By James Langton

(March 26 – 13:10 ET) – The Ontario Securities Commission is proposing a system of permanent registration.

The idea for a permanent registration system first surfaced in 1998. This latest attempt at a rule is expected to be implemented in all of the jurisdictions of the Canadian Securities Administrators, except B.C., Alberta, Manitoba and Quebec. Although B.C., Alberta and Manitoba are expected to join if the national registration database ever gets off the ground too.

The proposed instrument creates a permanent registration system to replace the current system of annually renewing registration. It requires that on December 15 each year every registered firm will be required to deliver to the regulator an annual registration fee for itself and its registered individuals. If a firm fails to pay its annual registration fee on December 15, the registration of the firm will be suspended on December 31.

Perhaps the most important effect of this new system is that the Director of the commission will no longer have the opportunity to refuse to grant a renewal of registration.

The OSC insists nevertheless that, “implementing a permanent registration system will not diminish the commission’s ability to suspend or terminate registrations. Under a permanent registration system, where staff have determined that a registrant is no longer suitable for registration, staff will continue its current practice of seeking an order … to terminate the registration.”

The OSC suggests that the proposed rule will benefit registrants by harmonizing annual registration fee payment dates. It will also eliminate the administrative costs borne by staff in the process of reviewing applications for renewal of registration. “Staff of the commission has found that renewing registration is largely an administrative process and that concerns with a registrant’s suitability for registration are typically discovered through compliance reviews, enforcement investigations and public complaints.”

Comments are due by June 18, 2001.