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News Release

Commission clarifies hearing disclosure rules in Smolensky and Cox decisions

  • Date:

    2001-02-16

  • Number:

    2001/05

Released: 02/16/01 Contact: Dean Pelkey
NR 01-05 (604) 899-6880 or
(BC only) 1-800-373-6393

Vancouver -- The British Columbia Securities Commission issued two decisions today that clarify disclosure standards for hearings before the Canadian Venture Exchange (CDNX).

The first decision deals with disclosure by respondents in CDNX proceedings.

In January, the CDNX ordered Arthur Murray Smolensky to provide disclosure to exchange staff in connection with an upcoming disciplinary hearing. Smolensky was ordered to disclose a witness list, a summary of the evidence the witnesses would give, and a list of documents on which Smolensky intended to rely at the hearing.

Smolensky appealed to the Commission, arguing that respondents have no duty to disclose the details of their defence.

A Commission panel upheld the CDNX order in an oral decision issued January 26.

In the written decision released today, the Commission panel said the disclosure order was consistent with the nature and function of securities regulation, and was narrower than what would be required in hearings before the Toronto Stock Exchange and other securities regulators.

The second decision deals with disclosure by CDNX staff.

In July last year, a CDNX hearing panel refused to order CDNX staff to disclose an investigation report to Thomas William Cox, who the CDNX alleges has contravened CDNX rules and bylaws.

The CDNX applied the disclosure standard established for exchange hearings by the Commission in previousdecisions. On that standard, disclosure is not required of materials prepared by staff, so the CDNX refused to order disclosure of the report. Cox asked the Commission to overturn the CDNX ruling, arguing that recent cases impose a higher standard of disclosure.

In the written decision released today, the Commission upheld the CDNX ruling, finding that the standard the Commission established in previous cases still applies.

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 decision can be viewed in the documents database of the commission’s website www.bcsc.bc.ca or by contacting Media Relations Officer Dean Pelkey at 899-6880.