Now is the time to “fill or kill” the Co-operative Capital Markets Regulatory System (CCMR). This unrealized vision of national regulation has been left to languish for far too long.
Seven years have passed since British Columbia, Ontario and the federal government announced plans to launch a new co-operative regulator with any other provinces willing to join. The original launch date was supposed to be July 2015, a missed deadline that had its fifth birthday this summer.
More depressing, David Brown, former head of the Ontario Securities Commission (OSC), first floated the idea of a pan-Canadian regulator almost 20 years ago at the OSC’s annual policy conference in 2001.
From the start, the CCMR effort has been hamstrung by lack of decisive political leadership. In some ways, that was by design. Establishing a national regulator with a coalition of willing participants was intended to be a clever way to avoid the constitutional thicket that plagued previous efforts to achieve the same goal in a realm that traditionally has been provincial jurisdiction.
The CCMR’s voluntary, soft-sell approach passed muster with the Supreme Court of Canada. But the CCMR has fallen victim to inertia. While some provinces have nominally joined the effort, the decisive action required to make the CCMR a reality has yet to materialize.
Allowing the CCMR to trundle along with no discernible purpose — except to serve as a sinecure for veteran regulators — has been a harmless if costly exercise.
Now, however, with a task force in Ontario examining a sweeping overhaul of capital markets regulation, the CCMR isn’t an innocuous sideshow anymore. Spinning out the OSC’s tribunal, revising its mandate and restructuring its governance is inextricably tied to whether or not the CCMR is viable. You don’t renovate a house you’re planning to abandon.
If the political will to carry the CCMR to fruition exists, now is the time to use it. Otherwise, policy-makers should kill the CCMR and clear the way for optimizing the model we have.