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ONTARIO SECURITIES COMMISSION
RULES OF PRACTICE

Made under the Statutory Powers Procedure Act




Rule 1 - General


(Cross-reference: See also the Statutory Powers Procedure Act)

1.1 Application of Rules Unless otherwise stated in these Rules, these Rules apply to all proceedings before the Commission where the Commission is required under the Securities Act or the Commodity Futures Act or otherwise by law to hold a hearing or to afford to the parties to the proceeding an opportunity for a hearing before making a decision.

 

1.2 General (1) General Powers of the Commission under these Rules The Commission may exercise any of its powers under these Rules on its own initiative or at the request of a party.

(2) The Commission may issue general or specific procedural directions at any time, including before or during any proceeding.

(3) The Commission may waive or vary any of these Rules in respect of any proceeding if it is of the opinion that to do so would be in the public interest or would otherwise be advisable to secure the just and expeditious determination of the matters in issue.

(4)General Principle These Rules shall be construed to secure the most expeditious and least expensive determination of every proceeding before the Commission on its merits, consistent, however, with the requirements of justice.

(5) Effect of Irregularity in Form – No proceeding or step, document or order in a proceeding is invalid by reason only of a defect or other irregularity in form.

(6) Party Includes Staff – In these Rules a reference to a “party”, includes staff of the Commission if the context so requires.

 

1.3 Service and Filing (1) Filing – A document required under these Rules to be filed shall be filed by either personally delivering a copy of the document to the offices of the Commission, marked to the attention of the Secretary, or, alternatively, by sending a copy of the document by mail, courier or telephone transmission to the Secretary to the Commission.

(2) Unless otherwise specified in these Rules or otherwise directed by the Commission or the Secretary to the Commission, when a document is filed otherwise than by telephone transmission, 4 copies shall be filed.

(3) Service A document required under these Rules to be served may be served by any means effective to deliver the document or a copy thereof to the person being served or to that person’s counsel of record.

(4) Service or Filing After 4:30 p.m. – Documents served or filed after 4:30 p.m. shall be deemed to have been served or filed, as the case may be, on the next day that is not a holiday.

(5) Lengthy Telephone Transmissions Documents served or filed by telephone transmission shall not exceed 16 pages, inclusive of the cover sheet, except with the consent of the receiving party in the case of serving a document, or of the Secretary to the Commission in the case of filing a document.

(6) Information on Documents Served or Filed A party who serves or files a document shall include with it the following information:

(a) the party’s name, address, telephone number and fax number (if any);

(b) the name of the proceeding to which the document relates;

(c) if the party has counsel or an agent, the name, address, telephone number and fax number (if any) of the counsel or agent; and

(d) in the case of serving a document, the name of the party or solicitor or agent to be served.

 

1.4 Appearance and Representation Before Commission

(1) In any proceeding before the Commission a party may appear on his or her own behalf or may be represented by counsel or an agent.

(2) Representing Oneself When an individual first appears on his or her own behalf before the Commission in a proceeding, the individual shall file or otherwise state on the record, and keep current during the proceeding, his or her address, telephone number and fax number, if any.

(3) Representation by Counsel or Agent When a person first appears as counsel or agent for a party in a proceeding before the Commission, the person shall file or otherwise state on the record, and keep current during the proceeding, the person’s address, telephone number and fax number, if any, and the name and address of the party being represented.

(4) Change in Representation by Party A party who is represented by counsel or an agent may change the counsel or agent by serving on the counsel or agent and on every other party and filing a notice of the change and giving the name, address, telephone number and fax number, if any, of the new counsel or agent.

(5) A party acting in person may appoint counsel or an agent by serving on every other party and filing a notice of the appointment and giving the name, address, telephone number and fax number, if any, of the counsel or agent.

(6) A party who is represented by counsel or an agent may elect to act in person by serving on the counsel or agent and on every other party and filing a notice of the intention to act in person and giving the party’s address, telephone number and fax number, if any.

(7) Withdrawal by Counsel or Agent Counsel or an agent for a party in a proceeding may withdraw as counsel or agent for the party only with leave of the Commission.

(8) Notice of the motion seeking leave to withdraw as counsel or agent must be served on the party and state all facts material to a determination of the motion including, without disclosing any solicitor client communication in which solicitor client privilege has not been waived, a statement of the reasons why leave should be given.

 

 

1.5 Time – (1) Computation – In the computation of time under these Rules, except where a contrary intention appears,

(a) if there is a reference to a number of days between two events, they are counted by excluding the day on which the first event happens and including the day on which the second event happens, even if they are described as clear days or the words “at least” are used;

(b) if a period of less than 7 days is prescribed, holidays are not counted; and

(c) if the time for doing an act under these Rules expires on a holiday, the act may be done on the next day that is not a holiday.

 

(2) In these rules, “holiday” means,

(a) any Saturday or Sunday,

(b) New Year’s Day,

(c) Good Friday,

(d) Easter Monday,

(e) Victoria Day,

(f) Canada Day,

(g) Toronto’s Civic Holiday,

(h) Labour Day,

(i) Thanksgiving Day,

(j) Remembrance Day,

(k) Christmas Day,

(l) Boxing Day, and

(m) any special holiday proclaimed by the Governor General or the Lieutenant Governor,

and where New Year’s Day, Canada Day or Remembrance Day falls on a Saturday or Sunday, the following Monday is a holiday, where Christmas Day falls on a Saturday or Sunday, the following Monday and Tuesday are holidays and, where Christmas Day falls on a Friday, the following Monday is a holiday.

(3)Extension or Abridgement The Commission may, before or after expiration of a prescribed time period and on such conditions, if any, as it considers advisable, extend or abridge any time prescribed under these Rules.

(4) Any time period prescribed by these Rules may be extended or abridged upon the consent of all parties to the proceeding, without any direction from the Commission.

