This guidance relates to IIROC’s continuing education program (CE Program) which is a requirement for certain Approved Persons under our Continuing Education Rules (CE Rules)1 .This guidance is effective as of January 1, 2020.
Proficiency is a cornerstone of the IIROC regulatory scheme. High proficiency standards play a key role in investor protection and the integrity and efficiency of capital markets. IIROC’s goal is to create, maintain and promote high proficiency standards and a robust proficiency regime in the investment industry.
IIROC developed the CE Rules and this guidance based on the following policy objectives:
- Our commitment to high standards of proficiency and ethics
- Reinforcement of the Conduct and Practices Handbook Course (CPH) as the cornerstone of our proficiency platform
- Encouragement of ethics training, and
- Modernization and simplification of the CE Program.
We believe that an effective CE Program follows three guiding principles:
- Continuing education (CE) is meant to build on and enhance baseline licensing proficiencies
- CE should be relevant, with its parameters determined using a broad and principles-based approach, and
- CE should be timely and ongoing, which includes having some CE in each cycle.
This guidance outlines our expectations and requirements applicable to all Dealer Members and continuing education participants (CE Participants).
The guidance provides IIROC’s views on how the CE Rules should be applied and interpreted. All rule references in this guidance are to the CE Rules unless otherwise noted.
The Continuing Education Program
Continuing Education Program Overview
To help approved individuals who deal with the public remain current on industry and regulatory developments, IIROC introduced a mandatory CE Program. The CE Program operates on two-year cycles (CE cycle). CE cycles will start and end at the same time for all CE Participants.
Individuals approved to do retail business and give advice and their Supervisors are required to complete a minimum of 10 hours of Compliance courses and 20 hours of Professional Development (PD) courses. Those who are not approved to do retail business (who deal with institutions only) and those not registered to give advice (e.g. Investment Representatives and Designated Supervisors) are required to complete ten hours of Compliance courses.
Rule 2654(1) lists the CE Requirements by Approved Person category.
As set out in Rule 2651(1), the goal of CE is to enhance and further develop an individual’s baseline licensing proficiencies.
Baseline licensing proficiencies refer to the body of knowledge and competencies needed on day one to conduct the regulated activity. This includes a firm’s policies and procedures and the contents of the Dealer Member’s compliance manual. CE is meant to build upon these fundamentals.
Based on this principle, the Canadian Securities Course (CSC), CPH, and 30 or 90 day Training Programs do not satisfy the CE criteria and will not qualify for CE credit.
Rule 2653(1)(i) sets out the requirements for the Compliance course. A Compliance course must fall within at least one of the following three major topic areas:
- Ethical issues
- Regulatory developments, and
- Rules governing investment dealer conduct.
Refer to Appendix A for a list of suggested topics that satisfy the Compliance course requirement.
Professional Development Course
Under Rule 2653(1)(ii), all training that fosters learning and development in areas relevant to investment dealer business may qualify for CE credit. This includes PD training that is part of a Canadian or foreign course. It also means an individual could take courses in preparation for and advancement of his or her professional growth and development in future roles. The PD guidelines, found in Appendix B, detail broad topics for consideration when choosing a PD course.
IIROC’s Course Accreditation Process
In accordance with Rule 2653(3), the Dealer Member or external course provider may provide CE courses. Rule 2653(4) provides that Dealer Members or external course provider may accredit their CE courses through IIROC’s accreditation process.
IIROC has retained Continuing Education Course Accreditation Process (CECAP) to assess courses submitted by Dealer Members or external course providers and make recommendations to IIROC on the courses’ suitability for CE credits.
The list of accredited courses can be found here.
Dealer Members or external course providers interested in using IIROC’s logo for marketing or program materials, course certificates, etc. must contact Public Affairs at [email protected] for approval.
For a summary of the accreditation process, please see Appendix C to this guidance.
Grandfathering - Exemption from part of the Continuing Education Program
Individuals approved as a Registered Representative or Supervisor and in a trading capacity for ten years or more as of January 1, 2000 are grandfathered, or relieved, from the requirement to complete the PD course requirement. These individuals are required to complete only the Compliance course requirement of the CE Program.
To maintain his or her grandfathering status, an individual may not have a break in approval of more than 90 days. Former Approved Persons who voluntarily participate in IIROC’s CE Program will not regain their grandfathering status upon reapproval.
The requirement is found in Rule 2653(5).
CE Participants cannot claim CE credits for the same CE course if they have completed the course before, unless the course contains new course content2 . A change in the name or date of the course alone from one year to the next year would not be sufficient and does not qualify as new course content.
