||(August 18, 2004) There
is a "persuasive and overwhelming" argument for separating the
adjudicative function of the Ontario Securities Commission and
creating a new independent body, a report released today concludes.
But the chair of the OSC believes Ontario might be better off
maintaining the status quo.
The report, written earlier this year by
a three-person committee chaired by lawyer Coulter
Osborne, states that a
"clear case for separating the commission's adjudicative function from its
other functions has been made. We therefore recommend that a securities
adjudicative tribunal be established."
Creating an Ontario Securities Tribunal
would alleviate the pervasive and widely held perception that a fair
hearing before the OSC is not possible, the report says, because of the
commission's overlapping roles of policymaker, investigator, prosecutor
The Osborne report was tabled today at
Queen's Park by OSC chair David Brown, who concedes he is "of two minds"
regarding its conclusions.
"Perception is very important," he said.
"But the integrated model appears to be working quite well," adding that
it's the standard for other administrative agencies across Canada, and not
just in the area of securities regulation.
"The perception issue is one that people
want to address, but to split the commission into a separate tribunal
strictly for the perception issue, ignoring all the reasons why we have so
many integrated agencies across the country, I think would be a mistake,"
Brown told reporters after his appearance before the standing committee on
finance and economic affairs, which is scheduled to deliver its
recommendations on the subject to the provincial government in October.
In addition, Brown notes that the
creation of an independent tribunal would risk the loss of the
securities-related expertise currently within the OSC. "You're not going
to get the kind of people you need for that tribunal," he said, pointing
out that such a tribunal might be more feasible if Canada had a national
"You can't have someone sitting on a
tribunal who is still active in the business world in a way that would
conflict with cases brought before it. So you'd be asking people with the
expertise to give up those associations to sit on a panel."
But Brown did not dismiss the Osborne
report's recommendations entirely. "If we can conceive of a different and
better model, I think we should go for it," he said. "But I think we are
better off leaving the structure as it is," he said.
IFIC president Tom Hockin also appeared
before same committee today and commented briefly on the Osborne report,
stressing that he had not actually read the study. "The OSC thinks they
are handling this the best they can, but I would side with the view that
they would benefit from this separation, that they would find their work
easier and that the public would be more comfortable," Hockin said, adding
that this was his personal view and that he has not consulted with IFIC
The Osborne report was delivered to the
OSC in March and the commission faced some criticism for delaying its
release until today. Brown explained that the OSC wanted to add a couple
of legal opinions to the report, and that those opinions were not
delivered until last week.
Filed by Doug Watt, Advisor.ca,