As part of a push for the harmonization of the current
provincial capital markets legislation across Canada and the
establishment of a single capital markets regulator, the federal
government and the governments of Ontario, British Columbia,
Saskatchewan and New Brunswick announced on September 8, 2014 that
they have signed a memorandum of agreement formalizing the terms of
a Cooperative Capital Markets Regulatory System (the
"CCMR"). The announcement was accompanied by consultation
drafts of the proposed federal and provincial legislation.
As discussed in an
earlier BLG Alert, the CCMR represents a response to the
Reference re Securities Act in December 2011, where the Supreme
Court of Canada indicated that "each level of government has
jurisdiction over some aspects of the regulation of securities and
each can work in collaboration with the other to carry out its
The provincial and federal acts will be administered by a new
regulator, the Capital Markets Regulatory Authority (the
"Authority") which will act in accordance with a single
set of regulations. The Authority will be comprised of a Regulatory
Division responsible for the policy, regulatory operations,
advisory services and enforcement functions and an independent
Tribunal which will adjudicate enforcement and administrative
proceedings. Each participating jurisdiction will have a regulatory
office that will continue to provide the services provided by
securities regulators today.
Supervisory oversight of the Authority will be provided by an
independent board of directors comprised of a range of capital
market experts from across the various regions of Canada. The board
is in turn accountable to a Council of Ministers comprised of a
Minister from each of the participating jurisdictions and the
Minister of Finance of Canada.
The uniform Provincial
Capital Markets Act, which will be enacted by each
participating province and which will replace existing provincial
securities legislation, purports to harmonize the approaches taken
by the various signatory provinces. The complementary federal Capital Markets Stability Act addresses those
areas under federal jurisdiction, equipping the Authority with
national data collection powers to monitor activity in capital
markets and providing the Authority with the requisite tools to
"manage systemic risk related to capital markets on a national
basis". The federal statute will also enact capital markets
related offences currently included in the Canadian Criminal Code.
Both the provincial and federal statutes empower the Authority to
make regulations subject to the oversight of the Council of
While the proposed Provincial Capital Markets Act is largely
consistent with existing provincial securities laws, it adopts a
"platform approach" to capital markets regulation. This
involves setting out the broad strokes of capital market law in the
Provincial Capital Markets Act, while reserving the detailed
requirements (including some of those currently set out in
provincial securities law) for the regulations to be adopted by the
Authority. This approach seeks to promote regulatory flexibility,
better allowing the Authority to respond to new challenges. Draft
initial regulations, which we expect to be consistent with the
existing national instruments, are scheduled to be released by
December 19, 2014.
The proposals were accompanied by a backgrounder and commentary which provide a comprehensive
overview of the CCMR and the new proposals. Comments on the
proposals will be accepted until November 7, 2014.
The federal government and four provincial government
signatories have developed the CCMR to address the perceived
inefficiencies created by Canada's current system of multiple
securities agencies with a view to "foster more efficient and
globally competitive capital markets" subject to common
legislation and a single regulator. Although the signatories have
again renewed their invitation for other provinces and territories
to participate, it remains to be seen whether additional Canadian
jurisdictions join the CCMR.
Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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