BCN 2004/23 - Enforcement of Outcomes-Based Securities Legislation [BCN]
The British Columbia Securities Commission has published an analysis of the enforceability of new securities legislation in British Columbia. The study, Enforcement of Outcomes-Based Securities Legislation, is on the BCSC website at www.bcsc.bc.ca/policy.
On May 5, 2004 the British Columbia government introduced in the Legislative Assembly a new Securities Act (Bill 38).
One question asked by many of those who participated in the consultation process leading up to the introduction of Bill 38 was: “Can this new regime be enforced as effectively as the current legislation?” This study contains the results of the analysis done by the BCSC to answer this question.
The study concludes that:
- The most significant enforcement actions taken under the current legislation would continue to be supported by corresponding provisions in the new legislation. Of all contraventions, 92% were in areas in which the requirements under the new legislation are nearly identical, or substantially similar, to the current legislation, or have a similar “bright line” test.
- For some types of conduct (for example, conduct involving conflicts of interest), the new legislation would provide a more specific basis for enforcement action than the current legislation.
- Most of the new requirements in the new legislation would be readily enforceable because they would require measurable outcomes, use objective tests that are familiar to adjudicators, or deal with areas in which there is a clear understanding of what constitutes acceptable and non-acceptable conduct.
- The new requirements in the new legislation would be enforceable based on the development of industry standards, assisted by jurisprudence on the new rules.
- The new legislation would provide a solid foundation to take enforcement action against market misconduct.
Brent W. Aitken
This Notice may refer to other documents. These documents can be found at the B.C. Securities Commission public website at www.bcsc.bc.ca in the Commission Documents database or the Historical Documents database.