What are the Canadian Securities Administrators?

The Canadian Securities Administrators is a network panel that brings together the varying regulatory requirements across each of Canada’s 10 provinces and 3 territories.

Since becoming a formal national body in 2003, its committees strive to streamline local policies and provide beneficial information to investors. 

A history of the Canadian Securities Administrators

In Canada, each of the provinces and territories has its own capital market and version of regulatory requirements. This has been a long-standing way of working since the local governments and councils have more autonomy in Canada than in other countries with states such as the USA. 

For example, the British Columbia Securities Commission and the Ontario Securities Commission vary in the standards and information they provide. But this has caused confusion and discrepancies for companies striving to raise capital, and for investors, who receive contrasting information depending on their location. Moreover, the rise in popularity of ESG investing requires totally new disclosure standards, for example.

Therefore, the Canadian Securities Administrators (CSA) exists in order to gel and blend each local provincial regulatory requirement as the overall Canadian Securities Regulator. By streamlining how financial institutions need to comply, it can be compared to the US’s SEC or FINRA committees. 

The CSA works by creating a “passport system” for market participants, by streamlining each case through its local authority. Where these regional committees hold better trust and relationships with local investors and companies, this system improves efficacy and compliance with the regulation.

Key features of the CSA

As the national Canadian Securities Administrator, the CSA has three primary purposes as part of its mission: 

1. Reduce market risk in Canadian markets (as issuers of securities regulation)
2. Protect investors from unfair practices (by regular review of investment fund regulations)
3. Facilitate fair capital markets (through their work with local securities regulators)

In order to achieve this, there are several different committees, such as the Standing and Projects Committee, and the Policy Co-ordination Committee. Each taking on different roles, their overall aim is to coordinate new nationwide policies based on research and discussion with local regulators. 

Furthermore, Canadian Securities Administrators create and distribute new prospective and disclosure documentation for financial institutions. These committees are also responsible for investigating unfair or suspicious practices, as well their punishments. 

Finally, the CSA aims to strengthen Canadian capital markets and national instruments. Their National Registration Database exists as a search library for investors and helps to make Canada a more attractive place to invest. The CSA creates protection around the personal information of investors in a bid to increase security and trust in Canada’s economic markets. 

Who must comply?

The Canadian Securities Administrators creates quarterly publications and reforms, specifically for financial institutions and securities dealers.

They also oversee all investors in order to maintain best practices and ensure the market is a fair place. The organization’s website contains industry resources and tools around securities law, in order to help investors and public companies comply.

For those who do not comply, the CSA has shown that it does enforce its policies. Since its conception, the organization has frozen the assets and ordered ‘cease trading’ in over 100 cases. Moreover, more than 60 individuals have been banned from investing, with some cases leading to malpractice criminal suits and imprisonment. 

To better understand your regulatory requirements, speak to our team.