Respecting ‘Off-Marketplace’ Trades” (May 16,2008).
In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to Part 1 of Policy 8.1 that came into force on June 1, 2008 to
replace the phrase “of less” with “or less”. See Footnote 1 in Status of Amendments.
Effective September 12, 2008, the applicable securities commissions approved an amendment to Rule
8.1 to delete the phrase “taking into account the condition of the market at that time” and substitute thephrase “under prevailing market conditions”. See IIROC Notice 08-0039 – “Provisions Respecting
Best Execution” (July 18, 2008).
Effective September 12, 2008, the applicable securities commissions approved an amendment to add
Part 3 to Policy 8.1 that outlines factors to be considered in determining “best available price”. See
IIROC Notice 08-0039 – “Provisions Respecting Best Execution” (July 18, 2008).
Effective December 9, 2013, the applicable securities commissions approved housekeeping
amendments to the French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the
French version of UMIR” (December 9, 2013).
Effective September 18, 2015, the applicable securities commissions approved amendments to Part 3of Policy 8.1. See IIROC Notice 15-0211 - Notice of Approval – “Provisions Respecting UnprotectedTransparent Marketplaces and the Order Protection Rule” (September 18, 2015).
Effective January 2, 2018, the applicable securities commissions approved amendments to Part 1 of
Policy 8.1. See IIROC Notice 17-0137 – “Amendments Respecting Best Execution” (July 6, 2017).
Effective December 31, 2021, the applicable securities commissions approved housekeeping
amendments to replace rule references to the Dealer Member Rules with provisions of the IIROC
Rules. See IIROC Notice 20-0042 - Rules Notice – Notice of Approval – UMIR - Housekeeping
amendments to UMIR Following Implementation of IIROC Rules (March 5, 2020).
Effective July 27, 2023, the applicable securities commissions approved housekeeping amendments to
UMIR to correct inaccurate referencing and typographical mistakes and to ensure consistency between
the English and French versions of UMIR. See CIRO Bulletin 23-0107 - "Housekeeping Amendments
to UMIR" (July 27, 2023).

Repealed Guidance:
Part 8 – Principal Trading
July 27, 2023

See Market Integrity Notice 2005-023 – “Securities Trading on Multiple Marketplaces” (July 29,
UMIR 8.1-4

2005). This Notice was repealed and replaced by Market Integrity Notice 2006-017 – “Securities
Trading on Multiple Marketplaces” (September 1, 2006).
Partially Repealed Guidance: See Market Integrity Notice 2006-017 – “Securities Trading on Multiple Marketplaces”(September 1, 2006). Section respecting Rule 5.1 – Best Execution of Client Orders of MIN
2006-017 was repealed and replaced effective January 2, 2018 by IIROC Notice 17-0138 –“Guidance on Best Execution” (July 6, 2017).
Guidance:

See IIROC Notice 17-1038 – “Guidance on Best Execution” (July 6, 2017).

Disciplinary Proceedings:

In the Matter of Robert Bastianon (“Bastianon”) (October 30, 2002) OOS 2002-004
Facts – On February 19, 2002, Bastianon, a trader, executed an order to sell shares of a listed
security from his firm’s inventory account in a cross trade with a client. The trade was entered atprice of $28.00 at a time when the quotation for the listed security was $27.80 bid and $28.00 ask.
Disposition – Bastianon was required to provide the client with price improvement over the ask priceto ensure that the client received a price that was better than the quoted market. Bastianon failed toprovide the requisite price improvement to the client.
Requirements Considered – TSX Rule 4-502(2). Comparable UMIR Provision – Rule 8.1
Sanction - $10,000 fine and costs of $2,500

Disciplinary Proceedings:

In the Matter of Russell Marceniuk (“Marceniuk”) (December 12, 2002) OOS 2002-008
Facts – On May 7, 2001, Marceniuk, a liability trader and registered representative, executed anorder to sell shares of a company from his liability account (principal account) in a cross with aclient. The trade was entered at $68.68, at a time when the quotation for the stock was $68.50 bid
and $68.68 ask.
Disposition – When a trader engages in a customer-principal trade, the trader is required to ensurethat the client receives a price that is better than the quoted market. Marceniuk was required toprovide the client with price improvement over the ask price.
Requirements Considered – TSX Rule 4-502. Comparable UMIR Provision – Rule 8.1
Sanction - $10,000 fine and costs of $1,500

Disciplinary Proceedings:

Rule 8.1 was considered In the Matter of Golden Capital Securities Ltd. (“Golden”), Jack
Finkelstein (“Finkelstein”) and Jeff Rutledge (“Rutledge”) (November 23, 2007) DN 2007-004.
See Disciplinary Proceeding under Rule 6.2.

Disciplinary Proceedings:

In the Matter of Steve Horrocks (“Horrocks”) (August 5, 2009) DN 09-0229
Facts – On each of July 12, September 5, and November 12, 2006, Horrocks, an institutional traderat Canaccord Capital Corporation (“Canaccord”), executed intentional cross trades between a
Canaccord proprietary account and a client account for 50 standard trading units or less (with avalue of less than $100,000) in listed securities without providing price improvement to the client
order. In all cases the client order traded with orders for Canaccord’s proprietary account at either
the “ask” price in the case of a buy, or the “bid” price in the case of a sale.
Disposition – When a trader engages in a client-principal trade for 50 standard trading units or less,the trader is required to ensure that the client receives a price that is better than the quoted market.
By failing to provide price improvement to the client orders, Horrocks violated Rule 8.1.
Requirements Considered – Rules 8.1 and 10.3(4)Sanctions - $10,000 fine and costs of $2,000.

Disciplinary Proceedings:

In the Matter of Melaney Phillips (“Phillips”) (November 30, 2011) DN 11-0343
Facts – On or about July 13, 2007, Phillips recommended and purchased shares in the account ofher client which were acquired directly from part of her own personal sell order without advising theclient of her interest in the transaction or taking reasonable steps to ensure the client obtained theshares for the best available price. The client received a worse price than that which was in themarket in that there was no activity in the market for the security at any price. The remainder ofPhillips’ sell order was filled in subsequent days at lower prices.
Disposition – Phillips sold shares from her own account to a client without ensuring the client
obtained the best available price, contrary to UMIR 8.1 which provides that a representative may
only sell to a client for the representative’s own account if they sell to a client at a better price thanthat which is in the market.
Requirements Considered – Rule 8.1.
Sanction – The Hearing Panel imposed penalties on Phillips related to the breach of UMIR 8.1 andother breaches of the Dealer Member Rules with a fine of $290,000; disgorgement of profits of$10,350; a 3 year suspension from registration; payment of fine, disgorgement and costs prior to reregistration; successful completion of appropriate courses prior to re-registration; strict supervision
for the first 2 years in the event of re-registration and payment of costs in the amount of $15,000.

Part 8 – Principal Trading
July 27, 2023

UMIR 8.1-5

Universal Market Integrity Rules

Rules & Policies

PART 9 – TRADING HALTS, DELAYS AND SUSPENSIONS
9.1

Regulatory Halts, Delays and Suspensions of Trading
(1)

(2)

(3)

Regulatory Halts and Suspensions - No order for the purchase or sale of a security
or a derivative shall be executed on a marketplace or over-the-counter, at any time
while:(a)an order of a securities regulatory authority to cease trading in the security,derivative, related security or related derivative remains in effect;(b)in the case of a listed security or a listed derivative, the Market Regulator of
the Exchange on which the security or derivative is listed has halted orsuspended trading in the security or derivative while such halt or suspension
remains in effect;(c)in the case of a quoted security, the Market Regulator of the QTRS has halted
or suspended trading in the security while such halt or suspension remains ineffect; and(d)in the case of any security other than a listed security or a quoted security, aMarket Regulator of an ATS on which such security may trade has halted
trading for the purposes of the public dissemination of material information
respecting such security or the issuer of such security.

Regulatory Delay - No order for the purchase or sale of a security or derivative shallbe executed on a marketplace or over-the-counter, at any time while:(a)in the case of a listed security or a listed derivative, the Market Regulator of
the Exchange on which the security or derivative is listed has delayed tradingin the security or derivative while such delay remains in effect; and(b)in the case of a quoted security, the Market Regulator of the QTRS has delayed
trading in the security while such delay remains in effect.

Exceptions for Non-Regulatory Purposes - Despite subsections (1) and (2), an
order may be entered on a marketplace or an order may trade on a marketplace, if
the Exchange or QTRS has:
(a)

(b)

suspended trading in the security or derivative by reason only that the issuerof the security or underlying security has:(i)ceased to meeting listing or quotation requirements established by the
Exchange or QTRS, or(ii)

failed to pay to the Exchange or QTRS any fees in respect of the listingor quotation of securities of the issuer or underlying securities of a
derivative; ordelayed or halted trading in the security or the derivative as a result of:Part 9 – Trading Halts, Delays and Suspensions
March 1, 2023

UMIR 9.1-1

(4)

(i)

technical problems affecting only the trading system of the Exchange or
QTRS, or(ii)

the application of a Marketplace Rule.

Trading Outside Canada During Regulatory Halts, Delays and Suspensions –
(a)

(b)

Defined Terms:

If trading in a security has been prohibited on a marketplace in accordancewith clauses (1)(b), (c) or (d) or subsection (2), a Participant may execute a
trade in the security, if permitted by applicable securities legislation, outsideof Canada on a foreign organized regulated market;
If trading in a security has been prohibited on a marketplace under clause
1(a), a Participant may execute a sale in the security on a foreign organizedregulated market if:(i) all conditions set forth in the order of a securities regulatory authority aremet, and(ii) the sale is in accordance with applicable securities legislation.
NI 14-101 section 1.1(3) – “securities legislation” and “securities regulatory authority”
NI 21-101 section 1.1 – “ATS” and “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “derivative”, “Exchange”, ‘foreign organized regulated market”, “listed derivative”,“listed security”, “Market Regulator”, “marketplace”, “Marketplace Rules”, “Participant”, “quoted
security”, “QTRS”, “related derivative”, “related security”
UMIR section 1.2(2) – “trade”

Regulatory History:

Effective August 27, 2004, the applicable securities commissions approved an amendment tosubsection (1) to delete the phase “entered on a marketplace or” immediately prior to the word
“executed”. See Market Integrity Notice 2004-022 – “Order Entry During a Regulatory Halt” (August27, 2004).
Effective May 16, 2008, the applicable securities commissions approved an amendment to subsection(4) to replace the phrase “an exchange or organized regulated market outside of Canada that publicly
disseminates details of trades executed on that market” with “a foreign organized regulated market”.
See Market Integrity Notice 2008-008 – “Provisions Respecting ‘Off-Marketplace’ Trades” (May16,2008).
Effective December 14, 2022, the applicable securities commissions approved amendments to UMIR
9.1. See IIROC Notice 22-0140– “Amendments Respecting the Trading of Derivatives on aMarketplace (September 15, 2022).
Effective March 1, 2023, the applicable securities commissions approved amendments to UMIR
9.1(4)(b) to allow Participants to sell a listed security on a foreign organized regulated market duringa regulatory halt where a cease trade order is in effect and the selling is permitted pursuant to theconditions in the CTO. See Notice 22-0185 - Amendments Respecting the Codification of Certain
UMIR Exemptions (December 1, 2022).

Guidance:

See Market Integrity Notice 2002-012 – “Regulation ID Order Markers and Order Inhibition during
Regulatory Halts & Suspensions” (July 9, 2002).

Guidance:

See Market Integrity Notice 2005-035 – “Regulatory Halts and Marketplace Hours of Operation”(December 8, 2005).

Guidance:

See IIROC Notice 13-0059 – “Guidance on Market-wide Circuit Breakers” (February 21, 2013).

Guidance:

See Notice 23-0006 – “Additional Guidance Respecting Application of Single-Stock Circuit Breakers”(January 19, 2023).

Technical:

See Notice 22-0186 – “Obtaining a Trading Exemption or Rule Interpretation” (December 1, 2022).

Part 9 – Trading Halts, Delays and Suspensions
March 1, 2023

UMIR 9.1-2

Universal Market Integrity Rules

Rules & Policies

PART 10 – COMPLIANCE
10.1

Compliance Requirement(1)

Each Participant and Access Person shall comply with applicable Requirements.

(2)

For the purposes of subsection (1), a Participant or Access Person shall, withrespect to a particular order, comply with the Marketplace Rules of:(a)the marketplace on which the particular order is entered; and(b)the marketplace on which the particular order is executed.

(3)

Each marketplace shall comply with the applicable Requirements, the Market
Operation Instrument and any other applicable securities regulatory requirements.

(4)

The Market Regulator shall promptly report to the applicable securities regulatory
authorities, if the Market Regulator believes that a marketplace has failed tocomply with the requirements of subsection (3) or has otherwise engaged in
misconduct or apparent misconduct.

(5)

A Subject Person shall not do any act that the Subject Person knows or could have
known after the exercise of reasonable diligence would impede or obstruct theability of a Market Integrity Official to exercise a power under Rule 10.9.

(6)

Without limiting the generality of subsection (5), a Subject Person shall beconsidered to have impeded or obstructed the ability of a Market Integrity Official toexercise a power if the Subject Person:(a)destroys or renders inaccessible any document in the possession or controlof the Subject Person, whether or not the document is of the form or type thatmust be retained in accordance with Rule 10.12, that is relevant to theexercise of power;(b)

provides any information, document, record or statement to the Market
Integrity Official in connection with the exercise of a power that is misleadingor untrue or does not state a fact that is required to be stated or that isnecessary to make the information, document, record or statement not
misleading; or(c)persuades or attempts to persuade any person by whatever means to:Part 10 - Compliance
January 1, 2023

(i)

destroy or render inaccessible any document in the possession orcontrol of that other person relevant to the exercise of power, or(ii)

provide any information, document, record or statement to the Market
Integrity Official in connection with the exercise of a power that would
UMIR 10.1-1

(iii)(7)

be misleading or untrue or would not state a fact that is required to bestated or that is necessary to make the information, document, record orstatement not misleading.

Without limiting the availability of other defenses, a Subject Person shall not be
considered to have breached subsection (5) or (6) if the Subject Person did notknow or could not have known after the exercise of reasonable diligence that:(a)the document was relevant to the exercise of a power; or(b)

the information, document, record or statement was or would be misleadingor untrue or that it omitted to state a fact that was required to be stated or thatwas necessary to make the information, document, record or statement not
misleading in light of the circumstance in which it was made or would be
made.

POLICY 10.1 – COMPLIANCE REQUIREMENTPart 1 – Monitoring for Compliance
Rule 10.1 requires each Participant and Access Person to comply with applicable
Requirements. The term “Requirements” is defined as meaning:
•

UMIR;

•

the Policies;•

the Trading Rules;•

the Marketplace Rules;•

any direction, order or decision of the Market Regulator or a Market Integrity Official; and•securities legislation,as amended, supplemented and in effect from time to time.
The Market Regulator will monitor the activities of Subject Persons for compliance with each
aspect of the definition of Requirements and use the powers under Corporation Rule 8100 to
conduct any enforcement investigation into possible non-compliance. If the Subject Person has
not complied with:•

UMIR, the Policies or any direction, order or decision of the Market Regulator or aMarket Integrity Official, the Market Regulator may undertake a disciplinary proceeding
pursuant to Corporation Rule 8200 or Rule 10.5 with respect to temporary restriction ofaccess;•the Trading Rules or securities legislation, the Market Regulator may, pursuant to theexchange of information provided for under Rule 10.13, refer the matter to the applicablesecurities regulatory authority to be dealt with in accordance with applicable securities
legislation; and•Marketplace Rules, the Market Regulator may undertake a disciplinary proceeding
pursuant to Corporation Rule 8200 or Rule 10.5 with respect to temporary restriction ofaccess, if the marketplace has retained the Market Regulator to conduct disciplinary
proceedings on behalf of the marketplace in accordance with an agreement with theMarket Regulator contemplated by Part 7 of the Trading Rules, otherwise the Market

Part 10 - Compliance
January 1, 2023

UMIR 10.1-2

Regulator may refer the matter to the marketplace to be dealt with in accordance with
the Marketplaces Rules of that marketplace.
Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation” and “securities regulatory authority”
NI 21-101 section 1.1 – “order”
UMIR section 1.1 – “Access Person”, “document”, “Market Integrity Official”, “Market Regulator”,“Market Operation Instrument”, “marketplace”, “Marketplace Rules”, “Participant”, “Policy”, “Subject
Person”, “Requirements”, “Trading Rules” and “UMIR”

Regulatory History:

Effective March 11, 2005, the applicable securities commissions approved amendments to Rule 10.1 toadd subsections (5), (6) and (7). See Market Integrity Notice 2005-008 – “Provisions Respecting
Impeding or Obstructing a Market Regulator” (March 11, 2005).
Effective April 1, 2005, the applicable securities commissions approved amendments to add Part 1 of
Policy 10.1. See Market Integrity Notice 2005-011 – “Provisions Respecting Manipulative andDeceptive Activities” (April 1, 2005).
In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to Part 1 of Policy 10.1 that came into force on June 1, 2008 to
replace the phrase “these Rules” with “UMIR”. See Footnote 1 in Status of Amendments.
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French version of
UMIR” (December 9, 2013).
Effective September 1, 2016, the applicable securities commissions approved amendments to Rule10.1 and Policy 10.1, which include the repeal of provisions referencing compliance with the conduct of“investigations and hearings” by IIROC, as the obligation will be included in the consolidated
compliance examinations rule 9100 and enforcement investigations and proceedings rules 8100 and
8200. See IIROC Notice 16-0122 – “Implementation of the consolidated IIROC Enforcement,
Examination and Approval Rules” (June 9, 2016).

Partially Repealed Guidance:

See Market Integrity Notice 2006-020 – “Compliance Requirements for Trading on Multiple
Marketplaces” (October 30, 2006). Questions 5, 7 and 9 in Market Integrity Notice 2006-020
were repealed and replaced by Market Integrity Notice 2008-010 – “Complying with “Best
Price” Obligations” (May 16, 2008). Question 3 in Market Integrity Notice 2006-020 was
repealed and replaced by IIROC Notice 12-0236 – “Guidance on Marketplace Disclosure
for Trade Confirmations” (July 27, 2012). Questions 4, 6, 10, 11 of MIN 2006-020 wererepealed and replaced effective January 2, 2018 by IIROC Notice 17-0138 – “Guidance on
Best Execution” (July 6, 2017).

Repealed Guidance:

See IIROC Notice 12-0236 – “Guidance on Marketplace Disclosure for Trade Confirmations” (July27, 2012). This notice was repealed and replaced by IIROC Notice 13-0283 – “Guidance on
Marketplace and Average Price Disclosure for Trade Confirmations” (November 25, 2013).

Guidance:

See IIROC Notice 13-0283 – “Guidance on Marketplace and Average Price Disclosure for Trade
Confirmations” (November 25, 2013).

Disciplinary Proceedings:

In the Matter of Robert Horner (“Horner”) (February 26, 2004) SA 2004-003
Facts – Between November 1999 and March 2000, Horner was the responsible broker for two
separate normal course issuer bids (“NCIBs”). Client X, an insider of both companies, engaged in apractice of making purchases of shares of both companies for his personal account at prices higher
than the last independent trade. Client X then made purchases pursuant to the NCIBs at the upticked prices.
Disposition – Trades made directly or indirectly for the account of an insider do not constitute“independent trades” for the purposes of establishing “last independent trade” in the context ofNCIBs. As the designated broker, Horner had the responsibility to ensure all trades made in
relation to the NCIBs were in compliance with applicable rules.
Requirements Considered - Section 23.16 of the General By-Law of the TSX, Section 9 of PartXXVIII of the Policies of the TSX and Rule 6-501 and Policy 6-501(9) of the TSX. Comparable
UMIR Provision Rule 10.1
Sanction – $25,000 fine, costs of $12,000 and disgorgement of $5,220

Disciplinary Proceedings:

In the Matter of Rhonda Hymers (“Hymers”) (March 11, 2004) SA 2004-004
Facts – Between November 1999 and March 2000, Hymers, a licensed assistant, entered trades onbehalf of client X in relation to a normal course issuer bids (“NCIBs”) for two different companies.
Client X, who was an insider of both companies, engaged in a practice of making purchases ofshares of the companies for his personal account at prices higher than the last independent trade.
Client X then made purchases pursuant to the NCIBs at the up-ticked prices. Hymers entered trades

Part 10 - Compliance
January 1, 2023

UMIR 10.1-3

in respect of these transactions.
Disposition – Trades made directly or indirectly for the account of an insider do not constitute‘”independent trades” for the purposes of establishing “last independent trade” in the context ofNCIBs. In her capacity as a licensed assistant, Hymers had the responsibility to ensure all trades
made in relation to the NCIBs were in compliance with applicable rules.
Requirements Considered - Section 23.16 of the General By-Law of the TSX, Section 9 of PartXXVIII of the Policies of the TSX and Rule 6-501 and Policy 6-501(9) of the TSX. Comparable
UMIR Provision – Rule 10.1
Sanction – $12,500 fine and costs of $2,000
Disciplinary Proceedings: Rule 10.1 was considered In the Matter of Lakeshore Securities Inc. (“Lakeshore”) (November
11, 2014) DN 14-0262. See Disciplinary Proceedings under Rule 7.1.
Disciplinary Proceedings: In the Matter of Hampton Securities Ltd. (“Hampton”) (August 4, 2017) DN 17-0163
Facts – Between May and November 2012 and between January and June 2013, Hampton allowed
direct market access to a client without fully complying with the applicable marketplace rules
Disposition – Pursuant to a Settlement Agreement, Hampton admitted that that it failed to comply
with UMIR 10.1 by allowing direct market access to a client without fully complying with theapplicable marketplace rules.
Requirements Considered – Rule 10.1.
Sanction – Hampton agreed to pay a fine of $20,000 and to pay costs in the amount of $1,500.

Part 10 - Compliance
January 1, 2023

UMIR 10.1-4

Universal Market Integrity Rules

Rules & Policies

10.2

Investigations - Repealed

Defined Terms:

UMIR section 1.1 – “Access Person”, “document”, “employee”, “Exchange”, “hearing”, “Hearing Panel”,“Market Regulator”, “Participant”, “QTRS” and “Regulated Person”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective March 11, 2005, the applicable securities commissions approved amendments to section 10.2.
See Market Integrity Notice 2005-008 – “Provisions Respecting Impeding or Obstructing a Market
Regulator” (March 11, 2005).
Effective September 1, 2016, the applicable securities commissions approved an amendment to section
1.1 to repeal Rule 10.2 of UMIR concerning investigations as the subject will be covered by the
consolidated investigations rule 8100. See IIROC Notice 16-0122 – “Implementation of theconsolidated IIROC Enforcement, Examination and Approval Rule” (June 9, 2016).

Part 10 - Compliance
September 1, 2016

UMIR 10.2-1

Universal Market Integrity Rules

Rules & Policies

10.3 Extension of Responsibility - Repealed
Defined Terms:

UMIR section 1.1 – “Access Person”, “employee”, “Market Regulator”, “Participant” and “Requirements”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective January 30, 2004, the applicable securities commissions approved an amendment to Rule10.3 to:(a) renumber existing subsection (4) as subsection (5); and(b) insert a new subsection (4).
See Market Integrity Notice 2004-005 - “Administrative and Editorial Amendments” (January 30,2004).
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See Notice 13-0294 – Notice of Approval and Implementation –“Amendments to the French version of UMIR” (December 9, 2013).
Effective September 1, 2016, the applicable securities commissions approved an amendment to repeal
Rule 10.3 of UMIR as it will be replaced by consolidated rule 1403. See IIROC Notice 16-0122 –“Implementation of the consolidated IIROC Enforcement, Examination and Approval Rules”(June 9, 2016).

Disciplinary Proceedings:

Rule 10.3(4) was considered In the Matter of Zoltan Horcsok (“Horcsok”) (July 18, 2005) SA
2005-003. See Disciplinary Proceedings under 7.1.

Disciplinary Proceedings:

Rule 10.3(4) was considered In the Matter of Glen Grossmith (“Grossmith”) (July 18, 2005) SA
2005-004. See Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

Rule 10.3(1) and 10.3(4) was considered In the Matter of Scotia Capital Inc. (“Scotia”) (February
26, 2007) DN 2007-001. See Disciplinary Proceedings under Rule 6.4.

Disciplinary Proceedings:

Rule 10.3(4) was considered In the Matter of Steve Horrocks (“Horrocks”) (August 5, 2009) DN
09-0229. See Disciplinary Proceedings under Rule 8.1.

Disciplinary Proceedings:

Rule 10.3(4) was considered In the Matter of Clark Alexander Squires (“Squires”) (October 6,2010) DN 10-0263. See Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

Rule 10.3(4) was considered In the Matter of National Bank Financial (“NBF”), Paul Clarke(“Clarke”) and Todd O’Reilly (“O’Reilly”) (January 21, 2011) DN 11-0029 and DN 11-0030. See
Disciplinary Proceedings under Rule 2.1.

Part 10 - Compliance
September 1, 2016

UMIR 10.3-1

Universal Market Integrity Rules

Rules & Policies

10.4

Extension of Restrictions
(1)

(2)

A related entity of a Participant and a director, officer, partner or employee of theParticipant or a related entity of the Participant shall:(a)comply with the provisions of UMIR and any Policies with respect to specificunacceptable activities, manipulative and deceptive activities, short sales andfrontrunning as if references to “Participant” in Rules 2.1, 2.2, 2.3, 3.1 and 4.1
included reference to such person; and(b)in respect of the failure to comply with the provisions of UMIR and the
Policies referred to in clause (a), be subject to the practice and procedures
and to penalties and remedies set out in this Part.

A related entity of an Access Person and a director, officer, partner or employee ofthe Access Person or a related entity of the Access Person shall in respect oftrading on a marketplace on behalf of the Access Person or related entity of theAccess Person:(a)comply with the provisions of UMIR and any Policies with respect to specificunacceptable activities, manipulative and deceptive activities and short sales
as if references to “Access Person” in Rules 2.1, 2.2, 2.3 and 3.1 included
reference to such person; and(b)in respect of the failure to comply with the provisions of UMIR and the
Policies referred to in clause (a), be subject to the practice and procedures
and to the penalties and remedies set out in this Part.

