Permissible Activities for those taking the 30 and 90‑Day Training Programs

GN-2600-21-009
Type: Rules Notice> Guidance Note
Rule connection:
IIROC Rules
Distribute internally to:
Legal and Compliance
Registration
Senior Management
Training

Contact:

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Executive Summary

Effective Date: December 31, 2021

Applicants seeing approval in the category of Investment Representative or Registered Representative dealing with retail clients must complete a training program while employed with the sponsoring Dealer Member (Dealer) before applying.

The training program must be at least 30 days for those applying as Investment Representatives and at least 90 days for those applying as Registered Representatives.

This Guidance sets out our expectations on the “no client contact” during the training programs.1

  • 1In this guidance, all rule references are to the IIROC Rules unless otherwise specified.
  1. Permissible Activities

  • Gather information from existing or prospective clients on behalf of another Registered Representative, including assisting clients with inquiries about their accounts and giving quotes, provided that individuals do not open any client accounts until they are fully registered.
  • Contact the public, including sending out introduction letters, inviting the public to firm seminars, and forwarding non-securities specific information, provided that they comply with the restrictions below under impermissible activities.
  • Create and research lists of potential clients for future follow-up work.

Dealers may also reference subsection 2216(16) which provides further information on activities that non-registered personnel may provide.

  1. Impermissible Activities

Dealers must ensure that the candidates in either the 30 or 90-day training program do not engage in any activities requiring approval.  This means that applicants in the training program are not permitted to have contact with clients or prospective clients in obtaining, taking or soliciting orders for or advising on trades in securities, as they are not yet registered.  Furthermore, such applicants must not receive commission splits as any part of their compensation. In addition, applicants cannot:

  • Provide any recommendations, opinions or advice with respect to securities as defined in provincial Securities Acts, either in writing or verbally.
  • Open client accounts.
  • complete know-your-client information on a New Account Application Form or Know Your Client form other than the biographical information at the beginning of the form completed on behalf of a registered representative.2
  • Distribute under their own names research reports to clients or prospective clients containing security-specific comments, recommendations or opinions.  However, they can, act on behalf of one or more Approved Persons, distribute literature including research reports provided such literature is approved for distribution by the Dealer and/or the designated Supervisor.
  • Solicit, accept or process any orders, including unsolicited orders.

Dealers may may also reference subsection 2216(15) which provides further information on activities that non-registered personnel may not provide.

Registered Representatives (Mutual Funds only) on the IIROC platform may continue to deal with existing and new mutual fund clients only during the training program.  It is IIROC’s expectation however that individuals are devoting real and meaningful time to the training during this period and their ongoing work is not interfering with or overtaking the required training.

  1. Applicable Rules

IIROC Rules this Guidance Note relates to:

  • section 2553,
  • Rule 2600, and
  • section 2216.
  1. Previous Guidance Note

This Guidance Note replaces MR057 – Permissible Activities for those taking the 30 and 90 Day Training Programs required under Policy 6, Part 1.

  1. Related Documents

This Guidance Note was published under Notice 21-0190 - IIROC Rules, Form 1 and Guidance.

 

  • 2Rule 2157(17) permits, in a shared office premise, a manager, assistant manager or credit officer of the financial services entity who has a high degree of knowledge about the client’s financial affairs may help the client to complete the New Account Application, if (i) no Approved Person is available, (ii) the client’s Registered Representative, Portfolio Manager or Associate Portfolio Manager complies with IIROC requirements relating to know-your-client and suitability by reviewing the New Account Application with the client before any trade is conducted or a recommendation is made to a client, and (iii) a Supervisor has approved the New Account Application before any trade is conducted for a client.