BILL 38 – 2004
SECURITIES ACT

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of the Province of British Columbia, enacts as follows:

Contents

 
Part 1 -- Definitions and Interpretation

Definitions

1 In this Act:

"adviser" means a person engaging in, or holding himself, herself or itself out as engaging in, the business of

(a) managing an investment portfolio on behalf of another person, or

(b) advising another person in relation to investing in or trading in securities;

"affiliate" means, in relation to an issuer, another issuer if

(a) one of them is the subsidiary of the other, or

(b) the same person controls each of them;

"associate" means, if used to indicate a relationship with a person,

(a) a partner, other than a limited partner, of the person,

(b) a trust or estate in which the person has a substantial beneficial interest or for which the person serves as trustee or in a similar capacity,

(c) an issuer in relation to which the person owns or controls voting securities carrying more than 10% of the voting rights attached to all outstanding voting securities of the issuer, or

(d) a family member of the person, or a family member of the person's spouse, if the family member has the same home as that person;

"business combination" means an amalgamation, merger, arrangement or similar transaction;

"commission" means the British Columbia Securities Commission continued under Part 11;

"continuous disclosure record" means the information that an issuer files or is required to file under Part 4 [Offerings] and Part 5 [Continuous Disclosure];

"dealer" means a person that is in the business of trading in securities as principal or agent;

"decision" means,

(a) if used in relation to the commission or a person delegated a power of the commission, a direction, decision, order, ruling or requirement made under this Act or the regulations, or

(b) if used in relation to a marketplace, self-regulatory organization or regulatory organization, a direction, decision, order, ruling or requirement made in relation to a regulatory instrument;

"derivative" means any right or obligation to make or take future delivery of

(a) a security,

(b) currency,

(c) a mineral, metal or precious stone,

(d) any other thing or interest if the unit of that thing or interest is naturally or by custom treated as the equivalent of any other unit, or

(e) cash, if the amount of cash is derived from, or by reference to, a variable, including

(i) a price or quote for anything described in paragraphs (a) to (d),

(ii) an interest rate,

(iii) a currency exchange rate, or

(iv) an index or benchmark,

unless the right or obligation is described in an order made under section 152 (1) or the right or obligation is within a prescribed class of rights or obligations;

"director" means a director of a corporation, or an individual performing a similar function or occupying a similar position for a corporation or for any other person;

"due-diligence provider" means a person, other than an underwriter, that

(a) in connection with a public offering of an issuer,

(i) reviews the business, affairs and securities of the issuer, and a prospectus or other disclosure document prepared in connection with the public offering, and

(ii) provides an opinion as to the disclosure in the prospectus or other disclosure document, and

(b) has been approved by the commission;

"family member" means a person's spouse, parent, grandparent, brother, sister, child or grandchild;

"fund manager" means, in relation to a mutual fund, a person that directs the affairs of the mutual fund;

"inside information" means material information, or significant information, that has not been generally disclosed;

"insider" means

(a) a director, senior officer or significant securityholder of an issuer, or

(b) a director or senior officer of a subsidiary of an issuer, or of a significant securityholder of an issuer, if the director or senior officer's responsibilities routinely provide the individual with access to inside information about the issuer;

"issuer" means a person that

(a) has a security outstanding, or

(b) proposes to issue a security;

"market participant" means

(a) a marketplace,

(b) a self-regulatory organization or regulatory organization,

(c) a clearing agency,

(d) a registrant,

(e) a partner, director, officer, significant securityholder or representative of a registrant,

(f) a person providing record-keeping services to a registrant,

(g) a compensation, contingency or similar fund formed to compensate clients of dealers or advisers,

(h) an issuer,

(i) a due-diligence provider,

(j) a fund manager, or custodian of assets or securities, of a mutual fund,

(k) a transfer agent or registrar for securities of an issuer,

(l) a director, officer or significant securityholder of an issuer,

(m) a general partner of a person referred to in this definition,

(n) a person that the commission has ordered is exempt from a provision of this Act or the regulations, or

(o) a person described in an order made under section 152 (2),

unless the person is described in an order made under section 152 (1) or the person is within a prescribed class of persons;

"marketplace" means

(a) an exchange, a quotation and trade reporting system, or any other person that facilitates the matching of orders to buy and sell securities, or

(b) a person described in an order made under section 152 (2),

unless the person is described in an order made under section 152 (1) or the person is within a prescribed class of persons;

"material information" means information relating to the business, operations or securities of an issuer that would reasonably be expected to significantly affect the value or market price of the issuer or a security of the issuer;

"misrepresentation" means,

(a) in relation to an issuer,

(i) an untrue statement of material information or significant information,

(ii) the failure to disclose material information or significant information that is required to be disclosed, or

(iii) the omission of material information or significant information from a statement, if that information is necessary to prevent the statement from being false or misleading in the circumstances, or

(b) in any other circumstance, a statement about something that a reasonable investor would consider important

(i) in making a decision to trade a security, or

(ii) in relation to a trading or advising relationship with a person,

if the statement is untrue or omits information necessary to prevent the statement from being false or misleading in the circumstances;

"mutual fund" means

(a) an issuer of a security that entitles the holder to receive on demand, or within a specified period after demand, an amount computed by reference to the value of a proportionate interest in the whole or in a part of the net assets, including a separate fund or trust account, of the issuer of the security, including a separate fund or trust account, or

(b) a person described in an order made under section 152 (2),

unless the person is described in an order made under section 152 (1) or the person is within a prescribed class of persons;

"offering" means

(a) a trade in a security of an issuer that has not been previously issued,

(b) a trade, by or on behalf of an issuer, in a previously issued security of that issuer that has been redeemed, purchased by or donated to that issuer,

(c) a trade in a previously issued security of an issuer by a securityholder that

(i) holds more than 20% of the voting rights attached to all the issuer's outstanding voting securities, or

(ii) is able to affect materially the control of the issuer, whether alone or by acting in concert with others,

(d) a trade within a prescribed class of trades,

(e) a transaction or series of transactions involving further trades in the course of or incidental to a trade referred to in paragraphs (a) to (d), or

(f) a trade described in an order made under section 152 (2);

"officer" means an individual working in an executive capacity for an issuer, registrant or any other person;

"person" includes an individual, corporation, partnership, party, trust, fund, association and any other organized group of persons, and the personal or other legal representative of any person to whom the context can apply;

"public issuer" means an issuer, other than a mutual fund, that

(a) has filed a prospectus for which the commission has issued a receipt,

(b) has filed a notice under section 19 for which the commission has issued a receipt,

(c) has completed a takeover, business combination or other reorganization, involving an exchange of securities in which one of the parties was a public issuer,

(d) has issued a security that has, at any time after this Act comes into force, been traded on a prescribed marketplace,

(e) was a reporting issuer under the Securities Act, R.S.B.C. 1996, c. 418, at the time it was repealed, or

(f) is described in an order made under section 152 (2),

unless the issuer is described in an order made under section 152 (1) or the issuer is within a prescribed class of issuers;

"public mutual fund" means a mutual fund that

(a) has filed a prospectus for which the commission has issued a receipt,

(b) has filed a notice under section 19 for which the commission has issued a receipt,

(c) was a reporting issuer and a mutual fund under the Securities Act, R.S.B.C. 1996, c. 418, at the time it was repealed, or

(d) is described in an order made under section 152 (2),

unless the mutual fund is described in an order made under section 152 (1) or the mutual fund is within a prescribed class of mutual funds;

"record" includes a book, document, map, drawing, photograph, letter, voucher, paper and any other thing on which information is recorded or stored by any means, whether graphic, electronic, mechanical or otherwise;

"registrant" means a person registered or required to be registered under this Act;

"regulation" includes a commission rule;

"regulator" means a government, agent of government, or other entity empowered by the laws of a jurisdiction to regulate trading in securities or to administer or enforce securities laws;

"regulatory instrument" means a bylaw, rule or other similar instrument, of a marketplace, self-regulatory organization or regulatory organization;

"regulatory organization" means a person that, for or on behalf of another person, sets standards, or monitors conduct, relating to trading in or advising on securities;

"representative" means, when used in relation to a registrant, a person that trades a security, or acts as an adviser, directly or indirectly, for or on behalf of the registrant;

"security" includes

(a) an instrument commonly known as a security,

(b) an interest in or to a security,

(c) a bond, debenture, note or other evidence of indebtedness other than

(i) a contract of insurance issued by an insurer, and

(ii) an evidence of deposit issued by a savings institution,

(d) an investment contract,

(e) an income or annuity contract, other than one made by an insurer,

(f) a scholarship, or educational, plan or trust, and

(g) a derivative,

whether or not it is evidenced by a document or relates to an issuer, but does not include a security within a prescribed class of securities;

"self-regulatory organization" means a person, other than a marketplace, that sets standards for, or monitors conduct of, its members or participants relating to trading in or advising on securities;

"senior officer" means an officer of an issuer whose responsibilities routinely provide the officer with access to inside information about the issuer;

"significant change" means

(a) a change in the business, operations or securities of a mutual fund that would be considered important by a reasonable investor in determining whether to trade a security of the mutual fund, or

(b) a decision to implement a change referred to in paragraph (a) made

(i) by senior management of the mutual fund who believe that confirmation of the decision by the board of directors is probable, or

(ii) by senior management of the fund manager of the mutual fund who believe that confirmation of the decision by the board of directors of the fund manager is probable;

"significant information" means information relating to the business, operations or securities of a mutual fund that a reasonable investor would consider important in making a decision about whether to trade securities of the fund or issuer;

"significant securityholder" means, in relation to a person, a securityholder that

(a) owns or controls 10% or more of any class of the person's voting securities, excluding any securities that the securityholder, if a registrant, holds in the course of a public offering, or

(b) is able to affect materially the control of the person, whether alone or by acting in concert with another person;

"spouse" means a person who

(a) is married to another person, and is not living separate and apart, within the meaning of the Divorce Act (Canada), from the other person, or

(b) is living and cohabiting with another person in a marriage-like relationship, including a marriage-like relationship between persons of the same gender;

"subsidiary" means an issuer that is controlled by another issuer;

"trade" includes

(a) an acquisition or disposition of a security for valuable consideration,

(b) an acquisition, disposition or creation of a derivative,

(c) the receipt or execution by a registrant of an order to buy or sell a security,

(d) a transfer of ownership of a security to a person under a realization on collateral given for a debt, and

(e) any act, advertisement, solicitation, conduct, negotiation or transaction in direct or indirect furtherance of any activity referred to in paragraphs (a) to (d);

"underwriter" means a registered dealer that trades securities in connection with a public offering, other than a dealer whose only interest in the offering is receiving the usual and customary commission for selling securities.

Ownership

2 In this Act, a person owns a security if the security is beneficially owned by the person.

Control of security

3 In this Act, a person controls a security if

(a) the person, directly or indirectly, directs the trading or voting of the security,

(b) the security is owned by an issuer that the person controls, or

(c) the security is owned by an affiliate of the person or of an issuer that the person controls.

Control of issuer

4 In this Act, a person controls an issuer if the person owns or controls a sufficient number of the issuer's securities to elect a majority of the directors of the issuer.

 
Part 2 -- Market Regulation

Definition

5 In this Part, "regulated person" means,

(a) for a recognized marketplace, a member or participant of the marketplace and an employee, agent or representative of the member or participant,

(b) for a recognized self-regulatory organization, a member or participant of the self-regulatory organization and an employee, agent or representative of the member or participant, and

(c) for a recognized regulatory organization, a person specified under section 7 (3), a member or participant of the person, and an employee, agent or representative of the member or participant.

Recognition requirement

6 Unless recognized under section 7, a person must not operate as a marketplace.

Application for recognition

7 (1) On application, the commission must recognize a marketplace unless the commission considers it prejudicial to the public interest to do so.

(2) On application, the commission may recognize a self-regulatory organization or a regulatory organization.

(3) An order made under subsection (2) recognizing a regulatory organization must specify the person for or on whose behalf the regulatory organization sets standards of conduct or monitors conduct.

(4) A recognition is effective until

(a) it is revoked by the commission,

(b) it expires, or

(c) the commission accepts a surrender of recognition under section 13.

(5) Before refusing to grant or revoking a recognition, the commission must provide an opportunity to be heard.

Conditions and restrictions on recognition

8 (1) The commission may, with respect to a recognition made under section 7,

(a) restrict or vary the recognition,

(b) impose a condition on the recognition, or

(c) restrict the duration of the recognition.

