The CSA didn’t land the place it began. Again in January 2025, the regulator proposed matching the SEC’s cap at CAD $0.0010 per share, with out adjusting for the alternate charge. That drew 10 remark letters from a number of the greatest names in Canadian capital markets – BMO Capital Markets, TD Securities, Scotiabank, Nationwide Financial institution Monetary Inc., TMX Group Restricted, Nasdaq Canada, Tradelogiq Markets Inc., Virtu Monetary, the Funding Trade Affiliation of Canada, and Canadian Impartial Finance and Innovation Counsel Inc.
The suggestions was removed from unanimous. 5 respondents backed the unique $0.0010 proposal. One most popular $0.0025. One other needed to maintain the prevailing $0.0030 cap, although they mentioned they might dwell with $0.0017 if pressed. Two known as for scrapping charge caps altogether in favour of letting the market kind it out. And one argued for dropping the excellence between inter-listed and non-inter-listed securities solely, which might successfully imply a $0.0017 cap throughout the board.
A selected concern for 2 respondents was the prospect of order movement heading south. They cautioned that decrease Canadian charge caps might push traders and merchants towards U.S. venues, the place marketplaces can supply greater rebates. That, they mentioned, might result in decreased order movement in Canada – not precisely the end result regulators had been hoping for.
Three commenters argued that having a harmonized charge cap for all securities in Canada would scale back market charge complexity, although they disagreed on the applicable degree – some supporting CAD $0.0010 for all securities, whereas others backed CAD $0.0017 for all securities.
In the long run, the CSA settled on $0.0017, reasoning that it nonetheless represents a significant discount from $0.0030 whereas higher reflecting the Canadian greenback equal of the SEC’s USD $0.0010 cap – roughly CAD $0.0014 at present alternate charges. The marginally greater quantity additionally provides Canadian marketplaces extra room to compete on charges with out operating afoul of the cap.
