NIN 94/28 - Proposed Amendments To The Securities Act [NIN - Rescinded]
| Published Date: | 1994-11-23 |
|---|---|
| Effective Date: | 1994-11-23 |
Six amendments to the Securities Act, which would implement part of the Government's response to the Matkin Report, were published for comment in a Special Supplement to the Weekly Summary for the week ending October 7, 1994. These proposed amendments would strengthen the regulation of underwriting and promotional activity and authorize the Commission to conduct compliance reviews of self regulatory bodies. See NIN#94/14.
The Commission is now publishing for comment further amendments that are not related to the Government's response to the Matkin Report. For convenience, the six amendments previously published are included in this package. The specific purposes of these amendments are:
- to strengthen the Commission's investigative and enforcement powers
- to provide authority for certain elements of a proposed package of amendments to the Securities Regulation
- to accommodate a system of electronic filing of documents, an initiative being carried out by securities regulatory authorities across Canada
- to clarify that the Commission can disclose certain personal information about registrants, directors, officers, promoters and control persons
- to make housekeeping amendments to maintain the currency of the legislation
- to maintain the uniformity of certain provisions of the legislation with the Ontario Securities Act
Request for Comments
Direct written comments by January 15, 1995 to:
Susan Adams
A/Director
Policy and Legislation
British Columbia Securities Commission
1100 - 865 Hornby Street
Vancouver, B.C. V6Z 2H4
Comment letters submitted in response to Requests for Comment are placed in the public file and form part of the public record, unless confidentiality is requested. Although comment letters requesting confidentiality will not be placed on the public file, freedom of information legislation may require the Commission to make comment letters available. Persons submitting comment letters should therefore be aware that the press and members of the public may be able to obtain access to any comment letter.
Certain other amendments to the Securities Act are being developed to implement other parts of the Government's response to the Matkin report and are expected to be published for comment in the near future. These amendments include:
- increasing the number of commissioners from 9 to 11
- expanding the civil remedies in the Act to provide a right of action for misrepresentations in press releases and letters to shareholders
- granting the Commission the power to apply to court for disgorgement orders
- confirming the Commission's power to make policy statements
- granting the Commission power to make legally binding rules
DATED at Vancouver, British Columbia, on November 23, 1994.
Douglas M. Hyndman
Chair
Attachment
Reference: NIN#94/14
PROPOSED AMENDMENTS TO THE SECURITIES ACT
Explanatory Notes
Section 1(1) "investor relations activities"
Defines "investor relations activities" to provide a basis for the Commission to regulate this activity in sections 35, 36.1 and 144 of the Securities Act and 134.2 of the Securities Regulation.
Section 1(1) "private mutual fund"
Makes only a trust company able to act as the promoter or manager of a private mutual fund administered by that trust company. The amendment is related to proposed repeal of sections 78 and 119 of the Securities Regulation, which restrict the use of the registration exemption set out in s. 32(c) of the Securities Act and the corresponding prospectus exemption. The restriction is necessary to ensure consistency with the Ontario Securities Act. In addition to s. 32(c) of the Securities Act and sections 78 and 119 of the Regulation, "private mutual fund" is also referred to in s. 159(1)(25) of the Act and as part of the definition of "mutual fund in the Province" set out in s. 1(1) of the Act. By narrowing the definition of "private mutual fund", the definition of "mutual fund in the Province" is expanded.
Interpretation
1. (1) In this Act, ...
"investor relations activities" means any activities or communications, orally or in writing, by or on behalf of an issuer or a security holder of the issuer that are intended to stimulate or would reasonably be expected to stimulate awareness of or interest in the issuer or its securities.
"private mutual fund" means a mutual fund that is
(b) administered by a trust company but which has no promoter or manager other than ^ a trust company, ^ and consists of(i) the securities issued by it are held by not more than 50 persons and it has never sought to borrow money from the public,
(ii) it does not pay or give any remuneration for investment, management or administration advice in respect of trades in securities, except normal brokerage fees, and
(iii) all of its members are required to make contributions, for the purpose of financing its operations, in proportion to the securities issued by it that each member holds, or
^(i) a pooled fund that is maintained solely to serve registered retirement savings plans, retirement income plans, deferred profit sharing plans, pension plans or other similar plans registered under the Income Tax Act (Canada),
^(ii) a common trust fund as defined by the Financial Institutions Act, or
^(iii) a pooled fund that is maintained by a trust company in which money, belonging to various estates and trusts in its care, is commingled, with the authority of the settlor, testator or trustee, for the purpose of facilitating investment where no general solicitations are made to sell securities in the fund; ...
Section 1(1) "associate" and "spouse"
Expands definition of "spouse" to include same-sex relationships. The definition is largely the same as that used in the Adult Guardianship Act; the Health Care (Consent) and Care Facility (Admission) Act; and the Representative Agreement Act.
Section 1(1) "officer" etc.
Gender inclusive language.
Section 1(1) "officer" etc.
Gender inclusive language.
"associate" means, where used to indicate a relationship with any person,
(b) a trust or estate in which that person has a substantial beneficial interest or for which that person serves as trustee or in a similar capacity,
(c) an issuer in respect of which that person beneficially owns or controls, directly or indirectly, voting securities carrying more than 10% of the voting rights attached to all outstanding voting securities of the issuer, or
(d) a relative, including the spouse, of that person or a relative of that person's spouse, where the relative has the same home as that person ^; ...
"spouse" means a person who
(b) is living with another person in a marriage-like relationship,
and, for the purpose of this definition, the marriage or marriage-like relationship may be between members of the same sex;
1(1) definition of "officer" and "senior officer", 4(4), 4(7), 4(9), 5, 6(1), 102 and 144.2
Replace "chairman" with "chair" and make corresponding changes to personal pronoun "him" and to the possessive pronoun "his".
1(1) definition of "officer" and "senior officer", 4(4), 4(7),
4(9) and 6(1).
Replaces "vice chairman" with "vice chair" and makes corresponding changes to the personal pronoun "him".
Section 1(1) "salesman" etc.
Gender inclusive language. Similar amendments are proposed to be made to the Securities Regulation.
Section 1(1) "designated organization" etc.
Clarifies that the role of the chief administrative officer of the Commission is not limited to regulating "brokers", who are regulated in the first instance by the Vancouver Stock Exchange under the Vancouver Stock Exchange Act. Conforms to the title of chief administrative officers used in other Canadian jurisdictions (e.g. the Ontario Securities Act now uses the term "Executive Director").