(3)

If, in the opinion of a Market Regulator, a particular person to whom UMIR applies,
including any particular person to whom UMIR has been extended in accordancewith subsection (1) and (2), has organized their business and affairs for the
purpose of avoiding the application of any provision of UMIR, the Market Regulator
may designate any person involved in such business and affairs as a person acting
in conjunction with the particular person.

(4)Upon a Market Regulator making a designation in accordance with subsection (3),the Market Regulator shall provide notice of such designation to:(a)the particular person;(b)

the designated person;(c)each Market Regulator; and(d)each applicable securities regulatory authority.

Part 10 - Compliance
September 1, 2016

UMIR 10.4-1

Defined Terms:

NI 14 101 section 1.1(3) – “securities regulatory authority”
UMIR section 1.1 – “Access Person”, “employee”, “Market Regulator”, “marketplace”, “Participant”,“Policy”, “related entity”, “short sale” and “UMIR”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective April 1, 2005, the applicable securities commissions approved amendments to Rule 10.4 inclause (1) (a) and (2)(a) to add reference to Rule 2.3 and substitute “activities” for “method of trading”.
See Market Integrity Notice 2005-011 – “Provisions Respecting Manipulative and Deceptive
Activities” (April 1, 2005).
In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved amendments to Rule 10.4 that came into force on June 1, 2008 to makeeditorial changes. See Footnote 1 in Status of Amendments.
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 - “Amendments to the French version of UMIR”(December 9, 2013).
Effective September 1, 2016, the applicable securities commissions approved amendments to makeeditorial changes to Rule 10.4. See IIROC Notice 16-0122 – “Implementation of the consolidated
IIROC Enforcement, Examination and Approval Rules” (June 9, 2016).

Disciplinary Proceedings:

Rule 10.4(1)(a) was considered In the Matter of David Avery Little (“Little”) (December 22,2003) OOS 2003-014. See Disciplinary Proceedings under 2.1.

Disciplinary Proceedings:

Rule 10.4(1)(a) was considered In the Matter of Gerald Douglas Phillips (“Phillips”) (February
26, 2004) SA 2004-002. See Disciplinary Proceedings under 2.1.

Disciplinary Proceedings:

Rule 10.4(1)(a) was considered In the Matter of Louis Anthony De Jong (“DeJong”) andDwayne Barrington Nash (“Nash”) (July 29, 2004) Decision 2004-004. See Disciplinary
Proceedings under 2.1.

Disciplinary Proceedings:

Rule 10.4(1)(a) was considered In the Matter of Glen Grossmith (“Grossmith”) (July 18, 2005)
SA 2005-004. See Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

Rule 10.4(1)(a) was considered In the Matter of W. Scott Leckie (July 19, 2005) SA 2005-005.
See Disciplinary Proceedings under Rule 2.2.

Disciplinary Proceedings:

Rule 10.4(1)(a) was considered In the Matter of Ian Macdonald, Edward Boyd, Peter Dennis andDavid Singh (July 28, 2005) SA 2005-006. See Disciplinary Proceedings under Rule 2.2.

Disciplinary Proceedings:

Rule 10.4(1) was considered In the Matter of Martin Fabi (“Fabi”) (October 27, 2008) DN 080159. See Disciplinary Proceedings under Rule 2.2.

Disciplinary Proceedings:

Rule 10.4(1) was considered In the Matter of Tony D’Ugo (“D’Ugo”) (April 6, 2010) DN 10-0093.
See Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

Rule 10.4(1) was considered In the Matter of Francesco Mauro (“Mauro”) and Scott Fraser

Disciplinary Proceedings:

Rule 10.4(1) was considered In the Matter of James Martin MacMenamin (“MacMenamin”)(June 3, 2010) DN 10-0162. See Disciplinary Proceedings under Rule 2.2.

Disciplinary Proceedings:

Rule 10.4(1) was considered In the Matter of National Bank Financial (“NBF”), Paul Clarke(“Clarke”) and Todd O’Reilly (“O’Reilly”) (January 21, 2011) DN 11-0029 and DN 11-0030. See
Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

Rule 10.4(1) was considered In the Matter of Gary John Williamson (“Williamson”) (February
28, 2011) DN 11-0085. See Disciplinary Proceedings under Rule 2.2.

Disciplinary Proceedings:

Rule 10.4(1) was considered In the Matter of Donald Dean MacKenzie (“MacKenzie”) (May 12,2011) DN 11-0152. See Disciplinary Proceedings under Rule 2.2.

Disciplinary Proceedings:

Rule 10.4(1) was considered In the Matter of David Charles Parkinson (“Parkinson”) (February
22, 2012) DN 12-0061. See Disciplinary Proceedings under Rule 2.2.

Disciplinary Proceedings:

Rule 10.4 was considered In the Matter of William Geddes (“Geddes”) (March 15, 2012) DN 120098. See Disciplinary Proceedings under Rule 2.2.

Part 10 - Compliance
September 1, 2016

Harding (“Harding”) (May 25, 2010) DN 10-0149. See Disciplinary Proceedings under Rule 2.2.

UMIR 10.4-2

Universal Market Integrity Rules

Rules & Policies

10.5

Suspension or Restriction of Access(1)

If the Market Regulator has determined that a Subject Person, other than amarketplace for which the Market Regulator is or was the regulation services
provider, has engaged in, or may engage in, any course of conduct that is or may
be a contravention of a Requirement, the Market Regulator may, if the Market
Regulator considers it is necessary for the protection of the public interest by aninterim order without notice or hearing, order the restriction or suspension ofaccess to the marketplace upon such terms and conditions, if any, consideredappropriate provided such interim order shall expire 15 days after the date on
which the interim order is made unless:(a)a hearing is commenced pursuant to Corporation Rule 8200 (Enforcement
Proceedings) within that period of time to confirm or set aside the interim
order;(b)

the person against which the interim order is made consents to an extensionof the interim order until a hearing of the matter is held; or(c)an applicable securities regulatory authority directs that the interim order be
rescinded or extended.

(2)

For the purposes of this section, the restriction, suspension or revocation of accessof a person to a marketplace may be imposed directly on the person and, if theperson is an individual, the restriction, suspension or revocation of access may
also be imposed in respect of their capacity as a director, officer, partner,
employee or associate of a person with access to a marketplace.

(3)

For greater certainty, any enforcement or disciplinary proceeding or any order orinterim order as against a person by a Market Regulator for contravention of a
Requirement shall not affect or limit any enforcement or disciplinary action as
against the person by any securities regulatory authority, self-regulatory entity orother Market Regulator with jurisdiction over the person.

(4)

If a Market Regulator restricts, suspends or revokes the access of any person to amarketplace in accordance with this section, such person shall be denied access toany other marketplace and shall have any access to any other marketplace
automatically restricted, suspended or revoked unless the applicable securities
regulatory authority otherwise determines in a review or appeal of the order orinterim order of the Market Regulator undertaken in accordance with Rule 11.3.

Part 10 - Compliance
January 1, 2023

UMIR 10.5-1

(5)If a Market Regulator restricts, suspends or revokes the access of any person to amarketplace, the Market Regulator shall provide notice forthwith of such restriction,suspension or revocation to:(a)the person whose access has been restricted, suspended or revoked;(b)each marketplace;(c)each Market Regulator; and(d)each applicable securities regulatory authority.

Defined Terms:

NI 14 101 section 1.1(3) – “securities regulatory authority”
NI 21-101 section 1.1 – “regulation services provider” and “self-regulatory entity”
UMIR section 1.1 – “employee”, “Market Regulator”, “marketplace”, “Subject Person” and“Requirements”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective September 1, 2016, the applicable securities commissions approved amendments to Rule 10.5
which include the repeal of subsection (1) as it will be replaced by the consolidated rule 8209. See
IIROC Notice 16-0122 – “Implementation of the consolidated IIROC Enforcement, Examination
and Approval Rules” (June 9, 2016).

Disciplinary Proceedings:

In the Matter of Global Securities Corporation (“Global”) (June 20, 2003) Decision 2003-004
Facts – Between May 1, 1997 and January 31, 1998, Global failed to diligently supervise its
employees. The Committee found that the infractions alleged against Global were proven. A
number of prior settlement agreements approved by either the Alberta Stock Exchange or the
Vancouver Stock Exchange which had been place before a prior committee of the TSX Venture
Exchange where not approved.
The only issue before the current Committee was theappropriateness of the penalty to be levied against Global.
Held - The fact that Global suffered a loss of approximately $1.7 million as a result of the conduct of
the investment advisors was not in the view of the Committee a factor of significant weight. In
considering an appropriate penalty, the Committee looked at earlier unrelated settlementagreements.
Comparable UMIR Provision – Rule 10.5
Sanction - $135,000 fine and costs of $12,000; disgorgement of $4,330 in profits

Disciplinary Proceedings:

In the Matter of Global Securities Corporation (“Global”), Robert Semple (“Semple”), Robert
Tassone (“Tassone”) and Bruce McConnachie (“McConnachie”) (January 5, 2004) Decision
2004-001
Facts - Between November 1994 and August 1996, Semple and Tassone, while approved persons
at Global failed to ensure that their recommendations were suitable for their clients and also
provided advice respecting options trading without being qualified. McConnachie, who was the
Branch Manager, failed to diligently supervise the trading that was carried out by Semple andTassone in the clients’ accounts. Semple and Tassone repaid all of the commissions and losses,with interest and penalty, to the clients, and have been placed under strict supervision for a periodof seven years. They have also paid significant legal fees in connection with the related civil action
launched by the clients. Based on the above, they submit that they should not have to pay theadditional fines levied by the Canadian Venture Exchange.
Held – In light of the adverse impact of being under strict supervision, damage to their reputations,and other factors which Tassone and Semple have suffered as a result of this matter, the Panelordered that the sanctions imposed on both men be reduced. Due to unrelated personal mattersaffecting McConnachie, his fine was also reduced.
Comparable UMIR Provision – Rule 10.5
Sanction –Semple -Part 10 - Compliance
January 1, 2023

$15,000 fine and costs of $10,000; successful rewrite of the Conduct and
UMIR 10.5-2

Practices Handbook examination
Tassone -$10,000 fine and costs of $10,000; successful rewrite of the Conduct andPractices Handbook examination

McConnachie - $20,000 fine and costs of $5,000; successful rewrite of the Branch
Examination

Part 10 - Compliance
January 1, 2023

Manager’s

UMIR 10.5-3

Universal Market Integrity Rules

Rules & Policies

10.6

Exercise of Authority - Repealed

Defined Terms:

UMIR section 1.1 – “hearing”, “Hearing Panel” and “Market Regulator”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to repeal and replace Rule 10.6 that came into force June 1,
2006. See Footnote 1 of Status of Amendments. Prior to that date, Rule 10.6 read as follows:(1)

A Hearing Panel shall make any determination, hold any hearing and make any order or interim
order required or permitted of a Market Regulator under this Part.

(2)

A member of the Hearing Committee shall not be a member of any Hearing Panel with respect toany matter if the member:(a)is an officer, partner, director, employee or an associate of any person that is asubject of the hearing, order or interim order; and(b)

has such other relationship to the person or matter as may be reasonably considered
to give rise to a potential conflict of interest.

Effective September 1, 2016, the applicable securities commissions approved an amendment to repeal
Rule 10.6 of UMIR as it will be replaced by consolidated rules 8203 and 8205. See IIROC Notice 160122 – “Implementation of the consolidated IIROC Enforcement, Examination and Approval
Rules” (June 9, 2016).

Part 10 - Compliance
September 1, 2016

UMIR 10.6-1

Universal Market Integrity Rules

Rules & Policies

10.7

Assessment of Expenses - Repealed

Defined Terms:

UMIR section 1.1 – “Market Regulator” and “Regulated Person”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective January 30, 2004, the applicable securities commissions approved an amendment tosubsection (2) of Rule 10.7 to add the phrase “acting reasonably,” before the word “determines”. See
Market Integrity Notice 2004-005 – “Administrative and Editorial Amendments” (January 30, 2004).
Effective September 1, 2016, the applicable securities commissions approved an amendment to repeal
Rule 10.7 of UMIR as it will be replaced by consolidated rule 8214. See IIROC Notice 16-0122 –“Implementation of the consolidated IIROC Enforcement, Examination and Approval Rules”(June 9, 2016).

Part 10 - Compliance
September 1, 2016

UMIR 10.7-1

Universal Market Integrity Rules

Rules & Policies

10.8 Practice and Procedure - Repealed
POLICY 10.8 - PRACTICE AND PROCEDURE - REPEALEDDefined Terms:

UMIR section 1.1 – “document”, “employee”, “Market Regulator”, “Policy”, “Requirements” and “UMIR”
UMIR section 1.2(2) – “person”
UMIR Policy 10.8 section 1.1 – “applicant”, “electronic hearing”, “oral hearing”, “party”, “Secretary” and“written hearing”

Regulatory History:

Effective January 30, 2004, the applicable securities commissions approved amendments to Policy 10.8
to add subsections (1), (2) and (3) of section 9.7 of Policy 10.8. See Market Integrity Notice 2004-004 –“Public Access to Hearings” (January 30, 2004).
Effective January 7, 2005, the applicable securities commissions approved amendments to Policy 10.8.
See Market Integrity Notice 2005-002 – “Practice and Procedure” (January 7, 2005).
Effective March 11, 2005, the applicable securities commissions approved amendments to Policy 10.8
to repeal the definition of “document”. See Market Integrity Notice 2005-008 – “Provisions Respecting
Impeding or Obstructing a Market Regulator” (March 11, 2005). Prior to that date, the definition
provided:"document" includes a sound recording, videotape, film, photographs, chart, graph, map,plan, survey, book of account, and information recorded or stored by means of any
device.
In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved amendments to Policy 10.8 that came into force on June 1, 2008. See Footnote
1 of Status of Amendments.
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 – “Amendments to the French version of UMIR”(December 9, 2013).
Effective September 1, 2016, the applicable securities commissions approved amendments to Rule10.8 and Policy 10.8, which include the repeal of Rule 10.8, as it will be replaced by consolidated rule
8401. See IIROC Notice 16-0122 – “Implementation of the consolidated IIROC Enforcement,
Examination and Approval Rules” (June 9, 2016).
Effective November 16, 2017, the applicable securities commissions approved housekeeping
amendments to Policy 10.8, which include the repeal of Policy 10.8. See IIROC Notice 17-0224 –“Housekeeping amendments to the IIROC Consolidated Enforcement, Examination and Approval
Rules” (November 16, 2017).

Disciplinary Proceedings:

In the Matter of Steven James Regoci (“Regoci”) and David Stanley Chernoff (“Chernoff”)(April 21, 2004) Decision 2004-003
Facts - On July 16, 2003, TSX Venture Exchange Inc. (TSXV”) released a Notice of Hearing which
named Regoci and Chernoff. The purpose of the hearing was to determine whether Chernoff and
Regoci contravened Vancouver Stock Exchange Rules (“VSE”) and Alberta Stock Exchange(“ASE”) By-Laws. During the relevant period, both Regoci and Chernoff were within the jurisdictionof the VSE and ASE. The jurisdictions of those bodies was assumed, effective November 29, 1999,
by the Canadian Venture Exchange Inc. (now TSXV). After a pre-hearing conference and prior tothe hearing date, the TSX withdrew its Notice of Hearing and took the position that the subject
matter of the allegations would be referred to the British Columbia Securities Commission. Counsel
for Chernoff objected, asserting that the TSXV could not unilaterally withdraw the Notice of hearing
and that the panel should instead dismiss the matter.
Held – Subject to specific circumstances, which are satisfied in this matter, the TSXV has theauthority to unilaterally withdraw a Notice of Hearing.
Comparable UMIR Provision – Rule 10.8.

Part 10 – Compliance
November 30, 2017

UMIR 10.8-1

Universal Market Integrity Rules

Rules & Policies

10.9

Power of Market Integrity Officials(1)

A Market Integrity Official may, in governing trading in securities or derivatives on themarketplace:(a)delay, halt or suspend trading in a security or a derivative at any time and forsuch period of time as such Market Integrity Official may consider appropriate
in the interest of a fair and orderly market;(b)refuse to allow any bid price or ask price to be recorded at any time if, in theopinion of such Market Integrity Official, such quotation is unreasonable or notin compliance with UMIR or any Policy;(c)settle any dispute arising from trading in securities or derivatives on themarketplace where such authority is not otherwise provided for in any
requirement governing trading on the marketplace;(d)vary or cancel any trade which, in the opinion of such Market Integrity Official,is unreasonable or not in compliance with UMIR or any Policy;(e)vary or cancel any trade upon application of the buyer and seller provided suchapplication has been made by the end of trading on the day following the dayon which the trade was made or such earlier time as may be established in any
Marketplace Rule of the marketplace on which the trade was executed;(f)

in respect of any trade which has not complied with the requirements of Part 5,
correct the price of the trade to a price at which the trade would have compliedwith such requirement, or(g)require the Participant or Access Person to satisfy any order included in thedisclosed volume if the trade by the Participant or Access Person failed tocomply with requirements of section 6.4 of the Trading Rules;(g.1) in respect of any trade of a principal order or non-client order that has notcomplied with the requirements of Rule 5.3, require the Participant to satisfy
the client order at the price and up to the volume of the trade which failed tocomply with the requirements of Rule 5.3.
(h)provide to any person an interpretation of any provision of UMIR and any Policyin accordance with the purpose and intent of the provision and shall ensure thatany such interpretation is observed by such person;(i)limit trading to liquidation of a position in a listed derivative only;(j)order liquidation of a position in a listed derivative in all or a portion of an
account;(k)

restrict trading in a listed derivative to a specific price range;(l)exercise such powers as are specifically granted to a Market Regulator orMarket Integrity Official by UMIR and any Policy; and(m) exercise such powers as are specifically granted to the Market Regulator by
the marketplace where the marketplace is entitled to grant such powers.

Part 10 - Compliance
December 14, 2022

UMIR 10.9-1

(2)In determining whether any quotation or trade in a security is unreasonable, theMarket Regulator shall consider:(a)prevailing market conditions;(b)the last sale price of(i) the security as displayed in a consolidated market display, or(ii) the derivative as displayed on a marketplace;

(3)

(4)

(c)

patterns of trading in the security or derivative on the marketplace including
volatility, volume and number of transactions;(d)whether material information concerning the security or underlying security of a
derivative is in the process of being disseminated to the public; and(e)the extent of the interest of the person for whose account the order is enteredin changing the price or quotation for the security or derivative.

In connection with the exercise of a power under this Rule, upon the verbal, written
or electronic request of the Market Integrity Official, the Subject Person shall, within
the time period specified by the Market Integrity Official:(a)provide any information, document or records in the possession or control ofthe person that the Market Regulator determines may be relevant to theexercise of a power by the Market Regulator and such information, document
or records shall be provided in such manner and form, including electronically,
as may be required by the Market Regulator; and(b)allow the inspection of, and permit copies to be taken of, any information,
document or records in the possession or control of the person that the Market
Regulator determines may be relevant to the exercise of a power by the Market
Regulator.

If a Market Integrity Official has provided notice to a Subject Person pursuant tosubsection (3), the Subject Person shall, notwithstanding any policy or procedure of
the Subject Person with respect to the retention of information, documents orrecords, retain any document or record in the possession or control of the Subject
Person that is relevant to the exercise of the power by the Market Integrity Official fora period of 30 days from the date of the notice or such other period as may be
specified by the Market Regulator.

Defined Terms:

NI 21-101 section 1.1 - “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “client order”, “consolidated market display”, “derivative” “disclosed volume”,“document”, “last sale price”, “listed derivative”, “Market Integrity Official”, “Market Regulator”,“marketplace”, “Marketplace Rules”, “non-client order”, “Participant”, “Policy”, “principal order”, “Subject
Person” and “UMIR”
UMIR section 1.2(2) – “person” and “trade”

Regulatory History:

Effective March 11, 2005, the applicable securities commissions approved amendments to section 10.9
to add subsections (3) and (4). See Market Integrity Notice 2005-008 – Notice of Amendment Approval –“Provisions Respecting Impeding or Obstructing A Market Regulator” (March 11, 2005).
Effective March 9, 2007, the applicable securities commissions approved an amendment to subsection

Part 10 - Compliance
December 14, 2022

UMIR 10.9-2

(1) of Rule 10.9 to replace the word “disallow” with the word “vary” in clause (d) and to add clause (g.1).
See Market Integrity Notice 2007-002 – “Provisions Respecting Competitive Marketplaces” (February
26, 2007).
Effective May 16, 2008, the applicable securities commissions approved an amendment to clause (g) ofsubsection (1) of Rule 10.9 to replace the phrase “volume of the trade which” with “disclosed volume if
the trade”. See Market Integrity Notice 2008-008 – “Provisions Respecting “Off-Marketplace” Trades”(May 16, 2008).
Effective December 9, 2013, the applicable securities commissions approved amendments to the French
version of UMIR. See IIROC Notice 13-0294 - “Rules Notice – Notice of Approval and
Implementation – UMIR – Amendments to the French version of UMIR” (December 9, 2013).
Effective September 18, 2015, the applicable securities commissions approved an amendment to clause(g) of subsection (1) of Rule 10.9. See IIROC Notice 15-0211 - Notice of Approval – “Provisions
Respecting Unprotected Transparent Marketplaces and the Order Protection Rule” (September 18,2015).
Effective September 1, 2016, the applicable securities commissions approved an amendment to makeeditorial changes to Rule 10.9. See IIROC Notice 16-0122 – “Implementation of the consolidated
IIROC Enforcement, Examination and Approval Rules” (June 9, 2016).
Effective December 14, 2022, the applicable securities commissions approved amendments to UMIR
10.9. See IIROC Notice 22-0140– “Amendments Respecting the Trading of Derivatives on aMarketplace” (September 15, 2022).
Guidance:

See IIROC Notice 12-0040 - “Guidance Note – UMIR - Guidance Respecting the Implementation ofSingle-Stock Circuit Breakers” (February 2, 2012).

Guidance:

See IIROC Notice 12-0258 - “Rules Notice – Guidance Note – UMIR – Guidance on Regulatory
Intervention for the Variation or Cancellation of Trades” (August 20, 2012).

Guidance:

See IIROC Notice 13-0297– “Variation and Cancellation of Odd Lot Trades” (December 10, 2013).

Partially Repealed Guidance: See IIROC Notice 14-0170 - “Guidance Respecting the Expansion of Single-Stock Circuit
Breakers” (July 10, 2014), which repeals and replaces IIROC Notice 12-0040. The method IIROC uses
to determine an actively-traded security set out in the “securities covered” section of Notice 14-0170 was
repealed and replaced by IIROC Notice 20-0009 – “Additional Guidance Respecting Securities
Covered by Single-Stock Circuit Breakers” (January 14, 2020).
Guidance:

Part 10 - Compliance
December 14, 2022

See IIROC Notice 20-0009 – “Additional Guidance Respecting Securities Covered by Single-Stock
Circuit Breakers” (January 14, 2020).

UMIR 10.9-3

Universal Market Integrity Rules

Rules & Policies

10.10

Report of Short Positions(1)

A Participant shall calculate, as of 15th day and as of the last day of eachcalendar month, the aggregate short position of each individual account inrespect of each listed security and quoted security.

(2)

Unless a Participant maintains the account in which an Access Person has theshort position in respect of a listed security or quoted security, the Access
Person shall calculate, as of the 15th day and as of the last day of eachcalendar month, the aggregate short position of the Access Person in respect ofeach listed security and quoted security.

(3)

Unless otherwise provided, each Participant and Access Person required to filea report in accordance with subsection (1) or (2) shall file a report of thecalculation with a Market Regulator in such form as may be required by theMarket Regulator not later than two trading days following the date on which thecalculation is to be made.

Defined Terms:

UMIR section 1.1 – “Access Person”, “listed security”, “Market Regulator”, “Participant”, “quoted security”
and “trading day”

Repealed Guidance:

Market Integrity Notice 2003-011 - “Short Position Reports” (May 27, 2003) pertained to the reporting of
short positions as required under Rule 10.10. This Notice was repealed and replaced effective
November 1, 2007 by Market Integrity Notice 2007-022 – “Guidance - Short Position Calculation andReporting” (October 29, 2007).

Repealed Guidance:

Market Integrity Notice 2003-016 - “Short Position Reports” (August 13, 2003) pertained to the reportingof short positions as required under Rule 10.10. This Notice was repealed and replaced effective
November 1, 2007 by Market Integrity Notice 2007-022 – “Guidance - Short Position Calculation andReporting” (October 29, 2007).

Guidance:

The reports of the adjustments to the Consolidated Short Position Reports were issued as Market
Integrity Notice 2003-019 - “Adjustments to Consolidated Short Position Report” (September 4,2003) for the report on the period ending August 31, 2003 and as Market Integrity Notice 2003-020 “Additional Adjustments to Consolidated Short Position Report” (September 23, 2003) for the reporton the period ending September 15, 2003.

Repealed Guidance:

Market Integrity Notice 2004-029 - “Short Position Reports – Canadian Trading and Quotation
System Inc.” (November 8, 2004) pertained to the reporting of short positions for securities listed for
trading on the Canadian Trading and Quotation System Inc. (“CNQ”). This Notice was repealed andreplaced effective November 1, 2007 by Market Integrity Notice 2007-022 – “Guidance - Short Position
Calculation and Reporting” (October 29, 2007).

Repealed Guidance:

Market Integrity Notice 2004-032 - “Submission of Short Position Reports to Canadian Trading andQuotation System Inc.” (December 14, 2004) pertained to the reporting of short positions in CNQ
securities. This Notice was repealed and replaced effective November 1, 2007 by Market Integrity Notice
2007-022 – “Guidance – Short Position Calculation and Reporting” (October 29, 2007).

