Client Relationship Model

Summary of the nature and purpose of the proposed Rules and amendments

The proposed Rules and amendments have been introduced to establish substantive requirements developed under the Client Relationship Model (CRM) Project for the purpose of addressing the following regulatory objectives:

• Relationship disclosure;
• Management and disclosure of conflicts of interest;
• Account suitability; and
• Account performance reporting.

To a degree, the issues identified above may be viewed discretely.  They may also be viewed as key elements of a broader CRM framework and complementary to the fundamental obligation of all dealers and their representatives under National Instrument 31-505 to deal fairly, honestly and in good faith with their clients.

Disclosure of the details of the account relationship and the services to be provided are necessary to better inform the client of the nature of their account relationship. This disclosure, along with account cost and activity reporting will provide clients with important information to use in assessing the performance of investments in their account and whether their objectives and expectations for the account have been satisfied. 

A new Rule has been proposed to clarify IIROC’s position regarding the management of conflicts of interest.  The Rule will require Dealer Members to develop and maintain policies and procedures to identify, disclose and address all real and potential conflicts.

Amendments to the account suitability requirements have been introduced to enhance the level of investor protection for retail clients by ensuring that the suitability of investments in each client’s account is assessed whenever:

• a trade is accepted,
• a recommendation is made,
• securities are transferred or deposited into the account,
• there is a change of representative on the account, or
• there is a material change to the know-your-client information for the account.

Response to comments

Proposed rule changes to address the CRM issues were published by the Investment Dealers Association (IDA) in February, 2008 and subsequently adopted by the IIROC Board in May, 2008.  IIROC staff’s response to the comments received on the proposed amendments has been posted on the IIROC website (IIROC - Policy Proposals).

As noted below, IIROC staff has made several revisions to the proposed CRM Rules and amendments to address comments received.  The revised proposed Rules and amendments, as well as a draft guidance note, have been re-published for comment for a period of 90 days with this Notice.

Description of the proposed Rules and rule-making process

Current IIROC rules address some aspects of the core principles under CRM.  However, there are significant gaps in other respects, such as the requirement to provide relationship disclosure information on account opening and the requirement to provide account performance reporting.  The proposed Rules and amendments are designed to address the gaps that have been identified.

The CRM Project is essentially an extension of the earlier work of the Ontario Securities Commission (OSC) Fair Dealing Model Committee, which released the Fair Dealing Model Concept Paper in January, 2004. This Concept Paper envisioned extensive changes to the regulatory requirements applicable to retail client accounts, from the negotiation and documentation of the relationship at account opening to the transactional information and account reporting to be provided to clients on an ongoing basis.

In September 2004, the Fair Dealing Model initiative was brought under the umbrella of the broader Registration Reform Project (RRP) of the provincial securities commissions.  The aim of RRP is to streamline and harmonize the registration regime and develop rules in certain key areas to apply to all registrants on a national basis.  Under RRP, the Fair Dealing Model initiative was re-branded as the Client Relationship Model and its focus narrowed to the following three areas:

• account opening documentation;
• costs, conflicts and compensation transparency; and
• performance reporting.

Working groups consisting of industry and regulatory staff developed rulemaking recommendations for each of these areas.  A joint rulemaking committee of the IDA and the Mutual Fund Dealers Association (MFDA) then drafted rule proposals in consultation with staff of the securities commissions.  This was followed by an initial dealer review of the proposals by three joint IDA/MFDA industry subcommittees.  Samples of proposed new disclosures were reviewed and commented on by approximately 370 advisors that participated an 11 city broadcast consultation that was held in August, 2006. These initial drafts were also distributed for comment to the IDA Compliance and Legal Section and the IDA Financial Administrators Section in September 2006. Presentations on the contents of these initial drafts were provided to each of the IDA District Councils in October and November 2006.  In response to the comments received on these initial drafts, IDA staff re-drafted its proposals to focus more closely on the core CRM objectives and to factor in potential implementation issues.

