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Bulletin #0111-P

Policy
Procedure for Exemptive Relief Applications

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

Contact: Paige L. Ward

BULLETIN #0111-P
Director
of
Policy
and
Regulatory
Affairs
November
5,
2004
Phone: 416-943-5838
E-mail: pward@mfda.ca

MFDA Bulletin

Policy

For Distribution to Relevant Parties within your Firm


Procedure for Exemptive Relief Applications

This Bulletin is intended to provide guidance on how to make an application for exemptive relief
from MFDA By-laws, Rules and Forms (“Exemptive Relief Applications”).

1.
Authority for Dealing with Exemptive Relief Applications

Section 37 of MFDA By-law No.1 provides that the Board of Directors has discretionary
authority to exempt any Member, Approved Person, or any other person subject to the
jurisdiction of the Corporation, or any group or class of the foregoing persons (“Applicant”),
from the requirements of any provision of the By-laws, Rules and Forms (“Regulatory
Instruments”) where it is satisfied that to do so would not be prejudicial to the interests of the
Members, their clients or the public. In granting such an exemption the Board of Directors may
impose such terms and conditions as are considered necessary or desirable.

The Regulatory Issues Committee of the MFDA Board of Directors is responsible for the
consideration and disposition of Exemptive Relief Applications.

2.

Content and Format of Exemptive Relief Applications

There is no prescribed form for Exemptive Relief Applications. Exemptive Relief Applications
should be set out in writing and addressed to the Membership Services Department. At a
minimum, the Exemptive Relief Application should include the following information:

• the identity of the Applicant;
• the exact nature of the relief sought;
• the facts on which the Exemptive Relief Application is based; and


• detailed reasons for requesting exemptive relief from the application of the particular
MFDA Regulatory Instrument.

3.

MFDA Staff Review

Upon receipt, all Exemptive Relief Applications are assigned to appropriate MFDA staff for
review and consideration. MFDA staff will consider the submissions made in the Exemptive
Relief Application and evaluate the proposed relief sought in light of the regulatory objective of
the requirement that the Applicant is requesting relief from and the criteria set out in Section 37
of MFDA By-law No.1. MFDA staff may contact the Applicant if further information or
clarification is required.

4.

MFDA Staff Recommendation

4.1 Recommendation that Exemptive Relief be Granted

Where staff is of the view that exemptive relief should be granted having regard to the criteria set
out in section 37 of By-law No.1, the Applicant will be notified that MFDA staff supports the
relief sought and will make a recommendation to the MFDA Regulatory Issues Committee to
this effect.

4.2 Recommendation that Exemptive Relief Not be Granted

Where after reviewing the Exemptive Relief Application, MFDA staff is of the view that
exemptive relief should not be granted, a letter will be sent to the Member advising that staff is
not prepared to recommend to the MFDA Regulatory Issues Committee that the proposed relief
be granted. The letter will set out the reasons of MFDA staff for its position on the Exemptive
Relief Application and inform the Applicant that if they wish to have their request for exemptive
relief referred to the Regulatory Issues Committee without staff support, they may make a formal
request to this effect.

5.
Consideration by the Regulatory Issues Committee

A meeting of the Regulatory Issues Committee will be scheduled to consider the Exemptive
Relief Application where, following a review of an Exemptive Relief Application, MFDA staff
is of the view that: (i) the exemptive relief requested should be granted or; (ii) where staff is of
the view that the exemptive relief requested should not be granted and the Applicant formally
requests that their Application be considered by the Regulatory Issues Committee.

MFDA staff will notify the Applicant once a meeting date has been set for the Regulatory Issues
Committee to consider the Exemptive Relief Application.

The Applicant will be provided with a draft copy of the written materials that will be sent to the
Regulatory Issues Committee in advance of the meeting and given the opportunity to comment
or provide further written submissions.

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In the normal course, the Applicant would not be expected or invited to attend and make
submissions at the meeting. The Regulatory Issues Committee may however invite the Applicant
or the Applicant may request to attend and make submissions at the meeting.

6.
Decision of Regulatory Issues Committee
MFDA staff will notify the Applicant by letter of the decision of the Regulatory Issues
Committee attaching written reasons prepared by the members of the Regulatory Issues
Committee that considered the Application.

7.

Review of Decision

Section 26 of MFDA By-law No.1 provides that a person affected by a decision of the Board of
Directors, a Regional Council or the Corporation in respect of which no further review or appeal
is provided in the By-laws may request any securities commission given jurisdiction in the
matter under its enabling legislation to review such decision. The Securities Acts in Ontario,
Alberta, British Columbia, Saskatchewan, Nova Scotia and Newfoundland provide a right for a
person affected by a direction, decision, order or ruling made under a by-law, rule, regulation,
policy, procedure, interpretation or practice of a recognized self-regulatory organization to
request a review by the Commission.

8. Notice
to
Members

Notice of exemptions granted from MFDA Regulatory Instruments by the Regulatory Issues
Committee will be given to Members subject to requests from Applicants that details of the
Exemptive Relief Application and the exemptive relief granted be treated as confidential.

9.
Request for Confidential Treatment of Exemptive Relief Application
Applicants who wish to maintain confidential treatment of their Exemptive Relief Application
must make a separate submission to the Regulatory Issues Committee providing reasons as to
why the request for confidentiality is reasonable and not prejudicial to the interest of Members,
clients or the public.

(doc #41993)

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