 


PRACTICE GUIDELINES – GENERAL

1. The Commission may hold a hearing, such as a hearing relating to a take-over bid, on an expedited basis. An expedited hearing is typically held on short notice and the parties typically agree on the procedure to be followed. The Commission will be prepared to waive or vary requirements in the Rules of Practice, including abridging time periods, in order to allow for an efficient hearing of the matter.




Rule 2 - Pre-Hearing Conferences

(Cross-reference: See also section 5.3 of the Statutory Powers Procedure Act)

 

2.1 Directing Pre-hearing Conference(1) The Commission may direct the parties to a proceeding to participate in a pre-hearing conference at any stage of a proceeding either upon its own initiative or at the request of a party.

 

(2) Except where the emergency nature of a proceeding would make a pre-hearing conference inappropriate or where the Commission otherwise directs, at least one pre-hearing conference shall be held before the commencement of a hearing.

 

2.2 Issues at Pre-hearing Conference At a pre-hearing conference consideration may be given to any issue that in the view of the Commissioner presiding at the pre-hearing conference may assist in the just and most expeditious disposition of the proceeding, which may include,

 

(a) simplification or clarification of the issues in the proceeding;

 

(b) disclosure of documents;

 

(c) facts or evidence that may be agreed upon;

 

(d) identifying any issues as to admissibility of evidence;

 

(e) amendments to the notice of hearing or a response;

 

(f) identifying any preliminary objections;

 

(g) scheduling any preliminary motions and the hearing;

 

(h) the date by which any steps in the proceeding are to be taken or begun; and

 

(i) settlement of any or all the issues in the proceeding.

 

 

2.3 Notice(1) The Secretary to the Commission shall give notice of any pre-hearing conference to the parties and to such other persons as the Commission directs be given notice.

 

(2) The notice shall include,

 

(a) the date, time, place and purpose of the pre-hearing conference;

(b) whether parties are required to exchange or file documents or pre-hearing submissions as prescribed by Subrule 2.4 and, if so, the issues to be addressed and the date or dates on or before which the documents or pre-hearing submissions must be exchanged and filed;

(c) whether parties are required to attend in person and,

(i) if so, that they may be accompanied by counsel or an agent; and

(ii) if not, that they may be represented by counsel or an agent who has the authority to make agreements and undertakings on their behalf respecting the matters to be addressed at the pre-hearing conference;

 

(d) a statement that if a party does not attend (in person or by counsel or an agent, as required) at the pre-hearing conference, the Commissioner may proceed in the absence of that party; and

 

(e) a statement that orders, which will be binding on all parties with respect to the conduct of the proceeding, may be made by the Commissioner presiding at the pre-hearing conference.

 

 

2.4 Exchange of Documents The Commissioner selected to preside at the pre-hearing conference may,

 

(a) direct that the parties are required, by a specific date or dates, to exchange and to file copies of, documents or pre-hearing submissions; and

 

(b) prescribe the issues to be addressed in the pre-hearing submissions and at the pre-hearing conference.

 

 

2.5 Oral or Electronic A pre-hearing conference may be held in person or electronically, as the Commissioner selected to preside at the pre-hearing conference may direct.

 

 

2.6 Inaccessible to Public – (1) A pre-hearing conference shall be held in the absence of the public.

(2) Any pre-hearing submissions referred to in Subrule 2.4 shall not be made available to the public.

 

2.7 Orders, Agreements, Undertakings – (1) The Commissioner presiding at a pre-hearing conference may, after giving the parties an opportunity to make submissions, make such orders with respect to the conduct of the proceeding as he or she sees fit, which orders shall be binding on all parties to the proceeding.

 

(2) All agreements, undertakings and orders made or given at a pre-hearing conference shall be recorded in a memorandum prepared under the direction of the pre-hearing Commissioner and circulated in draft to the parties or their counsel for corrections, if any, and then signed by the pre-hearing Commissioner.

 

(3) Every memorandum recording agreements, undertakings and orders made at a pre-hearing conference shall be filed with the Commission and shall be available to the Commissioners hearing the matter on the merits.

 

(4) Orders, agreements and undertakings made at the pre-hearing conference govern the conduct of the proceeding and are binding upon the parties to the proceeding unless otherwise ordered by the Commission.

 

 

2.8 No Communication to Hearing Panel – No Communication shall be made to the Commission panel subsequently hearing the matter on the merits of any statement made at a pre-hearing conference or in a pre-hearing submission referred to in Subrule 2.4, except as disclosed in an order made under Paragraph 2.7(1) and the memorandum made under Paragraph 2.7(2).


Rule 3 - Disclosure

(Cross-reference: See also sections 5.4 and 8 of the Statutory Powers Procedure Act and Part VI of the Securities Act)

3.1Interpretation – (1) In this Rule 3, “document” includes a sound recording, video-tape, film, photograph, chart, graph, map, plan, survey, book of account, and information recorded or stored by means of any device.

(2) Particulars shall include,

(a) the grounds upon which any remedy or order is being sought or opposed in the proceeding; and

(b) a general statement of the material alleged facts that the party relies on in support of the position being taken by the party in the proceeding.

 

3.2 Disclosure Order At any stage in a proceeding, the Commission may order,

(a) that a party provide to another party and to the Commission such particulars as the Commission considers necessary for a full and satisfactory understanding of the subject of the proceeding; and

(b) that any other disclosure required by this Rule 3 be made by a party, within such time and on such conditions as may be specified by the Commission.

 

3.3 Disclosure of Documents or Things(1) Requirement to Disclose Each party to a proceeding shall, as soon as is reasonably practicable after service of the notice of hearing, and in any case, at least 10 days before the commencement of the hearing, deliver to every other party copies of all documents that the party intends to produce or enter as evidence at the hearing.