Section 7
Substitutes "executive director" for "superintendent".
By separating s. (1.1) from s. (1), the method of appointment of the executive director is more clearly distinguished from the appointment of other employees. Further amendments to s. (1.1) may be required to implement the government's decision in response to the Matkin Report to give the Commission financial autonomy. In addition, s. (1.1) adds a new reference to powers and duties imposed under the regulations (as well as the Act).
1(1) definition and in subsection (c) of the definition of "senior officer", 25, 25(a)(i), 25(a)(ii), 25(b); salesmen - 19, 33(2)(a), 159(1)(22)
Replaces "salesman" with "salesperson" and "salesmen" with "salespeople".
1(1) "designated organization", 1(1) "distribution", 1(1) "superintendent", 6(1), 6(2), 7(1)-(6), 13(2), 15(2), 20(2), 21(1), 21(3), 22(2), 22(3), 24, 24(c), 25, 27, 28(4), 28(5), 31(2)(4), 31(2)(8), 31(2)(14), 31(2)(21)(i)-(ii), 31(3), 31(4), 42(1), 45(1), 45(2), 46(1)-(3), 47(3), 49(4), 49(5), 50(2), 52(1), 52(3), 55(2)(3), 55(2)(7), 55(2)(13), 55(2)(18)(i)-(ii), 55(3), 55(4), 59(2), 60(1), 61(1), 64, 73(1)(a)-(b), 73.1, 74(2)(d), 92(3), 108(a), 125.1(1), 125.1(2), 138(1)(a), 143(2)-(3), 144(2)-(4), 147(1), 147(2), 147(6), 148(1), 148(3), 149(1)(b), 150, 153, 154, 154.2, 155, 156(1), 158(1), 158(2), 159(1)(3), 159(1)(7), 159(1)(10), 159(1)(14.1)(iii), 159(1)(30), 159(1)(33), 159(1)(35), 159(1)(36), 159(1)(37), 159(1)(38), 159(2)(a), 159(2)(d)(i), 159(2)(f), and 159(3)
Replace "superintendent" with "executive director" and make corresponding changes to personal pronouns "he" and "him" and possessive pronoun "his".
Superintendent
7. (1) The ^ executive director shall be appointed by the commission ^.
(1.1)Employees necessary to enable ^ the executive director and the commission to ^ exercise the powers, and perform ^ the duties, ^ of the executive director and commission under this Act and the regulations shall be appointed under the Public Service Act.
(2) The ^ executive director is the chief administrative officer of the commission and shall obey the policy directives given by the commission.Section 7(7)
As a consequence to s. 23(2) of the Interpretation Act, R.S.B.C. 1979, c. 206, deputies are empowered to act in the executive director's place where the executive director is directed or empowered to do something. Subsection (7) clarifies that the directors of various divisions within the commission may act without express delegation.
Section 13(1.1)
Imposes a requirement on an exchange to regulate issuers that are listed or traded on the exchange.
(3) The ^ executive director may exercise the powers and shall perform the duties vested in or imposed on
(a) ^ the executive director under this Act or the regulations, and
(b) the commission under this Act or the regulations that are delegated to ^ the executive director by the commission.(4) The ^ executive director may, by conditional or unconditional written authority, delegate the ^ executive director's powers and duties under this Act, the regulations or another enactment to any person employed under subsection (1.1).
(5) Notwithstanding subsection (4), the ^ executive director shall not delegate
(a) powers or duties of the commission that are delegated to ^ the executive director by the commission, or
(b) a power or duty referred to in section 64, 73, 144, 148 (3) or 158 of this Act.
(6) A person to whom the ^ executive director, by written authority under subsection (4), delegates ^ the executive director's powers and duties may exercise the powers and shall perform the duties in accordance with the written authority.
(7)Directors employed in the office of the executive director are deemed to be deputies of the executive director.
Duty of self regulatory body and exchange
13. (1) Subject to this Act, the regulations and any decision made by the commission, every self regulatory body and every ^ exchange shall regulate the standards of practice and business conduct of its members.
(1.1) Subject to this Act, the regulations and any decision made by the commission, every exchange shall regulate the listing and trading of securities on that exchange.
Section 13(2)
Makes section apply to former registrants whose registration has expired or terminated. New paragraph (d) broadens the scope of information that may be requested from a self regulatory body or exchange.
Section 15
Permits the executive director to appeal to the Commission a direction, decision, order or ruling of a self regulatory body or exchange. For example, the executive director could appeal a decision made by the Vancouver Stock Exchange to list an issuer or to approve a corporate transaction. The executive director could also appeal a decision made by the Vancouver Stock Exchange or the Pacific District of the Investment Dealers Association of Canada in a matter of member discipline. The proposed amendments expand on the existing ability set out in s. 148 of the Securities Act, which provide a right for the superintendent to appeal a decision of a "designated organization" (Vancouver Stock Exchange or the Pacific District of the Investment Dealers Association of Canada) with respect to matters delegated under section 159(2) of the Act.
Section 15.1
Authorizes the executive director to conduct compliance reviews of the Pacific District of the Investment Dealers Association of Canada and the Vancouver Stock Exchange, during normal business hours, to check compliance with the Securities Act, the Securities Regulation and any decision made under the Act or Regulation. A similar provision for dealers, underwriters and advisors is included as s. 24.1 of the Securities Act.
(2) A self regulatory body or ^ exchange shall provide to the commission or to the ^ executive director, at the request of the commission or the ^ executive director, any information or record in its possession relating to
(c) trading in securities or exchange contracts, or
(d) (i) a bylaw, rule or other regulatory instrument or policy, or
(ii) a direction, decision, order or ruling made under a bylaw, rule or other regulatory instrument or policy,
of the self regulatory body or exchange.
Hearing and review
15. (1) The executive director or a person directly affected by a direction, decision, order or ruling made under a bylaw, rule or other regulatory instrument or policy of a self regulatory body or ^ an exchange may apply to the commission for a hearing and review of the matter under Part 17 of this Act, and section 147(3) to (5) applies.
(2) An applicant under subsection (1), other than the executive director, shall send a copy of the notice requesting a hearing and review to the ^ executive director and to the affected self regulatory body or ^ exchange.
(3) Where the applicant under subsection (1) is the executive director, the executive director shall send a copy of the notice requesting a hearing and review to the affected self regulatory body or exchange and to the persons directly affected by the direction, decision, order or ruling referred to in subsection (1).