As noted above, proposed rule changes to address the CRM issues were published by the IDA in February, 2008 and subsequently adopted by the IIROC Board in May, 2008.  IIROC staff has reviewed the comments received in response to the February, 2008 publication. We have also conducted further consultations with industry associations, the MFDA and the provincial securities regulators.  The proposed Rules and amendments brought forward for consideration with this Notice incorporate feedback received through the comment process and these subsequent consultations.

The proposed Rules and amendments are summarized as follows:

1. Relationship disclosure

IIROC is proposing that every dealer will provide its retail clients with the following information regarding the relationship they are entering into with the client:

• a description of the types of products and services offered by the dealer;
• a description of the account relationship to which the client has consented;
• where applicable, a description of the process used by the Dealer Member to assess investment suitability, including a description of the process used to assess the client’s “know your client” information, a statement as to when account suitability will be reviewed and an indication whether or not the dealer will review suitability in other situations, including market fluctuations;
• a statement indicating Dealer Member and adviser conflicts of interest and stating that future conflicts of interest situations, where not resolved, will be disclosed to the client as they arise;
• a description of all fees, charges and costs associated with operating the account and in making or holding investments in the account; and
• a description of account reporting the client will receive, including a statement indentifying when account statements and trade confirmations will be sent to the client and a description of the Dealer Member’s obligations to provide account performance information and a statement indicating whether or not percentage return information will be sent.

The obligations of Dealer Members to provide certain specific disclosures regarding suitability will vary for order-execution only and managed accounts, in that there is no suitability obligation regarding execution only service and managed accounts must be monitored and supervised according to the specific standards imposed under Rule 1300 and Rule 2500. 

IIROC will not mandate the format of the disclosures, but will require that the information be:

• Provided to the client in writing at the time of account opening;
• Written in plain language; and
• Included in a document entitled “Relationship Disclosure”.

Dealer Members are obligated to provide some of the relationship disclosure information under the current Rules.  The proposed Rule allows for information already provided to clients to essentially be incorporated by reference as long as the relationship disclosure contains a description of this information and the client is specifically referred to the other documents.

2. Conflicts management / disclosure

Rules relating to the management of conflicts of interest are already in place.  To supplement these existing requirements, IIROC is proposing to adopt a general rule to require that where conflict situations cannot be avoided, all such conflicts must be disclosed and addressed in manner that is consistent with the best interests of the client.

3. Account suitability

In addition to the current suitability requirement for trades accepted and recommendations made on retail client accounts, IIROC is proposing that an account suitability review must be performed when certain “trigger” events occur (i.e., transfers/deposits into an account, material change in client circumstances, change in the account representative). It is currently an industry best practice to perform suitability assessments on a periodic basis irrespective of the “trigger” events.

IIROC staff is examining the possibility of introducing further changes to the suitability rule, in addition to the amendments noted above.  Some of these may include consequential amendments to conform the suitability requirements contained in Rule 1300 to the new relationship disclosure requirements.  In particular, the proposed relationship disclosure requirements will require the Dealer Member to advise the client that he or she will be provided with a copy of the “know your client” information collected at account opening and when there are material changes to this information.  The proposed amendments may also lead to changes in the supervisory requirements under Rule 2500.

Staff is also in the process of drafting guidance to Dealer Members on regulatory expectations for meeting their suitability requirements.

4. Account performance reporting

In developing the proposed Rules on performance reporting, issues regarding security position cost disclosure, account activity disclosure and account percentage return disclosure were considered.

