The Ontario Securities Commission (OSC) will receive greater powers to protect investors under a bill introduced by Ontario Finance Minister Floyd Laughren in the legislature.
The Securities Amendment Act 1994 gives the OSC the power to make rules that would have the force of regulations in specific areas. Laughren says this power will allow the OSC to respond quickly and effectively to changes in the marketplace.
It will also promote public participation. Prior to becoming effective, a rule would be subject to a public notice and comment period and ministerial review.
“Ontario is the first jurisdiction in Canada to legislate rule-making powers for its securities commission, Laughren says. “There are indications that other provinces will be following Ontario’s lead. British Columbia recently announced it intends to provide rule-making powers to its securities commission next spring.
The bill responds to recommendations from the Ontario task force on securities regulation, chaired by University of Toronto law professor Ronald Daniels. The joint ministry of finance-OSC task force was set up in October, 1993, following judicial decisions in Ontario and British Columbia that raised concerns about the use of policy statements by securities regulators. Its final report was submitted June 30.
In addition to rule-making powers, the OSC will be able to issue policy statements, which are guidelines that do not have the force of law. Policy statements will also be subject to a public notice and comment period. The bill requires that the chairman of the OSC prepare an annual statement of priorities for the upcoming year and a report on the preceding year’s initiatives.
It also requires legislative review of the Securities Act every five years.
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