(2) In the case of a hearing under section 127 of the Securities Act and subject to Subrule 3.7, staff of the Commission shall, as soon as is reasonably practicable after service of the notice of hearing, and in any case at least 10 days before the commencement of the hearing, make available for inspection by every other party all other documents and things which are in the possession or control of staff that are relevant to the hearing and provide copies, or permit the inspecting party to make copies, of the documents at the inspecting party’s expense.

(3) Failure to Disclose Document or Thing – A party that fails to make disclosure of a document or thing in compliance with Paragraph 3.3(1) may not refer to the document or thing or introduce it in evidence at the hearing without leave of the Commission, which may be on such conditions as the Commission considers just.

 

3.4 Disclosure Where Section 8 of the Statutory Powers Procedure Act Applies Subject to Subrule 3.7, if the good character, propriety of conduct or competence of a party is an issue in a proceeding, the party making the allegations shall, as soon as is reasonably practicable after service of the notice of hearing, and in any case at least 10 days before the commencement of the hearing, provide particulars of the allegations and disclose to the party against whom the allegations are made all documents and things in the party’s possession or control relevant to the allegations including,

(a) all signed witness statements, or if these do not exist, transcripts or notes of witness interviews or, if none of the foregoing exist, statements of evidence that each witness is expected to give; and

(b) all experts’ reports.

 

3.5 Witness Lists and Statements – (1) Provision of Witness List – A party to a proceeding shall, at least 10 days before the commencement of the hearing, provide to every other party and to the Secretary to the Commission a list of the witnesses the party intends to call to testify on the party’s behalf at the hearing.

(2) Provision of Witness Statements – A party to a proceeding shall, at least 10 days before a witness is to testify on the party’s behalf at the hearing, provide to every other party a witness statement signed by the witness, or for any witness where such a statement does not exist, a statement of the evidence that the witness is expected to give at the hearing.

(3) Content of Witness Statements – A witness statement or statement of evidence that the witness is expected to give shall contain,

(a) the substance of the evidence of the witness;

(b) reference to the documents, if any, to which the witness will refer; and

(c) the witness’ name and address or, if the witness’ address is not provided, the name and address of a person through whom the witness can be contacted.

(4) Failure to Provide Witness List or Statement – A party who fails to include a witness in the witness list or provide a witness statement or a statement of the evidence a witness is expected to give in accordance with Paragraphs 3.5(1), (2) and (3) may not call the person as a witness without leave of the Commission, which may be on such conditions as the Commission considers just.

(5) Incomplete Witness Statement A witness may not testify to material matters that were not disclosed in the witness statement or statement of evidence without leave of the Commission, which may be on such conditions as the Commission considers just.

 

3.6 Expert Witness – (1) Notice of Intent to Call Expert A party who intends to call an expert to give evidence at a hearing shall, at least 30 days before the commencement of the hearing, inform the other parties of the intent to call the expert and the issue on which the expert will be giving evidence.

(2) Provision of Expert’s Report – A party who intends to file a report by an expert at a hearing shall, at least 15 days before the report is filed at the hearing, provide to every other party a copy of the report signed by the expert containing,

(a) the name, address and qualifications of the expert;

(b) the substance of the expert’s evidence; and

(c) a list of the documents, if any, to which the expert will refer.

(3) Failure to Advise of Intent to Call Expert A party who fails to comply with Paragraph 3.6(1), may not call the expert as a witness without leave of the Commission, which may be on such conditions as the Commission considers just.

(4) Failure to Provide Expert’s Report A party who fails to comply with Paragraph 3.6(2), may not file the expert’s report without leave of the Commission, which may be on such conditions as the Commission considers just.

 

3.7 Part VI of the Securities ActDespite any provision in this Rule 3, no disclosure is required to be made under this Rule 3 (i) which would contravene section 16 of the Securities Act or (ii) of a fact or matter which would not be admissible in evidence at a hearing by reason of subsections 15(2) or (3) of the Statutory Powers Procedure Act.

 


Rule 4 - Electronic Hearings

(Cross-reference: See also sections 5.2, 6(5) and 9(1.2) of the Statutory Powers Procedure Act)

4.1 Application This Rule 4 does not apply to the admissibility, at an oral hearing, of electronic evidence admissible under section 1 of the Statutory Powers Procedure Act.

 

4.2 When to Hold Electronic Hearing(1) The Commission may, subject to section 5.2 of the Statutory Powers Procedure Act, conduct at any time a proceeding or part of a proceeding by means of an electronic hearing.

(2) The Commission may conduct an electronic hearing to deal with procedural matters and in such a case Subrules 4.4 and 4.5 do not apply.

 

4.3 Converting From or to Electronic Hearing(1) The Commission may, (a) continue an electronic hearing as an oral hearing; (b) subject to section 5.1 of the Statutory Powers Procedure Act, continue an electronic hearing as a written hearing; or (c) subject to section 5.2 of the Statutory Powers Procedure Act, continue an oral hearing as an electronic hearing.

(2) If the Commission decides to convert an electronic hearing into an oral or written hearing, it shall notify the parties of its decision and may supply directions as to the holding of that hearing, and any procedures set down in these Rules for such a hearing apply.

 

4.4 Objections to Electronic Hearing(1) Notice of Objection A party who objects to a hearing being held as an electronic hearing, other than a hearing to deal only with procedural matters, shall file and serve on all other parties a written notice of objection within 5 days after receiving notice of the electronic hearing.

(2) Contents of Notice of Objection In a notice of objection, the objecting party shall,

(a) state whether holding the hearing as an electronic hearing is likely to cause the party significant prejudice;

(b) set out reasons for the objection; and

(c) state all facts upon which the party relies and provide the evidence on which the party relies in relation to the objection.