1. Security position cost disclosure
   
   IIROC is proposing to mandate that security position cost information be provided to all retail clients at least annually.  When the proposed Rules were published for comment in February, 2008, input was requested as to the preference to require the disclosure of original cost or tax cost.  No clear consensus was reached on this point.  However, as we believe original cost provides the most useful information for the purpose of account performance, we have mandated in the proposed amendments that original cost be disclosed.
2. Account activity disclosure
   
   IIROC is proposing to mandate that account activity information be provided to all retail clients on at least an annual basis. This reporting would require disclosure of the cumulative realized and unrealized capital gains on the client’s account.
3. Account percentage return disclosure
   
   At this time, IIROC is not proposing to mandate that account percentage return information be provided to retail clients.  However, we believe that account percentage return information is important for clients, as it allows for easy comparison of actual account returns to potential returns that might be received from other investments.  Therefore, our intent is to continue to study the cost and implementation issues surrounding percentage return reporting with the objective of requiring that this information be provided to clients as soon as possible.  We will continue to work with IIROC Dealer Member firms in order to understand and address any existing impediments to the provision of this information to retail clients.
   
   As noted above, IIROC is proposing to mandate that dealers disclose to clients at account opening whether they will be provided with percentage return information.  In addition, where Dealer Members choose to provide percentage return information to retail clients, they will be required to calculate account percentage returns in accordance with a method acceptable to IIROC.
   
   IIROC staff will provide guidance as to acceptable percentage return calculation methods.  This will include both dollar-weighted and time-weighted methods.

The proposed Rules and amendments were approved by the IIROC Board of Directors on March 25, 2009.  The text of the proposed Rules and amendments is set out in Attachments 1 through 4. 

Issues and alternatives considered

In the course of working on the CRM project, IIROC staff has consulted extensively with industry participants and the public.  As a result, staff has been presented with a number of different alternatives and perspectives on the issues to be addressed.

Many industry commenters have raised questions regarding value of the proposed changes in light of the potential costs to industry participants.  IIROC staff has continued to receive input on the cost issue throughout the rule-making process and is confident that it is aware of, and has properly considered the issue.  To minimize potential costs, wherever possible, staff has revised the proposal to provide greater flexibility to Members in complying with the new requirements without compromising the investor protection goals of the CRM project. 

In addition, to assist in mitigating the impact of costs, IIROC will provide transition periods to allow Dealer Members sufficient time in the development and implementation of the systems necessary to comply with new requirements.  Before setting any timelines, staff will be consulting with Dealer Members to develop a transition plan for the various aspects of the proposal.

Many industry participants have suggested that the regulatory objectives of CRM should be addressed through broad principles-based requirements alone.  Staff recognizes that there are advantages with principles-based rules, but the need to communicate baseline minimum standards must also be considered.  IIROC staff believes that the proposed Rules and amendments strike an appropriate balance, setting out clear standards while allowing a sufficient degree of flexibility to accommodate differences in Dealer Members’ business models.

Consideration was also given to the suggestion that a standard form boilerplate disclosure document be developed to address the relationship disclosure issue.  However, while staff acknowledges that some aspects of the relationship disclosure information may be common to all Dealer Members, we also expect that there will be a great deal of variation between firms regarding the specific products and services provided and the processes Dealer Members put in place to deliver those products and services.  We believe that the identification of these differences is essential information for clients to make informed choices as to the different options that are available to them.  IIROC staff does not believe that the regulatory objectives of relationship disclosure can be satisfied by simply providing a standard form generic disclosure document that lists products and services that a dealer may or may not offer without differentiating between firms. 

The need for consistency across the various segments of the securities industry was also raised in many comments received by staff.  Some of the inconsistencies in the approach to the CRM issues taken by IIROC, MFDA and the securities commissions may be due to differences in the way business is conducted by the different types of registrants.  In any case, staff has reviewed and revised the proposed changes with a view to ensuring, as much as possible, that there is consistency with the proposed requirements to apply to other industry sectors.  To this end, the relationship disclosure content requirements have been amended and re-organized. 

