News Release

IFIC Makes Submission to the CSA on SRO Framework Consultation

A single SRO would significantly improve the investor experience

October 23, 2020 (Toronto) – The Investment Funds Institute of Canada (IFIC) today made its submission to the Canadian Securities Administrators (CSA) on CSA Consultation Paper 25-402 – Consultation on the Self-Regulatory Organization (SRO) Framework.

IFIC prefaced its submission by reiterating the industry’s strong support for the self-regulatory model and by underlining the importance of the ‘self’ in self-regulation. “IFIC’s views on this consultation are anchored in the belief that there is significant value in the SRO model of regulation,” said Paul Bourque, President and CEO, IFIC. “Self-regulation provides cost-effective dealer regulation and investor protection, and it works well for the benefit of governments, investors and the industry.”

IFIC also voiced the industry’s support for a SRO created by the consolidation of the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA). The resulting new entity would require a reconstituted board and senior management, and it would incorporate the best dealer compliance and enforcement processes and programs from both IIROC and the MFDA.

“The public interest must be the ultimate objective of this consultation, and we believe that a single SRO that regulates all retail-facing investment dealer and mutual fund dealer firms and their representatives would better achieve this objective by reducing investor confusion, enhancing the investor experience and improving investor outcomes,” added Bourque.

For investors to achieve the benefits of a new single SRO, it must be structured in a way that achieves the following outcomes:

• Small independent mutual fund dealer and investment dealer registrants should continue to be viable to safeguard access to investment advice for modest clients and for clients in small or remote communities;
• Mutual fund dealers that want to keep their existing business models should be able to do so without any unnecessary increase in their current regulatory burden or SRO membership fees;
• Advisors should be able to transition seamlessly to offering a broader array of products and/or services to their clients; and
• A single SRO should employ a risk-based approach to the regulation of all investment products in a consistent and predictable manner.

About IFIC

The Investment Funds Institute of Canada is the voice of Canada’s investment funds industry. IFIC brings together 150 organizations, including fund managers, distributors and industry service organizations, to foster a strong, stable investment sector where investors can realize their financial goals. By connecting Canada’s savers to Canada’s economy, our industry contributes significantly to Canadian economic growth and job creation.

For more information:

Pira Kumarasamy
Senior Manager, Communications and Public Affairs
pkumarasamy@ific.ca
416-309-2317