Download Report

INVESTMENT MANAGEMENT BULLETIN
MARCH 2015
THE YEAR AHEAD – 2015
Key Milestones and Expected Regulatory
Developments for the Investment
Management Industry
This publication The Year Ahead – 2015 is new. It is intended to help you keep track of
regulatory developments and prepare for new regulatory deadlines and also to know what
can be expected during the coming year.
Securities regulation has long been a fact of life for participants in Canada’s investment
management industry. The success of the Canadian industry is driven to a large degree by
the industry’s embrace of the necessity for a strong regulatory regime. But the industry’s
continued growth has attracted close attention from the Canadian Securities Administrators
(the CSA) and investor advocates (including FAIR Canada) in recent years, which has translated
into enhanced regulatory expectations and a relentless drive to seek additional protections
for retail investors. We understand the challenges for the industry in keeping pace with the
regulatory changes, both in monitoring deadlines and understanding what may be coming next.
The Investment Management Group of
Borden Ladner Gervais LLP (BLG) keeps close
watch on regulatory developments. We work with
our clients and others in the industry to allow them
to meet the regulatory challenges and to understand
the new requirements and to know how they should
be implemented. We regularly publish Bulletins and
Alerts describing developments in securities regulation
as it applies to the Canadian investment management
industry, as well as identifying issues in the regulation
and how it must be implemented.
This Bulletin provides a chronological time-line of
regulatory deadlines and new and expected publications
and regulatory announcements. Our 2015 time-line
summarizes known upcoming deadlines, as well as our
best estimate of expected timing of regulatory proposals or
final rules. It is intended as a comprehensive snap-shot of
INVESTMENT MANAGEMENT BULLETIN | MARCH 2015
2
the coming year for industry participants operating in all
jurisdictions of Canada, although it must be recognized
that the timing of regulatory initiatives is subject to
change. And in some cases, the expected timing of
initiatives based on information from the CSA and
other sources is non-specific (“Spring 2015” or
“during 2015”).
Although our time-line does not specifically call out
MFDA or IIROC publications, both self-regulatory
organizations have published reports of their priorities
for 2015. The MFDA’s 2015 regulatory priorities were
outlined in their February 19, 2015 publication entitled
2015 Compliance and Member Education Priorities
and IIROC’s 2015 regulatory priorities were discussed
in their January 27, 2015 publication entitled Annual
Consolidated Compliance Report.
We hope that you will find this Bulletin useful.
Throughout the Bulletin you will find links to
our more detailed newsletters and commentary,
including our letters to the CSA on various regulatory
proposals. Certain national instruments and
companion policies are referred to using shortened
versions of their full name. For example, National
Instrument 31-103 Registration Requirements,
Exemptions and Ongoing Registrant Obligations and
its companion policy are referred to as NI 31-103
and 31-103CP, respectively.
If you have any feedback on this Bulletin or you would
like to discuss any of the initiatives listed in it, including
what they may mean for your business, we would very
much like to hear from you. Please contact your usual
lawyer in BLG’s Investment Management Group or any
of the leaders noted at the end of this Bulletin.
The information in this Bulletin was compiled by Rebecca Cowdery, with input from
the following lawyers:
Rebecca Cowdery 416.367.6340
rcowdery@blg.com
Jason Brooks 604.640.4102 jbrooks@blg.com
Carol Derk
416.367.6181 cderk@blg.com
Ron Kosonic 416.367.6621 rkosonic@blg.com
Julie Mansi 416.367.6224 jmansi@blg.com
Lynn McGrade
416.367.6115 lmcgrade@blg.com
Francesca Smirnakis 416.367.6443 fsmirnakis@blg.com
Laura White 416.367.6268 lmwhite@blg.com
Matt Williams 416.367.6261 mwilliams@blg.com
3
INVESTMENT MANAGEMENT GROUP
The Investment Management Group at BLG consists of a team of over 50 lawyers located in
offices across Canada who understand the business, regulatory and administrative issues that
face participants in the Canadian investment management industry. We have the largest and
most experienced investment management practice in Canada, having provided legal services
to Canadian and international industry participants for over 50 years.
