IIROC released a consultation paper in December regarding its arbitration program, which was last reviewed in 2011. The program requires investment dealers to participate in binding arbitration to settle disputes upon the request of a client.
The consultation is a response to a number of recommendations that had been made by an independent working group of members of investor advocates, the investment industry and arbitration professionals who reviewed the current IIROC program. IIROC is now seeking feedback from the public on these recommendations, as well as the role of the program and its coexistence with other dispute resolution options. This consultation is open for comment until March 6.
The working group came up with seventeen recommendations – some of them involved changes that could immediately be put in place, but also others would require further public consultation. For example, recommendations that could have short-term implementation included revising program materials to ensure they include plain language, as well as increase public awareness of the program.
Other suggestions from the working group included allowing parties to choose their own arbitrator and establishing shorter timelines for case resolution in appropriate situations. A pilot program was suggested for certain procedural changes, including allowing case management and requiring mediation. Further public consultation would be required for items such as the potential publication of arbitration decisions and an increased award limit.
IIROC (now, together with the MFDA, the New Self-Regulatory Organization of Canada), proposes to maintain the program alongside the dispute resolution services provided by the Ombudsman for Banking Services and Investments (OBSI). It is noted that the arbitration program is not intended to draw away from OBSI, and that it is distinctive from those services. The arbitration program has always been intended to be an alternative to litigation yet focus on complex and large claims. As a result, IIROC is considering having the program operate only for claims above the OBSI limit, except in the Province of Québec.
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