Canada’s Securities Administrators Ban Chargebacks in Fund Distribution

The Canadian Securities Administrators (CSA) has prohibited chargebacks in the distribution of publicly offered investment funds, a change intended to strengthen investor protection and transparency in Canada’s investment market.

The prohibition took effect immediately and applies to registrants subject to National Instrument 31-103. Affected stakeholders will need to reassess their operational frameworks and distribution processes under the new requirements.

The measure is intended to support confidence in Canada’s capital markets and eliminate potential exploitation in fund transactions. The CSA is the umbrella organization for Canada’s provincial and territorial securities regulators.

The change is part of a broader trend toward stricter compliance in the investment sector. It affects how publicly offered investment funds are distributed and how firms manage related operational procedures.