The OSC yesterday published a staff notice to provide guidance on the circumstances in which certain exemptions from the dealer registration requirement under the Commodity Futures Act are available to market participants.
Specifically, the notice provides OSC staff's view on when foreign dealers and other market participants may rely on certain exemptions under the CFA, such as the "unsolicited trade" exemption, including indicia of activities considered to be "carrying on business" in Ontario and activities considered to be "solicitation" in a jurisdiction. In this respect, staff identify the following factors as indicia of "carrying on business in Ontario:
- the establishment of an office or place of business in Ontario;
- the establishment of a relationship with an affiliated entity or third party in Ontario to conduct marketing or other activities that are in furtherance of a trade with a customer in Ontario;
- payment of commissions, fees or similar compensation to "introducing brokers", "finders", "referral agents" or other persons in connection with the trade with a customer in Ontario; and
- trading with regularity with customers in Ontario, whether in reliance on the unsolicited trade exemption and/or in reliance on other exemptions, including exemptions contained in a discretionary exemptive relief order granted by the OSC under the CFA or the Securities Act (Ontario).