Canadian securities regulators in Alberta, Nova Scotia, Manitoba, British Columbia, New Brunswick and Saskatchewan have invited the industry to participate in a study looking into greater portability of client data in the investment market, through discussions and testing.
Consultation and potential testing will be conducted under a new Canadian Securities Administrators (CSA) program, called the ‘CSA Collaboratory’, which has been established as a “mechanism” to explore the market impact and regulatory implications of new technologies and business models.
Stan Magidson, CSA chair, and chair and chief executive officer of the Alberta Securities Commission, observed that the acceleration of technological change is having “profound effects” on the investment market.
Magidson said: “As regulators, we need to anticipate those changes. The CSA Collaboratory will allow us to engage more intensively with both established market participants and innovative businesses pioneering new tools and business practices, and hopefully assess those innovations under real-world conditions.”
The CSA Collaboratory’s first project will focus on data portability and the process of collecting client information digitally.
Among the issues it will consider are the demand for and benefits of data portability solutions, as well as the use of data portability in mitigating investor risk, and privacy and security concerns arising from increasing data portability.
Also under scrutiny will be the technological standards and innovations related to data portability, and the possible regulatory barriers affecting development of data portability solutions.
Should the data portability discussions move to testing technological tools or business strategies, then eligible businesses would be allowed to simultaneously pilot those innovations in a “controlled space” and within defined timeframes.
Companies will then receive direct feedback from CSA staff throughout the testing process.
“Governments around the world are exploring how to give users greater control over their own data, while also providing safeguards for data privacy,” said Brenda Leong, chair and chief executive officer of the BC Securities Commission which, along with the Alberta Securities Commission, is championing the data portability project.
“The CSA wants to better understand how this trend – and the corresponding technological solutions – mesh with current securities regulations, and what changes might be necessary to facilitate those innovations.”
The CSA is currently inviting comments on the consultation stage of the project, until May 19.
However, it considers data portability the first of several topics to be explored via the CSA Collaboratory’s cohort-based approach, with each test theme to be led by one or more Canadian securities regulators.