 

4.5 Procedure When Objection Made If the Commission receives a notice of objection, it may,

(a) accept the objection, cancel the electronic hearing and either schedule an oral hearing or, with consent of the parties, schedule a written hearing;

(b) reject the objection if satisfied that the electronic hearing is not likely to cause significant prejudice to the objecting party, inform every other party that they are not required to respond to the notice of objection and proceed with the electronic hearing; or

(c) notify all other parties that they may respond to the notice of objection by serving on every other party and filing a written response in such form and within such time as is directed by the Commission and, after considering the objection and all responses, proceed with the electronic hearing if satisfied that the electronic hearing is not likely to cause significant prejudice to the objecting party, schedule on oral hearing, or, with consent of the parties, schedule a written hearing.

 

 

4.6 Conditions – The Commission may, in deciding that a hearing will be held electronically, impose conditions including specifying the party responsible for making the necessary arrangements for the electronic hearing and requiring that a party requesting an electronic hearing pay all or part of the cost of providing the facilities necessary for the conduct of the hearing electronically.

 


PRACTICE GUIDELINES – ELECTRONIC HEARINGS

1. Factors in Whether to Hold Electronic Hearing In deciding whether to hold an electronic hearing, the Commission may take into account any factors it considers relevant, which may include:

(a) the suitability of the electronic technology for the subject matter of the hearing;

(b) whether the nature of the evidence is appropriate for an electronic hearing, including whether credibility is in issue and the extent to which facts are in dispute;

(c) the extent to which the matters in dispute are questions of law;

(d) the convenience of the parties;

(e) the cost, efficiency and timeliness of proceedings;

(f) avoidance of unnecessary length or delay;

(g) ensuring a fair and understandable process;

(h) the desirability or necessity of public participation or public access to the Commission’s process; and

(i) any other consideration affecting the fulfilment of the Commission’s statutory mandate.

2. Public Access ­ The Commission will provide for public access to electronic hearings in circumstances where, in the Commission’s view, it is in the public interest and reasonable to do so, subject to section 9(1) of the Statutory Powers Procedure Act.

 


Rule 5 - Written Hearings

(Cross-reference: See also sections 5.1(1), 6(4), 7(2) and 9(1.1) of the Statutory Powers Procedure Act)

5.1 Application(1) This Rule does not apply to the admissibility, at an oral or electronic hearing, of written evidence admissible under section 15 of the Statutory Powers Procedure Act.

(2) Nothing in this Rule 5 precludes the Commission from directing that written submissions be filed in respect of a matter arising in a hearing, and, if the Commission so directs, the parties may also be given an opportunity to make oral submissions on the matter, which oral submissions may be time limited by the Commission.

5.2 Filing Where this Rule 5 requires that documentation be filed, 5 copies shall be filed, except in the case of a notice of an objection to a written hearing which shall be filed in duplicate.

 

5.3 Definition of Applicant In this Rule 5, “applicant” means the party who instituted the proceeding or the party who is bringing a motion, as appropriate.

 

5.4 When to Hold Written Hearing(1) The Commission may conduct any proceeding or part of a proceeding by means of a written hearing, subject to subsection 5.1(2) of the Statutory Powers Procedure Act.

(2) Written hearings shall be held in the following circumstances unless a party objects or the Commission directs otherwise:

(a) motions relating to procedural issues;

(b) motions to determine issues of law, including questions under the Canadian Charter of Rights and Freedoms;

(c) hearings on agreed facts;

(d) hearings and reviews on the record of decisions of the Director or of a recognized stock exchange, recognized self-regulatory organization or recognized clearing agency; and

(e) reviews of Commission decisions under Rule 9.

 

5.5 Converting From or to Written Hearing– (3) The Commission may,

(a) continue a written hearing as an oral hearing;

(b) subject to subsection 5.2(2) of the Statutory Powers Procedure Act, continue a written hearing as an electronic hearing; or

(c) subject to subsection 5.1(2) of the Statutory Powers Procedure Act, continue an oral hearing as a written hearing.

(4) If the Commission decides to convert a written hearing into an oral or electronic hearing, it shall notify the parties of its decision and may supply directions as to the holding of that hearing and any procedures set down in these Rules for such a hearing apply.

 

5.6 Objections to Written Hearing(1) A party who objects to a hearing being held as a written hearing shall file and serve a notice of objection within 5 days after receiving notice of the written hearing.

(2) If a party objects to a written hearing, the Commission shall notify the parties of the objection and provide a notice of an oral or electronic hearing.

 

5.7 Submissions and Supporting Documents(1) The applicant shall, within 7 days after receiving notice of the written hearing, file and serve on all other parties its written submissions setting out,

(a) the grounds upon which the request for the remedy or order is made;

(b) a statement of the facts relied on in support of the remedy or order requested;

(c) the evidence relied on in support of the remedy or order requested; and

(d) any law relied on in support of the remedy or order requested.

(2) The Commission may require the applicant to provide further information, and this information shall be supplied to every other party.

 

5.8 Response(1) If a party wishes to respond, the party shall do so by serving on every other party and filing a written response within 5 days after the applicant’s submissions and supporting documents are served on the party.

(2) The response shall set out the party’s submissions relating to the matter before the Commission and be accompanied by a statement of the facts and any evidence and any law relied on in support of the response.

 

5.9 Reply – (1) The applicant may reply to a response by serving on every other party and filing a written reply within 5 days after a response from a party is served on the applicant.

(2) The reply shall set out the position of the applicant to the response and be accompanied by any additional facts, evidence and law that the applicant relies on in support of the reply.

 

5.10 Evidence(1) The evidence shall be in writing, or when electronic transmission is permitted, it shall be in the form directed by the Commission.

(2) The evidence shall identify the person giving the evidence and be either in certified or affidavit form or in such other form as may be acceptable to the Commission.

 

5.11 Oral Examination(1) In a written hearing, there shall be no oral examination unless ordered by the Commission.

(2) If a party requests, the Commission may order that a party present a witness to be examined or cross-examined upon such conditions as the Commission directs.

