CSA Multilateral Discussion Paper 11-406 – CSA Financial Innovation Hub Introduces Collaboratory and Data Portability Test

The CSA is examining the implications of data portability in Canadian capital markets and is consulting industry stakeholders through a new forward-looking program, the CSA Cohort-Based Testing Environment the CSA Collaboratory (CSA Collaboratory). Our first test within the CSA Collaboratory will seek to provide the CSA with a greater understanding of the impacts of data portability solutions and in particular the collection, analysis and transfer of client data, which is sometimes referred to as e-KYC solutions

Closing Consultation Date: May **, 2025

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A copy of the Discussion paper can be found on the website of the participating jurisdictions:
Alberta, British Columbia, Manitoba, New Brunswick, Nova Scotia, Saskatchewan

Questions about this proposal? Please refer to any of the following:

BC Securities Commission Khalil Jessa Senior Legal Counsel, Capital Markets Regulation British Columbia Securities Commission kjessa@bcsc.bc.ca	Elliott Mak Senior Legal Counsel, Corporate Finance British Columbia Securities Commission emak@bcsc.bc.ca
Alberta Securities Commission [insert contact]	Manitoba Securities Commission [insert contact]
Financial and Consumer Services Commission (New Brunswick) [insert contact]	Nova Scotia Securities Commission [insert contact]
Financial and Consumer Affairs Authority of Saskatchewan [insert contact]

Technical questions about submitting your comments? Click here to contact the CSA Secretariat for technical support. Or alternatively please reach out to info@acvm-csa.ca.

CSA Multilateral Discussion Paper 11-406 – CSA Financial Innovation Hub Introduces Collaboratory and Data Portability Test

Questions in this consultation are not mandatory. Please answer those that are relevant to you. We welcome any commentary outside our listed questions in the general comments section of this form.

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All previous submissions will be taken into consideration.

Compliance with Data Portability Requirements under Existing Law

1. What changes have you made in your organization (or that you expect to implement) to comply with existing or forthcoming Data Portability obligations, and what challenges have you encountered?

2. In what circumstances has there been a conclusion that the costs and complexities in implementing Data Portability resulted in the organization not being required to comply with such obligations? Are any of these related to securities legislation?

3. How do you anticipate that Data Portability will impact the investor experience, particularly in terms of reducing friction during transitions between service providers? If clients have already begun exercising their rights by utilizing these services, what has the feedback been so far?

4. What are the circumstances that you anticipate having to transfer data with external parties? How prevalent are these circumstances? Are there other regulatory obligations in securities legislation that market participants anticipate can be better satisfied through use of Data Portability?

Demand and Benefits of e-KYC and Other Data Portability Solutions

5. What motivated you to consider adopting an e-KYC or other Data Portability solution and what features and improvements would you like to see in the future? Alternatively, if your organization would not consider adopting an e-KYC or Data Portability solution, what is the principal reason for not doing so?

6. In what ways could e-KYC and Data Portability contribute to broader inclusion of investors? What steps can be taken to ensure that individuals who may have limited access to traditional identification systems are not disadvantaged by these innovations?

7. Are you aware of other e-KYC or Data Portability business models being considered?

8. What sorts of information do registrants anticipate transferring? What types of data would it be useful for registrants to obtain upon new client onboarding or at other times? Is there certain data that registrants have concerns with being required to transfer?

9. Are there circumstances in which transfer of data enhanced by other market participants to provide additional value, such as risk tolerance assessments, would be appropriate, and if so what are those?

Regulatory Barriers and Mitigating Investor Risk

10. In your opinion, are there any provisions or requirements in securities legislation or guidance that may create barriers on how your organization can utilize e-KYC or Data Portability solutions? If so, in your view, what is the most appropriate regulatory action that would enable or assist your organization to utilize an e-KYC or Data Portability solution (e.g. specific rule change, additional guidance)?

11. If you have already implemented an e-KYC solution, what specific challenges have you faced in implementing the solution? Have you faced challenges in implementing e-KYC or Data Portability solutions relating to varying regulatory frameworks internationally?

12. To what extent would industry-wide collaboration on Data Portability standards benefit registrants, and how can regulators such as the CSA support this collaborative effort? What challenges or barriers exist in developing and adopting such standards?

Privacy and Security Concerns

13. How does a registrant ensure that investors are fully informed and able to provide meaningful consent for the use of e-KYC and other Data Portability solutions? What improvements could be made to better inform customers about their data ownership rights and portability options? What measures could be taken to enhance customer understanding and control over their data?

14. What risks arise from the use of e-KYC and other Data Portability solutions? What regulatory measures or industry best practices would be most effective in addressing those risks? How can the CSA help ensure that investors are protected while enabling innovation in this space?

15. Do you see any security or accuracy issues arising with respect to utilizing an e-KYC or other Data Portability solutions for a large number of clients?

16. How do current industry standard KYC processes mitigate risks such as deepfakes, synthetic identities, identity fraud, and regulatory non-compliance, and what additional measures or technologies could be implemented to enhance protection against these threats?

Technological Standards and Innovations

17. What technological infrastructure is required to support efficient Data Portability, and how does the cost of implementation impact your business? Are there specific technologies or innovations that could help reduce costs while maintaining security and compliance?

18. How do third-party service providers (e.g., data aggregators, e-KYC platforms) influence the Data Portability process? What role should these third parties play in facilitating secure and compliant data transfers, and what regulatory oversight might be necessary?

19. How do you foresee blockchain or AI impacting the implementation of data portability and e-KYC? What steps can regulators take to prepare for these technological advancements while maintaining market integrity?

20. Data Portability often involves the transfer of customer data across jurisdictions. What regulatory or operational challenges do you encounter when facilitating cross-border data transfers, and how can regulatory frameworks better support such transfers in a compliant and secure manner?

21. To what extent would standardized data formats (such as those proposed by the consumer-driven banking framework) facilitate Data Portability between registrants? Are there existing frameworks or standards that should be adopted or modified to improve interoperability? Are there risks or disadvantages to such standardization?

CSA Collaboratory

22. Would you be interested in participating in either the Phase 2: Industry Consultation Forum or Phase 3: Live Testing Environment? If you are interested in participating in the live testing environment, how do you think you will be able to participate? (e.g. as a registrant using potential e-KYC services, or a potential e-KYC service provider)?

23. Although this first theme deals with emerging issues related to data portability and e-KYC, CSA staff are interested in developing further cohort-based testing environments. To that end, we are interested in understanding if there are emerging areas for the CSA to consider in subsequent cohorts. Please let us know if there area any particular areas of interest for us to further consider in future Testing Environments.

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CSA Multilateral Discussion Paper 11-406 – CSA Financial Innovation Hub Introduces Collaboratory and Data Portability Test

Compliance with Data Portability Requirements under Existing Law

Demand and Benefits of e-KYC and Other Data Portability Solutions

Regulatory Barriers and Mitigating Investor Risk

Privacy and Security Concerns

Technological Standards and Innovations

CSA Collaboratory

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