Final answer:
IIROC and other SROs offer arbitration to investors primarily when there is an unresolved dispute with their investment firm or advisor that involves alleged regulatory breaches leading to investor losses. Arbitration is a voluntary process and may lead to compensation for the investor if the arbitrator rules in their favor. This typically occurs after other internal dispute resolution avenues have been exhausted.
Step-by-step explanation:
The Investment Industry Regulatory Organization of Canada (IIROC) and other Self-Regulatory Organizations (SROs) provide investors with a means to resolve disputes through an arbitration process. This process is typically offered when there is a dispute between an investor and their investment firm or advisor and they are unable to resolve it internally. Investor loss must be due to actions or failures by the firm or advisor that are in breach of their regulatory requirements. Arbitration may lead to compensation if the ruling is in favor of the investor. It's important to note that arbitration is a voluntary process and both parties must agree to it before it can proceed.
IIROC provides a detailed arbitration program that is designed to offer a quicker, more cost-effective alternative to the traditional legal system. Arbitration through IIROC or other SROs is generally considered when the investor's claim is within the monetary limits set by the SRO and when other means of resolving the dispute have been exhausted.