 


PRACTICE GUIDELINES – WRITTEN HEARINGS

1. Factors in Whether to Hold Written Hearing – In deciding whether to hold a written hearing, the Commission may take into account any factors it considers relevant, which may include,

(a) the suitability of a written hearing format considering the subject matter of the hearing, including the extent to which matters are in dispute;

(b) whether the nature of the evidence is appropriate for a written hearing, including whether credibility is an issue and the extent to which the facts are in dispute;

(c) the extent to which the matters in dispute are questions of law;

(d) the convenience of the parties;

(e) the cost, efficiency and timeliness of proceedings;

(f) avoidance of unnecessary length or delay;

(g) ensuring a fair and understandable process;

(h) the desirability or necessity of public participation or public access to the Commission’s process; and

(i) any other consideration affecting the fulfilment of the Commission’s statutory mandate .


Rule 6 - Motions

6.1 Notice – (1) Except as provided in Paragraph (3), a party who intends to bring a motion before the Commission shall serve on every other part and file written notice of the motion at least 5 days before the day the motion is to be heard.

(2) The notice of the motion shall set out the relief sought, the grounds for the motion and the evidence to be relied upon.

(3) Written notice of a constitutional question in respect of which section 109 of the Courts of Justice Act is applicable shall be served on every other party and filed at the same time as the notice required by that section is served.

 

6.2 Hearing Date for Motion Except when a motion is to be argued on a scheduled hearing date or is to be argued in writing, the party bringing the motion shall, before serving the notice, obtain an appointment from the Secretary to the Commission for the hearing of the motion.

 

6.3 Where No Notice Required The Commission may permit a party to bring a motion without notice if,

(a) the nature of the motion or the circumstances render service of a notice of motion impractical or unnecessary; or

(b) the delay necessary to effect service might entail serious consequences.

 

6.4 Filing Motion Materials(1) The Commission may set time frames for filing factums and other materials relating to a motion.

(2) If the party bringing a motion fails to comply with the time frames set out in these Rules or to comply with the time frames directed by the Commission for filing of motion materials, the Commission may refuse to hear the motion.

 


Rule 7 - Reviews of Decisions of the Director, a Stock Exchange, a Self-regulatory Organization of a Clearing Agency

(Cross reference: See also sections 8 and 21.7 of the Securities Act)

7.1 Application In this Rule 7, “decision” means any direction, decision, order, ruling or other requirement made by a Director, stock exchange, self-regulatory organization or clearing agency.

7.2 Request for Hearing and Review(1) A request for a hearing and review of a decision shall,

(a) identify the decision in respect of which the hearing and review is being sought;

(b) state the interest in the decision of the party filing the request;

(c) state in summary form the alleged errors in the decision and the reasons for requesting the hearing and review; and

(d) state the desired outcome.

(2) A request for a hearing and review of a decision shall be served by the requester on every other party to the original proceeding and filed.

 

7.3 Record(1) The party requesting a hearing and review of a decision shall obtain from the Director, stock exchange, self-regulatory organization or clearing agency, as the case may be, and file a record of the subject proceeding which shall include,

(a) the application or other document, if any, by which the proceeding was commenced;

(b) the notice of any hearing;

(c) any intermediate orders made in the proceeding;

(d) any documentary evidence filed in the proceeding, subject to any limitation expressly imposed by any statute, regulations or rules on the extent to which or the purpose for which any such documents may be used in any proceeding;

(e) the transcript, if any, of the oral evidence given at the hearing; and

(f) the decision that is subject to hearing and review and the reasons therefor, if reasons were given,

unless all parties consent to the omission of any of those documents from the record or the Commission otherwise directs.

(2) The party requesting a hearing and review shall provide a copy of the record of the proceeding to any other party that requests a copy of the record.

 

7.4 New Evidence If a party proposes to introduce new evidence at the hearing and review, that party shall, at least 10 days before the hearing and review, advise every other party as to the substance of the new evidence and shall deliver to every other party copies of all new documents that the party will rely on at the hearing and review.

 

7.5 Order Dispensing with Transcripts If the Commission is of the opinion that a transcript of the oral evidence taken at the original hearing is unnecessary to effectively deal with the hearing and review, or if for some other reason it is considered appropriate by the Commission, the Commission may direct that a transcript of the oral evidence be dispensed with.

 

7.6 Stay of Decision(1) The party requesting the hearing and review may apply to the Commission prior to the hearing and review for an order staying the original decision until the hearing and review is concluded.

(2) Such an application shall be made in writing and shall state the reasons why a stay is required.

 

7.7 Setting Down for Hearing Upon the record of the proceedings being filed, the Secretary of the Commission shall give notice of the time and place for the hearing and review.

 

7.8 Statement of Fact and Law in Oral Hearing(1) The party requesting a hearing and review shall, if an oral hearing is to be held, serve on every other party and file a statement of the points to be argued and of the facts and law being relied upon at least 10 days before the date fixed for the hearing and review.

(2) Each other party to a hearing and review shall, if an oral hearing is to be held, serve on every other party and file a statement of the points to be argued and of the facts and law being relied upon by the party at least 5 days before the date fixed for the hearing and review.

 


Rule 8 - Joint Hearings with Other Securities Administrators

(Cross reference: See also section 2(5) of the Securities Act)

8.1 Request for Joint Hearing(1) At the request of a party to a proceeding or on the Commission’s own initiative, the Commission may hold a hearing in or outside of Ontario in conjunction with any other body empowered by statute to administer or regulate trading in securities, if a similar application is being made to the other body or the other body otherwise has jurisdiction over the proceeding.

(2) A request for a joint hearing shall be made in writing and state the reasons why a joint hearing is being requested.

 

8.2 Payment of Expenses(1) If a party requests that a joint hearing be held outside of Ontario, the Commission may, despite any general public interest perceived in the holding of a joint hearing, before and as a condition precedent to its considering the request, require that party to undertake to pay the additional costs incurred by the Commission.

(2) The costs include travel and related expenses incurred by Commissioners and staff and witness fees and expenses.

