In the Matter of National Instrument 31-103 Registration Requirements and Exemptions, Miller Tabak Roberts Securities, LLC and certain other international dealers

NI 31-103 Registration Requirements and Exemptions (NI 31-103), which came into force on September 28, 2009, does not continue the registration category of international dealer that currently exists in Ontario and Newfoundland and Labrador. NI 31-103 will instead permit activities which are broadly similar to those of an international dealer registrant to be carried out on an exempt basis under section 8.18. It is anticipated that upon the coming into force of NI 31-103, most currently registered international dealers will choose to carry on business under the exemption.

However, the activities permitted under the international dealer exemption are more narrow than those permitted under the former international dealer registration category. In particular, the only debt securities that an international dealer can trade outside of their distribution are debt securities that are foreign securities (section 8.18(2)(c)). This means that registered international dealers who traded debt securities that were not foreign securities outside of their distribution before the Instrument came into effect have to either cease doing so in order to be able to rely on the exemption, or become registered in a category that will permit them to do so (such as exempt market dealer). NI 31-103 does not provide a transition period for current international dealers to become registered in another category. The transitional relief in this decision provides that for a period of one year, persons or companies that were registered international dealers immediately before the coming into force of NI 31-103 will continue to be permitted to trade debt securities that are not foreign securities outside of their distribution.

Persons or companies wishing to carry on business in reliance on the international dealer exemption in section 8.18 are required to provide a prescribed notice to clients. The transition provisions for international dealers in section 16.18 allow them one month in which to provide this notice to existing clients. However, some international dealers will have difficulty in doing so within that time. The transitional relief in this decision provides that for a period of six months, persons or companies that were registered international dealers immediately before the coming into force of NI 31-103 will be permitted to carry on business in reliance on the exemption in section 8.18 without having delivered the prescribed notices to their existing clients.

Full text of the Decision