Regulating Disruption

Mowat Centre | Sunil Johal and Michael Crawford Urban | May 11, 2017

Mowant centre regulating disruption - Regulating DisruptionGoverning in an era of rapid technological change:  In this report, the Mowat Centre examines the relationship between regulation and innovation in rapidly-changing technological industries. Building on this analysis and informed by examples from other jurisdictions, the authors suggest a suite of reforms to Canada’s regulatory frameworks and development processes aimed at enabling them to become more encouraging of innovation.

Executive Summary

Governments across the world are scrambling to respond to the arrival of innovative new digital services such as Uber, Netflix and Airbnb. While these services promise great benefits for Canadians, they also pose novel regulatory challenges to how governments are structured, engage with stakeholders and hire and train their staff.

How should governments regulate global services headquartered in other jurisdictions but available digitally within Canada? How can governments engage and encourage innovators and balance their needs with other stakeholders when government agencies struggle to hire and retain personnel who understand the technical issues involved? How can regulators successfully reconcile the deliberate pace of regulatory processes with the accelerating speed of innovation?

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Identifying solutions to these questions will be a vital step towards securing Canada’s prosperity in the digital age. Other countries have already launched serious efforts aimed at reducing the burden of regulation as well as other measures designed to make their regulatory systems more innovation-friendly. Without renewed attention to this issue, Canada risks being left behind.

This report argues that Canadian governments can and should undertake a serious and sustained effort to bring their regulatory practices and culture out of the industrial age and into the digital age. Canadian governments have the opportunity to significantly boost innovation in several exciting ways, ranging from a greater embrace of design thinking in their regulatory design processes, to the initiation of programs for enhancing technological capacity within government, to the development of new tools to ensure vigorous competition in digital markets. By leveraging these opportunities, governments can make a significant and positive contribution to Canada’s future and ensure Canadians are well-positioned to promote and reap the benefits of innovation.

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NCFA Jan 2018 resize - Regulating DisruptionThe National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with fintech, alternative finance, blockchain, cryptocurrency, crowdfunding and online investing stakeholders globally. NCFA Canada provides education, research, industry stewardship, services, and networking opportunities to thousands of members and subscribers and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: ncfacanada.org

