Civil
liability for secondary market disclosure provisions come into
force February 15, 2008
On February 15, 2008 section 51 of
The Securities Amendment Act, 2007
comes into force. Section
51 adds new Part
XVIII.1 "Civil Liability for Secondary Market Disclosure" to
The Securities Act, 1988.
New Part XVIII.1
– Civil Liability for Secondary Market Disclosure contains
provisions that make reporting issuers civilly liable to investors
in the secondary market for misrepresentations in their
public disclosure, subject to reasonable limitations.
The new
provisions in Part XVIII.1 are uniform with equivalent provisions in the Securities Act
(Ontario) that came into force on January 1, 2006 with two
exceptions:
-
There is no
provision equivalent to section 138.11 (costs) of the Ontario act.
In Saskatchewan the normal provisions respecting costs in civil
actions will apply.
-
There is no
provision equivalent to section 138.14
(limitation periods) of the Ontario act. In Saskatchewan,
section 147 of The Securities Act, 1988 will apply to
actions under new Part XVIII.1.
Amendments to The Securities Act, 1988
The
following provisions of
The Securities Amendment Act, 2007
will also
come into force on February 15, 2008:
-
section 52 - amends section 137 "Misrepresentation in prospectus"
-
section 53 - amends section 138.1 "Misrepresentation in sales
literature
-
section 54 - amends section 139 "Misrepresentation in take-over
bid circular, etc"
-
section 56 - amends section 141 "Liability of dealer or offeror"
The amendments harmonize the wording of these provisions with the
new provisions in Part XVIII.1.
Amendments to The Securities
Regulations
The Securities Amendment Regulations, 2008
will come also into force on February 15, 2008. These amendments
define the following terms that
are used in Part XVIII.1:
-
market capitalization,
-
principal market, and
-
trading price.
