A brokerage firm has been granted an exemption to allow reps that are dually licensed with its Canadian subsidiary to deal with institutional clients, and through its U.S. affiliate’s exempt market dealer (EMD) registration, to now also serve retail clients under the Canadian investment dealer registration.
According to a decision published in the latest OSC Bulletin, the Ontario Securities Commission (OSC) has allowed an amendment to previous exemptive relief that was granted to Credit Suisse Securities (Canada), Inc. (CCSC) and Credit Suisse Securities (USA) LLC (CCSU), allowing the firms to have up to 20 reps that are dually registered with both firms. Currently, CSSC is registered as an investment dealer, but is restricted to dealing with institutional customers, and CSSU is registered as an EMD and relies on the international dealer exemption.
Now, CSSC is in the process of expanding its services to retail customers, the decision notes. So, the firms applied for an amendment to the earlier relief to allow the dually registered reps to also deal with retail clients “provided that they act solely in the capacity of registered individuals of the investment dealer” when they do so.
“To the extent any of the registered individuals of CSSC deal with clients who are retail customers, they will be acting solely in the capacity of a registered individual of CSSC. Registered individuals of CSSC who are also registered individuals of CSSU will only open accounts for institutional customers in the context of the dual registration,” the decision notes.
The decision also orders that the relief will expire either when the Canadian Securities Administrators (CSA) adopt new rules curbing the brokerage activities of foreign EMDs, or at the end of 2015, whichever comes first. “In view of the fact that the proposed amendments … have not yet been published in final form, and may not come into force until late 2014 or early 2015,” the decision notes, the firms requested an extension of the relief.