IIROC publishes for comment guidance on underwriting due diligence

Promoting consistency and enhanced standards

TORONTO, March 6, 2014 /CNW/ - The Investment Industry Regulatory Organization of Canada (IIROC) today published for comment proposed guidance outlining common due diligence practices and suggestions for IIROC dealers involved in the offering of securities to the public as underwriters.

IIROC's proposed guidance sets out: the elements of the underwriting due diligence process; the types of industry policies and procedures that dealer firms will need to support the underwriting due diligence process; and an appropriate supervisory and compliance framework.

"The capital-raising process is vital to a vibrant economy and IIROC dealers who facilitate this process play an important gatekeeper role. The proposed guidance is designed to promote consistency and enhanced underwriting due diligence practices," said IIROC President and Chief Executive Officer Susan Wolburgh Jenah.

The proposed guidance acknowledges that Dealer Member firms vary in size and by business model, and appropriate approaches to supervision and compliance for underwriting due diligence reflect these differences.

In preparing the proposed guidance IIROC consulted extensively with stakeholders, starting with an industry advisory committee, created by IIROC in 2012 and consisting of 21 senior industry representatives from a broad cross-section of small, medium and large firms across Canada.

Consultations also included several IIROC standing committees, the IIROC National Advisory Committee and various Dealer Member firms with specific experience in the venture market.  Discussions with these stakeholders provided valuable advice and insights into the current environment and existing practices to promote more consistent and enhanced industry standards.

While currently seeking comment on all aspects of the proposed guidance, IIROC is asking stakeholders to especially consider specific key issues, including further practices that might be included in the proposed guidance, additional or different considerations for specific industry sectors or types of public offerings, and circumstances for heightened due diligence and/or enhanced disclosure.

IIROC is the national self-regulatory organization which oversees all investment dealers and trading activity on debt and equity marketplaces in Canada.  Created in 2008 through the consolidation of the Investment Dealers Association of Canada and Market Regulation Services Inc., IIROC sets high quality regulatory and investment industry standards, protects investors and strengthens market integrity while maintaining efficient and competitive capital markets.

IIROC carries out its regulatory responsibilities through setting and enforcing rules regarding the proficiency, business and financial conduct of dealer firms and their registered employees and through setting and enforcing market integrity rules regarding trading activity on Canadian equity marketplaces.

SOURCE: Investment Industry Regulatory Organization of Canada (IIROC) - General News

Lucy Becker
Vice President, Public Affairs
416 943-5870
[email protected]

June Yee
Manager, Corporate Communications
416 943-6921
[email protected]