Reducing regulatory burdens for market participants: new Ontario task force

The OSC has announced a new initiative to reduce regulatory burdens for public companies, registrants and other market participants. Coordinating with the Ministry of Finance, and in support of the Ontario Government’s Open for Business Action Plan, the OSC has established a Burden Reduction Task Force¹ with a mandate to consider and act on any suggestions to eliminate unnecessary rules and procedures while still protecting investors and the integrity of Ontario’s capital markets.

Public companies, investment banks, investors and other market participants are invited to submit their suggestions to the OSC by March 1, either by e-mail at [email protected] or by using the Burden Reduction Survey.² On March 27, the OSC is hosting a related roundtable discussion. Any market participant interested in participating in the roundtable should submit a comment letter to the OSC and indicate a desire to participate.

The OSC’s announcement of the Task Force identifies several broad categories of potential burden-reducing initiatives, including:

• making operational or procedural changes at OSC branches so market participants’ day-to-day interactions with the OSC are more efficient;
• streamlining or eliminating rules, forms or filings that are overly burdensome or outdated; and
• modernizing investors’ interactions with issuers’ disclosure documents (e.g., greater use of interactive data, enhanced electronic communications).

Market participants have long been frustrated by the lack of harmonization of securities laws across Canada. The Task Force will pay special attention to harmonizing Ontario’s rules with the rules of other Canadian jurisdictions. Feedback has been requested specifically on how this can be done on an expedited and interim basis while related national initiatives (such as those discussed in Torys’ bulletin “The Burdens of Being a Public Company: Update on Potential Securities Regulatory Reform”) are still in progress. For important substantive rule changes, or where existing jurisdictional discrepancies are severe (e.g., the private placement regime), the OSC may need to seek cooperation from other regulators, either across Canada or perhaps among those participating in the cooperative capital markets regulatory system.

The Task Force will identify short-, medium- and long-term actions to reduce regulatory burdens. Potential rule changes will have to be published for public comment before becoming effective—meaning 2020 is likely the earliest time when any rule changes might come to fruition.

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¹ See http://www.osc.gov.on.ca/en/SecuritiesLaw_sn_20190114_11-784_burden-reduction.htm.

² See https://forms.office.com/Pages/ResponsePage.aspx?id=gLGWT5HnU0qu6YdvdcWOfdYt5j7cbTJEuU7Fg8Txd7hUMFRON0JPTVFZR0k3WFlFOURKVElGTFJKRS4u.