Retail Client Data Submission Project

Purpose

As the Canadian investment industry continues to evolve, it will become increasingly important to remain aware of circumstances, outcomes and issues that affect Canadian investors.

As the national self-regulatory organization that oversees all investment dealers and mutual fund dealers in Canada, we have a unique opportunity to obtain a holistic view into Canadian retail investor holdings and activity. Such data will not only be a key resource as we set out to obtain the Canadian investor profile with the objective to understand, inform, and protect investors, but it will also be very beneficial to Dealer Members to help deliver greater investor value.

Requirements

In early 2027, we will be issuing a mandatory data request to investment dealers and mutual fund dealers to provide detailed information on the investments held by their retail clients as at December 31, 2026. Appendix 1 provides the data specifications.

Dealer Members will submit the data to us in three standardized comma-separated values (.CSV) files using our secure, in-house portal. The deadline to submit the data will be early Spring 2027. More details on the submission process will be provided closer to the date of the submission in 2026.

Consultation process

The data request has been informed by feedback from Dealer Members.

In August 2023, we published Bulletin 23-0114 to invite Dealer Members to participate in consultations and provide their feedback and advice regarding the data to collect and potential challenges with gathering information for this initiative.

As a baseline, we used the data request from the most recent client research project that was conducted by the MFDA1, one of our predecessor organizations, and adjusted it to align with the account and product offerings of our current membership. We distributed confidential drafts of the proposed data request to participating Dealer Members as part of the consultation process. We also engaged in discussions with system service providers to ensure the data collection process for Dealer Members would be efficient. In addition, we provided participating Dealer Members with a demonstration of the secure portal we developed for the data submission.

The Dealer Members we consulted with have a variety of retail product offerings and business models and represent the diversity of our membership. We consulted with Dealer Members in October 2023, January 2024, and September 2024 and invited their system service providers to participate in the consultations.

We sincerely thank participating Dealer Members and their system service providers for their time and valuable contributions.

Key feedback received

We made several changes to the initial data request based on Member feedback. We strived to make changes to minimize the effort required by Dealer Members while ensuring valuable insights remain possible. A summary of the key feedback from the consultation process is outlined below.

Timelines

We initially proposed requesting the data as of December 31, 2024 as outlined in Bulletin 23-0114. In our initial consultations, Dealer Members indicated that they needed additional time not only to implement the necessary processes but also to manage several new regulatory requirements that would require significant operational resources. In response, we informed Dealers Members in July 2024 of our decision to extend the date of the request for detailed information on retail investor holdings by one year, to as at December 31, 2025.

After considering further Member feedback, and in light of all other competing priorities being undertaken, we have decided to extend the timeline by another year. The data request will now be for December 31, 2026, allowing firms additional time to allocate resources effectively and ensure the accuracy and completeness of the submitted data.

Household Data

Several Dealer Members expressed challenges with providing household information. Some indicated that they do not collect this data, while others noted that their definition of household differs from the one originally proposed, which grouped accounts by address. Additionally, Dealer Members indicated that providing this information would require creating a new data field in their systems, involving significant effort.

As a result, we have decided not to collect householding information.

Know-Your-Client (KYC) Data

Some Dealer Members recommended the collection of additional KYC information, including client and account level information, to enhance the usefulness of the dataset.

We have decided not to expand the request for KYC information beyond the client’s year of birth. While we acknowledge the potential value of collecting additional KYC information, we need to ensure a manageable scope for this initial request. To gain investor insights, we will supplement our analysis with publicly available demographic data, such as income and education levels, based on the account’s forward sortation area.

Client Relationship Model Phase 2 (CRM2) Reporting Data

During consultations, some Dealer Members recommended limiting the request for deposit and withdrawal data reported on the annual performance reports to the past 12 months, rather than since account inception, due to the large volume of data involved.

