INSURANCE & FINANCIAL

Proposed N131-103 Registration Requirements We are writing to provide the comments of Industrial Alliance Insurance and Financial Services Inc. (Industrial Alliance) on the Notice and Request for Comment dated February 27,2008 ("the Notice"), on Proposed National Instrument 31-103 Registration Requirements, Proposed Companion Policy 31-153CP and Proposed Amendments to Multilateral Instrument 33-109 Registration Information published for public comment by the Canadian Securities Administrators ("CSA") (respectively, the "Proposed Instrument" and the Proposed Companion Policy" and collectively, the "Proposal"). Industrial Alliance has a national footprint in the distribution of financial services in Canada. Through our three broker-dealers: IA Securities Inc., a nationally registered securities dealer and IDA member, as well as FundEX Investments Inc. and Investia Financial Services Inc., both of which are nationally registered mutual fund dealers and members of the MFDA, we currently represent over 2000 licensed advisors. We will limit our comments to those that we feel will specifically affect the way in which our advisors and our firm will be able to service our more than 300,000 clients. At a high level, Industrial Alliance is in complete support of regulatory proposals that provide consistent treatment of the consumer experience, greater clarity and consistency of rules, and efficiencies in process.

Industrial Alliance fully endorses the CSA's stated aim of the Proposal - "to create a flexible and administratively efficient [registration] regime with reduced regulatory burden". We also commend the CSA for its efforts in achieving the level of uniformity and harmonisation of the current myriad of registration-related rules. Given the historical differing positions taken by the various CSA members on registrant regulation, the Proposals are indeed a welcome achievement on the part of the CSA. We support the objective of the Proposed Instrument to harmonise, streamline and modernise the registration regime for dealers and dvisors across the CSA jurisdictions. In addition, we would note the importance of achieving greater harmony in the rules, and application of rules, of the Self Regulatory Organizations (SROs), whose role will be critical to the shaping of a consistent investor experience.

There are elements of the Proposal, however, that are of concern to us. The three broad areas of concern that we touch on from this perspective include: dealer-advisor registration; compliance and suitability; and the Client Relationship Model. On the proposals relating to dealer registration, we support the retention of the Mutual Fund Dealer category. We further support the proposals to ensure adequate transition periods and the permission of grandfathering of proficiency requirements where appropriate.

The Proposed Instrument appears to confine the business of a Mutual Fund Dealer, a position that does not properly reflect the realities of the distribution business, which has broadened significantly in scope in recent years. We are concerned by the language in the Proposal restricting mutual fund dealers and their advisors "solely" to the distribution of mutual funds. Professional financial advisors are engaged in the analysis of the financial situations of their clients, and in recommending solutions for their investment needs from a wide array of products including GICs, Principal-Protected Notes, Mutual Funds, and Segregated Funds. The Proposal's language should be modified to reflect these realities. The Proposal introduces a new category of registration: the Exempt Market Dealer. We require more discussion about the regulatory oversight structure that would be faced by mutual fund dealers that also distribute exempt market products. It is our view that the registration regime should recognise the higher level of oversight that membership in an SRO brings, and accordingly MFDA Members should be permitted to sell exempt market products without the additional requirement to register as Exempt Market Dealers.