(October 12 – 16:45 ET) – The Canadian Securities Administrators chairs have apparently agreed to amend the Distribution Structures committee report, bending to many of the concerns of advisors who will be joining the Mutual Fund Dealers Association in 2001.
At a meeting last week the CSA chairs agreed to amend some of the strictures of its report as it applies to dealers joining to the MFDA. These changes should ameliorate many of the dealers’ concerns.
Perhaps most importantly, the CSA is considering dropping the requirement that advisors disband their personal corporations. Should the requirement be removed, advisors will be allowed to flow their commissions through corporations, preserving the tax benefit they receive from that structure.
Advisors will be allowed to put their financial planning business through either their fund dealer or the insurance side in the case of dually-licensed reps. The CSA will likely also continue to permit bulk transfers, at least for a couple of years. There will likely also be a transition period for increased capital requirements and the application deadline will be extended from within 30 days of recognition to within 75 days.
The OSC would not confirm these changes, it is expected to announce them in a news release next week.
-IE Staff