Notice of BCSC Non-Objection to Proposed Amendments to MFDA Recognition Order and By-law No. 1 re: Directors


View PDF of Amendments to Section 1 (Definitions) and Section 3 (Directors) Blackline PDF 
View PDF of Summary of Public Comments PDF
View PDF of Mutual Fund Dealers Association of Canada Variation Order PDF

On November 14, 2008, the BCSC varied the MFDA's recognition order to remove the definition of public director and make various other housekeeping changes. On September 30, 2008, the BCSC did not object to the MFDA's proposed amendments to its By-law No. 1, including proposed amendments to the definition of public director.

The Alberta Securities Commission, Saskatchewan Financial Services Commission, Manitoba Securities Commission, Ontario Securities Commission, New Brunswick Securities Commission and Nova Scotia Securities Commission also varied the MFDA's recognition orders in those jurisdictions and have approved the amendments to By-law No. 1.

The MFDA applied to remove the definition of public director from its recognition order because it is also included in By-law No. 1. The MFDA prefers to have the definition in the By-law, because the process for amendments, if necessary, is more efficient that for amending the recognition order. The MFDA must obtain Commission approval for amendments in both cases.

The amendments to By-law No. 1 include:

  • changes to the definition of public director to align MFDA governance standards with current SRO practices and to increase the number of individuals who meet the requirements to act as public director;
  • increases to the maximum tenures for both independent and public directors to eight years, also consistent with current SRO practice;
  • a transition provision to clarify current directors' eligibility for re-election; and
  • changes to reflect members from a right of members to nominate candidates for director to a right to recommend candidates, to reflect the MFDA's current practice.

The BCSC published the proposed amendments for comment on its website on May 23, 2008. The MFDA has summarized the comments it received on the proposals and provided responses. We attach a copy of the summary and responses, together with a blacklined copy of the By-law showing the changes made from the current By-law. We also attach a copy of the variation order.

 

November 28, 2008