It's a skirmish that's being cast as Quebec Inc. versus Toronto Inc.
A coalition led by the Quebec government is hoping its campaign to put a stop to Federal Finance Minister Jim Flaherty's plan for a national securities regulator will turn into a groundswell of support from Quebec companies and business leaders.
Premier Jean Charest has been fulminating against what he calls a project that will favour Toronto's Bay Street, as jobs and economic activity related to securities regulation migrate out of the province, and he wants to move the debate from the narrower political sphere into the broader business and public communities.
And coalition members are taking heart in comments made Wednesday by Jeffrey Orr, the head of Power Financial Corp., whose holdings include Great-West Lifeco Inc. and Investors Group.
"We would note that the current system [of 13 provincial and territorial regulators]is functioning and we also note there is great concern in various parts of Canada on moving to a central regulator and until those concerns are addressed it's going to be difficult to move to a common securities regulator," Mr. Orr said after the company's annual meeting.
Mr. Orr stressed that Power Financial - part of the Desmarais family empire - supports the idea of a national securities watchdog, but only when "a structure is put forward that can accommodate all the requirements and needs of all the provinces and this part hasn't been done."
"We are pleased that Power Financial Corp. has taken this position," said Sylvain Théberge, spokesman for Quebec's financial regulator, the Autorité des marchés financiers (AMF), and a key coalition member.
Mr. Théberge said he anticipates more companies adding their names to the list of those backing the effort to stop Mr. Flaherty's project.
Among firms that have so far joined are media giant Quebecor Inc., drugstore operator Jean Coutu Inc. and papermaker Cascades Inc.
"The goal here is to shift the debate from the political arena to the public arena. We want companies, lawyers, investors, consumers to grab hold of the debate."
Above all, the fight is an appeal to reason and a recognition that the existing system of harmonized regulation among the provinces and territories works largely because it is decentralized, he said.
Mr. Flaherty's proposal smacks more of a centralizing "political project that favours Toronto," he said.
Quebec Finance Minister Raymond Bachand said Monday that Ottawa's national-watchdog plan is tailor-made for Toronto, where the head offices of the Big Five banks - owners of the major brokerage firms - are located.
Michel Nadeau, the head of Quebec's Institute for Governance of Private and Public Organizations and a member of the coalition, put it more bluntly: "Toronto Inc. would prefer to have all the lawyer and all the accountant jobs in Toronto."
Mr. Théberge said some companies are reluctant to come out publicly against the concept of a national regulator, even though they agree that they existing system works fine.