Repealed Guidance:

See Market Integrity Notice 2007-022 - “Guidance - Short Position Calculation and Reporting”(October 29, 2007), effective November 1, 2007, which provides guidance on the procedures for filing
Short Position Reports electronically with the Toronto Stock Exchange, TSX Venture Exchange, andCanadian Securities Exchange) as a result of the discontinuance of REGNET and the introduction of
EchoworxTM Encrypted Message eXchange or EMXTM for secure electronic regulatory communications.
This Notice was repealed and replaced effective November 30, 2018 by IIROC Notices 17-0241 –“Guidance on Short Position Calculation and Reporting” (December 15, 2017) and 18-0062 – “Short
Position Calculation and Reporting” (March 22, 2018).

Guidance:

See IIROC Notices 17-0241 – “Guidance on Short Position Calculation and Reporting” (December 15,

Part 10 - Compliance
November 1, 2007

UMIR 10.10-1

2017).
Guidance:

Part 10 - Compliance
November 1, 2007

See IIROC Notice 18-0062 – “Short Position Calculation and Reporting” (March 22, 2018).

UMIR 10.10-2

Universal Market Integrity Rules

Rules & Policies

10.11 Audit Trail Requirements(1)

Order and Trade Record - In addition to any information required to be recorded
by a Participant in accordance with Part 11 of the Trading Rules, a Participant
shall:
(a)

(b)

(c)

(2)

immediately following the receipt or origination of an order, record:(i)all order designations required by clause (b) of subsection (1) of Rule
6.2,

(ii)

the identifier of any investment adviser or registered representative
receiving the order, and(iii)

any information respecting the special terms attaching to the order
required by subsection (2) of Rule 6.2, if applicable;

immediately following the entry of an order to trade on a marketplace, add tothe record:(i)

the identifier of the Participant through which any trade would becleared and settled,(ii)

the identifier assigned to the marketplace on which the order is entered;andimmediately following the variation or correction of an order, add to the record
any information required by clause (a) which has been changed.

Transmittal of Order Information to a Market Regulator - The Participant shalltransmit the record of the order required to be maintained by the Participant by thissection to:(a)the Market Regulator for the marketplace on which the trade was executed;
or(b)

if the order was not executed on a marketplace in accordance with Rule 6.4,
(i)a Market Regulator if the security is not listed on an Exchange or tradedon a QTRS, and(ii)

the Market Regulator for the Exchange or the QTRS on which thesecurity is listed or quoted,

at the time and in such manner and form as may be required by the Market
Regulator.
(3)

Provision of Additional Information – In addition to any information provided bya Participant to a Market Regulator in accordance with subsection (2), theParticipant shall provide to the Market Regulator forthwith upon request in suchform and manner as may be reasonably required by the Market Regulator:

Part 10 - Compliance
December 14, 2022

UMIR 10.11-1

(4)

(a)

any additional information respecting the order or trade reasonably
requested; and(b)information respecting any prior or subsequent order or trade in the security
or the derivative or a related security or a related derivative undertaken by theParticipant on any marketplace.

Provision of Information by a Access Person – Where an order has beenentered on a marketplace by an Access Person, the Access Person shall provide
to the Market Regulator of the marketplace on which the order was entered or theMarket Regulator of the marketplace on which the order was executed forthwith
upon request in such form and manner as may be reasonably required by theMarket Regulator:(a)any information respecting the order or trade reasonably requested; and(b)information respecting any prior or subsequent order or trade in the security
or a related security undertaken by the Access Person on any marketplace.

Defined Terms:

NI 21-101 section 1.1 – “order”
NI 21-101 section 1.4 – Interpretation -- “security”
UMIR section 1.1 – “Access Person”, “derivative”, “Exchange”, “listed security”, “Market Regulator”,“marketplace”, “Participant”, “QTRS”, “quoted security”, “related derivative”, “related security” and“Trading Rules”
UMIR section 1.2(2) – “trade”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to Rule 10.11(4) to refer to “an” Access Person rather than “a”.
See Footnote 1 in Status of Amendments.
Effective December 14, 2022, the applicable securities commissions approved amendments to UMIR
10.11. See IIROC Notice 22-0140– “Amendments Respecting the Trading of Derivatives on aMarketplace” (September 15, 2022).

Guidance:

Market Integrity Notice 2003-006 - “Electronic Audit Trails” (March 28, 2003) was a joint notice of theStaff of the Canadian Securities Administrators, Market Regulation Services Inc., the Bourse deMontréal, and the Investment Dealers Association.

Repealed Guidance:

Market Integrity Notice 2005-031 - “Guidance – Disclosure of Marketplaces on Trade Tickets andConfirmations” (September 16, 2005) provided guidance relating to the proper identification on a trade
ticket and confirmation of the marketplace on which the order is entered and the trade is executed. This
Notice was repealed and replaced by IIROC Notice 12-0236 - “Guidance on Marketplace Disclosure
for Trade Confirmations” (July 27, 2012).

Guidance:

IIROC Notice 12-0236 - “Guidance on Marketplace Disclosure for Trade Confirmations” (July 27,2012) provides guidance related to marketplace disclosure on trade confirmations.

General Commentary:

Joint CSA/SRO Notice 23-304 – Status of the Transaction Reporting and Electronic Audit Trail System(TREATS) was issued on March 17, 2006 and pertains to an electronic audit initiative to investigate,
design and implement a solution to facilitate compliance with Canadian securities audit trail
requirements introduced in National Instrument 23-101 Trading Rules.

General Commentary:

Joint CSA/SRO Notice 23-305 – Status of the Transaction Reporting and Electronic Audit Trail System(TREATS) was issued on October 20, 2006to update Joint CSA/SRO Notice 23-304 – Status of theTransaction Reporting and Electronic Audit Trail System (TREATS).

Disciplinary Proceedings:

In the Matter of Research Capital Corporation (“Research”) (June 24, 2002) OOS 2002-001
Facts – In September 1998, Research identified a problem with one of its traders not properly
completing trade tickets. Research sent a memorandum to the trader reminding him of the need toensure that complete records are maintained. Although Research was aware that the trader was notproperly completing trade tickets, Research allowed the conduct to continue in the period November
23, 1998 – March 4, 1999.
Disposition – Between November 23, 1998 and March 4, 1999, Research failed to keep proper

Part 10 - Compliance
December 14, 2022

UMIR 10.11-2

records.
Requirements Considered – TSX General By-law 16.03. Comparable UMIR Provision – Rule 10.11
Sanction - $15,000 fine and costs of $2,500
Disciplinary Proceedings:

Rule 10.11(3) was considered In the Matter of UBS Securities Canada Inc. (“UBS Canada”)(October 8, 2004) SA 2004-006. See Disciplinary Proceedings under Rule 2.2.

Disciplinary Proceedings:

Rule 10.11(1) was considered In the Matter of Credit Suisse First Boston Canada Inc. (“CSFB”)(December 3, 2004) SA 2004-007. See Disciplinary Proceedings under Rule 6.4.

Disciplinary Proceedings:

Rule 10.11(1) was considered In the Matter of Salman Partners Inc. (“Salman”), Sameh Magid(“Magid”), William Burk (“Burk”) and Ian Todd (“Todd”) (February 18, 2005) SA 2005-001.
See Disciplinary Proceedings under Rule 3.1.

Disciplinary Proceedings:

Rule 10.11 was considered In the Matter of Desjardins Securities Inc. (“Desjardins”), JeanPierre De Montigny (De Montigny”) and Jean-Luc Brunet (“Brunet”) (March 16, 2005) SA
2005-002. See Disciplinary Proceedings under 5.3.

Disciplinary Proceedings:

Rule 10.11(1) was considered In the Matter of Zoltan Horcsok (“Horcsok”) (July 18, 2005) SA
2005-003. See Disciplinary Proceedings under 7.1.

Disciplinary Proceedings:

Rule 10.11(1) was considered In the Matter of Glen Grossmith (“Grossmith”) (July 18, 2005) SA
2005-004. See Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

Rule 10.11 was considered In the Matter of Union Securities Ltd. (“Union”) (April 18, 2006) DN
2006-004. See Disciplinary Proceedings under Rule 6.2.

Disciplinary Proceedings:

Rule 10.11(1) was considered In the Matter of Raymond James Ltd. (“Raymond James”) andMarc Deslongchamps (“Deslongchamps”) (June 30, 2006) DN 2006-006. See Disciplinary
Proceedings under Rule 5.3.

Disciplinary Proceedings:

Rule 10.11(1) was considered In the Matter of TD Securities Inc. (“TDSI”) (July 5, 2006) DN
2006-007. See Disciplinary Proceedings under Rule 5.1.

Disciplinary Proceedings:

Rule 10.11(1) was considered In the Matter of Golden Capital Securities Ltd. (“Golden”), Jack
Finkelstein (“Finkelstein”) and Jeff Rutledge (“Rutledge”) (November 23, 2007)) DN 2007-004.
See Disciplinary Proceedings under Rule 6.2.

Disciplinary Proceedings:

Rule 10.11(1) was considered In the Matter of National Bank Financial (“NBF”), Paul Clarke(“Clarke”) and Todd O’Reilly (“O’Reilly”) (January 21, 2011) DN 11-0029 and DN 11-0030. See
Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

Rule 10.11was considered In the Matter of M Partners Inc. (“M Partners”) (February 27, 2015)
DN 15-0054. See Disciplinary Proceedings under Rule 7.1.

Disciplinary Proceedings:

Rule 10.11 was considered In the Matter of M Partners Inc. (“M Partners”) and Steven Isenberg(“Isenberg”) (July 12, 2018) DN 18-0133. See Disciplinary Proceedings under Rule 7.1.

Part 10 - Compliance
December 14, 2022

UMIR 10.11-3

Universal Market Integrity Rules

Rules & Policies

10.12 Retention of Records and Instructions(1)

A Participant shall retain:(a)the record of each order as required by Rule 10.11; and(b)sufficient information to identify the beneficial owner of each account for
which a record of an order is retained,

for a period of not less than seven years from the creation of the record of theorder, and for the first two years, such record and information shall be kept in areadily accessible location.
(2)

An Access Person shall keep information respecting an order on the marketplace:(a)of which the Access Person is a subscriber; or(b)on which the order of the Access Person was executed,

during the period of not less than seven years from the date of the origination of
the order, and for the first two years, such information shall be kept in a readily
accessible location.
Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
NI 21-101 section 1.1 – “order”, ”member”, “subscriber” and “user”
UMIR section 1.1 – “Access Person”, “Market Regulator”, “marketplace”, and “Participant”

Regulatory History:

Effective September 1, 2016, the applicable securities commissions approved amendments to repeal
those portions of Rule 10.12 of UMIR that relate to the requirement to permit inspection of records by
IIROC as this obligation will be included in the consolidated enforcement investigations and complianceexaminations rules. See IIROC Notice 16-0122 – “Implementation of the consolidated IIROC
Enforcement, Examination and Approval Rules” (June 9, 2016).

Guidance:

Market Integrity Notice 2002-005 - “Evidence of Beneficial Ownership of Accounts” (April 10, 2002)
pertains to the interpretation of Rule 10.12(1)(b).

Disciplinary Proceedings:

Rule 10.12(1) was considered In the Matter of Zoltan Horcsok (“Horcsok”) (July 18, 2005) SA
2005-003. See Disciplinary Proceedings under 7.1.

Disciplinary Proceedings:

Rule 10.12(1) was considered In the Matter of TD Securities Inc. (“TDSI”) (July 5, 2006) DN
2006-007. See Disciplinary Proceedings under Rule 5.1.

Part 10 - Compliance
September 1, 2016

UMIR 10.12-1

Universal Market Integrity Rules

Rules & Policies

10.13 Exchange and Provision of Information by Market Regulators
Each Market Regulator shall provide information and other forms of assistance formarket surveillance, investigative, enforcement and other regulatory purposes including
the administration and enforcement of UMIR to:(a)a self-regulatory entity;(b)a self-regulatory organization in a foreign jurisdiction;(c)a securities regulatory authority;(d)a securities regulatory authority in a foreign jurisdiction; and(e)another Market Regulator.

Defined Terms:

NI 14-101 section 1.1(3) – “foreign jurisdiction”
NI 21-101 section 1.1 – “self-regulatory entity”
UMIR section 1.1 – “Market Regulator” and “UMIR”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to section 10.13 that came into force on June 1, 2008 to replace
the phrase “these Rules” with “UMIR”. See Footnote 1 in Status of Amendments.

Part 10 - Compliance

UMIR 10.13-1

June 1, 2008

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10.14 Synchronization of Clocks
Each marketplace and each Participant shall synchronize the clocks used for recording thetime and date of any event that must be recorded pursuant to UMIR to the clock used by
the Market Regulator for this purpose.
Defined Terms:

UMIR section 1.1 – “Market Regulator”, “marketplace”, “Participant” and “UMIR”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities commissions
approved an amendment to section 10.14 that came into force on June 1, 2008 to replace the phrase “theseRules” with “UMIR”. See Footnote 1 in Status of Amendments.

Repealed Guidance:

See Market Integrity Notice 2002-007 – Guidance - “Time Synchronization” (May 6, 2002). This Notice wasrepealed and replaced by Market Integrity Notice 2008-007 – “Guidance – Time Synchronization” (April
11, 2008). This Notice was repealed and replaced by IIROC Notice 16-0022 – “Guidance on Time
Synchronization” (February 4, 2016).

Guidance:

See Market Integrity Notice 16-0022 – “Guidance on Time Synchronization” (February 4, 2016).

Part 10 - Compliance
September 1, 2016

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Rules & Policies

10.15 Assignment of Identifiers and Symbols(1) The Market Regulator shall assign a unique identifier to:(a)a marketplace for trading purposes upon the Market Regulator being retained
as the regulation services provider for the marketplace.

(2) A marketplace, upon granting access to the trading system of the marketplace to a
Participant or Access Person, shall assign a unique identifier to the Participant orAccess Person for trading purposes.
(3)

An Exchange upon listing of a security or a derivative, a QTRS upon quoting of asecurity and a marketplace upon commencement of trading of a foreign exchangetraded security shall assign a unique symbol for trading purposes.

(4) The Market Regulator in assigning an identifier pursuant to subsection (1) or an
Exchange, QTRS or marketplace in assigning an identifier or symbol pursuant tosubsection (2) or (3) shall not assign an identifier or symbol that is:(a) different from the identifier or symbol previously assigned to the marketplace,
Participant, security or derivative if such previously assigned identifier or
symbol will continue to be used in respect of that marketplace, Participant,security or derivative;(b) the same as an identifier or symbol assigned to another marketplace,
Participant, security or derivative if such previously assigned identifier or
symbol will continue to be used in respect of that other marketplace,
Participant, security, or derivative;(c)

not in compliance with the provisions of any agreement made in accordancewith section 7.5 of the Trading Rules for the co-ordination and monitoring andenforcement between each regulation services provider, Exchange and QTRS;or(d) in a form or of a type that is not generally supported by the systems of market
participants as defined for the purposes of applicable securities legislation.
Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
NI 21-101 section 1.1 – “foreign exchange-traded security” and “regulation services provider”
NI 21-101 section 1.4 – Interpretation -- “security”
NI 31-103 section 1.1 – “investment dealer”
UMIR section 1.1 – “Access Person”, “derivative”, “direct electronic access”, “Exchange”, “foreign dealer
equivalent”, “Market Regulator”, “marketplace”, “Participant”, “QTRS”, “routing arrangement” and“Trading Rules”

Regulatory History:

Part 10 - Compliance
December 14, 2022

Effective June 26, 2009, the applicable securities commissions made an amendment to Rule 10.15.
Specifically, the provision below was repealed and replaced:(1)

Each Participant and marketplace shall be assigned a unique identifier for trading purposes.

(2)

Unless otherwise provided pursuant to an agreement made in accordance with section 7.5 of
the Trading Rules, the Toronto Stock Exchange shall assign each identifier for the purposesof subsection (1) after consultation with each Exchange and QTRS.
UMIR 10.15-1

(3)Each security that trades on a marketplace shall be assigned a unique symbol for trading
purposes.

(4)

Unless otherwise provided pursuant to an agreement made in accordance with section 7.5 of
the Trading Rules, the Toronto Stock Exchange shall assign each symbol for the purposes ofsubsection (3) after consultation with each Exchange and QTRS.

See IIROC Notice 09-0191 - “Provisions Respecting the Assignment of Identifiers and Symbols”(June 26, 2009).
On July 4, 2013 the applicable securities commissions approved, effective March 1, 2014, amendments
to subsections (1) and (2) to require identifiers for parties that access marketplaces using forms of thirdparty electronic access. See IIROC Notice 13-0184 – “Provisions Respecting Third-Party Electronic
Access to Marketplaces” (July 4, 2013).
Effective July 26, 2021, the applicable securities commissions approved amendments to sections 1.1,
6.2, 7.13 and 10.15 to add identifier and/or designation requirements for clients on orders sent to amarketplace. See IIROC Notice 19-0071 – “Amendments Respecting Client Identifiers” (April 18,2019).
Effective December 14, 2022, the applicable securities commissions approved amendments to UMIR
10.15. See IIROC Notice 22-0140– “Amendments Respecting the Trading of Derivatives on aMarketplace” (September 15, 2022).
Guidance:

Part 10 - Compliance
December 14, 2022

See IIROC Notice 13-0185 – “Guidance Respecting Third-Party Electronic Access toMarketplaces” (July 4, 2013).

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10.16 Gatekeeper Obligations of Directors, Officers and Employees ofParticipants and Access Persons
(1)

(2)

An officer, director, partner or employee of a Participant shall forthwith report totheir supervisor or the compliance department of the Participant upon becoming
aware of activity in a principal account, non-client account or client account of theParticipant or a related entity that the officer, director, partner or employee believes
may be a violation of:(a)Subsection (1) of Rule 2.1 respecting specific unacceptable activities;(b)

Rule 2.2 respecting manipulative and deceptive activities;(c)

Rule 2.3 respecting improper orders and trades;(d)Rule 4.1 respecting frontrunning;(e)Part C of Corporation Rule 3100 – Best Execution of Client Orders respecting
best execution of client orders;(f)Rule 5.3 respecting client priority;(g)Rule 6.4 respecting trades to be on a marketplace; and(h)

Any Requirement that has been designated by the Market Regulatory for the
purposes of this subsection.

An officer, director, partner or employee of an Access Person shall forthwith reportto their supervisor or the compliance department of the Access Person upon
becoming aware of activity by the Access Person or a related entity that the officer,
director, partner or employee believes may be a violation of:(a)Subsection (2) of Rule 2.1 respecting specific unacceptable activities;(b)

Rule 2.2 respecting manipulative and deceptive activities;(c)

Rules 2.3 respecting improper orders or trades; and(d)any Requirement that has been designated by the Market Regulator for the
purposes of this subsection.

(3)

If a supervisor or compliance department of a Participant or Access Person
receives a report pursuant to subsection (1) or (2), the supervisor or compliancedepartment shall diligently conduct a review in accordance with the policies andprocedures of the Participant adopted in accordance with Rule 7.1 or inaccordance with the ordinary practices of the Access Person.

(4)

If the review conducted by the supervisor or compliance department concluded that
there may be a violation, the supervisor or compliance department shall:(a)Part 10 - Compliance
July 27, 2023

make a written record of the report by the officer, director, partner or
employee and the review conducted in accordance with subsection (3);

UMIR 10.16-1

(5)

(6)

(b)

diligently investigate the activity that is the subject of the report and review;(c)make a written record of the findings of the investigation; and(d)report the findings of the investigation to the Market Regulator if the finding of
the investigation is that a violation of an applicable provision of UMIR has
occurred and such report shall be made not later than the 15th day of themonth following the month in which the findings are made.

Each Participant and Access Person shall with respect to the records of the report,
the review and the findings required by subsection (4):(a)

retain the records for a period of not less than seven years from the creationof the record; and(b)allow the Market Regulator to inspect and make copies of the records at any
time during ordinary business hours during the period that such record isrequired to be retained in accordance with clause (a).

The obligation of a Participant or an Access Person to report findings of aninvestigation under subsection (4) is in addition to any reporting obligation that may
exist in accordance with applicable securities legislation, the requirements of any
self-regulatory entity and any applicable Marketplace Rules.

POLICY 10.16 – GATEKEEPER OBLIGATIONS OF DIRECTORS, OFFICERS ANDEMPLOYEES OF PARTICIPANTS AND ACCESS PERSONSPart 1 – The Gatekeeper Obligation
Rule 10.16 requires a Participant or Access Person to conduct further investigation or review
where the Participant or Access Person has reason to believe that there may have been aviolation of one of the provisions enumerated in Rule 10.16. A Participant or Access Person
cannot ignore “red flags” which may be indicative of improper behaviour by a client, director,
officer, partner or employee of the Participant, Access Person or related entity.
Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation”
NI 21-101 section 1.1 – “order” and “self-regulatory entity”
UMIR section 1.1 – “Access Person”, “client order”, “employee”, “Market Regulator”, “marketplace”,“Marketplace Rules”, “Participant”, “principal account”, “related entity”, “Requirements” and “UMIR”
UMIR section 1.2(2) – “trade”

Regulatory History:

Effective April 1, 2005, the applicable securities commissions approved an amendment to add Rule10.16 and Part 1 of Policy 10.16. See Market Integrity Notice 2005-011 – “Notice of Amendment
Approval - Provisions Respecting Manipulative and Deceptive Activities” (April 1, 2005).
Effective February 1, 2011, the applicable securities commissions approved an amendment to delete
clause (f) of subsection (1) of Rule 10.16 as a result of the repeal of Rule 5.2 and to renumber theremaining clauses accordingly. See Notice 11-0036 - “Provisions Respecting the Implementation of
the Order Protection Rule” (January 28, 2011).
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See Notice 13-0294 “Amendments to the French version of UMIR”(December 9, 2013).
Effective September 1, 2016, the applicable securities commissions approved amendments to makeeditorial changes to Rule 10.16. See IIROC Notice 16-0122 – “Implementation of the consolidated
IIROC Enforcement, Examination and Approval Rules” (June 9, 2016).

Part 10 - Compliance
July 27, 2023

UMIR 10.16-2

Effective January 2, 2018, the applicable securities commissions approved amendments to update therule reference to the best execution obligation in Rule 10.16. See IIROC Notice 17-0137 “Amendments Respecting Best Execution” (July 6, 2017).
Effective December 31, 2021, the applicable securities commissions approved housekeeping
amendments to replace rule references to the Dealer Member Rules with provisions of the IIROC Rules.
See IIROC Notice 20-0042 - Rules Notice – Notice of Approval – UMIR - Housekeeping amendments
to UMIR Following Implementation of IIROC Rules (March 5, 2020).
Effective July 27, 2023, the applicable securities commissions approved housekeeping amendments to
UMIR to correct inaccurate referencing and typographical mistakes and to ensure consistency between
the English and French versions of UMIR. See CIRO Bulletin 23-0107 - "Housekeeping Amendments
to UMIR" (July 27, 2023).
Guidance:

See Market Integrity Notice 2006-007 - “Guidance – Gatekeeper Reporting Obligation” (February 24,2006). The procedure for filing a Gatekeeper Report was updated as of June 1, 2008, see Market
Integrity Notice 2008-011 – “New Procedures for Gatekeeper Reports” (May 16, 2008).

Guidance:

See Market Integrity Notice 2007-012 - “Guidance – Feedback on Gatekeeper Reports” (April 27,2007). The procedure for filing a Gatekeeper Report was updated as of June 1, 2008, see Market
Integrity Notice 2008-011 –“New Procedures for Gatekeeper Reports” (May 16, 2008).

Guidance:

See Market Integrity Notice 2008-011 - “Guidance – New Procedures for Gatekeeper Reports” (May16, 2008).

Disciplinary Proceedings:

Rule 10.16 was considered In the Matter of Dominick & Dominick Securities Inc. (“Dominick”)(December 19, 2002) OOS 2002-009. See Disciplinary Proceedings under Rule 7.1.

Disciplinary Proceedings:

Rule 10.16 was considered In the Matter of Luke Roger Beresford Smith (“Smith”) (October 24,2002) OOS 2002-011. See Disciplinary Proceedings: under Rule 2.1

Disciplinary Proceedings:

Rule 10.16 was considered In the Matter of Douglas Francis Corrigan (“Corrigan”) (May 28,2003) OOS 2003-002. See Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

Rule 10.16 was considered In the Matter of Tony D’Ugo (“D’Ugo”) (April 6, 2010) DN 10-0093.
See Disciplinary Proceedings under Rule 2.1.

Disciplinary Proceedings:

Rule 10.16 was considered In the Matter of Francesco Mauro (“Mauro”) and Scott Fraser
Harding (“Harding”) (May 25, 2010) DN 10-0149. See Disciplinary Proceedings under Rule 2.2.

Part 10 - Compliance
July 27, 2023

UMIR 10.16-3

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10.17 Gatekeeper Obligations with Respect to Electronic Trading(1)

A Participant that has, under Rule 7.1, authorized an investment dealer to perform
on its behalf the setting or adjusting of a specific risk management or supervisory
control, policy or procedure or the provision of risk management or supervisory
controls, policies and procedures to a third party shall forthwith report to the Market
Regulator the fact that:(a)the written agreement with the investment dealer or third party has been
terminated; or(b)

the Participant knows or has reason to believe that the investment dealer or
third party has failed to promptly remedy any deficiency identified by theParticipant.

Defined Terms:

UMIR section 1.1 – “Market Regulator” and “Participant”.

Related Provisions:

UMIR sections 7.1(7) – (10) and UMIR Policy 7.1 Part 7.

Regulatory History:

On December 7, 2012, the applicable securities commissions approved an amendment, effective
March 1, 2013, to add section 10.17. See IIROC Rules Notice 12-0363 – “Provisions Respecting
Electronic Trading” (December 7, 2012).

