Canada: Debate Continues Regarding Proposed Cooperative Capital Markets Regulatory System

On July 9, 2014, on what Finance Minister Joe Oliver called "a landmark day" for reforming Canada's capital markets regulatory regime, the federal government announced that Saskatchewan and New Brunswick had agreed to join Canada, British Columbia and Ontario in the Cooperative Capital Markets Regulatory System (CCMR). The announcement follows on the September 19, 2013 agreement-in-principle between the governments of Canada, British Columbia and Ontario to jointly establish a single operationally independent cooperative regulator to administer provincial and federal capital markets legislation. With the addition of Saskatchewan and New Brunswick, the federal government can now boast that four provinces, representing approximately three-quarters of Canadian listed companies with a market capitalization of almost 53 percent, have agreed to sign on to the initiative. At the same time, the federal government renewed its invitation to all other provinces and territories to participate.

The goal of the CCMR is to eliminate the inefficiencies that are endemic to Canada's current system of 13 separate securities agencies. The CCMR reflects the federal government's response to a 2011 Supreme Court of Canada decision, which held that the federal government's first attempt to enact federal legislation to establish a national securities regulator was unconstitutional.

The principal components of the CCMR, as first set out in the Agreement-in-Principle signed by the governments of Canada, British Columbia and Ontario in September 2013, include:

  • Uniform provincial and territorial legislation: a uniform act of each provincial or territorial participating jurisdiction addressing all matters of provincial or territorial jurisdiction in the regulation of capital markets (the "provincial legislation").
  • Complementary federal legislation: complementary federal legislation applying throughout Canada addressing criminal matters and matters relating to systemic risk in national capital markets and national data collection (together with the provincial legislation, the "Cooperative Legislation").
  • Single Regulator: a single operationally independent cooperative capital markets regulator, with an expert board of directors, a regulatory division and an adjudicative tribunal, that administers the provincial and federal legislation and a single set of regulations under authority delegated by the participating jurisdictions. There would be one chief regulator that would serve as the chief executive officer of the regulatory division of the CCMR and whose responsibilities would include recommending the deputy chief regulators to the board (initially it was agreed that the deputy chief regulators would be based in each of Ontario and British Columbia, as well as Québec and Alberta should those jurisdictions choose to participate).
  • Council of Ministers: a council comprising the Ministers responsible for capital markets regulation in each provincial participating jurisdiction and the Minister of Finance of Canada that oversees the CCMR, that is accountable to the participating jurisdictions for the exercise of the CCMR's regulatory powers and to which the board of directors is accountable for the exercise of its regulatory powers.
  • Adjudicative Tribunal: an adjudicative tribunal that would have sufficient members to conduct hearings in English and French across Canada. All of the members would be independent and the tribunal, as a whole, would possess the requisite capital markets and adjudicative expertise.
  • Offices: regulatory offices in every province that is a participating jurisdiction, providing the same range of services that are currently provided in those offices. The executive head office would be located in Toronto.

In connection with Saskatchewan and New Brunswick deciding to participate, the parties have agreed to certain enhancements to the CCMR through an Amended Agreement-in-Principle. These include:

  • There will be two additional regional deputy chief regulators representing capital markets jurisdictions in each of Western and Eastern Canada. Initially they will be located in Saskatchewan and New Brunswick and serve a term of five years. These would be in addition to the deputy chief regulator based in each of British Columbia and Ontario, as well as Alberta and Québec should they choose to participate.
  • Each regulatory office would be led by a director with the responsibility to carry out the office's regulatory functions and identify local issues for their respective Deputy Chief Regulator's consideration in the development and application of national policies.
  • Fundamental changes to the CCMR will require unanimous approval of the proposed Council of Ministers during the initial three-year period after the date on which the Capital Markets Regulatory Authority commences operations, and approval of at least two-thirds of the Council of Ministers and all major capital markets jurisdictions thereafter.
  • The regulator will consider requests to accommodate provincial economic development initiatives, provided they do not adversely affect the fundamental principles of the CCMR or affect markets participants in other jurisdictions.

The parties have agreed to take all actions necessary to give effect to the Amended Agreement-in-Principle, including entering into services agreements for the interim provision of services to the CCMR by an integrated financial regulatory/consumer protection authority in the participating jurisdictions to assist in administering the Cooperative Legislation and delivering regulatory services for a period of three years. 

The parties announced that they expect to issue initial draft regulations by December 19, 2014 (revised from March 31, 2014) and enact provincial and complementary federal legislation by June 30, 2015 (revised from December 31, 2014), with an expectation that the CCMR will be operational before the fall of 2015 (revised from July 1, 2015).

Reaction to the federal government's announcement was swift and predictable: almost immediately those who had previously expressed support for the initiative reiterated their support. Leading industry associations, such as the Investment Industry Association of Canada, the Canadian Council of Chief Executives, the Canadian Bankers Association and the Portfolio Management Association of Canada, lauded the announcement and encouraged other provinces to seriously consider participation. The Hon. John Manley, President and CEO of the Canadian Council of Chief Executives, suggested that Canada's attractiveness as a destination for business investment would be strengthened by "modernizing the existing patchwork of regulators."

Québec and Alberta, on the other hand, dismissed the announcement, reiterating their preference for a provincially led approach.

The reaction from Québec and Alberta should come as no surprise. Québec had already indicated an intention to challenge the proposed legislation in Canada. During the past year, Alberta announced its own proposed model for securities regulatory reform, being a structure that would see the retention of provincial commissions and agencies, along with: (i) the creation of a national capital markets enforcement agency headquartered in Toronto to assist in the enforcement of criminal laws; (ii) a national systemic risk committee chaired by the federal government; (iii) the replacement of commission-based adjudicators by a national and independent adjudicative panel; and (iv) the Canadian Securities Administrators (CSA) to be overseen by a national Council of Ministers and associated administrative bodies.

The Ministers participating in the CCMR are emphasizing momentum, and have reiterated their invitation for other jurisdictions to join the initiative. In the meantime, securities regulators across Canada continue to do business within the existing structure, principally through their active participation in the CSA (a point emphasized recently by the British Columbia Securities Commission in its 2013/2014 Annual Report [released on July 23, 2014]). However, the Chairman and CEO of the Alberta Securities Commission (ASC) pointed out in the ASC's 2014 Annual Report (released to the public on July 21, 2014) that the ongoing debate over the structure of reform and contest for national control is making harmonization "an even greater challenge in an environment where securities laws are seen to be appropriate for differing purposes."

It is apparent that reform and structural transformation is inevitable. Market participants are best advised to continue to keep current on these evolving developments.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions