The federal wise persons’ committee may be coming to understand that a national regulator is politically impossible, the new head of the Canadian Securities Administrators says.

Instead, says Steve Sibold, chair of the Alberta Securities Commission, and new chair of the CSA, the solution to the fractured regulatory system may lie in uniform securities legislation.

In a speech in Calgary Tuesday to securities industry executives, Sibold said he will be watching to see where the wise person’s committee, asked by Ottawa to provide a preliminary report on what would constitute the most effective securities regulatory system for Canada, lands on the notion of a single national regulator. Such an idea has been around since the 1930s.

“I note that the federal government has been backing off from that notion to a degree in the media recently,” he said. “As a securities regulator, I prefer to defer to the politicians to determine whether the provinces could or should cede jurisdiction over securities regulation. I suspect, as has happened over the past eight decades, that the politicians may discover that the single regulator concept may be exceedingly difficult, if not impossible, to implement. Ultimately, in the words of Plutarch, they may find that the “cure is not worth the pain.”

Sibold conceded that market participants still complain that securities regulation in Canada is inefficient and costly. “While I maintain that Canada’s securities regulatory system has come a long way and is one of the more effective systems in the world, there is no question that there is significant room to reduce costs and inefficiencies.”

The CSA’s uniform securities legislation proposal may be the way to achieve lower costs and more efficiency, he said. Launched in the fall of 2001, the goal of the USL project is to prepare a new uniform securities act and accompanying uniform securities rules by the end 2003 so that new legislation can be considered by the provincial and territorial legislatures in the spring of 2004.

He defended the project against critics who have said that it won’t do enough to cut down on the complexity of the rules.

“I have three responses to that criticism. Firstly, as I noted already, the USL Project encompasses a number of reforms – a streamlined act, delegation of decision-making and passport registration – which reforms, in and of themselves, dramatically improve the current system. Secondly, harmonization of what we have today will provide a common platform from which CSA can collectively proceed with reform once the-required analysis and public consultation has been done and consensus has been reached among all CSA members. Thirdly, we must be careful to avoid a scourge of many projects of CSA: “scope creep.”

“All CSA members are committed to streamlining and improving on securities laws. However, at this time, we simply lack a clear consensus at CSA as to how to proceed beyond what is reflected in the USL Concept Proposal,” he said.

Sibold also suggested that once the USL is implemented, the CSA will introduce a more formal mechanism for implementing rules and policies in order to maintain uniformity. “We also hope that the provincial and territorial governments will commit to maintaining uniform securities legislation and enter into a protocol which would govern amendments to the Uniform Securities Act.”


Sibold also defended the effectiveness of the CSA itself. “While much maligned — unfairly in my opinion — CSA is clearly the most effective inter-governmental policy-making organization in Canada. Over the years, the members of CSA have worked together very effectively to develop new policy initiatives and to work towards streamlining and harmonizing securities legislation. USL is one example of a significant CSA harmonization initiative.

“As the new chair of CSA, I am committed to making CSA a more efficient and effective organization.”