Canada’s provincial securities regulators are tough to push around.
For three years, the provinces, with the exception of Ontario, dug in as Finance Minister Jim Flaherty mounted a full frontal assault on their domain over securities, taking the matter to the Supreme Court of Canada. The judges sided with the provinces, forcing Mr. Flaherty to back off.
Now, the provincial regulators are about to be tested again, but by a vastly different foe: the Facebook generation.
Canadian Internet and technology entrepreneurs are gathering a volunteer army of lobbyists to force provinces to loosen restrictions on purchasing shares in closely held companies.
The battle is over crowdfunding, a money raising strategy that uses social media to round up relatively small contributions from multiple people. At stake is access to hundreds of millions of dollars in financing for Canadian start-ups.