 


PRACTICE GUIDELINES – JOINT HEARINGS WITH OTHER SECURITIES ADMINISTRATORS

1. Factors in Whether to Hold Joint Hearing – In deciding whether to hold a joint hearing the Commission may take into account any circumstances it considers relevant, which may include whether,

(a) the issues raised through the applications and the evidence and arguments to be presented are likely to be substantially the same, notwithstanding any apparent difference in the form of the several applications or the specific legislation in each jurisdiction;

(b) there is an urgent business reason for holding such a hearing rather than two or more separate hearings; and

(c) the matter in issue is a novel one and it is in the public interest that securities administrators strive to achieve consistency in their decision-making on the matter.

2. Factors in Where to Hold Joint Hearing In deciding where to hold a joint hearing the Commission may take into account any circumstances it considers relevant, which may include,

(a) the preponderance of convenience to the majority of interested parties, taking into account where the majority of the parties reside or have their principal places of business and where witnesses reside; and

(b) where it might be said, if it can be determined, there is the greatest public interest in the pending application.

3. Invitation to Federal Corporations Branch – Where the issue which is the subject of the joint hearing is also of interest to the Director, Corporations Branch, of the federal Department of Consumer and Corporate Affairs in administering the Canada Business Corporations Act, the applicant may also request that the federal officer be invited to join in the hearings.


Rule 9 - Reviews of Commission Decisions

(Cross reference: See also sections 21.1 and 21.2 of the Statutory Powers Procedure Act)

9.1 Application(1) Definition of Final Decision In this Rule 9, “final decision” means a decision or order of the Commission made in a proceeding to which the Statutory Powers Procedure Act applies, which finally disposes of a matter before the Commission on its merits.

(2) Correcting Minor Errors The Commission may at any time correct a typographical error, error of calculation, or other similar error made in a decision without recourse to this Rule 9 and without prior notice to the parties.

(3) Review of Interim Orders Before a final decision is issued, any application to review an interim order or procedural ruling shall, unless the Commission otherwise directs, be made by motion to the Commission panel which made the order or ruling and not under this Rule 9.

(4) Revocation or Variation of a Decision This Rule 9 does not apply to the revocation or variation, pursuant to section 144 of the Securities Act, of a direction, decision, order, ruling or other requirement of the Commission.

 

9.2 Who May Request Review(1) Party or Commission The Commission may review a final decision at the request of a party or on its own initiative.

(2) Other Person Affected by Final Decision Any other person affected by a final decision and to whom the Commission has granted permission, may request a review of the decision.

(3) A request for permission under Paragraph 9.2(2) shall state the person’s interest in the decision and provide reasons for involving the parties in a review of a final decision.

 

9.3 Contents of Review Request – (1) A request for review shall be made in writing and signed by the requester.

(2) the request for review shall,

(a) identify the decision in respect of which the review is being sought;

(b) state the reasons for requesting the review;

(c) state the desired outcome;

(d) attach an affidavit from the requester setting out the facts relied on in support of the request;

(e) attach any documents which support the request; and

(f) if a request is being made for an order staying the decision pending determination of the review, explain why a stay is needed.

 

9.4 Service of Review Request A request for review of a final decision shall be served by the requester on every other party to the original proceeding and filed.

 

9.5 Multiple Review Requests The Commission shall consider only one request for review of a final decision by any one requester.

 

9.6 Assignment and Composition of Panel(1) The Chair or a Vice-Chair, alone or together with other Commissioners shall consider the request for review and decide whether it is advisable to review the final decision.

(2) The Chair or a Vice-Chair may consult with the Commissioner or panel of the Commission that made the final decision.

(3) The consideration of the request for review may be combined with the review of the final decision on the merits, if a quorum of the Commission conducts the review.

(4) The Commissioner or panel of the Commission assigned to consider either or both of the request for review and the merits may, but need not, be the original decision-maker.

 

9.7 Request for Review Procedure(1) Materials Considered on Review Request The Commissioner or panel of the Commission considering the request for review may consider the record from the original hearing, in addition to the materials filed by the requester and any other parties or persons.

(2) Refusal to Grant Request Without Submissions from Others The Commission may refuse a request for review without seeking submissions from any party other than the requester.

(3) Response to Request If the Commission does not refuse the request to review under Paragraph 9.7(2), the Commission shall inform every other party to the original proceeding that they have 10 days to serve on the requester and file a response to the request for review. After receiving the responses the requester shall have 5 days to serve and file a reply.

(4) Procedural Orders The Commissioner or panel of the Commission considering the request for review may make such procedural orders as it considers appropriate and may add other parties in addition to the parties to the original hearing.

(5) Granting Request If the request for review is granted, it may be granted in whole or part, and the decision may contain any procedural directions the Commissioner or panel of the Commission considers appropriate for the review on the merits.

 

9.8 Review on the Merits Procedure – Unless otherwise directed by the Commission and subject to section 5.1 of the Statutory Powers Procedure Act, a review of a final decision on the merits shall be conducted in writing and the procedures in these rules for such a hearing shall apply.

 


Practice Guidelines – Reviews Of Commission Decisions

1. Limits on Decision to Review The Commission will generally only review all or part of a final decision if;

(a) there is significant new evidence that was not available at the time of the original proceeding; or

(b) there have been material changes in circumstances since the original decision.

 

2. Factors in Whether to Review Decision In deciding whether it is advisable to review all or part of a final decision the Commission may take into account any factors it considers relevant, which may include whether,

(a) any party to the proceeding or any other person has relied on the decision;

(b) any party to the proceeding or any other person will be affected by the review process;

(c) any parties to the proceeding consent to the review;

(d) any other rights of appeal exist to the courts; and

(e) the public interest in finality of decisions is outweighed by the prejudice to the requester.