(2) Before making a decision under subsection (1), the commission must provide an opportunity to be heard.

Duty to regulate

9 A person recognized under section 7 must monitor the conduct of its regulated persons relating to the trading in or advising on securities.

Duty to comply

10 A regulated person must comply with an applicable regulatory instrument.

Approval of regulatory instruments

11 If a person recognized under section 7 adopts, amends or repeals a regulatory instrument, the adoption, amendment or repeal is not effective until it is approved by the commission.

Commission powers

12 If the commission considers it in the public interest to do so, the commission may make a decision about a person recognized under section 7, including a decision about

(a) the person's regulatory instruments,

(b) the person's procedures or practices,

(c) the business or regulatory services provided by the person,

(d) trading or quotation activity on a marketplace,

(e) a security or class of securities traded or quoted on a marketplace, or

(f) an issuer whose securities are traded or quoted on a marketplace.

Surrendering recognition

13 (1) If a person recognized under section 7 applies to the commission to surrender its recognition, the commission must accept the surrender unless the commission considers it prejudicial to the public interest to do so.

(2) On receiving an application under subsection (1), the commission may, without providing an opportunity to be heard, suspend or impose a condition or restriction on the recognition.

 
Part 3 -- Registration

Registration requirement

14 Unless registered, a person must not

(a) trade in a security, or

(b) act as an adviser.

Application for registration

15 (1) The commission must register an applicant for registration unless the commission considers it prejudicial to the public interest to do so.

(2) Before refusing to register an applicant, the commission must provide an opportunity to be heard.

(3) A registration granted under this section is effective until

(a) it is revoked by the commission,

(b) it expires, or

(c) the commission accepts the surrender of the registration under section 17.

Conditions and restrictions on registration

16 (1) The commission may

(a) restrict or vary a registration,

(b) impose conditions on a registration, or

(c) restrict the duration of a registration.

(2) Before making a decision under subsection (1), the commission must provide an opportunity to be heard.

Surrender of registration

17 (1) If a registrant applies to surrender its registration, the commission must accept the surrender unless the commission considers it prejudicial to the public interest to do so.

(2) On receiving an application under subsection (1), the commission may, without providing an opportunity to be heard, suspend the registration or impose a condition or restriction on the registration.

 
Part 4 -- Offerings

Offering of securities

18 (1) A person must not make an offering of a security unless a prospectus for the security has been filed and the commission has issued a receipt for the prospectus.

(2) A prospectus filed under subsection (1) must be in the required form.

(3) Subject to the regulations, subsection (1) does not apply to an offering of a security of a public issuer that has filed

(a) all information and records referred to in sections 22 and 23, and

(b) all information and records referred to in the regulations relating to those sections.

Issuer reporting in other province

19 If an issuer is a reporting issuer, or an equivalent of a reporting issuer, under the securities laws of a province, the issuer is a public issuer or a public mutual fund under this Act if

(a) it has filed a notice in the required form, and

(b) the commission has issued a receipt for the notice.

Disclosure in prospectus

20 A prospectus filed under this Act must, if filed by

(a) an issuer other than a mutual fund, disclose all material information about the issuer, or

(b) a mutual fund, disclose all significant information about the mutual fund.

Receipt for prospectus or notice

21 (1) The commission must issue a receipt for a prospectus filed under this Act, or a notice filed under section 19, unless the commission considers it prejudicial to the public interest to do so.

(2) Before the commission refuses to issue a receipt for a prospectus or a notice under subsection (1), it must provide an opportunity to be heard.

 
Part 5 -- Continuous Disclosure

 
Division 1 -- Issuer Disclosure

Periodic disclosure

22 A public issuer or public mutual fund must, at the prescribed times, disclose information about the business, operations and securities of the issuer or fund in accordance with the regulations.

Disclosure of all material information by public issuer

23 If the continuous disclosure record of a public issuer does not contain all material information about the issuer, the issuer must issue and file, as soon as practicable, a news release disclosing the material information not contained in the record.

Disclosure of significant changes by public mutual fund

24 If a significant change occurs in the affairs of a public mutual fund, the public mutual fund must issue and file a news release disclosing the significant change within the prescribed time.

 
Division 2 -- Insiders of Public Issuers

Initial insider report

25 An insider of a public issuer who

(a) owns or controls a security of the issuer, or

(b) owns or controls, or has entered into a transaction involving, a security the value of which is derived from or varies materially with the value or market price of a security of the issuer,

must within the prescribed time file a report in the required form.

Subsequent insider report

26 If an insider of a public issuer filed or was required to file a report under section 25 and

(a) there is a change in the insider's ownership or control of a security of the issuer, or of a security the value of which is derived from, or varies materially with, the value or market price of a security of the issuer,

(b) the insider enters into a transaction involving a security of the issuer or a security the value of which is derived from, or varies materially with, the value or market price of a security of the issuer, or

(c) there is a change in a transaction referred to in paragraph (b) or in section 25 (b), or a change in the security involved in the transaction,

the insider must, within the prescribed time, file a report in the required form.

 
Part 6 -- Market Participant Conduct

Manipulation and fraud

27 A person must not engage in or participate in conduct relating to securities if the person knows, or reasonably should know, that the conduct

(a) results in or contributes to a misleading appearance of trading activity in, or an artificial price for, a security, or

(b) perpetrates a fraud on any person.

Misrepresentation

28 A person must not make a misrepresentation in relation to

(a) an issuer or a trade, or

(b) a trading or advising relationship.

Unfair practice

29 (1) A person must not engage in an unfair practice.

(2) For the purpose of subsection (1), "unfair practice" includes doing any of the following in connection with a security, a trade, or a trading or advising relationship:

(a) putting unreasonable pressure on a person;

(b) taking advantage of a person's

(i) inability or incapacity to reasonably protect his or her own interest because of physical or mental infirmity, ignorance, illiteracy or age, or

(ii) inability to understand the character, nature or language of any matter relating to that person's decision whether to trade a security;

(c) imposing terms or conditions that make a transaction inequitable.

Insider trading, tipping and recommending

30 (1) In this section:

"connected person" means, in relation to an issuer,

(a) an insider, officer, employee, affiliate or associate of the issuer,

(b) a person that is making or proposing to make a takeover bid for the securities of the issuer,

(c) a person that is proposing to

(i) become a party to a reorganization or business combination with the issuer, or

(ii) acquire a substantial portion of the property of the issuer,

(d) a person engaging in or proposing to engage in any business or professional activity with or on behalf of the issuer or with or on behalf of a person referred to in paragraph (b) or (c),

(e) an insider, officer, employee, affiliate or associate of a person referred to in paragraph (b), (c) or (d),

(f) a person with inside information, if the information was obtained at a time when the person was a connected person under paragraph (a), (b), (c), (d) or (e), or

(g) a person that obtained inside information from another person

(i) who, at the time, was a connected person under this definition, including this paragraph, and

(ii) whom the person knew or reasonably should have known was a connected person;

"issuer" means

(a) a public issuer,

(b) a public mutual fund, or

(c) any other issuer whose securities are publicly traded.

(2) A person that

(a) is a connected person of the issuer, and

(b) has inside information about the issuer

must not

(c) trade a security of the issuer, or

(d) enter into a transaction involving a security the value of which is derived from or varies materially with the value or market price of a security of the issuer.

(3) An issuer, or a connected person of an issuer, must not inform another person of inside information about the issuer unless it is necessary in the course of the issuer's or the person's business.

(4) An issuer, or a connected person of an issuer, with inside information about the issuer, must not recommend or encourage another person to

(a) trade a security of the issuer, or

(b) enter into a transaction involving a security the value of which is derived from or varies materially with the value or market price of a security of the issuer.

Front running

31 (1) In this section, "material order information" means information that relates to

(a) the intention of a person responsible for making decisions about an investment portfolio to trade a security on behalf of the investment portfolio,

(b) the intention of a registrant trading on behalf of an investment portfolio to trade a security on behalf of the investment portfolio, or

(c) an unexecuted order, or the intention of any person to place an order, to trade a security,

and that, if disclosed, would reasonably be expected to affect the market price of the security.

(2) If a person knows of material order information, the person must not

(a) trade a security that is the subject of the information,

(b) enter into a transaction involving a security the value of which is derived from or varies materially with the value or market price of the security referred to in paragraph (a),

(c) inform another person of the material order information, unless it is necessary in the course of the person's business, or

(d) recommend or encourage another person to

(i) trade the security referred to in paragraph (a), or

(ii) enter into a transaction involving a security the value of which is derived from or varies materially with the value or market price of the security referred to in paragraph (a).

Belief that other party knows information

32 (1) A person does not contravene section 30 (2) or 31 (2) (a) or (b) if, at the time the person trades the security, the person reasonably believes that the purchaser or seller of the security knows the inside information or material order information.

(2) A person does not contravene section 30 (3) or (4) or 31 (2) (c) or (d) if, at the time the person

(a) informs the other person of the inside information or material order information, or

(b) recommends or encourages the other person to trade the security,

the person reasonably believes that the other person knows the information.

Automatic or predetermined trade

33 A person does not contravene section 30 (2) or 31 (2) (a) or (b) if the person

(a) trades the security under a written automatic dividend reinvestment plan, written automatic purchase plan or other similar written automatic plan, in which the person agreed to participate before obtaining the inside information or material order information, or

(b) trades the security as a result of a written legal obligation

(i) imposed on the person, or

(ii) that the person entered into before obtaining the inside information or material order information.

Trading as agent

34 A person does not contravene section 30 (2) or 31 (2) (a) or (b) if the person trades

(a) as agent under the specific unsolicited instructions of the principal,

(b) as agent under specific instructions that the agent solicited from the principal before obtaining the inside information or material order information,

(c) as agent or trustee for another person because of that other person's participation in a written automatic dividend reinvestment plan, written automatic purchase plan or other similar written automatic plan, or

(d) as agent or trustee for another person to fulfill a written legal obligation of the other person.

Trade or recommendation by individual
with no inside or material order information

35 A person does not contravene section 30 (2) or (4) or section 31 (2) (a), (b) or (d) if

(a) the person is not an individual, and

(b) the individual making the trade or recommendation on behalf of the person does not have inside information or material order information, and is not acting on the advice or recommendation of an individual who does have that information.

Duty to comply with decision

36 A person must comply with a decision of the commission.

Duty to comply with undertaking

37 A person that gives a written undertaking to the commission must comply with the undertaking.

Declaration as to short position

38 (1) A person that places an order through a registered dealer for the sale of a security must, at the time of placing the order to sell, notify the dealer if

(a) the person does not own, or control the delivery of, the security, or

(b) the security has a restriction on its sale.

(2) Subsection (1) does not apply to a person acting as agent for a principal that has a beneficial or legal interest in the security.

Representations of commission approval

39 A person must not represent that the commission has in any manner expressed an opinion or passed judgment on

(a) the financial standing, fitness or conduct of a registrant,

(b) the merits of a security or of an issuer, or

(c) an issuer's disclosure.

False or misleading statements to commission

40 A person must not make a statement or provide a record to the commission that, in a material respect and at the time and in the light of circumstances under which it is made or provided,

(a) is false or misleading, or

(b) omits to state a fact that is necessary to be stated so that the statement or record is not false or misleading.

Obstruction of justice

41 (1) A person must not destroy, conceal or withhold any information, record or thing reasonably required for a hearing, review or investigation under this Act.

(2) A person contravenes subsection (1) if the person knows or reasonably should know that a hearing, review or investigation is to be conducted and the person takes any action referred to in subsection (1) before the hearing, review or investigation.

 
Part 7 -- Compliance and Enforcement

 
Division 1 -- Compliance Reviews

Compliance review of recognized persons,
registrants and representatives

42 (1) For the purpose of determining if the person is complying with this Act or the regulations, the commission may review the conduct of

(a) a person recognized under section 7, or

(b) a registrant or representative.

(2) For the purposes of subsection (1), the commission may, in writing, appoint another person to conduct the review.

(3) The commission, or a person appointed under subsection (2), may, by notice in writing, require a person under review to produce information, a record or thing, or a class of records or things, that reasonably relates to the review.

(4) After receiving a notice under subsection (3), a person must, as soon as practicable, provide to the commission or appointed person the information, record or thing that is described in the notification and that is in the custody, possession or control of the person.