IIROC staff maintains the position that the relationship disclosure information should function as a foundation document that provides a single reference point for key information on the account relationship.  However, in the interests of avoiding duplication of the information, the proposed Rule has been re-drafted to allow for disclosure provided to clients in other materials to be referenced.  In such cases, the relationship disclosure must contain a description of the information and the client must be specifically referred to the other documents that have been provided.

On the issue of conflicts of interest, staff has made changes to the proposed Rule to clarify that the Dealer Member must “address” rather that “resolve” conflicts and that the Dealer Member must avoid conflicts only if the conflict cannot be addressed in the client’s best interests.

Staff also notes the potential challenges pointed out by industry participants on the issue of performance reporting.  To address the comments we received, the proposed rule regarding activity reporting has been simplified so that Dealer Members will be required only to disclose the cumulative realized and unrealized income and capital gains/losses on the customer’s account.  To provide Dealer Members with greater flexibility, the proposed Rule has also been amended to allow for percentage rates of return, if provided, to be calculated by any method acceptable to IIROC.  The requirement to disclose returns, if reported, on a 1, 3, 5 and 10 year basis has been maintained, but as the requirement will apply on a prospective basis, it is not anticipated that it will create a significant compliance burden on Dealer Members.

Many commenters argued that performance reporting is strictly a service issue and that it should be left up to dealers to decide whether they choose to provide any such reporting to clients.  However, IIROC’s primary mandate is to protect the interests of investors and this responsibility partly involves setting minimum service levels for clients.  IIROC’s position is that it is reasonable to expect that clients receive cost information and account activity reporting that is sufficient to allow them to determine whether they have gained or lost money on the investments in their accounts. 

Again, as noted above, the proposed Rules and amendments will be subject to transition periods to allow for systems changes to be implemented before the amendments become effective.  IIROC staff will be consulting with industry participants before setting timelines. 

We will also be issuing guidance to clarify staff expectations and answer questions on the application of the proposed Rules and amendments.  A preliminary draft guidance note is attached as Attachment 5.  We invite Dealer Members and other interested parties to provide their comments on the draft and, in particular, look for feedback on other areas to be addressed.

Comparison with similar provisions

The CRM-related proposals of the MFDA and the Canadian Securities Administrators (CSA) are summarized below. 

For the purpose of comparison, we have also noted certain provisions set out in the U.K. and U.S. rules regarding account relationship disclosure and performance reporting.  This information has been included to provide some background and context, but is not intended to serve as a comprehensive analysis of international requirements relating to CRM issues.

1. Mutual Fund Dealers Association of Canada

As noted above, IIROC staff has been exchanging information and holding ongoing meetings with staff of the MFDA and the securities commissions with a view to developing harmonized rules to address the CRM issues.   

The revised CRM proposal of the MFDA, is substantially similar to the IIROC proposed Rules and amendments in most respects.  All of the core elements of the CRM project are addressed under both proposals, as are the proposed changes to the suitability requirements. Some noteworthy differences between the two proposals are summarized below:

• The MFDA proposal allows for the required disclosure elements to be disseminated in a variety of documents.  IIROC’s proposed Rule states that where specific information has already been provided to the client by the Dealer Member, the relationship disclosure information can simply include a general description and a reference to the other disclosure materials containing the required information.  The revised IIROC requirement is intended to provide greater flexibility for Dealer Members than the previous IDA proposal which required that clients be provided with a single stand alone relationship disclosure document containing all of the mandatory information.  The new proposed Rule allows Dealer Members to continue to use their existing processes to deliver specific information, such as fee disclosure, but maintains the requirement that clients be provided with a comprehensive user friendly source for at least basic account relationship information.
• Most of the specific relationship disclosure requirements are contained in both the IIROC and MFDA proposals.  There are differences in that the IIROC proposal requires specific disclosure as to whether client accounts will be reviewed at times other that the regulatory minimum (such as in the event of a market disruption) and whether the client will be provided with percentage return information.  The MFDA proposal does not require such disclosure.  IIROC’s position stems from the concern that clients may presume that their accounts are being reviewed by their representatives whenever significant market events occur and that they are entitled to receive percentage return information on statements.  If these services are not to be provided, Dealer Members should advise clients accordingly, so that client expectations are properly managed.
• The MFDA performance reporting proposal does not require individual position cost disclosure, which is required under the IIROC proposal.
• The activity reporting requirements in the IIROC and MFDA proposals are similar in most respects.  However, the MFDA proposes to mandate account activity disclosure for the current year only, while the IIROC proposal will require cumulative activity reporting.
• Neither of the IIROC or MFDA amendments propose to mandate percentage return performance reporting. The IIROC proposed Rules and amendments specify that percentage return information, if provided, must set out returns for 1, 3, 5 and 10 year periods.  This is not required in the proposed MFDA rule.