Practice Guidelines - Media At Hearings

1. General – (1) Commission hearings are generally open to the public including all branches of the media.

(2) Nothing in this guideline limits the authority of the Commission to exclude the media, including television, where the public interest so requires. Additionally, nothing in this guideline affects section 9 of the Statutory Powers Procedure Act and the discretion of the Commission to hold hearings in camera.

 

2. Procedure(1) Requests to televise Commission hearings should be made to the Secretary to the Commission. Except where time does not permit, such requests should be made in writing.

(2) Media personnel will be subject to the direction of the Chair of the panel presiding at the hearing.

(3) Media personnel may engage in any activity associated with their coverage of a Commission hearing which is open to the public provided that they limit themselves to one position, in the case of camera crews at the back of the hearing room, and not disrupt the hearing. Disruptive activities include:

(a) interviews of parties in the hearing room while the hearing is in session or nearby so as to disturb the hearing;

(b) television lights, cables, and other equipment which, when in use, could distract the parties to the hearing or witnesses;

(c) electronic flash for still photography;

(d) movement of equipment while the hearing is in session; and

(e) any other behaviour which disrupts or detracts from the process of the hearing.

(4) There are no restrictions on audio recording of a Commission hearing which is open to the public, but microphones should not be placed at the witness area, counsel tables, or the Commission’s dais.

(5) In the event that more than one camera crew wishes to film a Commission hearing, special arrangements such as pooling or time-sharing may be necessary.

(6) Additional information or background materials such as exhibits filed with the Commission will be available, upon request and payment of the Commission’s usual charges, from the Secretary to the Commission.

(7) Any additional information or assistance required may be obtained from the representative of the Secretary’s Office in attendance at the hearing.


Practice Guidelines - Settlement Procedures In Matters Before The
Ontario Securities Commission

1. Application of Guidelines These guidelines set out the procedures which should generally be followed in the settlement of matters before the Commission. The guidelines apply to the settlement of proceedings under section 127 of the Act and may also be applied, with some modification, to other matters before the Commission.

These guidelines deal primarily with settlements which include a joint recommendation as to orders to be imposed or other dispositions of a matter before the Commission. In some cases there may be a settlement only as to agreed facts which may be presented to a panel of the Commission. In those cases the Commission will decide, after hearing the submissions of staff and the respondent, what in its opinion is an appropriate disposition of the matter.

2. Settlement Discussions(1) Discussions Between Staff and Respondent Staff of the Enforcement Branch of the Commission will enter into and carry on settlement discussions with a respondent, at the request of a respondent, where staff is of the view that in the circumstances an appropriate result may be achieved by doing so. Settlement discussions may occur at any time, including prior to the issuance of a Notice of Hearing or at any time thereafter until the matter is finally disposed of.

(2) Involvement of Executive Director Where a proposed settlement requires Commission approval, the Executive Director will also consider the proposed settlement and, if it is acceptable to him or her, will normally sign the proposed settlement agreement on behalf of staff.

3. Meeting with Pre-Hearing Commissioner(1) Request for Pre-Hearing Once a proposed settlement is reached, whether before or after a hearing on the merits has commenced, staff or a respondent may request a meeting with a Commissioner (“Pre-Hearing Commissioner”), to review the proposed settlement prior to it being submitted to the Commission for approval. Also, prior to finalizing a proposed settlement, staff and the respondent, upon their mutual consent, may request a meeting with a Pre-hearing Commissioner. Where a meeting with a Pre-Hearing Commissioner is requested, staff or the respondent should ask the Secretary to the Commission to arrange the meeting.

(2) Role of Pre-Hearing Commissioner At the meeting the Pre-Hearing Commissioner may express his or her view on,

(a) the appropriateness of settlement of the matter in general;

(b) the adequacy or inadequacy of the specific settlement proposal;

(c) the likely outcome of a hearing and the range of orders that might be imposed; and

(d) any other relevant matter.

(3) Pre-Hearing Commissioner’s Views Not Binding Any views expressed by the Pre-Hearing Commissioner will not constitute a decision under the Act or the regulations or rules made thereunder and will not be binding on staff, the respondent or a panel of the Commission which may subsequently be asked to approve the proposed settlement agreement (“Settlement Panel”).

(4) No Communication Relating to Pre-Hearing The Pre-Hearing Commissioner will not sit on the Settlement Panel or on a panel of the Commission which may subsequently hear the matter on the merits (“Hearing Panel”) or communicate with such panel about the matter. Neither staff nor any respondent should inform the Settlement Panel or the Hearing Panel of any statements made by staff or the respondent at the meeting with the Pre-Hearing Commissioner, the views expressed by the Pre-Hearing Commissioner or of the fact of the meeting, except with the mutual consent of staff and all respondents. No one who participates in a meeting with a Pre-Hearing Commissioner should otherwise disclose publicly what transpired at the meeting.

(5) Subsequent Pre-Hearings with Same Commissioner Any subsequent meeting of a pre-hearing nature with a Commissioner will generally be with the same Pre-Hearing Commissioner.

 

4. Settlement Documents(1) Settlement Agreement A settlement should be evidenced by a written settlement agreement between staff and the respondent. The written settlement agreement will be the primary document considered by the Commission in deciding whether to approve the proposed settlement. A settlement agreement should contain,

(a) a full and accurate statement of the relevant facts admitted by the respondent;

(b) a joint recommendation on remedial orders to be imposed by the Commission;

(c) the respondent’s consent to the order being made based upon the facts set out;

(d) an agreed procedure for approval of the settlement;

(e) an agreement concerning confidentiality of the agreement;

and, subject to approval of the settlement agreement,

(f) a waiver by the respondent of a full hearing and judicial review and appeal rights;

(g) a commitment by staff not to initiate further action in relation to the subject facts; and

(h) an agreement by staff and the respondent not to make public statements that are inconsistent with the settlement agreement.

(2) Draft Order In many cases the written settlement agreement will be accompanied by a draft order for consideration by the Commission.