Our lawyers are leaders in investment funds, registrant regulation and compliance, private-pooled
and hedge funds, segregated funds, derivatives and structured products. BLG’s Investment
Management Group is ranked Number 1 in Canada in The Best Lawyers in Canada ® (2008 – 2015)
in the field of Mutual Funds Law. Several of our lawyers are recognized as leaders in the area
of investment funds in industry publications, including:
• Lexpert®/American Lawyer Guide to Leading 500 Lawyers in Canada
• Canadian Legal Lexpert ® Directory
• The Best Lawyers in Canada®
• Who’s Who Legal: The International Who’s Who of Business Lawyers
• PLC Cross-border Investment Funds Handbook
Our clients, both Canadian and international, include open and closed end investment fund complexes,
providers of alternative investment, pooled and private equity products, portfolio managers and dealers,
financial institutions, service providers, securities regulators, self regulatory organizations and industry
trade associations.
BLG is a leading, full service, national law firm focusing on business law, commercial litigation and
intellectual property solutions for our clients. With more than 750 lawyers, intellectual property agents
and other professionals in five Canadian cities, clients turn to us for assistance for all their legal needs,
from major litigation to financing and patent registration.
The Best Lawyers in Canada ® 2015. © Copyright 2014 by Woodward/White, Inc., Aiken, SC.
Lexpert ® is a registered trademark of Thomson Reuters Canada Limited. © Copyright Thomson Reuters Canada Limited and its Licensors.
All rights reserved.
4
JANUARY
FEBRUARY
MARCH
2 0 1 5
1
1
1
2
2
2
3
3
3
4
4
4
5
5
5
6
6
6
7
7
7
8
8
8
9
9
9
10 10 10
FIRST QUARTER
Development
BLG Resources
January 1
First day on which “Reporting Financial Institutions”
were required to have obtained a GIIN from the
U.S. IRS and to have provided their GIIN to U.S.
withholding agents
Canada Reaches Agreement with the U.S. on FATCA
Tax Law Alert February 2014
January 11
Effective date for amendments to NI 31-103 and
31-103CP, as well as amendments to NI 33-109
and related instruments
Significant Amendments to National Instrument
31-103 Finalized Impact on Canadian Registered
and International Firms Effective January 11, 2015
Investment Management Bulletin October 2014
January 16
Date for voluntary submission of specified data to
consultant engaged by CSA to conduct analysis of
mutual fund fees in Canada
February 4
CSA sent fund managers an undertaking concerning
the use of the data requested to be submitted to
consultant engaged by the CSA to conduct analysis
of mutual fund fees in Canada, with request to
submit specified data as soon as possible
February 18
Publication of the Annual Summary Report for 2014
from the OSC’s Investment Funds & Structured
Products Branch
March 11
Effective date of amendments to NI 81-101
and 81-101CP relating to “point of sale”
delivery of Fund Facts to investors by dealers
(with transition periods)
Fund Facts Delivery Before Purchase of Canadian
Mutual Funds – Effective May 30, 2016
Investment Management Bulletin December 2014
March 16
End of comment period on the TSX’s proposed
amendments to the TSX Company Manual for
certain exchange traded products
TSX Proposes New Listing Requirements for
Investment Funds and Structured Products
Investment Management Bulletin January 2015
March 24
End of comment period on Multilateral Instrument
91-101 Derivatives: Product Determination and
Multilateral Instrument 96-101 Trade Repositories
and Derivatives Data Reporting
Proposed Derivatives Product Determination