Details of the proposed amended MFDA rules and policies can be accessed at www.mfda.ca.

2. Canadian Securities Administrators

IIROC staff has also participated in the development of National Instrument 31-103, which also addresses elements of the CRM project and in particular, relationship disclosure and conflicts management.  NI 31-103 is intended, in part, to impose requirements similar in effect to the CRM proposals of the SROs on registrants that are not subject to SRO jurisdiction. 

Following our previous publication of the proposed Rules, several commenters pointed out that there are significant differences between the IIROC proposal and the relationship disclosure requirements under proposed National Instrument 31-103.  Staff has been advised that conforming amendments to NI 31-103 on these issues will be introduced at a later date, once the IIROC and MFDA requirements have been finalized.

The current NI 31-103 proposal may be accessed on the Ontario Securities Commission website at www.osc.gov.on.ca.

CSA statement

The CSA is now finalizing the requirements in NI 31-103 and reminds the SROs and their members that once it is in effect all registrants will be required to comply with the principle for relationship disclosure in that instrument.  The principle in the CSA's most current version of NI 31-103 is that all registrants must provide their clients with information a reasonable client would consider important on account opening. The CSA has confirmed to the SROs that their CRM requirements must remain consistent with that finalized principle in NI 31-103.  

The CSA is also developing a principle for performance reporting for the first round of amendments to NI 31-103.  The CSA will expect the SROs to ensure that their requirements for performance reporting are consistent with that principle.

3. United Kingdom

The U.K. Financial Services Authority (“FSA”) also has implemented principles-based rules that address some of the issues raised under CRM. 

The FSA Conduct of Business sourcebook (COBS) sets account relationship related disclosure requirements as follows:

• COBS 2.2 - A firm must provide appropriate information in a comprehensible form to a client about the firm and the types of products (including specific types of investments and investment strategies) and services offered by the dealer and the costs and associated charges relating to these products and services before these products and services are provided. This disclosure may be provided in a standardized format.
• COBS 6.1 – Unless subject to COBS 9.6.5, a firm must provide retail clients the following information (along with other additional information) if relevant:
  1. the name and address and contact details of the firm;
  2. a statement that the firm is authorized and the name of the authorizing body (and the contact information for the authorizing body);
  3. the nature, frequency and timing of reporting to be provided to the client;
  4. disclosure regarding conflicts of interest;
  5. disclosure regarding investments or cash held by the firm for a retail client;
  6. information on costs and account charges;
  7. information on the investor compensation scheme to which the firm belongs.
• COBS 8.1 - Requirement to enter into a written basic agreement with a retail client setting out the rights and obligations of both parties.
• COBS 9.6.5 – A firm that offers “basic advice” on “stakeholder products” must provide clients with the following information:
  1. the name and address of the firm;
  2. a statement as to whether investment products being offered come from one company, a limited number of companies or the capital markets as a whole;
  3. a statement that the service being offered is basic on a limited range of investment products;
  4. a statement that the firm is regulated by the FSA;
  5. a statement disclosing any product provider loans;
  6. a description of the complaint handling process and the circumstances under which a client can refer a matter to the Financial Ombudsman Service;
  7. a description of the circumstances and the extent to the client will be entitled to compensation from the Financial Services Compensation Scheme.

