Wealth Up Investments | Your Exempt Market Specialists
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What has changed with the Exempt Market?

In September, 2009, the federal government introduced new legislation to reform the exempt market and also nationalize parts of the Securities Act.  Before this new legislation, each province had its own rules for the trading and business of Exempt Market products.

The new federal regulations were set out in 2009 in order to achieve the following goals:

  • To apply blanket reforms to the distribution of Exempt Market products to investors.
  • To increase and strengthen the standards which helps to manage the risks for investors.
  • To introduce proficiency requirements for both sellers and dealers alike.  This takes weaker players out of the equation if they have minimal experience or can’t be licensed due to past violations.

The federal government achieved these goals through National Instrument 31-103.  This ensures that anyone offering Exempt Market products to clients:

  • Is licensed.
  • Has successfully completed either the Canadian Securities Course, or the specialized Exempt Market Products exam.
  • Is registered with an Exempt Market Dealer.

NI 31-103 also created the “Exempt Market Dealer” which is a new term for most people but now the backbone of the Exempt Market industry.

So to sum up, the new regulations have brought about some very positive changes:

  • They have reformed the way that investment products are distributed to the investor.
  • They have increased the standards of the industry to protect investors and increased the responsibility of the investment dealers.
  • They have driven out those who cannot get licensed due to securities violations.