The Ontario Security Commission (OSC) is a powerful agency in Canada. Since we as a real estate firm issue securities for our syndicated residential properties we have to follow security laws, specifically NI 45-106 and NI 31-103 . We do not yet follow OSC’s or the proposed national security regulator’s overreaching rules, as we are an Alberta based firm and do not raise money from Ontario – yet. As such we follow primarily the ASC (Alberta Security Commission) regulations. Alberta and a few other provinces have – for good reason – not yet signed on to the proposed national security regulator framework, the CCMRA (Cooperative Capital Market Regulatory Authority) that may result in the PCMA (Provincial Capital Markets Act) in 2015. Some suggested changes to the private equity, also referred to as the Exempt Market space we operate in were heavily opposed by many in the summer of 2014. A list of the over 360 submitted letters is here, including many from our investors, Scotty Grubb’s or Thomas Beyer’s. Based on this feedback the OSC stopped or amended many of the proposals, such as the proposed $30,000 annual cap, but may re-introduce those in amended formats in the spring 2015 when we expect new changes, including a relaxation of the Offering Memorandum restriction for Ontario investors.
Recently the OSC took on Jack Mintz, the Chair of Public Policy at the University of Calgary as one of the many letter writers and open critics of the far reaching and industry stifling initiatives of the OSC, such as this CCMRA proposal. Oops. It backfired as Jack Mintz writes well and is widely read and respected for a fair opinion. Read the OSC letter and this op-ed here, please: http://business.financialpost.com/2014/12/09/terence-corcoran-oscs-attack-on-academic-jack-mintz-unprecedented/
A series of articles analyzing the recently proposed changes for a national security regulator are below. A national regulator, as opposed to 10+ provincial ones (yes, PEI has one, too) is a decent idea in principle, but far too many details are missing as you can see from the headline alone: “Be afraid, be very afraid” or “red tape” or “where are the efficiencies?”
National Regulator 1: The Grand Market Regulator: Be afraid, very afraid
National Regulator 2: A Category 5 blizzard of red tape is headed for Canada’s market players
National Regulator 3: Where are the efficiencies?
National Regulator 4: The regulatory Leviathan
Costs to comply with security legislation have risen substantially the last few years, and guess who pays these costs through lower returns ? That is right, you, the investor.
As such this op-ed suggests to chuck the newly proposed CCMRA regulations led by the OSC as does this one here under the heading “take back this law” ! Powerful stuff every concerned investor should read !
We all acknowledge that meaningful regulation is required in the capital markets. It appears that the newly proposed framework for the national security regulator is going too far, reducing access to capital for growing firms like ours, risking job growth, reducing investor returns, allowing excessive authoritative overreach and threatening economic prosperity under the disguise of “investor protection” !
President & Founder, Prestigious Properties Group
Don’t Wait to Invest in Real Estate – Invest in Real Estate and Wait (TM) !