Canada: What’s Ahead? - An Outline of Key Developments in Canadian Securities Regulation

Last Updated: October 20 2006
Most Read Contributor in Canada, September 2016



Common Securities Regulator


It’s Time. Wise Persons Committee to review the structure of securities regulation in Canada. Minister of Finance (Canada) December 2003.

Modernizing Securities Regulation in Canada Discussion paper of the Management Board Secretariat (Ontario) June 2004.

A Blueprint for a Canadian Securities Commission. The Crawford Panel on A Single Canadian Securities Regulator June 2006.

Both the Ontario and federal governments confirmed their respective commitments to work towards a common securities regulator in their Spring 2006 Budgets.

Uniform securities regulation


Blueprint for Uniform Securities Laws for Canada. CSA January 2003.

CSA Notice and Request for Comment 11-404 Consultation Drafts of the Uniform Securities Act and the Model Administration Act CSA December 2003.

CSA Notice 11-307 Responses to Comments Received on Consultation Drafts for a Uniform Securities Act and a Model Securities Administration Act CSA September 2004.

Status and next steps unknown, although the CSA is working to harmonize various aspects of securities regulation through national instruments, such as prospectus and registration exemptions (NI 45-106), continuous disclosure obligations (NI 81-106), the fund governance rule (NI 81-107) and the proposed national registration rule (see CSA Registration Reform Project).

Passport System for Provincial Securities Regulation


Securities Regulation in Canada:
An Interprovincial Securities Framework.
Provincial Ministers responsible for securities regulation (Steering Committee) June 2003.

Provincial/Territorial Memorandum of Understanding Regarding Securities Regulation and Action Plan Provincial/Territorial Securities Initiative Action Plan to Improve Canada’s Securities Regulatory Framework September 2004.

Multilateral Instrument 11-101 Principal Regulator

System and Companion Policy 11-101CP Principal Regulator System CSA (other than OSC) August 2005 (published in final form).

CSA Notice 12-309 Impact of the MI 11-101 Principal Regulator System on the Mutual Reliance Review System for Exemptive Relief Applications CSA August 2005.

OSC Notice 11-754 Multilateral Instrument 11-101 Principal Regulator System (etc.) OSC August 2005.

Principal regulator system in force since September 2005 in all provinces and territories, other than Ontario. Issuers and registrants deal only with their "principal regulator" with respect to many disclosure requirements (including NI 81-101 and NI 81-106), although disclosure documents and fees are still required to be filed and paid in all jurisdictions. MI 11-101 not adopted in Ontario. System has no practical effect for investment funds whose managers are located in Ontario. Investment funds whose managers are located outside Ontario deal with the OSC and their principal regulator under MI 11-101. OSC considering implementing similar "mobility registration exemption" to that contained in MI 11-101.

Task Force to Modernize Securities Legislation in Canada


News Release: IDA launches the Task Force to Modernize Securities Legislation in Canada June 2005.

News Release: Task Force to Modernize Securities Legislation to Release Report at October 4 News Conference. September 2006.

IDA created and funded the Task Force. The mandate, terms of reference and membership of the Task Force are posted at its Web site Task Force received written submissions, carried out in-person consultations and commissioned research studies. Its final report is scheduled for October 4, 2006 and will be posted on its website.

Ontario Legislative Review


Five Year Review Committee Final Report: Reviewing the Securities Act (Ontario) March 2003.

Standing Committee on Finance and Economic Affairs Report on the Five Year Review of the Securities Act October 2004.

Ontario provincial government committed to implement specified changes: single securities regulator (see above), civil liability for secondary market disclosure (implemented effective December 31, 2005), role of SROs and adjudicative function of the OSC.

OSC’s 2006/2007 fiscal year priorities include supporting the Ontario government’s initiative for a common securities regulator, a common set of securities laws and a single fee structure for Canadian markets.

British Columbia Securities Legislation


Securities regulation that works (four volume set) British Columbia Securities Commission April 2003.

Bill 38 British Columbia Securities Act passed by BC Government May 2004; proclamation deferred until December 31, 2007.

News Release 2006/05 Securities Laws to be Harmonized Across Canada BCSC February 2006.

