A Bay Street sign is seen in the financial district of Toronto on June 2, 2014.Mark Blinch/The Globe and Mail
To all the people putting in countless hours to create a pan-Canadian securities regulator: You've made great strides, don't you dare look back now.
Amid widespread political wrangling and never-ending delays, it has been easy to start worrying the dream is dying. Ontario and British Columbia roared out of the gates two summers ago with plans to create a co-operative regulator, but since then, more and more hurdles have popped up.
The new regulator, whose powers will be split among the participating provinces and Ottawa, was supposed to be up and running by Canada Day this year.
The reality: We still do not have a final draft of the proposed legislation, let alone someone to run it.
The dream started to seem even more daunting earlier this month after Quebec announced plans to challenge the entire concept in court. Amid worries the new regulator would threaten its provincial independence, Quebec will argue the new system would violate Canada's constitutional division of powers, adding that it flies in the face of a 2011 Supreme Court of Canada ruling.
With so many setbacks, there have been whispers that we should not get our hopes up. We've talked about a national regulator for decades, but it has never come close to becoming reality.
Despite the serious push, the turtle-like pace of Canadian courts and regulatory bodies have taught us to think long-term.
For example, just last week, creditors approved a settlement with Castor Holdings Ltd. to resolve negligence claims. The case took 23 years.
Against that backdrop, the news that Bill Black has been named chair of the board of directors that will oversee the new regulator is actually rather important. Messaging matters, and the latest development shows that everyone remains committed.
It also creates a sense of inevitability, with the process now elevated from a political game in which interested parties fight for control to a business model where an independent board is held accountable for what gets done.
People close to the file say it is hard to express to outsiders how political the process been until now. Just one example: It can take weeks, months even, to figure out the process for uploading something to the new regulators' website. At the moment, each province has its own steps for posting their notices.
It also helps that Mr. Black, who used to run Maritime Life and has served on the boards of the Bank of Canada and Dalhousie University, is no regulator or bureaucrat. He is a respected name from a regulated industry, so he has ample experience with watchdogs and, maybe most importantly, he is not from Ontario. Boxes ticked. Now we can all move forward.
Yes, Alberta and Quebec have yet to sign on, and no one knows if they ever will. But some common ground is emerging as Alberta starts showing some willingness to work with the new co-operative. The province recently announced it will automatically treat enforcement issues from all other jurisdictions as its own. While that is not a full embrace of the new regulator, it is not nasty opposition to it, either.
Quebec, of course, is still playing hardball. But as big an obstacle as its court case may seem, the provinces were actually expecting it.
Days after B.C. and Ontario announced their plans in 2013, officials from the two provinces met with Quebec's Finance Minister. Right then and there, Quebec said it would likely have to sue, because that is what Quebec does.
As jarring as the court case may seem to the general public, the co-operative's creators expected it all along. Call it par for the course.
What the co-operative's backers must do now is continue communicating their progress. Keeping outsiders abreast of new developments is crucial to getting something done. Make it seem like it would take Napoleon's army to stop this thing.
Talking to people familiar with the file, it appears enough things are in the pipeline to create such inertia. A final draft of the legislation is expected in August – the unofficial word is that the partners want the required 120-day comment period to end before Christmas – and the announcement of a full board could come this fall.
Please, for the sake of the country, stick to those timelines. Canada needs this badly. It is time for our regulatory system to grow up.
Tim Kiladze