 

5. Commission Review of Proposed Settlement(1) General Prior to the issuance of a notice of hearing, staff may settle a matter with a respondent, with the consent of the Executive Director where appropriate. However, if a Commission order is required to implement the settlement, a notice of hearing will be issued and the proposed settlement submitted to the Commission for approval. Once a notice of hearing has been issued under the Act, any related proposed settlement must be submitted to the Commission for approval, except in circumstances where the notice of hearing is withdrawn by staff.

(2) Consideration of Settlement by Hearing Panel Once a hearing has commenced, the Hearing Panel will generally not consider a proposed settlement. However, a Hearing Panel may consider a proposed settlement of the matter if staff and the respondent so request and if all respondents in the hearing, including respondents who have not entered into settlement agreements (“non-settling respondents”), consent and waive in writing any arguments they may have relating to the panel’s jurisdiction, alleged bias, alleged unfairness or any other challenge as a result of the Hearing Panel considering or commencing on the proposed settlement.

(3) Information Before Settlement Panel At the proceeding to consider a proposed settlement sufficient information must be presented, normally within the written settlement agreement, to permit the Settlement Panel to adequately assess the facts, circumstances and terms of settlement to determine whether or not it is in the public interest to approve the proposed settlement. The Settlement Panel may request whatever additional information or documentation it considers necessary for an adequate consideration or assessment of the matter. Staff and the respondent will have an opportunity to respond to any new issues raised by such additional information or documentation. Staff and the respondent should be prepared to also make submissions relating to the proposed settlement, including submissions on why it would be in the public interest for the Commission to accept the settlement.

(4) Settlement Panel Not Bound by View of Others The Settlement Panel will have complete discretion on whether to approve or not approve a proposed settlement submitted to it, irrespective of any views that may previously have been expressed by a Pre-Hearing Commissioner or staff and irrespective of the fact that the Executive Director may have approved the proposed settlement.

(5) In Camera Proceeding The Commission’s general practice is to hold hearings in public. However, a respondent may be concerned about the terms and facts contained in a proposed settlement agreement being made public in the event that the Commission does not accept the proposed settlement. Where staff or a respondent wish to have the Commission proceeding relating to the proposed settlement held in camera, an application should be made to the Commission under section 9 of the Statutory Powers Procedure Act at the commencement of the proceeding before the Settlement Panel. That section would permit the Commission to hold a hearing in camera where the Commission is of the opinion that “intimate financial or personal matters or other matters may be disclosed at the hearing of such a nature, having regard to the circumstances, that the desirability of avoiding disclosure thereof in the interests of any person affected or in the public interest outweighs the desirability of adhering to the principle that hearings be open to the public.” The Settlement Panel will make a decision on whether or not to hold the proceeding or a portion thereof in camera, based on the facts and circumstances of each case. The Settlement Panel may also decide to hold the settlement proceeding or a portion thereof in camera on its own initiative.

(6) Transcript of In Camera Proceeding In the event that the proceeding or a portion thereof if held in camera, the Settlement Panel will make a decision at the conclusion of the in camera proceeding on whether the transcript of the proceeding should be made public or should not be part of the public record, after hearing submissions from staff, the respondent and any non-settling respondents on the issue. Where the settlement is approved by the Settlement Panel, the transcript of the in camera proceedings will be made public, except in circumstances where the Commission is of the opinion under section 9 of the Statutory Powers Procedure Act, that the transcript should not be part of the public record. Where the proposed settlement is not approved by the Commission, the transcript of the in camera proceeding will generally not be made public.

(7) Where Proposed Settlement Approved Based upon the facts, circumstances and terms of the proposed settlement before it and the submissions made, the Settlement Panel will decide whether or not in its opinion the proposed settlement is appropriate in the public interest. If the Settlement Panel decides it is appropriate, the Settlement Panel will approve the settlement and sign any related order.

 

6. Where Proposed Settlement Not Approved(1) Reasons If the Commission decides not to approve the proposed settlement, it will provide reasons to the parties at the request of either staff or the respondent. In most cases such reasons would outline general areas of concern relating to proposed settlement and would not usually suggest specific changes to the proposal. Staff, the respondent or a non-settling respondent may apply to have the reasons delivered in camera, and the Commission will make a decision whether it is appropriate to do so under section 9 of the Statutory Powers Procedure Act. In most cases where the settlement proceeding is held in camera and the proposed settlement is not approved, the Commission’s reasons in relation thereto would also be delivered in camera.

(2) Subsequent Settlement Considered by Same Panel If staff and the respondent subsequently agree to another proposed settlement, it will generally be considered by the same Settlement Panel.

(3) No Communication Relating to Proposed Settlement at Hearing Where the Commission does not approve a proposed settlement, staff may decide to proceed with a full hearing of the matter on the merits. In that case, staff and the respondent may withdraw from the settlement agreement and then neither party may raise the terms of the agreement in the hearing or any other proceeding and the hearing will proceed unaffected by the proposed settlement agreement and negotiations. Commissioners who considered the proposed settlement will not sit on the Hearing Panel and will not communicate with the Hearing Panel about the matter (except where the settlement is considered during the course of a hearing by the Hearing Panel on consent as described above).

 

7. Publication of Settlement Agreement(1) Publication Where Approved After a proposed settlement is approved by the Commission, the settlement agreement and any related order will be published in the OSC Bulletin. Where a respondent, including a non-settling respondent, has reason for not wanting a settlement agreement to be made public for a period of time, the respondent may apply to the Commission for an order to that effect. The policy of the Commission is to make approved settlement agreements public immediately, in the absence of exceptional circumstances.

(2) No Publication Where Not Approved Where a settlement agreement is not approved by the Commission it will not be published in the OSC Bulletin or be part of a public file.

 

Final rule : (1997) O.S.C.B. 1947 effective July 1, 1997; Request for Comments: (1995) 18 O.S.C.B. 4041.