The Continuing Education Program and Continuing Education Requirements
Meeting Continuing Education Requirements
CE Participants can meet their CE requirements by successfully completing:
- a Dealer Member delivered Compliance or PD course
- a Compliance or PD course from an external course provider, or
- a Compliance or PD course accredited through IIROC’s accreditation process.
In some circumstances, certain alternate activities may qualify as CE. See the Alternate Activities guidelines attached as Appendix D for the list of qualifying activities.
A CE Participant may be approved in more than one Approved Person category. IIROC requires CE Participants to complete the CE requirements of the category with the more onerous requirements. For example, where an individual is approved as a Designated Supervisor and Registered Representative, IIROC will require the CE Participant to complete both the Compliance and PD course requirements of the Registered Representative category.
Individuals under suspension at the end of a CE cycle, are still required to meet CE requirements. These individuals will be required to complete CE requirements prior to reinstatement. Dealer Members employing individuals under suspension, who have not met their requirements will be subject to the penalties described in Section 10.
Compliance course credits cannot be used to meet the PD course requirement, and vice versa.
Recognition of Continuing Education Requirements of other Regulated Platforms
Because our CE Rules recognize a broad range of Compliance and PD training topics, individuals are allowed to use courses offered by other regulated platforms and organizations for CE credit if the course meets requirements of Rule 2653. For example, a CE Participant that completes a course to meet the continuing education requirements of another regulated platform , such as financial planning or insurance, may also use that course towards their CE requirements under IIROC’s CE Program.
Continuing Education Program Courses and Administration – The Compliance Course
Dealer Member Compliance Manual Training
There is a broad spectrum of approaches taken by Dealer Members to CE to fulfill Compliance course requirements. Many Dealer Members develop compliance courses customized to their firm’s business, the employee conduct desired by the firm and issues and developments the Dealer Member wishes to focus on. IIROC views this as valuable CE.
Following the principle that CE enhances and further develops an individual’s baseline licensing proficiencies, in circumstances where the Dealer Member is using its compliance manual as a basis of CE, in order for that training to be eligible for CE credit, we require that the compliance manual training will expand on the content in the manual and will cover ethical issues, regulatory developments and rules governing investment dealer conduct. IIROC will recognize compliance manual training delivered by the Dealer Member through in-person seminars, or webinars that are accompanied by a method of evaluation. Reading the compliance manual does not qualify for CE credit.
Continuing Education Credit for Foreign Compliance Courses
Under Rule 2655(1)(iii), five hours of a CE Participant’s Compliance course requirement may consist of continuing education compliance courses offered by a foreign securities dealer or foreign external course provider.
For example, a CE Participant may use the Regulatory Element of the Financial Industry Regulatory Authority’s (FINRA) continuing education program to satisfy five hours of his or her Compliance course requirement.
The CE Rules seek to encourage development of ethics training resources by Dealer Members and external course providers and to encourage CE Participants to take ethics courses.
As such, Rule 2655(3) permits CE Participants to repeat and receive credit for ethics courses in two CE cycles. The ethics course does not need to be repeated in two consecutive CE cycles.
IIROC will publish a list of ethics courses that can be repeated for CE credit. The list will be available on our website.
Dealer Members and external course providers should review the ethics course guidelines attached as Appendix E, which outlines the process when seeking approval for such courses.
Continuing Education Program Courses and Administration – The Professional Development Course
In some instances, PD courses taken in one CE cycle may be used to satisfy the PD course requirement in the following cycle, or “carried forward”.
IIROC recognizes that CE Participants may have opportunities to take a meaningful course at the end of a CE cycle after they have completed their CE requirements.
Once a CE Participant has completed his or her PD requirement, they may complete an additional minimum 20-hour PD course and carry forward 10 hours of this course into the next CE cycle.
Carry forwards should be limited to extensive and material training. To qualify, the PD course must have been completed in the last six months of the CE cycle.3
Wealth Management Essentials Course
The Wealth Management Essentials Course (WME) is the post-licensing requirement for individuals approved as Registered Representatives dealing with retail clients.
Where a CE Participant completes the WME to satisfy his or her post-licensing requirement, the course may also be used to fulfill the PD course requirement.
The WME cannot be carried forward and has to be used in the CE cycle it was completed.
Dealer Member Administration of the Continuing Education Program
Reporting and Record Keeping Requirements
Rule 2657(1)(vii) requires Dealer Members to notify IIROC of its CE Participants’ CE completions within ten business days after the end of the CE cycle. Dealer Members are required to update this information in IIROC’s CE reporting system located in IIROC Services. Dealer Members also have the option of reporting CE completions, at any time, throughout the CE cycle if they choose for operational efficiency.
