Decision No. 2020-PDG-0031: General Decision Regarding Exemption from Certain Obligations of National Instrument 31-103 Related to COVID-19

DECISION NO. 2020-PDG-0031
General Decision Regarding an Exemption from Certain Obligations of National Instrument 31-103 on Registration Requirements and Exemptions and Ongoing Obligations of Registered Entities

Having regard to the COVID-19 pandemic declared by the World Health Organization on March 11, 2020;

Having regard to the state of health emergency declared on March 13, 2020, by the Minister of Health and Social Services pursuant to section 118 of the Public Health Act, RLRQ, c. S-2.2, which applies to the entire province of Quebec, and the renewals of this state of health emergency on March 29 and April 7, 2020;

Having regard to the disruptions resulting from the COVID-19 pandemic, particularly regarding travel, access to premises, and the availability of personnel and resources, which create difficulties for registered entities and other market participants in complying with certain obligations under the Securities Act, RLRQ, c. V-1.1 (the "ASA"), and the Derivatives Act, RLRQ, c. I-14.01 (the "DA"), as well as the regulations made under these laws;

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

Having regard to the Act to amend National Instrument 31-103 on Registration Requirements and Exemptions and Ongoing Obligations of Registered Entities (the "Amending NI 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 Amending NI 31-103 which provides for a phased implementation of the amendments to NI 31-103, namely December 31, 2020, for the amendments relating to conflicts of interest and provisions relating to relationship information, and December 31, 2021, for the other amendments;

Having regard to the difficulties created for registered entities regarding compliance with the obligations of NI 31-103 that will come into effect on December 31, 2020;

Having regard to section 263 of the ASA which allows the Autorité des marchés financiers (the "Authority"), 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 this exemption does not prejudice the protection of savers;

Having regard to section 86 of the DA which allows the Authority, 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 in this Act, when it considers that this exemption does not prejudice the public interest;

Having regard to section 99 of the DA which allows the Authority, according to the procedures and under the 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 this decision on the grounds that it does not prejudice the protection of savers or the public interest;

Therefore:

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

1. The Authority exempts registered entities as dealers, advisers, or investment fund managers under the ASA from the application of the obligations provided for in Part 13 of NI 31-103 as amended by sections 12 to 15, 17, and 18 of the Amending NI 31-103, which will come into effect on December 31, 2020, on the condition that these entities comply with these obligations of Part 13 of NI 31-103 as they read on December 30, 2020;

Registered Entities as Dealers or Advisers under the DA
2. The Authority 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 13 of NI 31-103 as amended by sections 12 to 15, 17, and 18 of the Amending NI 31-103, which will come into effect on December 31, 2020, on the condition that these entities comply with these obligations of Part 13 of NI 31-103 as they read on December 30, 2020.

This decision takes effect on December 31, 2020, and will cease to have effect on June 30, 2021.

Done on April 15, 2020.

Louis Morisset
President and Chief Executive Officer