Mutual Fund Dealers Association of Canada
Association canadienne des courtiers de fonds mutuels
121 King Street West, Suite 1600, Toronto, Ontario, M5H 3T9
TEL: 416-361-6332 FAX: 416-943-1218 WEBSITE: www.mfda.ca
BULLETIN #0025 – M
July 17, 2003
E-mail : [email protected]
For Distribution to Relevant Parties within your Firm
Potential Canadian Postal Strike
There is a possibility of a nationwide postal strike as early as midnight tonight. The MFDA has
received a number of inquiries regarding requirements for delivery of documents if there is a
There are no specific exemptions under applicable securities law to suspend prescribed delivery
requirements of documents during a postal strike. For example, Members and Approved Persons
are reminded that the following general legal requirements remain in force during a postal strike:
• Prospectuses are required to be sent to purchasers by the dealer by prepaid mail or
delivery. Purchasers acquiring mutual funds have a right of withdrawal for two days after
receiving the prospectus, entitling the purchasers to the full amount invested plus any fees
and charges paid.
• Trade confirmations are required to be sent by the dealer to the clients by prepaid mail or
delivery. Clients have the right the rescind a purchase of $50,000 or less for two days
after receipt of the confirmation, entitling clients to the redemption price as of the day of
rescission, plus any fees or charges.
• Redemption payments must be sent no later than three business days after the relevant
MFDA document delivery requirements would similarly remain unaffected by a postal strike.
This would include, for example, MFDA requirements respecting:
• Monthly, quarterly and annual filings by Members, as well as "early warning"
• Account statements required to be provided to clients.
• Written trade confirmations required to be provided to clients.
• Requests for information required to be provided to MFDA Staff.
MFDA Staff urge Members to implement arrangements to ensure ongoing compliance with
applicable legal and regulatory requirements during a postal strike and suggest the following
steps be taken:
Every effort should be made to provide clients with the opportunity to receive
confirmations and monthly statements. Some alternatives are fax, e-mail and commercial
delivery to branch offices for client pick-up.
Fax copies of client documents which must be signed prior to trading are acceptable on
an interim basis. Members should have procedures in place to follow-up on any originals
that are not received within a reasonable time after postal service resumes.