CSA pauses policy work

CSA pauses policy work

The Canadian Securities Administrators (CSA) is adopting a moratorium on new policy work until the end of May — but measures to reduce needless compliance work could still move ahead.

As the effects of the Covid-19 outbreak continue to hang over global financial markets, the CSA said it’s focused on helping industry firms and investors cope with novel challenges.

To that end, it’s suspending the publication of any new policy work until at least May 30.

Earlier, the CSA extended the comment period for existing policy consultations by 45 days.

“We are mindful that most market participants are working remotely and weathering unprecedented challenges to their business,” said Louis Morisset, chair of the CSA and president and CEO of the Autorité des marchés financiers.

“We are hopeful that these actions will free up resources, allowing firms to focus on front-line activities and serving the needs of investors,” he said.

While most reform initiatives are on hold, the CSA said it will consider moving ahead with efforts designed to reduce regulatory burdens if they will provide immediate relief.

“CSA members continue to be in close contact with the companies and firms they regulate, and based on these discussions, will consider proceeding with burden reduction initiatives if they are immediately helpful to businesses in responding to Covid-19,” the regulators said.

Additionally, the CSA said it will consider whether it needs to take further action to ease regulatory demands on the industry.

“As the situation evolves, the CSA will consider whether additional relief for market participants is warranted,” the CSA said.

It also noted it will consider measures to help investors cope with the pandemic.

“We will also consider actions to support investors and ensure they are treated fairly during this difficult time,” the CSA said. “The needs of both stakeholder groups [industry and investors] are important, and CSA members will consider and balance these needs as we fulfil our mandates.”

Major initiatives designed to benefit retail investors were underway before the pandemic took hold, including plans to eradicate the use of deferred sales charge (DSC) mutual fund structures in most of the country (Ontario is consulting on DSC restrictions, instead of an outright ban), alongside the implementation of measures to improve conduct standards (known as the client-focused reforms (CFRs)).

In the U.S., regulators have decided to go ahead with the introduction of similar new retail conduct standards (the U.S. Securities and Exchange Commission’s Regulation Best Interest), which take effect at the end of June.

Source: Investment Executive

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