Regulators and industry leaders discussed the proposed changes to registration reform for prospectus exempt issues at today’s Dialogue with the OSC in Toronto.

In today’s panel, Marsha Gerhart, assistant manager, registrant regulation, compliance and registrant regulation branch of the Ontario Securities Commision, replied to comments from panel mates Murray Taylor, president and CEO of Investors Group, Morley Salmon, chairman of Limited Market Dealers Association of Canada, and Prema Thiele, partner, Borden Ladner Gervais LLP.

The panel discusseion, “Registration Reform: What it means for registrants”, was moderated by the OSC’s David Gilkes, manager, registrant regulation, compliance and registrant regulation branch.

The February publication of proposed National Instrument NI 31-103 Registration Requirements, opened a 120 day window for comment. During that period the OSC was inundated with 272 letters. When it releases its next draft and its reply, the OSC hopes to receive significantly fewer comments. “We knew it was huge” says Gerhart, when the OSC took it on.

It has been 70 years since any reform in the area. Harmonizing policy and practice province to province and modernizing the language of 70-year-old policy was task enough — “no one gets telegrams any more” concedes Gerhart “people don’t even want physical delivery anymore.”

Gerhart hopes to release the OSC reply and amended version early in 2008 if not before the new year. “We haven’t always agreed with the comments but we tried to respond to them,” says Gerhart/ Many of the letters served as “heads-ups for unique situations” so common in the prospectus-exempt field.

While each had concerns, Thiele, Salmon and Taylor recognized the steps taken were long overdue.

Thiele called NI 31-103 “a very positive regulatory development.” Her main concern lies with the prospect of applying the new policy piecemeal across 13 jurisdictions, where anomalies of legislation and idiosyncrasies of administration could undermine the application of a universal definition of “exempt.” Harmonization of provincial regulators is key to the success of the new platform.

Acccording to Taylor, who helped pen the comment letter from Investment Funds Institute of Canada, regulators “have entered at the refinement stage.” He shared his concerns that “qualifications for chief compliance officers” were “too restrictive.” On that point however Gerhart agreed that they had been “over-exuberant” and had made changes to the upcoming draft that took IFIC’s concerns into account. Like Thiele, Taylor felt that “regulatory consistency across jurisdictions” proved the biggest challenge.

Speaking for the Limited Market Dealers, Salmon agreed that it was “a relief that the OSC took the initiative” for a national platform, which Salmon’s organization had been lobbying for. Ontario happens be one of only two provinces, the other being Newfoundland, that have such registration category.