Part 10 - Compliance

UMIR 10.17-1

March 1, 2013

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10.18 Gatekeeper Obligations with Respect to Access to Marketplaces
(1)

(2)

A marketplace that has provided access to a Participant or Access Person shallforthwith report to the Market Regulator the fact that the marketplace:(a)

has terminated the access of the Participant or Access Person to themarketplace; or(b)knows or has reason to believe that the Participant or Access Person has or
may have breached a material provision of any Marketplace Rule oragreement pursuant to which the Participant or Access Person was granted
access to the marketplace.

A Participant that has provided access to a marketplace pursuant to directelectronic access or through a routing arrangement shall forthwith report to theMarket Regulator the fact that the Participant:(a)

has terminated the access of the client under the arrangement for directelectronic access or of the investment dealer or foreign dealer equivalentthrough a routing arrangement; or(b)knows or has reason to believe that the client, investment dealer or foreigndealer equivalent has or may have breached a material provision of:Defined Terms:(i)any standard established by the Participant for the granting of directelectronic access or a routing arrangement, or(ii)

the written agreement between the Participant and the client regarding
the direct electronic access, or the investment dealer or foreign dealer
equivalent regarding a routing arrangement.

NI 31-103 section 1.1 – “investment dealer”
UMIR section 1.1 – “Access Person”, “direct electronic access”, “foreign dealer equivalent”, “Market
Regulator”, “marketplace”, “Marketplace Rule”, “Participant” and “routing arrangement”

Related Provisions:

UMIR section 7.13

Regulatory History:

On July 4, 2013 the applicable securities commissions approved an amendment, effective March 1, 2014
to add Rule 10.18. See IIROC Notice 13-0184 – “Provisions Respecting Third-Party Electronic
Access to Marketplaces” (July 4, 2013).

Part 10 - Compliance

UMIR 10.18-1

March 1, 2014

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Rules & Policies

10.19 Reporting limits for listed derivatives(1) Each Participant shall file with the Market Regulator a daily listed derivatives position
report of all positions required to be reported as established by an Exchange.
(2) Notwithstanding subsection (1), the Market Regulator may modify the reporting limits
established by an Exchange and prescribe the information and form that is required
to be reported if it believes that it is necessary to maintain fair and orderly market.
Defined Terms:

UMIR section 1.1 – “derivative”, “Exchange”, “listed derivative”, ”Market Regulator”, “Participant”

Regulatory History:

Effective December 14, 2022, the applicable securities commissions approved amendments to add
requirements for reporting limits for listed derivatives under UMIR 10.19 See IIROC Notice 22-0140 –“Amendments Respecting the Trading of Derivatives on a Marketplace” (September 15, 2022).

Part 10 - Compliance

UMIR 10.19-1

December 14, 2022

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Rules & Policies

PART 11 – ADMINISTRATION OF UMIR
11.1

General Exemptive Relief(1)

A Market Regulator may exempt a specific transaction from the application of aprovision of UMIR, if in the opinion of the Market Regulator, the provision of such
exemption:(a)would not be contrary to the provisions of any applicable securities legislationand the regulation and rules thereunder;(b)

would not be prejudicial to the public interest or to the maintenance of a fairand orderly market; and(c)is warranted after due consideration of the circumstances of the particularperson or transaction.

(2)

A Market Regulator may, upon approval by the applicable securities regulatory
authority, exempt a marketplace or a class of transactions from the application of aprovision of UMIR.

(3)The Market Regulator shall amend UMIR to reflect any exemption provided undersubsection (2).

Defined Terms:

NI 14-101 section 1.1(3) – “securities legislation” and “securities regulatory authority”
UMIR section 1.1 – “Market Regulator”, “marketplace” and “UMIR”
UMIR section 1.2(2) – “person”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved amendments to make editorial changes. See Footnote 1 in Status ofAmendments.
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 - “Rules Notice – Notice of Approval and
Implementation – Amendments to the French version of UMIR” (December 9, 2013).

Repealed Guidance:

Market Integrity Notice 2005-020 - “Guidance – Obtaining a Trading Exemption or Rule
Interpretation” (June 13, 2005) provided guidance on the procedures to obtain an exemption from or aformal rule interpretation of a provision of UMIR. This Notice was repealed by IIROC Notice 12-0029 –“Obtaining a Trading Exemption or Rule Interpretation” (January 27, 2012).

Repealed Guidance:

IIROC Notice 12-0029 - “Guidance – Obtaining a Trading Exemption or Rule Interpretation”(January 27, 2012) provided guidance on the procedures to obtain an exemption from or a formal ruleinterpretation of a provision of UMIR. This Notice was repealed by IIROC Notice 15-0191 – “Obtaininga Trading Exemption or Rule Interpretation” (August 28, 2015).

Technical Notice:

See IIROC Notice 15-0191 – “Obtaining a Trading Exemption or Rule Interpretation” (August 28,2015).

Part 11 – Administration of UMIR
December 9, 2013

UMIR 11.1-1

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Rules & Policies

11.2

General Prescriptive Power(1)

A Market Regulator may, from time to time, make or amend a provision of UMIR or
Policy.

(2)

A provision of UMIR or Policy or an amendment to a provision of UMIR or Policy
shall not become effective without the approval of the applicable securities
regulatory authority.

Defined Terms:

NI 14-101 section 1.1(3) – “securities regulatory authority”
UMIR section 1.1 – “Market Regulator”, “Policy” and “UMIR”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved amendments to Rule 11.2 that came into force on June 1, 2008 to replace theword “Rule” with “provision of UMIR”. See Footnote 1 of Status of Amendments.
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 - “Rules Notice – Notice of Approval and
Implementation – UMIR – Amendments to the French version of UMIR” (December 9, 2013).

Part 11 – Administration of UMIR
December 9, 2013

UMIR 11.2-1

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11.3

Review or Appeal of Market Regulator Decisions
Any person directly affected by any direction or decision of a Market Integrity Official or aMarket Regulator made in connection with the administration of UMIR shall request areview of the direction or decision by an executive officer of the Market Regulator prior toapplying to the applicable securities regulatory authority for a hearing and review orappeal.

Defined Terms:

NI 14-101 section 1.1(3) – “securities regulatory authority”
UMIR section 1.1 – “ “Market Integrity Official”, “Market Regulator” and “UMIR”
UMIR section 1.2(2) – “person”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved an amendment to repeal and replace Rule 11.3 that came into force on June 1,
2008. See Footnote 1 in Status of Amendments.

Part 11 – Administration of UMIR
June 1, 2008

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11.4

Method of Giving Notice(1)

Unless otherwise specifically provided in any Requirement, notice to any person
shall be sufficiently given if:(a)delivered personally to the person to whom it is to be given;(b)delivered or mailed by pre-paid ordinary mail to the last address of such
person as recorded by the Market Regulator or any securities regulatory
authority or recognized self-regulatory organization; or(c)provided by telephone transmission or any other form of transmitted orrecorded communication or in any other manner, including electronic means,
which may, in all the circumstances, could be reasonably expected to cometo the attention of such person.

(2)

The Market Regulator may change the address of any person on the records of theMarket Regulator in accordance with any information believed by the Market
Regulator to be reliable.

(3)

A notice delivered in accordance with this section shall be deemed to have been
given when the notice is delivered personally or at the address aforesaid; a noticeso mailed shall be deemed to have been given when deposited in a post office or
public letter box; and a notice sent by any means of wire or wireless or any otherform of transmitted or recorded communication shall be deemed to have been
given when delivered to the appropriate communication company or agency or its
representatives for dispatch.

Defined Terms:

NI 14-101 section 1.1(3) – “securities regulatory authority”
UMIR section 1.1 – “Market Regulator” and “Requirements”
UMIR section 1.2(2) – “person”

Regulatory History:

Effective December 9, 2013, the applicable securities commissions approved amendments to the French
version of UMIR. See Notice 13-0294 – Notice of Approval and Implementation – “Amendments to the
French version of UMIR” (December 9, 2013).

Part 11 – Administration of UMIR
December 9, 2013

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11.5

Computation of Time(1)

In computing the time when a notice must be given or for the doing of anything or
taking any proceeding under any provision of a Requirement requiring that a notice
be given a specified number of days prior to any meeting, hearing, action orproceeding or that any action be done or proceeding taken within a specified
number of days after some event, the date of giving of the notice or of such event
shall be excluded and the date of the meeting, hearing, doing of the act or taking of
the proceedings shall be included.

(2)

Where the time limited for a proceeding or the doing of anything under any
provision of a Requirement expires or falls upon a day that is not a trading day, thetime so limited extends to and the thing may be done on the next day following thatis a trading day.

Defined Terms:

UMIR section 1.1 – “Requirements” and “trading day”

Regulatory History:

Effective December 9, 2013, the applicable securities commissions approved amendments to the French
version of UMIR. See Notice 13-0294 – Notice of Approval and Implementation – “Amendments to the
French version of UMIR” (December 9, 2013).

Part 11 – Administration of UMIR
December 9, 2013

UMIR 11.5-1

Universal Market Integrity Rules

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11.6

Waiver of Notice
Any person may waive any notice that is required to be given to such person and such
waiver, whether given before or after the meeting, hearing or other event of which notice
is required to be given, shall cure any default in giving such notice.

Defined Terms:

UMIR section 1.2(2) – “person”

Part 11 – Administration of UMIR
April 1, 2005

UMIR 11.6-1

Universal Market Integrity Rules

Rules & Policies

11.7

Omissions or Errors in Giving Notice
The accidental omission to give any notice to any person or the failure of a person toreceive any notice or an error in any notice not affecting the substance of the noticedoes not invalidate any action founded or taken on the basis of such notice.

Defined Terms:

UMIR section 1.2(2) – “person”

Part 11 – Administration of UMIR
April 1, 2005

UMIR 11.7-1

Universal Market Integrity Rules

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11.8

Transitional Provisions - Repealed

Defined Terms:

N1 21-101 section 1.1 – “regulation services provider”
UMIR section 1.1 – “Market Regulator”, “marketplace”, “Marketplace Rules” and “Trading Rules”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities commissions
approved an amendment to repeal and replace Rule 11.8 that came into force on June 1, 2008. See Footnote
1 in Status of Amendments.
Effective December 9, 2013, the applicable securities commissions approved amendments to the French
version of UMIR. See IIROC Notice 13-0294 – Notice of Approval and Implementation – “Amendments to
the French Version of UMIR” (December 9, 2013).
Effective September 1, 2016, the applicable securities commissions approved an amendment to repeal Rule11.8 of UMIR. See IIROC Notice 16-0122 – “Implementation of the consolidated IIROC Enforcement,
Examination and Approval Rules” (June 9, 2016).

Part 11 - Administration of UMIR
September 1, 2016

UMIR 11.8-1

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11.9

Non-Application of UMIR
UMIR does not apply to:(a)any order entered and executed on a marketplace provided the order has beenentered and executed in compliance with the Marketplace Rules of thatmarketplace as adopted in accordance with Part 7 of the Trading Rules; and(b)

any order entered and executed on a marketplace or otherwise provided the orderhas been entered and executed in compliance with:(i)the rules of an applicable regulation services provider as adopted inaccordance with Part 8, 9 or 10 of the Trading Rules, or(ii)

the terms of an exemption from the application of Part 8, 9 or 10 of theTrading Rules.

Defined Terms:

NI 21-101 section 1.1 – “order” and “regulation services provider”
UMIR section 1.1 – “marketplace”, “Marketplace Rules”, “Trading Rules” and “UMIR”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved amendments Rule 11.9 that came into force on June 1, 2008 to replace theword “Rules” in the title with “UMIR” and to replace the phrase “These Rules do” with “UMIR does”. See
Footnote 1 in Status of Amendments.
Effective December 9, 2013, the applicable securities commissions approved amendments to the
French version of UMIR. See IIROC Notice 13-0294 – Notice of Approval and Implementation –“Amendments to the French version of UMIR” (December 9, 2013).

Part 11 - Administration of Rules
December 9, 2013

UMIR 11.9-1

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Rules & Policies

11.10 Indemnification and Limited Liability of the Market Regulator(1)

To the extent permitted by law, the Market Regulator shall be indemnified andsaved harmless by a Subject Person from and against all costs, charges andexpenses (including an amount paid to settle an action or satisfy a judgment andincluding legal and professional fees and out of pocket expenses of attending
trials, hearings and meetings), whatsoever that the Market Regulator sustains or
incurs in or about any action, suit or proceeding, whether civil, criminal oradministrative, and including any investigation, inquiry or hearing, or any appeal orreview, that is threatened, brought, commenced or prosecuted against a Protected
Party or in respect of which a Protected Party is compelled or requested toparticipate, for or in respect of any act, deed, matter or thing whatsoever made,done or permitted by the Subject Person.

(2)

To the extent permitted by law, all costs, charges and expenses in respect of which
the Market Regulator is indemnified pursuant to subsection (1) shall be paid to theMarket Regulator by the Subject Person within 90 days after receiving the written
request of the Market Regulator.

(3)

The Market Regulator shall not be liable to any Subject Person for any loss,
damage, cost, expense or other liability or claim arising from any:(a)failure of any system owned, operated or used by the Market Regulator; or(b)

act done in good faith in the exercise or intended exercise of any power or in
the performance or intended performance of any duty or for any neglect,default or omission in the exercise or performance in good faith of any such
power or duty by a Protected Party.

(4)

Subject to subsection (5), no Subject Person shall be entitled to commence or
carry on any action or proceeding in respect of any penalty or remedy imposed byan order or interim order or in respect of any act done or omitted under theprovisions of and in compliance with, or intended compliance with, UMIR and any
Policy as against a Protected Party.

(5)

Subsection (4) shall not restrict or limit the ability of any person to apply for areview in accordance with Rule 11.3 of a direction, order or decision of a Market
Regulator or Market Integrity Official.

Defined Terms:

UMIR section 1.1 –“hearing”, “Market Integrity Official”, “Market Regulator”, ”Policy”, “Protected
Party”, “Subject Person” and “UMIR”
UMIR section 1.2(2) – “person”

Related Provision:

UMIR section 11.3

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved amendments Rule 11.10 that came into force on June 1, 2008 to insert the word“for” after the phrase “Regulated Person” in subsection (3) and to replace the phrase “these Rules” insubsection (4) with “UMIR”. See Footnote 1 in Status of Amendments.

Part 11 – Administration of UMIR
September 1, 2016

UMIR 11.10-1

Effective September 1, 2016, the applicable securities commissions approved amendments to makeeditorial changes to Rule 11.10. See IIROC Notice 16-0122 – “Implementation of the consolidated
IIROC Enforcement, Examination and Approval Rules” (June 9, 2016).

Part 11 – Administration of UMIR
September 1, 2016

UMIR 11.10-2

Universal Market Integrity Rules

Rules & Policies

11.11 Status of UMIR and Policies
In the event of a conflict between a provision of UMIR or any Policy and the provision ofa Marketplace Rule or the functionality of the trading system of any marketplace, UMIR
shall govern unless otherwise provided by the securities regulatory authority.
Defined Terms:

NI 14-101 section 1.1(3) – “securities regulatory authority”
UMIR section 1.1 – “marketplace”, “Marketplace Rules”, “Policy” and “UMIR”

Regulatory History:

In connection with the recognition of IIROC and its adoption of UMIR, the applicable securities
commissions approved amendments Rule 11.11 that came into force on June 1, 2008 to replace theword “Rules” in the title with “UMIR” and to replace the phrase “these Rules do” with “UMIR”. See
Footnote 1 in Status of Amendments.

Part 11 - Administration of UMIR
June 1, 2008

UMIR 11.11-1

Universal Market Integrity Rules
STATUS OF AMENDMENTS
The following table lists the status of all of the amendments which have been proposed or made to a Rule or Policy of
the Universal Market Integrity Rules (“UMIR”) since the introduction of UMIR effective April 1, 2002.

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

1.1 – Definition of “Access
Person”

Rule

Expand the definition of “Access Person” to include persons who are
given “direct” access to an exchange or QTRS through a systems interconnection thereby making them subject to the same rules as a
subscriber to an ATS.

Withdrawn

2003-014 – June 27/03

2005-005 – Mar. 4/05

1.1 – Definition of “Access
Person”

Rule

Expand the definition of “Access Person” to include a person who has“Dealer-Sponsored Access” to a marketplace.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

1.1–
Definitionof“Acceptable Foreign Trade
Reporting Facility”

Rule

Introduce a new definition of “acceptable foreign trade reporting
facility”.

Approved

16-0082 – Apr 21/16

18-0154 – Aug. 9/18

Nov. 7/18

1.1–
Definitionof“Acceptable Foreign Trade
Reporting Facility”

Rule

Replace reference to “IIROC” with “the Corporation” following theamalgamation of IIROC and the MFDA into New SRO.

Approved

25-304- May 1/22

25-307 – Nov. 24/22

Jan. 1/23

1.1 – Definition of “applicable
marketdisplay”/“consolidated
marketdisplay”

Rule

Revise the definition of “consolidated market display” to reflect changes
in National Instrument 23-101 to eliminate the concept of principal
market and provide that information vendors must meet the standards
established by a regulation services provider.

Withdrawn

2005-018 – June 10/05

2006-021 – Oct. 31/06

1.1 – Definition of “arbitrage
account”

Rule

Amend the definition of “arbitrage account” to include derivatives.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “Basis
Order”

Rule

Provide a definition of a “Basis Order” that specifically recognizes“Basis Trades” as introduced by the TSX in a manner which would beapplicable to all marketplaces.

Approved

2004-030 – Nov. 26/04

2005-010 – Apr. 8/05

Apr. 8/05

1.1 – Definition of “Basis
Order”

Rule

Broaden the definition to specifically include Exempt Exchange-Traded
Funds

Approved

14-0077 – Mar. 27/14

15-0098 – April 30/15

Apr. 30/15

1.1 – Definition of “Basis
Order”

Rule

Amend the definition of “Basis Order” to replace references to a“derivative instrument” with a “listed derivative”

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

1

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

1.1 – Definition of “basket
trade”

Rule

Provide a definition of a “basket trade” that would be exempt from therestrictions and prohibitions regarding market stabilization and market
balancing.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

1.1 – Definition of “best ask
price”

Rule

Amend the definition of “best ask price” to clarify that “specialty” typeorders are excluded from the determination.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

1.1 – Definition of “best ask
price”

Rule

Amend the definition of “best ask price” to clarify that “specialty” typeorders are excluded from the determination.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

1.1 – Definition of “best ask
price”

Rule

Amend the definition of “best ask price” to restrict the determination toorders on protected marketplaces.

Withdrawn

14-0124 – May 15/14

1.1 – Definition of “best ask
price”

Rule

Amend the definition of “Best ask price” to restrict the determination toorders on protected marketplaces.

Approved

15-0129 – June 12/15

15-0211 – Sept 18/15

Sept. 18/15

1.1 – Definition of “best ask
price”

Rule

Extend the definition of “best ask price” to include the lowest price ofan order as displayed on an exchange to sell a listed derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “best bid
price”

Rule

Amend the definition of “best bid price” to clarify that “specialty” typeorders are excluded from the determination.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

1.1 – Definition of “best bid
price”

Rule

Amend the definition of “best bid price” to clarify that “specialty” typeorders are excluded from the determination.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

1.1 – Definition of “best bid
price”

Rule

Amend the definition of “best ask price” to restrict the determination toorders on protected marketplaces.

Withdrawn

14-0124 – May 15/14

1.1 – Definition of “best bid
price”

Rule

Amend the definition of “best bid price” to restrict the determination ororders on protected marketplaces.

Approved

15-0129 – June 12/15

15-0211 – Sept 18/15

Sept 18/15

1.1 – Definition of “best bid
price”

Rule

Amend the definition of “best bid price” to include the highest price ofan order as displayed on an exchange to buy a listed derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “bestindependent bid price”

Rule

Provide definition of the “best independent bid price” for the purposesof price restrictions on certain orders entered by a dealer-restrictedperson.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

1.1 – Definition of “better
price”

Rule

Replacing the definition of a “better price” for the purposes of theprovisions respecting "Dark Orders” and to clarify the application ofRule 6.3 and Rule 8.1.

Approved

11-0225 – Jul. 29/11

12-0130 – Apr. 13/12
12-0158 – May 8/12

Oct. 15/12

1.1 – Definition of “bundled
order”

Rule

Introduce a definition of “bundled order”

Approved

16-0123 – June 9/16

17-0039 – Feb 16/17

Sept 14/17

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

May 9/05

2

Rule/
PolicyUMIR Reference

Rules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal
21-0009 – Jan 14/21

EffectiveDate

1.1 – Definition of “bundled
order”Rule

To change non-client order to Dealer Person Related order

Withdrawn

19-0157 – Sept 5/19

1.1 – Definition of “bypass
order”

Rule

Amend the definition of “bypass order” to take into account unprotectedtransparent marketplaces.

Withdrawn

14-0124 – May 15/14

1.1 – Definition of “bypass
order”

Rule

Amend the definition of “bypass order” to take into account unprotectedtransparent marketplaces.

Approved

15-0129 – June 12/15

15/0211 – Sept 18/15

Sept 18/15

1.1 – Definition of “bypass
order”

Rule

Amend the definition of “bypass order” to limit the definition to a listed
security.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “Canadianaccount”

Rule

Provide definition of “Canadian account” to be used in connection with
the interpretation of rules governing the ability to undertake an “offmarketplace” trade.

Approved

2004-018 – Aug. 20/04
2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

1.1 – Definition of “client
order”

Rule

Provide definition of client order” to exclude a Dealer Related Person
order

Withdrawn

19-0157 – Sept 5, 201921-0009 – Jan 14/21

1.1 – Definition of “client
order”

Rule

Amend the definition of “client order” to include an order for thepurchase or sale of a derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “Closing
Price Order”

Rule

Provide a definition of a “Closing Price Order” that allows trades at thelast sale price of the security in regular trading on that marketplace.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

1.1–
Definition“connected security”

of

Rule

Provide a definition of a security which is “connected” to that security
being offered in a distribution, amalgamation, take-over bid, issuer bid,arrangement or other similar transaction.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.1–
Definition“connected security”

of

Rule

Editorial correction to clarify that satisfaction of any condition in thedefinition brings a security within the definition.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

1.1–
Definition“connected security”

ofPolicyProvide as part of the definition of “connected security” that, absent
other mitigating factors, a security significantly determines the value ofthe offered security if it accounts for more than 25% of the value.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.1–
Definitionof“consolidated
marketdisplay”

Rule

Revise the definition of “consolidated market display” to reflect changes
in National Instrument 23-101 to eliminate the concept of principal
market and provide that information must be provided to an information
vendor in accordance with National Instrument 21-101.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

1.1 – Definition of “Dark
Order”

Rule

Provide a definition of a ”Dark Order” for the purposes of the UMIR
provisions regarding the size of ”Dark Orders”, priority of execution andprice improvement requirements.

Approved

11-0225 – Jul. 29/11

12-0130 – Apr. 13/12
12-0158 – May 8/12

Oct. 15/12

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

3

Rule/
PolicyUMIR Reference

Rules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

1.1 – Definition of “Dealer
Related Person account”

Rule

To replace the definition of “non-client order”

Withdrawn

19-0157 – Sept 5/19

21-0009 – Jan 14/21

1.1 – Definition of “Dealer
Related Person order”

Rule

Introduce a definition of “dealer Related Person order” to mean anorder for a Dealer Related Person accountWithdrawn

19-0157 – Sept 5/19

21-0009 – Jan 14/21

1.1 – Definition of “dealerrestricted person”

Rule

Provide a definition of a “dealer-restricted person” that would be subject
to the restrictions and prohibitions regarding market stabilization andmarket balancing.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.1 – Definition of “dealerrestricted person”

Rule

Amend the definition of “dealer-restricted person” to clarify the level ofinvolvement required when participating in a restricted private
placement.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

1.1 – Definition of “dealerrestricted person”

Rule

Amend the definition of “dealer-restricted person” to substitute “Market
Trading Obligations” for “Market Maker Obligations”.

Approved

10-0113 – Apr. 23/10

11-0251 – Aug. 26/11

Aug. 26/11

1.1 – Definition of “DealerSponsored Access”

Rule

Provide a definition of “Dealer-Sponsored Access” as the right toaccess trading system of a marketplace granted by a Participant to an
institutional client.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

1.1–
Definition“derivative”

of

Rule

Introduce a definition of “derivative”.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1–
Definitionof“derivative-related cross”

Rule

Introduce a definition of “derivative-related cross”.

Approved

16-0123 – June 9/16

17-0039 – Feb 16/17

Sept 14/17

1.1–
Definitionof“derivative-related cross”

Rule

Amend the definition of “derivative-related cross” to replace reference
to “a related security that is a derivative instrument” with a “related
derivative”.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1–
Definitionof“derivatives market maker”

Rule

Amend the definition of “derivatives market maker” to include a person
performing Marketplace Trading Obligations in connection with a listed
derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1–
Definition
of“Designated Marketplace”

Rule

Provide a definition of a “Designated Marketplace” as any marketplace
to which an Access Person has access directly or by means of “DealerSponsored Access”.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

1.1–
Definition“designated trade”

of

Rule

Provide definition of “designated trade” to be used in connection with
the interpretation of rules governing the ability to undertake an “offmarketplace” trade.

Approved

2004-018 – Aug. 20/04
2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

1.1 – Definition of “directelectronic access”

Rule

Provide definition of “direct electronic access” to be used in connection
with clients accessing markets directly.

Approved

12-0315 – Oct. 25/12

13-0184 – Jul. 4/13

Mar. 1/14

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

4

Rule/
PolicyUMIR Reference

Rules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

1.1 – Definition of “directelectronic access”

Rule

Amend the definition of “direct electronic access” to include orders
relating to a derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “disclosed
volume”

Rule

Provide definition of “disclosed volume” to be used in connection with
the interpretation of rules governing the ability to undertake an “offmarketplace” trade.

Approved

2004-018 – Aug. 20/04
2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

1.1–
Definition“document”

of

Rule

Provide a definition of a document that must be retained for the
purposes of audit trail requirements and produced in connection withan investigation.

Approved

2004-019 – Aug. 13/04

2005-008 – Mar. 11/05

Mar. 11/05

1.1 – Definition of “Electronic
Trading Rules”

Rule

Provide definition of “Electronic Trading Rules” to align therequirements of UMIR to National Instrument 23-103 Electronic
Trading and its Companion Policy.

