The Canadian Securities Administrators (CSA) recently published CSA Staff Notice 31-317 Reporting Obligations Related to Terrorist Financing for Registrants, Exempt International Dealers and Exempt International Advisers [available here] regarding monthly reporting obligations and other matters relating to terrorist financing and United Nations Act sanctions on certain countries under the Criminal Code of Canada and related regulations. While the Notice confirms the CSA's view that the reporting obligations apply to registrants and entities relying on the international dealer exemption and/or the international adviser exemption in National Instrument 31-103 Registration Requirements and Exemptions, we understand that these reporting obligations also apply to firms that rely on other exemptions from registration requirements – for example – the exemption from the exempt market dealer registration requirement that is available in the western provinces and territories. We are seeking clarification from the CSA on this point.
The Notice provides
- information on the new consolidated reporting form to be used for all reports filed with principal regulators on and after May 14, 2010
- information regarding the submission of monthly reports including the acceptability of e-mail submissions of reports
- summary information on the Canadian laws which impose the monthly reporting requirements.
There are two types of reporting to their principal regulator required by dealers and advisers that were previously addressed by several CSA jurisdictions in two separate reporting forms. These forms have been revised into a new single CSA consolidated form that should be used by a firm for reporting by e-mail to the firm's principal regulator starting with the reporting due May 14, 2010.
The Notice summarizes the applicable Canadian laws that, among other things, are intended to combat terrorist financing and that permit the listing of persons and entities ("designated persons") in respect of which dealers and advisers must report dealings. A consolidated list of "designated persons" is available on the OSFI website [http://www.osfi-bsif.gc.ca]. We note this list is revised frequently.
These reporting obligations are in addition to the obligations dealers and advisers have under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada).
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.