(5) The commission, or a person appointed under subsection (2), may

(a) enter, during business hours, the business premises of the person under review,

(b) review any record or thing at the premises that reasonably relates to the review,

(c) require the person under review to produce information, a record or thing, or a class of records or things, that reasonably relates to the review,

(d) copy any record at the premises that reasonably relates to the review, and

(e) on giving a receipt, remove from the premises any record or thing that reasonably relates to the review.

(6) If a person enters premises under subsection (5), the person must present proof of his or her authority to do so.

(7) A record or thing removed under subsection (5) (e) must be returned to the person from whom, or premises from which, it was taken as soon as practicable.

(8) After providing an opportunity to be heard, the commission may require a person that is the subject of a review under this section to pay prescribed fees or prescribed charges relating to the review.

Compliance review of issuers and related persons

43 (1) For the purpose of determining if the person is complying with this Act or the regulations, the commission may review the conduct of

(a) a public issuer,

(b) a public mutual fund,

(c) a due-diligence provider,

(d) a fund manager, or

(e) a custodian of assets of a mutual fund.

(2) For the purposes of subsection (1), the commission may, in writing, appoint another person to conduct the review.

(3) The commission, or a person appointed under subsection (2), may, by notice in writing, require a person under review to produce information, a record or thing, or a class of records or things, that reasonably relates to the review.

(4) After receiving a notice under subsection (3), a person must, as soon as practicable, provide to the commission or appointed person the information, record or thing that is described in the notification and that is in the custody, possession or control of the person.

(5) After providing an opportunity to be heard, the commission may require a person that is the subject of a review under this section to pay prescribed fees or prescribed charges relating to the review.

Cease trade order for non-compliance

44 (1) Without providing an opportunity to be heard, the commission may order a person, a class of persons or all persons to cease trading a security, a class of securities or all securities, if the issuer of the security or the person named in the order

(a) fails to file a record required to be filed under this Act or the regulations,

(b) files a record that is not completed in accordance with this Act or the regulations, or

(c) fails to pay a fee required to be paid under this Act or the regulations.

(2) Subject to subsection (3), the commission must revoke an order made under subsection (1) as soon as practicable after

(a) all records required to be filed under this Act or the regulations, whether or not mentioned in the order, have been filed,

(b) all records, whether or not mentioned in the order, have been completed in accordance with this Act and the regulations, and

(c) all fees required to be paid under this Act or the regulations, whether or not mentioned in the order, have been paid.

(3) If a person must file a prescribed record for which the commission is empowered to issue a receipt, the commission is not required to revoke an order made under subsection (1) until it has issued the receipt.

(4) The commission must send an order made under this section, and any variation or revocation of it, to each person named in the order.

Reprimand

45 After providing an opportunity to be heard, the commission may reprimand a person for a contravention of this Act or the regulations.

 
Division 2 -- Production Orders

Production orders

46 The commission may make an order under section 47

(a) for the administration of this Act and the regulations, or

(b) to assist in the administration of the securities laws of another jurisdiction.

Market participants

47 The commission may order a person that is or was a market participant, in relation to the person's business or affairs as a market participant, to

(a) produce information, a record or thing, or a class of records or things, specified or otherwise described in the order, or

(b) prepare and produce a record based on records or information already in existence.

Verification

48 The commission may require verification by affidavit of information provided, or of records or things produced, under section 47.

 
Division 3 -- Investigations

Investigation order

49 (1) If the commission considers it expedient, the commission may order an investigation

(a) for the administration of this Act or the regulations, or

(b) to assist in the administration of the securities laws of another jurisdiction.

(2) An order made under subsection (1) must specify the scope of the investigation.

(3) For the purposes of subsection (1), the commission may conduct the investigation or may, in writing, appoint another person for that purpose.

Power to compel evidence

50 (1) The commission, or an investigator appointed under section 49 (3) or 58 (1), has the same power as the Supreme Court has for the trial of civil actions to

(a) summon the attendance of a witness,

(b) compel a witness to give evidence, and

(c) compel a witness to produce a record or thing, or a class of records or things, in the custody, possession or control of the witness.

(2) Despite section 34 (5) [financial institution not compellable] of the Evidence Act, no financial institution, as defined in that section, and no officer or employee of a financial institution, is exempt from the operation of this section.

Counsel may attend

51 Counsel may represent a witness who gives evidence under section 50.

Entry of premises and production of records

52 (1) If the commission considers it necessary and in the public interest to do so, the commission may make an order authorizing an officer or employee appointed under section 140, or a person appointed under section 49 (3), to

(a) enter, during business hours, business premises of a registrant or representative, or a person recognized under section 7,

(b) review any record or thing at the premises that reasonably relates to the order made under section 49,

(c) require a person at the premises to produce information, a record or thing, or a class of records or things, that reasonably relates to the order made under section 49 and that is in the custody, possession or control of the person,

(d) copy any record at the premises that reasonably relates to the order made under section 49, and

(e) on giving a receipt, remove from the premises any record or thing that reasonably relates to the order made under section 49.

(2) If a person enters premises under subsection (1), the person must present proof of his or her authority to do so.

(3) A record or thing removed under subsection (1) (e) must be returned to the person from whom, or premises from which, it was taken as soon as practicable.

(4) To the extent it is reasonably necessary to facilitate an investigation, an investigator authorized under subsection (1) may

(a) mark a record or thing produced or removed for identification, or

(b) use or alter a record or thing produced or removed.

Uncooperative witness liable for contempt

53 On application by the commission to the Supreme Court, a witness summoned under section 50 (1) (a) is liable to be committed for contempt, as if in breach of an order or judgment of the Supreme Court, if the witness neglects or refuses to

(a) attend,

(b) give evidence under section 50 (1) (b), or

(c) produce a record or thing in the custody, possession or control of the witness.

Additional powers from court

54 (1) The Supreme Court may make an order authorizing a person named in the order to

(a) enter into a premises or place described in subsection (3) at any reasonable time,

(b) review any record or thing at the premises or place that reasonably relates to the order made under section 49,

(c) require a person at the premises or place to produce information, a record or thing, or a class of records or things, that reasonably relates to the order made under section 49 and that is in the custody, possession or control of the person,

(d) copy any record at the premises or place that reasonably relates to the order made under section 49, and

(e) on giving a receipt, remove from the premises or place any record or thing that reasonably relates to the order made under section 49.

(2) If a person enters premises under subsection (1), the person must present proof of his or her authority to do so.

(3) The court may make an order under subsection (1)

(a) on application by the commission, and

(b) on being satisfied by information on oath that there are reasonable and probable grounds to believe that there may be a record or thing that reasonably relates to an order made under section 49

(i) in business premises, or

(ii) in a building, receptacle or place, other than a room or place actually being used as a residence.

(4) An application under subsection (1) may be made without notice and heard in the absence of the public, unless the court otherwise directs.

(5) A record or thing removed under subsection (1) (e) must be returned to the person from whom, or premises or place from which, it was taken as soon as practicable.

(6) To the extent reasonably necessary to facilitate the investigation, an investigator authorized by an order made under subsection (1) may

(a) mark for identification a record or thing produced or removed, or

(b) use or alter a record or thing produced or removed.

Order to freeze property

55 (1) If the commission considers it necessary and in the public interest to do so, the commission may, for the administration of this Act and the regulations or to assist in the administration of the securities laws of another jurisdiction, by order,

(a) direct a person having on deposit, under control or for safekeeping any funds, securities or other property of the person named in the order to hold them until a further order is made by the commission, or

(b) direct a person

(i) not to withdraw any funds, securities or other property from any person having them on deposit, under control or for safekeeping, or

(ii) to hold all funds, securities or other property of a client of that person, or of others, in the person's possession or control in trust for a receiver, receiver manager, trustee or liquidator appointed under an enactment of British Columbia or Canada.

(2) If an order is made under subsection (1) in relation to a savings institution, the order does not apply to an office, branch or agency of the savings institution unless the office, branch or agency is named in the order.

(3) Unless expressly stated, an order made under subsection (1) does not apply to funds, securities or other property at a clearing agency, or to securities in process of transfer by a transfer agent.

(4) The commission may notify a land title office or gold commissioner in writing that proceedings are being, or are about to be, taken that may affect land or a mining claim in which the person named in the notice has a legal or beneficial interest.

(5) A copy of a notice sent under subsection (4), or any variation or revocation of it,

(a) must be registered or recorded against the land or mining claim referred to in the notice, and

(b) has the same effect as a registration or recording of a certificate of pending litigation.

Evidence not to be disclosed

56 (1) Without the consent of the commission, a person must not disclose any information or evidence obtained or sought to be obtained, or the name of any witness examined or sought to be examined, under section 50, 52 or 54.

(2) Despite subsection (1), a person may disclose information or evidence obtained or sought to be obtained, or the name of any witness examined or sought to be examined, to the person's counsel.

Freedom of Information and Protection of Privacy Act

57 (1) If there is a conflict between the Freedom of Information and Protection of Privacy Act and section 56, section 56 prevails.

(2) Subsection (1) does not apply to section 44 (2) and (3) [commissioner may require records to be produced] of the Freedom of Information and Protection of Privacy Act.

(3) Subsection (1) does not apply to personal information, as defined in the Freedom of Information and Protection of Privacy Act, that has existed for 100 or more years or to other information that has existed for 50 or more years.

Investigation order by minister

58 (1) The minister may, by order, appoint a person to make an investigation the minister considers expedient

(a) for the administration of this Act or the regulations, or

(b) to assist in the administration of the securities laws of another jurisdiction.

(2) In an order made under subsection (1), the minister must specify the scope of the investigation.

 
Division 4 -- Enforcement Orders

Commission enforcement orders

59 (1) If the commission considers it in the public interest to do so, the commission may, after a hearing,

(a) order a person to comply with

(i) this Act, the regulations or a commission decision, or

(ii) the regulatory instruments or a decision of a person recognized under section 7,

(b) order a person, a class of persons or all persons to cease trading a security, a class of securities or all securities,

(c) order that any or all of the exemptions in this Act or the regulations do not apply to a person,

(d) prohibit a person from

(i) acting as a director or officer of another person,

(ii) acting as a fund manager,

(iii) acting as a dealer, adviser or representative,

(iv) acting as a due-diligence provider,

(v) acting in a management or consultative capacity in connection with activities in the securities market, or

(vi) promoting the trade of a security or of securities generally,

(e) impose conditions or restrictions on a registration, or suspend or revoke a registration,

(f) restrict the trading or advising activities of a registrant or a person exempt from registration,

(g) order a person to change a record,

(h) order a person to disseminate information or a record,

(i) order a person not to disseminate information or a record, or

(j) order a person that is a market participant to make changes to its practices and procedures.

(2) The commission may, after providing an opportunity to be heard, make an order under subsection (1) (a) to (f) against a person if the person

(a) has been convicted of a criminal offence arising from a transaction, business or course of conduct related to securities,

(b) has been found by a court in or outside British Columbia to have contravened this Act, the regulations or the securities laws of another jurisdiction, or

(c) has been found by a regulator in another province to have contravened the securities laws of the province.

(3) If the commission considers it necessary and in the public interest to do so, the commission may, without providing an opportunity to be heard, make an order under subsection (1), other than an order under subsection (1) (g), (h) or (j), that is effective for not more than 15 days.

(4) If the commission considers it necessary and in the public interest to do so, the commission may, without providing an opportunity to be heard, extend an order made under subsection (3) until

(a) a hearing under subsection (1) is held, or

(b) an opportunity to be heard under subsection (2) is provided,

and the commission makes a decision.

(5) If the commission makes an order under this section, the commission must send the order to each person named in the order.

(6) If the commission sends an order made under subsection (3) or (4), the commission must send a notice of hearing, or a notice of opportunity to be heard, with the order.

Administrative penalty

60 If the commission considers it in the public interest to do so, the commission may, after a hearing, order a person to pay the commission an administrative penalty of not more than $1 million for each contravention of this Act or the regulations.

Removal of benefits

61 If the commission considers it in the public interest to do so, the commission may, after a hearing, order a person to pay to the commission any amount obtained, or payment or loss avoided, as a result of a contravention of this Act or the regulations.

Payment of investigation and hearing costs

62 (1) After providing an opportunity to be heard, the commission may order a person subject to a hearing to pay prescribed fees or prescribed charges for the costs of the commission's investigation, the hearing and related costs.

(2) If a person is found guilty of an offence, the commission may, after providing an opportunity to be heard, order the person to pay prescribed fees or prescribed charges for the costs of the commission's investigation carried out in relation to the offence.