Approved

12-0200 – Jun. 28/12

12-0363 – Dec. 7/12

Mar. 1/13

1.1–
Definition“employee”

of

Rule

Provide that the term “employee” includes a person who has enteredinto an agency relationship with a Participant in accordance with theterms and conditions established by a self-regulatory entity of which
the Participant is a member.

Approved

2002-016 - Sept. 30/02

2003-012 – June 11/03

May 16/03

1.1 – Definition of “equity
security”

Rule

Provide a definition of an “equity security” that would be capable ofbeing an “offered security” or “connected security” for the purposes of
the restrictions and prohibitions regarding market stabilization andmarket balancing.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.1–
Definition“Exchange-traded Fund”

of

Rule

Provide a definition of an “Exchange-traded Fund” for the purpose of
exemptions from various requirements including the restrictions on
short sales.

Approved

2004-012 – Apr. 23/04

2004-023 – Aug. 27/04

Aug. 27/04

1.1–
Definition“Exchange-traded Fund”

of

Rule

Repeal the definition to be replaced by “Exempt Exchange-tradedFund”.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

1.1–
Definition“Exchange-traded Fund”

of

PolicyProvide a listing of factors to be taken into account prior to thedesignation of a security as an “Exchange-traded Fund”.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.1 – Definition of “Exempt
Exchange-traded Fund”

Rule

Provide a definition of “Exempt Exchange-traded Fund” as a listed orquoted mutual fund that is in continuous distribution unless such fundhas been designated as excluded from the definition by the Market
Regulator.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

1.1 – Definition of “Exempt
Exchange-traded Fund”

PolicyProvide the factors which the Market Regulator will consider when
designating a security as ineligible to be an “Exempt Exchange-traded
Fund.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

5

Rules/Market Integrity Notice

Rule/
PolicySummary of Amendment

Status

1.1 – Definition of “failed
trade”

Rule

Provide a definition of a trade that shall be considered a “failed trade”.

1.1 – Definition of “foreigndealer equivalent”

Rule

1.1 – Definition of “foreigndealer equivalent”

UMIR Reference

Effective
Date

Request forComments

Amendment Approval/ Withdrawal

Approved

2007-017 – Sept. 7/07

08-0143 – Oct. 15/08

Oct. 14/08

Provide definition of “foreign dealer equivalent” to be used inconnection with routing arrangements.

Approved

12-0315 – Oct. 25/12

13-0184 – Jul. 4/13

Mar.1/14

Rule

Amend the definition of “foreign dealer equivalent” to include persons
in the business of trading derivatives.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “foreignorganized regulated market”

Rule

Provide definition of “foreign organized regulated market” to be used inconnection with the interpretation of rules governing the ability toundertake an “off-marketplace” trade.

Approved

2004-018 – Aug. 20/04
2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

1.1 – Definition of “Global
Legal
EntityIdentifier
System”

Rule

Provide definition of “Global Legal Entity Identifier System” for the
purpose of providing client identifiers.

Approved

18-0122 – June 28/19

19-0071 – Apr. 18/19

Oct. 18/20

1.1 – Definition of “hearing”

Rule

Repeal the definition concurrent with the introduction of theConsolidated Enforcement Rule

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

1.1 – Definition of “Hearing
Committee”

Rule

Repeal the definition concurrent with the introduction of theConsolidated Enforcement Rule

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

1.1 – Definition of “Hearing
Panel”

Rule

Repeal the definition concurrent with the introduction of theConsolidated Enforcement Rule

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

1.1 – Definition of “highlyliquid security”

Rule

Provide a definition of a “highly-liquid security” that would be exempt
from the restrictions and prohibitions regarding market stabilization andmarket balancing.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.1 – Definition of “identified
order execution only client”

Rule

Provide a definition of “identified order execution only client” for the
purpose of providing client identifiers

Approved

18-0122 – June 28/18

19-0071 – Apr. 18/19

Oct. 18/20

1.1 – Definition of “intentionalcross”

Rule

Revise the definition of “intentional cross” to recognize that such a
trade may be executed by an Access Person.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

1.1 – Definition of “internalcross”

Rule

Revise the definition of “internal cross” to recognize that such a trade
may be executed by an Access Person.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

1.1 – Definition of “internalcross”

Rule

Revise the definition of “internal cross” to mean an intentional cross ina security.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “issuerrestricted person”

Rule

Provide a definition of an “issuer-restricted person” that would be
subject to the restrictions and prohibitions regarding market
stabilization and market balancing.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

6

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

1.1 – Definition of “lastindependent sale price”

Rule

Provide a definition of a “last independent sale price” setting amaximum price at which a dealer-restricted person may acquire a
restricted security during a restricted period.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.1 – Definition of “lastindependent sale price”

Rule

Repeal the definition of “last independent sale price”.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

1.1 – Definition of “last saleprice”

Rule

Provide that a Basis Order, Call Market Order or Volume-Weighted
Average Price Order would not set the last sale price.

Approved

2004-030 – Nov. 26/04

2005-010 – Apr. 8/05

Apr. 8/05

1.1 – Definition of “last saleprice”

Rule

Amend the definition of “last sale price” to clarify that “specialty” typeorders are excluded from the determination.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

1.1 – Definition of “last saleprice”

Rule

Amend the definition of “last sale price” to clarify that “specialty” typeorders are excluded from the determination as well as a Special Terms
Order unless it has executed with an order other than another Special
Terms Order.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

1.1 – Definition of “last saleprice”

Rule

Amend the definition of “last sale price” to clarify that the execution
price is to be rounded off to the nearest trading increment.

Withdrawn

11-0225 – Jul. 29/11

12-0130 – Apr. 13/12

1.1 – Definition of “last saleprice”

Rule

Amend the definition of “last sale price” to include the price of the lastsale of at least one standard trading unit of an option traded on an
Exchange.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

1.1 – Definition of “Last Sale
Price Order”

Rule

Provide a definition of a “Last Sale Price Order” that allows “follow-on”
trades at the last sale price of the security on that marketplace in amanner applicable to all marketplaces but to encompass the “Special
Trading Session” on the TSX and the follow-on session proposed byMarkets Inc.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

1.1 – Definition of “Legal
Entity Identifier”

Rule

Provide a definition of Legal Entity Identifiers for the purpose of client
identifiers

Approved

18-0122 – June 28/18

19-0071 – Apr. 18/19

Oct. 18/20

1.1 – Definition of “Legal
EntityIdentifier
SystemRegulatory
Oversight
Committee”

Rule

Provide a definition of “Legal Entity Identifier System Regulatory
Oversight Committee” for the purpose of client identifiers.

Approved

18-0122 – June 28/19

19-0071 – Apr. 18/19

Oct. 18/20

1.1 – Definition of “limit
order”

Rule

Amend the definition of “limit order” to include orders in a derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “listed
derivative”

Rule

Introduce a definition of “listed derivative”.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

Mar. 9/07

Dec. 14/22

7

Rule/
PolicyUMIR Reference

Rules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

1.1 – Definition of “Marketon-Close Order”

Rule

Revise the definition of “Market-on-Close Order” to clarify that suchorder is used for the purpose of calculating the closing price.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

1.1 – Definition of “Market
Maker Obligations”

Rule

Repeal the definition of “Market Maker Obligations”.

Approved

10-0113 – Apr. 23/10

11-0251 – Aug. 26/11

Aug. 26/11

1.1 – Definition of “market
order”

Rule

Amend the definition of “market order” to include orders in a derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 Definition“Marketplace”

of

Rule

Housekeeping amendments to make consequential changes to thedefinition of a “marketplace” in UMIR to ensure consistency with IIROC
By‑law No. 1 (the By-law).

Approved

21-0193 – Oct 21/21

Oct. 21/21

1.1
Definition“Marketplace”

of

Rule

Replace reference to “IIROC” with “Corporation” following theamalgamation of IIROC and the MFDA into New SRO.

Approved

25-304- May 1/22

25-307 – Nov. 24/22

Jan. 1/23

1.1–
Definitionof“Marketplace Eligible Client”

Rule

Provide a definition of “Marketplace Eligible Client” as a client eligible
to obtain Dealer-Sponsored Access in accordance with therequirements of the marketplace to which access is to be provided.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

1.1–
Definition“Marketplace Rules”

of

Rule

Amend the definition of “Marketplace Rules” to exclude rules, policies
and other similar instruments related solely to the listing of derivatives
on an Exchange.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1–
Definitionof“Marketplace
Trading
Obligations”

Rule

Provide a definition of “Marketplace Trading Obligations” as obligations
imposed by Marketplace Rules or a contract between a marketplace
and a member, user or subscriber.

Approved

10-0113 – Apr. 23/10

11-0251 – Aug. 26/11

Aug. 26/11

1.1–
Definitionof“Marketplace
Trading
Obligations”

Rule

Amend the definition of “Marketplace Trading Obligations” to include
obligations imposed by Marketplace Rules to guarantee a two-sided
market for a listed derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “multiple
client order”

Rule

Provide a definition of “multiple client order” for orders sent to amarketplace for more than one client.

Approved

18-0122 – June 28/18

19-0071 – Apr. 18, 2019

Oct. 18/20

1.1 – Definition of “nonCanadian account”

Rule

Provide definition of “non-Canadian account” to be used in connection
with the interpretation of rules governing the ability to undertake an “offmarketplace” trade.

Approved

2004-018 – Aug. 20/04
2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

1.1 – Definition of “non-client
order”

Rule

Amend the definition of “non-client order” to include an order for thepurchase or sale of a derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “offeredsecurity”

Rule

Provide a definition of a security which is being offered in a distribution,
amalgamation, take-over bid, issuer bid, arrangement or other similartransaction.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

8

Rule/
PolicyUMIR Reference

Rules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

1.1 – Definition of “Opening
Order”

Rule

Amend the definition of “Opening Order” to clarify that after the initialtrade such orders cease to be an Opening Order.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

1.1 – Definition of “Opening
Order”

Rule

Amend the definition of “Opening Order” to clarify that the order must
be entered prior to the commencement of trading and after the initialtrade such orders cease to be an Opening Order.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

1.1 – Definition of “order
execution service”

Rule

Provide definition of “order execution service” to be used in connection
with third-party electronic access.

Approved

12-0315 – Oct. 25/12

13-0184 – Jul 4/13

Mar. 1/14

1.1 – Definition of “order
execution service”

RuleHousekeeping amendment to align with the final IIROC rules.

Approved

20-0042

20-0042 – Mar 5/20

Mar 5/20

1.1 – Definition of “order
execution service”

Rule

Replace reference to “IIROC” with “Corporation” following theamalgamation of IIROC and the MFDA into New SRO.

Approved

25-304- May 1/22

25-307 – Nov. 24/22

Jan. 1/23

1.1–
Definition“Participant”

of

Rule

Expand the definition of “Participant” to include a dealer able to act as
an intermediary on behalf of clients in respect of securities traded on amarketplace who has “Dealer-Sponsored Access” to a marketplace.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

1.1–
Definition“Participant”

of

Rule

Expand the definition of “Participant” to include an investment dealer
party to a routing arrangement under certain circumstances.

12-0315 – Oct. 25/12

13-0184 – Jul 4/13

Mar. 1/14

1.1 – Definition of “prearranged trade”

Rule

Provide definition of “pre-arranged trade” to be used in connection with
the interpretation of rules governing the ability to undertake an “offmarketplace” trade.

Approved

2004-018 – Aug. 20/04
2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

1.1 – Definition of “principal
order”

Rule

Amend the definition of “principal order” to include an order for thepurchase or sale of a derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “Policy”(French version of UMIR)

Rule

Standardize the use of the term “Policy” in the French version of UMIR.

Approved

2004-031 – Dec. 1/04

Nov. 12/04

1.1 – Definition of “Policy”(French version of UMIR)

PolicyStandardize the use of the term “Policy” in the French version of UMIR.

Approved

2004-031 – Dec. 1/04

Nov. 12/04

1.1 - Definition of “PreBorrow Security”

Rule

Provide a definition of a “Pre-Borrow Security” to be used in connection
with the interpretation of rules governing “short sales” and “failed
trades”.

Approved

11-0075 – Feb. 25/11

12-0078 – Mar. 2/12
12-0158 – May 8/12

Oct. 15/12

1.1 - Definition of “PreBorrow Security”

PolicyAdd Part 2.1 with respect to the definition of a “Pre-Borrow Security” tobe used in connection with the interpretation of rules governing “shortsales”.

Approved

11-0075 – Feb. 25/11

12-0078 – Mar. 2/12
12-0158 – May 8/12

Oct. 15/12

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

Withdrawn

9Rule/
PolicyUMIR Reference

Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

1.1 – Definition of “protectedmarketplace”

Rule

Amend the definition of “protected marketplace” to restrict thisdesignation to those marketplaces that meet the CSA’s threshold for
purposes of “protected bid” and “protected offer” and to an exchange,
with respect to the securities that it lists.

Withdrawn

14-0124 – May 15/14

1.1 – Definition of “protectedmarketplace”

Rule

Amend definition of “protected marketplace” to be a marketplace that
displays orders that are considered to be “protected orders” for the
purposes of the Trading Rules.

Approved

15-0129 – June 12/15

15-0211 – Sept 18/15

Sept 18/15

1.1 – Definition of “Regulated
Person”

Rule

Extend the definition of “Regulated Person” to include a person subject
to the rules of a marketplace (so that persons subject to a marketplace
rule but not subject to UMIR may be disciplined in accordance with the
UMIR procedure).

Approved

2003-022 – Oct. 24/03

2004-006 – Feb. 6/04

Feb. 6/04

1.1 – Definition of “Regulated
Person”

Rule

Change the defined term from “Regulated Person” to “Subject Person”
to reflect the introduction of the term “Regulated Person” in theConsolidated Enforcement Rule 1

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

1.1 – Definition of “related
derivative”

Rule

Introduce a definition of “related derivative”.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “related
security”

Rule

Amend the definition of a “related security” to remove the concept ofderivatives instruments that are related to a particular security.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of“Representative”

Rule

Provide a definition of “Representative” as each director, officer or
employee of an Access Person who may enter an order to a
Designated Marketplace or is responsible to the supervision of theentry of such an order.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

of

Rule

Specifically include “applicable securities legislation” as part of thedefinition of a “Requirement” to which Participants and Access Persons
are subject.

Approved

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

2005-011 – Apr. 1/05

Apr. 1/05

1.1 – Definition of “restrictedperiod”

Rule

Provide a definition of a “restricted period” during which the restrictions
and prohibitions regarding market stabilization and market balancing
would apply.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.1–
Definition“Requirement”

1

Rules/Market Integrity Notice

As a consequence of the change in the defined term from “Regulated Person” to “Subject Person”, references in Rules 10.1, 10.5, 10.9 and 11.10 and Policy 10.1 would also be changed. These
consequential changes are not separately identified in this table.

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

10

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

1.1 – Definition of “restrictedperiod”

Rule

Amend the definition of “restricted period” to clarify when the restrictedperiod commences in a continuous distribution, non-fixed pricedistribution or at-the-market distribution and clarifying that the restrictedperiod may end even though “green shoe” options remain outstanding.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

1.1 – Definition of “restrictedprivate placement”

Rule

Provide a definition of a “restricted private placement” to which therestrictions and prohibitions regarding market stabilization and market
balancing would apply.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.1 – Definition of “restrictedprivate placement”

Rule

Amend the definition of “restricted private placement” to reflectchanges in the applicable National Instruments and OSC Rules.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

1.1 – Definition of “restrictedsecurity”

Rule

Provide a definition of a “restricted security” that would be subject tothe restrictions and prohibitions regarding market stabilization andmarket balancing.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.1 – Definition of “routing
arrangement”

Rule

Provide a definition of “routing arrangement” to be used as part of thirdparty electronic access to marketplaces.

12-0315 – Oct. 25/12

13-0184 - Jul 4/13

Mar. 1/14

1.1 – Definition of “routing
arrangement”

Rule

Amend the definition of “routing arrangement” to include orders relating
to a derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 - Definition of “shortmarking exempt order”

Rule

Provide a definition of a “short marking exempt order” that would relieve
an account from having to mark a sale as being “short”.

Approved

11-0075 – Feb. 25/11

12-0078 – Mar. 2/12
12-0158 – May 8/12

Oct. 15/12

1.1 - Definition of “shortmarking exempt order”

Rule

Amend the definition of “short marking exempt order” to include anorder for an Exempt Exchange Traded Fund or one of its underlying
securities for the principal account of a Participant that has Marketplace
Trading Obligations for the ETF security or has entered into anagreement with the ETF issuer to maintain a continuous distribution of
the ETF.

Approved

15-0159 – July 16/15

16-0028 – Feb. 11/16

Apr. 11/16

1.1 – Definition of “shortmarking exempt order”

Rule

Amend the definition of “short marking exempt order” to replace nonclient with Dealer Related Person

Withdrawn

19-0157 – Sept. 5/19

21-0009 – Jan 14/21

1.1 – Definition of “shortmarking exempt order”

RuleHousekeeping amendments to correct typographical errors and toensure consistency between the English and the French versions of
the rule.

Approved

1.1 - Definition of “short sale”

Rule

Deem a person to be short a security if the contract they hold to acquire
the security will not settle within the ordinary settlement period.

Approved

1.1 – Definition of “short
sale”

Rule

Clarify the circumstances when a seller is considered to own a security
as a result of the conversion or exchange of another security.

Approved

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

Approved

23-0107 – Jul. 27/23

Jul. 27/23

2004-012 – Apr. 23/04

2004-023 – Aug. 27/04

Aug. 27/04

2007-017 – Sept. 7/07

08-0143 – Oct. 15/08

Oct. 14/08

11

Rule/
PolicyUMIR Reference

Rules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

1.1 – Definition of “shortsale”

PolicyClarify when an option, right or warrant has been considered to be
exercised or a convertible or exchangeable security has been
considered to be converted or exchanged.

Approved

2007-017 – Sept. 7/07

08-0143 – Oct. 15/08

Oct. 14/08

1.1 – Definition of “Short
Sale Ineligible Security”

Rule

Provide a definition of a security which is not eligible to be sold short.

Approved

2007-017 – Sept. 7/07

08-0143 – Oct. 15/08

Oct. 14/08

1.1 – Definition of “Short
Sale Ineligible Security”

PolicySpecify the factors that a Market Regulator shall consider in making adesignation of a security or class of securities which is not eligible tobe sold short.

Approved

08-0143 – Oct. 15/08

Oct. 14/08

1.1 – Definition of “Special
Terms Order”

Rule

Amend the definition of “Special Terms Order” to exclude other“specialty” orders and to clarify that conditions on the order are otherthan imposed by a marketplace.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

1.1 – Definition of “Special
Terms Order”

Rule

Amend the definition of “Special Terms Order” to exclude other“specialty” orders and to clarify that conditions on the order are otherthan imposed by a marketplace.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

1.1 – Definition of “Special
Terms Order”

Rule

Amend the definition of “Special Terms Order” to harmonize with theT+1 settlement cycle by shortening delivery and settlement periods by
one day.

Approved

23-0054 – April 20, 2023

23-0150 – Oct. 26/23

May 27/24

1.1 – Definition of “standard
trading unit”

Rule

Amend the definition of “standard trading unit” to replace “derivative
instrument” with “listed derivative”.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.1 – Definition of “trading
increment”

Rule

Provide definition of “trading increment” to be used in connection with
the interpretation of rules governing the ability to undertake an “offmarketplace” trade.

Approved

2004-018 – Aug. 20/04
2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

Replace reference to “Investment Industry Regulatory Organization of
Canada” with “Corporation” following the amalgamation of IIROC andthe MFDA into New SRO.

Approved

25-304- May 1/22

25-307 – Nov. 24/22

Jan. 1/23

Housekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

Rule

Amend section 1.2 to align the requirements of UMIR to National
Instrument 23-103 Electronic Trading and its Companion Policy.

Approved

12-0200 – Jun. 28/12

12-0363 – Dec. 7/12

Mar. 1/13

1.1 – Definition of “UMIR”

1.1 – Definitions (French
version of UMIR only)
1.2 – Interpretation

Rule and
Policy1.2(2) –“trade”

Interpretation

–

Rule

Expand the interpretation of “trade” to include a purchase or acquisitionof a derivative for valuable consideration.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.2(2) –“security”

Interpretation

–

Rule

Provide that a “security” does not include a “derivative”.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

12

Rule/
PolicyUMIR Reference

Rules/Market Integrity Notice
Summary of Amendment

Status

Effective
Date

Request forComments

Amendment Approval/ Withdrawal

09-0328 – Nov. 13/09

11-0036 -- Jan. 28/11

Feb. 1/11

13 - 0294 - Dec. 9/13

Dec. 9/13

1.2(3) – Interpretation“value of an order”

–

Rule

Provide the means for valuing an order to be executed on a foreignorganized regulated market.

Approved

1.2(3) – Interpretation“value of an order”

–

Rule

Housekeeping to French rules only for translation consistency.

Approved

1.2(5) – Interpretation –“Price for Determination of‘standard trading units’”

Rule

Editorial change to confirm industry practice that marketplaces canagree to refer to the listing exchange when measuring the last saleprice to determine “standard trading unit”

Withdrawn

14-0124 – May 15/14

1.2(5) – Interpretation –“Price for Determination of“standard trading unite””

Rule

Editorial change to confirm industry practice that the price of a“standard trading unit” shall be the last sale price of the security on theimmediately preceding trading day on the exchange on which thesecurity is listed or the ATRS on which the security is quoted.

Approved

15-0129 – June 12/15

15-0211 – Sept 18/15

Sept 18/15

1.2(6) – Interpretation“restricted period”

–

Rule

Provide an interpretation of the term “restricted period” as to whenselling efforts and stabilization arrangements are considered to be atan end.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.2(6) – Interpretation“restricted period”

–

Rule

Expand the interpretation of “restricted period” to provide that if theprice of an offering is determined by a formula involving trading activity,
the offering price is considered determined on the first trading day
included in the calculation.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

1.2(6) – Interpretation“restricted period”

–

Rule

Provide an interpretation of the term “restricted period” to specify whenstabilization arrangements are considered to have terminated.

Approved

10-0006 – Jan. 8/10

Jan. 8/10

1.2(7) – Interpretation“associated entity”

–

Rule

Provide an interpretation of the term “associated entity” as including
the meaning ascribed to “associate” in securities legislation andincludes a person holding 10% of voting securities.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.2(8) – Interpretation – “bestask price” and “best bid
price”

Rule

Provide that the determination of “best ask price” or “best bid price” isby reference to order in a consolidated market display for amarketplace then open for trading and in respect of which trading has
not been halted, suspended or delayed.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

1.2(8) – Interpretation – “bestask price” and “best bid
price”

Rule

Makes a consequential amendment to reflect UMIR changes to alignwith CSA amendments regarding the order protection rule.

Withdrawn

14-0124 – May 15/14

1.2(8) – Interpretation – “bestask price” and “best bid
price”

Rule

Makes a consequential amendment to reflect that the “best ask price”
or “best bid price” is based on orders contained in a consolidated
market display for a protected marketplace.

Approved

15-0129 – June 12/15

15-0211 – Sept 18/15

Sept 18/15

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

13

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

1.2(8) – Interpretation – “bestask price” and “best bid
price”

Rule

Provide that the determination of “best ask price” or “best bid price” isby reference to orders displayed on an Exchange then open for tradingwith respect to a particular derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

1.2 – Interpretation – Part 1 “acting jointly or in concert”

PolicyProvide an interpretation of the term “acting jointly or in concert” withrespect to determining a dealer-restricted person or an issuer-restrictedperson that would be subject to prohibitions or restrictions inconnection with market stabilization or market balancing activities.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.2 – Interpretation – Part 2 “selling process has ended”

PolicyProvide an interpretation of the term “selling process has ended” withrespect to determining the end of a restricted period in connection withmarket stabilization.

Approved

2003-018 – Aug. 29/03
2004-024 – Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

1.2 – Interpretation – Part 3 “ought reasonably to know”

PolicyAdopt an interpretation of the phrase “ought reasonably to know”(which would be applicable to rules on manipulative and deceptive
activities).

Approved

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

2005-011 – Apr. 1/05

Apr. 1/05

1.2 – Interpretation – Part 4 “applicableregulatory
standards”

PolicyAdopt an interpretation of the phrase “applicable regulatory standards”(which would be applicable to rules governing trading supervision andgatekeeper obligations).

Approved

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

2005-011 – Apr. 1/05

Apr. 1/05

1.2 – Parts 1 to 4

PolicyHousekeeping to French rules only for translation consistency.

Approved

13 -0294 - Dec. 9/13

Dec. 9/13

1.3 - Transitional Provision

Rule

Provide the New SRO is the Corporation continuing from theamalgamation between IIROC and the MFDA, and to provide for thecontinued jurisdiction of the New SRO over any persons subject to the
IIROC rules before the amalgamation.

Approved

25-304 - May 1/22

25-307 – Nov. 24/22

Jan. 1/23

2.1 – Just and Equitable
Principles

Rule

Repeal the present provisions concurrent with the introduction of Rule1402 – Standards of Conduct as part of the Consolidated Enforcement
Rule. Replace with a provision “Specific Unacceptable Activities” thatis based on current Policy 2.1. 2

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

2.1 – Just and Equitable
Principles

Rule

Housekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

2

As a consequence of the change in the title of Rule 2.1 from “Just and Equitable Principles” to “Specific Unacceptable Activities”, references in Rules 10.4, 10.16 and Policy 6.4 would also be changed.
These consequential changes are not separately identified in this table.

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

14

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

2.1 – Just and Equitable
Principles

PolicyProvide that a Participant or Access Person who fails to takereasonable efforts to execute as against “better-priced” orders on
another marketplace will be considered to have failed to conduct trade
openly and fairly. (Proposal withdrawn and replaced with a provision
for a specific trade-through obligation as set out in Market Integrity
Notice 2005-016.)

