Unit 1 - Regulatory environment xxxxxxxxx

Regulatory Canadiam market

1. Unit 1: Regulatory Environment

2. In this unit you will learn about: Regulatory Bodies Regulations What You Will Learn in this Unit

3. In Canada there are several regulatory bodies: Provincial and territorial regulatory b odies Canadian Securities Administrators (CSA) Mutual Fund Dealers Association of Canada (MFDA) Investment Industry Regulatory Organization of Canada (IIROC) Regulatory Bodies

4. Primary roles and functions of the provincial and territorial regulatory bodies are: setting its own standards for registration power to grant and revoke registrations Provincial and Territorial Regulatory Bodies m andate to protect investors from unfair, improper or fraudulent practices promote fair and efficient capital markets

5. policy-making body composed of members from each securities regulator. forum for Canada’s securities regulators to improve, coordinate and harmonize regulation of Canadian capital markets. Canadian Securities Administrators to reduce risks to market integrity and investor confidence.

6. self-regulatory organization for mutual fund distributors its members are mutual fund dealers that are licensed with securities regulators. Mutual Fund Dealers Association of Canada The MFDA is empowered by securities regulators to: admit members perform compliance reviews enforce rules

7. self-regulatory organization for investment dealers liaison with provincial securities commissions Investment Industry Regulatory Organization of Canada protection of the investing public maintenance of orderly marketing and trading

8. The mutual fund industry is regulated through several acts including: Mutual Fund Legislation The Securities Act National Instruments (NI) developed through the CSA MFDA rules

9. Securities regulator in each jurisdiction is responsible for administering and enforcing the Securities Act. Securities Act

10. National Instruments are harmonized regulations made by the securities regulators through the CSA. National Instruments

11. The MFDA regulates the operations, standards of practice, and business conduct of its members in order to protect investors. MFDA Rules The MFDA also regulates dealing representatives by virtue of their relationship with their sponsoring mutual fund dealer.

12. NI 31-103 contains harmonized rules for registration of firms and individuals with the provincial securities commissions. Main National Instruments NI 81-101 prescribes the content of key disclosure documents including the simplified prospectus, fund facts document and annual information form. NI 81-102 regulates how mutual funds are managed, bought and sold. NI 81-105 ensures that mutual funds are sold based on what is suitable for, and in the best interests of investors.

13. As a dealing representative, you must be aware of regulations that affect you, including: Regulations Anti Money Laundering (AML) Privacy (PIPEDA) Do Not Call List (DNCL)

14. Proceeds of Crime (Money Laundering) and Terrorist Financing Act

15. Proceeds of Crime (Money Laundering) and Terrorist Financing Act

16. Proceeds of Crime (Money Laundering) and Terrorist Financing Act

17. Financial Transactions and Reports Analysis Centre of Canada

18. Privacy Act

19. Personal Information Protection and Electronic Documents Act

20. Do Not Call List

21. Key Areas of Responsibility under PCMLTFA Four key areas of responsibility: reporting to FINTRAC record-keeping confirming client’s identity identifying potentially exposed foreign persons (PEP)

22. Canada’s Anti-Spam Legislation (CASL)