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1.6 Canadian Securities Regulators, the CSA & CIRO

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Canadian Securities Course CSC

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1 Introduction & Exam Overview

About the CSC Exams

2 Chapter 1: The Canadian Investment Marketplace

1.1 The Canadian Securities Industry & the Investment Dealer's Role 1.2 Financial Intermediaries: Banks, Trusts, Credit Unions, Insurers & Pension Funds 1.3 Financial Market Trends 1.4 Investment Capital, Financial Instruments & Financial Markets 1.5 Canadian Exchanges, ATSs, Dark Pools & the Order Protection Rule 1.6 Canadian Securities Regulators, the CSA & CIRO 1.7 Investor Protection: OSFI, CIPF and CDIC 1.8 Ethics, Standards of Conduct & the Client Focused Reforms 1.9 Conflicts of Interest, Complaint Handling & Remediation

3 Chapter 2: The Economy

2.1 Economics Foundations & Measuring Economic Growth 2.2 The Business Cycle & Economic Indicators 2.3 Inflation & Interest Rates 2.4 The Labour Market & Unemployment 2.5 The Bank of Canada & the Inflation-Control Target 2.6 Implementing Monetary Policy: The Operating Band, Market Operations & Transmission 2.7 Fiscal Policy, Deficits & the Challenges of Government Policy 2.8 International Finance & Trade: The Balance of Payments and the Canadian Dollar

4 Chapter 3: Features and Types of Fixed-Income Securities

3.1 The Fixed-Income Marketplace, Bond Terminology & Security 3.2 Protective Covenants, Retirement Provisions & Extendible/Retractable Features 3.3 Government of Canada Securities: T-Bills, Marketable Bonds & RRBs 3.4 Provincial & Municipal Debt and Strip Bonds 3.5 Corporate Bonds, Credit Spreads & Bond Ratings 3.6 Money Market Instruments, Floating-Rate Notes & International Bonds 3.7 Other Fixed-Income Securities & Reading Bond Quotes

5 Chapter 4: Pricing and Trading of Fixed-Income Securities

4.1 Bond Pricing, Price–Yield Relationships & Accrued Interest 4.2 Yield Calculations & Return Measures 4.3 The Term Structure of Interest Rates & Yield Curve Theories 4.4 Fundamental Bond Pricing Properties: Volatility Rules, Duration & Convexity 4.5 Bond Market Trading & Bond Indexes

6 Chapter 5: Common and Preferred Shares

5.1 Common Shares: Ownership Rights, Voting & Restricted Shares 5.2 Dividends, DRIPs, Stock Splits & Consolidations 5.3 Preferred Shares: Features, Cumulative Dividends & Taxation 5.4 Preferred Share Variations: Convertible, Callable, Retractable, Floating & Rate-Reset 5.5 Fundamental Equity Metrics & Ratios 5.6 Stock Indexes & Averages

7 Chapter 6: Equity Transactions

6.1 Order Types, Execution & Market Mechanics 6.2 Margin Trading: Long Accounts & Borrowing 6.3 Short Selling & Short-Margin Requirements 6.4 Trading & Settlement Procedures: T+1, CDS & Confirmations

8 Chapter 7: Derivatives

7.1 Derivatives: Role, Underlying Assets & Users 7.2 Options Fundamentals: Calls, Puts & Moneyness 7.3 Option Strategies & Risk Management 7.4 Forward & Futures Contracts 7.5 Rights & Warrants

9 Chapter 8: Corporations and their Financial Statements

8.1 Corporate Structures & Corporate Governance 8.2 The Annual Report, Accounting Standards & the Auditor's Report 8.3 The Balance Sheet & Income Statement 8.4 The Cash Flow Statement & Earnings Quality 8.5 Public Company Disclosure, Investor Rights, Take-Over Bids & Insider Trading

10 Chapter 9: Financing and Listing Securities

9.1 Government & Corporate Financing: Underwriting and Syndicates 9.2 The Prospectus Process, Stabilization & Purchaser Rights 9.3 The Exempt Market & Private Placements 9.4 The Listing Process: TSX, TSXV & Capital Pool Companies 9.5 Continuous Disclosure, Material Changes & Insider Reporting

11 Chapter 10: Investment Analysis

10.1 Methods of Equity Analysis & Macroeconomic Analysis 10.2 Fundamental Industry Analysis 10.3 Company Analysis: Competitive Advantages, Governance & the Dividend Discount Model 10.4 Discounted Cash Flow & Relative Valuation Multiples 10.5 Financial Statement Ratio Analysis 10.6 Assessing Preferred Share Investment Quality 10.7 Technical Analysis: Charts, Trends & Patterns 10.8 Technical Indicators, Volume, Breadth & Sentiment

12 Chapter 11: Portfolio Analysis

11.1 Measuring Investment Return 11.2 Measuring Risk: Types of Risk, Standard Deviation & Downside Measures 11.3 Portfolio Risk & Return: Correlation and Diversification 11.4 Beta, the Capital Asset Pricing Model & the Security Market Line 11.5 Portfolio Manager Styles: Equity & Fixed Income 11.6 The Portfolio Management Process: Objectives, Constraints & the IPS 11.7 Asset Mix, Monitoring, Performance Evaluation & Rebalancing

