What is the main function of the Passport System?

• A. To standardize financial reporting across countries
• B. To ensure compliance with international regulations
• C. To remove duplication in the review of filings across jurisdictions
• D. To manage investment portfolios for regulators

Answer: (C)

The primary function of the Passport System is to remove duplication in the review of filings across jurisdictions. This system facilitates a streamlined process for financial entities operating in multiple jurisdictions by allowing them to submit a single set of documents for review, which can then be recognized by other jurisdictions. This helps to reduce redundancy in regulatory oversight, saving time and resources for both the entities involved and the regulatory bodies.

By minimizing duplicated efforts in the filings process, the Passport System enhances efficiency and encourages more cohesive international business practices. It allows for better coordination among regulatory bodies, which aligns well with the increasing globalization of financial services. This efficient handling of filings ultimately supports the integrity and effectiveness of the regulatory framework in the finance sector.

The other options, while relevant to regulatory functions, focus on other aspects of compliance and management that do not capture the primary role of the Passport System. For example, standardizing financial reporting and ensuring compliance with regulations are broader goals that may be affected by such a system but are not its main function. Similarly, managing investment portfolios for regulators is unrelated to the documentation and approval process that the Passport System addresses.