Canada finance watchdog sets Facebook/Twitter rules

Canadian regulators are proposing new guidelines to govern how investment dealers advertise and communicate with clients on popular social media such as Facebook, Twitter and blogs.

The Investment Industry Regulatory Organization of Canada (IIROC) set out the proposed guidelines in a draft notice this week, asking dealers to submit comments within 60 days to help mold the new rules. The six-page draft rules notice updates guidelines on advertising, sales literature and general correspondence that were last modified in April 2004, and refer to issues ranging from record-keeping to the secondary impact of communications with clients. The guidelines also touch on third-party communications, and point at the potential pitfalls of "re-tweeting" a client's post or providing a thumbs-up, both of which might be considered an endorsement. It said static content, like a profile, background or wall information, is usually considered an advertisement, and must be pre-approved.