IFIC supports CIRO’s enhanced cost-reporting requirements, asks for clarification of several key points

January 10, 2025 (Toronto) – The Investment Funds Institute of Canada (IFIC) has responded to the Canadian Investment Regulatory Organization’s (CIRO) Request for Comment – Enhanced Cost Reporting – Proposed Rule Amendments.

“IFIC supports total cost reporting, or TCR, and CIRO’s rule amendment objective to substantially harmonize with the Canadian Securities Administrators’ (CSA) TCR enhancements,” said Andy Mitchell, President and CEO, IFIC. “We are also pleased that CIRO proposes to use a more efficient process to grant exemptions related to clients’ outside holdings, which are those held off book in a client’s name, where applicable.”

While we support CIRO’s overall objective, in our submission we highlight several key areas that need clarification before the final rules are published:

• We appreciate CIRO’s intention to harmonize with the CSA’s TCR enhancements. However, we request that CIRO explicitly clarify that its proposed amendments do not add any new additional requirements beyond the CSA’s TCR enhancements. For example, a requirement to report individual cost totals for each fund held in the year would cause dealers, fund managers, and their service providers to draw on extra resources and face challenges in complying with the reporting requirements by the compliance date.
• We strongly recommend that CIRO clarify its position on existing clients’ outside holdings-related exemptions so it is clear whether they will become void or need to be expanded because of the proposed amendments. If an exemption is to become void or needs to be expanded, CIRO should provide dealers with substantial prior notice so they can plan and implement any necessary systems changes.
• Similarly, we urge CIRO to clarify, with substantial prior notice, for those dealers that will seek exemptions from annual cost reporting of clients’ outside holdings, that the criteria will be the same as the grounds and conditions in similar past exemptions granted by CIRO. Otherwise, dealers risk incurring unnecessary cost and burden.

About IFIC

The Investment Funds Institute of Canada is the voice of Canada’s investment funds industry. IFIC brings together approximately 150 organizations, including fund managers, dealers, professional and back-office service providers, to strengthen the integrity of the investment funds industry, foster public confidence in investment funds, and help enable investors to achieve good outcomes. By connecting savers to Canada’s economy, our industry contributes significantly to Canadian economic growth and job creation.

For more information

Christine Harminc
Senior Manager, Communications and Public Affairs
charminc@sima-amvi.ca
416-309-2313