Withdrawn

2004-018 – Aug. 20/04

2005-012 – Apr. 29/05

2.1 – Just and Equitable
Principles

PolicyRedefine the parameters for moving the market for a pre-arranged
trade or intentional cross to require orders over at least 5 minutes if theprice of the intended trade is more than 5% or 10 trading increments
below the best bid price or 5% or 10 trading increments above best ask
price. The time period would be expanded to 10 minutes if the variation
is more than 10%. Provide that the “displacement obligation” for adesignated trade is limited to the disclosed volume. Clarify theenumerated examples would not be in compliance with requirement to
conduct business openly and fairly and in accordance with just andequitable principles of trade.

Approved

2004-018 – Aug. 20/04
2005-012 – Apr. 29/05

2008-008 – May 16/08

2.1 – Just and Equitable
Principles

PolicyModify the examples of abuse of a market maker to be generic for all
marketplaces with a market making system.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

2.1 – Just and Equitable
Principles

PolicyModify the examples of abuse of a market maker to be generic for all
marketplaces with a market making system.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

2.1 – Just and Equitable
Principles

PolicyProvide that attempts to “re-age” failed trades to avoid reporting
requirements shall be considered an unacceptable activity.

Approved

2007-017 – Sept. 7/07

08-0143 – Oct. 15/08

Oct. 14/08

2.1 – Just and Equitable
Principles

PolicyAmend Part 1 (d) to refer to Marketplace Trading Obligations.

Approved

10-0113 – Apr. 23/10

11-0251 – Aug. 26/11

Aug. 26/11

2.1 – Just and Equitable
Principles

PolicyRepeal the present provisions concurrent with the introduction of Rule1402 – Standards of Conduct as part of the Consolidated Enforcement
Rule. The substance of the Policy will be incorporated in a new Rule
2.1 “Specific Unacceptable Activities”.

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

2.1 – Just and Equitable
Principles

PolicyHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

2.1 – Just and Equitable
Principles

PolicyMakes a consequential amendment to clarify requirements for the
execution of a designated trade, to align with CSA amendments
regarding the order protection rule.

Withdrawn

14-0124 – May 15/14

2.1 – Just and Equitable
Principles

PolicyPart 2 of Policy 2.1 was amended to accommodate unprotectedtransparent marketplaces.

Approved

15-0129 – June 12/15

15-0211 – Sept 18/15

Sept 18/15

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

May 16/08

15

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

Status

2.1 – Specific Unacceptable
Activities

Rule

Housekeeping amendments to correct typographical errors and toensure consistency between the English and the French versions of
the rule. .

Approved

2.2 – Manipulative
Deceptive Activities

and

Rule

Rewrite of the existing provisions as required to provide for two
separate prohibitions – one being a prohibition against using an
manipulative or deceptive method, act or practice and the other being
a prohibition against entering an order or executing a trade that createsor could reasonably be expected to create either a false or misleading
appearance of trading activity or investor interest in a security or an
artificial price.

Approved

2.2 – Manipulative
Deceptive Activities

and

Rule

Amend subsection (3) to refer to Marketplace Trading Obligations.

Approved

2.2 – Manipulative
Deceptive Activities

and

Rule

Housekeeping to French rules only for translation consistency.

Approved

2.2 – Manipulative
Deceptive Activities

and

Rule

Amend paragraphs (2)(a) and 2(b) to prohibit certain manipulative anddeceptive activities in a derivative, a related security or a related
derivative.

Approved

2.2 – Manipulative
Deceptive Activities

andPolicyMove the examples of what constitutes a manipulative or deceptive
method of trading or an order that may create a false or misleading
appearance of trading activity or investor interest in a security or an
artificial price from the rule to the policies. Specifically provide that
activities known as “free-riding, kiting or debit kiting” will be considered
manipulative.

2.2 – Manipulative
Deceptive Activities

andPolicy2.2 – Manipulative
Deceptive Activities

and2.2 – Manipulative
Deceptive Activities
2.2 – Manipulative
Deceptive Activities

Request forComments

Amendment Approval/ Withdrawal

Effective
Date

23-0107 – Jul. 27/23

Jul. 27/23

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

2005-011 – Apr. 1/05

Apr. 1/05

10-0113 – Apr. 23/10

11-0251 – Aug. 26/11

Aug. 26/11

13 - 0294 - Dec 9/13

Dec. 9/13

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

Approved

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

2005-011 – Apr. 1/05

Apr. 1/05

Delete clause (d) in Part 1.

Approved

11-0075 – Feb. 25/11

12-0078 – Mar. 2/12
12-0158 – May 8/12

Oct. 15/12

PolicyHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec 9/13

Dec. 9/13

andPolicyAmend Parts 1, 2 and 3 of Policy 2.2 to prohibit certain manipulativeand deceptive activities in a derivative, a related security and/or a
related derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

andPolicyAmend Part 2 of Policy 2.2 to provide that the prohibition on
prearranged trades may not apply to certain prearranged trades as
determined by New SRO from time to time.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

16

UMIR Reference
2.2 – Manipulative
Deceptive Activities

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusandPolicyHousekeeping amendments to correct typographical errors and toensure consistency between the English and the French versions of
the rule .

Approved

2.3 - Improper Orders andTradesRuleProvide that a Participant or Access Person may not enter an order or
execute a trade if they know or ought to know that the entry or
execution of the order would not be in compliance with applicablesecurities legislation, requirements of a self-regulatory organization ofwhich they are a member, rules of the marketplace on which the orderis entered or executed or UMIR.

Approved

2.4–
Obligation

Trade-Through

Rule

Provide that Participants and Access Persons must make reasonable
efforts to access better-priced orders on a marketplace prior to
executing a trade as principal at an inferior price on another market.

2.4–
Obligation

Trade-ThroughPolicy3.1 – Restrictions on Short
Selling

Request forComments

Amendment Approval/ Withdrawal

Effective
Date

23-0107 – Jul. 27/23

Jul. 27/23

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

2005-011 – Apr. 1/05

Apr. 1/05

Withdrawn

2005-016 – May 12/05

08-0162 – Oct. 27/08

Provide guidance on: the application of the trade-through rule; thedetermination of “reasonable efforts”; and the impact of orders frommarket makers in accordance with Marketplace Rules.

Withdrawn

2005-016 – May 12/05

08-0162 – Oct. 27/08

RuleProvide an exemption from the pricing restrictions for trades in
Exchange-traded Funds.

Approved

2004-012 – Apr. 23/04

2004-023 – Aug. 27/04

Aug. 27/04

3.1 – Restrictions on Short
Selling

Rule

Change the reference in the exemption from “Exchange-traded Fund”
to “Exempt Exchange-traded Fund”.

Approved

10-0006 – Jan. 8/10

Jan. 8/10

3.1 – Restrictions on Short
Selling

RuleProvide that a “Basis Order” is exempt from the price restrictions on ashort sale.

Approved

2004-030 – Nov. 26/04

2005-010 – Apr. 8/05

Apr. 8/05

3.1 – Restrictions on Short
Selling

RuleProvide an exemption from the price restriction on short sales if thesale is being undertaken in accordance with a requirement to move themarket to execute a trade at a price lower than the prevailing market.

Approved

2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

3.1 – Restrictions on Short
Selling

RuleProvide that a “Last Sale Price Order” is exempt from the pricerestrictions on a short sale.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

3.1 – Restrictions on Short
Selling

RuleProvide that a “Closing Price Order” is exempt from the pricerestrictions on a short sale.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

3.1 – Restrictions on Short
Selling

Rule

Repeal the restrictions on the price at which a short sale may be made.

Withdrawn

2007-017 – Sept. 7/07

11-0075 – Feb. 25/11

3.1 – Restrictions on Short
Selling

Rule

Amend subsection (2) to refer to Marketplace Trading Obligations.

Approved

10-0113 – Apr. 23/10

11-0251 – Aug. 26/11

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

Mar. 9/07

Aug. 26/11

17

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

3.1 – Restrictions on Short
Selling

Rule

Repeal the Rule in its entirety.

Approved

11-0075 – Feb. 25/11

12-0078 – Mar. 2/12
12-0158 – May 8/12

Oct. 15/12

3.1 – Restrictions on Short
Selling

PolicyRepeal the Policy in its entirety.

Approved

11-0075 – Feb. 25/11

12-0078 – Mar. 2/12

Oct. 15/12

3.2 – Prohibition on the Entryof Orders

Rule

Provide that a Participant or an Access Person shall not enter an order
on a marketplace that, on execution, would be a short sale unless it ismarked as such or it is a Short Sale Ineligible Security and provide for
exceptions to the general prohibition.

Approved

08-0143 – Oct. 15/08

Oct. 14/08

3.2 – Prohibition on the Entryof OrdersRule

Amend subsection (2) and (3) to refer to Marketplace Trading
Obligations.

Approved

10-0113 – Apr. 23/10

11-0251 – Aug. 26/11

Aug. 26/11

3.2 – Prohibition on the Entryof OrdersRule

Amend subsections (1) and (2) in respect of references to ‘’shortmarking exempt orders’’.

Approved

11-0075 – Feb. 25/11

12-0078 – Mar. 2/12

Oct. 15/12

4.1 – Frontrunning

Rule

Clarify the “markets” in which a Participant may not enter a principal or
non-client order in advance of a client order that may affect the price ofa security.

Approved

2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

4.1 – Frontrunning

PolicyHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec 9/13

Dec. 9/13

4.1 – Frontrunning

Rule

Amendments to 4.1(1) and (2) and to replace non-client order with
Dealer Related Person order.

Withdrawn

19-0157 – Sept. 5/19

21-0009 – Jan 14/21

4.1 – Frontrunning

Rule and
PolicyAmendments to extend the prohibition on frontrunning to orders in alisted derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

4.1 – Frontrunning

PolicyAmendments to Part 2 to replace non-client order with Dealer Related
Person order.

Withdrawn

19-0157 – Sept. 5/19

21-0009 – Jan 14/21

4.1 – Frontrunning

PolicyAmend Part 1 of Policy 4.1 to include trades in derivatives and to
replace “related options or futures contracts” with “related
derivatives”.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

Dec. 14/22

5.1 – Best
Obligation

Execution

Rule

Harmonize the language of the rule to requirements proposed under
National Instrument 23-101.

Approved

2007-008 – Apr. 20/07

08-0039 – July 18/08

Sept. 12/08

5.1 – Best
Obligation

Execution

PolicyProvide the factors that the Market Regulator will consider when
determining whether a Participant has diligently pursued the best
execution of a client order.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

18

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

5.1 – Best
Obligation

Execution

PolicyHarmonize the language of the policy to requirements proposed under
National Instrument 23-101 and clarify factors to be taken into
consideration.

Approved

2007-008 – Apr. 20/07

08-0039 – July 18/08

Sept. 12/08

5.1 – Best
Obligation

Execution

PolicyRepeal and replace Part 4 to clarify that the provision of the ‘’best
execution’’ for a client order is subject to compliance with the ‘’orderprotection rule’’ under Part 6 of the Trading Rules.

Approved

08-0163 – Oct. 27/08
09-0328 – Nov. 13/09

11-0036 – Jan. 29/11

Feb. 1/11

5.1 – Best
Obligation

Execution

PolicyHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec 9/13

Dec. 9/13

5.1 – Best
Obligation

Execution

RuleBest Execution obligations moved from UMIR to the Dealer Member
Rules

Approved

15-0277 – Dec. 10/15

17-0137 – July 6/17

Jan. 2/18

5.1 – Best
Obligation

Execution

PolicyBest Execution obligations moved from UMIR to the Dealer Member
Rules

Approved

15-0277 – Dec 10/15

17-0137 – July 6/17

Jan. 2/18

5.2 – Best Price Obligation

Rule

Provide that a “Basis Order” is exempt from the best price obligation.

Approved

2004-030 – Nov. 26/04

2005-010 – Apr. 8/05

Apr. 8/05

5.2 – Best Price Obligation

Rule

Provide that a “Last Sale Price Order” is exempt from the best priceobligation.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

5.2 – Best Price Obligation

Rule

Provide that a “Closing Price Order” is exempt from the best priceobligation.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

5.2 – Best Price Obligation

Rule

Remove the consideration of transaction costs from the calculation ofcompliance with “best price” obligation.

Approved

2008-009 – May 16/08

09-0107 – Apr. 17/09

May 16/08

5.2 – Best Price Obligation

Rule

Repeal the provision in its entirety.

Approved

08-0163 – Oct. 27/08
09-0328 – Nov. 13/09

11-0036 -- Jan. 28/11

Feb. 1/11

5.2 – Best Price Obligation

PolicyProvide a specific mechanism for determining whether a “better price”
exists on a marketplace (with the test being the same as adopted under
Rule 7.5 for the reporting in Canadian currency internal crosses andintentional crosses that have been negotiated in a foreign currency).
Make consequential amendments to refer to “organized regulated
markets”.

Approved

2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

5.2 – Best Price Obligation

PolicyModify the “best price obligation” in recognition of a specific tradethrough obligation applicable to Participants when trading as principal
or agent.

Withdrawn

2005-016 – May 12/05

08-0162 – Oct. 27/08

5.2 – Best Price Obligation

PolicyRevise the factors that the Market Regulator will consider when
determining whether a Participant has used “reasonable efforts” toensure that a client order receives the best price.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

Mar. 9/07

19

UMIR Reference

Rule/
Policy5.2 – Best Price Obligation

Rules/Market Integrity Notice
Summary of Amendment

Status

PolicyExpand the factors which may be taken into consideration in
determining whether a Participant has taken reasonable efforts toobtain the best price on the execution of an order.

5.2 – Best Price Obligation

Policy5.3 – Client Priority

Effective
Date

Request forComments

Amendment Approval/ Withdrawal

Approved

2008-009 – May 16/08

09-0107 – Apr. 17/09

May 16/08

Repeal the provision in its entirety.

Approved

08-0163 – Oct. 27/08
09-0328 – Nov. 13/09

11-0036 -- Jan. 28/11

Feb. 1/11

RuleProvide that a Participant would not have to provide priority to a client
order if the client order had been entered “anonymously” on amarketplace directly by a client and the Participant was not aware thatthe order was a client order until execution of the order.

Approved

2002-015 - Sept. 30/02

2003-024 – Oct. 31/03

Oct. 31/03

5.3 – Client Priority

Rule

Introduce a client priority requirement based on the provision includedin the version of UMIR published in October of 2001 that recognizes
multiple marketplaces trading the same securities.

Approved

2005-017 – June 10/05

2006-012 – May 26/06

May 26/06

5.3 – Client Priority

Rule

Provide that a “Last Sale Price Order” is exempt from the requirement
to provide client priority.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

5.3 – Client Priority

Rule

Provide that a Participant cannot enter on a marketplace a principal
order or non-client order that the Participant, based on the information
known or reasonably available to the person or persons originating or
entering the principal order or non-client order, knows or should have
known will execute or have a reasonable likelihood of executing inpriority to a client order received by the Participant prior to the entry of
the principal or non-client order and the client or is for the same or abetter price. In addition, provide that a Participant may rely on the
allocations made by the trading system of a marketplace if the client
has instructed that the client order is to be entered on a particularmarketplace.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

5.3 – Client Priority

Rule

Amend subparagraph (2)(b)(i) to refer to the Marketplace Trading
Obligations.

Approved

10-0113 – Apr. 23/10

11-0251 – Aug. 26/11

Aug. 26/11

5.3 – Client Priority

Rule

Amend subsection (1) to refer to a “foreign organized regulated
market”.

Withdrawn

12-0131 – Apr. 13/12

5.3 – Client Priority

Rule

Housekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec 9/13

Dec. 9/13

5.3 – Client Priority

PolicyMake consequential amendments to the Policy to reflect changes to
the Rule.

Approved

2007-002 – Feb. 26/07

Mar. 9/07

5.3 – Client Priority

PolicyHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec 9/13

Dec. 9/13

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

2006-019 – Oct. 6/06

20

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

5.3 – Client Priority

PolicyMakes a consequential amendment to provide an example ofintentionally trading ahead of a client, to align with the CSA
amendments regarding the order protection rule.

Withdrawn

14-0124 – May 15/14

5.3 – Client Priority

PolicyPart 4 of Policy 5.3 was amended to accommodate unprotectedtransparent marketplaces.

Approved

15-0129 – June 12/15

15-0211 – Sept 18/15

Sept 18/15

5.3 – Client Priority

PolicyAmendments to address the relocation of the Best Execution
obligations to the Dealer Member Rules

Approved

15-0277 – Dec 10, 201517-0137 – July 6/17

Jan 2/18

5.3 – Client Priority

Rule

Amendments to 5.3 (1), (2) and (3) to replace non-client order with
Dealer Related Person order.

Withdrawn

19-0157 – Sept 5/19

21-0009 – Jan 14/21

5.3 – Client Priority

PolicyAmendments to Part 2 and 4 to replace non-client order with Dealer
Related Person order.

Withdrawn

19-0157 – Sept 5/19

21-0009 – Jan 14/21

5.3 – Client Priority

PolicyHousekeeping amendments to correct typographical errors and toensure consistency between the English and the French versions of
the rule .

Approved

6.1 – Entry of Orders to aMarketplace

Rule

Provide that orders at a price of $0.50 or more may only be entered ona marketplace at penny increments and at half-penny increments
below $0.50.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

6.1 – Entry of Orders to aMarketplace

Rule

Provide that orders at a price of $0.50 or more may only be entered ona marketplace at penny increments and at half-penny increments
below $0.50.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

6.1 – Entry of Orders to aMarketplace

Rule

Provide new provisions to prohibit order entries by Participants orAccess Persons in the event of certain short sales.

Approved

11-0075 – Feb. 25/11

12-0078 – Mar. 2/12
12-0158 – May 8/12

Oct. 15/12

6.1 – Entry of Orders to aMarketplace

Rule

Provide new subsection (3) to permit the entry of an intentional crosson a marketplace at a price that is a fraction of a trading increment.

Approved

12-0130 – Apr. 13/12
12-0158 – May 8/12

Oct. 15/12

6.1 – Entry of Orders to aMarketplace

Rule

Add new subsections (7), (8) and (9) to prohibit the entry of an orderby a Participant or an Access Person or the acceptance of an order by
a marketplace unless certain requirements are met. (Renumber thesubsection (3) approved Apr. 13/12 as subsection (6).)

12-0315 – Oct. 25/12

13-0184 - Jul. 4/13

Mar. 1/14

6.1 – Entry of Orders to aMarketplace

PolicyProvide that Basis Orders, Call Market Orders and Volume-Weighted
Average Price Orders may be executed and reported at other than theminimum trading increment for the entry of orders.

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

Approved

Approved

23-0107 – Jul. 27/23

Jul. 27/23

21

UMIR Reference

3

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

6.1 – Entry of Orders to aMarketplace

PolicyReplace Part 1 of Policy 6.1 to provide for the execution and reportingof the execution price of an order at such price increments asestablished by the marketplace provided, that unless otherwise
permitted by the information processor or vendor, the price shall be
rounded to the nearest trading increment, or rounded up to the next
trading increment if the price results in one-half of a trading increment.

Approved

11-0225 – Jul. 29/11

12-0130 – Apr. 13/12
12-0158 – May 8/12

6.1 – Entry of Order to aMarketplace

Rule

Amendments to 6.1(6) to replace non-client order with Dealer Related
Person order.

Withdrawn

19-0157 – Sept 5/19

21-0009 – Jan 14/21

6.2 – Designations
Identifiers

and

Rule

Provide that an order must contain a marker to identify the order as a
“Basis Order”.

Approved

2004-030 – Nov. 26/04

2005-010 – Apr. 8/05

Apr. 8/05

6.2 – Designations
Identifiers

and

Rule

Provide that a “designated trade” or an order entered on a marketplace
to fill an obligation imposed by a Rule or Policy must contain a marker(“bypass marker”).

Approved

2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08 3

6.2 – Designations
Identifiers

and

Rule

Provide that an order must contain a marker to identify the order as a
“Last Sale Price Order”.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

6.2 – Designations
Identifiers

and

Rule

Provide that an order must contain a marker to identify the order as a
“Closing Price Order”.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

6.2 – Designations
Identifiers

and

Rule

Provide that an order must contain a marker to identify the order as a“directed action order’’ as defined in the Trading Rules.

Approved

09-0328 – Nov. 13/09

11-0036 -- Jan. 28/11

Feb. 1/11

6.2 – Designations
Identifiers

and

Rule

Provide that the unique identifier assigned to a Marketplace Eligible
Client is included with each order entered on a marketplace by DealerSponsored Access.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

6.2 – Designations
Identifiers

and

Rule

Repeal the requirement for a “short exempt” marker because of therepeal on the restrictions on the price at which a short sale may be
made.

Approved

2007-017 – Sept. 7/07

11-0075 – Feb. 25/11

6.2 – Designations
Identifiers

and

Rule

Provide for the marking of “short orders” and “short-marking exempt
orders” and repeal provisions related to “short exempt”.

Approved

11-0075 – Feb. 25/11

12-0078 – Mar. 2/12
12-0158 – May 8/12

Oct. 15/12

6.2 – Designations
Identifiers

and

Rule

Amend clause (a) of subsection (1) to require the provision of an
identifier in respect of third-party direct electronic access and routing
arrangements.

12-0315 – Oct. 25/12

13-0184 - Jul. 4/13

Mar. 1/14

Approved

Oct. 15/12

While the effective date of this provision is May 16, 2008, the implementation date is June 1, 2009. Reference should be made to Rules Notice 09-0034 (February 3, 2009).

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

22

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

6.2 – Designations
Identifiers

and

Rule

Amend clause (a) of subsection (1) to require an identifier if the order
requires an identifier under Dealer Member Rule 3200.

Approved

13-0255 – Oct. 15/13
14-0101 – Apr. 24/14

14-0263 – Nov. 13/14

June. 1/15

6.2 – Designations
Identifiers

and

Rule

Add clauses 6.2(1)(b) viii and xviii to includes a derivative-related crossand a bundled order respectively. Also to amend 6.2(6)(a) to exclude a
by-pass cross that is not part of a designated trade.

Approved

16-0123 – June 9/16

17-0039 – Feb 16/17

Sept 14/17

6.2 – Designations
Identifiers

and

Rule

Amend clause 6.2 (1) to required additional client identifiers in the formof legal entity identifiers or account numbers and unique identifiers forforeign dealer equivalents whose clients automatically orders on apredetermined basis.

Approved

18-0122 – June 28/18

19-0071 – Apr. 18/19

Oct. 18/20

6.2 – Designation
Identifiers

and

Rule

Amend 6.2 (1) to replace non-client order with Dealer Related Personorder.

Withdrawn

19-0157 – Sept. 5/19

21-009 – Jan 14/21

6.2 – Designation
Identifiers

and

Rule

Housekeeping amendments to align with the final IIROC rules.

Approved

20-0042 – Mar 5/20

Mar. 5/20

6.2 – Designation
Identifiers

and

Rule

Housekeeping amendments to align with the final IIROC rules

Approved

21-0236 – Dec16/21

Dec. 16/21

6.2 – Designation
Identifiers

and

Rule

Amend 6.2 (2) to require designations and identifiers for orders in alisted derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

6.2 – Designation
Identifiers

and

Rule

Replace reference to “IIROC” with “Corporation” following theamalgamation of IIROC and the MFDA into New SRO.

Approved

25-304- May 1/22

25-307 – Nov. 24/22

Jan. 1/23

6.3 – Exposure of Client
OrdersRuleProvide that a client order that is a “Basis Order” is exempt from theorder exposure requirement.

Approved

2004-030 – Nov. 26/04

2005-010 – Apr. 8/05

Apr. 8/05

6.3 – Exposure of Client
OrdersRuleProvide that a client order that is a “Last Sale Price Order” is exempt
from the order exposure requirement. Provide that client orders thatmust be exposed must be entered on a marketplace that displays orderinformation in accordance with Part 7 of National Instrument 21-101.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

6.3 – Exposure of Client
OrdersRuleProvide that a client order that is a “Closing Price Order” is exempt fromthe order exposure requirement. Provide that client orders that must be
exposed must be entered on a marketplace that displays orderinformation in accordance with Part 7 of National Instrument 21-101.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

6.3 – Exposure of Client
OrdersRule

Clarify that client orders must be entered for display on a marketplacethat displays orders.

Approved

11-0225 – Jul. 29/11

12-0130 – Apr. 13/12
12-0158 – May 8/12

Oct. 15/12

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

23

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

12-0131 – Apr. 13/12
15-0023 – Jan. 29/15

17-0146 – July 13/17

EffectiveDate

6.3 – Exposure of Client
OrdersRule

Delete and substitute clause 6.3(1)(g) to introduce an anti-avoidance
provision to the “Order Exposure Rule” to limit the ability of a small
client order to be executed on a foreign organized regulated market
unless the order had been entered on a market that displays orderinformation (and the order is either displayed or executed on entry) or
executed at a better price.

Withdrawn

6.3 – Exposure of Client
Orders

PolicyHousekeeping to French rules only for translation consistency.

Approved

6.3 – Exposure of Client
OrdersRule

Amend 6.3(2) to replace non-client order with Dealer Related Personorder.

Withdrawn

19-0157 Sept. 5/19

21-0009 - Jan 14/21

6.3 – Exposure of Client
Orders

PolicyAmend Part 1 to replace non-client order with Dealer Related Person
order

Withdrawn

19-0157 Sept. 5/19

21-0009 – Jan 14/21

6.4 – Trades to be on aMarketplace

Rule

Clarify that a security that has been suspended for failure to meet listingor quotation requirements or in respect of which trading has been
delayed or halted for technical reasons may be traded “offmarketplace” if there is not another marketplace on which such security
is traded or quoted.

Approved

2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

6.4 – Trades to be on aMarketplace

Rule

Clarify the “markets” on which a trade may be executed outside of
Canada (defined as a “foreign organized regulated market”).

Approved

2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

6.4 – Trades to be on aMarketplace

Rule

Provide for a renumbering of the provision and clarify, in furtherance ofthe order protection rule, that the exemption is unavailable to an orderof a Canadian account denominated in Canadian funds in certain
cases.

