Enforcing requirements designed to enhance advisor-client relationships and enabling innovation will be among the Canadian Securities Administrators’ (CSA) top priorities under incoming chair Stan Magidson.
The umbrella group of regulators on Monday released its business plan for the next three years, which placed the launch of a new industry self-regulatory organization as the top priority.
The agenda also featured long-standing promises to introduce a form of binding authority for industry dispute resolution through the Ombudsman for Banking Services and Investments, and for overhauling national systems such as SEDAR.
Magidson, chair of the Alberta Securities Commission, will take over as CSA chair on July 1.
The plan also indicated the CSA will be conducting targeted compliance reviews to test firms’ adherence to the client-focused reforms (CFRs), and that it will be reviewing the mutual fund sales practices rule to determine whether any changes to that rule are needed, given the regulators’ new approach to prioritizing client interests under the CFRs.
According the CSA’s plan, the examination of the sales practices rule will include “reviewing principal distributors’ practices, considering whether amendments are needed to clarify the circumstances in which a principal distributor model should be available and whether such a model remains appropriate in light of the [CFRs].”
At the same time, the CSA indicated that it will be stepping up its efforts to deal with the growing crop of innovative industry business models.
These plans include introducing “cohort-based testing environments which would allow multiple eligible businesses to test novel ideas or solutions based on themes proactively determined by the CSA.”
Additionally, the regulators said they’ll develop approaches for overseeing technology enabled tactics to shape investor behaviour such as gamification and trading prompts driven by artificial intelligence, and continue to develop a regime to regulate cryptoasset trading platforms.
“We will continue to collaborate to deliver on our goals and our mandate to protect investors, promote fair, transparent and efficient markets, reduce burden where possible, and reduce systemic risk,” Magidson said in a release.