Ontario will remain a holdout, but the rest of Canada’s securities regulators are moving ahead to ban deferred sales charges (DSCs).

The Canadian Securities Administrators (CSA) have announced that they intend to publish a final set of rule changes in 2020 that will effectively outlaw DSCs and eliminate the practice of paying trailer fees to discount brokers — but Ontario is only on board with the action on trailers.

Specifically, the CSA said that it intends to ban the payment of upfront sales commissions from fund companies to dealers, “which would lead to the end of the [DSC] option and associated redemption fees.”

“The ban on upfront sales commissions from investment funds to dealers will eliminate an incentive for dealers to recommend investment products that provide them with an upfront commission from the fund company, instead of recommending other suitable investments that have lower costs and do not have redemption fees,” the CSA said in a notice spelling out its plans.

Ontario’s government, which opposes a ban on DSCs, will not be enacting the change in that province.

Instead, the the Ontario Securities Commission (OSC) said in its own notice that it’s continuing to consider alternatives to an outright ban, such as placing restrictions on the use of DSCs to “mitigate negative investor outcomes.”

Possible restrictions include banning DSC sales to seniors; limiting redemption fee schedules; banning leveraged DSC sales; setting account-size limits; and allowing hardship exceptions from redemption penalties.

In the meantime, the OSC will be joining the rest of the CSA in banning the payment of trailers to discount brokers.

“The ban on trailing commissions to certain dealers will end the charging of fees for advice that those brokers do not provide,” the CSA said.

The planned rule changes banning upfront sales commissions will be published in early 2020, and the changes banning the payment of trailers to discounters will be published later in the year.

“These expected rule changes, together with new conflict-of-interest rules that are being implemented under our Client Focused Reforms, will bring greater transparency to the fees paid by investors when they buy mutual funds,” said Louis Morisset, chair of the CSA and president and CEO of the Autorité des marchés financiers, in a statement.

The regulators said that they expect both bans will have a transition period of at least two years.

Once the planned DSC ban takes effect, fund firms will not be allowed to make new sales using the DSC option, the CSA said. The redemption schedules on funds sold via DSC before the ban is adopted will be allowed to run their course.