Securities regulators are seeking feedback from industry firms on issues that arise as they implement the client-focused reforms (CFRs).
The reforms, which aim to ensure that firms put their clients’ interests before their own, include changes to conflict of interest requirements, disclosure obligations and KYC/KYP rules. The CFRs must be fully adopted by the end of 2021.
The Canadian Securities Administrators (CSA), the Investment Industry Regulatory Organization of Canada (IIROC ) and the Mutual Fund Dealers Association of Canada (MFDA) have established a CFRs Implementation Committee to consider operational challenges experienced by the industry as the reforms are put into practice.
Industry firms and various professionals that provide services to the industry, such as law firms and consultants, are invited to provide the regulators with input through an online form on the CSA’s website.
The regulators indicate that these responses will be used to develop industry guidance on implementation issues.
“All comments will be carefully considered,” the CSA said. “Our goal is to provide…additional guidance about operational issues shared by industry stakeholders.”
In response to industry requests, the CSA has delayed the implementation of certain reforms due to the disruption caused by the Covid-19 outbreak.
As a result, the deadline for compliance with the CFRs’ conflict of interest provisions has been delayed six months to June 30, 2021, and the deadline for complying with the relationship disclosure rules was pushed to the end of 2021.
In the meantime, the CSA said that “even though the implementation has been delayed, registrants are encouraged to consider the reforms with every interaction they now have with their clients.”
It’s also expected that IIROC and the MFDA will harmonize their rules with the CSA’s reforms.