After nearly 20 years outside the system, Ontario committed to joining the CSA passport system. The passport system allows firms to access capital markets across most of Canada by working primarily with a single principal regulator, reducing duplicate reviews and regulatory processes.
For jurisdictions already using the passport system, Ontario’s participation would help make the framework more complete and reduce the complications that come from having Canada’s largest capital market partly outside the system. In practice, however, the changes may be less dramatic than they appear because Ontario already works closely with other securities regulators: other regulators accept certain Ontario Securities Commission (OSC) decisions, and the OSC accepts certain decisions by other regulators while retaining discretion to make its own decisions.
The real test is what happens next. For investors, the key question is whether a more complete system will deliver stronger and more consistent protection, regardless of where they live or which regulator does the review. The passport system relies on regulators applying the same rules consistently and making comparable decisions across the country.
As investors may increasingly be affected by the decisions of a regulator outside their home province or territory, confidence in the system will depend on regulators applying the rules consistently. For FAIR Canada, the objective is simple – a more complete passport system should strengthen investor protection, not make it easier for decisions that fall short to be adopted elsewhere.