On the issue of performance reporting, the FSA Handbook contains the following requirements:

• COBS 16.3 – Where a retail client has a managed account with a firm, a periodic statement must be provided every six months at a minimum (every three months if the client requests) which must include the following information (as referenced in the Conduct of Business Sourcebook Rule 16 Annex 2R):
  1. market value of each position held;
  2. cash balance at the beginning and end of each reporting period;
  3. the performance of the portfolio during the reporting period;
  4. the fees and charges incurred during the reporting period;
  5. a comparison of the performance during the reporting period to a performance benchmark (if agreed to between the firm and the client);
  6. details of the total amount of dividends, interest and other payments received during the reporting period and details of other relevant corporate actions.

The Conduct of Business Sourcebook can be accessed at FSA Handbook.

The FSA is continuing to look at ways to improve the interaction between consumers and industry participants and is in the process of conducting a Retail Distribution Review aimed at:

• improving the clarity for consumers of the characteristics of different service types and the distinctions between them;
• raising professional standards; and
• reducing the conflicts of interest inherent in remuneration practices and improving transparency of the cost of all advisory services.

The FSA advises that their intent is to publish a consultation paper outlining policy proposals to address to these issues in June 2009.

Information relating to the FSA’s Retail Distribution Review can be accessed at www.fsa.gov.uk.

4. United States

Under the Investment Advisers Act of 1940, a registered adviser that gives personal advice generally is required to supply each prospective advisory client with a copy of part of its registration application (Part II of Form ADV) or a written document, such as a brochure, containing the information required by the form. Additionally, the brochure is to be offered to current clients annually. Part II of Form ADV includes the following:

• the approximate percentage of billings from each type of advisory service itemized in the form;
• the types of compensation arrangements used by the adviser, the fee schedule, and how to obtain a refund or end an advisory contract before its expiration;
• the types of clients of the adviser;
• the categories of investments about which the adviser offers advice;
• methods of security analysis, sources of information, and investment strategies;
• the education and business backgrounds of particular individuals;
• other business activities of the adviser;
• other financial industry activities or affiliations (including registration) of the adviser and related persons;
• participation or interest in client transactions;
• information on the frequency, level, and triggering factors for account reviews and the nature and frequency of reports to clients on their accounts.

On the issue of account opening documentation, the Financial Industry Regulatory Authority (FINRA) has also provided some guidance to their members in the form of a new account application template.  There is no regulatory requirement to use the sample form, or any portion of it.  Rather, the intent of the form is to provide basic plain language examples of what a firm might use to describe client risk profile and issues the client should be aware of when evaluating account performance information.  The form may be accessed at FINRA - Information Notice - 10/21/08.

Effects of proposed Rule on market structure, Dealer Members, non‑members, competition and costs of compliance

The effect of the proposed Rules and amendments will be to improve the quality of information that clients are provided regarding their account relationships and with the performance of investments in their accounts.  Clients will also be better served through more frequent monitoring of their accounts and better conflict management procedures at Dealer Members.

In developing the proposed Rules and amendments, the possibility of performing costs versus benefits analysis work was examined in some detail.  An independent research company was hired to provide recommendations and assist in completing this work.  Meetings involving staff from the IDA, MFDA, OSC, the Investment Funds Institute of Canada, the Investment Industry Association of Canada and representatives from investment dealers and mutual fund dealers were held to discuss the approach to be taken on the cost/benefit analysis.  However, no agreement on the approach was reached.  While the proposed formal cost/benefit analysis was not performed, substantial feedback from industry participants was provided throughout the rule development process in any case.  As such, IIROC staff believes that it is sufficiently informed as to the potential impacts of the proposed Rules and amendments.

