Incentives, Experts, and Regulatory Renewal

(2021) 47:1 Queen's Law Journal 38–77

40 Pages Posted: 14 Oct 2021 Last revised: 11 Feb 2022

See all articles by Douglas Sarro

Douglas Sarro

University of Toronto, Faculty of Law

Date Written: October 1, 2021


Updating rules to reflect new information about the world is easier said than done. Common approaches include providing for periodic review of legislation by the legislature and periodic review of regulation by a regulator. But Ontario securities law does something different. It calls for a full-scale review of securities legislation and regulation every four years by a committee of third-party experts appointed by the Minister responsible for administering securities law. This article takes a hard look at this process, which has generated significant controversy within the securities industry over the past year. Advisory committee members bring expertise to their roles and, unlike the government’s in-house experts (civil servants), presumably have no incentive to lean towards making recommendations that expand bureaucratic power. But it appears these third-party experts bring other incentives to the table—incentives that could impair the quality of their recommendations and subsequent legislative and regulatory change. This article identifies these potential incentives and proposes reforms that could mitigate the risks they pose. More broadly, the article serves as a case study illustrating the need to exercise care when outsourcing regulatory renewal to third-party experts.

Keywords: securities regulation, public choice, delegation, regulatory lookback

JEL Classification: K20, K22, K23, L51

Suggested Citation

Sarro, Douglas, Incentives, Experts, and Regulatory Renewal (October 1, 2021). (2021) 47:1 Queen's Law Journal 38–77, Available at SSRN:

Douglas Sarro (Contact Author)

University of Toronto, Faculty of Law ( email )


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