Disclosure rules require that companies report all material information about their business and financial affairs to investors in a timely and fair manner. Information must be disseminated as quickly as possible to all audiences at the same time, placing all market participants on the same footing.
One of IIROC's roles is to monitor the timely disclosure of material information by publicly traded companies on marketplaces that have retained IIROC as their regulation services provider. Companies need to notify IIROC prior to the issuance of material news releases as well as supply us with a written copy to review. IIROC will request that companies revise any releases that are unclear or overly promotional. It remains at all times the ultimate responsibility of the company to ensure that it has complied with its obligations under applicable securities legislation and marketplace rules. All significant announcements must be made immediately after a IIROC surveillance officer has reviewed the release.
If necessary, IIROC may determine that trading in any of the company's securities should be temporarily halted pending a news release, to allow the market to properly absorb the information. The mechanism IIROC uses to do so is referred to as a "trading halt". The reactivation of trading is known as a "trade resumption".
Where a company fails to make timely disclosure of material information, the Securities Commissions can resort to the issuance of a Cease Trade Order, which stops the trading of a company stock. Once issued, the order would remain in effect until the company has fulfilled its disclosure obligations.