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BC Securities Commission | Release | Jan 27, 2020 Vancouver – The British Columbia Securities Commission (BCSC) is seeking input from interested stakeholders through two new advisory groups. Last week, the BCSC held the first meeting of its Corporate Finance Stakeholder Forum, which will help ensure that the Commission’s regulation of issuers is efficient and effective. The BCSC also announced that it is seeking applications from the financial technology community to join the Fintech Advisory Forum. “We work to keep the investment markets fair and honest, in a cost-effective manner,” said Brenda Leong, the Chair and CEO of the BCSC. “Smart regulation depends on good intelligence, and the best way to get that is by engaging with the people and businesses affected by our rules.” The 25 volunteer members of the Corporate Finance Stakeholder Forum is advising Corporate Finance staff on policy initiatives, investment market trends and other emerging issues affecting reporting and non-reporting issuers, including investment funds. At its first meeting January 22, members discussed the proposal by the Canadian Securities Administrators (CSA) for a “notice equals delivery” system, as well as other proposals for reducing regulatory burden for public companies. See:  NCFA Canada’s response to BCSC Notice 2018/1 ...
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Finextra | Jan 22, 2020 While technology has yet again been a central topic of discussion at this year’s World Economic Forum in Davos, Switzerland, there has also been a determined focus on fintech and how financial inclusion is key to meeting the UN’s Sustainable Development Goals by 2030. In conversation with Finextra, Haus of Fintech founder Misha Rao highlights that the recent formation of the Digital Financing Task Force by the UN Secretary General, as well as the need to ensure the financing of the SDGs - which has a $2.5 trillion annual financing gap - "it is time to actively question how we catalyse the fintech ecosystem globally and build coalitions and strategic partnerships that come up with practical solutions and ensure prosperity is widely shared on a local and an international level." See:  Task Force Analyzes Role of Fintech in Accelerating SDGs Rao continues: "We know that digital finance initiatives could add $3.7 trillion to the GDP of emerging economies and organisations including the United Nations, the World Bank, and the World Economic Forum have invested in fintech, believing that it has the potential to create a better world. "We believe that core areas like the need for ...
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LA Times | Jan 27, 2020 Kobe Bryant, the NBA MVP who had a 20-year career with the Lakers, was killed Sunday when the helicopter he was traveling in crashed and burst into flames in the hills above Calabasas. His daughter Gianna, 13, was also on board and died along with seven others. For live updates and remembrance --> here Inc. | Sonia Thompson | Dec 13, 2018 This is How You Achieve Greatness. 5 Essential Lessons From Kobe Bryant A few months ago, Kobe Bryant released his book, The Mamba Mentality. I've always admired his work ethic that led to his numerous accomplishments, so I was eager to dive into the text. See:  Advancing Competition in a Changing Marketplace During Bryant's famed 20-year basketball career with the Los Angeles Lakers, he racked up five NBA championships, two NBA finals MVP awards, and two Olympic gold medals. He's also the third-highest all-time career regular season scorer for the league. The lessons Bryant laid out in his book are gold for entrepreneurs who want to build a legacy of greatness in their work. Here are five important lessons from Kobe's Mamba Mentality every business leader should adopt. 1. Obsession is not-optional. Jeff Bezos often muses about how customer obsession ...
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WSJ | AnnaMaria Andriotis | Jan 19, 2020 Tech giant plans terminals to let consumers link credit card information to their hands Amazon wants to make your hand your credit card. The tech giant is creating checkout terminals that could be placed in bricks-and-mortar stores and allow shoppers to link their card information to their hands, according to people familiar with the matter. They could then pay for purchases with their palms, without having to pull out a card or phone. The company plans to pitch the terminals to coffee shops, fast-food restaurants and other merchants that do lots of repeat business with their customers, according to some of the people. Amazon declined to comment. Amazon, like other tech companies, is trying to further integrate itself into consumers’ financial lives, leaving banks and card networks on edge. Apple Inc. introduced a credit card last year, and Google is rolling out checking accounts. If the Amazon terminals succeed, they could leapfrog mobile wallets such as Apple Pay while expanding Amazon’s already-extensive access to consumer data. See:  Grab launches first cloud kitchen in Singapore amid GrabFood expansion Amazon’s projects are closely watched both by tech and financial companies, which are increasingly colliding ...
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World Economic Forum | Yuval Harari | Jan 24, 2020 Humanity faces three existential threats this century, warned historian Yuval Harari at Davos 2020. Technology risks dividing the world into wealthy elites and exploited "data colonies," he explained. "If you like the World Cup - you are already a globalist," he said, making the case for better cooperation to tackle the challenges. As we enter the third decade of the twenty-first Century, humanity faces so many issues and questions, that it is really hard to know what to focus on. So I would like to use the next twenty minutes to help us focus of all the different issues we face. Three problems pose existential challenges to our species. These three existential challenges are nuclear war, ecological collapse and technological disruption. We should focus on them. Now nuclear war and ecological collapse are already familiar threats, so let me spend some time explaining the less familiar threat posed by technological disruption. In Davos we hear so much about the enormous promises of technology – and these promises are certainly real. But technology might also disrupt human society and the very meaning of human life in numerous ways, ranging from the ...
