On September 25, 2014, OSC Staff Notice 33-745 Annual Summary Report for Dealers, Advisers and Investment Fund Managers was published (Report). The Report is an overview of the main initiatives undertaken by the OSC’s Compliance and Registrant Regulation Branch within the last year and those initiatives underway, with a focus on those registrants directly overseen by the OSC, i.e., exempt market dealers, portfolio managers, scholarship plan dealers and investment fund managers. The Report identifies certain decisions as they relate to registrant misconduct and also provides information regarding trends in registration and compliance and related guidance to firms.
The Report includes initiatives such as:
- the exempt market review resulting in
- proposed amendments relating to the accredited investor exemption and minimum amount investment prospectus exemption in NI 45-106; and
- the proposal of four new prospectus exemptions;
- the review and industry consultation of a best interest standard for dealers and advisers;
- amendments to NI 31-103 as they relate to cost disclosure, performance reporting and client statements which are being phased in – some of these requirements became effective in July this year;
- an amendment to NI 31-103 as it relates to registrants having an independent dispute resolution service, mandating registrants, except those in Quebec, to apply to the Ombudsman for Banking Services and Investments by August 1st this year;
- the review of service arrangements between portfolio managers and IIROC dealer members
- consultation relating to derivatives regulations resulting in OSC Rule 91-506 Derivatives: Product Determination and OSC Rule 91-507 Trade Repositories and Derivatives Data Reporting, both effective December 31, 2013;
- the Registrant Outreach program which includes providing registrants with educational seminars and increased communications through blast e-mails to registrants, e.g., notifying of new rules coming due and providing guidance to registrants;
- the development of an enhanced review of firms applying for registration akin to a registrant’s first compliance review;
- the issuance of new registration service standards; and
- proposed amendments to NI 31-103 such as time limits on exams, amendments to registration forms and imposing a requirement on CCO’s to have 12 months of relevant securities industry experience at the time of application.