Cost disclosure, performance reporting and client statements
The Client Relationship Model - Phase 2 (CRM2) amendments to NI 31-103 that came into effect on July 15, 2013 were phased-in over a three-year period. These amendments introduced new requirements for reporting to clients about the costs and performance of their investments, and the content of their accounts. The amendments represent a significant step forward in client communications.
The requirements apply to dealers and advisers in all categories of registration, with some application to IFMs as well. For more information about these amendments, see CSA Notice of Amendments to NI 31-103 and to 31-103CP (Cost Disclosure, Performance Reporting and Client Statements).
On May 21, 2015, the CSA issued parallel orders providing relief from certain of the CRM2 provisions of NI 31-103. A discussion of the relief granted can be found in CSA Staff Notice 31-341 Omnibus/Blanket Orders Exempting Registrants from Certain CRM2 Provisions of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations.
IIROC and MFDA member rules are materially harmonized with the CSA’s CRM2 requirements and were implemented on the same schedule. SRO members who comply with equivalent member rules are exempted from the CRM2 requirements in NI 31-103.
In April 2016, the CSA published CSA Staff Notice 31-345 Cost Disclosure, Performance Reporting and Client Statements – Frequently Asked Questions and Additional Guidance (Staff Notice 31-345). Staff Notice 31-345 replaced two previously published CSA staff notices: Staff Notice: 31-337 Cost Disclosure, Performance Reporting and Client Statements - Frequently Asked Questions and Additional Guidance as of February 27, 2014 and Staff Notice 31-324 Exempt Market Dealers and Account Statement Requirements in National Instrument 31-103 Registration Requirements and Exemptions.
In July 2016, the CSA published proposed amendments to the CRM2 requirements. If adopted, the proposed amendments will make permanent the relief granted by the May 2015 parallel orders, discussed above, and also provide additional staff guidance on the CRM2 requirements. For more information about the proposed amendments, see CSA Notice and Request for Comment – Proposed Amendments to NI 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, Companion Policy 31-103CP Registrant Requirements, Exemptions and Ongoing Registrant Obligations, NI 33-109 Registration Information and Related Forms .