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w w w . C A N A D I A N L a w y e r m a g . c o m N O V E M B E R / D E C E M B E R 2 0 1 6 31 The lack of clarity around applicable federal regulations can be damaging espe- cially since Canadian business, particular- ly financial institutions, are fairly cautious, says Molino. "Regulatory uncertainty can be really frightening to a lot of financial institutions and a lot of other businesses. We have come to the conclusion that it would be preferable to have a well- articulated legal framework that applied to fintechs generally. I think it would make it easier to do business in the country." That is unlikely to happen any time soon as regulators are clearly waiting to see the effect fintech has before introduc- ing new rules or revising old ones just as the U.S. Department of the Treasury did last year when it submitted a public request for information to understand the impact of online marketplace lending on small business, consumers and the broader economy. Quebec's security regu- lator has two committees now examining the sector while the federal Competition Bureau launched a study earlier this year to assess the impact fintechs have on the competitive landscape, examine barriers to entry and gauge the state of current regulatory frameworks. Other regulators and policymakers are regularly having informal discussions with startups to try to understand the kind of innovations now taking place in the startup community, to find out what they can do to create a better environment for innovation and to ensure that the upstarts have proper checks and balances in place to protect consumers and business, says Teja. "Our regulators and policymakers are trying to understand the risk points that may exist in new and emerging mod- els. It's a function of technology evolving so quickly and business models emerging that are changing the way people are con- suming financial products." Some legal observers suggest that Canadian regulatory authorities would do well to follow in the footsteps of the U.K., Singapore and Australia and create a so-called regulatory sandbox, or legal bubble, that would effectively temporar- ily suspend, or relax, certain financial transactions or business lines in order to bolster innovation — a tack that the OSC decided to emulate. The OSC Launchpad will be staffed by a dedicated team that will work directly with fintech companies to help them navigate Ontario's securities laws. "There are a lot of fintech companies in a variety of spaces and this is a complex regulatory regime so enabling startups to play in that sandbox to test things and see if they will be successful without hav- ing to invest in large compliance regimes would be very helpful," says Skakun. But Badour, like others, doubts that a pan- Canadian regulatory sandbox is feasible. The jurisdictional split in powers between the federal government and provincial governments may make it too complex to execute. But the status quo is also dangerous, because while fintech innovations promise to solve current problems, they could also create new ones, says the senior deputy governor of the Bank of Canada. "Because it is early days, no one knows for sure what fintech developments will ultimately mean for business models or for the financial system more generally," says Wilkins. "But we are all trying to figure it out." Because business issues are legal issues. So if you want to get ahead in business, get the degree that gets you there faster. ONE YEAR – PART - TIME – NO THESIS FOR L AWYERS AND NON - LAWYERS law.utoronto.ca/ExecutiveLLM GPLLM Global Professional Master of Laws [Get a Master of Laws] Untitled-1 1 2015-02-25 8:38 AM

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