On May 19th the Competition Bureau announced it has launched a
market study of Canada's financial services technology
("FinTech") sector to determine whether
it should be more closely regulated. According to the Bureau,
FinTech innovations provide more choice by unbundling existing
products and services and introducing new ones that can result in
more efficient services, lower fees and greater savings for
The study will focus on:
how innovation is affecting the way
consumers and businesses use financial products and services,
the competitive impact that FinTech
is having on the financial services industry,
the barriers to entry for companies
working in FinTech, and
whether regulatory reform is needed
to promote greater competition while maintaining consumer
confidence in the financial services industry.
Regulation of FinTech in Canada
While the Federal government regulates banking in Canada through
the Office of the Superintendent of Financial Institutions (OSFI),
other components of banking are overseen by separate provincial and
Canada's FinTech industry is already subject to regulation;
however, the technology has started to outpace the existing
regulation such that some financial products are not covered.
The study will assess current regulation. The Competition Bureau
will use the results of the study to determine how to best allocate
responsibility for regulation between provincial and federal
institutions. Interested stakeholders are invited to make a
submission to the Bureau before June 30, 2016.
The content of this article does not constitute legal advice
and should not be relied on in that way. Specific advice should be
sought about your specific circumstances.
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Canada's Commissioner of Competition, John Pecman, addressed the link between competition and innovation and provided updates on the Fintech market study launched by the Competition Bureau earlier this year.
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