Regulation

• Author: Ari Kaplan/Mitch Frazer
• Pages: 131-199

131

CHA PTER 4

R EG UL ATIO N

A. INTRODUC TION

Every pension plan registere d in Ontario or covering persons employed

in Ontario is subject to the Pension Be nef‌its Act (PBA) and, is thereby,

within the jur isdiction of the Ontario pen sion regulator. This chap-

ter outlines the corporate and organi zational structure of the Ontario

pension regulator, the division of respon sibilities among its various

components, the scope of its jurisdiction to addre ss certain matters, and

its decision-making powers, pract ices, and procedures for adjudicating

pension disputes.

B. FINA NCIAL SERVICES REGULATORY

AUT HORI T Y

1) Introduction

“All persons who establish or administer a p ension plan within the mean-

ing of the Pension Benef‌its Act and al l employers or other persons on their

behalf who are required to contr ibute to any such pension plan” belong

to the “pension sector,” one of seven “regulated sectors”1 governed by

1 Financial Ser vices Regulatory Authority of O ntario Act, 2016, SO 2016, c 37, s 1(1),

“regulated s ector.” The other regulated sect ors include: (a) all credit unions,

caisses populaires, and league s to which the Credit Unions and Caisses Populaires

PENSIO N LAW132

the Financial Services Regulatory Authority of Ontario Act, 2016 (th e

FSRA Act).2 The FSRA Act established the Fin ancial Services Regulatory

Authority of Ontar io3 (FSRA), as a Crown agent,4 the purpose of which

is to “regulate and generally supervise the regulated sectors” and to

“contribute to public conf‌idence” in those sectors.5 The predecessor of

FSRA was the Financial Services Commission of Ontario (FSCO). FSRA

assumed the responsibilities of FSCO eective 8 June 2019.

There are four bodies associated w ith FSRA that part icipate in the

regulation of pension plans i n Ontario: the FSRA board of directors (the

Board), the executive branch of government, the Chief Executive Ocer

of FSRA, and the Financia l Services Tribunal (the Tribunal). Each is

discussed below.

2) Financial Services Regulatory Authority

a) Board composition and st ructure

The FSRA Act prov ides that the Board be composed of at least th ree

and not more than eleven members.6 Appointments are made by t he

Lieutenant Governor in Council in accordance wit h the Agencies and

Appointments Directive and the procedure s of the Public Appointments

Secretariat of the Govern ment of Ontario. One member is designated as

chair by the Lieutenant Gover nor in Council on the recommendation of

the Mini ste r.7 If the chair is absent or their oce is vacant, the present

directors shall choose one of them to act in the place of the chair.8 A

majority of the members of the Board constitutes a quorum.9

Act, 1994 applies; (b) all person s engaged in the business of i nsurance and gov-

erned by the Ins urance Act; (c) all corporation s registered or incorporated u nder

the Loan and Trust Corp orations Act; and (d) all mortgage brokerages, broker s,

agents, and admi nistrators license d under the Mortgage Brokerages, Lenders and

Administrators Act, 2006; (e) employees of the Ont ario provincial gover nment

or self-employed per sons who participate in pooled p ension plans under the

Pooled Registered Pension Pla ns Act, 2015; and will includ e (f) f‌inanc ial planners

and advisor s licensed under FinancialProfessio nals Title Protection Act, 2019,

when the Financial Profess ionals Title Protection Act comes into force .

2 SO 2016, c 37 [FSRA Act].

3 FSRA Ac t, s 2(1).

4 Ibid, s 2(3).

5 Ibid, s 3(1).

6 Ibid, s 8(2). The Board is curr ently comprised of seven member s, including the

cha ir.

7 Ibid, s 8(6).

8 Ibid, s 8(8).

9 Ibid, s 8(5).

Regulation 133

Under the FSRA Act, the Board appoints a Chief Executive Ocer

(CEO), who is “responsible for the management and administration”

of FSRA.10 Under the prior FSCO regime, thi s role was assumed by

the Superintendent of Financial Ser vices. The CEO is superv ised and

directed by the Board, but a quorum of the Board may, in writing, dele-

gate many of its powers and duties under the FSRA Act to the CEO.11

FSRA hires employees to as sist in the carry ing out of its mandate. Those

employees may be appointed as ocers if necessary.12

b) Statutory functions

In addition to its mandate to regul ate its sectors in the public interest,

FSRA has a number of specif‌ic f unctions under the FSRA Act. These

include collecting and enforcing amounts to be paid by employers to the

Pension Benef‌its Guarantee Fund;13, 14 collecting and enforcing the pay-

ment of such fees, levies, sector assessments, and other charges as may

be established by a rule of FSRA;15 preparing and publishing an annual

business plan;16 making ru les governing the fees, levie s, and other char-

ges FSRA may impose, including for f‌ilings, applications for licences or

registration, and compliance rev iews or audits made by FSRA.17 The

Board may make bylaw s with respect to the admini stration and conduct

of the regulator, the powers, functions, and duties of the cha ir, ocers,

and delegating duties of the Board to committee s or duties of an ocer

to employees.18 These bylaws are subject to approval of the Minister.19

FSRA may make rules in respect of any matter over which an Act

gives FSR A rule-mak ing authorit y.20 The Board may not delegate its

rule-making power, even to the CEO.21

10 Ibid, s 10(2).

11 Ibid, s 10(2.1).

12 Ibid, s 10(3).

13 Ibid, s 6.1. Section 82(3.1) of the Pensions Benef‌its Act, RS O 1990, c P.8, requires

non-exempt employers t hat provide def‌ined benef‌it plan s to make contributions

to the Pension Benef‌it s Guarantee Fund: see Chapte r 7

14 The FSRA Board i s required to establ ish an advisor y committee to advis e the CEO

on matters relate d to the Pension Benef‌its Guarant ee Fund: FSRA Act, s 10.1.

15 FSRA A ct, s 11(1).

16 Ibid, s 17.1. This must be provided to the Min ister of Finance and include such

content as the Min ister may require: FSCO Ac t, s 17.1(3).

17 FSR A Act, s 21(2).

18 Ibid, s 9(1).

19 Ibid, s 9(3).

20 Ibid, s 21(1).

21 Ibid, s 10 (2.2).