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Self-Regulatory Organizations (SROs)

A Self-Regulatory Organization (SRO) is a non-government entity that represents registrants who are members of the organization and is responsible for regulating the operations, standards of practice, and business conduct of its members and their representatives in order to protect investors and public interest.

The Securities Act provides FCNB with the power to recognize SROs. Following are the two SROs currently recognized by FCNB.

Mutual Fund Dealers Association (MFDA)

Governance

Oversight Review Report 

Oversight Review Report of the Mutual Fund Dealers Association of Canada 4 July 2018

Oversight Review Report 

Oversight Review Report of the Mutual Fund Dealers Association of Canada 15 September 2017.

Oversight Review Report 

Oversight Review Report of the Mutual Fund Dealers Association of Canada 18 November 2016

Oversight Review Report 

Oversight Review Report of the Mutual Fund Dealers Association of Canada 15 April 2013

Instruments in Force

Recognition Order 

Variation and Restatement of Recognition Order of the MFDA on 1 April 2021

Recognition Order 

Variation and Restatement of Recognition Order of the MFDA on 12 April 2018

Recognition Order 

Variation and Restatement of Recognition Order of the MFDA on 17 November 2014

Recognition Order 

Recognition Order of the MFDA as a SRO in New Brunswick on 28 November 2008

Terms of Recognition

Terms and Conditions of Recognition of the MFDA as a SRO for Mutual Fun Dealers on 28 November 2008

Memorandum of Understanding

Memorandum of Understanding Regarding the Oversight of the MFDA among the Recognizing Regulators on 1 April 2021

Memorandum of Understanding

Memorandum of Understanding Regarding the Oversight of the MFDA among the Recognizing Regulators on 2 October 2013

Investment Industry Regulatory Organization of Canada (IIROC)

Governance

Oversight Review Report Oversight Review Report of the Investment Industry Regulatory Organization of Canada 5 August 2020
Oversight Review Report Oversight Review Report of the Investment Industry Regulatory Organization of Canada 18 April 2019
Oversight Review Report  Oversight Review Report of the Investment Industry Regulatory Organization of Canada 26 April 2018
Oversight Review Report  Oversight Review Report of the Investment Industry Regulatory Organization of Canada
4 July 2017
Oversight Review Report Oversight Review Report of the Investment Industry Regulatory Organization of Canada
3 March 2016
Oversight Review Report  Oversight Review Report of the Investment Industry Regulatory Organization of Canada
4 December 2014

Orders and Decisions

Order Order In the Matter of the Securities Act, S.N.B. 2004, c. S-5.5 [as amended] (act) and in the matter of the Investment Industry Regulatory Organization of Canada.
1 May 2015
Order Order In the Matter of Investment Industry Regulatory Organization of Canada – ss. 208(1) of the Securities Act – Proposed Distribution by IIROC of Funds Paid to It by Deutsche Bank Securities Ltd.
8 April 2013
Order Order In the Matter of Investment Industry Regulatory Organization of Canada – ss. 208(1) of the Securities Act – Proposed Distribution by IIROC of Funds Paid to It by Three Member Firms
8 March 2013
Order (Repealed) Order In the Matter of Investment Industry Regulatory Organization of Canada – ss. 208(1) of the Securities Act – Proposed Distribution by IIROC of Funds Paid to It by Three Member Firms
30 March 2012

Instruments in Force

Recognition Order  Variation and Restatement of Recognition Order of IIROC on 1 April 2021
Recognition Order  Variation and Restatement of Recognition Order of IIROC on 12 April 2018
Recognition Order  Variation and Restatement of Recognition Order of IIROC on 7 June 2010
Recognition Order  Recognition of IIROC as a SRO in New Brunswick on 1 June 2008
Memorandum of Understanding Memorandum of Understanding Regarding the Oversight of IIROC among the Recognizing Regulators on 1 April 2021
Memorandum of Understanding Memorandum of Understanding Regarding the Oversight of IIROC among the Recognizing Regulators on 1 June 2008

Compensation and contingency funds of a self-regulatory organization

The Securities Act provides FCNB with the power to enter into an agreement, memorandum of understanding, or arrangement that relates to the compensation and contingency fund of a self-regulatory organization.