IIROC does not require Dealer Members to report details of the individual courses completed by CE Participants, however, Dealer Members must keep evidence and verify their CE Participants’ successful completion of the CE courses.4 This may take the form of course certificates or notices of completion issued by the internal or external course provider.
As part of its audit process, IIROC may audit a firm’s CE records to ensure compliance with the CE Rules. Dealer Members must retain CE records for seven years.5
Dealer Member Program
Dealer Members are required to ensure that its CE Participants’ chosen CE courses comply with the Compliance course and PD course requirements found in Rule 2653.
Dealer Members should establish internal procedures for assessing internal and external CE courses for CE credit. The courses should be evaluated using the Compliance course and PD course requirements, and corresponding guidelines found in the Appendices to this guidance as reference.
Dealer Members must designate an individual responsible for supervising training and approving a CE Participant’s chosen CE course.6 We do not require this individual be approved as a Supervisor, unless the individual performs other activities which require them to obtain IIROC approval as a Supervisor.
Below is a suggested process when a Dealer Member is establishing its own CE courses:
- Identify training needs including:
- Knowledge and skills, which would impact positively on the Dealer Member and CE Participants, and
- Learning objectives expected from the program or course.
- Identify the evaluation method or methods to be used.
We do not require Dealer Members use a specific method of evaluation or testing for CE courses. However, Dealer Members should choose an evaluation method that is appropriate given the course’s delivery method and learning objectives. Examples of an appropriate evaluation method can include:
- examination or quiz,
- course work,
- case study, or
- workshop participation.
- Determine how successful completion is to be ascertained.
Dealer Members are required to evaluate CE Participants’ knowledge and understanding of the course. Dealer Members should use their judgement to determine what constitutes successful completion of an internally delivered CE course. Examples can include the following:
- If the course includes an examination, the CE Participant would need to successfully complete that examination. The Dealer Member may require the CE Participant to correctly answer a minimum number of questions on the examination to be deemed successful.
- For a lunch and learn, the Dealer Member may consider requiring the CE Participant to sign in, be actively participating, and stay for the whole session, before the Dealer Member issues the CE Participant a certificate of attendance.
- For a webinar, the Dealer Member may consider requiring the CE Participant solve a problem or complete a case study online prior to receiving a certificate of completion.
- Identify the delivery mechanism or mechanisms:
- Determine the most appropriate delivery method
- Determine which internal experts are capable of providing delivery material, and
- Identify programs or courses that would deliver the skills and knowledge which would meet the firm and CE Participant’s needs.
- Verify desired outcomes.
Dealer Members may want to periodically review their internally delivered courses to see if the course continues to meet its training needs.
Participation in the Continuing Education Program
Participation of Approved Persons
CE should be timely and ongoing. Therefore, pursuant to Rule 2658, an individual will enter the CE Program upon approval in an Approved Person category with CE requirements. Where approval occurs in the last six months of a CE cycle, the individual will be subject to CE requirements in the following CE cycle unless the individual was already subject to CE requirements in the same CE cycle.
Changes during a Continuing Education Program Cycle
Changes to Approved Person Category
Per Rule 2660, a CE Participant that changes Approved Person categories during a CE cycle is required to complete the CE requirements of his or her new Approved Person category.
If the change in category occurs in the last six months of the CE cycle, the CE Participant will complete the CE requirements of his or her current approval category. Where a change in the last six months is from a category with both Compliance and PD course requirements to one with only Compliance course requirements, the Dealer Member must provide IIROC with a letter explaining the reason for the change.7
Similarly, if a CE Participant changes back to a category with both Compliance and PD course requirements within the first six months of the next CE cycle, we will require a second letter of explanation.
All letters should be sent from either the firm’s Chief Compliance Officer or the CE Participant’s Supervisor.
Voluntary Participation in the Continuing Education Program
Rule 2659 of the CE Rules outlines the parameters of voluntary participation in IIROC’s CE Program. IIROC allows certain individuals to voluntarily participate in its CE Program. Voluntary participation is available to individuals who were previously approved by IIROC in an Approved Person category and who are no longer approved.
Individuals who voluntarily participate in the CE Program may extend the validity period of the CSC until June 30th of the first year of the next CE cycle. Individuals can avoid rewriting a lapsed CSC by taking a course or courses on the list of approved courses for voluntary participation. Voluntary participation may be used to extend the validity of the CSC for one CE cycle only.
