On July 22, 2021, the Ontario Securities Commission (OSC) published OSC Staff Notice 15-707 Enforcement Investigation Guidance and OSC Staff Notice 15-708 Document Production Guidance (the Guidance) to assist individuals and companies that participate in initial assessments and investigations conducted by OSC Enforcement Staff (Staff). The Guidance provides added transparency on the processes and timeliness that individuals and companies can expect when they are interacting with Staff, as well as setting out Staff’s preferred production methods to assist those responding to Staff request for records and documents.
Staff expect all persons and companies involved in enforcement assessments and investigations to co-operate fully and may give credit as applicable and appropriate. Examinees in enforcement assessments and investigations have a right to have counsel present. The length of enforcement investigations and assessments vary depending on complexity and volume of data.
The OSC may issue written notice that it requires you to produce records and documents as part of an investigation. The Guidance sets out the OSC’s preferred production methods for records it requires or requests in the course of carrying out its regulatory functions. Following the Guidance may reduce time, costs and resources for Staff and parties producing records to Staff. Importantly, the Guidance reminds us that the powers of compulsion in securities and commodity futures legislation do not empower Staff to compel the production of records that are privileged although privilege must be asserted in writing with enough specificity to support the assertion.
If Staff intend to bring regulatory proceedings at the conclusion of Staff’s investigation, Staff may offer to meet with those involved in the investigation (or their counsel) to discuss the findings of the investigation and consider whether there is potential for early settlement. If there does not appear to be a likelihood of early settlement, Staff may deliver a confidential Enforcement Notice advising of the conclusion of Staff’s investigation and Staff’s intention to commence a regulatory proceeding.
If you are the subject of an investigation or have been requested to produce records and documents, or would like to discuss any element of the Guidance, please contact us.
August 31, 2021