Demand on third party

63 (1) If a person owes money to the commission as a result of an order made under section 60, 61 or 62, and a third party is or is about to become indebted to the person, the commission may demand of the third party that the money owed to the person be paid to the commission on account of the person's indebtedness to the commission.

(2) A copy of a demand under subsection (1) must be delivered to the person that is indebted to the commission.

(3) A third party under subsection (1) must pay the money demanded under that subsection to the commission as soon as practicable after the later of

(a) the receipt of the demand, and

(b) the date the money is due to be paid to the person named in the demand.

(4) Money paid to the commission under this section discharges the indebtedness of the third party to the person named in the demand to the extent of the amount of money paid to the commission.

(5) If, after receipt of a demand under this section, a third party

(a) fails to pay the money to the commission as required under subsection (3), or

(b) makes a payment to the person named in the demand,

the third party is liable to the commission for the lesser of

(c) the third party's indebtedness to the person plus the amount of the indebtedness paid by the third party to the person, and

(d) the amount owed to the commission by the person, including any interest and penalty.

Orders on application of interested person

64 (1) If an interested person believes that another person has contravened this Act or the regulations, the interested person may apply for leave from a commissioner for a hearing to be held under section 59.

(2) The commissioner considering an application under section (1) may grant leave if the commissioner considers it in the public interest to do so.

(3) A commissioner making a decision under this section is not required to provide reasons for the decision.

 
Part 8 -- Hearings and Reviews

Authority of commission

65 (1) At a hearing the commission has the same power as the Supreme Court has for the trial of civil actions to

(a) summon the attendance of a witness,

(b) compel a witness to give evidence, and

(c) compel a witness to produce a record or thing, or a class of records or things, in the custody, possession or control of the witness.

(2) Despite section 34 (5) of the Evidence Act [financial institution not compellable], no financial institution, as defined in that section, and no officer or employee of a financial institution, is exempt from the operation of this section.

(3) At a hearing, the commission

(a) must receive all relevant evidence that a party submits, and

(b) is not bound by the rules of evidence.

(4) The commission may decide all questions of fact or law arising in the course of a hearing.

Joint hearing

66 The commission may hold a hearing in or outside British Columbia in conjunction with any other regulator, and may consult with that regulator during the course of the hearing.

Public attendance

67 A hearing must be open to the public, unless the commission orders that some or all of the hearing be held in private to protect a substantial and compelling privacy interest of one or more of the persons attending the hearing.

Commissioner may not hear matter

68 Unless the parties consent, a commissioner may not hear a matter in relation to which the commissioner previously exercised a power or performed a duty under any of the following:

(a) section 49 [investigation order];

(b) section 52 [entry of premises and production of records];

(c) section 55 [order to freeze property];

(d) section 56 [evidence not to be disclosed];

(e) section 62 [payment of investigation and hearing costs];

(f) section 71 [appointment of receiver, etc.];

(g) section 80 [court orders].

Committal for contempt

69 (1) On application by the commission to the Supreme Court, a witness summoned under section 65 (1) (a) is liable to be committed for contempt, as if in breach of an order or judgment of the Supreme Court, if the witness neglects or refuses to

(a) attend,

(b) give evidence under section 65 (1) (b), or

(c) produce a record or thing in the custody, possession or control of the witness.

(2) If a person's conduct in or in relation to a hearing required or permitted under this Act would be conduct in contempt of the Supreme Court if done in relation to a hearing of that court, the person is liable, on application by the commission to the Supreme Court, to be committed for contempt as if the person were in breach of an order or judgment of the court.

Review of decision

70 (1) The commission may hold a hearing to review a decision of

(a) a person recognized under section 7, in relation to a decision the person has made under a regulatory instrument, or

(b) a person acting under an authority delegated under section 159 [delegation to marketplace, etc.].

(2) The commission must hold a hearing to review a decision of a person referred to in subsection (1) (a) or (b), if a person directly affected by the decision requests a review within 30 days of the decision and provides a copy of the request to the decision maker and the commission.

(3) The commission must hold a hearing to review a decision it has made, other than a decision made by the commissioners, a panel of commissioners appointed under section 138 or a commissioner under section 64, if a person directly affected by the decision requests a review within 30 days of the decision.

(4) The executive director is a party to a review under this section.

(5) A person referred to in subsection (1) (a) or (b) is a party to a review under this section in relation to a decision it has made.

(6) After reviewing a decision, the commission may confirm, vary or revoke the decision or make another decision it considers proper.

(7) The commission may grant a stay of a decision under review.

 
Part 9 -- Powers of the Courts

 
Division 1 -- Receivers

Appointment of receiver, receiver manager,
trustee or liquidator

71 (1) The commission may apply to the Supreme Court for the appointment of a receiver, receiver manager, trustee or liquidator of all or any part of the real and personal property of a person.

(2) The court may appoint a receiver, receiver manager, trustee or liquidator if the court is satisfied that it is

(a) in the best interests of the person's creditors,

(b) in the best interests of other persons whose property is in the possession or under the control of the person,

(c) in the best interests of securityholders or clients of the person, or

(d) appropriate for the administration of this Act and the regulations.

(3) The commission may apply under this section without notice to any other person, and the court may, without a hearing, make a temporary order under subsection (2) for not more than 15 days.

Powers of receivers, receiver managers,
trustees and liquidators

72 A receiver, receiver manager, trustee or liquidator appointed under section 71

(a) is the receiver, receiver manager, trustee or liquidator of all or any part of the property belonging to the person that is the subject of the order, or held by the person on behalf of or in trust for any other person, and

(b) may, if authorized by the court, wind up or manage the business and affairs of the person that is the subject of the order and may exercise any power necessary or incidental to the winding up or management.

 
Division 2 -- Interjurisdictional Evidence

Commission request for evidence

73 (1) On application by the commission, if it appears to the Supreme Court that a person outside British Columbia may have evidence that may be relevant to

(a) an investigation ordered by the commission under section 49 [investigation order], or

(b) a hearing required or permitted under this Act or the regulations,

the Supreme Court may issue a letter of request directed to the judicial authority of the jurisdiction in which the person to be examined is believed to be located.

(2) The letter of request referred to in subsection (1) must be

(a) signed by a judge of the Supreme Court, and

(b) provided to the commission for use under subsection (5).

(3) A letter of request issued under subsection (1) may request the judicial authority to which it is directed to

(a) order the person referred to in the letter of request to be examined under oath in the manner, at the place and by the date referred to in the letter of request,

(b) in the case of an examination for the purposes of a hearing referred to in subsection (1) (b), order that a person that is a party to the hearing is entitled to

(i) be present or represented by counsel during the examination, and

(ii) examine the person referred to in paragraph (a),

(c) appoint a person as the examiner to conduct the examination,

(d) order the person to be examined to produce at the examination a record or thing specified in the letter of request,

(e) direct that the evidence obtained by the examination be recorded and certified in the manner specified by the letter of request, and

(f) take any other action that the Supreme Court considers appropriate.

(4) The failure of a person entitled under subsection (3) (b) to be present or represented by counsel during the examination or to examine the person referred to in subsection (3) (a) does not prevent the commission from reading in the evidence from the examination at the hearing, if the examination has otherwise been conducted in accordance with the order made under subsection (1).

(5) The commission must send the letter of request,

(a) if the examination is to be held in Canada, to the Deputy Attorney General for the Province of British Columbia, or

(b) if the examination is to be held outside Canada, to the Under Secretary of State for Foreign Affairs of Canada.

(6) The letter of request must have attached to it

(a) any questions to be put to the person to be examined,

(b) if known, the name, address and telephone number of

(i) the solicitor or agent of the commission,

(ii) the person to be examined, and

(iii) if applicable, the person entitled under subsection (3) (b) to be present or represented by counsel during the examination, and

(c) a translation of the letter of request and any questions into the official language of the jurisdiction where the examination is to take place, if necessary, along with a certificate of the translator, bearing the full name and address of the translator, that the translation is a true and complete translation.

(7) The commission must file with the Deputy Attorney General for the Province of British Columbia or with the Under Secretary of State for Foreign Affairs of Canada, as the case may be, an undertaking to be responsible for any charge and expense incurred by them in relation to the letter of request and to pay them on receiving notification from them of the amount.

(8) This section does not limit any power the commission may have to obtain evidence outside British Columbia by any other means.

(9) The making of an order by a judicial authority in accordance with a letter of request issued under subsection (1) does not determine whether evidence obtained under the order is admissible in evidence in a hearing before the commission.

(10) Unless otherwise provided by this section, the practice and procedure for appointing a person, conducting an examination, and certifying and returning the appointment under this section, as far as possible, is the same as the practice and procedure that govern similar matters in civil proceedings in the Supreme Court.

Extrajurisdictional request for evidence

74 (1) In this section, "qualifying letter of request" means a letter of request that

(a) is issued by a court or tribunal of competent jurisdiction outside British Columbia,

(b) is issued on behalf of a regulator in the jurisdiction from which the letter is issued,

(c) is issued in relation to

(i) a matter under investigation by the regulator referred to in paragraph (b), or

(ii) a matter that is the subject of a hearing before the regulator referred to in paragraph (b), and

(d) requests that evidence in relation to a matter referred to in paragraph (c) be obtained from a person believed to be located in British Columbia.

(2) On receipt of a qualifying letter of request, the Supreme Court may make the order it considers appropriate, including, without limitation,

(a) order that the person referred to in subsection (1) (d) be examined under oath in the manner, at the place and by the date requested by the court or tribunal referred to in subsection (1) (a),

(b) order, in the case of an examination for the purposes of a hearing referred to in subsection (1) (c) (ii), that a person that is a party to the hearing is entitled to

(i) be present or represented by counsel during the examination, and

(ii) examine the person referred to in paragraph (a),

(c) appoint a person as the examiner to conduct the examination,

(d) order that the person referred to in subsection (1) (d) produce at the examination any record or thing, or class of records or things, specified in the request,

(e) direct that the evidence obtained by the examination be recorded and certified in the manner requested, and

(f) make any further or other order that the Supreme Court considers appropriate.

(3) An order made under subsection (2) may be enforced in the same manner as if the order were made in or in relation to a proceeding brought in the Supreme Court and, if the person referred to in subsection (1) (d) fails without lawful excuse to comply with the order, the person is in contempt of the Supreme Court and is subject to the penalty that the Supreme Court imposes.

(4) A person ordered to give evidence under subsection (2) has the same right to

(a) receive conduct money or any other money that the person would have received if the examination were held in relation to a proceeding in the Supreme Court, and

(b) refuse to answer questions or produce a record or thing that the person would have in a proceeding in the Supreme Court.

(5) The person appointed under subsection (2) (c) as the examiner may administer an oath or affirmation to the person to be examined.

(6) Unless otherwise provided by this section, the practice and procedure in connection with appointing an examiner, conducting an examination, and certifying and returning the appointment under this section, as far as possible, is the same as the practice and procedure that governs similar matters in civil proceedings in the Supreme Court.

 
Division 3 -- Appeals of Commission Decisions

Appeal of commission decision

75 (1) A person directly affected by a decision of the commission may appeal to the Court of Appeal with leave of a justice of that court.

(2) Subsection (1) does not apply to a decision that may be reviewed under section 70 or to a decision made under

(a) section 12 [commission's powers over marketplaces, etc.],

(b) section 64 [orders on application of interested person],

(c) section 70 in relation to the review of a decision under section 151 [discretionary exemptions], or

(d) section 151.

Stay may be granted

76 The commission or the Court of Appeal may grant a stay of a decision under appeal.

Commission power

77 Despite an order of the Court of Appeal in a matter, the commission may make a further decision if there is new evidence or if there is a significant change in the circumstances.

Standing

78 The commission is a respondent to an appeal under this Division.

 
Division 4 -- Additional Remedies

Enforcement of commission decisions

79 If the commission

(a) makes a decision after a hearing, and

(b) files it with the Supreme Court,

the decision has the same force and effect, and all proceedings may be taken on it, as if it were a judgment of the Supreme Court.

Court orders

80 On application by the commission, if the Supreme Court is satisfied that a person has contravened this Act or the regulations, the court may make any interim or final order it considers appropriate, including, without limitation, an order that

(a) the person comply with this Act, the regulations or a decision under this Act,

(b) a trade is set aside,

(c) the person issue, cancel, purchase, exchange or dispose of a security,

(d) the person is prohibited from voting or exercising any other right attaching to a security,

(e) another person is appointed as a director or officer of the person in place of, or in addition to, one or more existing directors or officers of the person,

(f) the person repay to a securityholder money paid by the securityholder for a security,

(g) the person correct a record,

(h) the person compensate or make restitution to another person,

(i) the person pay general or punitive damages to another person,

(j) the person pay to the commission any amount obtained, or payment or loss avoided, as a result of the contravention of this Act or the regulations, or

(k) the person rectify any contravention of this Act or the regulations to the extent that rectification is possible.

