CIPF Assessment Appeal Procedures
October 3, 2013
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These Assessment Appeal Procedures should be read in conjunction with CIPF’s Assessment Policy. The Assessment Policy sets out the basis and rate of assessment that will be levied on CIPF Members.
CIPF is authorized to assess Members pursuant to Section 2.1 of the Industry Agreement between CIPF and the Investment Industry Regulatory Organization of Canada (“IIROC”) dated September 30, 2008, as amended. Under the agreement, CIPF determines the amount of assessment that IIROC must collect for each Member. IIROC Rule 41 requires Members to pay those assessments.
The determination of CIPF's Assessment Policy and its application to Members or any individual Member is not subject to review or appeal by a Member except only to the extent of the calculation of the amount of a Member's Quarterly Assessment, New Member Assessment and Capital Deficiency Assessment within the formula and methodology adopted by CIPF for determining assessments. In particular, fund size, the basis of assessments, IIROC's decision that a Member was capital deficient and the rate of assessments (including, without limitation, the differential assessment formula, minimum and maximum assessments, identification and weightings of quantitative and qualitative factors and the probability of default assigned to a differential assessment rate) are not subject to review or appeal.
Appeals are considered by CIPF’s Industry Risk Committee on behalf of the CIPF Board.
During the appeal process Members are required to pay the assessed amount. If the Member is successful in its appeal, CIPF will promptly refund the amount collected in excess of the adjusted assessment amount. Any costs incurred by a Member relating to an appeal will not be paid by CIPF.
1. A Member can appeal the CIPF Assessment levied to it by submitting a request to the Vice-President & Secretary of CIPF, at email@example.com.
2. Within 10 business days of receiving an appeal request, CIPF will acknowledge receipt of the request to the Member and provide preliminary timelines for the appeal process.
3. If the appeal requires a review of the probability of default calculated by the CIPF model, CIPF staff will review the factor inputs to ensure no changes are required.
a) If CIPF staff concludes that a change is justified, it will advise the Member of its adjusted assessment amount. The Member can decide to accept the adjusted amount or continue with the appeal.
b) If CIPF staff concludes that a change is not justified, it will discuss its review with the Member. The Member can decide whether or not to continue with its appeal.
4. Where the appeal continues or the assessment appeal does not require a review of the probability of default, CIPF staff will:
a) Prepare an Appeal Summary of Facts to assist the Industry Risk Committee in considering the Member’s appeal.
b) The Summary of Facts will be provided to the Member for review and comment. Comments received will be incorporated in the document.
c) The Member will be asked to confirm that the Summary of Facts is complete and accurate.
d) The Member will be notified, in writing, of the date, time and place of the appeal meeting.
e) The Industry Risk Committee and the Member will be provided with:
(i) The Summary of Facts
(ii) The results of previous appeals
(iii) Appeal meeting procedures
f) The appeal meeting shall be attended by the Chair of the Industry Risk Committee, and at least 2 other Committee members, of which one must be a public Director.
g) Any participant in the appeal can appear in person or by teleconference.
h) The Member may have legal counsel or other advisors present at the appeal, but it is not necessary to do so.
i) CIPF staff will also attend the appeal to take minutes, address questions or assist the Committee as required.
j) The Member, or its legal counsel, or other advisors, may take notes or transcripts of the meeting at their own expense.
k) After the appeal CIPF staff, the Member and its legal counsel or other advisors will be excused to permit the Industry Risk Committee to deliberate.
l) The Industry Risk Committee will decide on the appeal, by simple majority, and document the reasons for its decision.
m) The Member will be advised in writing of the Industry Risk Committee’s decision including the reasons for the decision.
n) If the Member’s appeal is successful, CIPF will immediately refund any amount that has been paid by the Member in excess of the adjusted assessment as determined by the Committee.