Canadian securities regulators have finalized their rules that overhaul the registration system and extend the passport system to registrants, in an effort to streamline and harmonize the current, complicated regime.

The Canadian Securities Administrators Friday published the final version of sweeping new rules that will, among other things, rationalize both firm and individual registration categories, change the trigger for registration, introduce permanent registration, and impose new regulatory obligations on a wider swath of industry players (most notably investment fund managers, exempt market dealers and compliance officers).

The CSA says that the new regime, which has been in the works since 2005, introduces higher proficiency standards for some registrants, and enhances rules for consumer disclosure, referral arrangements, complaint handling, and the disclosure and management of conflicts of interest. The regulators also expect that the new regime will reduce the regulatory burden on some players by increasing the system’s overall efficiency.

“We have moved to harmonize, streamline and modernize the registration requirements and procedures across Canada,” said Jean St-Gelais, chair of the CSA and president & CEO of the Autorité des marchés financiers, in a release. “The new registration regime is more flexible and easier to use, enhances investor protection and benefits industry by bringing increased efficiencies to the registration system.”

The new rules — National Instrument 31-103 Registration Requirements and Exemptions and related rules and amendments — will come into force on September 28, at which time they will apply to aspiring new registrants.

At the same time, the regulators will be adopting the passport system for registration in all provinces except Ontario (although it has built interfaces between Ontario and the passport provinces). Existing registrants will have up to two years to transition to the new regime.

“With the extension of passport to dealers and advisers, the passport system will be fully implemented,” added St-Gelais. “This final phase of passport will give market participants faster and simpler access to the Canadian capital markets and will benefit investors in all provinces and territories.”

IE