Compliance review of self regulatory body or exchange
15.1 (1) The executive director may appoint in writing a person to review, examine and audit the records, business and conduct of a self regulatory body or exchange.
(2) A person conducting a compliance review under this section may, on production of the appointment,
Section 20
Gender inclusive language. In paragraph (c), codifies existing practice of registering employees of advisers who may not be partners, directors or officers of the adviser. Related amendments are proposed to the Securities Regulation.
Section 20(3)
Incorporates the new term "executive director".
(b) review, examine and audit the records of the self regulatory body or exchange,
(c) make copies of the records referred to in paragraph (b), and
(d) make inquiries of the self regulatory body or exchange, or persons employed by the self regulatory body or exchange, concerning the operations and procedures of the self regulatory body or exchange.
(3) The executive director may require a self regulatory body or exchange that is the subject of a compliance review under this section to pay prescribed fees or charges for the costs of the review.
Requirement of registration
20. (1) No person shall
(a) trade in a security or exchange contract unless ^ the person is registered as
(i) a dealer, or
(ii) a ^ salesperson, partner, director or officer of a registered dealer and is acting on behalf of that dealer,
(c) act as an adviser unless ^ the person is registered as
(i) an adviser, or
(ii) an advising employee, partner, director or officer of a registered adviser and is acting on behalf of that adviser in accordance with the regulations.
Requirement of registration
20. (3) A person applying for registration under this section shall not trade in a security or exchange contract or act as an underwriter or advisor until ^ the person has received written confirmation of ^ the registration from the ^ executive director.
Section 21(2)(a)
Addition of advising employee is consequential to proposed amendments to s. 20(1)(c)(ii) of the Securities Act and is related to proposed amendments to the categories of registration set out in the Securities Regulation. Ordering of "partner, director and officer" conforms to s. 20(1)(a)(ii) and (c)(ii) of the Securities Act.
Section 22
Broadens the restrictions that the executive director may impose after an opportunity to be heard which facilitate greater control over, for example, the sale of "exempt" securities by salespersons of mutual fund dealers. Complementary authority will be included in s. 144(1)(f) of the Securities Act.
Granting registration
21. (2) Where an applicant or partner, director or officer ^ of an applicant is not a resident of the Province on the date of application, the ^ executive director may refuse to register the applicant unless, at the time of application, the applicant or the applicant's partner, director or officer ^
(a) is registered in a capacity corresponding to that of a dealer, underwriter, adviser, ^ salesperson, advising employee, partner, director or officer ^ under the law of the jurisdiction respecting trading in securities or exchange contracts, as the case may be, in which the applicant last resided, and
(b) has been so registered for at least one year immediately before the date of application.
Conditions imposed on registration
22. (1) The ^ executive director may restrict a registration or renewal or reinstatement of registration ^ and may impose conditions on ^ the registrant and, without limiting ^ these powers, may ^
(a) restrict the duration of the registration, ^
(b) restrict the registration to trades in specified securities or a specified class of securities or class of exchange contracts, and
(c) direct that any or all of the exemptions described in sections 30 to 32 of this Act do not apply to the registrant.(2) The ^ executive director shall not restrict a registration or impose a condition on a ^ registrant under subsection (1) without giving the applicant an opportunity to be heard.
(3) A registrant shall comply with a restriction or condition imposed ^ under the regulations or by the ^ executive director under subsection (1).
Section 24.1
Authorizes the executive director to conduct compliance reviews of registered dealers, underwriters or advisers, and former registered dealers, underwriters or advisers, during normal business hours, to check compliance with the Securities Act, the Securities Regulation and any decision made under the Act or Regulation. A similar provision for self regulatory bodies and exchanges is included as s. 15.1 of the Securities Act.
Section 28
Requirement to file a notice of change of name conforms to the existing requirements of Forms 7 and 7A. Addition of "advising employee" in subsection (3) is related to proposed amendments to s. 20(1)(c) of the Act and to proposed amendments to the Securities Regulation. Deletion of "registered" removes a redundancy given the introductory wording of each of subsections (1) to (3).
Compliance review of registrant
24.1.(1) The executive director may appoint in writing a person to review, examine and audit the records, business and conduct of a registered dealer, underwriter or adviser for the purpose of determining whether the registrant or former registrant is complying, or has complied, with this Act, the regulations and any decision made under this Act or the regulations.
(2) A person conducting a compliance review under this section may, upon production of the appointment,
(a) enter the business premises of a registered dealer, underwriter or adviser, during business hours,
(b) inquire into, examine and audit the records of the registrant that are required to be kept under this Act or the regulations,
(c) make copies of the records referred to in paragraph (b), and
(d) make inquiries of the registrant, or persons employed by the registrant, concerning the operations and procedures of the registrant.(3) The executive director may require a person that is the subject of a compliance review under this section to pay prescribed fees or charges for the costs of the review.
Notice of change
28. (1) Subject to the regulations, a registered dealer shall immediately file in the required form a notice of
(a) the opening or closing of a branch office, in the Province, of the ^ dealer,
(b) a change in the partners, directors or officers of the ^ dealer and, in the case of termination of employment or of office by any means, the reason for termination,
(c) commencement or termination of the employment of a registered ^ salesperson and, in the case of termination of employment by any means, the reason for termination,
(d) a change in(i) the address for service, in the Province, of the ^ dealer,
(ii) any business address of the ^ dealer,
(iii) the holders of any of the voting securities issued by the ^ dealer,Section 30(1)
Excludes, for example, student members of the accounting profession, as well as accountants who have not joined the British Columbia branch of their professional organization (and therefore are not permitted to call themselves CAs, CGAs or CMAs).^
(iv) the name and address of the person in charge of any branch office, in the Province, of the ^ dealer, or
(v) the name of the dealer or of any partner, director or officer of the dealer.(2) Subject to the regulations, a registered adviser or a registered underwriter shall immediately file in the required form a notice of a change in
(a.1) commencement or termination of the employment of a registered advising employee and, in the case of termination of employment by any means, the reason for termination,
(c) any business address of the ^ adviser or ^ underwriter,
(d) the holders of any of the voting securities issued by the ^ adviser or ^ underwriter, or
(e) the name of the adviser or underwriter or of any partner^, director or officer of the ^ adviser or ^ underwriter.
