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One step closer to a national regulator |
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Written by Lethbridge Herald
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Friday, June 26 2009, 7:52 PM |
Alberta continues to fight the movement toward creation of a national securities regulator, suggesting yet again that a constitutional showdown in court may be preferable to bringing Canada in line with the rest of the industrialized world.
Despite the provincial government’s foot dragging, the federal Conservatives continue working toward that national oversight body, this week selecting a former foe, Doug Hyndman, chairman of the British Columbia Securities Commission, to head a transition office that will begin the process of merging 13 individual regulators into the fold.
So far, the federal Finance Minister Jim Flaherty says the new national body will only work with willing partners in the provinces, giving the stonewalling Alberta and Quebec a way out. Somehow, all need to be convinced to join to make a truly national regulator.
Their nonparticipation would be a shame.
Despite Alberta’s efforts to portray this as some power grab by Ottawa (a good ol’ federal-provincial battle is always good business in Wildrose Country), the new regulator as envisioned by the federal advisory board would be decentralized. This wouldn’t be a Toronto-based organization, but would have head offices around the country, with particular provinces holding responsibility for specific expertise.
Alberta, quite naturally, would have the expertise in the oil and gas markets. B.C. would oversee mining; Ontario, financial services; and Quebec, derivatives. Hardly sounds like a power grab.
Given the times — a recession that shook the world’s financial markets and institutions to their core — the case for stronger accountability and enforcement of securities law is all the more compelling. In the face of a global meltdown in confidence, Canada had no singular body spotting risks in advance or responding to the crisis once it hit.
As Tom Hockin, the chairman of the expert panel on securities regulation, said in January, “Canada’s fragmented system of 13 regulators, none of whom are accountable for the stability of our national markets, is a serious shortcoming in Canada’s system of financial regulation. We will be much better positioned to collaborate and advocate domestically and internationally with a single securities regulator.”
The panel’s report recommended not only a single regulator to replace the patchwork of securities laws across the land, but a system that paid special attention to reducing unnecessary compliance costs, a boost to Canada’s competitiveness for investment.
It is now Hyndman’s task to negotiate with the provinces, but negotiations require both parties to at least sit at the table. So far Alberta appears unwilling to even entertain the possibility. The province has yet to make a solid case against a national regulator.
Businesses and investors frustrated by the status quo should be pressuring their government to change its stance.
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