and Trade Reporting Rules Announced by
Five Additional Provinces Derivatives Alert
January 2015
March 27
Final date to take advantage of the OSC amnesty
for late disclosure of “outside business activities”OSC Staff Notice 13-705
Disclosing “Outside Business Activities” –
OSC Amnesty Deadline Ends March 27, 2015
Investment Management Bulletin January 2015
March 30
End of comment period on CSA Consultation Paper
92-401 Derivatives Trading Facilities
Discover what you need to know about the
Canadian OTC Derivatives Trading Facilities
Consultation Paper Derivatives Alert February 2015
11 11 11
12 12 12
13 13 13
14 14 14
15 15 15
16 16 16
17 17 17
18 18 18
19 19 19
20 20 20
21 21 21
22 22 22
23 23 23
24 24 24
25 25 25
26 26 26
27 27 27
28 28 28
29
29
30
30
31
31
5
SECOND QUARTER
April 11
Effective date for amendments to OSC Rule
13-502 Fees
Letter dated December 17, 2014 from BLG lawyers
providing comments on the proposed amendments
April 30
Publication of the OSC’s draft statement of priorities
for the fiscal year ending March 31, 2016
expected
May 2
May 4
May 5
May 13
May 30
June 30
June 30
expected
“early Spring
2015”
June 30
expected
“Spring 2015”
Filing due date for the 2014 Part XVIII Information
Return required to be filed by CRA by a Reporting
Canadian Financial Institution in respect of
financial accounts maintained by it during the
reporting period, that were determined to be
U.S. Reportable Accounts
Canada Reaches Agreement with the U.S. on FATCA
Tax Law Alert February 2014
End of comment period on OSC Staff Consultation
Paper 15-401 Proposed Framework for an OSC
Whistleblower Program
Incentivizing Reports of Misconduct: The OSC
Proposes New Whistleblower Program Securities
& Capital Markets Bulletin February 2015
Effective date for amendments to NI 45-106 and
OSC Rule 45-501 regarding prospectus exemptions
Significant Changes to Canada’s Exempt Market
Effective May 5, 2015: Implications for Issuers and
Dealers, as well as for Retail Investors Securities
& Capital Markets Bulletin February 2015
End of comment period on proposed National
Instrument 94-101 Mandatory Central Counterparty
Clearing of Derivatives
Don’t be late to the party: The CSA releases proposed
rules relating to mandatory central counterparty
clearing Derivatives Bulletin February 2015
First date that dealers can send (or cause to be sent) Fund Facts Delivery Before Purchase of Canadian
the prescribed notice under NI 81-101 to investors Mutual Funds – Effective May 30, 2016 Investment
in mutual funds who purchase under a PAC plan
Management Bulletin December 2014
to avoid having to provide a Fund Facts document
in advance of the first trade under a PAC plan on
and after May 30, 2016 (when the pre-sale delivery
requirements for Fund Facts become effective)
expected
“Spring 2015”
June 30
expected
“Spring 2015”
1
1
1
2
2
2
3
3
3
4
4
4
5
5
5
6
6
6
7
7
7
8
8
8
9
9
9
10 10 10
11 11 11
12 12 12
13 13 13
14 14 14
15 15 15
16 16 16
17 17 17
18 18 18
19 19 19
20 20 20
21 21 21
22 22 22
Due date for a Canadian Reporting Financial Institution Canada Reaches Agreement with the U.S. on FATCA
to have completed its review of pre-existing individual Tax Law Alert February 2014
accounts that were high value accounts (more than
US$1 million) as at June 30, 2014
23 23 23
Release by the Cooperative Capital Markets
Regulatory System of the draft initial regulations
to be proposed for adoption under the proposed
provincial Capital Markets Act. (comment
period unknown)
26 26 26
Announcement by CSA on progress on mutual fund
fees initiative - CSA Discussion Paper and Request
for Comment 81-407 Mutual Fund Fees
Towards a “More Perfect Union” Details of a
Cooperative Capital Markets Regulatory System
Proposal Released Securities & Capital Markets
Bulletin September 2014
Letter dated December 8, 2014 to the various
provincial governments from lawyers within
BLG’s Securities & Capital Markets Group
Letter dated April 11, 2013 of BLG’s Investment
Management Group providing comments on the
CSA Discussion Paper
Release of consultant’s report
June 30
MAY
BLG Resources
JUNE
Development
APRIL
2 0 1 5
Announcement by CSA on progress on “best
interest” duty for dealers and advisers-CSA
Consultation Paper 33-403 The Standard of
Conduct for Advisers and Dealers: Exploring the
Appropriateness of Introducing a Statutory Best
Interest Duty When Advice is Provided to
Retail Clients
OSC Staff Notice on results of recent reviews of
funds concerning liquidity issues, with views
on best practices
Letter dated February 22, 2013 of BLG’s Investment
Management Group and Securities Litigation Group
providing comments on the CSA Consultation Paper
The Canadian Securities Regulators’ Proposals for
a “Best Interest” Standard for Dealers and Advisers:
the Long Road Ahead Investment Management
Bulletin April 2013
24 24 24
25 25 25
27 27 27
28 28 28
29 29 29
30 30 30
6
AUGUST
1
1
1
2
2
2
3
3
3
4
4
4
5
5
5
6
6
6
7
7
7
8
8
8
9
9
9
JULY
SEPTEMBER
2 0 1 5
THIRD QUARTER
Development
BLG Resources
July 11
Effective date for amendments to NI 31-103 and
31-103CP that will restrict the activities of exempt
market dealers and will provide for a short-term
debt exemption for certain financial institutions
Significant Amendments to National Instrument
31-103 Finalized Impact on Canadian Registered
and International Firms Effective January 11, 2015
Investment Management Bulletin October 2014
July 15
Effective date for CRM-2 amendments to
NI 31-103 that will require dealers and advisers
to send account statements split into two
segments – “nominee name” and “client name”
Canadian Securities Administrators Finalize Rules
Requiring Enhanced Account Level Disclosure by
Registrants: Effective July 15, 2013 Investment
Management Bulletin April 2013
Effective date for amendments to NI 31-103 that
will require fund managers to provide account
statements at least annually to “orphan” investors
in their funds
National Instrument 31-103 At a Glance (REVISED)*
Investment Management Bulletin June 2013
Publication by CSA staff of proposed fund summary
document for exchange traded funds (ETFs)
Fund Facts Delivery Before Purchase of Canadian
Mutual Funds – Effective May 30, 2016 Investment
Management Bulletin December 2014
Publication of final rules or revised rules
Significant Changes to Canada’s Exempt Market
Effective May 5, 2015: Implications for Issuers and
Dealers, as well as for Retail Investors Securities
& Capital Markets Bulletin February 2015
10 10 10
11 11 11
July 31
12 12 12
expected
“Spring or early
Summer 2015”
13 13 13
14 14 14
15 15 15
16 16 16
July 31
expected
for comment on crowdfunding and Ontario
“Summer 2015” OM exemption
17 17 17
18 18 18
September 21
Effective date for new restrictions and requirements
for closed-end funds engaging in securities
lending and use of repurchase and reverse
repurchase agreements
September 30
Expected date for the Annual Report from the OSC’s
Compliance and Registrant Regulation Branch
19 19 19
20 20 20
21 21 21
22 22 22
23 23 23
24 24 24
25 25 25
26 26 26
27 27 27
28 28 28
29 29 29
30 30 30
31 31
expected
Harmonized Securities Regulation for Canadian
Public Investment Funds Finalized with Twist
(But There’s More to Come) Investment
Management Bulletin August 2014
7
FOURTH QUARTER
December 31
