New guidance from the Investment Industry Regulatory Organization of Canada (IIROC) confirms that investment dealers can use electronic signatures with clients.
The industry self-regulatory organization published new guidance today, March 26, which sets out its approach to the use of so-called e-signatures. In that guidance, IIROC indicates firms can decide whether to require “wet,” hard-copy signatures or to allow digital signatures when it comes to client agreements, contracts and consents.
The guidance also makes clear that firms must be consistent and act in good faith when it comes to setting these policies. For example, they can’t decide to accept digital signatures for clients who want to transfer assets into the firm, but require hard copies for transfers out.
The new guidance is effective immediately.
The SRO says its new guidance reflects an effort to enable industry innovation by clarifying that firms can rely on digital signatures — which represents a convenience to many clients and firms, while also reducing dealers’ administrative workloads.
“IIROC recognizes the importance of facilitating innovation and is committed to providing guidance that makes it easier for firms and Canadian investors to make the best use of technology,” said Andrew Kriegler, president and CEO of IIROC, in a statement.
“IIROC’s principles-based rules are designed to give firms the flexibility to choose the form that a signature may take — be it by physically committing pen to paper or the convenience of using an e-signature,” he said.
While IIROC is giving dealers the green light to use e-signatures, the guidance notes that firms must also comply with privacy and provincial e-commerce laws. For instance, it notes that certain documents, such as certain Powers of Attorney, wills or trusts, may still require physical signatures under those laws.