The Investment Industry Regulatory Organization of Canada has published two sets of proposed rules for comment as part of its project to re-write its rulebook in plain language.

On Friday, IIROC released notices summarizing proposals for changes to rules dealing with clients and changes to financial and operational rules.

including rules dealing with suitability, sales practices and complaint handling.

In addition to simply translating the rules into plain language, the proposals include some substantive revisions that eliminate unnecessary provisions, clarify IIROC’s expectations, ensure the rules reflect actual IIROC practices, and ensure consistency with other IIROC rules and securities legislation.

Some of the changes to rules dealing with clients include clarifying that suitability obligations require dealers to consider not just the suitability of a specific security, but also the account type, trading strategy, order type and the method of financing the trade.

The proposals also includes a new requirement for dealers to provide a commission fee schedule, or schedule of other advisory fees, to their clients upon account opening; and to give 60 days notice of any change to the commission charge.

Another revision deals with requirements for client account statements, clarifying IIROC’s expectation that a dealer must provide certain minimum information on an account statement. It will also set out the regulator’s expectations regarding the provision of consolidated account statements.

IE