 
Division 5 -- Offences

Offences

81 A person commits an offence if the person contravenes any of the following:

(a) section 14 [registration requirement];

(b) section 18 [offering of securities];

(c) section 23 [disclosure of all material information by public issuer];

(d) section 24 [disclosure of significant change by public mutual fund];

(e) sections 25 and 26 [initial and subsequent insider reports];

(f) section 27 [manipulation and fraud];

(g) section 28 [misrepresentation];

(h) section 29 [unfair practice];

(i) section 30 [insider trading, tipping and recommending];

(j) section 31 [front running];

(k) section 36 [duty to comply with decision];

(l) section 37 [duty to comply with undertaking];

(m) section 40 [false or misleading statements to commission];

(n) section 41 [obstruction of justice];

(o) section 56 [evidence not to be disclosed];

(p) a regulation specified by the Lieutenant Governor in Council.

Offence Act

82 Section 5 of the Offence Act does not apply to this Act or the regulations.

Penalties

83 (1) A person that commits an offence under this Act is liable to a fine of not more than $3 million, or to imprisonment for not more than 3 years, or both.

(2) Despite subsection (1), if a person commits an offence by contravening section 27 [manipulation and fraud], 30 [insider trading, tipping and recommending] or 31 [front running], the fine to which that person is liable is

(a) not less than any profit made by any person because of the contravention, and

(b) not more than the greater of

(i) $3 million, and

(ii) an amount equal to triple the profit made by any person because of the contravention.

(3) For the purposes of subsection (2), "profit" means the amount determined in accordance with the regulations.

Additional remedies

84 If the court finds that a person has committed an offence under section 81, the court may make an order that

(a) the person compensate or make restitution to another person, or

(b) the person pay to the commission any amount obtained, or payment or loss avoided, as a result of the offence.

Enforcement of restitution or compensation orders

85 (1) The person to whom the compensation or restitution was ordered to be paid under section 84 (a) may file the order with the Supreme Court.

(2) An order filed with the Supreme Court under subsection (1) has the same effect as if it were a judgment of that court.

Execution of warrant issued in another Canadian jurisdiction

86 (1) If a court of another province issues a warrant for the arrest of a person on a charge of contravening provisions of the securities laws of that other province, a British Columbia court within whose territorial jurisdiction that person is or is suspected to be may, on satisfactory proof of the handwriting of the person that issued the warrant, make an endorsement on the warrant.

(2) A warrant endorsed under subsection (1) is sufficient authority for

(a) the person bringing the warrant,

(b) any other person to whom it was originally directed, and

(c) any peace officer within the territorial jurisdiction of the British Columbia court that endorsed the warrant,

to execute the warrant within that territorial jurisdiction, to take the person arrested under the warrant out of or anywhere in British Columbia, and to re-arrest that person anywhere in British Columbia.

(3) A peace officer

(a) of British Columbia, or

(b) of any other province who is passing through British Columbia,

having in the peace officer's custody a person arrested in another province under a warrant endorsed under subsection (1), is entitled to hold, take and re-arrest the person anywhere in British Columbia under the warrant without proof of the warrant or the endorsement.

 
Part 10 -- Investor Remedies

Definitions

87 In this Part:

"bid document" means a document that is

(a) prepared by an offeror in relation to a takeover bid or issuer bid, and

(b) within a prescribed class of documents;

"issuer bid" means an offer for a security that is

(a) made by the issuer of the security, and

(b) within a prescribed class of offers;

"offeror" includes a person acting in concert with another person to effect a takeover bid;

"related security" means a security

(a) in relation to which the value, market price or payment obligations are derived from or based on a security of the issuer, and

(b) that is created by a person on behalf of the issuer or is guaranteed by the issuer;

"takeover bid" means an offer for a security that is

(a) made by a person other than the issuer of the security, and

(b) within a prescribed class of offers.

 
Division 1 -- Rights of Action

Actions under Division 5 only

88 (1) If a person is a party to an action under Division 5, the person has no right of action under this Division in relation to the same matter.

(2) For the purposes of subsection (1), "party" includes a member of a class in an action brought under the Class Proceedings Act, if the person has not opted out of the proceeding under section 16 of that Act.

Application

89 Sections 90, 91, 93 and 94 apply to a misrepresentation in

(a) a document that is filed or is otherwise generally disclosed, or

(b) an oral statement, if general disclosure of the statement was reasonably foreseeable at the time it was made.

Damages for misrepresentation by a public issuer

90 (1) Subject to subsection (5), if

(a) a public issuer, or

(b) any other issuer whose securities are publicly traded

makes a misrepresentation, a person that trades a security of the issuer, or a related security, during the period referred to in subsection (2) has a right of action for damages against a person referred to in subsection (3) or (4).

(2) A person may recover damages under this section in relation to a trade of a security of the issuer, or a related security, if the trade was made during the period

(a) starting when the misrepresentation was generally disclosed or when a document containing the misrepresentation was filed, whichever occurred first, and

(b) ending when the correction of the misrepresentation is generally disclosed.

(3) An action under subsection (1) may be brought against any of the following:

(a) the issuer;

(b) a person that was a director of the issuer at the time the misrepresentation was made;

(c) a person that was an officer of the issuer at the time the misrepresentation was made, if the person authorized, permitted or acquiesced in the making of the misrepresentation;

(d) a person that made an oral statement that contained the misrepresentation, if the person had express or implied authority to represent the issuer;

(e) a person that was a significant securityholder of the issuer at the time the misrepresentation was made, if the securityholder influenced the making of the misrepresentation;

(f) a person that was a director or officer of the significant securityholder referred to in paragraph (e) at the time the misrepresentation was made, if the person influenced the making of the misrepresentation;

(g) an expert, if

(i) the expert made the misrepresentation in an opinion or report that was generally disclosed or filed by the issuer, or was referred to in or incorporated into a document, or oral statement, that was generally disclosed or filed by the issuer,

(ii) the expert provided to the issuer the expert's written consent to the general disclosure or filing of the opinion or report, and

(iii) the expert had not, in writing, withdrawn the consent referred to in subparagraph (ii) before the misrepresentation was generally disclosed or before a document containing the misrepresentation was filed, whichever occurred first.

(4) If the trade referred to in subsection (1) was made under a public offering, an action under that subsection may be brought against a person referred to in subsection (3) and

(a) a person that was a due-diligence provider in relation to the public offering, or

(b) a person that was an underwriter in relation to the public offering if there was no due-diligence provider in relation to the public offering.

(5) Subsection (1) does not apply if the misrepresentation is contained in a document referred to in section 100 or 101.

Misrepresentation by a significant securityholder

91 (1) If a significant securityholder makes a misrepresentation about

(a) a public issuer, or

(b) any other issuer whose securities are publicly traded,

a person referred to in subsection (2) has a right of action for damages against a person referred to in subsection (3).

(2) A person may recover damages under this section in relation to a trade of a security of the issuer, or a related security, if the trade was made during the period

(a) starting when the misrepresentation was generally disclosed or when a document containing the misrepresentation was filed, whichever occurred first, and

(b) ending when the correction of the misrepresentation is generally disclosed.

(3) An action under subsection (1) may be brought against any of the following:

(a) the significant securityholder;

(b) a person that was a director of the significant securityholder at the time the misrepresentation was made;

(c) a person that was an officer of the significant securityholder at the time the misrepresentation was made, if the person authorized, permitted or acquiesced in the making of the misrepresentation;

(d) the issuer, if a director or officer of the issuer authorized, permitted or acquiesced in the making of the misrepresentation;

(e) a person that was a director or officer of the issuer referred to in paragraph (d) at the time the misrepresentation was made, if the person authorized, permitted or acquiesced in the making of the misrepresentation;

(f) a person that made an oral statement about the business or affairs of the issuer that contained the misrepresentation, if the person had express or implied authority to represent the significant securityholder;

(g) an expert, if

(i) the expert made the misrepresentation in an opinion or report that was generally disclosed or filed by the significant securityholder, or was referred to in or incorporated into a document, or oral statement, that was generally disclosed or filed by the significant securityholder,

(ii) the expert provided to the significant securityholder the expert's written consent to the general disclosure or filing of the opinion or report, and

(iii) the expert had not, in writing, withdrawn the consent referred to in subparagraph (ii) before the misrepresentation was generally disclosed or before a document containing the misrepresentation was filed, whichever occurred first.

Failure to make timely disclosure by public issuer

92 (1) If a public issuer fails to disclose material information as required under section 23, a person referred to in subsection (2) has a right of action for damages against a person referred to in subsection (3).

(2) A person may recover damages under this section in relation to a trade of a security of the issuer, or a related security, if the trade was made during the period

(a) starting when the material information was required to be disclosed, and

(b) ending when the information is generally disclosed.

(3) An action under subsection (1) may be brought against any of the following:

(a) the issuer;

(b) a person that was a director of the issuer at the time the issuer was required to disclose the material information;

(c) a person that was an officer of the issuer at the time the issuer was required to disclose the material information, if the person authorized, permitted or acquiesced in the failure to disclose the material information;

(d) a person that was a significant securityholder at the time the issuer was required to disclose the material information, if the person influenced the failure to disclose the material information;

(e) a person that was a director or officer of a significant securityholder, at the time the issuer was required to disclose the material information, if the person influenced the failure to disclose the material information.

Damages for misrepresentation by public mutual fund

93 (1) Subject to subsection (4), if a public mutual fund makes a misrepresentation, or if a fund manager of a public mutual fund makes a misrepresentation about the mutual fund, a person that trades a security of the mutual fund, or a related security, during the period referred to in subsection (2) has a right of action for damages against a person referred to in subsection (3).

(2) A person may recover damages under this section in relation to a trade of a security of the mutual fund, or a related security, if the trade was made during the period

(a) starting when the misrepresentation was generally disclosed or when a document containing the misrepresentation was filed, whichever occurred first, and

(b) ending when the correction of the misrepresentation is generally disclosed.

(3) An action under subsection (1) may be brought against any of the following:

(a) the fund manager;

(b) a person that was a director of the fund manager at the time the misrepresentation was made;

(c) a person that was an officer of the fund manager at the time the misrepresentation was made, if the person authorized, permitted or acquiesced in the making of the misrepresentation;

(d) a person that made an oral statement that contained the misrepresentation, if the person had express or implied authority to represent the mutual fund or the fund manager;

(e) an expert, if

(i) the expert made the misrepresentation in an opinion or report that was generally disclosed or filed by the mutual fund or fund manager, or was referred to in or incorporated into a document, or oral statement, that was generally disclosed or filed by the mutual fund or fund manager,

(ii) the expert provided to the mutual fund or fund manager the expert's written consent to the general disclosure or filing of the opinion or report, and

(iii) the expert had not, in writing, withdrawn the consent referred to in subparagraph (ii) before the misrepresentation was generally disclosed or before a document containing the misrepresentation was filed, whichever occurred first.

(4) Subsection (1) does not apply if the misrepresentation is contained in a document referred to in section 100 or 101.

Rescission for misrepresentation by public mutual fund

94 (1) If a public mutual fund makes a misrepresentation, a person that purchased a security of the mutual fund during the period referred to in section 93 (2) has a right of action for rescission against the mutual fund.

(2) If a person is a party to an action under subsection (1), the person has no right of action under section 93 in relation to the same matter.

(3) For the purposes of subsection (2), "party" includes a member of a class in an action brought under the Class Proceedings Act, if the person has not opted out of the proceeding under section 16 of that Act.

Failure to make timely disclosure by a public mutual fund

95 (1) If a public mutual fund fails to disclose a significant change as required under section 24, a person referred to in subsection (2) has a right of action for damages against a person referred to in subsection (3).

(2) A person may recover damages under this section in relation to a trade of a security of the issuer, or a related security, if the trade was made during the period

(a) starting when the significant change was required to be disclosed, and

(b) ending when the change is generally disclosed.

(3) An action under subsection (1) may be brought against any of the following:

(a) the fund manager of the mutual fund;

(b) a person that was a director of the fund manager at the time the mutual fund was required to disclose the significant change;

(c) a person that was an officer of the fund manager at the time the mutual fund was required to disclose the significant change, if the person authorized, permitted or acquiesced in the failure to disclose the significant change.

