New Financial Services Regulatory Authority in Ontario
Last fall, the Ontario government announced that it would proceed with plans to establish the new Financial Services Regulatory Authority (FSRA) of Ontario.
Why a new regulator and what happens to the current regulators?
The aim of the FSRA is to be an independent, flexible, and innovative financial services and pension regulator, tasked with modernizing current regulators. Its objective will be to strengthen consumer, investor, and pension plan beneficiary protection, while reducing regulatory burdens on Ontario businesses.
Bill 70, Building Ontario Up for Everyone Act (Budget Measures), 2016, requires the current regulators—the Financial Services Commission of Ontario (FSCO), the Financial Services Tribunal (FST), and the Deposit Insurance Corporation of Ontario (DICO)—to provide information to the FSRA "for the purpose of preparing for the Authority to carry out the regulatory function."
The draft legislation provides that FSRA will have the authority to regulate sectors named in the Financial Services Commission of Ontario Act, 1997, including: pension plans, pooled registered pension plans, co-operative corporations, credit unions, insurance companies, loan and trust corporations, and mortgage brokers and agents.
What’s the timeline?
The first Board of Directors for the FSRA has been appointed and will supervise the management of FSRA's affairs, including the development of a detailed transition plan and appointment of the Chief Executive Officer.
The government will continue to consult with stakeholders and review recommendations from the expert advisory panel that recommended the creation of FSRA. This work will inform the development of FSRA's mandate and governance structure. The government expects to introduce legislative amendments related to this by the end of 2017.
What does this mean to you?
It’s too early to tell exactly what this will mean for plan sponsors in Ontario; however, we will be paying close attention to these developments and providing updates as they become available.