"Market regulation - ensuring a fair and well regulated market - is critical to the reputation and credibility of the TSE market," said Barbara Stymiest, President and CEO of the Toronto Stock Exchange. "With demutualization, we recognize that establishing a separate regulation division of the TSE will help to reassure our customers that regulatory services will continue to be provided without conflict of interest and in a fair and unbiased manner."
TSE RS will provide regulation services for the TSE market, as well as alternative trading systems (ATSs) that choose to contract for services. ATSs are expected to commence operations, in Canada, later this year when the Canadian securities commissions introduce a new regulatory regime for ATSs.
The TSE is committed to providing a fair and well-regulated market for investors. The TSE has taken a number of initiatives to promote market integrity, including the development of sophisticated market surveillance systems which helps it to identify unfair trading practices, and introducing policies to improve the quality of disclosure to investors. The establishment of TSE Regulation Services will ensure that the Canadian securities industry continues to provide for effective self-regulation of market conduct in a responsive and neutral manner.
TSE RS will operate on a cost recovery basis and its costs and revenues will be segregated from those of the for-profit arm of TSE Inc. In the near future, Participating Organizations will be charged for regulatory services separately and the revenue for these services will be reported separately. Trading fees will be adjusted to reflect the change and charged separately.
The fully automated Toronto Stock Exchange consistently ranks among the world's top exchanges by market capitalization and trading volume. In 2000, the average daily value of TSE trading has exceeded $3 billion. The TSE provides investors with a well-regulated, fair and accessible marketplace.
