The Investment Dealers Association board of directors has approved amendments to the IDA’s by-laws regarding proficiency requirements for brokerage firm shareholders.

The amendments are effective immediately, but will not be applied retroactively. The current by-law requires that at least 40% of the board of directors or partners of a firm must satisfy certain proficiency requirements.

The amendment adds that if the remaining members of the board are actively engaged in the securities business, they are also required to have satisfied the applicable proficiency requirements unless an exception is granted.

The by-law does not address the proficiency requirements for individuals who are not partners or directors but are actively engaged in the business of the firm; and, non-industry partners and directors. For both these categories of individuals, proficiency requirements will only be triggered if they beneficially own 10% or more of the voting securities of the firm.