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One of the proposals published is intended to stop fund managers from paying so-called “upfront” commissions to the dealers, which can be covered by the management fees charged to a fund, potentially reducing returns.

Prohibiting those kind of commissions, the regulators say, would lead to the end of what is known as the “deferred sales charge option.” Under such an option, investors may not pay an initial sales charge for their securities, but they could be forced to pay a fee later if they try to sell those securities before a certain amount of time has elapsed.

“The upfront sales commission payable by fund organizations to dealers for mutual fund sales made under the (deferred sales charge) option is a key feature of that sales charge option that gives rise to a conflict of interest that can incentivize dealers and their representatives to make self-interested investment recommendations to the detriment of investor interests,” said the notice published by the CSA.

Another proposed amendment from the regulators is intended to ban a type of commission paid to dealers who don’t do a “suitability determination,” which helps assess the most appropriate investment product for a client.

The proposed amendments, including the elimination of some disclosure requirements, are undergoing a 90-day comment period.

However, the Ontario PC regime, led by Ford, quickly indicated they do not support the effort, which they noted had begun under the province’s previous, Liberal regime.