The Mutual Fund Dealers Association of Canada (MFDA) has received regulatory approval for a new general proficiency requirement, the self-regulatory organization announced on Thursday.
The MFDA received approval from the provincial regulators for proposed amendments to its rules that introduce a general requirement for reps to be properly qualified for the services they provide. The measure aims to ensure that reps have adequate training and proficiency when they deal in products, such as exchange-traded funds (ETFs), that may differ somewhat from conventional mutual funds.
Under the new rule, reps must not perform a registerable activity unless they have the necessary education, training and experience.
Last year, the MFDA also issued a consultation paper seeking input on a possible new standard for reps selling ETFs that would satisfy the new general proficiency requirement by providing additional training on the specific characteristics and features of ETFs, and how they are traded at the dealer. It has yet to propose a new standard.
The amendments also include changes to adopt a definition of "outside activity" that includes activities involving any officer, director and equivalent positions.