By James Langton

(April 12 – 11:55 ET) – If size matters, readers should be pleased with the Ontario Ministry of Finance’s new consultation on the proposed merger of the Ontario Securities Commission and the Financial Services Commission of Ontario.

Finance today released a whopping 241-page consultation document on the issue, almost 10 times larger than the little 26-pager that attempted to broach the issue back last fall. The new draft sets out specific proposals, but it is also intended as a work in progress. Written submissions are due by June 29, with John O’Toole, parliamentary assistant to the minister handling the issue.

The draft proposes to set up a new corporation to be known as the Ontario Financial Services Commission, establishing a single authority for the regulation of financial services in Ontario. The new commission would provide regulatory services with a view to protecting the public interest, protecting consumers of financial services and products, enhancing public confidence in the regulated sectors, and fostering a fair, efficient, and effective financial services marketplace.

The OFSC would provide co-ordinated regulation of:

  • all market participants, including self-regulatory organizations;
  • all co-operatives, credit unions and caisses populaires;
  • everyone governed by the Insurance Act;
  • mortgage brokers; and
  • those who administer pension plans or pension funds.

The new agency would have rulemaking power. It could also commence investigations and would have the power to examine the financial affairs of anyone under investigation.

The consultation draft provides for the appointment of members of the commission by the Lieutenant Governor in Council for a maximum term of five year. The merged commission would be governed by a board of up to 18 directors, including a chairman and up to three vice-chairmen. There would be a Superintendent of Pensions and a Superintendent of Insurance to carry out the regulatory duties for those sectors.

The commission and the Minister of Finance would sign a memorandum of understanding within one year of the merger and every five years after that, setting out the roles and responsibilities of each party and their accountability relationship. The Minister would have to appoint an advisory committee within three years of the merger and within each subsequent five-year period, to review the legislation under which the commission operates.