13 Chapter 12: Alternative Investments, Other Managed, and Structured Products

12.1 Alternative Investments: Structures, Fees & Liquid Alternatives 12.2 Alternative Strategies, Performance Measurement & Due Diligence 12.3 Segregated Funds, Labour-Sponsored Funds & Listed Private Equity 12.4 Income Trusts, REITs & Closed-End Funds 12.5 Structured Products: PPNs & Market-Linked GICs 12.6 Split Shares & Asset-Backed Securities

14 Chapter 13: Mutual Funds

13.1 Managed Products & Mutual Fund Structure 13.2 Pricing Mutual Fund Units: NAVPS & Forward Pricing 13.3 Mutual Fund Fees, Sales Charges & Unit Series 13.4 Mutual Fund Regulation, Fund Facts & Account Opening 13.5 Types of Mutual Funds & Fund Management Styles 13.6 Redemptions, Withdrawal Plans & Measuring Fund Performance

15 Chapter 14: Exchange-Traded Funds (ETFs)

14.1 ETF Origins, Structure, Tax Efficiency & ETF Facts 14.2 ETF Creation, Redemption & Arbitrage 14.3 Types of ETFs & Advanced Strategies 14.4 Comparing ETFs, Mutual Funds & Individual Securities

16 Chapter 15: Working with the Institutional Client

15.1 The Institutional Marketplace & Institutional Clients 15.2 Institutional Investment Guidelines, Styles & Restrictions 15.3 Buy Side & Sell Side: Trading Desks, Revenue, Clearing & Best Execution 15.4 Block Trading, Dark Pools & Algorithmic Trading

17 Chapter 16: Fee-Based Accounts and Working with the Retail Client

16.1 Fee-Based Accounts: Managed & Non-Managed Models 16.2 Fee Transparency, CRM2 & Total Cost Reporting, and MWRR vs. TWRR 16.3 The Financial Planning Approach & the Life Cycle 16.4 Behavioral Finance, Sequence-of-Returns Risk & Client Coaching 16.5 Estate Planning Basics

18 Chapter 17: Canadian Taxation

17.1 The Canadian Taxation System 17.2 Taxation of Investment Income 17.3 Capital Gains, Losses & The Superficial Loss Rule 17.4 Registered vs Non-Registered Tax-Advantaged Accounts 17.5 Tax Planning Strategies, Pension Plans & the RDSP

1.6 Canadian Securities Regulators, the CSA & CIRO

Key Takeaways Explain This Topic AI

Securities regulation is provincial; the 13 provincial and territorial regulators coordinate through the Canadian Securities Administrators (CSA) using national instruments.

CIRO, formed in 2023 from IIROC and the MFDA, regulates investment dealers, mutual fund dealers and trading on Canadian marketplaces.

Since January 1, 2026, CIRO uses an exam-based proficiency model (for example, the CIRE and RSE), and CSI states the CSC is no longer acceptable for CIRO approval with an investment dealer.

Under the passport system, an issuer or registrant deals with its principal regulator, whose decision applies in other passport jurisdictions.

Enforcement can be administrative (orders, suspensions, penalties), quasi-criminal (provincial Securities Act prosecutions) or criminal (Criminal Code).

Last updated: October 2026

The Provincial Regulatory Model & The CSA

Unlike the United States, where the Securities and Exchange Commission (SEC) exercises federal jurisdiction, Canada does not have a federal securities regulator.

Constitutional Foundation

Under Section 92(13) of the Constitution Act, 1867 ("Property and Civil Rights in the Province") , securities regulation falls within provincial and territorial jurisdiction. Landmark Supreme Court of Canada reference decisions (notably in 2011 and 2018) confirmed that while the Parliament of Canada possesses constitutional authority over systemic national financial risks, day-to-day securities regulation—including registration, prospectus filings, and market conduct—belongs exclusively to the ten provinces and three territories.

The Major Provincial Regulators

Each jurisdiction enforces its own provincial Securities Act through an administrative commission. The "Big Four" regulators represent the vast majority of market activity:

Ontario Securities Commission (OSC) : Canada's largest securities commission, overseeing the Toronto financial center.

British Columbia Securities Commission (BCSC) : Primary oversight of Western Canadian venture markets.

Alberta Securities Commission (ASC) : Major oversight of energy, resource, and private capital issuers.

Autorité des marchés financiers (AMF) in Quebec: An integrated regulator supervising securities, financial institutions, insurance distribution, and deposit protection.

The Canadian Securities Administrators (CSA)

To prevent regulatory fragmentation and create an efficient national market, the 13 provincial and territorial regulators established the Canadian Securities Administrators (CSA) as an umbrella coordination council.

Policy Instruments

National Instruments (NIs) : Substantive, legally binding rules that are adopted identically across all 13 provincial and territorial jurisdictions (e.g., NI 31-103 governing registration requirements, NI 45-106 for prospectus exemptions, NI 81-102 for investment funds).

Multilateral Instruments (MIs) : Rules adopted by several, but not all, jurisdictions.