expected
“end of
year 2015”
New effective date for disclosure of prescribed
“position” cost in quarterly account statements
(that is, required by March 31, 2016). Announced
in Letter to IIAC from Bill Rice, Chair of the CSA
dated January 28, 2015 (rules to be developed)
Publication of proposed CSA rule amendments
to implement a proposed alternative funds
regulatory regime
Harmonized Securities Regulation for Canadian
Public Investment Funds Finalized with Twist (But
There’s More to Come) Investment Management
Bulletin August 2014
Moving Beyond Mutual Funds New Proposed
Regulation for Public Closed-End Funds and
Alternative Funds Investment Management
Bulletin April 2013
December 31
expected
“during 2015”
Proposed rule amendments to NI 81-101/
NI 81-102 to provide for a standardized risk
classification methodology for use by mutual
funds – CSA Staff Notice 81-325 Status
Report on Consultation under CSA Notice
81-324 and Request for Comment on Proposed
CSA Mutual Fund Risk Classification Methodology
for Use in Fund Facts
Canadian Regulators Propose Standard Deviation
as the Mandatory Risk Measurement for Canadian
Investment Funds Investment Management
Bulletin January 2014
Letter dated March 12, 2014 providing comments
from BLG’s Investment Management Group
DECEMBER
proposed
OCTOBER
December 31
BLG Resources
NOVEMBER
Development
2 0 1 5
1
1
1
2
2
2
3
3
3
4
4
4
5
5
5
6
6
6
7
7
7
8
8
8
9
9
9
10 10 10
11 11 11
12 12 12
13 13 13
14 14 14
15 15 15
16 16 16
17 17 17
18 18 18
19 19 19
20 20 20
21 21 21
22 22 22
23 23 23
24 24 24
25 25 25
26 26 26
27 27 27
28 28 28
29 29 29
30 30 30
31
31
INVESTMENT MANAGEMENT GROUP
National Leader
John E. Hall
Toronto 416.367.6643jhall@blg.com
Regional Leaders
Brad J. Pierce
Calgary 403.232.9421bpierce@blg.com
Christian Faribault Montréal Lynn M. McGradeToronto
514.954.2501 cfaribault@blg.com
416.367.6115 lmcgrade@blg.com
Jason J. Brooks Vancouver604.640.4102 jbrooks@blg.com
BORDEN LADNER GERVAIS
LAWYERS | PATENT & TRADE-MARK AGENTS
Calgary
Centennial Place, East Tower
1900, 520 – 3rd Ave S W, Calgary, AB, Canada T2P 0R3
T 403.232.9500 | F 403.266.1395
Montréal
1000 De La Gauchetière St W, Suite 900, Montréal, QC H3B 5H4
T 514.879.1212 | F 514.954.1905
Ottawa
World Exchange Plaza, 100 Queen St, Suite 1300
Ottawa, ON, Canada K1P 1J9
T 613.237.5160 | F 613.230.8842 (Legal)
F 613.787.3558 (IP) | ipinfo@blg.com (IP)
Toronto
Scotia Plaza, 40 King St W, Toronto, ON, Canada M5H 3Y4
T 416.367.6000 | F 416.367.6749
Vancouver
1200 Waterfront Centre, 200 Burrard St, P.O. Box 48600
Vancouver, BC, Canada V7X 1T2
T 604.687.5744 | F 604.687.1415
blg.com
This publication is not intended to constitute legal advice, a complete statement of the law, or an opinion
on any subject. No one should act upon it or refrain from acting without a thorough examination of the
law after the facts of a specific situation are considered. You are urged to consult your legal adviser if
you have specific questions or concerns. BLG does not warrant, guarantee the accuracy, currency or
completeness of this publication. No part of this publication may be reproduced without prior written
permission of Borden Ladner Gervais LLP (BLG). If this publication was sent to you by BLG and you do
not wish to receive further publications from BLG, you may ask to have your contact information removed
from our mailing lists by phoning 1.877.BLG.LAW1 or by emailing unsubscribe@blg.com. BLG’s privacy
policy relative to publications may be found at www.blg.com/home/website-electronic-privacy.
© 2015 Borden Ladner Gervais LLP
Borden Ladner Gervais LLP is an Ontario Limited Liability Partnership.