By Andrew Elbaz, Partner – Securities and Capital Markets and Josh Hersh, Student-at-Law
In its testimony to Ontario’s Standing Committee on Finance and Economic Affairs (the “Committee”) on December 2, 2019, the industry trade group the Investment Industry Association of Canada (“IIAC”) spoke in support of the Ontario Securities Commission (“OSC”) being given blanket order powers.
Currently, section 143.11 of the Securities Act prohibits the OSC from making blanket orders, which are “any orders or rulings of general application.” This inability to make blanket orders prevents the OSC from issuing broad relief orders that apply to all participants within an industry. Instead, the OSC is limited to issuing selective orders to individual issuers.
The IIACs president and CEO, Ian Russel, also pointed out that the OSC is the only provincial regulator without the power to give blanket orders. The ability to make blanket orders would not only align the OSC with other provincial regulators but would allow it to provide more efficient and cost-effective relief.
The IIAC’s support of blanket orders is consistent with the amendments to the Securities Act that were proposed by the Ontario government on November 6, 2019. Schedule 34 of Bill 138, which is currently being considered by the Committee, seeks to permit blanket orders by amending the Securities Act to “allow the Commission to make an order exempting a class of persons or companies, trades, intended trades, securities or derivatives from any requirement of Ontario securities law on such terms or conditions as may be set out in the order.”
If the restriction on blanket orders is removed, it will be interesting to monitor the effect it will have on issuers in Ontario’s capital markets.