BC government has deferred implementation of the new securities legislation in British Columbia until at least December 31, 2007 to allow provincial securities regulators to fully participate in the passport regulatory system.

CSA Registration Reform Project


The Fair Dealing Model Concept Paper of the Ontario Securities Commission January 2004.

CSA News Release: Canadian Securities Regulators launch Registration Reform Project Web site June 2005.

CSA Registration Reform Project Proposal on Registration Reform February 2006.

CSA Registration Reform Project Proposal on Registration Reform – Part II July 2006.

CSA Registration Reform Project established in Fall 2004 as a follow-on project to the Fair Dealing Model. See

The CSA Registration Reform Project includes implementing the CSA National Registration System (in force April 2005), implementing three "core principles" from the Fair Dealing Model and "harmonizing, streamlining and modernizing registration requirements (including categories of registration)."

The three "core principles" of the Fair Dealing Model being developed by the CSA in conjunction with the SROs are: clarity and transparency regarding relationships, transparency of costs and conflicts and transparency regarding performance and risks.

A national registration requirements rule being developed. Proposals for registration reform include registration of fund managers in a new registration category, removal of barriers to incorporation of sales representatives and streamlined categories of registration. A draft rule is expected to be published for comment Winter 2006/07.

Limited Market Dealers


OSC Staff Notice 11-758 Review of Limited Market Dealers OSC June 2006.

National roll-out of limited market dealer regime being considered as part of CSA Registration Reform Project.

See OSC Staff Releases Deficiency Report on Limited Market Dealers Registrant Regulation and Compliance Alert, Investment Management Advisory June 2006 Borden Ladner Gervais LLP.

Regulatory Compliance by IC/PMs


2006 Report Compliance Team, Capital Markets Branch OSC September 2006.

Common deficiencies and proposed regulatory action noted for entities registered as advisers: investment counsel and portfolio managers.

See OSC Staff Releases Compliance Report on Advisers Registrant Regulation and Compliance Alert, Investment Management Advisory September 2006 Borden Ladner Gervais LLP.

Investment Fund Manager Compliance


Report on Mutual Fund Trading Practices Probe Ontario Securities Commission March 2005.

Canadian securities regulators are expected to propose that investment fund managers implement a compliance program. Proposed guidance on fair value pricing will also be provided. Draft rules to be incorporated with the proposed registration rules.

See Ontario Securities Regulators Wrap Up Probe into Mutual Fund Trading Practices The Material Change Report Summer 2005 Borden Ladner Gervais LLP.

Investment Fund Governance


National Instrument 81-107 Independent Review Committee for Investment Funds CSA July 2006 (published in final form).

Expected to come into force November 1, 2006 (subject to government approvals). IRCs to be established within six months of effective date of National Instrument and fund managers and IRCs given a further six month period for complete compliance with the rules.

See Canadian Investment Fund Governance Becomes Reality: Final National Instrument 81-107 Released Investment Management Advisory August 2006 Borden Ladner Gervais LLP; and BLG’s ten-part series of Practice Bulletins entitled BLG’s Countdown to Governance: Getting Ready, June 2006 to September 2006.

Investment Fund Continuous Disclosure


National Instrument 81-106 Investment Fund Continuous Disclosure CSA March 2005 (NI and CP, and consequential amendments to certain other NIs, published in final form).

Canadian Securities Administrators Staff Notice 81-315 Frequently Asked Questions on National Instrument 81-106 Investment Fund Continuous Disclosure November 2005.

In force June 1, 2005, with effect for investment funds with financial years ending on or after June 30, 2005. OSC to implement a continuous disclosure review program.

See Working with the New Canadian Continuous Disclosure Rules for Investment Funds Investment Management Advisory April 2005 Borden Ladner Gervais LLP.

Canadian Accounting Standard Change


Handbook of Canadian Institute of Chartered Accountants Section 3855 Financial instruments - recognition and measurement April 2005.

In the Matter of AGF Funds Inc. et al Decision Document of Canadian securities regulators dated September 28, 2006.

Decision document of Canadian securities regulators exempts all applicable investment funds from the application of section 14.2 of National Instrument 81-106 when calculating net asset value for the purposes of pricing securities for specified time period. New financial instrument accounting standard has effect for entities for their financial years commencing on and after October 1, 2006.

