Two Small Provinces Join Canadian National Securities Regulator

Jul 11 2014 | 6:21am ET

Canada’s plan to build a national securities regulator took two more steps towards reality this week, albeit small ones.

New Brunswick and Saskatchewan have agreed to give up their provincial regulators and join the national one, set to debut next year. The two join Ontario and British Columbia in the endeavor, which seeks to end Canada’s status as the only major industrialized country with a single national securities regulator.

“Today’s agreement is a major step towards a single regulator, national in scope, that will enhance Canada’s capital markets,” Finance Minsiter Joe Oliver said, urging the country’s other six provinces and its three territories to join the unified agency.

Such does not seem likely: Alberta’s finance minister, Doug Horner, blasted the plans, saying that it “confirms our longstanding fear that Ottawa will proceed with changes to Canada’s securities regulation system without the support of two of its largest markets, Alberta and Québec.”

“This will leave Canada with a more fractured system than the one we have today,” he added. “We do not believe that four provinces constitute a critical mass of support for a change of this magnitude.”

Québec has also expressed opposition to the plan, and plans to sue to stop it.

The four provinces joining the regulator account for about 55% of Canada’s market capitalization and three-quarters of the issuers on the Toronto and Vancouver stock exchanges. New Brunswick and Saskatchewan only account for about 4% of the market cap, but give the regulator a foothold in both Canada’s Maritime provinces—where New Brunswick’s regulator is the largest—and in the Prairie provinces, home to Canada’s massive oil and gas business.

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