I spend each winter down south. Why can’t my dealer in Ontario process any trades for me while I’m away?
Under securities law, a dealer must be registered in the jurisdiction where the client is sending the instructions. For example, if you are in Florida, your dealer in Ontario can’t buy or sell securities for you unless they are registered with the United States Securities and Exchange Commission (SEC) and with the Florida State Office of Financial Regulation.
The SEC allows limited exemptions in certain circumstances. However, not all state regulators have adopted these exemptions and some have adopted them differently.
Meeting the various state registration requirements can be complicated for Canadian dealers and advisers. As a result, many have decided not to seek registration outside the provinces where they usually do business. In addition, many will not provide service to clients who are in another jurisdiction, even if that other jurisdiction has an exemption to the registration requirements.
Issues relating to registration and jurisdiction are complicated and vary greatly depending on the circumstances. Contact the OSC for help understanding how the regulations may apply in your case.
Before heading south, you should also contact your dealer or adviser to discuss any requirements while you’re away.