The Ontario Securities Commission plans to focus on enforcement and retail investors in the year ahead.

In a draft of its proposed objectives and initiatives released today, the OSC lists five key organizational goals for the coming year, and outlines its strategies for achieving those goals.

The OSC is required to deliver its statement of priorities by June 30. Comments on today’s proposals are due by May 23.

Fair, vigorous and timely enforcement is the OSC’s top priority this year. Specifically, it plans to develop requirements for the Electronic Audit Trail system (TREATS). Moreover, the OSC pledges it will conduct a thorough review focused on enhancing its enforcement activities to ensure that it strategically selects cases for investigation and prosecution, enforcement is efficient and fair, and an effective process exists for identifying and moving to enforcement cases from all the OSC’s compliance functions. Also, it aims to increase public awareness of fraud prevention and detection efforts.

Understanding and addressing the needs of the retail investor is the OSC’s second goal. To that end, it pledges to:

  • engage retail investors in the regulatory process by seeking input through opportunities for consultation and education;
  • work to better inform investors;
  • actively encourage the securities industry to continue to raise the standards and transparency of conduct, service and advice in its interactions with retail investors;
  • increase efforts to protect investors against unsuitable investment products and advice; and
  • work with the government to establish a mechanism that would allow investors to pursue restitution in a timely and affordable manner.

The statement notes that the commission plans to publish for comment a national instrument that will require clearer and more understandable product and sales fee disclosure for investors in mutual funds, introduce more effective “cooling off” rights and result in the improved regulatory harmonization of the point-of-sale regimes for mutual funds and segregated funds.

It will also publish a national instrument that will require investment fund managers to implement an appropriate compliance program, and provide guidance on fair value pricing.

As its third goal, the OSC also pledges to promote a harmonized, simplified and strengthened securities regulatory framework for Canada. Specifically, the commission aims to:

  • harmonize and rationalize requirements for prospectuses;
  • introduce a fund governance regime for investment funds;
  • amend the national Income Funds policy to address emerging issues;
  • re-assess executive compensation disclosure requirements; and
  • harmonize the registration regime.

The OSC’s fourth goal is achieving appropriate regulatory integration of North American and global capital markets. “We will work to enhance the global competitiveness of our capital markets as well as foster cooperative relationships with other securities regulators and standards setters,” it says.

Finally, the OSC aims to be a more flexible, efficient and accountable organization.