Perimeter Markets Inc.



National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- relief from the requirement that an ATS shall not execute trades in securities other than exchange-traded securities, corporate debt securities, government debt securities, or foreign exchange-traded securities -- National Instrument 21-101 Marketplace Operation.

Applicable Legislative Provisions

National Instrument 21-101 Marketplace Operation, s. 6.3.

July 30, 2012




(the Jurisdiction)








(the Filer)



The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from section 6.3 of NI 21-101 Marketplace Operation (the Exemption Sought).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

(a) the Ontario Securities Commission is the principal regulator for this application, and

(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick, Nova Scotia, Prince Edward Island, and Newfoundland and Labrador.


Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.


This decision is based on the following facts represented by the Filer:

1. The Filer is a corporation formed under the laws of the Province of Ontario and its principal business is to operate an alternative trading system (ATS) as defined in NI 21-101.

2. The head office of the Filer is located in Toronto, Ontario.

3. The Filer is a member of the Investment Industry Regulatory Organization of Canada (IIROC), the Canadian Investor Protection Fund (CIPF) and the Bourse de Montreal and is registered in all provinces as a dealer in the category of investment dealer, as a derivative dealer in Quebec and as a futures commission merchant in Ontario and Manitoba.

4. Bondview and CBID are trademarks of Perimeter.

5. The Perimeter System is an ATS exclusively for trading over-the-counter fixed income securities by Institutional Subscribers (defined in Appendix A).

6. The Filer will be the sole party furnishing access to the Perimeter System in Ontario to Institutional Subscribers.

7. The following non-Canadian debt securities are offered through the Platform:

(a) high-grade and high-yield U.S. corporate bonds;

(b) U.S. government debt securities and debt securities issued by U.S. governmental agencies;

(c) emerging market bonds, which are defined as U.S. dollar or Euro-denominated bonds issued by sovereign entities or corporations domiciled in a developing country, including both high grade and non-investment grade debt; and

(d) European high-grade corporate bonds, which are defined as corporate bonds issued by entities domiciled in Europe (together, Non-Canadian Fixed Income Securities).

8. Institutional Subscribers are responsible for execution, clearing and settlement of trades through the Perimeter System using their customary procedures.

9. Section 6.3 of NI 21-101 provides, in part, that an ATS can only execute trades in corporate debt securities and government debt securities. The definition of corporate debt security only includes debt securities issued in Canada by companies or corporations that are not listed on a recognized exchange or quoted on a recognized quotation and trade reporting system. The definition of government debt security only includes, in part, a debt security issued or guaranteed by the government of Canada, or any province or territory of Canada.

10. The Filer has requested an exemption from section 6.3 of NI 21-101 to be able to offer Non-Canadian Fixed Income Securities to Institutional Subscribers in Ontario.


The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that the Exemption Sought is granted provided that:

1. The Perimeter System is only made available in Canada to Institutional Subscribers; and

2. Dealer participants of the Perimeter System trading with Institutional Subscribers who are not registered as an investment dealer under the securities legislation of a jurisdiction of Canada will rely on and comply with the international dealer registration exemption in section 8.18 of NI 31-103 Registration Requirements.

"Tracey Stern"
Manager, Market Regulation
Ontario Securities Commission


Appendix A

In this order, "Institutional Subscriber" means:

(a) a bank listed in Schedule I or II of the Bank Act (Canada), or an authorized foreign bank listed in Schedule III of that Act;

(b) the Business Development Bank incorporated under the Business Development Bank Act (Canada);

(c) a loan corporation, trust corporation, savings company or loan and investment society registered under the Loan and Trust Corporations Act (Ontario) or under the Trust and Loan Companies Act (Canada);

(d) a co-operative credit society, credit union central, federation of caisses populaires, credit union or league, or regional caisse populaire, or an association under theCooperative Credit Associations Act (Canada), in each case, located in Canada;

(e) a company licensed to do business as an insurance company in a province of Canada;

(f) a subsidiary of any company referred to in paragraph (a), (b), (c), (d) or (e), where the company owns all of the voting shares of the subsidiary;

(g) a person or company registered under the securities legislation of a jurisdiction of Canada as an adviser, investment dealer, mutual fund dealer, or exempt market dealer;

(h) the government of Canada or a jurisdiction of Canada, or any Crown corporation, agency, or wholly-owned entity of the Government of Canada or a jurisdiction of Canada;

(i) any municipality, public board, or commission in Canada;

(j) any national, federal, state, provincial, territorial or municipal government of or in any foreign jurisdiction, or any agency of that government;

(k) a pension fund that is regulated by either the federal Office of the Superintendent of Financial Institutions or a pension commission or similar regulatory authority of a jurisdiction of Canada or a wholly-owned subsidiary of such a pension fund;

(l) a registered charity under theIncome Tax Act (Canada);

(m) a person or company other than an individual or an investment fund that has net assets of at least $25 million as reflected in its most recently prepared financial statements;

(n) a person or company, other than an individual, that is recognized by the Ontario Securities Commission as an "exempt purchaser" or "accredited investor" or, under National Instrument 45-106 as an "accredited investor";

(o) an investment fund if one or both of the following apply:

(i) the fund is managed by a person or company registered as an investment fund manager under the securities legislation of a jurisdiction of Canada;

(ii) the fund is advised by a person or company authorized to act as an adviser under the securities legislation of a jurisdiction of Canada;

(p) an account that is fully managed by a registered portfolio manager or an entity listed in paragraphs (a), (c), (d) or (e);

(q) an entity organized in a foreign jurisdiction that is analogous to any of the entities referred to in paragraphs (a) through (f) and paragraph (k); and

(r) a person or company in respect of which all of the owners of interests, direct or indirect, legal or beneficial, are persons or companies that are Institutional Investors; provided that:

(i) two or more persons who are the joint registered holders of one or more securities of the issuer shall be counted as one beneficial owner of those securities; and

(ii) a corporation, partnership, trust or other entity shall be counted as one beneficial owner of securities of the issuer unless the entity has been created or is being used primarily for the purpose of acquiring or holding securities of the issuer, in which event each beneficial owner of an equity interest in the entity or each beneficiary of the entity, as the case may be, shall be counted as a separate beneficial owner of those securities of the issuer.