How should Canada's investment industry be regulated?

IIROC, MDFA welcome call for feedback from industry professionals, investors, and other stakeholders by the CSA

How should Canada's investment industry be regulated?
Steve Randall

The way that Canada’s investment industry is regulated could be heading for change.

The Canadian Securities Administrators (CSA) said Thursday that it wants feedback from the industry and other stakeholders into how the current framework of the self-regulatory organizations (SROs).

In a consultation paper, the CSA is asking whether the current framework – where investment dealers are required to be members of the Investment Industry Regulatory Organization of Canada (IIROC) and mutual fund dealers (except in Québec) to be members of the Mutual Fund Dealers Association of Canada (MFDA) – is the right one in light of the evolution of the investment industry.

"In publishing this consultation paper, the CSA is looking for broad input on the strengths,  benefits and challenges of the current SRO framework, as well as feedback on the targeted regulatory outcomes set out in our paper," said Louis Morisset, CSA Chair and President and CEO of the Autorité des marchés financiers. "Feedback from all stakeholders is critically important and will be used to identify a proposed policy response and a path forward."

The consultation paper has been welcomed by the SROs who note that the way Canadians want to access investment and other financial services has changed due to the pandemic, suggesting that the regulatory framework should also change.

"The CSA's approach has resulted in a comprehensive and thoughtful paper that clearly identifies many key questions and issues important to Canadians and the industry that serves them in this evolving environment," said IIROC president and CEO Andrew J. Kriegler. 

The consultation will run through to October 23, 2020, and if you want to submit feedback, it should be in writing to the CSA.

“With the CSA consultation process now officially underway we look forward to continuing to work with the CSA towards developing a modern SRO framework for Canada that will benefit all stakeholders,” added MFDA president and CEO Mark Gordon.