Like all phases, CIRO’s almost- last phase of its proposed rule rewrite due to IIROC/MFDA consolidation is a grouping of disparate rules on a variety of topics, some of which have been addressed through separate consultations.

Of note, this set includes:

• Introducing/Carrying broker arrangements. These rules have had little relative change since the inception of this model which has had meaningful impact for dealers. There is opportunity for updating and streamlining these rules away from Types 1-4 (and now a proposed Type 5 for mutual fund dealers) and leaving more room for contractual, fact and market -based, arrangements between dealers.  To be done properly, this requires a focused attention outside of the current rule consolidation process.

• Monthly Financial Reporting.  CIRO has added MFDA considerations into the current IIROC form. In light of the length, cost and import of monthly reporting, a closer look at streamlining the reporting may be a fruitful exercise that also requires focused attention outside of the current rule consolidation process.

• Jurisdictional Issues: There continues an attempted expansion of CIRO jurisdiction to non-securities and/or non-securities related matters. There are better fixes to our fragmented regulatory system. 

• Reporting : Proposed amendments underscore premature reporting of internal investigations which are better streamlined to instances where securities breaches are confirmed.

• Complaint Handling: There continues an over-focus on retail client complaints unsupported by data.

So far, the rule consolidation effort has been a missed opportunity to create a new, better, more efficient regulator.

CIRO agreed to CFFiM’s request to reproduce its full draft rulebook showing all updated proposed changes after incorporating any comments before they are finalized. This should be used as another opening to improve outcomes. 

CFFiM’s analysis to CIRO of its last phase of its proposed rule rewrite due to IIROC/MFDA consolidation is found here.