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CSA proposes changes to registration rules for dealers, advisors and fund managers


Date: Monday, June 28, 2010
Author: Investment Executive

Canadian securities regulators are proposing changes to the registration reform that was adopted last fall.

The Canadian Securities Administrators announced Friday that they are seeking public comment on proposals to amend the registration regime for dealers, advisers and fund managers.

The CSA says that the proposed amendments are the result of its experience with the implementation of the registration reform rules. The proposed amendments are intended to make the registration rules clearer and the on-going requirements more targeted, it says.

The amendments proposed by the CSA include proposals that would:

- add an obligation for registered reps to understand the structure and features of each security they recommend;

- add obligations for investment fund managers to deliver trade confirmations and account statements to investors who deal directly with them, rather than through a dealer;

- propose guidance dealing with complaint handling;

- amend the requirement to ensure independent resolution in cases where a complaint relates to trading or advising activity, a breach of client confidentiality, theft, fraud, misappropriation or forgery, misrepresentation, an undisclosed or prohibited conflict of interest or personal financial dealings with a client;

- address the impact of the coming introduction of International Financial Reporting Standards on the valuation of securities;

- remove certain non harmonized provisions for the mutual fund dealer category; and

- grant additional exemptions to members of self regulatory organizations where the SRO rules adequately cover the same regulatory risks.

“Investors will benefit from the proposed amendments to the registration regime, which includes enhanced requirements for consumer disclosure and handling investor complaints. The proposals also aim to improve the day-to-day operation of the National Registration Rules for both industry and regulators, and thereby will further enhance the efficiency of the new harmonized registration regime,” said Jean St-Gelais, chairman of the CSA and president and CEO of the Autorité des marchés financiers.

The comment period is open until September 30.