Client-focused reforms receive Ontario government approval

By James Langton | December 12, 2019 | Last updated on December 12, 2019
2 min read
Sir Oliver Mowat statue at the Ontario Legislative Building in Toronto
© Leonid Andronov / 123RF Stock Photo

The Ontario government gave its blessing today to the Canadian Securities Administrators’ (CSA) client-focused reforms (CFRs), one of the final hurdles toward a set of regulatory reforms designed to enhance advisor/client relationships.

Today’s OSC Bulletin included a notice that, on Nov. 26, Ontario’s Minister of Finance formally approved planned amendments to securities rules that include changes to suitability, know-your-client KYC, conflict of interest and disclosure provisions of the existing registration rules.

Among other things, the reforms will require investment industry firms to resolve material conflicts of interest in the best interest of their clients, put clients’ interests first when determining suitability and enhance disclosure to clients.

In a CSA notice setting out the final reforms, which was published in October, the regulators said that the CFRs are intended to “better align the interests of securities advisors, dealers and representatives with the interests of their clients, improve outcomes for clients and make clearer to clients the nature and the terms of their relationship with registrants.”

Now that ministerial approval has been granted, the rule changes will formally take effect on Dec. 31, yet the specific requirements will be phased in over the next couple of years.

For example, provisions that deal with conflicts of interest and relationship disclosure are slated to take effect on Dec. 31, 2020. The other changes will come into force on December 31, 2021.

The industry self-regulatory organizations — the Investment Industry Regulatory Organization of Canada and the Mutual Fund Dealers Association of Canada — are expected to revise their own rules to conform to the new CSA requirements.

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James Langton

James is a senior reporter for and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.