CSA Provide Transitional Relief from Certain Client Focused Reforms for Deferred Sales Charge Products

In recently published  CSA Notice 31-360, the Canadian Securities Administrators (CSA) announced they are granting transitional blanket relief from certain Client Focused Reforms (CFR) in respect of sales of deferred sales charge (DSC) products in connection with mutual fund sales.

As we discussed in a previous blog post, the CSA have adopted amendments to National Instrument 81-105 Mutual Fund Sales Practices  (NI 81-105) to prohibit the payment by fund organizations of upfront sales commission to dealers resulting in the discontinuation of the DSC option that will take effect in all jurisdictions on June 1, 2022. Amendments to National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103), known as the CFR, include enhanced conflict of interest provisions that became effective on June 30, 2021. The remaining CFR provisions are required to be implemented by December 31, 2021.