The Competition Bureau has been cleared to progress an ongoing investigation into Broadridge Software Limited and its affiliates following the issuance of court orders.
The investigation focuses on whether the company has violated the Competition Act’s merger and restrictive trade practices provisions. In particular, the bureau aims to determine if Broadridge has or is presently engaged in anti-competitive practices related to book of record platforms in Canada – such as practices that could hinder competitors’ complementary software products for broker-dealers.
Moreover, the Competition Bureau is evaluating whether Broadridge’s acquisition of Kyndryl Canada Limited’s Securities Industry Services business on November 1 could significantly limit competition. The bureau has been given a year to challenge the transaction.
SIS operates as a book-of-record platform. Books of record are customer ledgers that monitor securities transactions and investment assets. These central repositories of information are key to the operations of many banks and broker-dealers.
In addition to SIS, Broadridge and its affiliates own the Dataphile and BPSC book of record platforms via Broadridge Financial Solutions (Canada) Corp., as well as the RPM book of record platform via Broadridge RPM Technologies Corporation.
In its review, the bureau will consider factors such as the level of economic concentration in the industry, the merging parties’ market shares, and the conditions of and barriers to entry into the market. To date, no conclusion of wrongdoing has been reached in Broadridge’s case.
The Competition Bureau has asked market participants like book of record platform users, platform competitors, and complementary software providers to provide input to assist the bureau in assessing whether Broadridge’s conduct and the SIS acquisition have violated the law. The bureau offered assurance that information received would remain confidential, except in certain cases, and would be evaluated stringently.
Broadridge is a provider of wealth management and capital markets technology services, catering to Canadian broker-dealers.