Smarter regulation: Unlocking Canada’s growth potential
Regulations are accumulating faster than opportunity. Now is the time to modernize Canada's regulatory environment to drive productivity, investment, and economic growth.
Modernizing regulation for a more competitive Canada
While regulation plays a critical role in protecting Canadians, rules that are overly complex or disconnected from underlying risks can create unnecessary barriers to economic growth.
Canada is seeking to encourage both domestic and international investment. Achieving those objectives will require a regulatory environment that protects Canadians while providing businesses with the confidence and certainty needed to invest, innovate, and grow.
The federal Red Tape Review provides an important foundation to modernize regulations. But to strengthen Canada's competitiveness and attract investment, policymakers will need to accelerate and prioritize reforms that have the greatest impact on productivity and investment.
Explore our Smarter regulation series, developed in consultation with industry associations, for ideas about practical, risk-based reforms that support investment and economic growth.
Why smarter regulation is an economic priority
With geopolitical and trade uncertainty continuing to impair economic growth, it’s more important than ever to focus on controllable barriers to investment. CEOs have stated, in surveys from 2023-2025, that the regulatory burden is the number one factor affecting companies’ plans to invest in Canada.
This shows up differently by sector, but the pattern is consistent:
- For infrastructure, the federal government has acknowledged that major projects have often taken more than five years to receive the federal decisions needed to begin construction.
- In energy, roughly $190 billion in oil and gas projects sit in planning, with the majority not yet under construction. This has been known to dissuade international organizations from investing in Canada given the extended timelines and uncertainty around approvals.
- In financial services, the share of labour costs devoted to compliance rose from 16% in 2019 to 22% in 2024, with the burden falling hardest on smaller firms. This cost is passed down to customers, which reduces economic activity.
- In defence, recent federal reviews point to a procurement system constrained by fragmented accountability, heavy governance, and excessive documentation that slows the delivery of major military capabilities. The result is delays in recognizing defence and economic benefits.
To address these barriers, we need to take a pragmatic and holistic approach to regulation in a “smarter” way.
Five principles for smarter regulation
The goal of the Smarter regulation series is to identify regulation and policies that strike the optimal balance of safeguarding Canadians while not stifling economic growth or investment.
In evaluating the design of both current and future regulations, we’ve defined five foundational principles:
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Explore the series
The Smarter regulation series highlights opportunities to reduce unnecessary complexity, improve regulatory outcomes, and support long-term economic performance. Developed in consultation with key stakeholders, the articles cover core sectors of the Canadian economy, including:
- Anti-money laundering in consultation with Canadian Bankers Association (CBA), launching the week of September 7
- Energy and infrastructure in consultation with Canadian Association of Petroleum Producers (CAPP), launching the week of September 14
- Defence in consultation with Canadian Association of Defence and Security Industries (CADSI), launching the week of September 21
- Fraud in consultation with Canadian Anti-Scam Coalition (CASC), launching the week of September 28
