TSX Market Making Program Guide

TSX Market Making Program Guide Entering the Program TMX Group Page 5 Chapter 2 Entering the Program 2.1 Approval Process A Participating Organization of TSX may apply to become a Market Maker by completing the TSX Market Maker Application. A DEA client accessing TSX through direct electronic access in accordance with National Instrument 23-103 Electronic Trading and Direct Access to Marketplaces is not eligible to apply to become a TSX Market Maker. For an application to be approved, a Participating Organization must demonstrate that it is capable of performing market making activity that is acceptable to the TSX as well as demonstrate that it has sufficient trading desk and operations area support staff. This may include having sufficient technology and system capabilities that will permit it to properly carry out its market making responsibilities. A Participating Organization that has been approved by TSX to act as Market Maker must execute a TSX Market Maker Agreement. 2.2 Assignment of Securities There are two Market Maker assignments available for each corporate security. A Market Maker is never assigned both assignments in respect of a security. ETFs have only one Market Maker assignment. Market Makers for ETFs are typically endorsed by issuers in relation to their Designated Broker agreements. There are several methods for assigning securities to Market Makers: (i) Security specific assignments apply when new security assignments become available. These circumstances include but are not limited to: a new listing, a Market Maker voluntarily relinquishing a security of responsibility, or due to underperformance of a Market Maker(s). Security specific assignments are made through the competitive bidding process described under the “Competitive Bidding Process” section. (ii) Competitive rebalance of assignments may occur from time to time on Market Maker assignments at the discretion of TSX. The purpose of this rebalancing process is to balance the allocation of securities across Market Makers while serving to update performance obligations in accordance with changing market conditions. Note that this process is not necessarily intended to equalize the number of security assignments per firm. Competitive rebalance assignments are made through the same competitive bidding process described under the “Competitive Bidding Process” section.