OTTAWA (Reuters) - Finance Minister Jim Flaherty pledged on Tuesday to press ahead with the idea of a single, national securities regulator, despite provincial foot-dragging and opposition from Quebec separatists.
“We have a capital-markets regulatory system that is out of step with the Western world,” Flaherty said during parliamentary debate on a Bloc Quebecois motion calling on the government to “immediately abandon” the concept.
“We are the only industrialized country that does not have a common securities regulator. Our system of 13 regulators is cumbersome, fragmented and it lacks the proper tools of enforcement.”
The Bloc, which advocates independence for Quebec, jealously seeks to guard the prerogatives of the largely French-speaking province and believes the common securities regulator would step on provincial toes.
“The Conservative government and especially the current finance minister seem to have an obsession with removing important Quebec rights in financial administration and regrouping them in Toronto,” the Bloc’s Paul Crete told the House of Commons.
He said his opinion was backed by all of Quebec, including the Liberal provincial government, which opposes Quebec independence.
Canada’s 10 provinces and three northern territories each have their own regulatory regimes.
All but Ontario -- which handles 80 percent of all securities transactions via the Ontario Securities Commission -- have endorsed a “passport” system whereby a company obtaining approval in one jurisdiction would be recognized in another.
On March 17, for example, a rule will go into effect allowing a company to clear a prospectus through its home regulator and have that clearance apply automatically to all provinces and territories, except Ontario.
Flaherty said the passport system was an advance, but did not go far enough.
“Canada still has 13 securities regulators, 13 sets of laws, however harmonized, and 13 sets of fees,” he said.
It makes national co-ordination of enforcement more difficult and it still requires agreement from 13 regulators to change the rules, he added.
Last month Flaherty appointed a panel of experts to advise him on how to create a national regulator. The 11-member panel, headed by former trade minister Tom Hockin, will report back by the end of 2008.
The International Monetary Fund, the Bank of Canada and the Canadian Chamber of Commerce are among those that have advocated a single regulator.