TORONTO (Reuters) - Alberta is working to build support among fellow Canadian provinces for a proposed alternative to a national securities regulator, establishment of which the resource-rich province has long opposed, its finance minister said on Thursday.
In September, the federal government launched a unified regulatory regime intended to replace the patchwork of provincial securities regulation that now exists across the country. So far only Ontario and British Columbia have signed on to the new regime, which provinces are not required to join.
Alberta Finance Minister Doug Horner’s proposal would establish a national enforcement agency and adjudicator tribunal, both headquartered in Toronto, Ontario’s capital and the hub of Canada’s capital markets. But the plan would leave day-to-day regulation to individual provinces.
Ottawa has tried for decades to persuade Canada’s 10 provinces and three territories to create a national regulator similar to the U.S. Securities and Exchange Commission. The country has been criticized by the International Monetary Fund and others for being the only advanced economy without a national capital markets regulator.
“We think it solves the issue the federal minister put forward. We think that it opens the door for Ontario to join into the national system,” Horner said, referring to the so-called passport system in which all the provinces but Ontario have agreed to recognize each other’s rulings.
Alberta’s position underscores the challenge the federal government still faces in getting consensus on the issue.
Horner said that over the past month he has held preliminary talks on Alberta’s proposal with his counterparts in Ontario and British Columbia.
Alberta accounts for 25 percent of Canada’s total market capitalization due in large part to the province’s stable of energy and mining companies, compared with Ontario’s 41 percent.
The issue of who should regulate companies incorporated in different parts of the country has gone all the way to the Supreme Court, which ruled in 2011 that it was unconstitutional for Ottawa to impose a national regulator on the provinces and territories.
As a result, the federal government dropped its unilateral approach in favor of the cooperative format with willing provinces.
Horner said he was worried that Ottawa would continue to move ahead with that format, while ignoring concerns raised by Alberta and Quebec, which also fiercely resists the federal push.
Horner said he was also prodding the federal government to provide more clarity to rules on foreign takeovers in Alberta’s oil sands, development of which he estimates will require C$350 billion ($318 billion) in investment capital over the next 25 years.
Editing by Frank McGurty; and Peter Galloway