Damages for misrepresentation in prescribed disclosure document

96 (1) If an issuer, other than an issuer referred to in section 90 (1) or 93 (1), makes a misrepresentation in a prescribed disclosure document prepared in connection with an offering, a person that purchases a security under the offering has a right of action for damages against a person referred to in subsection (2).

(2) An action under subsection (1) may be brought against any of the following:

(a) the issuer;

(b) a person that was a director of the issuer at the time the misrepresentation was made;

(c) a person that was an officer of the issuer at the time the misrepresentation was made, if the person authorized, permitted or acquiesced in the making of the misrepresentation.

Rescission for misrepresentation in
prescribed disclosure document

97 (1) If an issuer, other than an issuer referred to in section 90 (1) or 93 (1), makes a misrepresentation in a prescribed disclosure document prepared in connection with an offering, a person that purchases a security under the offering has a right of action for rescission against the issuer.

(2) If a person is a party to an action under subsection (1), the person has no right of action under section 96 in relation to the same matter.

(3) For the purposes of subsection (2), "party" includes a member of a class in an action brought under the Class Proceedings Act, if the person has not opted out of the proceeding under section 16 of that Act.

Withdrawal right under prescribed disclosure document

98 If an issuer, other than an issuer referred to in section 90 (1) or 93 (1), makes an offering of a security under a prescribed disclosure document, a person that purchases the security under the offering may cancel the purchase by delivering notice to the issuer not later than midnight on the second business day after the purchaser signs the agreement to purchase the securities.

Illegal offering

99 If a person makes an offering in contravention of section 18 [offering of securities], a person that purchased a security under the offering has a right of action for damages or rescission against the person.

Misrepresentation in bid document

100 (1) If a bid document is required to be filed by an offeror, and if the bid document contains a misrepresentation, a person to whom the bid is made has a right of action for damages against a person referred to in subsection (2) if the document is disclosed or filed.

(2) An action under subsection (1) may be brought against any of the following:

(a) the offeror;

(b) a person that was a director of the offeror at the time the misrepresentation was made;

(c) a person that was an officer of the offeror at the time the misrepresentation was made, if the person authorized, permitted or acquiesced in the making of the misrepresentation;

(d) an expert, if

(i) the expert made the misrepresentation in an opinion or report that was disclosed or filed by the offeror, or was referred to in or incorporated into the bid document,

(ii) the expert provided to the offeror the expert's written consent to the disclosure or filing of the opinion or report, and

(iii) the expert had not, in writing, withdrawn the consent referred to in subparagraph (ii) before the disclosure or filing of the bid document.

Misrepresentation by director or officer of takeover target

101 If an issuer is the subject of a takeover bid, and if a director or officer of the issuer makes a misrepresentation in relation to the takeover bid in a document that is required to be filed, a person to whom the bid was made has a right of action for damages against the director, or officer, if the document was disclosed or filed.

Non-compliance with bid requirements

102 (1) In this section, "interested person" means

(a) an issuer that is the subject of a takeover bid,

(b) a securityholder, director or officer of an issuer referred to in paragraph (a),

(c) an offeror, or

(d) any other person who, in the opinion of the Supreme Court, is a proper person to make an application under this section.

(2) An interested person may apply to the Supreme Court for an order under this section.

(3) On an application under subsection (2), if the Supreme Court is satisfied that a person has not complied with the regulations applicable to takeover bids or issuer bids, the Supreme Court may make an interim or final order that the court thinks fit, including, without limitation,

(a) an order for damages suffered as a result of a contravention,

(b) an order rescinding a transaction with an interested person, including a trade of a security,

(c) an order requiring a person to dispose of a security acquired under a takeover bid or an issuer bid,

(d) an order prohibiting a person from exercising voting rights attaching to a security, or

(e) an order requiring the trial of an issue.

Illegal takeover or issuer bid

103 If a bid document is required to be filed but is not filed, a person to whom the bid is made has a right of action for damages or rescission against the offeror.

Damages for trading on inside
information, tipping, recommending

104 (1) If a person is an issuer, or a connected person as defined in section 30 [insider trading, tipping and recommending], and if the person contravenes that section, a person referred to in subsection (2) of this section has a right of action for damages against the issuer or connected person.

(2) A person may recover damages in relation to a trade in a security of the issuer, or a security the value of which is derived from or varies materially with the value or market price of a security of the issuer, if the trade was made during the period

(a) starting when the contravention occurred, and

(b) ending when the inside information is generally disclosed.

Accounting for benefits

105 (1) If a person is an insider, affiliate or associate of a public issuer or of a public mutual fund, and if the person contravenes section 30 [insider trading, tipping and recommending], the person must pay to the public issuer or public mutual fund an amount equal to

(a) the benefit that the person received as a result of the contravention, and

(b) the benefit that any other person received as a result of the contravention.

(2) If a person is a registrant, representative, fund manager or a director or officer of a fund manager, and if the person contravenes section 31 [front running], the person must pay to the mutual fund, or the person to whom the material order information relates, an amount equal to

(a) the benefit that the person received as a result of the contravention, and

(b) the benefit that any other person received as a result of the contravention.

Reliance

106 A person with a right of action under this Part does not have to prove, as the case may be,

(a) that the person relied on the misrepresentation, or

(b) that the person would not have traded a security of the issuer, or a related security, if

(i) the material information or significant change had been disclosed, or

(ii) this Act and the regulations had been complied with.

Multiple misrepresentations

107 In an action under this Division, multiple misrepresentations involving a common subject matter may, in the discretion of the court, be treated as a single misrepresentation.

 
Division 2 -- Defences

Plaintiff's knowledge

108 A person is not liable in an action under any of sections 90 to 97, 100 and 101 if the person proves that, at the time of the trade,

(a) the person bringing the action knew that the statement was a misrepresentation, or

(b) the person bringing the action knew the material information or knew of the significant change.

Reasonable system

109 (1) An issuer or fund manager, or a director of the issuer or fund manager, is not liable under any of sections 90 to 97 if, at the time of the contravention that gave rise to the action, the issuer or fund manager employed a reasonable system to ensure compliance with this Act and the regulations including a process for monitoring the effectiveness of the system.

(2) Subsection (1) does not apply to a director if the director,

(a) at the time of the contravention, knew of the misconduct and that the misconduct was a contravention of this Act, or

(b) was reckless in failing to obtain the knowledge referred to in paragraph (a), or willfully avoided that knowledge.

Due diligence for misrepresentation

110 A person is not liable under section 90, 91, 93, 94, 96, 97, 100 or 101 if the person, after reasonable investigation and at the time the misrepresentation was made, had no reasonable grounds to believe that the statement or omission was a misrepresentation.

Due diligence for failure to disclose

111 A person is not liable under section 92 or 95 if, after a reasonable investigation occurring before the information was required to be disclosed, the person

(a) did not know, and reasonably could not have known, of the material information or significant change,

(b) did not believe, and had no reasonable grounds to believe, that the information was material information or that the change was a significant change, or

(c) did not know, and reasonably could not have known, that the information had not been generally disclosed.

Due diligence for insider trading

112 A person is not liable under section 104 or 105 (1) if, after a reasonable investigation occurring before the person

(a) entered into the trade or transaction,

(b) recommended or encouraged a trade or transaction, or

(c) informed another person of the inside information,

the person had no reasonable grounds to believe that the inside information had not been generally disclosed.

Defence for expert relating to misrepresentation

113 If an expert made a misrepresentation, the expert is not liable under section 90, 91, 93 or 100 if the misrepresentation was based on information provided to the expert and it was reasonable for the expert to rely on that information.

Misrepresentation in information based on expert's report

114 (1) A person, other than an expert, is not liable under section 90, 91, 93 or 100 for a misrepresentation that was based on an expert's opinion or report if

(a) the expert provided written consent to the general disclosure or filing of the expert's opinion or report, and

(b) the person did not know, and reasonably could not have known, that there was a misrepresentation in the opinion or report.

(2) Subsection (1) does not apply if

(a) the misrepresentation was based on false or misleading information provided by the person,

(b) the disclosure did not fairly represent the expert's opinion or report, or

(c) the expert withdrew the consent referred to in subsection (1) (a) before the misrepresentation was generally disclosed or a document containing the misrepresentation was filed, whichever occurred first.

Expectation of confidentiality

115 A person, other than the issuer, fund manager or offeror, is not liable under section 90, 91, 93, 96, 100 or 101 if

(a) the misrepresentation was contained in a document,

(b) the person did not consent to the general disclosure or filing of the document,

(c) the person did not know, and had no reasonable grounds to believe, that the document would be generally disclosed or filed without the person's knowledge or consent, and

(d) as soon as practicable after the person knew or reasonably should have known that the document was generally disclosed or filed, notified in writing the issuer and the commission that the person had not consented to its disclosure or filing.

Disclosure of fact of misrepresentation

116 A person, other than the issuer, fund manager or offeror, is not liable under section 90, 91, 93, 96, 100 or 101 if, as soon as practicable after the person obtained knowledge that a statement was a misrepresentation,

(a) the person

(i) withdrew any consent to the statement's disclosure or filing, and

(ii) gave reasonable general notice of the withdrawal of the consent and the reason for the withdrawal, or

(b) the person gave reasonable general notice that the statement was a misrepresentation.

Forward-looking information

117 A person is not liable for a misrepresentation in forward-looking information if

(a) the information is identified as forward-looking information,

(b) the information states the material factors considered and the assumptions used to develop the forward-looking information, and

(c) the person had a reasonable basis for making the statements contained in the forward-looking information.

Reliance on disclosure by other issuers or public official

118 A person is not liable under section 90, 91, 93, 94, 96, 97, 100 or 101 if, at the time the misrepresentation was made, the person did not know and had no reasonable grounds to believe that a misrepresentation had been made and the source of the misrepresentation was

(a) a document that another issuer filed with the commission, or provided to a regulator or a marketplace, or

(b) a public official document or a statement made by a public official.

 
Division 3 -- Procedure

Court approval to proceed

119 (1) An action under Division 1 may be commenced only with leave of the Supreme Court.

(2) A person applying for leave of the court under subsection (1) must give notice to each person named in the style of proceedings.

(3) The court may grant leave under subsection (1) if it is satisfied that the action has a reasonable prospect of success.

Court approval to settle

120 (1) A proceeding under Division 1 may be settled, discontinued or abandoned only

(a) with the approval of the court, and

(b) on the terms the court considers appropriate.

(2) A settlement under this section is not binding unless approved by the court.

(3) In an application under subsection (1), the court must consider whether a person that is not a party to the application is a party to an action regarding the same misconduct,

(a) under this Part, or

(b) in another province under similar laws,

and the effect that the settlement, and section 121, will have in relation to the other action.

 
Division 4 -- Damages and Liability Limits

Limits on damages

121 (1) Subject to subsection (2) and section 122, if a court finds a person liable in an action under Division 1, the amount payable by the person is the lesser of

(a) the plaintiff's damages, and

(b) the amount determined in accordance with the regulations.

(2) If a court finds a person liable in an action under Division 1, the amount payable by a defendant, other than the issuer, fund manager or offeror, is the amount equal to the plaintiff's damages, if the plaintiff proves that the defendant,

(a) at the time of the contravention, knew of the misconduct and that the misconduct was a contravention, or

(b) was reckless in failing to obtain the knowledge referred to in paragraph (a), or willfully avoided that knowledge.

(3) Subsection (2) does not apply to an action under section 104 [damages for insider trading, tipping and recommending].

Limits on exemplary or punitive damages

122 (1) In an action under Division 1, the court may not award exemplary or punitive damages.

(2) Despite subsection (1), the court may award exemplary or punitive damages against a defendant, other than the issuer, fund manager or offeror, if the plaintiff proves that the defendant,

(a) at the time of the contravention, knew of the misconduct and that the misconduct was a contravention of this Act, or

(b) was reckless in failing to obtain the knowledge referred to in paragraph (a), or willfully avoided that knowledge.

Assessment of damages

123 In an action under Division 1, a court may not award damages for an amount that the defendant proves is attributable to a change in market price of the security that is unrelated to the contravention.

Liability proportionate to misconduct

124 Subject to section 125, section 4 (2) (a) of the Negligence Act [joint and several liability] does not apply to an action under Division 1.

