The Competition Bureau (the Bureau) launched a market study on
May 19, 2016, that will examine the competitive landscape for
technology-led innovation and emerging services in the Canadian
financial services sector.
As financial services providers increasingly incorporate new
technologies when offering services (e.g. P2P, mobile wallet, crowd
funding and "robo" advisors), the Bureau seeks to better
understand the make-up of the Canadian financial technology
(FinTech) industry and factors affecting its growth. A stated focus
is to consider the impact of market forces and the existing
regulatory regime on innovation and competition in the financial
One reason for the study is found in the Bureau's mandate to
advocate the benefits of competition. In recent reviews of
financial sector policy, the federal Department of Finance has
often identified increased competition as a goal with anticipated
public benefits. When the federal government next engages in a
financial sector policy review, the Bureau should be well
positioned to give informed comment about some of the competitive
factors affecting FinTech providers.
Participants in the financial sector and participants in the
technology sector are subject to a mix of federal and provincial
laws that are sometimes based on the form of the entity (i.e.,
regulated financial institution vs. telecom carrier vs. unregulated
service provider), and sometimes based on the activities carried
out. Accordingly, this market study will provide a valuable
opportunity for the Bureau to look at the coming together of
service providers and innovators in the financial sector and the
technology sector, and assess whether the existing regulatory
landscape over- or under-regulates industry participants in ways
that prevent innovation or limit competition.
The Bureau does not intend to study all consumer financial
services that reflect technological innovation. For instance,
insurance, crypto-currencies, payday loans and loyalty programs are
excluded from the study. However, the Bureau has indicated that it
may expand its scope as the study progresses.
The study aims to address the following:
the impact of technology-led innovation on the current and
future competitive landscape for the provision of financial
how consumers will benefit from FinTech;
identifying regulatory or structural barriers to entry for
whether the regulatory framework for financial services
supports or inhibits competition currently;
the sufficiency – and flexibility – of consumer
protections currently in place; and
issues for consideration, from a competition perspective, when
revising existing laws.
The progression of the study will be closely followed by the
financial services industry and FinTech service providers. It is
important for industry participants to participate in the study to
ensure that the Bureau has an accurate and balanced view regarding
the structure and competitive dynamics in the Canadian FinTech
sector. This because, beyond any advocacy initiatives the Bureau
may take, the information obtained through this study will inform
the Bureau's enforcement activities – in particular with
regard to the potential application of the abuse of dominant
position, competitor collaborations and merger review provisions of
the Competition Act.
The results of the study will be published in a Spring 2017
report. In the interim, the Bureau has indicated that it welcomes
submissions (either written or oral) or indications of interest in
participating in an interview process before June 30,
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 Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
The Canadian Competition Bureau issued a template document for use as a form of Consent Agreement, to be filed with the Competition Tribunal to resolve concerns the Bureau may have with proposed mergers.
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).