Decision No. 2020-PDG-0030: General Decision Regarding Exemption from Certain Obligations of National Instrument 31-103

DECISION NO. 2020-PDG-0030
General Decision Regarding an Exemption from Certain Obligations of Regulation 31-103 on Registration Requirements and Exemptions and Ongoing Obligations of Registered Entities

Having regard to the publication by the Canadian Securities Administrators on October 3, 2019, of amendments to Regulation 31-103 on Registration Requirements and Exemptions and Ongoing Obligations of Registered Entities, RLRQ, c. V-1.1, r. 10 (the "Regulation 31-103") relating to client-focused reforms;

Having regard to the Regulation amending Regulation 31-103 on Registration Requirements and Exemptions and Ongoing Obligations of Registered Entities (the "Regulation Amending Regulation 31-103") approved by Ministerial Order No. 2019-09 of December 11, 2019 (2019, G.O. 2, 5174), which implements these amendments;

Having regard to the Regulation Amending Regulation 31-103 which provides for a phased implementation of the amendments to Regulation 31-103, namely December 31, 2020, for the amendments relating to conflicts of interest and provisions regarding relationship information, and December 31, 2021, for the other amendments;

Having regard to recent consultations conducted by the Autorité des marchés financiers (the "Autorité") with sector participants regarding the implementation of the Regulation Amending Regulation 31-103, which revealed operational difficulties caused by the changes that registered entities will have to make regarding relationship information when implementing the other amendments to Regulation 31-103 on December 31, 2021;

Having regard to section 263 of the Securities Act, RLRQ, c. V-1.1 (the "SA"), which allows the Autorité, under the conditions it determines, to exempt a person or group of persons from all or part of the obligations provided for in Titles Two to Six of this Act or by regulation when it considers that such exemption does not prejudice the protection of savers;

Having regard to section 86 of the Derivatives Act, RLRQ, c. I-14.01 (the "DA"), which allows the Autorité, under the conditions it determines, to exempt a derivative, a person, a group of persons, an offering or a transaction from all or part of the obligations provided for by this Act when it considers that such exemption does not prejudice the public interest;

Having regard to section 99 of the DA which allows the Autorité, according to the terms and conditions it determines, to issue a decision of general or particular scope that may apply specifically to any matter within its jurisdiction under the DA;

Having regard to the analysis by the Intermediary Oversight Directorate and the recommendation of the Superintendent of Client Assistance and Distribution Oversight to grant the present decision on the grounds that it does not prejudice the protection of savers nor the public interest;

Therefore:

Registered Entities as Dealers, Advisers or Investment Fund Managers under the SA

1. The Autorité exempts registered entities as dealers, advisers or investment fund managers under the SA from the application of the obligations provided for in Part 14 of Regulation 31-103 as amended by articles 21 and 22 of the Regulation Amending Regulation 31-103, which will come into force on December 31, 2020, on the condition that these entities comply with these obligations of Part 14 of Regulation 31-103 as they read on December 30, 2020;

Registered Entities as Dealers or Advisers under the DA
2. The Autorité exempts registered entities as dealers or advisers under the DA from the application of section 11.1 of the Regulation respecting Derivatives, RLRQ, c. I-14.01, r. 1, with respect to the obligations provided for in Part 14 of Regulation 31-103 as amended by articles 21 and 22 of the Regulation Amending Regulation 31-103, which will come into force on December 31, 2020, on the condition that these entities comply with these obligations of Part 14 of Regulation 31-103 as they read on December 30, 2020.

This decision takes effect on December 31, 2020 and will cease to have effect on December 31, 2021.

Done on April 15, 2020.

Louis Morisset
President and Chief Executive Officer