Political Stability
Canada was created through the federation of several British Crown colonies in 1867. It is one of the oldest parliamentary democracies in the world. Legal responsibilities and powers are divided between those belonging to the national (federal) government in Ottawa and those belonging to the provincial governments. The Dominion of Newfoundland and Labrador joined Canada’s confederation of provinces in 1949.
Natural resources, transportation, health and education fall under the jurisdiction of the provinces.
Federal taxation is uniform across the country. Each province levies its own provincial tax.
Generous tax relief and benefits are provided by both levels of government to offset the risks inherent in the mining and exploration industry.
From federal tax revenues, transfer payments are made to selected provinces to maintain equalized standards between the provinces in the areas of education, health and transportation. These equalization payments between “wealthier” and “poorer” provinces is fundamental in promoting social stability and national unity across the country.
While Canadians are committed to creating a society based on equal opportunity for all fellow citizens, they are strongly committed to the system of free enterprise to generate economic growth and prosperity.
Both federal and provincial government policies encourage and support private investment.
Independent Judiciary and the Rule of Law
Judicial independence is the cornerstone of the Canadian judicial system. Canada’s Constitution has established the judiciary as separate from and independent of the other two branches of government, the executive and legislature. This Judicial independence guarantees that judges will be able to make decisions free of influence and based solely on fact and law.
Judicial Oversight
Several institutions have been established in Canada to support and monitor judicial independence. These include:
- the Canadian Judicial Council;
- the Commissioner for Federal Judicial Affairs;
- the National Judicial Institute and the Courts Administration Service.
Canada’s tradition of judicial independence is based on:
1. Administrative independence
No outside body can interfere with how courts manage the legal process and exercise their judicial functions.
2. Financial security
Judges are guaranteed generous compensation (salary and pension) so they are not subject to pressure for financial considerations.
3. Security of tenure
Once appointed, a judge is eligible to serve on the bench until retirement. Judges can only be removed by a joint address of Parliament or a provincial legislature and only after an independent and impartial investigation shows that there is good reason.
Corruption
Although all countries have laws against corruption, few countries observe them. Canadians do.
Acts of corruption in both the public and private sectors fall under Canada’s Criminal Code. Members of the judiciary and the police forces are very well compensated for their duties (through salaries and pensions) which significantly reduces the attractiveness of accepting a bribe, given the severe penalties for doing so. More importantly, corruption is not culturally accepted or tolerated in Canada.
Opposition parties, sitting in both the Federal and Provincial Parliaments, actively monitor members of the governing Party and public servants for any evidence of corrupt activities.
Stable Banking System
Canada boasts one of the most stable, if not the most stable, banking systems in the world. Canadian banks are federally chartered and created by an Act of Parliament. They are closely regulated and do not fail. The Government of Canada’s policy towards the banking sector has been to emphasize stability by having a fewer number of large banks that can provide national service to all parts of Canada rather than having a multitude of smaller regional banks. This federal policy has proven successful as the World Economic Forum has declared Canada’s banking system as the soundest in the world.
Canadian banks have supported federal government policy by providing banking services to even the most remote communities in Canada. It is estimated that over 99 percent of the population have a bank account.
The six largest chartered banks in Canada dominate the banking sector with a 90 per cent market share. The Royal Bank of Canada and the Toronto Dominion Bank rank amongst the 25 largest banks in the world. All Canadian banks owe their growth and both domestic and international success to providing banking services to the natural resources sector, particularly the mining and oil and gas industries. All banks have large mining finance groups, employing many of the world’s most experienced and sophisticated bankers to the mining and exploration industry.
Sophisticated and Mature Capital Markets Focused on Resource Industries
Toronto (Canada) is the principal financial centre of the world’s mining industry.
Approximately 75 percent of the world’s mining companies are headquartered in Canada and over 50 per cent of public mining companies are listed on the Toronto Stock Exchange (TSX) and Toronto Venture Exchange (TSXV). (Wikipedia) The TSX and TSXV are home to more mining companies than any other market in the world. Approximately 80 percent of the world’s equity trades in mining stocks takes place in Toronto’s markets (Wikipedia).
The Toronto Stock Exchange (TSX) and the Toronto Venture Exchange (TSXV) are the principal stock exchanges in Canada. The Toronto Stock Exchange is the senior equity market, while the TSX Venture Exchange is a public venture capital marketplace for emerging companies. Both stock exchanges are owned by the TMX Group
The Toronto Stock Exchange (TSX) opened in 1861. Today it is the 10th largest exchange in the world and the third largest in North America based on market capitalization. As of April 2023, Toronto Stock Exchange had 1,798 listed issuers (including ETFs and other structured financial products) with a combined market capitalization of CAD $4.0 trillion.
Toronto Venture Exchange (TSXV) was formed by the merger of the Vancouver Stock Exchange, the Alberta Stock Exchange, the Winnipeg Stock Exchange and the “small – cap” tier of the Montreal Stock Exchange in 1999.
These merged stock exchanges had traditionally focused on junior companies, those whose assets, business and market capitalization were too small to be listed on the Toronto Stock Exchange.
This new stock exchange was named the Canadian Venture Exchange (CDNX). In 2001 the TMX Group acquired the CDNX and renamed it the TSX Venture Exchange.
Canadian Securities Exchange
The Canadian Securities Exchange (CSE) was established in 2001and licenced to operate in 2004 by the Ontario Securies Commission. The CSE is located in Toronto, Ontario and maintains a branch office in Vancouver, British Columbia.
The focus of the CSE is on emerging public companies and their investors and its operations have been designed to meet the needs of entrepreneurs to access the public capital markets in Canada and internationally. The Exchange’s advanced technology and low fee structure help companies of all sizes minimize their cost of capital and maximize access to liquidity.
As of April 2022, the CSE had 778 listings with a market capitalization of $35.46 billion