Bankruptcy or proposal

Representatives must notify the AMF if they declare a bankruptcy or file a proposal.

“Representative” here means any trainee or representative pursuing activities governed by the Act respecting the distribution of financial products and services This link will open in a new window (the “Distribution Act”) or the Securities ActThis link will open in a new window.

What distinguishes a bankruptcy from a proposal?

Bankruptcy allows persons who are insolvent or in financial difficulty to use a large portion of their property to pay their debts. Their property is liquidated by a bankruptcy trustee, who then distributes the money to the creditors.

A proposal is an offer by a debtor to the debtor’s creditors to repay all debts to them over a longer time or repay a percentage of the debts to them over a set period. There are two types of proposals: a proposal and a consumer proposal.

The AMF must be notified in either of the following situations:

  • The representative has declared bankruptcy, made an assignment of property or been placed under a receiving order pursuant to legislation relating to bankruptcy or insolvency
  • The representative has filed a proposal pursuant to legislation relating to bankruptcy or insolvency

What are the consequences of a bankruptcy or a proposal?

Each case is different. The AMF can’t make a decision about a given situation without having first analyzed the file.

However, following an analysis of the file, the AMF may decide to:

  • Place conditions or restrictions on your right to practise;
  • Refuse to issue or renew the right to practise; or
  • Cancel the right to practise.

Independent representative or responsible officer of a firm or independent partnership

A representative who declares bankruptcy or files a proposal may not act as an independent representative or as responsible officer of a firm or independent partnership for a period determined by the AMF.

The AMF may decide to:

  • Refuse registration;
  • Cancel registration; or
  • Require the appointment of a new responsible officer who meets the solvency requirements, among others.

When and how to declare a bankruptcy or a proposal

Candidates must notify the AMF of their situation when they request an examination registration authorization. They should not wait until their certificate is issued.

Also, representatives should not wait until the renewal of their certificate to declare any change to any information or documents previously provided to the AMF.

Inform the AMF within 5 days

Representatives must send the Statement of Bankruptcy or Insolvency (pdf - 233 KB)This link will open in a new windowUpdated on March 22, 2025 and the required supporting documents within five days of declaring bankruptcy or filing a proposal.

Representatives who are registered for AMF E-Services must:

  1. Sign in to E-Services
  2. Validate the information in the identification section
  3. Select Other applications/requests
  4. Select Other applications - Compliance
  5. Attach the scanned form and supporting documents
  6. Submit the application

Representatives who are not registered for AMF E-Services may:

  1. Register for E-Services by following these steps; OR
  2. Send their documents by mail.
Warning

The AMF must be informed within five daysAccording to section 62 This link will open in a new window of the Regulation respecting the issuance and renewal of representatives’ certificates after bankruptcy is declared or a proposal is filed.

End of the warning
Insight

Is the representative attached to a firm?

Any information provided to the AMF remains confidential. However, the AMF advises representatives to inform the firm they are attached to of their situation.

End of the insight

The AMF analyzes your file

The AMF analyzes the causes and circumstances surrounding the situation based on the information and documents that are provided to it or that it may obtain from the Office of the Superintendent of Bankruptcy.

Special attention is paid to the following:

  • The reasons the representative declared bankruptcy or filed a proposal
  • The types of debt, particularly if financial services participants (individuals or entities) are creditors in the bankruptcy or proposal
  • The cumulative number of bankruptcies or proposals

Unless the AMF indicates otherwise, the representative may continue to practise while the file is being analyzed.

Any change in the representative’s financial circumstances must be reported to the sponsoring firm so that it can update the representative’s registration information in the National Registration Database (NRD) within 15 days of the change.

For details about their obligations, representatives can contact their sponsoring firm or read the applicable regulations.

Warning

Representatives must also complete the Statement of Bankruptcy or Insolvency (pdf - 233 KB)This link will open in a new windowUpdated on March 22, 2025 and submit it via AMF E-Services or send it by mail (see the procedure).

End of the warning

When and how to update bankruptcy or proposal information provided to the AMF

Inform the AMF within 5 days

Representatives must send a Statement of Bankruptcy or Insolvency (pdf - 233 KB)This link will open in a new windowUpdated on March 22, 2025 and/or the required supporting documents to the AMF within five days of any change to any previously provided information or document concerning a bankruptcy or proposal.

Representatives who are registered for AMF E-Services must:

  1. Sign in to E-Services
  2. Validate the information in the identification section
  3. Select Other applications/requests
  4. Select Other applications - Compliance
  5. Complete the “Description” field in order to justify their application
  6. Attach any relevant documents
  7. Submit the application

Representatives who are not registered for AMF E-Services may:

  1. Register for E-Services by following these steps; OR
  2. Send their documents by mail.

Any change in the representative’s financial circumstances must be reported to the sponsoring firm so that it can update the representative’s registration information in the NRD within 15 days of the change.

For details about  their obligations, representatives can contact their sponsoring firm or read the applicable regulations.