What is the National Registration Database (NRD)?
The National Registration Database (NRD) is a pivotal Canadian platform introduced in 2003 that digitized the process of filing registration forms for security dealers and investment advisors. It marked a significant shift from the previous paper-based system, simplifying regulatory compliance in the securities sector.
Transforming the Registration Process with NRD
The NRD has revolutionized the filing and disseminating of information among provincial securities regulators, making it exceptionally efficient. For example, notifying a change in a member firm’s information or terminating an investment advisor requires filing via the NRD, ensuring a seamless and error-free process.
In Canada, it is mandatory for individuals or companies involved in trading, underwriting securities, or providing investment advice to register annually with provincial securities regulators. This measure safeguards the investing public, ensuring only competent and reputable entities receive licenses. The CSA, alongside IIROC, spearheaded the initiation of NRD, pooling together securities regulators from all provinces and territories to ensure cohesive regulations.
On the CSA’s website, investors can verify the registration status of firms or individuals before investing, facilitated by the NRD’s structured database. The NRD comprises two main websites: the NRD Information Website accessible to the public and the National Registration Database designed for authorized representatives.
A Vision Realized: Why NRD Came into Existence
Realizing the inefficiencies of the paper-based system, securities regulators envisaged an advanced, electronic registration system. An online national registration system aligned perfectly with CSA’s objectives of reducing the regulatory burden on market participants and unifying securities regulations nationwide.
A 2001 study projected that the implementation of NRD would yield economic benefits amounting to $85 million over a five-year period for the Canadian financial services industry.
The NRD’s Expected Benefits
The key benefits expected from NRD revolve around enhanced efficiencies. For example, besides saving tremendous labor costs and time, firms anticipated significant financial gains. Large firms estimated capturing over 50% of the expected $85 million benefits. Moreover, while benefits per registrant at small firms projected $2,200 compared to $264 per large firm registrant, this showcased NRD’s varied impact favoring different firm sizes.
The ABCs of Registering With the NRD
Registering with NRD entails a fee. When entities initially register, they incur specific costs, including fees for registration in additional jurisdictions or for activating dormant registrations. For each Form 33-109F4 submitted, the initial registration fee is $75, and $20.50 applies for each individual applying for registration in additional jurisdictions.
Related Terms: Canadian Securities Administrators, Investors, Capital Markets, Electronic Filing System.