It is expected that the systems and cost impacts will be the greatest for the relationship disclosure and performance reporting proposals.  The extent of the impact for relationship disclosure will be influenced by:

1. Relationship disclosure customization – Dealer Members that choose to customize the relationship disclosure to address individual client account details will likely have greater initial and ongoing compliance costs. Greater customization will also lead to more frequent revisions to the relationship disclosure to ensure it properly reflects the specific client situation.
2. Relationship disclosure implementation period for existing accounts - A longer relationship disclosure implementation period for existing accounts will lessen the costs of initial compliance.

The extent of the systems and cost impact for the performance reporting requirements will be influenced by:

1. Report data requirements – Dealer Members will be required to warehouse greater amounts of historical information to produce the reports.
2. Report calculation requirements - Costs will likely increase where a greater number of calculations must be performed to generate the report.

The costs incurred may also differ between Dealer Members as many firms already furnish at least a portion of the information required under the new minimum standards. The effect on a particular Dealer Member can only be precisely determined by performing a firm specific assessment, but may include costs associated with the production of documents (including printing and mailing) and the imposition of new compliance and supervisory requirements.

As previously noted, an appropriately long transition period will be provided to allow Dealer Members time to make necessary systems changes.  IIROC will continue to consult with Dealer Members in developing an implementation schedule.

Apart from the issues described above, it is not expected that there will be other major technological systems impacts on Dealer Members as a result of the proposed Rules and amendments. Further, it is not anticipated that there will be other significant effects on Dealer Members or non-Dealer Members, market structure or competition.

It is believed that the benefits associated with the proposed requirements are significantly greater than the additional costs to Dealer Members.  The proposed Rules and amendments do not impose any burden or constraint on competition or innovation that is not necessary or appropriate in the furtherance of IIROC’s regulatory objectives.  The proposed Rules and amendments do not impose costs or restrictions on the activities of market participants that are disproportionate to the goals of the regulatory objectives sought to be realized. 

The IIROC Board has determined that the proposed Rules and amendments are not contrary to the public interest.

Anticipated effective date and implementation plan

IIROC anticipates that the proposed Rules and amendments will be made effective on a date to be determined by IIROC staff after receiving notification of approval by the requisite provincial securities commissions. 

As noted above, transition periods for some of the requirements under the proposed Rules and amendments will also apply.

Classification of Rules and amendments and filing in other jurisdictions

IIROC has determined that the proposed Rules and amendments are Public Comment Rules and has directed that the proposed Rules and amendments be published for comment.

The proposed Rules and amendments will be filed with each of IIROC’s Recognizing Regulators, in accordance with s.3 of the Joint Rule Review Protocol contained in the IIROC Recognition Order.

Request for public comment

Comments should be made in writing. One copy of each comment letter should be delivered within 90 days of the publication of this notice, addressed to the attention of:

Mark Stechishin
Policy Counsel
Investment Industry Regulatory Organization of Canada
Suite 1600, 121 King Street West
Toronto, Ontario 
M5H 3T9

A second copy should be addressed to the attention of:

Manager of Market Regulation
Ontario Securities Commission
20 Queen Street West
19th Floor, Box 55
Toronto, Ontario 
M5H 3S8
[email protected]

Those submitting comment letters should be aware that a copy of their comment letter will be made publicly available on the IIROC website (www.iiroc.ca under the heading “IIROC Rulebook - Dealer Member Rules - Policy Proposals and Comment Letters Received”).

Attachments

Attachment 1 – Proposed Amendments - New Rule XX00 – Relationship disclosure;

Attachment 2 – Proposed Amendments - New Rule XX00 – Conflicts of interest;

Attachment 3 – Proposed Amendments – Black-line copy of amended Rule 1300.1 – Supervision of accounts;

Attachment 4 – Proposed Amendments – Amended Rule 200.1 – Minimum Records;

Attachment 5 – Draft Guidance Note.