The Proposed Amendments include a net increase in the BCSC’s annual fee-based revenue, which is intended to return the BCSC to a balanced budget in 2028. 

However, the Proposed Amendments have not been supported by any data or analysis on the BCSC’s financial position.

See full CFFiM analysis here.

Between 2015 and 2026, the BCSC’s fee-based revenue increased from roughly $43 million to over $90 million. During that time, the BCSC’s unrestricted reserves grew from approximately $26 million to over

$86 million. This includes an annual surplus of over $5 million in 2026. The fact that the BCSC is seeking a fee increase in these circumstances suggests that the BCSC’s regulatory costs are outpacing the size and performance of BC’s securities markets as reflected in corporate filings, registrations, and distributions.

Although the BCSC expects to incur deficits in the coming years, the Notice does not include any discussion on those projections or explain why they necessitate a fee increase. To the extent the BCSC needs to balance its budget, the BCSC has not provided any data or analysis to support the specific fee adjustments being proposed. Moreover, there is no indication that the BCSC has undertaken a meaningful review of how it could increase its operational and administrative efficiencies to address its financial challenges.

The BCSC is dependent on fees that it collects from market participants but the process by which the BCSC adjusts its fee structure suffers from a lack of accountability. The BCSC should submit to an external audit of its fees and cost-recovery model to promote operational efficiency and reduce costs for market participants, with the aim of stimulating growth, competition, and capital formation.

Any amendments to the BCSC’s fee structure must be considered within the wider context of Canada’s regulatory environment, including the cumulative fees that are charged by Canada’s various regulatory authorities. The BCSC should engage with members of the Canadian Securities Administrators (“CSA”) and the Canadian Investment Regulatory Organization (“CIRO”) on this important issue.