Cease Trade Orders

A cease trade order (CTO) is a decision issued by a provincial or territorial securities regulatory authority or similar regulatory body against a company or an individual. Cease Trade Orders (“Orders”) are issued for reasons such as failing to meet disclosure requirements or as a result of an enforcement action that involves an investigation of potential wrongdoing.

The purpose of the CTO Database is twofold: provide stakeholders with a publicly searchable database containing all Orders issued by participating CSA members, regardless of whether their effect is temporary or indefinite, and disseminate such Orders to its subscribers. 

There are two categories of Orders:  

  • Orders that ban trading in securities of a reporting issuer or a non-reporting issuer, regardless of whether the Order resulted from a continuous disclosure default, an enforcement action or other, and;
  • Orders that ban trading by certain individuals and/or companies, regardless of whether the Order resulted from a continuous disclosure default of the issuer (such as a management cease trade order), an enforcement action or other. 

Some Orders may fall under both categories, in which circumstance, they will appear in both categories.

This categorization is intended as a tool to simplify the classification of Orders and enhance search results. However, it remains the obligation of users to conduct the necessary due diligence before trading to determine whether or not a specific trade can be executed. As such, we cannot overstate the importance of reading all decisions to fully understand their scope.

Who issues cease trade orders and why?

Securities regulatory authorities have sole authority to issue CTOs. The securities regulatory authorities oversee securities regulation in their respective provinces or territories and require publicly traded companies to disclose material information to the public within delays set by regulation. For example, publicly traded companies must file copies of quarterly and annual financial statements and management's discussion and analysis (MD&A) with provincial and territorial securities regulatory authorities, and must also send this information to shareholders, on request. Companies must also disclose material events or developments - such as takeover bids and merger and acquisitions, which may affect the value of the company's shares. When a company fails to do so, a CTO banning trading in the securities of the company or banning certain individuals and/or companies from trading in securities of the company may be issued.

Securities regulatory authorities are also tasked with enforcing the securities legislation in their province or territory. For instance, during the course of an investigation into potential wrongdoing, the securities regulators may issue or ask a tribunal to issue a temporary order banning trading by individuals or companies, or banning the trading in the securities of a company.

Securities regulators can also impose or ask a tribunal to impose sanctions following the conclusion of a proceeding against respondents, which includes orders that ban trading by individuals or companies, or orders that ban trading in the securities of a company, either permanently or for a defined period of time.

Presently, all equity and fixed income marketplaces in Canada have retained the Investment Industry Regulatory Organization of Canada (IIROC) as their regulation services provider. Under the rules adopted by IIROC, if a securities regulator issues a CTO with respect to an issuer whose securities are traded on a marketplace, IIROC imposes a regulatory halt on trading of those securities on all marketplaces for which IIROC acts as a the regulatory services provider. Such action is taken whether or not the CSA regulator that issued the CTO is the principal regulator of the issuer. Once the halt is imposed by IIROC, no person subject to these rules may trade those securities on any marketplace in Canada, over-the counter or on a foreign organized regulated market. The Montreal Exchange regulates and oversees the options market. When a CTO is issued, the Montreal Exchange and IIROC coordinate their decisions to halt trading of securities and options on these marketplaces simultaneously.

How do I find cease trade orders?

You can find information about cease trade orders by searching the Cease Trade Order database. By default, all searches will show all cease trade orders issued that remain outstanding (active). To view cease trade orders that have been revoked or have expired (inactive), use Advanced Search and check the inactive box. You can also browse by company name.

Helpful hint for searching the CTO database:

  • To get the best results when searching for a specific name, only input the company name (don’t include “Inc.”, “Co.”, etc.) or only input the last name of the individual.

As of July 1, 2015 certain orders made in other provinces or territories will automatically take effect in Alberta. For more information click here.

How will I know the status of a CTO?

A CTO's status will be listed as either 'Issued', 'Amended', ‘Expired’ or 'Revoked': 

    Issued: means that an Order to ban trading has been rendered.
    Amended: means that the original Order has been modified.
    Expired: means that the Order has lapsed.
    Revoked
    : means that the Order has been lifted.

As of July 1, 2015 certain orders made in other provinces or territories will automatically take effect in Alberta. For more information click here.

It remains the obligation of users to conduct the necessary due diligence before trading to determine whether or not a specific trade can be executed. As such, we cannot overstate the importance of understanding the applicable securities legislation and reading all decisions to fully understand their scope.

How long does a CTO last?

A CTO may be issued with a specific expiry date (temporary CTO) or for an indefinite period of time (“None” will be indicated under expiry date). When a CTO is issued, it will remain in effect until either its expiry date is reached or, if there is no expiry date, until the company corrects the deficiencies which caused the CTO to be issued. The deficiencies that need to be remedied are explained in the Order.

It is the company’s responsibility to comply with securities law. Once a CTO is issued, it is up to the company, and not Securities Regulators, to correct the deficiencies and apply to have the CTO revoked.

What do I do if I own shares in a company that has a cease trade order (CTO) issued against it?

You may want to contact the company directly to find out how it is addressing the CTO. Company contact information is available on the company’s profile on the System for Electronic Document Analysis and Retrieval at SEDAR.