National Policies (NPs) : Non-binding interpretative guidance explaining how commissions apply specific statutory provisions.

National Infrastructure

The CSA operates centralized electronic databases that unify Canadian capital markets:

SEDAR+ (System for Electronic Data Analysis and Retrieval +) : The mandatory filing portal for public company prospectuses, audited financial statements, MD&As, and continuous disclosure documents.

SEDI (System for Electronic Disclosure by Insiders) : The web-based filing system where corporate insiders must disclose changes in their beneficial share ownership within 5 calendar days.

NRD (National Registration Database) : The centralized digital system through which dealer firms and individual representatives submit licensing applications and regulatory amendments.

The Passport System

Under the Passport System , a market participant files documents or registers in its designated "principal jurisdiction" (typically where its head office is located). Approval by the principal regulator automatically grants access to participate in all other participating passport jurisdictions without requiring separate independent reviews. Ontario has not adopted the passport system; it participates as an interface regulator, making its own decision on a filing but generally relying on the principal regulator's review, so the outcome is similar.

Canadian Investment Regulatory Organization (CIRO)

On January 1, 2023, Canada's self-regulatory landscape underwent a historic structural consolidation. The Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA) amalgamated to create a single national self-regulatory organization (SRO), officially named the Canadian Investment Regulatory Organization (CIRO) in June 2023. [Provincial Securities Commissions (CSA)]

  • │
  • Delegates SRO Authority to
  • ▼
  • [Canadian Investment Regulatory Organization (CIRO)]
  • │
  • ┌───────────────────────────┴───────────────────────────┐
  • ▼ ▼
  • [Dealer Regulation] [Market Surveillance]
  • Regulates Investment Dealers - Administers UMIR
  • Regulates Mutual Fund Dealers - Real-time trading surveillance
  • Financial compliance & exams - Detects spoofing, wash trades,
  • Sets proficiency & conduct rules insider trading & front-running
  • Mandate and Structure

CIRO is recognized by provincial securities commissions to protect investors, promote market integrity, and ensure fair competition. CIRO operates two primary operational divisions:

Dealer Regulation : Sets financial capital adequacy standards, conduct rules, supervision guidelines, and compliance examination schedules for both investment dealers (formerly IIROC members) and mutual fund dealers (formerly MFDA members). CIRO possesses statutory disciplinary authority to conduct investigations, hold enforcement hearings, assess administrative fines, and suspend or bar registered individuals and firms.

Market Surveillance : Administers the Universal Market Integrity Rules (UMIR) across all recognized Canadian stock exchanges (TSX, TSXV, CSE) and ATS platforms. CIRO surveillance analysts monitor equity and fixed-income trading in real time to detect manipulative algorithms, front-running, layering, spoofing, wash sales, and insider trading, possessing the legal authority to halt trading across all Canadian venues simultaneously.

CIRO's 2026 Proficiency Model and What It Means for the CSC

On January 1, 2026 , CIRO replaced its course-based proficiency rules for Approved Persons of investment dealers with an assessment-centric model . Under the new rules, an individual seeking approval to trade securities at an investment dealer writes the Canadian Investment Regulatory Exam (CIRE) , and a person who will also give retail advice writes the Retail Securities Exam (RSE) ; other categories have their own CIRO exams, plus mandatory conduct training and continuing education.

The Canadian Securities Institute states that, effective January 1, 2026, the CSC is no longer acceptable for CIRO approval with an investment dealer . Learners who enrolled before that date had a transition window: CSI grants course extensions only to December 31, 2026 . The CSC remains a current CSI credential. It is widely used for entry-level roles across financial services and is still a prerequisite for further CSI programs such as the CIM and PFP designations.

Question Short answer (2026)

Does the CSC still exist? Yes. CSI offers it with two proctored exams.

Does passing the CSC qualify you as an investment dealer Approved Person? Not on its own after January 1, 2026. CIRO's exams (such as the CIRE and RSE) now apply.

Who sets investment dealer proficiency? CIRO, under rules approved by the provincial securities commissions.

Registration, Principles and Enforcement

Registration. Under National Instrument 31-103, firms that trade or advise in securities must register in a category such as investment dealer, mutual fund dealer, exempt market dealer, portfolio manager or investment fund manager. Individuals register as dealing representatives or advising representatives, and each firm must designate an ultimate designated person (UDP) and a chief compliance officer (CCO) . Investment dealers and mutual fund dealers must also be members of CIRO, which approves their individuals.

Principles of regulation. Securities regulation aims to protect investors, foster fair and efficient capital markets, and maintain confidence in those markets. Canadian rules mix detailed requirements with principles-based obligations, such as the duty to deal fairly, honestly and in good faith.

Enforcement tools. Regulators and CIRO can use several levels of enforcement:

Administrative: cease-trade orders, suspension or cancellation of registration, reprimands and administrative penalties imposed by securities commissions or CIRO hearing panels.

Quasi-criminal: prosecution in provincial court for breaches of a provincial Securities Act, with fines and possible jail terms.

Criminal: charges under the Criminal Code for offences such as fraud, market manipulation and insider trading.