(October 13 – 14:40 ET) – The Ontario Securities Commission has delivered its rule making membership in the Mutual Fund Dealers Association mandatory on January 1, to the Ontario finance minister for final approval.

There have been a few changes made to the rule. Dealers are being given 75 days after the MFDA is recognized to apply for membership. Originally they were only allowed 30 days. The rule will require all mutual fund dealers registered with the OSC to become members of the MFDA within one year, and 75 days after the date of recognition. Dealers will be required to apply to the MFDA with the MFDA’s prescribed fees within 75 days.

The OSC says mutual fund dealers should begin to plan for the effective date and the requirements of the rule immediately. If the commission recognizes the MFDA as a self-regulatory organization for mutual fund dealers, the requirements for dealers are imposed from the date that the commission recognizes the MFDA. This is now expected by mid-January.

If the minister does not reject the rule or return it to the commission for further consideration by December 11, or if he approves the rule or does nothing, it will come into force on January 1, 2001. This rule is the only element of the MFDA that requires ministerial approval, the commission itself can has the power to recognize the MFDA.

Comments received on the MFDA Recognition Package will be summarized by the MFDA and revisions to the rules and by-laws of the MFDA are expected to be made in response to those comments. The OSC has asked the MFDA to provide a full accounting of the comments and its responses to those comments as part of its revised application for recognition to be delivered to the OSC during the fall of 2000.
-IE Staff