Ottawa, May 26, 2010
Finance Minister takes key step in establishing a Canadian Securities Regulator
The Government of Canada today released the proposed Canadian Securities Act, marking a key step towards a long-standing commitment to establish a Canadian securities regulator.
Reflecting the Government’s willingness to work collaboratively with provinces and territories, this is a voluntary regime, which enables provinces and territories to opt in at their choice.
The proposed Act reflects the input of 10 participating provinces and territories, and the Government invites the remaining provinces to join the initiative.
“Canadians, who rely on capital markets for their savings and retirement plans, deserve the protection of strong regulation that reaches all parts of our country,” said the Honourable Jim Flaherty, Minister of Finance. “The proposed Act we have released today brings us closer to the regime that markets demand and that Canadian investors need.”
As Canada’s performance during the global financial crisis demonstrated, our financial regulatory regime is a sound model for other countries. However, Canada is the only major industrialized country that lacks a national securities regulator. Our financial system can be strengthened by the establishment of a national securities regulator to oversee Canada’s capital markets. This step will strengthen the stability, integrity and effectiveness of the Canadian financial system.
The proposed regime will provide:
The proposed Canadian Securities Act is built on provincial securities regulation and harmonizes existing legislation in the form of a single statute. It benefits from the work of the Expert Panel on Securities Regulation (the Hockin Panel) and other reform efforts, and reflects domestic and international best practices. It proposes significant improvements in terms of governance, adjudication, financial stability, and regulatory and criminal enforcement, and provides a wide scope of authority to regulate financial instruments and participants in capital markets.
“The Canadian Securities Transition Office led the work on the proposed Canadian Securities Act in consultation with participating provinces and territories and key stakeholders,” said Minister Flaherty. “I would like to recognize its Chair, Doug Hyndman, its Vice-Chair, Bryan Davies, and the Executive Vice-President and Senior Policy Advisor, Larry Ritchie, for their hard work over many months. I would also like to acknowledge the important contributions of the members of the advisory committee of the 10 participating provinces and territories and their regulators and governments.” These provinces and territories are British Columbia, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island, Saskatchewan, Northwest Territories, Yukon and Nunavut.
The new regulator will take advantage of the expertise and infrastructure of participating provinces and territories. The organization will be an agency with a strong network of local offices whose staff members are authorized and empowered to make key decisions that reflect local market demands.
The Transition Office will release a detailed transition plan during the summer to help ensure a smooth and orderly transition.
Concurrent with releasing the proposed Canadian Securities Act, the Government has referred the proposed Act to the Supreme Court of Canada for its opinion on the following question: Is the annexed proposed Canadian Securities Act within the legislative authority of the Parliament of Canada?
“The opinion will provide legal certainty to all provinces, territories and market participants,” said the Honourable Rob Nicholson, Minister of Justice and Attorney General of Canada.
Should a favourable ruling be received from the Supreme Court of Canada, the Government of Canada intends to introduce for adoption in Parliament a Securities Act, which would then go through the normal parliamentary legislative process.
For further information, media may contact:
Office of the Minister of Finance
Department of Finance
To receive e-mail notification of all news releases, please register at www.fin.gc.ca/scripts/register-eng.asp