(3) Subject to the regulations, a registered ^ salesperson and a registered advising employee shall immediately file in the required form a notice of a change in
(b) any business address of the ^ salesperson or advising employee, ^
(c) the employment of the ^ salesperson or advising employee by a registered dealer or registered adviser, respectively, o
Advisers
30. (1) For purposes of this section, "accountant" means an individual who is a member in good standing, not including a student member, of a corporation having statutory authority to regulate its members in the practice of accountancy in the Province.
Section 30(2) - (5)
Paragraph 2(d) is intended to provide an exemption where, for example, a "full service" dealer offers its clients and others research on reporting issuers that has been prepared by employees of the dealer. In paragraph (2)(e), by replacing the existing reference to "employee" with "salesperson", an ambiguity is removed. Re-ordering of "partner, director and officer" from "partner, officer or director" conforms to s. 20(1)(a)(ii) and (c)(ii) of the Securities Act and to the drafting used in the Securities Regulation.
Subsection (3) clarifies the Commission's position regarding advising activities of financial institutions which, after financial institution reform purport to varying degrees (including by advertisement) to be able to offer advising services without registration.
New subsection (4) recognizes that advising is not "solely incidental" for salespersons and other registrants that, in fact, have a duty under s. 43 of the Securities Regulation to ensure the suitability of client investments.
New subsection (5) clarifies that the advising exemption does not extend to discretionary authority over client accounts.
Section 31(2)
The proposed amendment clarifies that the exemption from registration applies only to registration under section 20(1)(a) as a dealer or salesperson, partner, director of officer of a dealer. In the Commission's view, this is already implicit in the fact that the exemption applies to "trades" and not to advising or underwriting.
(2) Subject to subsections (3), (4) and (5), the following persons may act as advisers without registration under section 20(1)(c):
(b) the Federal Business Development Bank;
(c) a barrister and solicitor or an accountant;
(d) ^ a registered dealer, with respect to research reports or similar analysis prepared by an employee of the dealer and distributed by the dealer;
(e) a registered dealer or a registered partner, ^ director,officer or salesperson of a registered dealer;
(f) a publisher of, or writer for, a bona fide newspaper, news magazine or business or financial publication, that is of general and regular paid circulation, distributed only to subscribers to it for value or to purchasers of it, who
(i) gives advice as an adviser only through the newspaper, magazine or publication,
(ii) has no direct or indirect interest in any of the securities or exchange contracts in respect of which ^ the person gives advice, and
(iii) receives no commission or other consideration for giving the advice other than for acting in ^ the person's capacity as a publisher or writer;
(3) A person is exempted under subsection (2)(a), (b), (c) ^ or (f) so long as the ^ act of advising is solely incidental to ^ the person's principal business or occupation as stated in those paragraphs and, where the person advertises its business, advising does not feature in the advertisements.
(4) A person is exempted under subsection (2)(e) so long as the act of advising is solely in fulfilment of the person's duty to ensure the suitability of a proposed purchase or sale for a client.
(5) Subsection (2) does not exempt a person from the requirement to register under section 20(1)(c) where the person manages the investment portfolio of a client through discretionary authority granted to the person by the client.
Exemption of trades
31. (2) Subject to the regulations, registration under section 20(1)(a) is not required for the following trades in securities: ...
Section 32(d)
The Ombudsman's report on "The Sale of Promissory Notes in British Columbia by the Principal Group Ltd." raised concerns about use of the exemption in section 32(d) of the Securities Act to sell short term promissory notes to individuals. The new provision removes the ability of issuers to trade short term promissory notes and commercial paper to individuals under this exemption. (Pending implementation of the new provision, the Commission proposes, in the Securities Regulation, to increase the minimum amount that can be traded to an individual under the exemption from $50,000 to $1,000,000). The change from s. 20(1) to 20(1)(a) clarifies that the exemption is only from the requirement to register as a dealer, or salesperson, partner, director or officer of a dealer.
Section 32(k)
Prevents the possibility that corporate local issuers might use this exemption to avoid filing a prospectus. Sections 32(j) of the Act and 117(a) of the Securities Regulation may also be available to a prospector.
Section 32(l)
If a prospecting syndicate is offering securities to the public, it should file a prospectus. Sections 32(j) of the Act and 117(a) of the Securities Regulation may also be available to a prospecting syndicate.
Section 32(m)
If a prospecting syndicate is offering securities to the public, it should file a prospectus. Sections 32(j) of the Act and 117(a) of the Securities Regulation may also be available to a prospecting syndicate.
Section 34
Re-ordering of "salesperson" and of "partner, director and officer" from "partner, officer or director" conforms to s. 20(1)(a)(ii) of the Securities Act and to the drafting used in the Securities Regulation. Addition of "advising employee" is consequential to amendment of s. 20(1)(c) of that Act and related to amendments to the Regulation. Adds "agent" to parallel section 138(3) of the Act.
Exemption when trading in certain securities
32. Subject to the regulations, a person may trade in the following securities without being registered under section 20(1)(a):
...
(d) negotiable promissory notes or commercial paper maturing not more than 12 months from the date of issue so long as(i) each note or commercial paper is not convertible or exchangeable into or accompanied by a right to purchase another security other than a security described in this section, and
...
(k) Repealed.
(l) Repealed.
(m) Repealed.
Calling at or telephoning residence
34. (4) For purposes of this section, a person shall be conclusively deemed to have called or telephoned where a salesperson, advising employee, partner, director officer ^ or agent of the person calls or telephones on that person's behalf.
Section 35
Imposes restrictions on representations that can be made by persons engaging in investor relations activities and specifically prohibits a person involved in investor relations or trading from making a misrepresentation.
Representations prohibited
35. (1) No person, while engaging in investor relations activities or with the intention of effecting a trade in a security,
(a) shall represent that the person or another person will
(i) resell or repurchase the security, or
(ii) refund all or any of the purchase price of
the security,
(c) shall represent, unless the person obtains the written permission of the ^ executive director,
(i) that the security will be listed and posted for trading on an exchange, or
(ii) that application has been or will be made to list and post the security for trading on an exchange, or
(2) Subsection (1) (a) does not apply to a representation
(b) contained in a written agreement where the security involved has an aggregate acquisition cost in excess of a prescribed amount.
(3) No person, with the intention of effecting a trade in an exchange contract,
(ii) assume all or part of the obligation under the exchange contract, or
Section 36.1
Requires disclosure of the relationship between an issuer and a person engaged in investor relations activities. This will assist investors in assessing the objectivity of information received from a person engaged in investor relations activities.
