Ontario-Quebec trade agreement calls for harmonizing approaches to insurance regulation

An inter-provincial trade agreement, the Ontario-Quebec Trade and Cooperation Agreement, has come into force as of Oct. 1, and already some are calling for it to be more like the Trade, Investment and Labour Mobility Agreement (TILMA) between B.C. and Alberta.
Somewhat like TILMA, the Ontario-Quebec agreement proposes to “enhance the efficiency of the region’s financial markets by harmonizing approaches for regulating derivatives, credit unions, mortgage brokers, insurance and securities,” as the Province of Ontario states on its Web site.
In Alberta, insurance brokers are negotiating with the government over how to harmonize financial services rules in B.C., where credit unions are allowed to own insurance brokerages, with rules in Alberta, where credit unions are prohibited from owning insurance brokerages.
In his article Economic Note, David Descoteaux, an economist at the Montreal Economic Institute, predicts the Ontario-Quebec agreement will be a big win for credit unions, as it will “enable Quebec caisses populaires and Ontario credit unions to do business more flexibly in either province.”
Without getting into specifics about how it will happen, Descouteaux goes on to say “approaches in the insurance, securities, mortgage brokerage and credit cooperative sectors will also be harmonized.”
Descouteaux adds the Ontario-Quebec agreement could go further than it does, and compares it to the free trade agreement of TILMA.
“The Trade and Cooperation Agreement between Quebec and Ontario is a closed trade agreement, which means that the only areas subject to it are those it lists,” he writes. “In the case of an open trade agreement such as TILMA, all economic sectors are subject to the agreement, except for the exemptions it lists.
“This [TILMA] approach has the advantage of being more transparent by making the industries that seek to be excluded from the agreement’s rules highly visible in the public eye.”