The Portfolio Management Association of Canada (PMAC), through its Industry, Regulation & Tax Committee, is pleased to have the opportunity to submit comments regarding CSA Notice and Request for Comment 21-315 Next Steps in Regulation and Transparency of the Fixed Income Market (the “Notice”).
PMAC supports the efforts of the Canadian Securities Administrators (“CSA”) to identify opportunities to improve market transparency and better protect investor interests. We believe many aspects of the CSA staff’s plan to enhance fixed income regulation are positive steps that will address current concerns around access to and transparency of the fixed income market. We are also in favour of increased transparency for transactions in the Canadian corporate bond market as post-trade transparency will enable investors to understand and manage their investments. We also support increased transparency in the primary market for corporate debt securities as this would be a benefit to all participants. While we commend the general regulatory direction to improve bond market transparency, we query why the CSA has excluded government debt from the proposal, which is arguably contrary to the transparency goal itself.
We commend the CSA for moving forward with improvements to SEDAR that were implemented earlier in 2015. We believe these enhancements will benefit investors and provide meaningful information on fixed income offerings. We are also supportive of the CRM 2 requirements around fixed income transactions and believe these will have a significant impact on investors’ understanding of the costs associated with fixed income investments. We believe that commission costs transparency made available in advance of fixed income security transactions would be beneficial for investors. Similarly, the new performance reporting requirements coming into effect in July 2016 will also provide investors with important information about how their fixed income investments have performed over time. These are all positive developments in improving investors’ access to information about fixed income transactions.