(May 11 – 18:00 ET) – Susan Wolburgh-Jenah, general counsel at the Ontario Securities Commission appeared before the Standing Senate Committee on Banking, Trade and Commerce yesterday to speak regarding proposed changes to the Canada Business Corporations Act.

Wolburgh-Jenah suggested that the OSC is looking to become quicker and more responsive to regulatory issues, “you cannot take the time to always be making changes to the legislation itself.” She suggested that the OSC is looking to move to a model where the basic rules and penalties are laid out in statute but the details are contained in rules that can be passed by the commission.

She noted that the commission is currently undergoing its first review by an advisory committee of the finance ministry. These will be required every five years and she suggests they will enable the commission to better ensure its relevance. The committee is being chaired by Purdy Crawford QC, counsel to Osler, Hoskin & Harcourt, former chairman of Imasco and chairman of AT&T Canada and head of the committee examining analyst independence. It also includes Wolburgh-Jenah, Bill Riedl, president and CEO of Fairvest Securities Corporation, Helen Sinclair, CEO of BankWorks Trading Inc, David Wilson co-chairman and co-CEO at Scotia Capital Markets Inc., and Carol Hansell, a partner with Davies, Ward & Beck.

She went on to discuss the CBCA, and its relation to the Securities Act. She noted that in the area of insider trading rules it is important to harmonize the OSA and CBCA, otherwise they may “represent a trap for people who are unaware that the prohibitions that exist under the corporate law are different [from the securities laws].” For example she suggested that the two sets of rules could conflict on whether an investor can acquire up to 10% of a firm to make a takeover bid without triggering insider reporting requirements.

She also touched on the issue of shareholder communication. “We very much support permitting shareholders to communicate freely with one another. We agree that the original rationale for the restrictions in this area probably related to issues that are not as relevant today.” She noted that the OSC will move toward allowing freer shareholder communication, too.

– James Langton