Both David Brown, chair of the Ontario Securities Commission, and Barbara Stymiest, CEO of TSX Group Inc., spoke in favour a single national regulator today at Canadian Investor Relations Institute luncheon in Toronto.

Brown and Stymiest agreed that representing Canada’s capital market to the world requires a national regulator. “It is not just a matter of needing national coordination. What we need is a national perspective,” Brown argued.

Stymiest noted that foreign governments, regulators, investors, and issuers see Canada as a single securities market, “That’s why foreign governments and regulators get a surprise when they come to Canada with the hope of negotiating a bilateral agreement between equals and they are told instead to go from province to province to do it.”

Stymiest used Nasdaq to illustrate the benefits of a single regulator. “It wants access to Canadian investors, just like we want access to U.S. investors to trade on TSX. It’s an ideal situation for a trade negotiation — we’ll give you access if you give us access. But the provinces don’t have any authority to negotiate trade deals. So they give access without getting any in return.”

Stymiest noted that Nasdaq has ended up with one sort of deal in Quebec, a different one in B.C., and possibly a third in Ontario.

Brown also suggested that a national regulator is essential to effective, efficient regulation. “Over the past couple of years, we have seen how easy it is to lose public confidence. And we have seen that borders offer little or no protection from the threat of eroding confidence,” he said. ”

Stymiest said that the provinces should work with the federal government to create a single regulator, as the Wise Persons’ Committee has recommended. “To my mind, it is in the self-interest of the provinces to take the initiative and join with the federal government to create a single commission,” she said.

She warned that the provinces can not be trusted to initiate reform themselves. “The provinces, for clear and obvious political reasons, find it difficult to deal with matters, like securities regulation, that need to be decided at the national level. That is because, in straight political accounting, they can gain no credit for acting in ways that benefit Canadians who live in other provinces.”

“I would argue, in fact, that it is the possibility of the federal government acting in the area of securities regulation that has given such impetus to the positive changes the provinces have made in the last two years. They have felt compelled to make the case that a different set of changes can suffice. They won’t suffice,” she said.