Name
Global FinTech Guide
Country Name
Canada
SectionTitle
KYC requirements
Body
The know-your-customer or know-your-client (KYC) guidelines and regulations for financial services require that professionals try to verify the identity, suitability, and risks involved with maintaining a business relationship.

Legal affairs

National regulatory framework regarding AML and effective date of the regulations

AML regulations came into effect around 2018. The regulatory framework is presented in two statutes: Criminal Code and Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTA).

National regulator or relevant authority for AML controls

National regulator is the Federal Government of Canada and AML controls are enforced by FINTRAC.

Customer Due Diligence

Conduct of a typical KYC identification process

KYC identification process is often contracted out to third parties that specialize in accessing and screening international reports and documents. The standards to meet are in the PCMLTA.

Possibility to meet customer due diligence requirements by relying on third parties who are obliged by law themselves to comply with AML regulations

Yes.

Possibility to outsource customer due diligence by contract to other third parties who are not obliged by law to meet AML regulations and rely on these (e.g., WebID, IDnow, PostIdent)

Yes, because it is up to the reporting entity to ensure AML is compliant with regulations.

Presence of a license or registration requirement for the third party in case of outsourcing customer due diligence

We are not aware of any special requirements for obtaining a license or registration.

Further questions

Entities that could be relied on specifically by law as a third party to comply with AML regulations (regardless of outsourcing)


Yes credit institutions
Yes financial institutions
Yes auditors, external accountants, and tax advisors
Yes notaries and other independent legal professionals
Yes other trust or company service providers
No estate agents
No other persons trading high-value goods
No providers of gambling services



Authors

Disclaimer

© 2022, Miller Thomson LLP; Shibley Righton LLP. All rights reserved by Miller Thomson LLP; Shibley Righton LLP as author and the owner of the copyright in this chapter. Miller Thomson LLP; Shibley Righton LLP has granted to Multilaw non-exclusive worldwide license to use and include this chapter in this guide and to sublicense Lexis Nexis, a division of RELX Inc. and its affiliates certain rights to use and distribute this guide.

The information in this guide provides a general overview at the time of publication and is not intended to be a comprehensive review of all legal developments nor should it be taken as opinion or legal advice on the matters covered. It is for general information purposes only and readers should take legal advice from a Multilaw member firm.

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