A merger between two self-regulatory organizations that oversee the country’s investment industry is heading into its final stages of approval as regulators announce the final framework and a new board of directors.
On Thursday, the Canadian Securities Administrators (CSA), an umbrella organization of Canada’s provincial and territorial securities commissions, released the names of proposed board members for the new self-regulatory organization (SRO) that will combine the functions of the Investment Industry Regulatory Organization of Canada, or IIROC, which supervises securities dealers, and the Mutual Fund Dealers Association of Canada, or MFDA, which oversees 90 mutual fund dealers.
The CSA also revealed the names of board members for a new single investor protection fund (IPF) for the industry, and released for public comment several documents outlining the structure of the new organization and fund.
“Today’s announcement of the new boards and publication of draft documents marks a major milestone toward our goal of creating a new SRO and IPF that serves a clear public interest mandate, better protects investors and promotes public confidence,” CSA Chair and CEO of the Autorité des marchés financiers Louis Morisset said in a statement.
The public comment period, which is open until June 27, is one of the final steps in consolidating IIROC and the MFDA, as well as creating one investor protection fund by combining two existing funds — the Canadian Investor Protection Fund (CIPF) and the MFDA Investor Protection Corporation. The fund will be independent from the new organization.
The two SROs have long been criticized by investor advocates and the investment industry for overlapping areas of oversight as more wealth managers serve customers who buy both mutual funds and individual securities. In 2019, the CSA began to review the “regulatory framework” that governs both the IIROC and the MFDA and, after industry consultations and several proposals, a new SRO plan was formed.
The new yet-to-be-named SRO is expected to be completed by Jan 1, 2023.
The proposed organization will have a governance structure, similar to the current governance structure of IIROC and the MFDA, and will initially include investment dealer and mutual fund dealer registration categories as well as marketplace members.
The potential to incorporate other registration categories – such as exempt market dealers and portfolio managers currently overseen directly by members of the CSA – will be considered as part of a separate phase.
The proposed framework plans to eliminate duplicative costs and minimize regulatory inefficiencies; promote access to advice for all investors; reduce investor confusion; streamline the complaint process; increase controls and improve transparency of enforcement mechanisms; and enhance market surveillance, among other measures.
The proposed board for the new SRO will consist of 14 members, with a majority of them independent directors – including new chair Tim Hodgson, a former financial services executive who presently serves as the Chair of Hydro One. The new SRO’s chief executive officer, who will be the final member of the board, is expected to be named in “coming weeks,” said the CSA in a release.
The new IPF board will also consist of 14 members – including new chair Donna Howard, current CIPF director and chair and vice-chair Dawn Russell, current MFDA IPC director and Chair. The new IPF’s chief executive officer, who would be the final member of the board, is expected to be named in the third quarter of calendar year 2022.
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Tense diplomatic relations may not impact trade, investment ties between India, Canada: Experts
NEW DELHI: The tense diplomatic relations between India and Canada are unlikely to impact trade and investments between the two countries as economic ties are driven by commercial considerations, according to experts. Both India and Canada trade in complementary products and do not compete on similar products.
“Hence, the trade relationship will continue to grow and not be affected by day-to-day events,” Global Trade Research Initiative (GTRI) Co-Founder Ajay Srivastava said.
Certain political developments have led to a pause in negotiations for a free trade agreement between the two countries.
On September 10, Prime Minister Narendra Modi conveyed to his Canadian counterpart Justin Trudeau India’s strong concerns about the continuing anti-India activities of extremist elements in Canada that were promoting secessionism, inciting violence against its diplomats and threatening the Indian community there.
India on Tuesday announced the expulsion of a Canadian diplomat hours after Canada asked an Indian official to leave that country, citing a “potential” Indian link to the killing of a Khalistani separatist leader in June.
Srivastava said these recent events are unlikely to affect the deep-rooted people-to-people connections, trade, and economic ties between the two nations.
Bilateral trade between India and Canada has grown significantly in recent years, reaching USD 8.16 billion in 2022-23.
India’s exports (USD 4.1 billion) to Canada include pharmaceuticals, gems and jewellery, textiles, and machinery, while Canada’s exports to India (USD 4.06 billion) include pulses, timber, pulp and paper, and mining products.
On investments, he said that Canadian pension funds will continue investing in India on grounds of India’s large market and good return on money invested.
Canadian pension funds, by the end of 2022, had invested over USD 45 billion in India, making it the fourth-largest recipient of Canadian FDI in the world.
The top sectors for Canadian pension fund investment in India include infrastructure, renewable energy, technology, and financial services.
Mumbai-based exporter and Chairman of Technocraft Industries Sharad Kumar Saraf said the present frosty relations between India and Canada are certainly a cause for concern.
“However, the bilateral trade is entirely driven by commercial considerations. Political turmoil is of a temporary nature and should not be a reason to affect trade relations,” Saraf said.
He added that even with China, India has acrimonious relations but bilateral trade continues to remain healthy.
“In fact, bilateral trade is an effective tool to improve political relations. India must make special efforts to increase our bilateral trade with Canada,” Saraf said.
India and Canada have a strong education partnership. There are over 200 educational partnerships between Indian and Canadian institutions.
In addition, over 3,19,000 Indian students are enrolled in Canadian institutions, making them the largest international student cohort in Canada, according to GTRI.
According to the Canadian Bureau for International Education (CBIE), Indian students contributed USD 4.9 billion to the Canadian economy in 2021.
Indian students are the largest international student group in Canada, accounting for 20 per cent of all international students in 2021.
Benefits of educational partnerships are mutual and hence the current situation may have no impact on the relationship, Srivastava said.
Apple supplier Foxconn aims to double India jobs and investment
Apple supplier Foxconn aims to double its workforce and investment in India by next year, a company executive said on Sunday.
Taiwan-based Foxconn, the world’s largest contract manufacturer of electronics, has rapidly expanded its presence in India by investing in manufacturing facilities in the south of the country as the company seeks to move away from China.
V Lee, Foxconn’s representative in India, in a LinkedIn post to mark Indian Prime Minister Narendra Modi’s 73rd birthday, said the company was “aiming for another doubling of employment, FDI (foreign direct investment), and business size in India” by this time next year.
He did not give more details.
Foxconn already has an iPhone factory employing 40,000 people in the state of Tamil Nadu.
In August, the state of Karnataka said the firm will invest US$600 million for two projects to make casing components for iPhones and chip-making equipment.
The company’s Chairman Liu Young-way said in an earnings briefing last month that he sees a lot of potential in India, adding: “several billion dollars in investment is only a beginning”.
Taiwan election: Foxconn’s Terry Gou taps star-powered running mate
Last month, Foxconn’s billionaire founder Terry Gou said he would run for the Taiwanese presidency in next year’s election, as an independent candidate.
He said the ruling and independence-leaning Democratic Progressive Party (DPP) was unable to offer a bright future for the island and left Foxconn’s board following his decision to run.
The firm operates the world’s largest iPhone plant, in the city of Zhengzhou in Henan province.
Foxconn to double workforce, investment in India by ‘this time next year’
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