Yesterday, the Investment Industry Regulatory Organization of Canada (IIROC) announced the approval of amendments to Dealer Member Rules to adopt core elements of its Client Relationship Model (CRM) Project for investment dealers. Specifically, the amendments provide for(i) improved relationship disclosure, including requiring that investors receive more information on account types and transaction and account fees; (ii) enhanced standards regarding conflicts of interest management and disclosure; (iii) increased suitability assessment standards to ensure that investments are appropriate to investors' objectives and time horizon; and (iv) account performance reporting.
While most of the amendments will come into force over the next two years, the account performance reporting requirements have been deferred until the CSA performance reporting requirement have been finalized. The amendments were last published for comment in January 2011. The approved amendments reflect revisions made to address comments received.
Meanwhile, IIROC also published guidance to assist dealers on compliance with the new requirements, as well as guidance relating to "know your client" and suitability obligations. For more information, see IIROC Notices 12-0107, 12-0108 and 12-0109.
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