February 2022

IIROC Custodial Agreements: A Guide for Investors and Brokers

The Investment Industry Regulatory Organization of Canada (IIROC) is a self-regulating organization that oversees the trading activity of investment dealers and their representatives in Canada. One of the primary functions of IIROC is to ensure that investors` assets are protected and kept secure through custodial agreements.

What are IIROC Custodial Agreements?

IIROC custodial agreements are legal contracts between investment dealers and their clients that govern the handling and safekeeping of their assets. The agreements outline the responsibilities of both parties to ensure that clients` investments are securely held and protected from any potential fraud or theft.

In Canada, IIROC-regulated dealers are required to enter into a custodial agreement with their clients, which is typically a standard form agreement that is compliant with IIROC rules and regulations.

Why are Custodial Agreements important?

Custodial agreements are important for both investors and brokers because they provide a clear understanding of the roles and responsibilities of each party concerning the handling and safekeeping of client assets. They also provide a framework for resolving disputes that may arise in the future.

Investors can rest assured that their assets are being held securely and are protected from any potential fraud or misappropriation. They can also confirm that their investments are being held in a segregated account and are not commingled with the dealer`s own assets.

For brokers, custodial agreements help to manage risk and ensure that they are operating in compliance with IIROC rules and regulations. Failure to follow these rules can result in costly fines and reputational damage.

What do IIROC Custodial Agreements include?

IIROC custodial agreements may vary slightly from dealer to dealer, but they typically include the following provisions:

1. Account Information: This provision outlines the account holder`s name, address, and other identifying information.

2. Custodian: This section identifies the custodian responsible for the safekeeping of the client`s assets.

3. Segregation of Assets: This provision outlines the requirement for the investment dealer to hold client assets in a segregated account.

4. Investment Powers: This section outlines the investment powers of the custodian and the broker.

5. Fees and Expenses: This provision outlines the fees and expenses associated with the account.

6. Termination of Agreement: This section outlines how the agreement can be terminated by either party.

Conclusion

In conclusion, IIROC custodial agreements are crucial for protecting the investments of clients and ensuring that brokers are operating in compliance with IIROC rules and regulations. These agreements provide a clear understanding of the roles and responsibilities of each party and help to manage risk and resolve disputes that may arise in the future. It is essential for investors and brokers to understand the provisions of these agreements and ensure that they are entered into correctly and compliantly.

If you are a business owner with a registered trademark in the European Union, you might have heard about the possibility of entering into an EUIPO coexistence agreement. But what exactly is this agreement and what are its benefits? In this article, we will explore the concept of a coexistence agreement, its advantages, and some practical considerations.

First of all, let`s define what we mean by “coexistence”. In the context of trademarks, coexistence refers to the situation where two or more trademark owners agree to use similar or even identical trademarks in the same or related markets. This can happen when the trademarks have some differences that allow them to coexist without causing confusion among consumers. For example, two companies might use the same word mark for different products or services, but with different logos or packaging designs that distinguish them from each other.

Now, let`s focus on the EUIPO coexistence agreement. As you may know, the EUIPO (European Union Intellectual Property Office) is the agency responsible for registering and managing trademarks and other IP rights in the EU. When you apply for a trademark registration in the EU, your application will undergo a thorough examination process to determine if it meets the criteria for registration. One of these criteria is that your trademark should not be confusingly similar to an earlier trademark that is already registered or pending.

However, there may be cases where two or more trademark owners have similar or identical trademarks that coexist peacefully in the market, but that cannot be registered without a risk of conflict. In such cases, the EUIPO allows these owners to enter into a coexistence agreement that “recognizes and regulates the coexistence of identical or similar trademarks that are registered for identical or similar goods or services in the same or closely related markets” (source: EUIPO Guidelines for Examination).

The advantages of a coexistence agreement are several. First, it allows you to preserve your trademark rights while avoiding costly legal disputes with other trademark owners. Second, it can help you to expand your business into new markets where another trademark owner has already established a similar mark, without having to rebrand your products or services. Third, it can enhance your bargaining power in negotiations with other trademark owners, as you can offer them a mutually beneficial solution that avoids the risk of confusion or dilution of their brand.

However, it is important to note that a coexistence agreement is not a guarantee of complete peace and harmony. While it can provide a framework for coexistence, it cannot prevent other trademark owners from challenging your mark or some aspects of the agreement. Moreover, a coexistence agreement may have some limitations, such as geographical or temporal restrictions, or restrictions on the use of certain elements of the trademarks.

If you are considering a coexistence agreement, it is advisable to seek legal advice from a qualified IP lawyer or consultant who can help you to assess the risks and opportunities involved, negotiate the terms of the agreement, and ensure that it complies with the EUIPO regulations and your business strategy. A well-drafted coexistence agreement can be a valuable asset for your business, but it requires careful planning and execution.

In conclusion, an EUIPO coexistence agreement can be a useful tool for trademark owners who face the challenge of coexisting with similar or identical marks in the EU market. By recognizing and regulating the coexistence of these marks, the agreement can help to avoid conflicts, expand business opportunities, and protect your brand identity. However, it requires a thorough understanding of the legal and practical aspects involved, and a proactive approach to managing your trademark portfolio.