Approved

09-0328 – Nov. 13/09

11-0036 -- Jan. 28/11

Feb. 1/11

6.4 – Trades to be on aMarketplace

Rule

Delete and substitute clauses 6.4(1)(g) and (h) and amend clause (i) toreplace provisions that permitted or required reports to a marketplaceof trades executed off-market either outside of Canada or duringcertain non-regulatory halts, delays or suspension with an ability tomake such reports to IIROC.

Withdrawn

12-0131 – Apr. 13/12

6.4 – Trades to be on aMarketplace

Rule

Housekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec 9/13

Dec. 9/13

6.4 – Trades to be on aMarketplace

PolicyClarify the application of the requirements: outside of marketplace
hours; to foreign affiliates; non-Canadian accounts; to the reporting of
foreign trades. Confirm that certain provisions of UMIR apply to anorder that is not entered on a marketplace.

Approved

2008-008 – May 16/08

May 16/08

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

13 - 0294 - Dec 9/13

2005-012 – Apr. 29/05

Dec. 9/13

24

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

Status

Effective
Date

Request forComments

Amendment Approval/ Withdrawal

09-0328 – Nov. 13/09

11-0036 -- Jan. 28/11

Feb. 1/11

13 - 0294 - Dec 9/13

Dec. 9/13

6.4 – Trades to be on aMarketplace

PolicyProvide for the mechanics of foreign currency translation of the trade
price on a foreign organized regulated market.

Approved

6.4 – Trades to be on aMarketplace

PolicyAmend Part 6 for a consequential revision related to the dark antiavoidance provision and add Parts 7 and 8 to enable reports to amarketplace of trades executed off-market either outside of Canada or
during certain non-regulatory halts, delays or suspension to be madeto IIROC.

Withdrawn

6.4 – Trades to be on aMarketplace

PolicyHousekeeping to French rules only for translation consistency.

Approved

6.4 – Trades to be on aMarketplace

PolicyAmendments to address the relocation of Best Execution obligations
from UMIR to the Dealer Member Rules

Approved

15-0277 – Dec 10/15

17-0137 – July 6/17

Jan. 2/18

6.4 – Trades to be on aMarketplace

Rule

Amended to add Acceptable Foreign Trade Reporting Facility as an
exemption when the trade is greater than 50 standard trading units orfor more than 100000.00 or a contingent order related to a derivativetransaction.

Approved

16-0082 – Apr. 21/16

18-0154 – Aug. 9/18

Nov. 7/18

6.4 – Trades to be on aMarketplace

PolicyHousekeeping amendments to align with the final IIROC rules

Approved

20-0042 – Mar 5/20

Mar. 5/20

6.4 – Trades to be on aMarketplace

Rule

Provide an exemption to allow Participants to trade off-marketplace forsecurities that are subject to a statutory resale restriction.

Approved

22-0054 – Apr. 14/22

22-0185 – Dec 1/22

Mar. 1/23

6.4 – Trades to be on aMarketplace

PolicyReplace references to “IIROC” with “Corporation” following theamalgamation of IIROC and the MFDA into New SRO.

Approved

25-304- May 1/22

25-307 – Nov. 24/22

Jan. 1/23

6.4 – Trades to be on aMarketplace

PolicyHousekeeping amendments to correct typographical errors and toensure consistency between the English and the French versions of
the rule .

Approved

23-0107 – Jul. 27/23

Jul. 27/23

6.5–
Minimum
Size
Requirements of Certain
Orders Entered on aMarketplace

Rule

Add a new section to Part 6 to provide for the prohibition of the entry ofa purchase or sale order unless it meets certain minimum size
requirements.

Approved

11-0225 – Jul. 29/11

12-0130 – Apr. 13/12
12-0158 – May 8/12

Oct. 15/12

6.6 – Provision of Price
Improvement by a Dark
Order

Rule

Add a new section to Part 6 to permit execution of a purchase or saleorder against a Dark Order in the event of the provision of priceimprovement.

Approved

11-0225 – Jul. 29/11

12-0130 – Apr. 13/12
12-0158 – May 8/12

Oct. 15/12

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

12-0131 – Apr. 13/12
15-0023 – Jan. 29/15(re: Part 6)25

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

6.6 – Dark Order Price
Improvement
Obligations
when trading against an
Odd-Lot Order

Rule

Provides that Dark Orders are not required to give price improvement
to odd-lot orders.

Approved

15-0045 – Feb. 12/15

15-0168 – July 30/15

July 30/15

6.6 - Provision of Price
Improvement by a Dark
Order

Rule

Amended to require that an order for less than 30000.00 execute at abetter price when trading against a dark order.

Approved

18-0231 – Dec. 13/18

19-0134 – Aug. 8/19

Feb. 4/20

7.1 – Trading Supervision

Rule

Clarify that the trading supervision obligation applies on the“acceptance” of an order irrespective of the method that was used totransmit that order to the Participant.

Approved

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

2005-011 – Apr. 1/05

Apr. 1/05

7.1 – Trading Supervision

Rule

Provide that each ATS must adopt written policies and procedures tomonitor orders entered by a subscriber who is an Access Person.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

7.1 – Trading Supervision

Rule

Provide a prohibition against the marking by a Participant or Access
Person of a directed action order unless the Participant or Access
Person has established, maintained, and ensured compliance with,written policies and procedures reasonably designed to prevent tradethroughs other than those permitted under Part 6 of the Trading Rules.

Approved

09-0328 – Nov. 13/09

11-0036 -- Jan. 28/11

Feb. 1/11

7.1 – Trading Supervision

Rule

Amend section 7.1 to add subsections (6), (7), (8), (9) and (10) to
expand the existing supervisory requirements for trading to specifically
include the establishment and maintenance of risk management andsupervisory controls, policies and procedures related to access to one
or more marketplaces and/or the use of an automated order systemand to permit, in certain circumstances, a Participant to authorize an
investment dealer to perform on its behalf the setting or adjustment ofa risk management or supervisory control, policy or procedure by awritten agreement.

Approved

12-0200 – Jun. 28/12

12-0363 – Dec. 7/12

Mar. 1/13

7.1 – Trading Supervision

RuleHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec 9/13

Dec. 9/13

7.1 – Trading Supervision

PolicyExpand the trading supervision policy to clarify the obligations ofParticipants with respect to complying market integrity rules in handlingclient orders including specific procedures respecting manipulative anddeceptive activities and reporting and gatekeeper obligations.

Approved

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

2005-011 – Apr. 1/05

Apr. 1/05

7.1 – Trading Supervision

PolicyClarify the obligation of a Participant to have a process in place toobtain “best execution” which allows the Participant to evaluate
whether “best execution” was obtained.

Approved

2007-008 – Apr. 20/07

08-0039 – July 18/08

Sept. 12/08

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

26

UMIR Reference

Rule/
Policy7.1 – Trading Supervision

Rules/Market Integrity Notice
Summary of Amendment

Status

PolicyProvide requirement for compliance procedures applicable toalternative trading systems.

7.1 – Trading Supervision

Policy7.1 – Trading Supervision

Effective
Date

Request forComments

Amendment Approval/ Withdrawal

Withdrawn

2007-008 – Apr. 20/07

12-0315 – Oct. 25/12

Provide for the adoption of policies and procedures which must takeaccount of the factors in Policy 5.2 and may take into account otheradditional factors which are reasonable and of particular importance tothe business conducted by the Participant.

Approved

2008-009 – May 16/08

09-0107 – Apr. 17/09

May 16/08

PolicyRepeal specific provisions respecting the “Best Price” Obligation andprovide for the adoption of policies and procedures by a Participant orAccess Person to prevent an order marked as a directed action orderresulting in a trade-through.

Approved

08-0163 – Oct. 27/08
09-0328 – Nov. 13/09

11-0036 -- Jan. 28/11

Feb. 1/11

7.1 – Trading Supervision

PolicyMake consequential amendments to Parts 1, 2 and 3 of, and add Parts
7 and 8 to, Policy 7.1 as a result of the expansion in Rule 7.1 of theexisting supervisory requirements for trading to specifically include theestablishment and maintenance of risk management and supervisory
controls, policies and procedures related to access to one or moremarketplaces and/or the use of an automated order system and topermit, in certain circumstances, a Participant to authorize an
investment dealer to perform on its behalf the setting or adjustment ofa risk management or supervisory control, policy or procedure by awritten agreement.

Approved

12-0200 – Jun. 28/12

12-0363 – Dec. 7/12

Mar. 1/13

7.1 – Trading Supervision

PolicyMake consequential amendments to Parts 1 and 2 of, and add Part 9
to, Policy 7.1 to govern the implementation of the provision of thirdparty direct electronic access and routing arrangements.

Approved

12-0315 – Oct. 25/12

13-0184 - Jul 4/13

Mar. 1/14

7.1 – Trading Supervision

PolicyHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec 9/13

Dec. 9/13

7.1 – Trading Supervision

PolicyConsequential amendments to address the relocation of the Best
Execution Obligations to the Dealer Member Rules

Approved

17-0189 – Sept 28/17

Mar. 27/18

7.1 - Trading Supervision

PolicyHousekeeping to add references to DMR 3300

Approved

18-0118 – June 21/18

June 21/18

7.1 – Trading Supervision

PolicyAmend Part 4 to replace non-client order with Dealer Related Person
order

Withdrawn

7.1 – Trading Supervision

PolicyHousekeeping amendments to Parts 3 and 4 to align with the final
IIROC rules

Approved

7.1 – Trading Supervision

PolicyExtend certain requirements on Participants’ supervisory systems andpolicies and procedures under Parts 1, 2, 3 and 5 of Policy 7.1 to the
trading of listed derivatives.

Approved

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

15-0277 – Dec. 10/15

19-0157 – Sept 5/19

20-0202 – Oct. 8/20

21-0009 – Jan 14/21
20-0042 – Mar 5/20

Mar. 5/20

22-0140 – Sept. 15/22

Dec. 14/22

27

UMIR Reference

Rule/
Policy7.1 – Trading Supervision

Rules/Market Integrity Notice
Summary of Amendment

Status

PolicyExtend requirements for trading supervision related to electronic
access under Part 7 to the trading of listed derivatives.

7.1 – Trading Supervision

Policy7.1 – Trading Supervision

Effective
Date

Request forComments

Amendment Approval/ Withdrawal

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

Amend Parts 3 and 10 of Policy 7.1 to ensure the supervision systemsof Participants that trade in listed derivatives include the regular review
of compliance with respect to audit trail requirements and record
retention requirements.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

PolicyReplace references to “IIROC” with “Corporation” following theamalgamation of IIROC and the MFDA into New SRO.

Approved

25-304- May 1/22

25-307 – Nov. 24/22

Jan. 1/23

7.2 – Proficiency Obligations

Rule

Provide training
Representative.

or

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

7.2 – Proficiency Obligations

Rule

Extend proficiency requirements to the trading of derivatives on amarketplace.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

7.3 – Liability for Bids, Offers
and Trades

Rule

Require Participants to be responsible for bids and offers entered on aderivatives exchange.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

7.4 – Contract Record andOfficial Transaction Record

Rule

Expand the ambit of the provision to include “orders” as well as trades.

Approved

2002-014 - Sept. 30/02

2004-005 – Jan. 30/04

Jan. 30/04

7.4 – Contract Record andOfficial Transaction Record

Rule

Extend requirement in UMIR 7.4 to derivatives so that the electronic
records provided by a derivatives exchange would be the officialtransaction record for determining the best ask price, best bid priceand last sale price for that listed derivative.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

7.5 – Recorded Prices

PolicyProvide a specific mechanism for the reporting in Canadian currencyinternal crosses and intentional crosses that have been negotiated in aforeign currency.

Approved

2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

7.5 – Recorded Prices

PolicyHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec 9/13

Dec. 9/13

7.7 – Trading During Certain
Securities Transactions

Rule

Introduce a market stabilization provision that provides a number of
additional exemptions for highly-liquid securities, securities exemption
under Regulation M of US securities legislation and Exchange-tradedfunds and redefines the maximum permitted stabilization price topermit purchases at a price not exceeding the last independent sale.

Approved

2003-018 – Aug. 29/03
2004-024 - Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

7.7 – Trading During Certain
Securities Transactions

Rule

Amend the price restrictions to refer to: “best independent bid price”
rather than “last independent sale price”; “Exempt Exchange-tradedFund” rather than “Exchange-traded Fund”; and “marketplace or
foreign organized regulated market” rather than “market”.

Approved

2008-005 – Mar. 21/08

10-0006 – Jan. 8/10

Jan. 8/10

requirements

for

each

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

Access

Person28

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

Status

Effective
Date

Request forComments

Amendment Approval/ Withdrawal

10-0113 – Apr. 23/10

11-0251 – Aug. 26/11

Aug. 26/11

13 - 0294 - Dec. 9/13

Dec. 9/13

7.7 – Trading During Certain
Securities Transactions

Rule

Repeal and replace subsection (7) to reflect the introduction ofMarketplace Trading Obligations.

Approved

7.7 – Trading During Certain
Securities Transactions

Rule

Housekeeping to French rules only for translation consistency.

Approved

7.7 – Trading During Certain
Securities Transactions

PolicyProvide additional guidance on the interpretation of exemptions
provided including covering of short positions, acceptable research
activities and trades pursuant to Market Maker Obligations. Confirm
that activities permitted for market stabilization are nonetheless subject
to rules on manipulative and deceptive activity.

Approved

2003-018 – Aug. 29/03
2004-024 - Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

7.7 – Trading During Certain
Securities Transactions

PolicyAmend Part 3 and Part 5 to reflect the introduction of Marketplace
Trading Obligations.

Approved

10-0113 – Apr. 23/10

11-0251 – Aug. 26/11

Aug. 26/11

7.7 – Trading During Certain
Securities Transactions

PolicyHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

7.8 – Restriction on Trading
Duringa
Securities
Exchange Take-over Bid

Rule

Repeal the provisions related to a securities exchange take-over bid.
Expand the ambit of the provision to cover transactions that have asimilar “economic impact” as a securities exchange take-over bid(including issuer bids, amalgamations, arrangements where securities
of one issuer are offered as part of the consideration for the transaction)and incorporate in Rule 7.7.

Approved

2003-018 – Aug. 29/03
2004-024 - Sept. 10/04

2005-007 – Mar. 4/05

May 9/05

7.8 – Trading in Listed or
Quoted Securities by a
Derivatives Market Maker

Rule

Renumber the previous Rule 7.9 as Rule 7.8.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

7.9 – Provisions Respecting
Dealer-Sponsored Access toMarketplaces

Rule

Provide requirements that a Participant must meet regarding the grantof Dealer-Sponsored Access information to be provided to the Market
Regulator.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

7.9 – Trading in Listed or
Quoted Securities by a
Derivatives Market Maker

Rule

Extend the requirement on Derivatives Market Makers to comply with
Marketplace Rules to the trading of listed derivatives.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

Dec. 14/22

29

UMIR Reference
7.10 –
TradesExtended

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

Effective
Date

FailedRuleProvide a requirement to report a “failed trade” if the reason for failure
has not been resolved within 10 trading days following the original
settlement date of the trade. (Originally proposed as Rule 7.11).

Approved

2007-017 – Sept. 7/07

08-0143 – Oct. 15/08

7.10 – Agreement between aMarket Regulator and an
Access Person

Rule

Provide that an Access Person must enter into an agreement with aMarket Regulator for each Designated Marketplace.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

7.10 – Agreement between aMarket Regulator and an
Access Person

PolicyPrescribed form of agreement to be entered into between an Access
Person and a Market Regulator for each Designated Marketplace.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

7.11–
Variation
Cancellation of Trades

and

Rule

Require notice be given to a Market Regulator if, after execution, a
trade is varied (with respect to price, volume or settlement date) orcancelled. (Originally proposed as Rule 7.12)

Approved

2007-017 – Sept. 7/07

08-0143 – Oct. 15/08

Oct. 14/08 5

7.11–
Variation
Cancellation of Trades

and

Rule

Amend section 7.11 to clarify the circumstances under which a trade
may be cancelled, varied or corrected with notice to, or the consent of,a Market Regulator.

Approved

12-0200 – Jun. 28/12

12-0363 – Dec. 7/12

Mar. 1/13

7.12 – Inability to Rely on
Marketplace Functionality

Rule

Provide a prohibition against entering an order on a marketplace if a
Participant or Access Person knows or ought reasonably to know thatthe handling of the order by the marketplace and its trading systems
may result in the display or execution of an order not in compliance withapplicable UMIR Requirements.

Approved

11-0225 – Jul. 29/11

12-0130 – Apr. 13/12
12-0158 – May 8/12

Oct. 15/12

7.13 – Direct
AccessandArrangements

Electronic
Routing

Rule

Set out provisions governing a Participant providing direct electronic
access or in a “routing arrangement” with an investment dealer or
foreign dealer equivalent.

12-0315 – Oct. 25/12

13-0184 - Jul. 4/13

Mar. 1/14

7.13 – Direct
AccessandArrangements

Electronic
Routing

Rule

Amend 7.13(6) to require that the name of any client not eligible toreceive an LEI be provided to IIROC

18-0122 – June 28/18

19-0071 Apr. 18/19

Oct 18/20

Approved
Approved

Oct. 14/08 4

4

While the effective date of this provision is October 14, 2008, the implementation date was deferred. On February 25, 2011, IIROC gave notice that the implementation date for the reporting of certain
Extended Failed Trades that settle through the continuous settlement facilities of CDS Clearing and Depository Services Inc. would be June 1, 2011. Reference should be made to Rules Notice 110080 (February 25, 2011) and Rules Notice 11-0161 (May 19, 2011).

5

While the effective date of this provision is October 14, 2008, the implementation date was deferred. On February 25, 2011, IIROC gave notice that the implementation date for the filing of a Trade
Variation or Cancellation Report would be June 1, 2011. Reference should be made to Rules Notice 11-0079 (February 25, 2011) and Rules Notice 11-0160 (May 19, 2011).

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

30

UMIR Reference

6

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

EffectiveDate

7.14 6 – Direct Electronic
AccessRule

Set out requirements for a Participant providing “direct electronic
access”.

Withdrawn

12-0315 – Oct. 25/12

13-0184 - Jul. 4/13

Mar. 1/14

7.14 Position limits for listed
derivatives

Rule

Require Participants to comply with position limits set by a derivatives
exchange and to provide New SRO with the ability to modify position
limits set by a derivatives exchange.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

8.1 – Client Principal Trading

Rule

Provide that a principal order or non-client order that executes against
a client order need not be done at a better price if the client order has
been entered “anonymously”.

Approved

2002-015 - Sept. 30/02

2003-024 – Oct. 31/03

Oct. 31/03

8.1 – Client-Principal Trading

Rule

Provide that a Participant is exempt from providing price improvement
if a principal order or non-client order executes with a client order thatis a “Basis Order”.

Approved

2004-030 – Nov. 26/04

2005-010 – Apr. 8/05

Apr. 8/05

8.1 – Client-Principal Trading

Rule

Provide that a Participant is exempt from providing price improvement
if a principal order or non-client order executes with a client order thatis a “Last Sale Price Order”.

Withdrawn

2005-019 – June 10/05

2006-022 – Oct. 31/06

8.1 – Client-Principal Trading

Rule

Provide that a Participant is exempt from providing price improvement
if a principal order or non-client order executes with a client order thatis a “Closing Price Order”.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

8.1 – Client-Principal Trading

Rule

Harmonize the language of the rule to requirements proposed under
Rule 5.1 on “best execution”.

Approved

2007-008 – Apr. 20/07

08-0039 – July 18/08

Sept. 12/08

8.1 – Client Principal Trading

Rule

Amend 8.1(1) to replace non-client order with Dealer Related Personorder.

Withdrawn

19-0157 – Sept 5/19

21-009 – Jan 14/21

8.1 – Client-Principal Trading

PolicyClarify that if a security is traded on more than one marketplace, theclient must receive, when the Participant is buying, a higher price thanthe best bid price, and, if the Participant is selling, the client must pay
a lower price than the best ask price.

Approved

2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

8.1 – Client-Principal Trading

PolicyProvide the factors to be taken into account in determining the “bestavailable price”.

Approved

2007-008 – Apr. 20/07

08-0039 – July 18/08

Sept. 12/08

8.1 – Client-Principal Trading

PolicyHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

8.1 – Client-Principal Trading

PolicyMakes a consequential amendment to the “best available price”
determination, to align with CSA amendments regarding the orderprotection rule.

Withdrawn

14-0124 – May 15/14

Originally proposed as two separate rules, direct electronic access and routing arrangements are covered together in Rule 7.13.

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

31

UMIR Reference

Rule/
Policy8.1 – Client-Principal Trading

Rules/Market Integrity Notice
Summary of Amendment

Status

PolicyPart 3 of Policy 8.1 was amended to accommodate unprotectedtransparent marketplaces such that an employee of a firm is required
to consider all order information “known and available” to that
employee.

8.1 – Client-Principal Trading

Policy8.1 – Client Principal Trading

Effective
Date

Request forComments

Amendment Approval/ Withdrawal

Approved

15-0129 – June 12/15

15-0211 – Sept 18/15

Sept 18/15

Amendments to address the relocation of Best Execution obligations
from UMIR to the Dealer Member Rules

Approved

15-0277 – Dec. 10/15

17-0137 – July 6/17

Jan. 2/18

PolicyAmend Part 2 and 3 to replace non-client with Dealer Related Person

Withdrawn

19-0157 – Sept 5/19

21-0009 – Jan 14/21

8.1 – Client Principal Trading

PolicyHousekeeping amendments to Part 1 to align with the final IIROC rules

Approved

8.1 – Client Principal Trading

PolicyReplace reference to “IIROC” with “Corporation” following theamalgamation of IIROC and the MFDA into New SRO.

Approved

8.1 – Client Principal Trading

PolicyHousekeeping amendments to correct typographical errors and toensure consistency between the English and the French versions of
the rule .

Approved

9.1 - Regulatory Halts,
Delays and Suspensions of
Trading

Rule

Permit orders to be entered to a marketplace during a regulatory halt(though prohibition on order execution would continue).

Approved

9.1 – Regulatory Halts,
Delays and Suspensions of
Trading

Rule

Clarify the “markets” outside of Canada on which a trade may be madeduring a regulatory halt, delay or suspension of trading.

9.1 – Regulatory Halts,
Delays and Suspensions of
Trading

Rule

9.1 – Regulatory Halts,
Delays and Suspensions of
Trading
10.1–
Requirement
10.1–
Requirement

20-0042 – Mar 5/20

Mar. 5/20

25-307 – Nov. 24/22

Jan. 1/23

23-0107 – Jul. 27/23

Jul. 27/23

2004-010 - April 16/04

2004-022 – Aug. 27/04

Aug. 27/04

Approved

2005-012 – Apr. 29/05

2008-008 – May 16/08

May 16/08

Extend the application of UMIR 9.1 to prevent the trading of a listed
derivative while a regulatory halt or suspension is in effect.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

Rule

Provide Participants with the ability to sell securities subject to a cease
trade order on a foreign organized regulated market in a manner thatcomplies with the conditions in the order.

Approved

22-0054 – Apr. 14/22

22-0185 – Dec 1/22

Mar. 1/23

Compliance

Rule

Provide that a Regulated Person shall not, without legal justification,
impede or obstruct the ability of a Market Regulator to conduct aninvestigation or hearing or exercise a power.

Approved

2004-019 – Aug. 13/04

2005-008 – Mar. 11/05

Mar. 11/05

Compliance

Rule

Repeal that portion of the present provisions dealing with interferencewith investigations concurrent with the introduction of Rule 9105 –Obligations of Regulated Persons and Other Persons as part of theConsolidated Enforcement Rule.

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

25-304- May 1/22

32

Rule/
PolicyUMIR Reference

Rules/Market Integrity Notice
Summary of Amendment

Status10.1–
Requirement

Compliance

Rule

Housekeeping to French rules only for translation consistency.

Approved

10.1–
Requirement

Compliance

PolicyProvide guidance on the obligation of the Market Regulator inconnection with monitoring for possible violations of securities
legislation, marketplace rules or requirements of self-regulatory
entities.

Approved

10.1–
Requirement

Compliance

PolicyRepeal that portion of the present provisions dealing with interferencewith investigations concurrent with the introduction of Rule 9105 –Obligations of Regulated Persons and Other Persons as part of theConsolidated Enforcement Rule.

Approved

10.1–
Requirement

Compliance

PolicyHousekeeping to French rules only for translation consistency.

Approved

10.1–
Requirement

Compliance

PolicyReplace reference to “IIROC” with “Corporation” following theamalgamation of IIROC and the MFDA into New SRO.

Approved

10.2 – Investigations

Rule

Provide that a Regulated Person shall respond to a request of a Market
Regulator forthwith “or not later than the date permitted by the Market
Regulator as specified in a written request by the Market Regulator”.
Provide a requirement for a Regulated Person to retain documents for
specified periods if the Market Regulator has served notice of aninvestigation.

10.2 – Investigations

Rule

Request forComments

Amendment Approval/ Withdrawal

Effective
Date

13 - 0294 - Dec. 9/13

Dec. 9/13

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

2005-011 – Apr. 1/05

Apr. 1/05

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

13 - 0294 - Dec. 9/13

Dec. 9/13

25-304- May 1/22

25-307 – Nov. 24/22

Jan. 1/23

Approved

2004-019 – Aug. 13/04

2005-008 – Mar. 11/05

Mar. 11/05

Repeal the present provisions concurrent with the introduction of Rule
8102 – Conducting Investigations as part of the Consolidated
Enforcement Rule.

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

10.3–
Extension
Responsibility

of

Rule

Provide that an officer or employee of a Participant or Access Personthat engages in conduct that results in the contravention of a
Requirement is liable for the conduct.

Approved

2002-014 - Sept. 30/02

2004-005 – Jan. 30/04

Jan. 30/04

10.3–
Extension
Responsibility

of

Rule

Repeal the present provisions concurrent with the introduction of Rule1403 – Applicability as part of the Consolidated Enforcement Rule.

