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September 19, 2013
OTTAWA – The ministers of finance of British Columbia, Ontario and Canada agreed today to establish a co-operative capital markets regulatory system and invite all provinces and territories to participate in the proposed system.
The co-operative securities regulator will better protect investors, enhance Canada’s financial services sector, support efficient capital markets and manage systemic risk. It will feature a single regulator administering a single set of regulations and be operationally independent and self-funded through a single set of fees. It will be directed by an expert board of independent directors with broad capital markets-related expertise. A council of ministers of all participating jurisdictions will oversee the co-operative system.
The regulator will have an executive head office in Toronto and a nationally integrated executive management team, ensuring policy leadership from regulatory offices. The regulatory offices will provide the expertise and capacity needed to serve market participants in all participating jurisdictions.
The ministers agreed that the co-operative system will preserve the elements of the current system that work well, including the ability to weigh and consider local perspectives, and will achieve needed reforms within a national context.
By pooling provincial and federal expertise, the co-operative securities regulator will contribute to a stronger economy, improve investor protection and better respond to increasingly competitive, dynamic and global capital markets.
“B.C. has consistently supported the concept of a co-operative securities regulatory system that respects constitutional jurisdiction, builds on the strong foundation of the current system, improves enforcement, and is responsive to regional markets such as B.C.’s venture capital markets,” said Michael de Jong, B.C. Minister of Finance. “This agreement meets those principles and priorities. I hope other jurisdictions give serious consideration to joining the co-operative system.”
“A co-operative securities regulator based in Toronto will provide increased protection for investors, strengthen the competitiveness of Canada’s economy, lower costs and enhance the reputation of Canada’s financial services sector leading to more jobs and growth,” said Charles Sousa, Ontario Minister of Finance. “Ontario has for many years taken a leadership role in the creation of a co-operative securities regulator because it is in the best interests of all provinces and will help our businesses grow.”
“This is a commendable example of cooperative federalism working to address today’s market realities,” said Government of Canada Finance Minister Jim Flaherty. “All of us listened and we came together, putting aside our differences to focus on a common goal: to modernize our capital markets and to make them more competitive. I want to thank ministers de Jong and Sousa for their leadership on this initiative.”
Agreed elements of a co-operative capital markets regulatory system
The ministers of finance of British Columbia, Ontario and Canada have agreed to establish a co-operative capital markets regulatory system and invite ministers responsible for securities regulation in all provinces and territories to participate in the co-operative system that includes the following elements:
- Regional and market sector perspectives should be weighed and considered in major policy and operational decisions by including regionally based staff in developing policy approaches and operating priorities and processes.
- The regulator should foster an environment that helps recruit and retain in all offices talented and qualified staff who will embrace the vision for the organization and work to fill its mandate.
- The regulator should promote a culture of innovation that values ideas and perspectives from all offices and from other sources (including investors, market participants and other stakeholders) that contribute to delivering better and more cost-effective regulation.
The full text of the agreement in principle is available here: http://www.fin.gc.ca/pub/ccmrs-scrmc/agreement-principle-entente-principe-eng.asp
Ministry of Finance