Section 42(3), 114(16) and 159(1)(12)
Replace "short form" with "simplified" to be consistent with National Policy Statement No. 36 - Mutual Funds: Simplified Prospectus Qualification System and proposed amendments to the Securities Regulation.
Section 48
Subsection (2) is made uniform with section 57(2) of the Ontario Securities Act. Subsection (3) is made uniform with subsection (1) and new subsection (2).
Disclosure of investor relations activities
36.1 (1) An issuer or security holder that has retained a person to engage in investor relations activities, or knows or ought reasonably to know that a person is engaged in investor relations activities on behalf of the issuer or a security holder of the issuer, must immediately disclose that fact to anyone who inquires.
(2) A person engaged in investor relations activities, and an issuer or security holder on whose behalf the investor relations activities are undertaken, shall ensure that every record disseminated by the person engaged in investor relations activities clearly discloses, in a conspicuous position, that the record is issued by or on behalf of the issuer or security holder.
42(3), 114(16) and 159(1)(12)
Replace "short form" of preliminary prospectus and "short form" of prospectus with "simplified" preliminary prospectus and "simplified" prospectus.
Amendment to prospectus48. (1) Where, after a receipt is issued for a prospectus but before the completion of the distribution under it, a material change occurs in the affairs of an issuer, the person who is making the distribution shall file an amendment to the prospectus disclosing the change, as soon as practicable, and in any event no later than 10 days after the change occurs.
(2) Where, after a receipt is issued for a prospectus but before the completion of the distribution under it, additional securities of the same class of securities previously disclosed in the prospectus are to be distributed, the person making the distribution shall file an amendment to the prospectus disclosing the additional securities, as soon as practicable, and in any event no later than 10 days after the decision to increase the number of securities offered is made.
(3) Where, after a receipt is issued for the prospectus but before the completion of the distribution under it, the terms or conditions of the offering disclosed in the prospectus are to be altered, the person making the distribution shall file an amendment to the prospectus disclosing the change, as soon as practicable, and in any event no later than 10 days after the decision to alter the terms and conditions is made.
Section 48.1
Imposes a positive obligation on directors, underwriters and others that sign a certificate to conduct due diligence reviews. More detailed requirements are contained in the Securities Regulation and Local Policy Statement 3-22 on registration requirements.
Section 64
Expands the application of the power to cease trade to situations in which the prospectus does not substantially comply with the requirements of the Securities Act and Securities Regulation.
Section 66
Clarifies that withdrawal rights exist for purchasers where the prospectus or amendment has not been filed. In addition, clarifies that a purchaser is entitled to receive an amendment to a prospectus where the obligation to file the amendment arises before the agreement of purchase and sale of the security has been entered into and that withdrawal rights also apply to an amendment to which the purchaser is entitled.
(4) The ^ executive director shall issue a receipt for an amendment to a prospectus filed under this section and section 46(2) and (3) applies.
(5) Except with the written permission of the ^ executive director, a distribution or an additional distribution shall not proceed until a receipt for an amendment to a prospectus that is required to be filed under this section is issued by the ^ executive director.
Due diligence
48.1Before a certificate under section 49 or 50 is signed,
(a) the directors of the issuer and any other person that signs the certificate under section 49, and
shall each conduct a reasonable investigation to provide reasonable grounds for a belief that there has been no misrepresentation in the prospectus.
Defective preliminary prospectus
64. Where the ^ executive director considers that a preliminary prospectus does not substantially comply with the section 44 ^ the executive director, may without giving notice, order that trading which is permitted by section 61(2) in the security to which the preliminary prospectus relates cease until a revised preliminary prospectus satisfactory to the ^ executive director is filed and sent to each recipient of the defective preliminary prospectus according to the record maintained in section 63.
Obligation to send prospectus
66. (1) A dealer, not acting as agent of the purchaser, who receives an order or subscription for a security offered in a distribution to which section 42 applies shall send to the purchaser
(a) before entering into the written confirmation of the sale agreement resulting from the order or subscription, or
(b) not later than midnight on the second business day after entering into the agreement,the latest prospectus with respect to the security, and any amendment to that prospectus, filed ^ or required to be filed under this Act.
Section 66(3)
Subsection (3), together with the amendment to section 156, make the provision uniform with subsection 71(2) of the Ontario Securities Act that permits telegraphic notice.
(2) Notwithstanding subsection (1), a dealer shall not be required to send an amendment to a prospectus to a purchaser where the agreement of purchase and sale of the security has been entered into before the obligation to file ^ the amendment arises under section 48.
(3) A sale agreement referred to in subsection (1) is not binding on the purchaser if the dealer from whom the purchaser purchases the security receives, not later than 2 business days after receipt by the purchaser of the latest prospectus, and any amendment to the prospectus, that the purchaser is entitled to receive under this Act, written notice sent by the purchaser evidencing the intention of the purchaser not to be bound by the agreement.
(4) Subsection (3) does not apply if the purchaser(a) is a registrant, or
(b) disposes of the beneficial ownership of the security referred to in subsection (3), otherwise than to secure indebtedness, before the expiration of the time referred to in subsection (3).(5) For the purposes of this section, subject to subsection (7), receipt of the latest prospectus, and any amendment to the prospectus, that the purchaser is entitled to receive under this Act, by a dealer who
(a) is acting as agent of, or
(b) after receipt commences to act as agent of,the purchaser with respect to the purchase of a security referred to in subsection (1) is deemed to be receipt by the purchaser on the date on which the dealer received the prospectus and any amendment to that prospectus.
(6) For the purposes of this section, receipt of the notice referred to in subsection (3) by a dealer who acted as agent of the seller with respect to the sale of the security referred to in subsection (1) is deemed to be receipt by the seller on the date on which the dealer received the notice.
(7) For the purposes of this section, a dealer does not act as agent of the purchaser unless he is acting solely as agent of the purchaser with respect to the sale in question and has not received and has no agreement to receive compensation from or on behalf of the seller with respect to that sale.
(8) The onus of providing that the time for giving notice under subsection (3) has expired is on the dealer from whom the purchaser has agreed to purchase the security.
Section 69.1
This section is moved from section 148 of the Securities Regulation, which is proposed to be repealed. Makes uniform with the Ontario Securities Act, section 106(2) by requiring insiders to report options on securities of reporting issuers that a third party has granted to the insider.
Section 71
It is virtually impossible for a securities depository to know that securities are beneficially owned by an insider and that the insider has failed to file a report. Therefore this section is proposed to be repealed.