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

10.3–
Extension
Responsibility

of

Rule

Housekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

10.4
Extension
Restrictions

of

Rule

Provide that the rule respecting improper orders and trades applies todirectors, officers and employees of Participants, Access Persons andrelated entities.

Approved

2005-011 – Apr. 1/05

Apr. 1/05

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

33

Rule/
PolicyUMIR Reference
10.4
Extension
Restrictions

Rules/Market Integrity Notice
Summary of Amendment

Statusof

RuleHousekeeping to French rules only for translation consistency.

Approved

and

Rule

Repeal the present provisions as they relate to the power of a hearing
panel concurrent with the introduction of Rule 8209 – Sanctions for
Dealer Members as part of the Consolidated Enforcement Rule. Thebalance of the provisions in the rule would be retitled “Suspension or
Restriction of Access”.

Approved

or

Rule

Replace reference to “IIROC” with “Corporation” following theamalgamation of IIROC and the MFDA into New SRO.

10.6 – Exercise of Authority

Rule10.7 – Assessment
Expensesof

10.7 – Assessment
Expenses

10.5–
Remedies

Powers10.5 – Suspension
Restriction of Access

Request forComments

Amendment Approval/ Withdrawal

Effective
Date

13 - 0294 - Dec. 9/13

Dec. 9/13

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

Approved

25-304- May 1/22

25-307 – Nov. 24/22

Jan. 1/23

Repeal the present provisions concurrent with the introduction of Rule
8203 – Hearing as part of the Consolidated Enforcement Rule.

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

Rule

Clarify that the power of the Market Regulator to assess expenses inthe event of a “frivolous” complaint by a Regulated Person is subject tothe requirement of the Market Regulator to “act reasonably” in making
such determination.

Approved

2002-014 - Sept. 30/02

2004-005 – Jan. 30/04

Jan. 30/04

of

Rule

Repeal the present provisions concurrent with the introduction of Rule8214 – Costs as part of the Consolidated Enforcement Rule. Replacewith a provision “Specific Unacceptable Activities” that is based on
current Policy 2.1

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

10.8–
Procedure

Practice

and

Rule

Repeal the present provisions concurrent with the introduction of Rule
8400 – Practice and Procedure as part of the Consolidated
Enforcement Rule.

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

10.8–
Procedure

PracticeandPolicyClarify that a Notice of Hearing does not need to contain a statementthat a party may object to the form of the hearing if the hearing will bean oral hearing and that a Hearing Panel shall be selected upon
acceptance of an Offer of Settlement. Use of the term “defendant” hasbeen deleted.

Approved

2002-014 - Sept. 30/02
2004-013 - April 30/04

2005-002 – Jan. 14/05

Jan. 7/05

10.8–
Procedure

PracticeandPolicyProvide provision for public access to hearings on a basis similar tothat set out in the Statutory Powers Procedure Act (Ontario).

Approved

2002-017 – Sept. 30/02

2004-004 – Jan. 30/04

Jan. 30/04

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

34

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

Effective
Date

10.8
–
Procedure

PracticeandPolicyPermit the Secretary to delegate the responsibilities of the Secretary
under the Policy to another officer, employee or agent of the Market
Regulator. In addition, provide several minor amendments to clarify
that: (1) the disclosure obligation does not extend to documents which
will not be relied on at a hearing; (2) unless precluded by law, a hearing
panel may accept facts set out in a Statement of Allegations if theperson served with Notice of a Hearing fails to respond; (3) if a
Settlement Hearing is held in camera provide that documents andtranscripts will be publicly available only if the settlement is approved;and (4) provisions for quorum of a Hearing Panel.

Approved

2004-013 - April 30/04

2005-002 – Jan. 14/05

Jan. 7/05

10.8–
Procedure

PracticeandPolicyRepeal the definition of document in Policy 10.8 upon adoption of an
expanded definition of the term in Rule 1.1.

Approved

2004-019 – Aug. 13/04

2005-008 – Mar. 11/05

Mar. 11/05

10.8–
Procedure

Practice

and

Rule

Repeal the present provisions concurrent with the introduction of Rule
8400 – Practice and Procedure as part of the Consolidated
Enforcement Rule.

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

10.8–
Procedure

PracticeandPolicyHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

10.9 – Power of Market
Integrity Officials

Rule

Clarify the information that a Market Integrity Official may request inconnection with the exercise of a power under UMIR and provide forthe retention of such information.

Approved

2004-019 – Aug. 13/04

2005-008 – Mar. 11/05

Mar. 11/05

10.9 – Power of Market
Integrity Officials

Rule

Makes consequential amendments to the rule to reflect changes toRule 5.3 to specifically provide the power to order satisfaction of a client
order if a principal order or non-client order has failed to comply withclient priority requirements.

Approved

2006-019 – Oct. 6/06

2007-002 – Feb. 26/07

Mar. 9/07

10.9 – Power of Market
Integrity Officials

Rule

Provide that a Market Integrity Official may cancel a failed trade undercertain circumstances.

Withdrawn

2007-017 – Sept. 7/07

08-0143 – Oct. 15/08

10.9 – Power of Market
Integrity Officials

RuleHousekeeping to French rules only for translation consistency.

Approved

10.9 – Power of Market
Integrity Officials

Rule

Makes a consequential amendment to reflect UMIR changes to alignwith CSA amendments regarding the order protection rule.

Withdrawn

14-0124 – May 15/14

10.9 – Power of Market
Integrity Officials

Rule

Permits a Market Integrity Official to require a Participant or Access
Person to satisfy any order in the disclosed volume if a trade failed tocomply with section 6.4 of the Trading Rules.

Approved

15-0129 – June 12/15

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

13 - 0294 - Dec. 9/13

Dec. 9/13

15-0211 – Sept. 18/15

Sept. 18/15

35

Rule/
PolicyUMIR Reference

Rules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

Effective
Date

10.9 – Power of Market
Integrity Officials

Rule

Amend 10.9(1) to replace non-client order with Dealer Related Personorder.

Withdrawn

19-0157 – Sept 5/19

21-0009 – Jan 14/21

10.9 – Power of Market
Integrity Officials

Rule

Extend certain powers of Market Integrity Officials to the trading oflisted derivatives.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

10.10 – Report of Short
Positions

Rule

Repeal the requirement to prepare and file short position reports.

Withdrawn

2007-017 – Sept. 7/07

11-0075 – Feb. 25/11

10.11
–
Audit
Requirements

Trail

Rule

Extend requirement on Participants to create and maintain records toorders and trades in listed derivatives.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

10.12 – Retention
Inspection of Records

and

Rule

Repeal the present provisions as they relate to inspection concurrent
with the introduction of Rule 8102 – Conducting Investigations as partof the Consolidated Enforcement Rule.

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

16-0122 – June 9/16

Sept 1/16

10.15 – Assignment
Identifiers and Symbols

of

Rule

Provide that each marketplace shall assign a unique symbol for eachsecurity traded and for each Participant provided access to themarketplace.

Approved

2008-004 – Mar. 14/08

09-0191 – June 26/09

June 26/09

10.15 – Assignment
Identifiers and Symbols

of

Rule

Provide that unique identifiers be assigned to Access Persons and as
part of routing arrangements and the provision of direct electronic
access.

12-0315 – Oct. 25/12

13-0184 - Jul. 4/13

Mar. 1/14

10.15 – Assignment
Identifiers and Symbols

of

Rule

To remove the requirements that a unique identifier be assigned by themarketplace for direct electronic access clients.

Approved

18-0122 – June 28/18

19-0071 – Apr. 18/19

Oct. 18/20

10.15 – Assignment
Identifiers and Symbols

of

Rule

Require Exchanges to assign a unique symbol to a listed derivative fortrading purposes.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

10.16
Gatekeeper
Obligations of Directors,
Officers and Employees ofParticipants and Access
Persons

Rule

Provide an obligation of employees of Participants and Access Persons
to report suspected violations to supervisors or compliance and provide
for an obligation to investigate and resolve all such reports.

Approved

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

2005-011 – Apr. 1/05

Apr. 1/05

10.16
Gatekeeper
Obligations of Directors,
Officers and Employees ofParticipants and Access
Persons

Rule

Repeal the obligation of employees of Participants and Access
Persons to report suspected violations of the best price obligation tosupervisors or compliance and renumber the other clauses
accordingly.

Approved

08-0163 – Oct. 27/08
09-0328 – Nov. 13/09

11-0036 -- Jan. 28/11

Feb. 1/11

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

Approved

Dec. 14/22

36

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

Effective
Date

10.16
Gatekeeper
Obligations of Directors,
Officers and Employees ofParticipants and Access
Persons

RuleHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

10.16
Gatekeeper
Obligations of Directors,
Officers and Employees ofParticipants and Access
Persons

RuleHousekeeping amendments to correct typographical errors and toensure consistency between the English and the French versions of
the rule .

Approved

23-0107 – Jul. 27/23

Jul. 27/23

10.16
Gatekeeper
Obligations of Directors,
Officers and Employees ofParticipants and Access
Persons

PolicyProvide guidance on the obligation of a Participant or Access Person
not to ignore “red flags” with respect to possible improper behaviour byclients, employees, officers or directors.

Approved

2005-011 – Apr. 1/05

Apr. 1/05

10.16
Gatekeeper
Obligations of Directors,
Officers and Employees ofParticipants and Access
Persons

PolicyHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

10.16
Gatekeeper
Obligations of Directors,
Officers and Employees ofParticipants and Access
Persons

Rule

Amendments to address the relocation of Best Execution obligations
from UMIR to the Dealer Member Rules

Approved

15-0277 – Dec 10/15

17-0137 – July 6/17

Jan. 2/18

10.16
Gatekeeper
Obligations of Directors,
Officers and Employees ofParticipants and Access
Persons

Rule

Amend 10.9(1) to replace non-client order with Dealer Related Personorder.

Withdrawn

19-0157 – Sept 5/19

21-0009 – Jan 14/21

10.16
Gatekeeper
Obligations of Directors,
Officers and Employees ofParticipants and Access
Persons

RuleHousekeeping amendment to align with the final IIROC rules

Approved

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

2004-003 – Jan. 30/04
2004-017 - Aug. 13/04

20-0042 – Mar 5/20

Mar. 5/20

37

UMIR Reference

Rule/
PolicyRules/Market Integrity Notice
Summary of Amendment

StatusRequest forComments

Amendment Approval/ Withdrawal

Effective
Date

10.16
Gatekeeper
Obligations of Directors,
Officers and Employees ofParticipants and Access
Persons

Rule

Replace reference to “IIROC” with “Corporation” following theamalgamation of IIROC and the MFDA into New SRO.

Approved

25-304- May 1/22

25-307 – Nov. 24/22

10.17–
Gatekeeper
Obligations with Respect toAccess Persons

Rule

Provide that a Designated Marketplace and a Participant that has
provided Dealer-Sponsored Access have an obligation to report to theMarket Regulator non-compliance by an Access Person with theagreement with the Market Regulator or applicable provisions of UMIR.

Withdrawn

2007-009 – Apr. 20/07

12-0315 – Oct. 25/12

10.17–
Gatekeeper
Obligations with Respect toElectronic Trading

Rule

Add section 10.17 to impose specific gatekeeper obligations on a
Participant who has authorized an investment dealer to perform on its
behalf the setting or adjustment of a risk management or supervisory
control, policy or procedure.

Approved

12-0200 – Jun. 28/12

12-0363 – Dec. 7/12

Mar. 1/13

10.18–
Gatekeeper
Obligations with Respect toAccess to Marketplaces

Rule

Add section 10.18 to provide gatekeeper obligations on a marketplacethat provides access to a Participant or Access Person and on a
Participant that provides direct electronic access to a client or to an
investment dealer or foreign dealer equivalent under a routing
arrangement.

12-0315 – Oct. 25/12

13-0184 - Jul. 4/13

Mar. 1/14

10.19 – Reporting limits forlisted derivatives

Rule

Require Participants to file position reports pursuant to the reporting
limits set by a derivatives exchange, and to provide New SRO with theability to modify report limits set by a derivatives exchange.

Approved

20-0202 – Oct. 8/20

22-0140 – Sept. 15/22

Dec. 14/22

11.1 – General Exemptive
ReliefRule

Housekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

11.2 – General Prescriptive
Power

Rule

Housekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

11.4 – Method of Giving
NoticeRuleHousekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

11.5 – Computation of Time

Rule

Housekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

11.8–
Provisions

Transitional

Rule

Repeal the present provisions as spent in connection with theintroduction of the Consolidated Enforcement Rule.

Approved

16-0122 – June 9/16

Sept 1/16

11.8–
Provisions

Transitional

Rule

Housekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

11.9 – Non-Application of
UMIR

Rule

Housekeeping to French rules only for translation consistency.

Approved

13 - 0294 - Dec. 9/13

Dec. 9/13

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

Approved

12-0104 – Mar. 23/12
13-0275 – Nov. 14/13

Jan. 1/23

38

UMIR Reference
11.11 – Status of UMIR and
Policies

Rule/
PolicyRule

Rules/Market Integrity Notice
Summary of Amendment

StatusClarify the inter-play between the provisions of UMIR and the terms of
any regulation services agreement entered into between a Market
Regulator and a marketplace.

Withdrawn

Notes: The amendments listed in the table do not include various amendments to the Universal
Market Integrity Rules approved by the applicable securities regulatory authorities effective June
1, 2008 made in connection with the recognition of the Investment Industry Regulatory Organization(“IIROC”) as a self-regulatory entity and the adoption by IIROC of UMIR as the rules of IIROC
related to the governing of trading activity on those marketplaces that have retained IIROC as theirregulation services provider. These amendments are of an editorial or administrative nature andwere approved by the applicable securities regulatory authorities without public comment. Becauseof the editorial nature of the amendments, certain amendments were made only to the English or
to the French version of UMIR. The amendments to the English version are reproduced below:
The Universal Market Integrity Rules are hereby amended as follows:
1.

Request forComments

Amendment Approval/ Withdrawal

2002-014 - Sept. 30/02

2004-005 - Jan. 30/04

Effective
Date

(i)

in the definition of “Requirements”, deleting the phrase “these Rules” and substituting theword “UMIR”;(j)deleting the definition of “Rules”; and(k)inserting the following definition of “UMIR”:“UMIR” means those Rules adopted by the Investment Industry Regulatory
Organization of Canada and designated by the Investment Industry Regulatory
Organization of Canada as the Universal Market Integrity Rules as amended,
supplemented and in effect from time to time.

2.

Rule 1.1 is amended by:

Rule 1.2 is amended by:(a)in the opening sentence of subsection (1), deleting the phrase “these Rules” andsubstituting the word “UMIR”; and(b)in the opening sentence of subsection (2), deleting the phrase “these Rules” andsubstituting the phrase “UMIR”.

(a)in the opening sentence, deleting the phrase “these Rules” and substituting the word
“UMIR”;(b)in the definition of “bypass order”, deleting the phrase “Rule or” and substituting“provision of UMIR or a”;

3.

Clause (e) of Rule 2.3 is amended by deleting the phrase “the Rules and” and substituting theword “UMIR and the”.

(c)in the definition of “document” deleting the word “photographs” and substituting the word“photograph”;

4.

Clause (h) of subsection (2) of Rule 3.1 is amended by deleting the phrase “Rule or” andsubstituting “provision of UMIR or a”.

(d)in the definition of “Hearing Committee”, deleting the phrase “the Policy made under Rule10.8” and substituting the phrase “Schedule C.1 to the Investment Industry Regulatory
Organization of Canada’s Transition Rule 1 – Hearing Committees and Hearing Panels
Rule”;

5.

Rule 7.1 is amended by:(e)in the definition of “Hearing Panel”, deleting the phrase “the Policy made under Rule10.8” and substituting the phrase “Schedule C.1 to the Investment Industry Regulatory
Organization of Canada’s Transition Rule 1 – Hearing Committees and Hearing Panels
Rule”;

6.

(a)in subsection (1), deleting the phrase “these Rules and” and substituting the word
“UMIR”;(b)in clause (c) of subsection (2), deleting the phrase “these Rules” and substituting theword “UMIR”; and(c)in subsection (4), deleting the phrase “these Rules” and substituting the word “UMIR”.

Rule 7.2 is amended by:(f)in the definition of “Market Integrity Official”, deleting the phrase “these Rules” andsubstituting the word “UMIR”;(a)in clause (a) of subsection (1), deleting the phrase “these Rules” and substituting theword “UMIR”; and(g)in the definition of “Policy”, deleting the phrase “these Rules” and substituting the word
“UMIR”;(b)in subsection (2), deleting the phrase “of these Rules and” and substituting the phrase“provisions of UMIR and such”.

(h)in the definition of “Regulated Person” in clauses (c) and (d), deleting the phrase “theRules” and substituting the word “UMIR”;

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

7.

Rule 7.3 is amended by deleting the phrase “Rules and” and substituting the phrase“provisions of UMIR and the”.
398.

Rule 10.4 is amended by:(a)in clause (a) of subsection (1), deleting the phrase “these Rules” and substituting theword “UMIR”;(b)in clause (b) of subsection (1), deleting the phrase “Rules and” and substituting thephrase “provisions of UMIR and the”;(c)in clause (a) of subsection (2), deleting the phrase “these Rules” and substituting theword “UMIR”;(d)in clause (b) of subsection (2), deleting the phrase “Rules and” and substituting thephrase “provisions of UMIR and the”; and(e)deleting subsection (3) and substituting the following:(3)

9.

If, in the opinion of a Market Regulator, a particular person to whom UMIR
applies, including any particular person to whom UMIR has been extended inaccordance with subsection (1) and (2), has organized their business andaffairs for the purpose of avoiding the application of any provision of UMIR, theMarket Regulator may designate any person involved in such business andaffairs as a person acting in conjunction with the particular person.

Rule 10.6 is repealed and the following substituted:
10.6

(b)

in subsection (2), deleting the word “Rule” and substituting the phrase “provision of
UMIR”; and(c)in subsection (3), deleting the phrase “the Rules” and substituting the phrase “UMIR”.

17. Rule 11.2 is amended by:(a)in subsection (1), deleting the word “Rule” and substituting the phrase “provision of
UMIR”; and(b)in subsection (2), deleting each occurrence of the word “Rule” and substituting the phrase“provision of UMIR”.

18. Rule 11.3 is repealed and the following substituted:
11.3

Any person directly affected by any direction or decision of a Market Integrity
Official or a Market Regulator made in connection with the administration of UMIR
shall request a review of the direction or decision by an executive officer of theMarket Regulator prior to applying to the applicable securities regulatory authority
for a hearing and review or appeal.
19. Rule 11.8 is repealed and the following substituted:
11.8

Exercise of Authority

10. Rule 10.9 is amended by:in clause (b) of subsection (1), deleting the phrase “these Rules” and substituting theword “UMIR”;(b)in clause (d) of subsection (1), deleting the phrase “these Rules” and substituting theword “UMIR”;(c)in clause (h) of subsection (1):

(d)

(i)

deleting the phrase “these Rules” and substituting the word “UMIR”, and(ii)

inserting the word “the” after the phrase “intent of”; andin clause (i) of subsection (1), deleting the phrase “these Rules” and substituting the word
“UMIR”.

11. Rule 10.11 is amended in subsection (4) by deleting the phrase “a Access Person” andsubstituting the phrase “an Access Person”.
12. Rule 10.13 is amended by deleting the phrase “these Rules” and substituting the word “UMIR”.
13. Rule 10.14 is amended by deleting the phrase “these Rules” and substituting the word “UMIR”.
14. Rule 10.16 is amended by deleting in clause (d) of subsection (4) the word “Rule” andsubstituting the phrase “provision of UMIR”.
15. Part 11 of the Rules is amended by deleting the word “Rules” in the title to the Part andsubstituting the word “UMIR”.
16. Rule 11.1 is amended by:(a)in subsection (1), deleting the word “Rule” and substituting the phrase “provision of
UMIR”;

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

Transitional Provisions
Where a marketplace has retained a Market Regulator to be the regulation
services provider for that marketplace in accordance with the Trading Rules, any
disciplinary proceedings commenced:

A Hearing Panel shall make any determination, hold any hearing and make anyorder or interim order required or permitted of a Market Regulator under this Part.
(a)

Review or Appeal of Market Regulator Decisions(a)prior to the date the marketplace retained the Market Regulator shall,subject to the terms of any agreement between the Market Regulator andthe marketplace entered into in accordance with Part 7 of the Trading Rules,
be continued by the marketplace in accordance with the rules, policies,
rulings, decisions or directions of the marketplace in effect and applicableto such disciplinary proceedings; and(b)on or after the date the marketplace retained the Market Regulator in
respect of the breach or failure to comply with any rule, policy, ruling,decision or direction of the marketplace shall be undertaken in accordancewith Part 10 and Schedule C.1 to the Investment Industry Regulatory
Organization of Canada’s Transition Rule 1 – Hearing Committees andHearing Panels Rule - and be subject to the imposition of any penalty or
remedy under Rule 10.5 as if the breach or failure to comply had been abreach or failure to comply with a Marketplace Rule after the date themarketplace retained the Market Regulator to be the regulation services
provider.

20. Rule 11.9 is amended by:(a)deleting the word “Rules” in the title of the Rule and substituting the word “UMIR”; and(b)deleting the phrase “These Rules do” and substituting the phrase “UMIR does”.

21. Rule 11.10 is amended by:(a)inserting in subsection (3) the word “for” after the phrase “Regulated Person”; and(b)deleting in subsection (4) of Rule 11.10 is amended by deleting the phrase “these Rules”
and substituting the word “UMIR”.
40

22. Rule 11.11 is amended by:(a)deleting the word “Rules” in the title of the Rule and substituting the word “UMIR”; and(b)deleting each occurrence of the phrase “these Rules” and substituting the word “UMIR”.

The Policies to Universal Market Integrity Rules are hereby amended as follows:

(i)

(j)

in section 7.4:
(i)deleting in the title to the section the word “Pre-hearing” and substituting the word
“Pre-Hearing”, and(ii)

inserting in subclause (2)(b) the phrase “of this Policy” after the phrase “section 7.5”;

in section 7.7:(i)deleting in the title to subsection (1) the word “Pre-hearing” and substituting theword “Pre-Hearing”, and(ii)

inserting in subsection (2) the phrase “of this Policy” after the phrase “section 7.5”;

1.

Part 2 of Policy 1.1 is amended by deleting the phrase “the Rule” and substituting the word
“UMIR”.

2.

Part 3 of Policy 1.2 is amended by deleting the phrase “and the Rules and” and substituting
the phrase “, UMIR and the”.

(k)inserting in section 7.10 the phrase “of this Policy” after the phrase “section 7.9”;

3.

Policy 7.1 is amended by:(l)inserting in section 8.2 the phrase “of this Policy” after the phrase “section 8.1”;(a)(m) in subsection 8.3(1):in Part 3:(i)deleting the phrase “the Rules” and substituting the phrase “provisions of UMIR”,(i)inserting the phrase “of this Policy” after the phrase “section 8.4”, and(ii)

deleting the phrase “relevant Rule” and substituting the phrase “relevant provisionof UMIR”, and(ii)

deleting in clause (a) the word “intend” and substituting the word “intends”;(iii) deleting the phrase “Rules and Policies” in the heading of the chart and substituting
the phrase “UMIR and Policies”; and
(b)

(n)

in Part 4, deleting the phrases “the Rules” and “the Rule” and substituting the word
“UMIR”.

4.

Part 1 of Policy 8.1 is amended by deleting the phrase “of less” and substituting the phrase“or less”.

5.

Part 1 of Policy 10.1 is amended by deleting each occurrence of the phrase “these Rules” andsubstituting the word “UMIR”.

6.

Policy 10.8 is amended by:(a)inserting in subsection (2) of section 1.4 the phrase “of this Policy” after the phrase“section 8.1(1)”;(b)

inserting in subsection (3) of section 1.5 the word “the” before the word “Secretary”;(c)in section 3.2:
(i)deleting in clause (d) the phrase “upon be” and substituting the phrase “upon by”,

(ii)

deleting in subclause (f)(ii) the phrase “the Rules and” and substituting the phrase“UMIR and the”;(d)deleting in section 3.4 the phrase “of three members”;(e)in section 4.2:
(i)deleting in clause (d) the phrase “upon be” and substituting the phrase “upon by”,

(ii)

deleting in clause (e) the word “notice” and substituting the word “Notice”, andin section 9.4(i)deleting each occurrence of the phrase “the Rules” and substituting the word
“UMIR”,(ii)

inserting the phrase “of this Policy” after the phrase “section 9.1”, and(iii) inserting the phrase “of this Policy” after the phrase “section 9.2”;(o)inserting in clause (b) of section 9.5 the word “the” after the word “providing”;(p)

in section 9.6:(i)inserting in subsection (2) the phrase “of this Policy” after the phrase “section 1.4”,
and

(ii)

deleting in subsection (4) the word “and” at the end of clause (b);(q)

deleting in clause (a) of subsection (2) of section 9.7 the phrase “Rule or” and substituting
the phrase “provision of UMIR or any”; and(r)deleting Part 10 and substituting the following:
Part 10 – Selection of Hearing Panels
10.1

Selection of Hearing Panel
Upon the issuance of a Notice of Hearing or upon acceptance of an Offer ofSettlement, the Secretary shall select a Hearing Panel in accordance with
Schedule C.1 to the Investment Industry Regulatory Organization of
Canada’s Transition Rule 1 – Hearing Committee and Hearing Panels Rule.

(iii) inserting in clause (f) the phrase “of this Policy” after the phrase “section 9.4”;(f)deleting in clause (c) of section 5.4 the word “ever” and substituting the word “every”;(g)deleting in the title to section 7.1 the word “Pre-hearing” and substituting the word “PreHearing”;(h)deleting in the title to section 7.2 the word “Pre-hearing” and substituting the word “PreHearing”;

May 27, 2024 - UNIVERSAL MARKET INTEGRITY RULES – Status of Amendments

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