The Ontario Securities Commission (OSC) announced on Monday the opening of its combination financial technology (fintech) innovation hub and regulatory sandbox, known as OSC LaunchPad.
The OSC LaunchPad aims to help fledgling fintech companies navigate the complex world of securities laws and help fintech firms get to market faster by ensuring they are building regulatory compliance into their operating plans. To that end, the OSC's new LaunchPad team will provide support and guidance to firms that need it to facilitate innovation in financial services.
At the same time, the OSC indicates that it will also consider providing regulatory relief to startups so that they can experiment with novel products, services and business models, while also ensuring investor protection.
"In appropriate cases, the OSC will consider time-limited registration or exemptive relief for innovators to test their products, services and applications," the OSC's announcement says.
This approach, known as a "regulatory sandbox," has been introduced in other markets, such as the U.K. and Australia, but is a first for Canada.
"This is an exciting opportunity for Canadian innovators. With OSC LaunchPad, emerging fintech businesses now have an opportunity to work with securities law experts from day one," says Maureen Jensen, chairwoman and CEO of the OSC, in a statement. "This initiative reflects the OSC's commitment to regulation that is in step with innovation."
In addition, the OSC indicates that it intends to establish a fintech advisory committee to help the regulator translate its experience with startups into lessons for regulation generally — potentially feeding back into rule changes, or guidance, that aims to modernize regulation. Details on that committee will be announced in the coming weeks, the OSC notes.
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