Securities rule-making in Ontario

The Ontario Securities Commission (OSC) must follow two distinct steps in order to make securities rules of a binding nature:

1. Publicize proposed rules for public comment

Unless an exception to the notice requirement applies, the OSC is required to publish proposed rules for public comment. The public is provided at least 90 days to consider a proposed rule and submit comments to the OSC. If the Commission makes a material amendment to a proposed rule after the initial comment period, the Commission must republish the proposed rule for comment.

2. Make a proposed rule into a law

In order for a proposed rule to come into force, the OSC must make the rule in its final form and deliver it to the Minister of Finance for review, as well as publish it in the OSC Bulletin. The Minister then has 60 days to approve or reject the rule, or return it to the Commission for further consideration. If the Minister does not approve, reject or return the rule, it becomes effective 15 days following the conclusion of the 60-day period.

In addition to rule-making, the OSC may adopt policies of a non-binding nature, including the Commission’s interpretations of rules made by it. Unlike rules however, policies may not be prohibitive or mandatory in character.

The OSC must publish proposed policies for public comment and re-publish the policy for further comment should the Commission propose a material changes to it following receipt of public feedback. Once the Commission is satisfied with the proposed policy, it may adopt it without Ministerial approval to become effective.