Scholarship Plan Dealers’ Business Practices


OSC News Release OSC Acts to Improve Scholarship Plan Dealers’ Business Practices July 2004.

Industry Report Scholarship Plan Dealers Compliance Team, Capital Markets, Ontario Securities Commission July 2004.

Continued monitoring of scholarship plan dealers by OSC (terms and conditions). Proposed National Instrument 46-102 to modernize the scholarship plan regime, including improved point of sale disclosure, a priority for the CSA. Proposed NI 46-102 is scheduled for publication for comment before March 31, 2007.

Labour-Sponsored Investment Funds


News Release (Ontario) Ontario Plans to End Tax Credit for Labour Sponsored Investment Funds Ministry of Finance August 2005.

Ontario government 2006 Spring Budget contains several initiatives related to the phase-out of the tax credit (which will continue until year end 2010).

Capital Accumulation Plans Guidelines and Proposed Exemptions for Mutual Funds


Joint Forum of Financial Market Regulators Guidelines for Capital Accumulation Plans May 2004.

CSA Request for Comment Amendments to National Instrument 45-106 Prospectus and Registration Exemptions and Adoption of Local Prospectus and Registration Exemptions for Certain Capital Accumulation Plans CSA October 2005.

Guidelines are final, with implementation on or as of December 2005. All Canadian regulators, other than the OSC and the Quebec regulator, granted "blanket" prospectus and registration exemptions to allow mutual funds to be used as investment options for CAPs. Comment period on proposed amendments to NI 45-106 ended January 19, 2006. Comment letters, including comment letter of Borden Ladner Gervais LLP, being considered by CSA.

Point of Sale Disclosure for Mutual Funds and Segregated Funds


CSA Notice 81-311 Report on Consultation Paper 81-403 Rethinking Point of Sale Disclosure for Mutual Funds and Segregated Funds April 2004.

CSA response provided to comments on February 2003 consultation paper. CSA developing a fund summary document, a foundation document and new cooling off rights. CSA working on draft national instrument to propose new disclosure requirements and introduce new cooling-off requirements. To be published for first comment during 2006/07.

Straight-through Processing


Canadian Securities Administrators Notice and Request for Comment on Proposed National Instrument 24-101 Institutional Trade Matching and Settlement and Proposed Companion Policy 24-101CP CSA March 2006.

Comment period ended May 2, 2006. CSA considering comments received.

Best Execution and Soft Dollars


Concept Paper 23-402 Best Execution and Soft Dollar Arrangements Ontario, British Columbia, Alberta and Manitoba Securities Commissions and the Autorité des marchés financiers du Québec February 2005.

CSA Notice 23-303 Update on Concept Paper 23-402 Best Execution and Soft Dollar Arrangements December 2005.

Proposed National Instrument 23-102 Use of Client Brokerage Commissions as Payment for Order Execution Services or Research ("Soft Dollar" Arrangements) CSA July 2006.

Comment period ends October 19, 2006.

Hedge Funds and other AlternativeInvestment Products


Regulatory Analysis of Hedge Funds
Hedge Funds Working Group Investment Dealers Association of Canada May 2005.

MFDA MR-0048 Know-Your-Product MFDA October 2005.

CSA Notice 46-303 Principal Protected Notes July 2006.

OSC working with CSA to identify areas of concern arising out of its review of hedge funds and similar products. Regulatory responses may be proposed, although the OSC chair acknowledged in a speech presented in February 2006 that "hedge funds per se do not require their own separate regulatory regime".

Regulation of Derivatives


Regulation of Derivatives Markets in Quebec
Autorité des marchés financiers May 2006.

Interim Report Ontario Commodity Futures Act

Advisory Committee May 2006.

Both reports were released for public comment and the comment periods for both reports ended in July 2006.

Further consultations can be expected.

BLG's Investment Management Group leaders are:
John E. Hall - National Leader, Brad J. Pierce - Calgary Regional Leader, Richard W. Shannon - Montréal Regional Leader, Jeremy S.T. Farr - Ottawa Regional Leader, Lynn M. McGrade - Toronto Regional Leader and Jason J. Brooks - Vancouver Regional Leader

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
Check to state you have read and
agree to our Terms and Conditions

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.

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 by clicking here .

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.


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.