Do you ever find yourself nodding off or scrambling for a dictionary while wading through regulatory rules? Good news: IIROC has released for comment its plan to rewrite its rules in plain language.

“The primary objective of this project is to develop a set of rules that is more clear, concise and organized, without changing the rules themselves,” the notice reads. “In addition we have identified a number of rules that also require substantive revisions.”

Specifically, the regulator plans substantive revisions of the following: Rule 1100, Interpretation; Rule 1200, Definitions; and Rule 1400, Standards of conduct. These are being rewritten to ensure clarity consistency with other rules and existing practices.

The regulator promises that these revisions will “not create any new obligations for Dealer Members and have been drafted to clarify the existing rules with respect to rule interpretation, definitions, powers of the Corporation and standards of conduct.”

Rule 1100

There are two substantive changes to the Interpretation rule.

First, the proposed Rule 1100 specifies that if a Corporation requirement requires a person at a Dealer Member to perform a function, unless specifically prohibited, that person may delegate the tasks or activities involved in performing the function but not the responsibility.

The proposed Rule will also codify the current practice of allowing electronic or digital signatures for an agreement, contract or transaction, unless specifically prohibited.

“Although many sections are categorized as new in proposed Rule 1100, the concepts discussed within these provisions are not new. These concepts already exist within the current Dealer Members rules.

Rule 1200

Any terms not defined in proposed Rule 1200, which are defined in securities legislation, have the same meaning as defined in the relevant Securities Act, Rule, Regulation or National Instrument and other similar document.

Rule 1400

Proposed Rule 1400 will include the following sections:

• Introduction, Standards of conduct and Applicability: The text of these sections will be proposed through a separate project, the Consolidated Enforcement Rules.

• Policies and procedures: Consistent with current practices and expectations, proposed Rule 1400 will clarify that:

  • if a Corporation requirement mandates a Dealer Member to establish policies and procedures, those policies and procedures must be sufficient to meet the Corporation’s objectives and that the Dealer Member may establish more stringent policies and procedures; [1404(1)]
  • guidelines provided by the Corporation, unless otherwise indicated, are intended to be acceptable compliance methods and that Dealer Members may use alternate methods to comply with the Corporation requirements; [1404(2)] and
  • the Corporation may require a Dealer Member to adopt additional or different policies and procedures if the Corporation considers the Dealer Member’s existing policies and procedures to be insufficient. [1404(3)]

• Evidence of compliance with the Corporation requirements: Consistent with the current practices and expectations, as well as the provisions set out Dealer Member Rule 19 Examinations and Investigations, proposed Rule 1400 will specify that the Corporation may require a Dealer Member to provide it with evidence, satisfactory to the Corporation, of the Member’s compliance with the Corporation requirements. [1405]

Read the IIROC Notice.