Canadian regulators seek comment on extension of passport system to registration

    VANCOUVER, July 18 /CNW/ - The Canadian Securities Administrators (CSA)
today published proposals to streamline the process for dealer and adviser
registration in multiple jurisdictions.
    The proposals include rule and policy amendments by CSA members in
passport jurisdictions to extend the second phase of passport to registration.
They also include a new proposed national policy, setting out the processes
for registration in multiple jurisdictions for adoption by all CSA members.
    "Making the passport system available for the dealer and adviser
community will give all market participants faster and simpler access to
Canada's capital markets," said CSA Chair Jean St-Gelais. "This phase of
passport will simplify the regulatory processes and benefit registrants and
investors in all provinces and territories."
    The proposed amendments to Multilateral Instrument 11-102 Passport System
to extend passport to the dealer and adviser community is the last step in
fulfilling a major commitment in the memorandum of understanding regarding
securities regulation among the governments of passport jurisdictions. Ontario
is not a passport jurisdiction.
    The new proposed policy, National Policy 11-204 Process for Registration
in Multiple Jurisdictions, will replace and streamline the current National
Registration System (NRS) and establishes the process for obtaining
registration in multiple jurisdictions, including Ontario.
    Once the proposals are adopted, the passport system will be fully
implemented. Passport will allow someone to clear a prospectus, obtain a
discretionary exemption or register in the home province and have that
clearance, exemption or registration apply automatically in all other passport
provinces and territories.
    The foundation for passport is a set of harmonized regulatory
requirements consistently interpreted and applied throughout Canada. The
proposed amendments to MI 11-102 and new NP 11-204 are expected to be adopted
concurrently with the proposed new national rule on registration requirements
(National Instrument 31-103 Registration Requirements), which will harmonize
and streamline the registration regime in Canada. The CSA expects to implement
NI 31-103 in the first half of 2009.
    The proposed amendments to MI 11-102, the new NP 11-204, and related
documents are available on various CSA members' websites. Except for the
repeal of NRS, the comment period is open until September 17, 2008. The
comment period on the repeal of NRS is open until October 17, 2008.
    The CSA, the council of the securities regulators of Canada's provinces
and territories, co-ordinates and harmonizes regulation for the Canadian
capital markets.

                       Passport System for Registration

    What is passport?

    A system that gives a market participant access to capital markets in
multiple jurisdictions by dealing only with its principal regulator and
complying with one set of harmonized laws.

    How does it work?

    -   Each market participant has a principal regulator, typically in its
        home jurisdiction

    -   A market participant can register in all passport jurisdictions
        through its principal regulator

    -   If the principal regulator imposes terms and conditions, the same
        terms and conditions apply automatically in all non-principal
        passport jurisdictions

    -   If the principal regulator suspends, terminates or accepts a
        surrender of registration, that decision applies automatically in all
        non-principal passport jurisdictions

    -   Market participants are subject to one set of harmonized registration
        requirements in all jurisdictions

    What are the benefits of passport?

    -   Simpler - requires only one registration decision - comply with one
        set of harmonized laws

    -   Faster - deal with one regulator

    -   Cheaper - eliminate professional costs for dealing with multiple
        regulators and different laws

    What does it mean for Ontario?

    -   Ontario market participants have direct access to the markets in
        other jurisdictions by dealing only with the Ontario Securities
        Commission (OSC), even though Ontario has not adopted the passport

    -   Other market participants gain access to the Ontario market through a
        streamlined interface

    Registration process:

    A firm or individual seeking registration in a category in the home
    jurisdiction and in a passport jurisdiction

    -   makes a single submission

    -   has the submission reviewed by only one regulator

    -   is automatically registered in the other jurisdiction in the case of
        an individual, when he or she is registered in his or her home
        jurisdiction and, in the case of a firm, when receipt of the
        submission has been acknowledged

    A firm or individual registered in a category in the home jurisdiction
    and seeking registration in the same category in a passport jurisdiction

    -   makes a single submission

    -   has the submission reviewed by only one regulator

    -   is automatically registered in the other jurisdiction in the case of
        an individual, when he or she makes the submission and, in the case
        of a firm, when receipt of the submission has been acknowledged

    In both cases, if a firm's or individual's home jurisdiction is outside
Ontario, but they are seeking registration in Ontario, the OSC makes its own
registration decision.
    An investment dealer firm and its representatives continue to deal with
the Investment Industry Regulatory Organization of Canada, where applicable.

    To arrange interviews with CSA Chair Jean St-Gelais, please contact

    Christian Barrette
    Autorité des marchés financiers

For further information:

For further information: Andrew Poon, British Columbia Securities
Commission, (604) 899-6880; Barbara Shourounis, Saskatchewan Financial
Services Commission, (306) 787-5842; Christian Barrette, Autorité des marchés
financiers, (514) 940-2176; Fred Pretorius, Yukon Securities Registry, (867)
667-5225; Shirley Lee, Nova Scotia Securities Commission, (902) 424-5441; Mark
Dickey, Alberta Securities Commission, (403) 297-4481; Ainsley Cunningham,
Manitoba Securities Commission, (204) 945-4733; Wendy Connors-Beckett, New
Brunswick Securities Commission, (506) 643-7745; Marc Gallant, Prince Edward
Island, Office of the Attorney General, (902) 368-4552; Doug Connolly,
Financial Services Regulation Division, Newfoundland and Labrador, (709)
729-2594; Louis Arki, Nunavut Securities Registry, (867) 975-6587; Donald
MacDougall, Securities Registry, Northwest Territories, (867) 920-8984; Laurie
Gillett, Ontario Securities Commission, (416) 595-8913

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