Questions continue to swirl around the ramifications of the national Do Not Call List (DNCL), and just how financial advisors will be affected once it is put in place.

“The jury’s out on how it’s going to be interpreted,” says Rick Johnson, director of practice advisory services at Advocis in Toronto. No conclusions can be drawn until the administrator of the list is in place, he adds. One thing that seems clear, however, is that advisors will not be able to cold-call prospects who are included on the list.

“You can kiss cold-calling goodbye,” Johnson says.

The Canadian Radio-television and Telecommunications Commission announced in a July decision that it was setting out rules to create and operate a national DNCL for Canadians who want to avoid receiving unsolicited calls. The rules will come into effect once an independent operator is chosen and the list is fully operational. There’s still no word on exactly when that will be, but observers anticipate that it won’t happen until sometime in 2008 — at the earliest.

Under the national DNCL, individuals who specifically indicate that they prefer not to receive unsolicited calls will be able to add their numbers to the database. There is a list of exemptions, including registered charities, general-circulation newspapers, political parties and businesses that have an existing relationship with the person being called.

The intent behind the legislation is to protect consumers from receiving uninvited and, in some cases, irritating telemarketing calls.

It is not known how the list will be accessed or how much businesses will have to pay to make sure they don’t call numbers on the list. “It’s not clear how the DNCL operator is going to be funded,” says Sara Gelgor, vice president of regulatory affairs at Advocis, “whether there will be seed capital put up by the government, or whether there will be charges per access-point usage.” One possibility is that fees to register will be paid, even if someone might not be using the list.

Violations could incur financial penalties of up to $1,500 for individuals and up to $15,000 for corporations.

The issue of referrals that have not been sanctioned by the person receiving the call is also unclear. When being referred to a prospective client, the advisor will not be able to call the prospect unless that prospect is aware that the advisor is going to call.

“There could be implied consent,” says Johnson, “but that hasn’t been fleshed out. The way the legislation is written, as I understand it, I would need to get express consent from the [prospective] client before I’d be able to call if he or she happened to be on the list.”

Of course, if the prospective client isn’t on the list, it’s not an issue. As well, if an advisor meets a prospective client at a party and indicates that the advisor would like to call the prospect about a business relationship and the client says, “Yes, call me,” that would be considered an exempt call because the prospect has given permission.

Although most experienced advisors do not cold-call and have developed a business through a referral network, the rules could be tough on new advisors trying to drum up business. “They may end up having to develop their business by buying existing books instead of building it themselves,” says Johnson.

While some issues surrounding the registry are still being worked out, certain other issues have been clarified. In oral and written submissions to the CRTC, Advocis strongly argued against having the rules apply to situations in which a book of business has been bought by an advisor.

The CRTC agreed, so that will be exempt from the regulations. Once the ownership has been transferred, Johnson says, “The advisor now has a business relationship with these clients, even though he or she may not have met them, so the advisor has a legitimate reason to be calling.”

The feedback Johnson has received so far indicates that advisors are concerned about the DNCL. But, he says, “We’re not able to provide them with the kind of direction that they need until we have a better understanding of who the administrator is and how it is going to interpret the rules.”

For now, he’s telling advisors to follow the process they’re currently using, with the understanding that it’s going to get clarified later. He suggests they work on a referral process as recommended in the Advocis Best Practices Manual.

@page_break@“Until the administrator gets up and running, it’s just completely open to interpretation,” he says. IE