News Release

Vancouver – The B.C. Securities Commission has launched a survey to put a price tag on how much companies pay in regulatory costs and other expenses when raising capital in Canada.

The cross-Canada survey, part of a major initiative the commission launched last fall to reduce and simplify securities laws, targets companies that have raised money during the past two years on the TSX and TSX Venture exchanges.

The commission hopes to put precise figures to the concerns securities issuers and other market participants raise about the costs of securities regulation in Canada.

“We’re all familiar with the idea of the ‘regulatory burden’ in Canada and with the various approaches to addressing it,” says BCSC Vice Chair, Brent Aitken. “But there is no data available to quantify the cost of this burden. Industry needs to understand the actual costs of the current system in order to consider our proposals for a simplified regulatory regime.”

This inaugural cost-benefit survey, led by BCSC economist Christina Wolf, concentrates on the costs of disclosure borne by companies when they raise capital. It targets chief financial officers of the 270 public companies from the Yukon to Newfoundland that have raised capital since June 2000, either through an initial public offering or a secondary offering.

Listed companies will be asked to provide information in four key areas:
· Time and costs required to prepare offering documents and annual information forms
· The role of the underwriter in raising capital
· The costs associated with hold periods and escrow
· Time and costs involved in the ongoing regulatory burden, including preparing routine disclosure and responding to regulator communications

“This kind of data will provide us with real numbers about the actual costs of complying with complex regulation,” says Aitken. “We’re going directly to the companies with the most current financial information and we’re asking them, ‘What did it cost you? How much time did it take? If you could do it any way you wanted, what would you do differently?’

“Our review of the existing data shows that companies have never been asked for this kind of information.”

The web-based survey ends Aug. 9 and will be analyzed during the balance of the summer. The BCSC will share its findings with industry and plans to incorporate the information into the further development of its Continuous Market Access proposal, which was released along with other reform proposals in June.

The B.C. Securities Commission is the independent provincial government agency responsible for regulating trading in securities and exchange contracts within the province. Copies of the proposals can be viewed in the documents database of the commission’s website www.bcsc.bc.ca/bcproposals or by contacting Michael Bernard, Communications Manager, 604-899-6524.