IIAC recommends further regulatory development to facilitate eDeliveryBy Kate McCaffery | May 27 2019 11:30AM
Online delivery of documentation has taken over paper documents and regulators have responded positively by amending existing regulations to allow for eDelivery of certain documents to retail investors, but further steps are needed says Investment Industry Association of Canada (IIAC) president, Ian Russell.
In his latest president’s letter, Russell says in the past five years regulators have amended existing national policies to facilitate electronic delivery of electronic proxy voting for retail investors. Amendments provide a regulatory framework for eDelivery, including the removal of a requirement to collect consent using specific documents. An increase in the use of eDelivery also occurred when investment advisors were allowed to access fund facts and other documents and deliver them electronically to their clients.
“Surprisingly, regulatory framework has proven rapidly adaptive in responding to eDelivery,” he writes. “The Canadian Securities Administrators deserves credit for its far-sighted approach to cooperating with issuers and investment dealers to facilitate eDelivery of documents and proxy voting.”
Despite changes, he points out that the approval process to onboard clients to eDelivery remains complex and obtaining permissions is sometimes difficult. “Regulators should consider more user friendly mechanisms for investors to confirm consent for electronic disclosure, perhaps requiring a simple email or verbal responses directly to the advisor, avoiding the complicated process of requiring the client to select (check-off) items for eDelivery,” he writes. He also suggests that regulators could consider allowing a “notice and access” approach – where clients are notified by email and given hyperlinks to prospectuses – sufficient to constitute prospectus delivery.