On January 31, 2025, the IIAC delivered a response to CIRO’s request for comments on its proposal to Modernize the CIRO Arbitration Program (the “Program”). CIRO’s request for comments followed from a series of recommendations that were made by an independent working group that was formed by IIROC to opine on this issue in 2022.

The Working Group’s recommendations and CIRO’s proposal are driven by the observation that, although the Program has characteristics that offer benefits to aggrieved investors as a forum for alternative dispute resolution, the Program nonetheless suffers from low case-volume. Both the working group and CIRO have attributed this dichotomy to barriers to entry and deficiencies in the Program.

The IIAC supports the Program and agrees that the Program should be preserved as a forum for resolving investor disputes. The Program offers several benefits that should continue to be made available to investors as an alternative to civil litigation, on the one hand, and the OBSI dispute resolution process, on the other hand. However, notwithstanding this support, the IIAC opposes several of CIRO’s recommendations.

The request for comments includes several recommendations that do not appear to support the goal of increasing participation in the Program:

• For example, CIRO proposes to create a claims-floor for the Program, which would effectively redirect claims below a prescribed monetary threshold from the Program to OBSI.
• In addition, CIRO has declined to follow several recommendations that were made by the Working Group including, for example, its recommendation to subsidize legal fees for investors as a means of reducing the economic barriers that constrain participating in the Program.
• Furthermore, CIRO’s request for comments includes proposals that were not included in the Working Group’s recommendations and that are entirely inappropriate.
• Most alarmingly, CIRO proposes to unilaterally extend the 2-year limitation under provincial statute by imposing a 6-year limitations period for claims commenced through the Program. This, among other proposals, is outside the scope of CIRO’s jurisdiction and cannot be accepted.

The IIAC strongly recommended that CIRO reconsider such proposals.