Investment companies with bright ideas will soon be able to test their theories in a new lab environment with the Ontario Securities Commission (OSC).
The OSC’s Innovation Office has announced the launch of a new program to allow for experimentation, known as TestLab. The regulator said the program will allow companies, such as fintechs and existing industry players, to test out novel products, services and solutions in “real-world conditions.”
“This can include testing in a live environment with access to customers, data, and capital under standardized testing parameters,” the OSC said, noting that the regulator will work with participants to “develop their testing plan, help remove regulatory obstacles, and monitor progress along the way.”
These tests might involve providing exemptions from certain regulatory requirements to allow firms to run trials with investors under controlled conditions.
“For capital market participants, whether individual investors or the firms that serve them, TestLab can help accelerate access for early adopters and reduce time to the overall market,” the OSC said.
At the same time, the project will inform regulatory policy — and could lead to reforms.
“We anticipate that some tests will target regulatory innovation itself, allowing the OSC to explore new technologies to enhance our regulatory environment and supervision of the capital markets,” it said, adding that the initial tests are already being designed.
“We will be announcing further details about TestLab in the coming weeks, including our first problem statement and details about how to apply to participate in our first cohort,” the OSC said.