National and Coordinated Approaches to Securities Regulation: The Latest Initiatives in Historical Context

If securities regulation is any indication, few countries in the world take their federalism as seriously as Canada does. Notwithstanding an increasingly globalised world, the central reality of Canadian federalism will continue to influence the enactment and enforcement of effective capital markets regulation. In the latest development, on September 8, 2014 the federal government and four participating provinces announced draft legislation, including a new uniform provincial act and new federal legislation, to establish a new Cooperative Capital Markets Regulator (CCMR). Some provinces are strongly opposed, including Québec, which has promised to challenge the proposed regime on constitutional grounds. This chapter surveys Canadian efforts at nationalisation or coordination of securities regulation over the last eight decades. This historical analysis locates current reform efforts in context and compares those efforts, in detail and on the merits, with prior attempts to establish a national or common regulator, statute, or both. The chapter considers the Supreme Court of Canada’s important 2011 decision in Reference re Securities Act, including the question of exactly what it might mean for the federal government to “manage systemic risk” in the capital markets. The chapter then assesses the options available after the Reference, including but not limited to the proposed CCMR, along with the political, administrative and political considerations that will affect any regime going forward. This is a draft chapter in the fifth edition of Securities Regulation in Canada, now forthcoming (2014). As Governor General of Canada, His Excellency David Johnston has refrained from expressing opinions on matters that are currently under public policy discussion. Any views or recommendations on policy changes in this chapter or in the text as a whole are those of Kathleen Rockwell and Cristie Ford, and should not be attributed to His Excellency. As well, the opinions stated here should not be taken to be those of anyone at the Alberta Securities Commission other than Kathleen Rockwell herself