The Participating Jurisdictions of the Canadian Securities Administrators (CSA) (the Participating Jurisdictions) have published CSA Collaboratory: Data Portability Project (the Report), which discusses data portability in the Canadian investment market and the potential benefits and challenges involved in giving investors more control over the data they provide to investment firms.
The Report was produced by the CSA’s Collaboratory, which is exploring the implications of new technologies and business models with interested stakeholders. Data portability was the first project undertaken by the Collaboratory. The project explored how investors’ personal and financial data, with a focus on Know Your Client (KYC) data, could be securely and efficiently transferred between market participants, including investment firms and financial technology (fintech) firms, at the investor’s request. Such portability would reduce friction and improve investor choice by facilitating the ability to switch financial providers or to open accounts at multiple firms.
Collaboratory participants – including the Participating Jurisdictions, representatives of the investment industry, third-party service providers, investor advocates and academics – explored the benefits and challenges of different data-sharing models. While there was no consensus on what model might work best, market participants agreed that increased data portability could be incentivized through legislation, regulation or guidance.
Some market participants noted uncertainty regarding use of third parties to assist them in collecting and transferring KYC information. With that in mind, some participants suggested that the CSA consider clarifying how KYC obligations should apply in the context of data portability.
The CSA decided not to pursue a live data portability test at this time because most commenters and meeting participants want to see details of the federal government’s consumer-driven banking framework. That framework, which will be overseen by the Bank of Canada, will enable individuals and businesses to share their financial data with accredited service providers of their choice. That federal framework would likely set foundational data-sharing standards relevant to investment firms and their customers.
Regulatory participants in this Collaboratory project will continue monitoring development of the federal framework and industry standards relating to data portability. The Participating Jurisdictions in the data portability project are: Autorité des marchés financiers (AMF), British Columbia Securities Commission (BCSC), Financial and Consumer Affairs Authority (FCAA) (Saskatchewan), Manitoba Securities Commission (MSC), Alberta Securities Commission (ASC), Financial and Consumer Services Commission (FCNB) (New Brunswick), Nova Scotia Securities Commission (NSSC), Prince Edward Island Office of the Superintendent of Securities, Newfoundland and Labrador Board of Commissioners of Public Utilities (Securities Division, Yukon Superintendent of Securities, Northwest Territories Superintendent of Securities, and, Nunavut Superintendent of Securities.
The Ontario Securities Commission (OSC) did not participate in the data portability project.
CSA Collaboratory: Data Portability Project is available for download from the website Canadian Securities Administrators.
For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606.
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