Section 73(3)
Removes reference to "by electronic means that produce a printed copy" in order to implement the System for Electronic Document Analysis and Retrieval ("SEDAR") and allows the Commission and executive director greater flexibility in how they give notice.
(9) Where the issuer acts as his own dealer in respect of a trade, this section applies to the issuer as if he were a dealer.
Interpretation
(a) the acquisition or disposition of a put, call or other transferable option respecting a security is a change in the beneficial ownership of that security, and
(b) for the purpose of reporting under section 70, ownership passes when
(i) an offer to sell is accepted by the purchaser or the purchaser's agent, or
(ii) an offer to buy is accepted by the seller or the seller's agent.
Report of a Transfer
71 Repealed.
Halt trading order
73. (3) Where
(a) a security affected by an order made under subsection (1) is listed and posted for trading on an exchange in the Province, or
(b) an exchange contract affected by an order made under subsection (1) is traded on an exchange in the Province,the commission ^ or executive director shall immediately ^ send written notice of the order to the exchange, and the order becomes effective, for all purposes and in respect of all persons, as soon as the exchange ^ receives the notice.
Section 96(2)
Makes uniform with the Ontario Securities Act section 104(2).
Section 101(2)(b)
Eliminates awkward wording and makes more uniform with section 86(1)(b) of the Ontario Securities Act.
Section 108.1
Imposes statutory duties on management of mutual funds and is modelled on section 116 of the Ontario Securities Act.
Applications to the commission
96. (2) On application by an interested person or on the commission's own motion ^ the commission may, where the commission considers that to do so would not be prejudicial to the public interest,
(c) order that a person or class of persons is exempt from one or more of the requirements of this Part or the regulations related to this Part ^.
Solicitation of Proxies
101. (2) No person shall solicit proxies from security holders unless, ...
(b) in the case of ^ any other solicitation, the person soliciting the proxies, concurrently with or before the solicitation, sends an information circular in the required form to each security holder whose proxy is solicited.
Standard of care for management of mutual fund
108.1.(1) Every person responsible for the management of a mutual fund, or occupying or performing similar functions, shall exercise the powers and discharge the duties of its office honestly, in good faith and in the best interests of the mutual fund, and shall exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in the circumstances.
(2) For the purposes of subsection (1), a person that is responsible for the management of a mutual fund includes a person that has a legal power or right to control the mutual fund or a person that, in fact, is able to do so.
Section 110.1
The provision will prohibit certain types of related party transactions between the mutual fund and its adviser and certain related parties. As a result of the removal of the ownership restrictions, banks and other financial institutions, banks and other financial institutions have become major players in the investment industry. Many of the parties involved in the operation of mutual funds (the trustee, manager, advisor, custodian, trading broker and distributor) are related. The provision will address concerns about conflicts of interest that arise in the context of the management of the investment portfolios of mutual funds sponsored by a financial institution.
Section 118 of the Ontario Securities Act prohibits a portfolio manager from knowingly directing the investment portfolio over which the manager has discretionary authority to purchase or sell securities of any issuer from or to the manager's account or the account of a related party to the portfolio manager. As the Ontario Securities Commission is currently reviewing related provisions, the Commission will consider any recommendations the OSC makes.
Section 112
Removes "manually" in order to implement the System for Electronic Document Analysis and Retrieval ("SEDAR").
Section 118
Clarifies that a purchaser is entitled to bring an action for damages or rescission where the dealer fails to provide the purchaser with an amendment to the prospectus. Together with the amendments to section 66, also clarifies that the purchaser is entitled to bring an action for damages or rescission where the prospectus or amendment was not filed.
Responsible Person
s. 110.1 [Drafting Instructions]
Section 110.1 will be similar to section 118 of the Ontario Securities Act. The provision will address conflicts of interest such as the portfolio manager permitting the investment portfolio over which the manager has discretionary authority to buy securities from the manager's personal account that may not be of a quality or at a price that is appropriate for the manager's client; the manager directing the investment portfolio to sell securities to the manager that may be of a quality or at a price that is not appropriate for the client. The provision will also prohibit the making of a loan by an investment portfolio to the
portfolio manager or a related party to the portfolio manager. Any necessary definitions will be set out in section 104(1).
Filing in other jurisdiction
112. Where the law of the jurisdiction in which the reporting issuer carries on business or is incorporated, organized or continued requires substantially the same reports in that jurisdiction as are required by this Part, the filing requirements of this Part may be complied with by filing the reports which are required by the law of the other jurisdiction and which are ^ signed or certified.
Right of action for failure to deliver documents
118. A person who is
(a) a purchaser of a security to whom a prospectus, and any amendment to that prospectus, was required under section 66 ^ to be sent but which prospectus, or amendment to that prospectus, was not sent, or
(b) a person to whom a take over bid circular, issuer bid circular, notice of change or notice of variation was required under Part 11 to be delivered but which circular or notice was not delivered,has a right to action for damages or rescission against the dealer or offeror who failed to comply with the applicable requirement.
Section 125.1
Strengthens the Commission's investigative powers by expanding the group of persons who must provide information or produce records at the request of the executive director.
Provision of information to executive director125.1 (1) The ^ executive director, by an order applicable generally or to one or more persons or entities named or otherwise described in the order, may require ^
(a) a clearing agency,
(b) a registrant,
(c) a reporting issuer,
(d) a manager or custodian of assets of a mutual fund, ^
(e) a custodian of securities issued by a mutual fund and held under a custodial agreement or other arrangement with a person engaged in the distribution of those securities,
(f) a general partner of a person referred to in paragraphs (b), (c) or (j),
(g) a person purporting to distribute securities in reliance on an exemption(i) described in section 55(2),
(ii) described in section 58(1)(a) where the security is described in section 32(j), or
(iii) in an order issued under section 59,(h) a transfer agent or registrar for securities of a reporting issuer,
(i) a director or officer of a reporting issuer,
(j) a promoter or control person of a reporting issuer, or
(k) the Canadian Investor Protection Fundto provide information or to produce records or classes of records specified or otherwise described in the order within the time or at the intervals specified in the order.
(2) The ^ executive director may require verification by affidavit of information provided or records or classes of records produced pursuant to an order under subsection (1).