As a result, we have decided to collect the deposit and withdrawal information only for the 12-month period reported on annual performance reports. Data from account inception will not be requested, as the varying opening dates across accounts could hinder our ability to conduct consistent analysis.

Data on Representatives and Branch information on NRD

The original data request included representatives and branch National Registration Database (NRD) information. However, some Dealer Members indicated that they do not store NRD data in the same system as other requested information, making it difficult to compile and submit. As a result, we have decided not to include NRD information in the data request.

Privacy considerations

CIRO has robust and strict data governance, security, retention and acceptable use policies and any data received is managed in strict compliance with these policies. With respect to the data collected under the retail client data submission project:

1. We completed a privacy impact assessment to mitigate the privacy risks resulting from the collection of personal information.
2. We will require Dealer Members to anonymize account numbers prior to submission.
3. To further mitigate privacy risks, the only personal information we will collect is the year of birth of the account holders, and the forward sortation area (i.e. first three letters) of the residential address postal code.
4. We have developed a secure portal application that Dealer Members must use to submit the data. The data is loaded and saved in an isolated, secure database that is not accessible by the external-facing portal application.

Cost-Benefit Analysis

We sought to conduct a cost-benefit analysis to evaluate whether the insights gained from the data would justify the costs of its collection.

We recognize that impact and cost-benefit analyses are valuable tools to assess the feasibility of an initiative. However, we encountered significant challenges in carrying out this assessment which proved difficult to overcome.

1. It is challenging to assign specific values or measurable indicators to enhanced regulatory effectiveness. While we expect this data to be useful across the organization and lead to broader benefits for the industry over time, quantifying these benefits in a way that supports a comprehensive cost-benefit analysis is difficult. Comparing the long-term qualitative impact of effective regulation to the immediate costs and operational burden remains a complex task.
2. We also faced challenges in evaluating the costs associated with this initiative. Dealer Members use a variety of technologies and data storage methods, meaning the ease of extracting the requested data in a standardized format varies across firms. To better understand potential costs, we engaged with major system service providers to explore whether high-level estimates could be made for developing templated solutions to support data extraction. However, they also found it difficult to provide a reasonable estimate due to the varying degrees of customization in the technology solutions used by different clients.

We may be able to better determine the net impact after we conduct the first data request. We will look into the feasibility of doing so after the completion of the first exercise.

Next Steps

Beginning in mid-2026, we will launch a pilot testing phase to help Dealer Members test the data submission process and ensure they can securely and accurately submit data through our in-house portal. This collaborative approach will allow us to refine the process together and address any challenges early on.

Dealer Members with any questions about this project are encouraged to email [email protected]. We welcome any Dealer Members experiencing difficulties with specific data fields to reach out for support.

We appreciate the industry's support on this transformational initiative and recognize the effort involved. Your collaboration will help us build a more data-driven and efficient regulatory framework that benefits both firms and investors.

APPENDIX 1: DATA FILE TEMPLATES AND GUIDELINES

The data file templates are intended to capture, for each retail client account of the Dealer Member as at the reporting date, information regarding the account, each investment position within the account, and representatives assigned to retail client accounts.

Required Files

File Names

There are no specific requirements or naming conventions for file names. We encourage Dealer Members to choose file names that will help them to identify the contents of the files and accurately submit them.

File Contents

To compile the data, Dealer Members will need to use three separate comma-separated values (CSV) files as described in the table below.

The ‘Division’ row in each file specifies the required fields for mutual fund dealers, investment dealers, and dual-registered dealers. Mutual fund dealers are required to compile the data in the columns labelled as “Both” or “MFD Only” in the ‘Division’ row. Investment dealers and dual-registered dealers are required to compile the data in the columns labelled as “Both” or “ID only” in the ‘Division’ row.

The Data Guidelines section specifies the format and additional requirements for each field in the files.

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  See Compliance Bulletin 0846-C for the Mutual Fund Dealers Association – 2021 Client Research Project data request.