From the SEDAR homepage:

    - click "Company Profiles" in the top navigation bar
    - under “Public Company”, choose the first letter of the company’s name
    - scroll down the list and click on the company name

If you are unable to reach the company, you may contact the Securities Regulator who issued the CTO for more information. If multiple CTOs are issued against the same company, contact the company’s Principal Regulator. This information is also available under the company’s profile on SEDAR. Follow this link to access the contact information for all Securities Regulators in Canada.

Please note that if “Yes” is indicated under the column “Exception”, trading will be permitted under certain specific conditions. Consult the order for more information on these conditions or, consult the jurisdiction which issued the CTO to see if these conditions apply to your situation.

If there are no exceptions applicable to your situation, you have two options:

  1. Hold onto your shares in case the CTO is revoked; or
  2. Consider claiming a capital loss on your income taxes.

We suggest you contact the Canada Revenue Agency for more information on this second option.

Coverage by Jurisdiction

Securities Regulators are responsible to update the Cease Trade Order Databases. Coverage for cease trade orders banning trading in securities of issuers as a result of a continuous disclosure default begins on the date indicated in the respective table below.

Jurisdiction

Active CTOs

Inactive CTOs

Alberta

1974***

2004***

British Columbia

1972

2004

Manitoba

1999

2004

New Brunswick

2006

2006

Newfoundland and Labrador

Participating*

Participating*

Northwest Territories

2004

2004

Nova Scotia

2005

2005

Nunavut

Not participating

Not participating

Ontario

1971

2004

Prince Edward Island

Not participating

Not participating

Quebec

1971

2004

Saskatchewan

1980

Not participating

Yukon

Not participating

Not participating

Coverage for cease trade orders banning trading in securities of issuers as a result of an enforcement action that involves an investigation of potential wrongdoing and banning trading by certain individuals and companies begins on the date indicated in the respective table below.

Jurisdiction

Active CTOs

Inactive CTOs

Alberta

1998***

2004***

British Columbia

1981

2004

Manitoba

2006

2006

New Brunswick

2005

2005

Newfoundland and Labrador

2005

2005

Northwest Territories

2005

2005

Nova Scotia

2002

2005

Nunavut

Not participating

Not participating

Ontario

1995

2004/2005**

Prince Edward Island

Not participating

Not participating

Quebec

1994

2004

Saskatchewan

1984

Not participating

Yukon

Not participating

Not participating

* participating, but no CTOs in this category as of June 30, 2006
** Enforcement CTO as of January 2004 / Management CTO as of April 2005
*** As of July 1, 2015, certain orders made in other provinces or territories will automatically take effect in Alberta. Alberta will not issue separate orders in these circumstances (see additional information below).

Automatic Reciprocation in Alberta of cease trade orders issued by other securities regulatory authorities in Canada

Effective July 1, 2015, the Government of Alberta has proclaimed into force amendments to the Securities Act (Alberta), which included the creation of section 198.1. Among other things, as a result of section 198.1 of the Securities Act (Alberta), when another securities regulatory authority in Canada issues an order against a person or company, it will automatically apply in Alberta. If that order is varied, amended or revoked by a securities regulatory authority in Canada, the variation, amendment or revocation will also apply in Alberta. The Alberta Securities Commission will not issue a separate cease trade order or variation, amendment or revocation of the cease trade order in these circumstances. As a result, the absence of an Alberta order against a particular company or person on the National CTO Database, does not mean that trading for that particular company or person is not restricted in Alberta.

Subscription Information

You can subscribe to the National CTO Database to receive automatic email alerts when securities regulators add new content to the database. After you subscribe, you’ll also be able to login to view CUSIP numbers for some companies. 

To subscribe, email your contact information to the CSA Secretariat. You can contact the CSA Secretariat for further information at (514) 864-9510.

About CUSIP data

The CTO Database uses the CUSIP number as a security identifier. These numbers are assigned to securities trading in Canada and the United States. Other securities identifiers, such as SEDOL (which identifies securities trading in the United Kingdom) and ISIN (international security identifier which is formed by adding CA in front of the CUSIP number), are not available through the CTO Database. 

The CUSIP number is nine characters long. The first six characters identify the issuer, the seventh and eighth characters identify the type of security and the last digit is used as a check digit. The CTO Database only provides (when available) the first six digits of the CUSIP. 

The CUSIP numbers are automatically retrieved from a list provided by S&P Capital IQ. However, in some instances, when the company name is uploaded to the CTO Database it does not exactly match the company name on the S&P Capital IQ list. In these instances, no CUSIP number will be available through the CTO Database. Also, no CUSIP number will be assigned to Orders that ban trading by certain individuals and/or companies. It remains the obligation of users to conduct the necessary due diligence to determine whether or not a specific trade can be executed. As such, we emphasize the importance of reading all decisions to fully understand their scope. 

CUSIP data is proprietary to CUSIP Global Services, managed on behalf of the American Bankers Association by S&P Capital IQ. To download a complete list of CTOs which includes CUSIP numbers, you must have a license agreement directly with Standard & Poor's. If you are licensed to use CUSIPs, please contact the CSA Secretariat. They will enable your account so that you can download a complete list of CTOs and CUSIP numbers when you are logged into the CTO database. 

If you don't have a license to use CUSIPs, after you have subscribed you can still download up to 200 cease trade order records with CUSIPs at a time without a fee. This is an auditable process, and the CSA may track your access and provide Standard & Poor's CUSIP Service Bureau with a history of your downloading activities.

General Information

For further information regarding the cease trade order database, you can contact the CSA Secretariat at (514) 864-2280