The federal government has touted the addition of two more provinces — Saskatchewan and New Brunswick — as a significant step towards the creation of a national securities regulator.
But without buy-in from Alberta and Quebec, the development won’t change how Canada’s current system of provincially-regulated securities commissions operates.
“New Brunswick and Saskatchewan are small players in terms of capital markets,” said Marion Shaw, a Vancouver lawyer with Bull, Housser and Tupper who specializes in corporate finance and securities.
On July 9, Finance Minister Joe Oliver announced that Saskatchewan and New Brunswick had committed to join British Columbia and Ontario in a proposed national regulator. The premiers of Alberta and Quebec both released statements condemning the proposed national system.
“I don’t know that it actually adds much to add incremental minor players, until they can get Alberta and Quebec onside,” Shaw said.
Those provinces have so far held out, fearing revenue losses and loss of control over regulation of their distinct markets, Shaw said.
“Even with Saskatchewan and New Bunswick on board, the four provinces together oversee something like 53% of Canadian listed issuers market cap,” Shaw said. “I wouldn’t regard that as a critical mass when you have another 40% sitting in Alberta and Quebec.”
However, Shaw noted that B.C. had once had similar concerns and had “apparently gotten over that.”
The national securities regulator is expected to be up and running by fall 2015.