IIROC determines which courses are available for voluntary participation. The course list is available on IIROC’s website.
Courses on the list have the following characteristics:
- They either refresh or build upon the course content in the CSC
- Courses are a minimum of 20 hours and a PD course
- They include a learning evaluation process such as an exam or case study, and
- The internal or external course provider has provided proof of successful completion.
We are reevaluating the courses on this list. During this review, there may be a period of time where there are limited courses on this list or no additional courses added. In addition, an individual may have to complete one or more than one course on this list to demonstrate equivalency and maintain the validity of the CSC.
Extensions to complete CE Requirements
A Dealer Member may seek (on behalf of a CE Participant) an extension to complete his or her CE requirements. Extension requests should be supported by reasons indicating the nature of the hardship faced for IIROC Staff consideration, and include a proposed extension time.
Generally, IIROC will support extension requests that are equivalent to the length of the CE Participant’s absence (up to six months). Extensions greater than six months, or for a period longer than the CE Participant’s absence may be granted in limited situations. All requests are decided on a case-by-case basis.
Extensions may be requested in circumstances where an individual is on a definite leave of absence or is not on leave, but has nonetheless faced a hardship during the CE cycle.
Any extension granted will not result in additional time being given to the CE Participant for completion of his or her CE requirements in the following CE cycle. That is, if the individual faces a hardship in completing the next CE cycle’s requirements, this would be a separate request and a separate submission.
Exemptions from completing CE Requirements
A Dealer Member may seek (on behalf of a CE Participant) an exemption from CE requirements where the CE Participant is on an indefinite leave of absence.
Exemption requests should be supported by reasons indicating the nature of the hardship faced for IIROC Staff consideration. Submissions are reviewed on a case-by-case basis.
Penalties for Not Completing Continuing Education Requirements
Penalties for Late Filings and Non-Completions of CE Requirements
CE Participants must complete their CE requirements by the end of the CE cycle.8 Under the CE Rules, Dealer Members must update the CE reporting system and notify IIROC within 10 business days after the end of a CE cycle of all CE Participants that have met their CE requirements for that CE cycle.9
We will generate a report for each Dealer Member which will show which CE Participants at the Dealer Member have not completed their CE requirements (the CE Deficiency Report). We will provide the CE Deficiency Report to Dealer Members and inform their CCOs and Authorized Firm Representatives (AFRs) that CE Participants on the CE Deficiency Reports face potential suspension if they do not complete their CE requirements.
We expect Dealer Members will check the CE Deficiency Reports and verify with their records to see who has or has not completed their CE requirements. Where a CE Participant has not completed their CE requirements, we expect the Dealer Member to contact those individuals to inform them that if they do not complete their CE requirements and report their CE completions to the Dealer Member, they will face suspension on the last business day of the first month following the applicable CE cycle. For example, for CE cycle 7 ( which runs from January 1, 2018 to December 31, 2019) the last business day of the first month following CE cycle 7 is January 31st , 2020.
During the month of January, we will proactively review and monitor the outstanding CE Deficiency Report and work with the Dealer Members whose CE Participants appear on the CE Deficiency Report.
Starting January 1, 2020, we will impose the following penalties for late filings and non-completions of CE requirements:
- $100 fee for each business day of non-completion of CE or late filing of CE for each CE Participant; IIROC will begin to impose this fee 10 business days after the end of the CE cycle. This daily fee will continue until the Dealer Member reports to IIROC the CE Participant’s completion of his or her CE requirements, or until the last business day of that month, whichever is later, and
- If on the last business day of the first month of a CE cycle, the Dealer Member has not reported the required completion of the CE Participant’s CE requirements, we will suspend the CE Participant’s approval. The CE Participant will be required to cease all registerable activities immediately upon suspension.
Request to lift suspension
Once a suspended CE Participant completes their CE requirements, they may request reinstatement of IIROC approval.
To initiate this process, we ask that the Dealer Member notify their IIROC Registration Manager or Senior Registration Officer in writing by email that the CE Participant has completed their CE requirements and requests removal of the suspension. We may request supporting documentation such as proof of completion of any CE courses prior to lifting the suspension.
Guidelines for the Continuing Education Program
IIROC provides guidelines for its continuing education program to assist individuals and Dealer Members understand and comply with the CE Rules.
These guidelines have been developed to provide flexibility to Dealer Members and CE Participants.
Below are guidelines for the following elements of the CE Program:
- Appendix A – Compliance Course
- Appendix B – Professional Development Course
- Appendix C – Continuing Education Course Accreditation Process
- Appendix D – Alternate Activities
- Appendix E – Ethics Course