Power of investigator
127. (1) An investigator appointed under section 126 or 131 may, with respect to the person who is the subject of the investigation, investigate, inquire into, inspect and examine
(a) the affairs of that person,
(b) any records, negotiations, transactions, investigations, investments, loans, borrowings and payments to, by, on behalf of, in relation to or connected with that person,
(c) any property, assets or things owned, acquired or disposed of in whole or in part by that person or by a person acting on behalf of or as agent for that person,
(d) the assets at any time held by, the liabilities, debts, undertakings and obligations at any time existing and the
Section 127
Amendment to subsection (2) is necessary to provide an effective means of gathering evidence for hearings before the Commission. Section 127 now requires the Commission to obtain an order from the Supreme Court before entering business or other non-residential premises. The amendment increases the speed and efficiency with which inspections can be conducted and recognizes the judicial distinction made between "unreasonable search and seizure" in the regulatory and criminal contexts. This procedure will be available only in respect of those persons who, by their actions, have brought themselves within the regulatory ambit of the Securities Act: persons named in an investigation order, persons named in section 125.1, and a self regulatory body or exchange recognized by the Commission under section 11.
The amendment in subsection (3) enables a person named by the Supreme Court to search a residence without the consent of the occupant. The current section 127(3), which requires the consent of the occupant, is of little practical use. It is highly unlikely that an occupant suspected of breaches of the Securities Act or Securities Regulation would consent to such a search. The requirement for a Supreme Court order balances residents' legitimate expectation of privacy with the Commission's need for sufficient tools to effectively enforce the Securities Act.financial or other conditions at any time prevailing in respect of that person, and
(i) investments made,
(ii) commissions promised, secured or paid,
(iii) interests held or acquired,
(iv) the lending or borrowing of money, securities or other property,
(v) the transfer, negotiation or holding of securities,
(vi) interlocking directorates,
(vii) common control,
(viii) undue influence or control, or
(ix) any other relationship.
(2) On being satisfied that it is necessary and in the public interest for any purpose relevant to the scope of an investigation ordered under section 126, the commission may authorize an investigator appointed under section 126
(b) to require the production of any records, property, assets or things and to inspect, examine or analyze them, and
(c) on giving a receipt, to remove any records, property, assets or things inspected, examined or analyzed under paragraph (a) for the purpose of further inspection, examination or analysis.
(3) On application by the commission and on being satisfied by information on oath that there are reasonable and probable grounds to believe that there may be,
(b) in a business premise other than described in subsection (2)(a), or
(c) in a building, receptacle or place, other than referred to in subsection (2) or paragraph (a) or (b), of any person,
Section 127(4)-(5)
Amendment to subsection (4) uses plain language to replace Latin expressions so that the people to whom this section applies can better understand their rights. Subsections (4) and (5) have been combined so subsection (5) may be repealed.
anything that may reasonably relate to an investigation ordered by the commission under section 126 into an alleged violation of this Act or the regulations, the Supreme Court may make an order authorizing a person named in the order
(e) to require the production of any records, property, assets or things and to inspect, examine or analyze them, and
(f) on giving a receipt, to remove any records, property, assets or things inspected, examined or analyzed under paragraph (d) for the purpose of further inspection, examination or analysis.
(4) An application for an order under subsection ^ (3) shall be made in the prescribed manner and ^ may be
(b) heard in the absence of the public
unless the Supreme Court otherwise directs.
(5) Repealed.
(6) Inspection, examination or analysis under this section shall be completed as soon as practical and the records, property, assets or things shall be ^ immediately returned to the person who produced them.
(7) On an inspection, examination or analysis under this section, an investigator appointed under section 126 and authorized under subsection (2) or (3) or a person acting under his or her direction may
(b) use or alter the records, property, assets or things to the extent reasonably necessary to facilitate the inspection, examination or analysis,
and does not incur any liability because of doing so.
(8) No person shall withhold, destroy, conceal or refuse to give any information or produce any record or thing reasonably required under this section by the investigator or person named in an order under subsection (2).
Section 130
Eliminates administrative burden on Compliance and Enforcement staff to prepare unnecessary reports and allows staff to devote more resources to actual investigations of violations of the Securities Act. Makes the report privileged to protect the confidentiality of investigations.
Section 144(1)(b) and (d)-(e)
Provides new administrative remedy to address abusive practices in connection with the purchase of securities.
Enables the Commission or executive director to prohibit a person from engaging in investor relations activities, which are a common source of abuse in the local securities market.
Enables the Commission or executive director to prohibit a person engaged in investor relations activities from disseminating information to the public and to require the person to disseminate information or amend information being disseminated.
Report to commission
130.(1) Every person appointed under section 126 or 129 shall, at the request of the commission or a member of the commission involved in making the appointment, provide the commission or the member with a complete report of the investigation or examination made including any transcript of evidence and material in his or her possession relating to the investigation or examination.
(2) A report provided under this section is privileged.
Enforcement orders
144. (1) Where the commission or the ^ executive director considers it to be in the public interest, the commission or the ^ executive director, after a hearing, may order ...
(b) that(i) all persons,
(ii) the person or persons named in the order, or
(iii) one or more classes of personscease trading in, or be prohibited from purchasing, a specified security or exchange contract or class of security or a class of exchange contract,
...(d) that a person
(i) resign any position that the person holds as a director or officer of an issuer, ^
(ii) is prohibited from becoming or acting as a director or officer of any issuer, or
(iii) is prohibited from engaging in investor relations activities(e) that a registrant, ^ issuer or person engaged in investor relations activities,
(i) is prohibited from disseminating to the public, or authorizing the dissemination to the public, of any information or record of any kind that is described in the order,
(ii) is required to disseminate to the public, by the method described in the order, any information or record relating to the affairs of the registrant or issuer that the commission or the ^ executive director considers must be disseminated, or
Section 144(f)
Broadens the restrictions that may be imposed, after a hearing, by the executive director or the Commission. This facilitates greater control over, for example, the sale of "exempt" securities by salespersons of mutual fund dealers. Complementary authority is proposed for section 22(1) of the Act.
Section 151(1.1)
Subsection (1.1) is necessary to implement System for Electronic Document Analysis and Retrieval ("SEDAR").
Section 151(4)
Clarifies that one purpose for which the Commission collects personal information from registrants and directors, officers, promoters and control persons is to make certain classes of the information available to the public.
(iii) is required to amend, in the manner specified in the order, any information or record of any kind described in the order before disseminating the information or record to the public or authorizing its dissemination to the public, or
(f) that a registrant be reprimanded, ^ that a person's registration be suspended, cancelled or restricted ^ or that conditions be imposed on a registrant.
Filing and inspection of records
151. (1) Unless otherwise indicated, records required by this Act or by the regulations to be filed shall be filed by depositing them with the commission.