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Verdict | Ellen Daniel | Jan 13, 2020 Open banking was first launched in January 2018 and received much attention from the financial community as the potential bringer of fintech disruption. The regulations require UK-regulated banks to share their customers’ financial data (with permission) with third party providers through the use of application programming interfaces (APIs) in order to make it easier for customers to access financial services and for TPPs to develop new products. Today marks open banking’s second anniversary and while it has impacted the financial landscape, prompting incumbent banks to adapt to innovation and opening up new opportunities in terms of consumer experience, some have argued that the regulation is yet to live up to expectations. See:  Open Banking in the UK: what’s happened so far Banks had until March 2019 to establish a “sandbox” environment that third party providers could access and use to test products and until June to make their APIs available to third parties, but many European banks have not adequately met key deadlines, stalling innovation. Although many traditional banks are now adhering to open banking regulations, more could be done to ensure that they also benefit from the new landscape in terms ...
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The New York Times | Ruchir Sharma | Jan 20, 2020 To outsiders, China may seem like a surveillance state. But tech has fueled growth and helped stave off recession. Landing in Shanghai recently, I found myself in the middle of a tech revolution remarkable in its sweep. The passport scanner automatically addresses visitors in their native tongues. Digital payment apps have replaced cash. Outsiders trying to use paper money get blank stares from store clerks. Nearby in the city of Hangzhou a prototype hotel called FlyZoo uses facial recognition to open doors, no keys required. Robots mix cocktails and provide room service. Farther south in Shenzhen, we flew the same drones that are already making e-commerce deliveries in rural China. Downtown traffic flowed smoothly, guided by synced stoplights and restrained by police cameras. Outside China, these technologies are seen as harbingers of an “automated authoritarianism,” using video cameras and facial recognition systems to thwart lawbreakers and a “citizen score” to rank citizens for political reliability. An advanced version has been deployed to counter unrest among Muslim Uighurs in the inland region of Xinjiang. But in China as a whole, surveys show that trust in technology is high, concern about ...
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TechCrunch | Danny Crichton | Jan 17, 2020 I talked yesterday about how VCs are just tired these days. Too many deals, too little time per deal, and constant hyper-competition with other VCs for the same equity. One founder friend of mine noted to me last night that he has already received inbound requests from more than 90 investors over the past year about his next round — and he’s not even (presumably) fundraising. “I may have missed a few,” he deadpans — and really, how could one not? All that frenetic activity, though, leads us to the paradox at the heart of 2020 venture capital: It’s the largest funds that are writing the earliest, smallest checks. That’s a paradox because big funds need big rounds to invest in. A billion-dollar fund can’t write 800 $1 million seed checks with dollars left over for management fees (well, they could, but that would be obnoxious and impossible to track). Instead, the usual pattern is that as a firm’s fund size grows, its managing partners increasingly move to later-stage rounds to be able to efficiently deploy that capital. So the $200 million fund that used to write $8 million Series As transforms ...
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NCFA and TFI | January 23, 2020 Strengthening Canada's fintech and financial reach through collaboration, competition and networking at FFCON20 TORONTO, ON / ACCESSWIRE / January 23, 2020 / The National Crowdfunding & Fintech Association of Canada (NCFA) and Toronto Finance International (TFI) announced today a collaborative partnership and the joint launch of the 2020 Fintech and Financing Conference and Expo (FFCON20) to be held in downtown Toronto on March 23-24, 2020. The theme for the 6th annual FFCON is RISE, reflecting the joint efforts of the two associations, NCFA and TFI, to build and increase the success and sustainability of Canada's fintech and financial sector. With finance and fintech touching virtually every business and entity of people's lives, FFCON draws national interest and global participation from high-growth startups and leading industry experts across a variety of disciplines and backgrounds. You will find fintech entrepreneurs from across all fintech sectors including digital banking, peer to peer finance, AI, capital markets, wealth management, payments, crypto and blockchain along with innovative financial institutions, investors, regulators, government and major industry stakeholders, all in one place. FFCON facilitates thought-provoking and relevant discussions, lively debates and personal networking for the cross-pollination of ideas and experiences ...
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Wealthsimple | Press Release | Jan 21, 2020 Wealthsimple Cash offers 2.4% interest rate and lets Canadians save and spend through a mobile app and metal card TORONTO, Jan. 21, 2020 /CNW/ - Wealthsimple has launched its first hybrid saving and spending product: Wealthsimple Cash. The new account offers users the ability to save and spend with one of Canada's highest non-promotional interest rates of 2.4% - in addition to a host of features that help people earn more on every dollar in their Cash account. Wealthsimple Cash combines a saving and spending account to give Canadians the power to have both an account that allows for everyday purchases while also providing a safe place to grow their money. Cash clients will benefit from no monthly account fees, no low balance fees, no foreign transaction fees worldwide, and ATM fee reimbursements - all through a sleek, metal card designed to make spending responsibly easy. "Canadians are used to the status quo when it comes to everyday banking - multiple accounts, high fees and low interest," said Michael Katchen, CEO and co-founder, Wealthsimple. "With Wealthsimple Cash, users can enjoy the power of a high interest savings account for all of their day-to-day spending needs ...
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