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Bulletin #0587-P

For further information, please contact:

Paige Ward
General Counsel, Corporate Secretary and Vice President, Policy
Policy
Amendments to MFDA By-law No. 1 and Rules

Amendments to MFDA By-law No. 1 and Rules

The MFDA held its 2013 Annual General and Special Meeting of Members (“AGM”) on December 5, 2013.  At the AGM, Members approved certain amendments to MFDA By-law No. 1, Rule 2.5.5 (Branch Manager), Rule 2.2.5 (Relationship Disclosure), Rule 2.4.4 (Transaction Fees or Charges) and Rule 5.4.2 (Trade Confirmations – Automatic Payment Plans), as set out below.  

1. Amendments to MFDA By-law No. 1

Amendments to the definition of “Approved Person”, as set out in in By-law No. 1, clarify that, in order to be subject to the jurisdiction of the MFDA as an Approved Person, an individual must either be registered or permitted under securities law or submit to the jurisdiction of the MFDA.  The amendments have received all requisite approvals and are now effective.  The amended definition of “Approved Person” is set out in Schedule “A” to this Bulletin.

Additional amendments to By-law No. 1 relate to the continuance of the MFDA under the Canada Not-for-profit Corporations Act.  The amendments are awaiting the approval of the recognizing securities regulatory authorities and will be effective on a date to be subsequently determined by the MFDA.  To view the proposed amendments, please go to: http://www.mfda.ca/regulation/propamend.html

2. Amendments to MFDA Rule 2.5.5 (Branch Manager)

Rule 2.5.5, as amended, became effective on September 12, 2013 and received Member ratification at the 2013 AGM.

Amendments to Rule 2.5.5 allow Members to develop compliance and supervisory structures that are appropriate for individual types of businesses, while continuing to ensure that there are adequate structures and procedures in place to identify and manage potential compliance issues at the branch level.  For more information, please refer to MFDA Staff Notice MSN-0082 Branch Supervision, issued on September 12, 2013.

3. Amendments to MFDA Rules 2.2.5 (Relationship Disclosure), 2.4.4 (Transaction Fees or Charges) and 5.4.2 (Trade Confirmations – Automatic Payment Plans)

Conforming changes are required to MFDA Rules 2.2.5 and 2.4.4 to make them consistent with requirements established under National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, which will come into effect on July 15, 2014.  Conforming changes are also required to Rule 5.4.2. 

The proposed amendments have received Member approval, but are awaiting the approval of the recognizing securities regulatory authorities and will be effective on a date to be subsequently determined by the MFDA.  To view the proposed amendments, please go to: http://www.mfda.ca/regulation/propamend.html

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Schedule “A”

The following amended definition of “Approved Person”, as set out in By-law No. 1, has received all requisite approvals and is now effective.

Approved Person” means, in respect of a Member, an individual who is a partner, director, officer, compliance officer, branch manager, or alternate branch manager, employee or agent of the Member who conducts or participates in the dealer business of the Member and who (i) is registered or permitted, licensed or approved in the appropriate category, where required by applicable securities legislation, by the securities commission having jurisdiction, and (ii) is designated and qualified as such in accordance with the Rules, or (iii) is otherwise subject submits to the jurisdiction of the Corporation.