(1.1) Subject to the regulations, records required by this Act or by the regulations to be filed may be filed electronically in any form specified by the executive director.
(2) All records filed under this Act or the regulations shall, subject to subsection (3), be made available for public inspection during normal business hours.
(3) The commission may hold in confidence a record or any class of record required to be filed under this Act or the regulations so long as it considers that(a) the record or class of record discloses intimate financial, personal or other information, and
(b) the desirability of avoiding disclosure of the information, in the interests of any person affected, outweighs the desirability of adhering to the principle of public disclosure.(4) Notwithstanding the Freedom of Information and Protection of Privacy Act, one of the purposes for collecting personal information from applicants for registration under section 20(2) and from directors, officers, promoters and control persons under section 73.1 is to make certain classes of that information available for public inspection during normal business hours.
Section 154.5
Provides the Commission with the ability to ensure order in proceedings before it. Makes the powers of the Commission uniform with those of the Ontario Securities Commission.
Section 155.1
Permits a person that is assessed such fees and charges to request a "taxation" (review) of the costs. Subsection (1) is modelled after s. 143(3) of the Act.
Section 156(1)
Amendment in subsection (1) addresses situation in which the Securities Act does not require a record to be sent but contemplates the sending of a record. For example, under section 66(3) in order for a purchaser not to be bound by an agreement with a dealer to purchase a security, the Act contemplates that the purchaser must send the dealer written notice within a specified period of time. The amendment therefore enables the purchaser to send that notice using one of the three alternatives set out in section 156(1)(a) - (c), and indirectly makes section 66(3) more uniform with the comparable provision in the Ontario Securities Act, section 71(2), which provides that the notice may be "written or telegraphic". The amendment in subsection (c) is necessary to implement SEDAR since records transmitted via SEDAR will not always be printed by the recipient.
Contempt
154.5 [Drafting instructions]
Ensure the commission has the ability to apply to the Supreme Court for an order that a person who has acted contemptuously in appearing before the commission is in contempt of the commission as if that person were in contempt of the Supreme Court.
Taxation of fees and charges
155.1 (1) Where a person is ordered to pay prescribed fees or charges for the cost of, or related to,
(a) an examination or investigation by a person appointed under section 9 or 137 of the Act,
(b) a compliance review under section 15.1 or 24.1 of the Act,
(c) an investigation made under Part 15, or
(d) a hearing required or permitted under this Act or the regulations,the person ordered to pay the fees or charges may, within 30 days of the date of the order, apply to a master or registrar of a court to review the order as if the order were a bill of costs, and on the review the master or registrar shall review the fees and charges and may vary them if the master or registrar considers that they are unreasonable or not related to the examination, investigation, review or hearing.
(2) A person that applies for a review under subsection (1) shall, at the same time, notify the person that made the order.
Notices generally
156. (1) Unless otherwise provided by this Act or ordered by the commission or ^ executive director, a record sent or required to be sent under this Act or the regulations shall be
(a) personally delivered,
(b) mailed, or
(c) transmitted by electronic means ^,to the person to whom the record is required to be sent.
Section 159(1)(6) and (1)(10)
Housekeeping amendment to paragraph (i.1). Paragraph (iv) clarifies that the Lieutenant Governor in Council has authority to make regulations concerning "fair dealing".
Conforms to wording in sections 31(2)(4) and 55(2)(3) of the Securities Act, s. 75 of the Securities Regulation and Local Policy Statement 3-15 on exempt purchaser status.
Regulations
159. (1) The Lieutenant Governor in Council may make regulations ^ for the purpose of regulating trading in securities or exchange contracts, or regulating the securities industry or exchange contracts industry, including regulations ...
(6) respecting registration under this Act including, but not limited to, prescribing
(i) categories for persons for purposes of registration and otherwise,
(i.1) the duration of registration, and permitting the commission to determine the duration of registration and to determine different periods ^ of registration for different categories of registrants,
(ii) the manner of allocating persons to categories, and permitting the ^ executive director to make these allocations, ^
(iii) conditions to be met by persons in the^ categories referred to in subparagraph (ii), and
(iv) standards of conduct to be met, and practices to be carried out, by registrants, ...(10) prescribing the practice and procedure by which the ^ executive director designates exempt purchasers under sections 31 and 55,
Company Act
1(1)(c)(iii), 1(1), 18(1)(1.1), 18(1)(1.3), 97(2), 138(1)(f)(i), 138(1)(f)(iii), 203(3)(b), 233(6), 250(2), 256(1)(c), 355
Replace "superintendent" with "executive director".
Partnership Act
48, 58(2), 66(7)
Replace "superintendent" with "executive director".
Securities Amendment Act, 1990
1(i), 8(b), 10, 14, 15, 16, 18(a), 19(b), 25, 32(c), 47(b), and 50(a)
Repealed.
27 and 43
Replace "superintendent" with "executive director".
Securities Amendment Act, 1992
6, 7, 11, 26(b)
Replace "superintendent" with "executive director".
Securities Regulation
1, 4(8), 4(8)(c)(ii), 6(1)(b), 10(1)-(2), 16, 16.1(3), 17(1), 18(section heading), 18(1)-(2), 23, 24, 29(2), 57, 63, 66(2)-(3), 72(1)(a)-(b), 72.3(1)-(3), 72.3(3)(b), 72.4, 73(b)-(c), 74(b)-(c), 75(2), 86(2), 87(1)-(2), 88, 90(1), 90(3), 94(1)-(2), 95(1)-(2), 101, 102, 106(1), 106(1)(b)(ii), 106(2), 106(2)(b), 106(3)(b), 106(3), 106(5), 108(3), 110, 111, 113(3)(b), 113(4), 114(1), 114(3), 115(4)(c), 115(6), 121(c)-(d), 123(3), 124, 134(6)(b)(i), 152.2, 153(3), 153(7), 163.6, 167.2(section heading), 167.2(1), 167.2(1)(a)-(b), 167.2(2), 167.10(2)-(4), 167.10(4)(b), 167.12, 171.2, 180(1)-(2), 180(4)(a), 180(5), 181, 183(1), 183(1)(20)-(21), 183(1)(23)(a)(iii), 183(1)(23)(b)(iii), 183(1)(23.1)(c), 183(1)(33)(b)-(c),183(2), 183(5), 186(i), 186(m)-(n), 187(1)-(2), 190.
Replace "superintendent" with "executive director".