The Canadian Securities Administrators has published an implementation schedule for the new rule requiring markets to try and prevent trade throughs.

The Order Protection Rule (OPR), contained in National Instrument 23-101 Trading Rules, was published in final form in January, and will come into force on February 1, 2011.

Between now and then, markets will have to make changes to their operations and develop technology to comply with the rule requiring them to have policies and procedures that are reasonably designed to prevent trade throughs.

In order to facilitate that rule’s implementation, CSA staff and the Trade-through Implementation Committee (comprised of dealers, markets and vendors) have developed deadlines for marketplaces to meet from now until February 2011, outlining the steps that will be necessary to bring themselves in compliance with the new rule, and it is asking markets to report on their progress throughout the coming year.

“We encourage marketplaces to consider whether they should publicly disclose information related to their progress of OPR implementation,” it says. Adding that it will also be asking all marketplaces, marketplace participants and vendors to participate in an industry-wide test, slated for next January, that will test the proper functioning of systems in an OPR environment. A notice providing details about the proposed test will be issued in the coming months.

In the meantime, the first deadline set out by the CSA is Feb. 28, by then it’s expected that marketplaces will have identified OPR implementation issues and solutions. The building and testing of those solutions is expected to take place between April and August. Testing with third parties, including vendors, is to be done by November 30.

IE