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Ontario government to review SCFEA report

Phillips non-committal on splitting off OSC adjudicative function

Tuesday, October 19, 2004

By James Langton

In response to the Standing Committee on Finance and Economic Affairs report tabled in the Ontario Legislature yesterday, Gerry Phillips, chairman of Ontario’s Management Board committed to implementing a couple of the tamer recommendations from report. However, he said the most important recommendations will be reviewed by the government before it acts.

Phillips suggested that the government will move to adopt a civil liability regime for continuous disclosure and speed up the next five-year review. But, he remained non-committal on splitting off the OSC’s adjudicative function, and improving the system for investor redress.

Phillips suggested that the Ontario government will now develop proposed legislation in response to the report’s recommendations relating to civil liability for secondary market investors and new timelines for the next Review Committee. The government will also review all the recommendations in the SCFEA report, he added, after which it will be in a position to comment on how and when action will be taken on the remaining recommendations.

As for SCFEA’s recommendation that the adjudicative function of the OSC should be separated from its other functions, he said, “The Five Year Review Committee and the Fairness (or Osborne) Committee have confirmed that there is no evidence of bias in OSC proceedings, but the government will consider this recommendation with an open mind. We will address this issue in a way that does not compromise the effectiveness of our regulatory system.”

“The government continues to have every confidence in the OSC and that its internal procedures are effective in precluding bias,” Phillips said.

Phillips also applauded the endorsement of the single securities regulator idea that was delivered in the report from the all-party legislative committee. “We are very pleased with the work of the Standing Committee on Finance and Economic Affairs (SCFEA) and its endorsement of a single securities regulator for Canada,” Phillips said. “I am also pleased the committee has delivered a unanimous report. The report will help us ensure a modern securities regulatory system and strong investor confidence and protection.”

The report recommends supporting the province’s proposal for a single securities regulator, which Phillips continues to pursue even as several other provinces are banding together to develop a passport model of securities regulation. “The Ontario Legislature is signaling that the Ontario government is right to be taking a leadership role on a move to a common regulator for Canada,” Phillips said. “Ontario will continue to work with other provinces and territories to move toward a common securities regulator for Canada.”