What happened Fair Dealing?

In 2004 the OSC issued a Press release on the Fair Dealing Model. Initial reports suggest the proposal is watered down due to industry input. Although the iniative appears well intended, it is impossible to pass judgment until details are released. The Press release follows:

OSC Chair David Brown unveils "Fair Dealing Model" to regulate relationship between the financial services industry and investors
TORONTO - The Ontario Securities Commission is considering significant changes to the way it regulates the relationship between the financial services industry and individual investors. OSC staff, in consultation with a group of investment industry leaders, has developed an outline of a new "fair dealing model".
The new framework would, among other things, seek to better define the rights and responsibilities of each party, reduce conflicts of interest in the provision of advice, and ensure greater transparency of adviser services, qualifications, compensation and other fees.
"A fair dealing model can result in a stronger financial services industry, enhanced competition around quality of advice, and clarity in provider-client relationships," OSC Chair David Brown said in a speech to kick-off Investor Education Month. "And it would cut unnecessary compliance costs, ensuring that providers and investors receive maximum regulatory value for every dollar spent."The OSC and its advisory group have studied business models in the financial services industry and recognized that the current regulatory model has become outdated. For example, securities regulations assume that advisers are compensated based on trading activity, yet most firms now take a wealth management approach where trading and advising are no longer viewed as separate activities. The proposed regulatory model is more flexible and would better reflect market realities.Changes being considered include the following:
requiring more complete information on how service providers are compensated, including clear disclosure of whether they receive payments or incentives from product issuers;
replacing existing account opening documentation with a new form that clarifies the nature of the provider-client relationship and seeks to improve clients' understanding and acceptance of investment risk;
placing clearer responsibility on firms, including liability for losses, for any improper activities of their officers, employees and agents;
replacing current registration categories with a single service provider license which makes no distinction between trading and advising; and
reducing certain regulatory requirements to improve small investors' access to a variety of investment opportunities and increase market access for new types of service providers.
Staff plan to expose the new "fair dealing model" to a wider group of stakeholders later this spring, and publish detailed proposals by the summer.