An assortment of media reports tell us this weekend’s Grey Cup will be the scene of some off-field maneuvering in the securities regulation game.
Alberta Premier Ed Stelmach is reportedly planning to broach the subject of a western securities commission while hosting his opposite number from Saskatchewan, Brad Wall. The rumours also suggest that Manitoba might be included — let’s watch for Premier Greg Selinger in the same box as Wall and Stelmach.
The logic, we’re told, is that since the two western provinces both rely on resource extraction, they should have common ground in securities regulation.
Both provinces are home to so many small companies, the cornerstones of the exploration industry. These small companies, they say, require a different standard of regulation from large cap companies.
The argument is put forth that western securities commissions are more familiar with these small cap companies, and that expertise makes a Western Securities Commission preferable to a national one.
Fair enough. Perhaps small caps should not be regulated by the same commission that oversees Potash Corp., Suncor or EnCana, since these companies are so vastly different from the small caps.
Perhaps what is needed, then, is a small cap securities commission and a large cap securities commission, each on a national scale. While some might consider such duplication patently wasteful and inefficient, those same folk usually consider 13 provincial and territorial commissions to be a model of efficiency.
A better explanation for the creation of a Western Securities Commission would be that it would create a beast with a similar heft as the Ontario Securities Commission and the Autorité des marchés financiers (note that Jean Charest has been left out of the rumoured Grey Cup meeting).
By creating a Pan-Prairies Securities Commission, spanning from the Ontario border to that of British Columbia, the western regulator might feel it was finally in a strong enough negotiating position to come to the table and discuss a nation-wide regulator.
The larger, stronger Western Commission could better press its case in creating regulations that work for that region. If its creation moves the ball forward on nation-wide regulation, then it should be welcomed.
(11/26/10)