Risk Management and Crisis Response Blog

Cooperative Capital Markets Regulator Releases Proposed Transition Approach

Mar 18, 2016 2 MIN READ
Robert Carson

Partner, Disputes, Toronto

Lawrence E. Ritchie

Partner, Disputes, Toronto

The CCMR has recently posted a summary of its proposed “Transition Approach”. This approach lays out the following transitional principles, with the stated goal being to “minimize the impact of transition on market participants and their businesses”:

  • decisions of a predecessor regulator would become decisions of the Capital Markets Regulatory Authority (CMRA) and those decisions would have effect in all participating jurisdictions (for example: registration decisions, prospectus receipts, and exemptive relief decisions);
  • most orders of a predecessor regulator would be deemed to be orders of the CMRA and would have effect in all participating jurisdictions (for example: recognition orders, designation orders). An exception is blanket orders, which would, where appropriate, be carried forward as CMRA Local Regulations;
  • the Authority and Chief Regulator would be able to vary or revoke decisions of predecessor regulators to resolve any discrepancies between decisions made in different participating jurisdictions;
  • the Authority and Chief Regulator would be able to take up any applications in progress or forms submitted at the launch of the CCMR System;
  • obligations to a predecessor regulator would continue as obligations to the CMRA;
  • administrative enforcement orders would be deemed to be orders of the Tribunal in the participating jurisdiction where the order was made; and
  • hearings, reviews and appeals in progress or requested prior to the launch of the CCMR System would continue to be heard by the panel or decision maker who was seized of the matter, or where no panel or decision maker is yet seized, would be heard by the CMRA or the Tribunal, as appropriate.

The transition summary includes a chart setting out the proposed approach in various situations that may arise when the new regime “goes live”. For instance, compliance reviews and investigations commenced prior to the launch would continue, and investigation orders would be deemed to be orders as if they were granted under the new legislation.

These approaches to the transition to the new CCMR System are of great interest to many market participants (and particularly their counsel). Nonetheless, it is worth noting that as of the date of this post, a number of anticipated pronouncements remain outstanding. For example, the public has yet to see the revised draft of the proposed Federal Capital Markets Stability Act, or any proposed initial regulations to be made under it. As well, notwithstanding the announced appointment of the Nominating Committee in April 2015, and the appointment of Bill Black as the first Board Chair on July 24, 2015, the market still awaits receipt of the names of the remaining initial Board Members.

We will continue to watch and write on developments on this initiative, especially as we get closer to the implementation of the new system.