Olivia Lifman
Associate
Article
Financial Stability Board (FSB), Autorité des marchés financiers (AMF), Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), Canadian Council of Insurance Regulators (CCIR) and the Canadian Insurance Services Regulatory Organizations (CISRO) issue guidance and consultations for banks, credit unions, financial intermediaries and other market participants.
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Despite the challenges to the global economy and significant pressures on the financial sector, Canada's financial regulators continue their regulatory work that has not been impacted by COVID-19 considerations by forging ahead with consultations and expanding their regulatory reach.
On May 4, 2020, the FSB published guidance designed to ensure that CCPs do not themselves become a source of systemic risk. It is composed of two parts:
The FSB is inviting comments on this consultation report. Responses should be sent to fsb@fsb.org with "CCP consultation" in the subject line by July 31, 2020.
On May 1, 2020, the provisions of Bill 141 pertaining to the transfer of supervision of the mortgage brokerage sector to the AMF came into force.
As described in the notice of the AMF, as of May 1, 2020, real estate brokers will need a mortgage broker certificate issued under the Act respecting the distribution of financial products and services in order to purse activities as mortgage brokers and, among other things, receive remuneration that is contingent on the making of a mortgage loan, including in the case of referrals to lenders.
This is a reminder that, on June 1, 2020, amendments to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations will come into effect. These amendments introduce a number of changes to Canada's anti-money laundering and terrorist financing legislation, including the addition of registration and compliance obligations for foreign money services businesses ("FMSBs") and virtual currency dealers.[1]
As of June 1, 2020, FMSBs will be required to register with the FINTRAC and will have the following additional obligations:
FMSBs are currently able to voluntarily register with FINTRAC ahead of the June 1, 2020 deadline by using the pre-registration form.
Gowling WLG's Financial Regulatory team is available to act as the representative of FMSBs in Canada (including, virtual currency dealers that are FMSBs) and to help them understand and comply with their obligations pursuant to Canadian anti-money laundering laws.
On June 1, 2020, updated guidance on suspicious transaction reports ("STRs") comes into effect for all FINTRAC reporting entities and individuals employed by such entities.
This guidance document answers the following questions:
This updated guidance should be read in conjunction with the two other suspicious transaction reporting guidance documents:
On May 7, 2020, the Canadian Council of Insurance Regulators ("CCIR") and the Canadian Insurance Services Regulatory Organizations ("CISRO") published a notice announcing the launch of the CCIR-CISRO FinTech/InsurTech Advisory Hub (the "Advisory Hub").
If you have any questions as to how these regulatory changes may impact your organization's obligations, please contact your Gowling WLG professional. Our Financial Services Regulatory Team at Gowling WLG will continue to keep you informed as further developments arise.
For other COVID-19 related resources, please visit our resource page with information to help clients manage their business during the pandemic. The page contains critical information to guide you through various complex legal issues, as well as a list of key contacts who can provide advice on these issues.
[1] A person or entity is a FMSB if it does not have a place of business in Canada, and is engaged in the business of providing any of the following services to Canadian customers: (i) foreign exchange dealing, (ii) remitting funds or transmitting funds (iii) issuing or redeeming money orders, traveller's cheques or other similar instruments except for cheques; or (iv) dealing in virtual currencies.
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