33-102 - Proposed Consequential and Related Amendments to the Securities Rules Relating to National Instrument 33-102 - Registrant Dealing with Clients [NI Amendment Proposed - Lapsed]
| Published Date: | 2000-07-21 |
|---|
Proposed Consequential and Related Amendments to the Securities Rules
Relating to National Instrument 33-102
Registrant Dealing with Clients
Interpretation
1.(1) In these rules:
"branch office"1
1 "Sub-branch office" is not defined, although it is used as a term of art in Companion Policy 33-102CP with relation to compliance and supervisory activities. Section 66(2) of the Securities Rules sets out compliance and supervisory requirements for a branch office with fewer than 4 registered individuals.
, in relation to a dealer or adviser, means a location, including a residence,^ where the dealer or adviser carries on any business as a dealer or adviser ^, either alone or through one or more ^ individuals2
2Advisers have been added in anticipation that financial institutions, or their related adviser registrants, may carry on the business of advising through a branch network. Makes consistent with item 7(b) of section 22(1) of the Securities Regulation, which establishes fees for certain branch offices of advisers.
, but does not include
(a) the dealer’s or adviser’s chief place of business, or
(b)a location where the dealer or adviser carries on business for 50 or fewer days in any calendar year;3
3 This accommodates the situation of "roving registrants" and, more generally, situations like booths at shopping malls and trade shows.
Disclosure of referral fees and commission splitting
53.(3) Subject to subsection (4), the disclosure required under subsections (1) and (2) must
(a) be made
(i) in the circumstances described in subsection (1) (a), ^ before the fee is accepted,
(ii) in the circumstances described in subsection (1) (b), ^ before the fee is paid,
(iii) in the circumstances described in subsection (2), at the time the purchase or sale is made or as soon as practicable after that time,
^(b)be in writing, and
(c)contain
(i)the amount of the fee or, if not determinable, the method of calculating the fee,
(ii)to whom and by whom the fee is to be paid, and
(iii)the services for which the fee is payable.
Designated compliance officer ^ and branch manager ^
60.(1) The designated compliance officer referred to in section 65 and the branch manager ^ 4
4References to "administration officer" have been removed to reflect the decision to require mutual fund dealers that are related to financial institutions to have branch managers, employed by the dealer, rather than administration officers employed by the financial institution (as currently permitted under the "Principles of Regulation").
referred to in section 66 must have successfully completed the courses and examinations and have the experience the executive director requires.
(2) ^ Except where otherwise permitted by the executive director, if the compliance officer referred to in section 65 is designated by
(a) a dealer, the compliance officer must be a trading partner, director or officer, or
(b) an adviser, the compliance officer must be an advising partner, director or officer.
Branch manager ^ required
66.(1) Subject to subsections (2) and (3), a dealer or adviser that carries on business in a branch office must employ, with the approval of the executive director, ^ a branch manager ^ to ensure that the branch complies with the Act and the regulations.
(2) If fewer than 4 registered individuals carry on business in a branch office of a dealer or adviser, the dealer or adviser is not required to comply with subsection (1) if the executive director is satisfied that a branch manager ^ in another branch office is able to ensure that the branch office without a ^ branch manager5
5Replacement of the words "compliance officer" with "branch manager" corrects the existing legislation.
complies with the Act and the regulations.
(3)The executive director may permit more than 4 registered individuals to carry on business in a branch office without a branch manager where one or more of the individuals carries on business on a part-time basis.6
6 This provision addresses the situation, common to mutual fund dealers related to financial institutions, where salespersons may work only part-time for the dealer (the balance of the time being devoted to financial institution work).
Limitations on networking
84.(2) A registrant that intends to enter into a networking arrangement with a savings institution or an insurer that is not a related party of the registrant must, at least 30 days before entering into the networking arrangement, file written notice of its intention, providing all relevant facts relating to the networking arrangement.