CALGARY – A vocal proponent of a Canada-wide market regulator says he’s optimistic Alberta will sign on to the idea once it gains momentum.
Ian Russell, head of the Investment Industry Association of Canada, acknowledges Alberta remains skeptical about the plan. But the province will likely feel pressure to join once the proposed watchdog gains “critical mass,” he said in an interview Monday.
Canada is an anomaly amongst its G7 peers because it has 13 separate provincial and territorial capital markets regulators, rather than a single national watchdog.
Ottawa’s push for a national securities regulator hit a wall in late 2011 when the Supreme Court ruled a federally-imposed regulator would encroach on provincial jurisdiction. So last September, the federal, Ontario and British Columbia governments took another run at the idea with a proposed voluntary, co-operative model.
Quebec remains a staunch opponent of the idea and Alberta is still unconvinced.
Russell expects that Saskatchewan, whose economic muscle has grown in recent years, will come on board soon, followed by some of the Atlantic provinces and perhaps Manitoba. That should be enough of a buy-in to get the Co-operative Capital Markets Regulator up and running about a year from now.
At that point, Russell said he expects Alberta won’t want to remain on the outside much longer.
“It would mean that large companies are going to have to register with the co-operative regulator as well as with the province. You’re now moving towards a structure for outlying provinces that’s less than efficient and then it starts to make more and more sense that those provinces should move together in the same direction as part of the national regulator,” he said.
“Up until now it’s been on paper, it’s been a theory, but the way the dynamics are going it is going to become reality and the outlying provinces need to think what that means.”
The proposed watchdog would be steered by a council of ministers, and beneath that, by a board of provincial and territorial appointees. Ottawa would be at the table, but would not have outsized influence, Russell said.
“I don’t think it’s well understood that the co-operative regulator actually provides a lot of regional autonomy to the provinces,” he said.