Following are the two investor protection funds currently recognized by FCNB.

Canadian Investor Protection Fund

The Canadian Investor Protection Fund (CIPF) is the only compensation fund approved by the Canadian Securities Administrators (CSA) for investment dealers regulated by the Investment Industry Regulatory Organization of Canada (IIROC). CIPF is funded by IIROC-regulated Dealer Members and all IIROC Dealer Members.    
                                                                                                  
CIPF’s role in the Canadian regulatory system is governed by the Memorandum of Understanding (MOU) with the CSA that addresses the governance, funding and maintenance of CIPF as well as CIPF’s responsibilities for investor protection and reporting to the CSA. As provided for by securities laws and regulations in many Canadian provinces and territories, certain regulators, such as FCNB, have also issued Approval Orders regarding CIPF.

The Commission is publishing an amended MOU among the CSA regarding the oversight of the CIPF. The Commission is also publishing the Notice of Termination of the existing CIPF MOU. 

Provided all ministerial approvals are obtained, the new MOU will take effect on 1 January 2021 and the existing MOU will be terminated on the same date.

The MOU amends and restates an existing MOU, which came into effect on 30 September 2008. The MOU is being amended as part of the CSA project aimed to streamline and harmonize the CIPF oversight regime in order to make it more consistent with the current practices and to provide for more consistency between the regulatory approach to CIPF and the Mutual Fund Dealers Association of Canada Investor Protection Corporation. 

As part of this project, the revised CIPF Approval Order has also been approved by the Commission, which will also take effect on 1 January 2021. 

Memoranda of Understanding:

1 January 2021: MOU regarding the Oversight of the CIPF among the CSA (effective January 1, 2021) and  Notice of Termination of the Existing MOU between the CSA and the CIPF

30 September 2008: MOU regarding the Oversight of the CIPF among the CSA

Approval Orders:

1 January 2021: Variation and Restatement of CIPF Approval Order

28 November 2014: CIPF Approval Order

MFDA Investor Protection Corporation

The MFDA Investor Protection Corporation (MFDA IPC) was established on 14 November 2002. Its primary purpose is to provide protection to eligible clients of MFDA dealers if the client’s property held by their dealer is unavailable as a result of the insolvency of the dealer. The MFDA IPC provides coverage to customers of members of the MFDA for losses of property in customer accounts caused by the insolvency of a member. The MFDA IPC’s objective is to return assets to customers or provide compensation for their value as at the date of the insolvency when the assets are not available from the insolvent member. Coverage of customer accounts commenced on 1 July 2005.

The Commission has approved a memorandum of understanding (MOU) regarding the oversight of the MFDA IPC with Alberta Securities Commission; British Columbia Securities Commission; Manitoba Securities Commission; Financial and Consumer Services Commission (New Brunswick); Nova Scotia Securities Commission; Prince Edward Island Office of the Superintendent of Securities; and Financial and Consumer Affairs Authority of Saskatchewan (together with the Commission, the Approving Regulators).

Provided all ministerial approvals are obtained, the MOU will take effect on 1 January 2021.

The primary purpose of the MOU is to govern the Approving Regulators’ oversight of the MFDA IPC, including the coordinated oversight reviews of the MFDA IPC and the approvals of proposed changes to MFDA IPC documents, for which prior approval is required. The MOU is part of the Approving Regulators’ project aimed to streamline and harmonize the MFDA IPC oversight regime in order to make it more consistent with the current practices and to provide for more consistency between the regulatory approach to the MFDA IPC and the Canadian Investor Protection Fund. 

As part of this project, the revised MFDA IPC Approval Order has also been approved by the Commission, which will also take effect on 1 January 2021. 

Memorandum of Understanding:

1 January 2021: MOU among the CSA regarding the Oversight of the MFDA IPC (effective January 1, 2021) 

Approval Orders:

1 January 2021: Variation and Restatement of the MFDA IPC Approval Order

14 May 2015: MFDA IPC Approval Order