Canada’s investment managers view Supreme Court ruling as open door for new plan for national securities regulator


Toronto, ON, December 22, 2011 – The Portfolio Management Association of Canada (PMAC) respects today’s decision by the Supreme Court of Canada that clearly paves the way for a more cooperative federalism model if a national regulator is to ever become a reality. The ruling suggests that the next step forward is for the government to develop constitutionally sound legislation that supports streamlined securities regulation in Canada.

“There is more work to be done to move towards a national securities regulator, and the ruling provides some principles and boundaries to move in this direction,” says PMAC President Katie Walmsley.

The courts stated that “a cooperative approach that permits a scheme recognizing the essentially provincial nature of securities regulation while allowing Parliament to deal with genuinely national concerns remains available and is supported by Canadian constitutional principles and by the practice adopted by the federal and provincial governments in other fields of activities”.

“Canadian investors deserve enhanced protection. Just as every Canadian should be entitled to certain consistent standards in transportation and public safety, they should also have equal access and protection within our capital markets—it can only be delivered through harmonized rules and standards,” Walmsley adds.

PMAC has long advocated that Canada adopt one national securities regulator to:

  • Protect against unfair and improper practices and ensure better enforcement against fraud and white-collar crime
  • Establish simplified, consistent national standards for addressing complaints
  • Provide consistency for businesses operating across Canada’s provinces through a clear set of rules that apply from coast to coast
  • Strengthen the financial system by developing faster policy responses to emerging trends
  • Reduce inefficiencies and duplication inherent in operating 13 regulatory structures: minimizing red tape will encourage foreign issuers to include Canada when offering securities
  • Streamline the registration process for advisors by having one national process

Every major industrialized nation in the world has a national securities regulator, except Canada. Many studies over 40 years have proven that our patchwork system (13 regulators, one for each province and territory, plus Self-Regulatory Organizations, SROs) has been inefficient for Canadian investors. The Economic survey of Canada 2008 by The Organisation of Economic Co-operation and Development (OECD) found that having multiple regulators impeded efficiency and decreased Canada’s attractiveness to potential issuers.

“Faced with the onerous regulatory requirements when making Initial Public Offering (IPO) or private distributions in multiple provinces, some international companies choose either not to do so in Canada, or not to do so in all provinces,” says Walmsley. “A model that supports co-operative federalism that streamlines securities regulation would encourage Canadian and international issuers to offer distributions nationally, making more new investment opportunities available to all Canadians.”

In its 2008 submission to the Expert Panel on Securities Regulation, PMAC supported the federal government’s chosen framework of allowing provinces to “opt in” to the national regulator. “Collaboration between the provinces and the federal government is a key success factor. PMAC endorses that model and looks forward to,” Walmsley adds.

About PMAC:

Formerly the Investment Counsel Association of Canada (ICAC), the Portfolio Management Association of Canada (PMAC) represents more than 150 portfolio management companies that oversee more than $800 billion in assets for over one million institutional and high net worth clients. Member firms support private clients, pensions, insurance, foundations and endowments. As one of Canada`s largest financial industry associations, PMAC continues the 50-year tradition of ICAC and operates in both official languages. PMAC’s mission is to advocate the highest standards of unbiased portfolio management in the interest of investors.

PMAC uses a collaborative information-sharing business model and represents its members to securities regulators and government agencies. The Association increases awareness of investment counselling benefits, provides a forum for networking, and keeps members current on regulatory and compliance issues.


For further information:

Contact Margo Rapport
H2 Central Marketing and Communications
Phone: 416-895-5672