The Securities Commission granted Fidelity Clearing Canada ULC (the Filer) time-limited relief from prospectus and trade reporting requirements to distribute Crypto Contracts to permitted clients. This decision revokes a prior decision and is effective for two years. The relief is subject to conditions including specific disclosure and reporting requirements, and it aims to foster innovative businesses in Canada without setting a precedent for other filers.
Key Facts:
– The Filer is registered as an investment dealer and offers services related to Crypto Contracts and custody of Crypto Assets.
– The Filer’s clients include institutional clients and permitted clients.
– The Filer uses Fidelity Digital Asset Services, LLC (FDAS) as a foreign custodian and may use additional liquidity providers.
Reasoning:
– The decision aligns with the Canadian Securities Administrators’ (CSA) goal of balancing innovation with investor protection and market efficiency.
– The Filer has established policies and procedures to manage risks and ensure compliance with regulatory requirements.
Outcome:
– The Filer is granted relief from prospectus and trade reporting requirements, subject to conditions including maintaining appropriate disclosures, using acceptable custodians, and providing regular reports to regulators.
Relevant Laws and Regulations:
– Securities Act, R.S.O. 1990, c. S.5, as amended, sections 1(1), 53, and 74.
– Multilateral Instrument 11-102 Passport System, section 4.7.
– OSC Rule 91-506 Derivatives: Product Determination, sections 2 and 4.
– OSC Rule 91-507 Trade Repositories and Derivatives Data Reporting, Part 3.