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Regulators propose amendments to ban DSC commissions

By The IJ Staff | September 13 2018 01:30PM

Louis Morisset, CSA chairman.

The Canadian Securities Administrators today published proposed amendments that would ban all forms of the deferred sales charge option (the DSC option) and trailing commissions to dealers who do not make a suitability determination, such as order-execution-only dealers.

“These changes would result in the discontinuation of all forms of the deferred sales charge option (the DSC option), and more transparent fees on the discount brokerage channel,” said the CSA in a statement issued Sept. 13.

The proposed amendments follow the June 21 publication of the CSA’s policy decision on embedded commissions and its proposed Client Focused Reforms.

"These proposed amendments, together with enhanced registrant conduct requirements proposed under our Client Focused Reforms, comprise the CSA's policy response to the investor protection and market efficiency concerns examined in our consultations on embedded commissions," said Louis Morisset, CSA Chair and President and CEO of Quebec’s the Autorité des marchés financiers (AMF).

The proposed amendments are available on CSA members' websites. The comment period will close Dec. 13, 2018.

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