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OSC and out-of-province securities transactions


Area Corporate Finance and Securities


The Supreme Court of Canada has affirmed the broad discretion of the Ontario Securities Commission to refuse to regulate transactions that, although abusive of minority shareholders and contrary to the principles of Ontario securities law, are insufficiently connected to Ontario. Consequently, persons trading in securities of companies that are reporting issuers in Ontario may not be required to comply with Ontario securities law where such transactions take place outside of Ontario.

In Committee for Equal Treatment of Asbestos Minority Shareholders v. Ontario (Securities Commission), the SCC held that the OSC acted reasonably and within its jurisdiction when it decided not to interfere in a transaction pursuant to which a non-resident purchaser acquired, from a U.S. shareholder, a majority interest in an Ontario reporting issuer, without making the same offer to minority shareholders.

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