Joint and several liability

125 If, in an action under Division 1, damages are attributable to the misconduct of 2 or more persons including the issuer, fund manager or offeror, section 4 (2) (a) of the Negligence Act applies to a person, other than the issuer, fund manager or offeror, that

(a) knew of the misconduct and that the misconduct was a contravention, or

(b) was reckless in failing to obtain the knowledge referred to in paragraph (a), or willfully avoided that knowledge.

 
Division 5 -- Multijurisdictional Transactions

Prospectus offerings

126 (1) If a person makes a public offering concurrently in British Columbia and under a prospectus in a jurisdiction designated by the commission, and if the prospectus or a document incorporated into the prospectus contains a misrepresentation, a person that purchases a security under the offering has a right of action for damages.

(2) An action for damages under subsection (1) may be brought against any of the following:

(a) the issuer;

(b) if the offering was made in relation to a previously issued security, the selling securityholder under the public offering;

(c) a person that was a director of the issuer at the time of the offering;

(d) a person that was an officer of the issuer at the time of the offering, if the person authorized, permitted or acquiesced in the making of the misrepresentation;

(e) an expert, if

(i) the expert made the misrepresentation in an opinion or report that was referred to or incorporated into the prospectus,

(ii) the expert provided to the issuer the expert's written consent to the disclosure of the opinion or report, and

(iii) the expert had not, in writing, withdrawn the consent referred to in subparagraph (ii) before the offering was made;

(f) an underwriter of the offering.

(3) If the person referred to in subsection (1) purchased a security from the issuer or the underwriter of the offering, the person has a right of action for rescission against the issuer or the underwriter.

(4) If a person is a party to an action under subsection (1), the person has no right of action under subsection (3) in relation to the same matter.

(5) For the purposes of subsection (4), "party" includes a member of a class in an action brought under the Class Proceedings Act, if the person has not opted out of the proceeding under section 16 of that Act.

Takeover or issuer bids

127 (1) If a person makes a takeover bid or issuer bid in British Columbia and in a jurisdiction designated by the commission, a person to whom a bid document was required to be sent under the regulations has a right of action for damages or rescission, if

(a) the bid document is sent and contains a misrepresentation, or

(b) the bid document is not sent to the person as required under the regulations.

(2) An action for damages under subsection (1) (a) may be brought against any of the following:

(a) the offeror;

(b) a person that was a director of the offeror at the time the misrepresentation was made;

(c) a person that was an officer of the offeror at the time the misrepresentation was made, if the person authorized, permitted or acquiesced in the making of the misrepresentation;

(d) an expert, if

(i) the expert made the misrepresentation in an opinion or report that was referred to or incorporated into the bid document,

(ii) the expert provided to the offeror the expert's written consent to the disclosure of the opinion or report, and

(iii) the expert had not, in writing, withdrawn the consent referred to in subparagraph (ii) before the bid document was sent.

(3) An action for damages under subsection (1) (b), and an action for rescission under subsection (1), may be brought against the offeror.

Misrepresentation by director or officer of takeover target

128 If an issuer is the subject of a takeover bid in British Columbia and in another jurisdiction designated by the commission, and if a director or officer of the issuer makes a misrepresentation in a document that is required to be sent to a securityholder under the regulations, a person to whom the document is sent or required to be sent has a right of action for damages against the director or officer.

No alternative remedy

129 (1) If a person is a party to an action under Division 1, the person has no right of action under this Division in relation to the same matter.

(2) For the purposes of subsection (1), "party" includes a member of a class in an action brought under the Class Proceedings Act, if the person has not opted out of the proceeding under section 16 of that Act.

Defences

130 (1) Subject to subsection (8), a person is not liable under section 126 or 127 (1) (a) if the person proves that, at the time of the trade, the person bringing the action knew that the statement was a misrepresentation.

(2) A person is not liable under section 126 or 127 (1) (a) if the person, after reasonable investigation and at the time the misrepresentation was made, had no reasonable grounds to believe that the statement was a misrepresentation.

(3) A person, other than an expert, is not liable for damages under section 126 or 127 (1) (a) for a misrepresentation that was based on an expert's opinion or report if

(a) the expert provided written consent to the disclosure of the expert's opinion or report, and

(b) the person did not know, and reasonably could not have known, that there was a misrepresentation in the opinion or report.

(4) Subsection (3) does not apply if

(a) the person did not fairly represent the expert's opinion or report, or

(b) the expert withdrew the consent referred to in subsection (3) (a) before the misrepresentation was generally disclosed or before a document containing the misrepresentation was filed, whichever occurred first.

(5) A person is not liable for damages under section 126 or 127 (1) (a) if

(a) the misrepresentation was contained in a document,

(b) the person did not consent to the document being disclosed or filed,

(c) the person did not know, and had no reasonable grounds to believe, that the document would be filed or sent without the person's knowledge or consent, and

(d) as soon as practicable after the person knew or reasonably should have known that the document was filed or sent, gave reasonable general notice that the person had not consented to it being filed or sent.

(6) A person is not liable for damages under section 126 or 127 (1) (a) if, after becoming aware that the document contained a misrepresentation, the person withdrew the person's consent to its disclosure and, as soon as practicable, gave reasonable general notice of the withdrawal and the reason for it.

(7) A person is not liable for damages under section 126 or 127 (1) (a) if, at the time the misrepresentation was made, the person did not know and had no reasonable grounds to believe that a misrepresentation had been made and the source of the misrepresentation was a public official document or a statement made by a public official.

(8) Subsections (2) to (7) do not apply to the issuer, selling securityholder or offeror.

Limits on liability

131 (1) In an action under section 126, the court may not award damages for an amount that exceeds the aggregate offering price of the securities purchased by the plaintiff under the offering.

(2) In an action under this Division, the court may not award damages for an amount that the defendant proves is attributable to a change in market price of the security that was unrelated to the misrepresentation.

(3) In an action under this Division, the court may not award damages against an underwriter for any amount exceeding the aggregate offering price of the securities that the underwriter purchased as principal.

 
Division 6 -- General

Limitation periods

132 (1) No action may be commenced under section 90, 91, 92, 93, 95, 96, 100, 101, 104 or 105, and no action may be commenced for damages under section 99 or 103, after the earlier of

(a) 3 years after the date of the contravention,

(b) 6 months after leave was granted to commence the action,

(c) 6 months after leave was granted to another person to commence an action for damages, in relation to the same matter, and

(d) 6 months after leave was granted to commence an action for damages, in relation to the same matter, under corresponding provisions in the securities laws of a jurisdiction designated by the commission.

(2) No action may be commenced for damages under section 126 or 127 after 3 years from the date of the contravention that gave rise to the cause of action.

(3) No action for rescission may be commenced under section 94, 97, 99, 103, 126 or 127 after 6 months from the date of the contravention that gave rise to the right of action.

Additional rights

133 This Part does not modify or extinguish any right a person may have under this Act, another enactment or the common law.

Agreement that conflicts with this Part is void

134 A term in an agreement that is in conflict with this Part, or with the regulations under this Part, is void whether the agreement was entered into before or after this Part came into force.

 
Part 11 -- The British Columbia Securities Commission

 
Division 1 -- Structure

Commission continued

135 (1) The British Columbia Securities Commission is continued as a corporation consisting of up to 11 commissioners appointed as follows by the Lieutenant Governor in Council after a merit based process:

(a) one commissioner designated as the chair and chief executive officer;

(b) one or more commissioners designated as vice chairs after consultation with the chair;

(c) other commissioners appointed after consultation with the chair.

(2) The commission is responsible for the administration of this Act.

(3) The Lieutenant Governor in Council may set the terms and conditions of the appointment of a commissioner.

Application of the Administrative Tribunals
Appointment and Administration Act

136 Sections 1 to 6, 7 (1) and (2) and 8 of the Administrative Tribunals Appointment and Administration Act apply to the commission.

Commission powers generally

137 (1) The commission is an agent of the government.

(2) The commission has the power and capacity of a natural person of full capacity.

(3) The Business Corporations Act does not apply to the commission.

(4) The commission is not liable to taxation, except insofar as the government is liable.

Panels of commission

138 (1) The chair may

(a) appoint 2 or more commissioners to be a panel of the commission,

(b) terminate appointments to a panel, and

(c) except for a panel that has commenced a hearing, fill a vacancy on a panel.

(2) The chair may refer a matter that is

(a) before the commission to a panel, and

(b) before a panel to the commission or to another panel.

(3) The chair may establish one or more panels of the commission and, in matters referred to a panel by the chair, a panel has the powers of the commission.

Executive director

139 The commission must appoint an executive director to be the chief administrative officer of the commission.

Officers and employees

140 The commission may

(a) appoint officers and employees of the commission necessary to enable the commission to exercise its powers and perform its duties under this Act,

(b) define the duties of the officers and employees, and

(c) determine the remuneration of its commissioners, and the remuneration and classification of the officers and employees.

Expenses

141 The commission must reimburse a commissioner, officer or employee for any reasonable expense necessarily incurred by them in the performance of their duties.

 
Division 2 -- Financial Operations

Minister defined

142 In this Division, "minister" means the minister responsible for the administration of the Financial Administration Act.

Financial Administration Act

143 Section 12 of the Financial Administration Act does not apply to money received by the commission.

Revenue and expenditure

144 (1) Subject to subsection (2), money payable under this Act, including but not limited to money received from administrative penalties under section 60 [administrative penalty] and any cost recoveries under this Act, must be paid to the commission.

(2) Fines assessed under section 83 [penalties] must be paid to the consolidated revenue fund.

(3) Subject to subsection (4), money received by the commission may be expended for any costs involved in the administration and enforcement of this Act and for any costs involved in operating the commission.

(4) Subject to subsection (5), money received by the commission under

(a) section 60 [administrative penalty],

(b) section 61 [commission ordered removal of benefits],

(c) section 80 (j) [court ordered removal of benefits],

(d) section 84 (b) [removal of benefits after offence proven], or

(e) a settlement of a matter relating to a contravention or alleged contravention under this Act, excluding an amount designated in the settlement as

(i) a cost recovery, or

(ii) an allocation to or for the benefit of a third party,

may be expended only for the purpose of educating market participants and members of the public about investing, financial matters or the operation or regulation of securities markets.

(5) The commission may not expend money received under section 61, 80 (j) or 84 (b), unless the period referred to in subsection 145 (5) has expired.

Claim for wrongful benefit

145 (1) If the commission receives money from an order made under

(a) section 61,

(b) section 80 (j), or

(c) section 84 (b),

the commission must notify the public in the manner prescribed by the Lieutenant Governor in Council.

(2) A person that makes a claim to money held by the commission under this section must file the claim in the Supreme Court within 3 years from the date of the first notification made under subsection (1) and file a copy of the claim with the commission.

(3) If the commission receives a copy of a claim under subsection (2), it must pay into court all of the money the commission has received under subsection (1) in relation to that order.

(4) If the commission has paid money into court under subsection (3), any money remaining after the court has adjudicated all claims made under subsection (2) in relation to the money must be paid to the commission.

(5) After 3 years from the date of the first notification made under subsection (1), the commission may retain any money not claimed under subsection (2).

Fiscal agent

146 The minister is the fiscal agent of the commission.

Investment

147 (1) The commission must place with the minister, for investment, any money the commission receives but does not immediately require for the administration of this Act.

(2) Money placed with the minister under subsection (1) is to be treated for all purposes as money placed with the minister under section 40 (5) of the Financial Administration Act.

Borrowing powers

148 Subject to the approval of the Lieutenant Governor in Council, the commission, for the purpose of carrying out any power, right, function or duty conferred or imposed on the commission under this or any other Act, may borrow the sums of money the commission considers necessary or advisable.

Accounting

149 (1) The commission must establish and maintain accounting policies and systems satisfactory to the minister.

(2) The commission must prepare annual and quarterly financial statements in accordance with generally accepted accounting principles.

(3) Unless the Auditor General is appointed in accordance with the Auditor General Act as the auditor of the commission, the commission must appoint an auditor to audit the accounts of the commission at least once each year.

(4) The remuneration of an auditor for auditing the accounts of the commission must be paid by the commission.

(5) Whenever the minister requires, the commission must prepare and provide to the minister detailed accounts of the commission's revenues and expenditures for the period the minister designates.

(6) All financial records and statements must at all times be open for inspection by the minister or a person designated by that minister.

(7) The chair of Treasury Board may direct the Comptroller General to examine and report to Treasury Board on the financial and accounting operations of the commission.

