Single Regulator Administering Single Law Will Bring Gains in Enforcement, Policy-Making, Efficiency, International Standing and Accountability

Vancouver, British Columbia, December 17, 2003 – The Wise Persons’ Committee to Review the Structure of Securities Regulation in Canada today called for the creation of a single regulator built on a joint federal-provincial model.

The Committee’s report, titled “It’s Time,” is a response to a high level of frustration among market participants with the inadequate enforcement, undue complexity, excessive cost and weak international profile of Canada’s current regulatory system of 13 provincial and territorial regulators.

“There was a time when Canada was well served by a provincially-based system of securities regulation, but those days are gone,” said Michael Phelps, Committee Chair. “It’s time for Canada to have a single regulator administering a single code nationwide.

“With less than 3% of the global capital market and a population roughly equal to the state of California, Canada can no longer afford to be the world’s only major industrialized country without a national regulator.

“This is not an abstract issue. It is about staying competitive with the rest of the world. It is about implementing the system that best protects investors, that best provides access to capital for companies, and that best enables capital markets to contribute effectively to Canada’s long-term economic growth.”

The Recommended Model
The recommended model ensures strong participation by the provinces. The Canadian Securities Commission (CSC) would consist of nine full-time, regionally representative Commissioners appointed by the Minister of Finance. Nominees would be proposed by a 13-person Nominating Committee with 10 members designated by the provinces. A Securities Policy Ministerial Committee consisting of the provincial ministers responsible for securities regulation and the Minister of Finance would provide a framework for provincial input to securities policy and the system's administration.

The Commission would administer a comprehensive code of capital markets regulation to be enacted by the Federal Government. This legislation should take into account the Uniform Securities Legislation Project that has been undertaken by the Canadian Securities Administrators and other provincial legislative reform proposals.

The Committee's single regulator proposal would significantly strengthen enforcement, facilitate better policy innovation and development, and enhance Canada’s brand of securities regulation internationally. Moreover, it would establish clear lines of accountability, ensure responsiveness to regional needs, provide for uniform investor protection across Canada and facilitate the reallocation of substantial funds towards better enforcement and other pressing regulatory issues.

A Call for Change
“It was made abundantly clear to the Committee in 92 written submissions and through nine days of public consultations with issuers, investors and other market participants across the country that there is a new and unprecedented demand for change. Canadians want – and need – a simpler, more efficient regulatory system geared to the distinctive characteristics of the Canadian economy, including a significant component of emerging companies.

“We gave serious consideration to the proposed passport system throughout our deliberations. The passport represents an incremental improvement over the status quo, but as a number of market participants pointed out, it falls far short of the kind of system Canada needs to be successful.

“We believe there are no meaningful impediments, constitutional or otherwise, to the prompt implementation of our recommended model,” said Mr. Phelps. “We urge capital market participants to continue speaking out on this issue. That is the only way to ensure reform. Likewise, we urge the federal and provincial governments to work together to promptly implement the Committee’s recommended model. This must not be about federal-provincial turf squabbles. It has to be about serving the best interests of Canada’s capital markets and the Canadian economy.”

About the Wise Persons’ Committee
Established by former Minister of Finance John Manley in March 2003, the mandate of the WPC was to undertake an independent objective review of the current securities regulatory framework and identify an appropriate model for securities regulation in Canada.

The Committee’s recommendation is based on extensive input from market participants, independent research studies, and the Committee members’ collective experience and judgment. Many of the independent research studies conducted for the committee represent the first independent examination of this complex and important subject. Copies of the Committee’s report, independent research papers, submissions from market participants and related documents are available on the Committee’s website at www.wise-averties.ca.

The committee members are:

  • Michael Phelps, Chair, Vancouver, Chairman of Dornoch Capital Inc., a private investment company, and former Chairman and Chief Executive Officer of Westcoast Energy Inc.;

  • Harold MacKay, vice-chair, Regina, Senior partner in the Saskatchewan-based law firm of MacPherson Leslie & Tyerman LLP and former Chair of the Task Force on the Future of the Canadian Financial Services Sector;

  • Thomas Allen, Toronto, Senior Partner, Ogilvy Renault, Chairman of the Accounting Standards Oversight Council of Canada, and a member of the Advisory Board of the Office of the Superintendent of Financial Institutions;

  • Pierre Brunet, Montreal, Chair, Canadian Institute of Chartered Accountants and former President and Chief Executive Officer of National Bank Financial;

  • Wendy Dobson, Toronto, Director, Institute for International Business, Professor at the Rotman School of Management, University of Toronto, Vice Chair Canadian Public Accountability Board and former Associate Deputy Minister of Finance, Ottawa;

  • Edwin C. Harris, Halifax, Counsel with the Halifax office of the law firm Patterson Palmer; and

  • Michael Tims, Calgary, Chairman, Peters & Co. Limited, a Calgary-based investment firm engaged in securities brokerage, corporate finance and mergers and acquisitions.

The Wise Persons’ Committee will hold a news conference on December 17, 2003 at 9 a.m. Pacific Time (Noon Eastern Time) regarding its report to the federal Minister of Finance. The public is invited to listen to the news conference in real time or by replay on the internet. The webcast can be accessed through the Wise Persons’ Committee web site at http://www.wise-averties.ca/ Replays will be available in streaming audio shortly after the conclusion of the news conference.

For further information:
Elizabeth J. Harrison
WPC Secretariat Executive Director
Farris Vaughan Wills & Murphy