Regulatory review looks to modernize frameworks as demand grows for digital, tailored advice
While DIY investors crave access to affordable, tailored online investment advice, there is concern that existing rules could be preventing it.
The Canadian Investment Regulatory Organization has launched a review of its regulatory framework to determine if policies originally designed around traditional, in-person advisory models are inadvertently constraining innovation.
The review follows on from CIRO’s initiative to modernize the Order Execution Only (OEO) framework to meet the evolving needs of DIY investors.
Any move that widens online investment advice for self-directed investors could have wide-ranging implications for firms operating in digital and hybrid channels and CIRO’s review will focus on the firms offering online advice today that often rely on exemptions or customized regulatory relief, adding cost and complexity that may discourage broader adoption.
“Our policy framework was designed for traditional advisory services, and we hope the review will identify any regulatory barriers in CIRO’s current policy,” says Alexandra Williams, senior vice-president of strategy, innovation and stakeholder protection. “This review will help identify whether any aspects of our current framework may be creating barriers, particularly for Canadians seeking affordable tailored online advice.”
While self-directed investing platforms have expanded rapidly, CIRO acknowledges that not all investors are well served by execution-only models. Some investors want guidance that is personalized but delivered digitally and at a lower cost than full-service advice; an area the regulator sees as underdeveloped in Canada.
In an administrative bulletin, CIRO outlines several challenges facing firms that want to operate in this space. These include uncertainty around regulatory expectations, inconsistent application of rules and higher compliance costs, all of which may limit product offerings or deter smaller firms from entering the market.
The review will also consider how online advice fits within existing advisory and managed account channels, particularly as technology enables new approaches such as model-driven portfolios and automated suitability assessments. CIRO notes that innovation must still align with investor protection principles, including clear accountability, effective supervision and strong controls around data and cybersecurity.
Industry participants, investor advocates and other stakeholders are being asked to provide feedback as part of the consultation process. CIRO has set a submission deadline of January 31, 2026.
The outcome of the review could signal whether Canada’s regulatory environment is ready to support a broader range of digital advice models or whether further modernization is needed to meet changing investor expectations.