Administrative services

150 The Lieutenant Governor in Council may designate administrative services that the commission must obtain from the government or from an agent of government or other government entity.

 
Division 3 -- Orders

Discretionary exemptions

151 If the commission considers it not prejudicial to the public interest to do so, the commission may exempt a person, trade or security, or a class of persons, trades or securities, from a provision in Parts 2 to 5 of this Act, or in the regulations.

Designations

152 (1) If the commission considers it not prejudicial to the public interest to do so, the commission may, without providing an opportunity to be heard, order that

(a) an issuer, or an issuer within a class of issuers, is not a public issuer or a public mutual fund,

(b) an issuer, or an issuer within a class of issuers, is not a mutual fund,

(c) a person, or a person within a class of persons, is not a market participant or a marketplace, or

(d) a right or obligation, or a right or obligation within a class of rights or obligations, is not a derivative.

(2) If the commission considers it in the public interest to do so, the commission may, without providing an opportunity to be heard, order that

(a) an issuer, or an issuer within a class of issuers, is a public issuer or a public mutual fund,

(b) an issuer, or an issuer within a class of issuers, is a mutual fund,

(c) a person, or a person within a class of persons, is a market participant or a marketplace, or

(d) a trade, or a trade within a class of trades, is an offering.

Retroactive effect

153 (1) An order under section 151 or 152 (1) may be made retroactive and, if made retroactive, is deemed to have come into force on the date specified in the order.

(2) An order made retroactive under subsection (1) does not interfere with a person's vested rights.

Power to vary commission rules

154 If the commission considers it not prejudicial to the public interest to do so, the commission may vary a rule made under section 170, or a rule designated under section 169 (2) (d), as it applies to a person, trade or security, or a class of persons, trades or securities.

Power to remove exemption in commission rules

155 If the commission considers it in the public interest to do so, the commission may order that an exemption in a rule made under section 170, or in a rule designated under section 169 (2) (d), does not apply to a person, trade or security, or a class of persons, trades or securities.

Conditions on decisions

156 The commission may impose conditions, requirements and restrictions in a decision it makes.

Discretion to revoke or vary decision

157 If the commission considers it not prejudicial to the public interest to do so, the commission may revoke or vary a decision.

 
Division 4 -- Exercise of Certain Powers

Powers to be exercised by commissioners

158 (1) A power under the following sections must be exercised by the commissioners or by a panel appointed under section 138:

(a) section 60 [administrative penalty];

(b) section 61 [removal of benefits];

(c) section 62 [payment of investigation and hearing costs];

(d) section 70 [review of decision];

(e) section 159 [delegation];

(f) section 170 [commission rules].

(2) A power under the following sections must be exercised by the commissioners, by a panel appointed under section 138 or by a commissioner:

(a) section 49 (1) or (2) [investigation order];

(b) section 52 (1) [entry of premises and production of records];

(c) section 55 (1) [order to freeze property];

(d) section 56 [evidence not to be disclosed];

(e) section 64 [orders on application of interested person].

Delegation

159 (1) The commission may delegate, in writing, to a marketplace, self-regulatory organization or regulatory organization a power or duty it has under

(a) Part 3 [Registration],

(b) Part 4 [Offerings],

(c) Part 5 [Continuous Disclosure], or

(d) section 156 with respect to a power to make a decision under Part 3, 4 or 5.

(2) The commission may at any time withdraw and decide any matter that is before a person acting under an authority delegated under subsection (1).

 
Part 12 -- General

 
Division 1 -- Information and Records

Filing of records

160 A record required to be filed under this Act or the regulations must be filed by sending the record to the commission in accordance with section 162.

Records in electronic form

161 The commission may require that a record required to be produced, provided or filed under this Act or the regulations be produced, provided or filed in an electronic form or in any other form that facilitates the electronic storage of the record.

Notices generally

162 (1) Unless otherwise required by the commission, this Act or the regulations, a record under this Act or the regulations that is sent or required to be sent to a person must be

(a) left with the person or deposited in the person's mailbox or receptacle at the person's residence or place of business,

(b) mailed to the person, or

(c) transmitted electronically to the person.

(2) A record sent to a person under subsection (1) must be sent to the person

(a) at the location where the sender knows the person to be,

(b) at the latest personal or business address, including e-mail address or facsimile number, that the sender knows as the person's latest address,

(c) at the address for service in British Columbia that the person filed, or

(d) at the address of the person's solicitor, if the person or the solicitor has advised that the solicitor is acting for the person.

(3) If a record that is sent or required to be sent is returned on 2 consecutive occasions, the sender is not required to send the record again to the intended recipient until the person informs the sender in writing of the person's new address.

Deemed receipt

163 (1) A person is deemed to have sent a record to the commission if the record is left at the commission's office during normal business hours.

(2) A person to whom a record was sent under section 162 is deemed to have received it

(a) if mailed by ordinary mail, on the 7th day after mailing, or

(b) if mailed by registered mail, on the earlier of the 7th day after mailing or the day the person to whom it was sent, or a person accepting it on that person's behalf, acknowledged its receipt in writing.

Reference to record includes amendment

164 Unless the context indicates otherwise, a reference to a record includes a reference to any amendment or variation of it that is permitted or required under this Act or the regulations.

Obligation to keep information confidential

165 (1) Except as otherwise provided in this Act or the regulations, a person that is or was acting under the authority of this Act or the regulations must keep a record or information confidential, if the record or information was produced, provided or obtained under this Act or the regulations, or under a former enactment or regulation, unless the person's public duty requires, or this Act permits, the person to disclose or release the record or information or to take official action on it.

(2) Subject to subsections (3) and (4), a record or information referred to in subsection (1) must be released to the Ombudsman at the request of the Ombudsman.

(3) A record or information that is obtained

(a) from a law enforcement agency, or

(b) as part of an investigation under this Act,

must not be released to the Ombudsman unless the Ombudsman first produces the written consent of

(c) the law enforcement agency, or

(d) the person from whom the record or information was obtained,

to release the record or information.

(4) A record or information that could lead to the identification of an informant under this Act must not be released to the Ombudsman, unless the person to whom the Ombudsman makes the request first obtains the written consent of the informant to release the record or information.

Information collection and sharing by commission

166 (1) For the purpose of administering this Act or the regulations, or assisting in the administration of the securities laws of another jurisdiction, the commission may, directly or indirectly, collect information from, and use information collected from, a marketplace, self-regulatory organization, regulatory organization, registrant, representative, public issuer, law enforcement agency, government, governmental authority, regulator or financial regulatory authority, in British Columbia or elsewhere.

(2) For the purpose of administering this Act or the regulations, or assisting in the administration of the securities laws of another jurisdiction, the commission may disclose information to, or share information with,

(a) a person recognized under section 7 [recognized marketplace, etc.],

(b) a law enforcement agency, government, governmental authority, regulator or financial regulatory authority, or

(c) a person with whom the commission has entered into an arrangement or agreement that relates to or includes the sharing of information,

in British Columbia or elsewhere.

Information collection and sharing by recognized entity

167 (1) For the purpose of administering its regulatory instruments, assisting in the administration of the regulatory instruments of another marketplace, self-regulatory organization or regulatory organization, or assisting in the administration of this Act, the regulations or the securities laws of another jurisdiction, a person recognized under section 7 may, directly or indirectly, collect information from, and use information collected from,

(a) a marketplace,

(b) a self-regulatory organization,

(c) a regulatory organization,

(d) a registrant, representative or public issuer, or

(e) a law enforcement agency, government, governmental authority, regulator or financial regulatory authority,

in British Columbia or elsewhere.

(2) For the purpose of administering its regulatory instruments, assisting in the administration of the regulatory instruments of another marketplace, self-regulatory organization or regulatory organization, or assisting in the administration of this Act, the regulations or the securities laws of another jurisdiction, a person recognized under section 7 may disclose information to, or share information with,

(a) a marketplace,

(b) a self-regulatory organization,

(c) a regulatory organization, or

(d) a law enforcement agency, government, governmental authority, regulator or financial regulatory authority,

in British Columbia or elsewhere.

Public inspection of records

168 (1) Subject to subsection (2), the commission must make

(a) a record required to be filed under this Act or the regulations, or

(b) an application for a decision,

available for public viewing during normal business hours.

(2) The commission may hold in confidence all or part of a record referred to in subsection (1), including an application referred to in subsection (1) (b), if it considers that

(a) a person whose information appears in the record would be unduly prejudiced by disclosure of the information, and

(b) the person's privacy interest outweighs the public's interest in having the information disclosed.

 
Division 2 -- Regulations, Policies and Forms

Power to make regulations

169 (1) The Lieutenant Governor in Council may make regulations necessary or advisable for regulating trading in or advising on securities and regulating the securities industry.

(2) Without limiting subsection (1), the Lieutenant Governor in Council may make regulations as follows:

(a) regarding any matter in relation to which the commission may make a rule under section 170, and to the same extent;

(b) for the purpose of section 81, specifying a provision of the regulations the contravention of which constitutes an offence;

(c) governing the procedures that are to be followed by the commission in making and repealing a rule made by the commission under section 170, including, but not limited to, prescribing requirements with which the commission must comply before depositing a commission rule with the registrar of regulations;

(d) designating a regulation made under this section to be a rule of the commission;

(e) repealing or amending a rule made by the commission under section 170.

Commission rules

170 (1) Subject to subsections (3) and (4), the commission may make rules necessary or advisable for regulating trading in or advising on securities and regulating the securities industry.

(2) Without limiting subsection (1), but subject to subsections (3) and (4), the commission may make rules as follows:

(a) in relation to those matters for which this Act refers to the regulations, prescribed matters or requirements, or designations;

(b) in relation to any matter necessary or advisable for carrying out effectively the intent and purpose of Part 2 [Market Regulation], including, but not limited to, prescribing requirements for different classes of marketplaces, self-regulatory organizations or regulatory organizations;

(c) in relation to any matter necessary or advisable for carrying out effectively the intent and purpose of Part 3 [Registration], including, but not limited to, prescribing

(i) categories of persons for purposes of registration and otherwise,

(ii) the duration of registration, including different durations of registration for different categories of registrants,

(iii) the manner of allocating persons to categories,

(iv) conditions to be met by persons in the categories, including a condition relating to, or requiring membership in, one or more self-regulatory organizations specified in the regulation,

(v) standards of conduct to be met, and practices to be carried out, by registrants, and

(vi) different or additional requirements for different classes of registrants within a registration category;

(d) in relation to the suspension or revocation of a registration under this Act;

(e) in relation to the transfer of securities;

(f) in relation to any matter necessary or advisable for carrying out effectively the intent and purpose of Part 4 [Offerings], including, but not limited to, prescribing

(i) circumstances in which a record may be, or is deemed to be, incorporated into another record,

(ii) circumstances in which an underwriter or due-diligence provider must be used,

(iii) periods in which a receipt, or a class of receipts, is effective,

(iv) circumstances in which an offering may occur on a continuous or delayed basis,

(v) additional requirements that must be satisfied before a receipt may be issued or before an offering may occur, and

(vi) different or additional requirements for different classes of issuers;

(g) in relation to the use and filing of disclosure documents in connection with an offering exempted under the regulations from section 18 [offering of securities];

(h) in relation to any matter necessary or advisable for regulating public issuers, or other issuers, whose securities are traded on a marketplace or a class of marketplaces or are otherwise publicly traded;

(i) in relation to any matter necessary or advisable for carrying out effectively the intent and purpose of Part 5 [Continuous Disclosure], including, but not limited to, prescribing requirements for different classes of issuers;

(j) in relation to the change of an issuer's auditor, including the disclosure that an auditor must make in relation to the change;

(k) in relation to any matter necessary or advisable for carrying out effectively the intent and purpose of Part 10 [Investor Remedies], including, but not limited to,

(i) exempting any class of persons, trades or securities from liability under Part 10,

(ii) prescribing limits on the aggregate amount payable by a defendant found liable under Part 10 in relation to one or more claims brought under that Part, including limits that consider whether actions have been brought, or money paid out, under similar laws of another province relating to the same matter,

(iii) prescribing circumstances for determining when a misrepresentation or other information has been disclosed or generally disclosed, and

(iv) prescribing or limiting the type of damages payable under Part 10;

(l) in relation to any matter necessary or advisable for regulating takeover bids, takeovers or issuer bids, including, but not limited to,

(i) prescribing requirements for different classes of bids or takeovers,

(ii) prescribing requirements relating to the conduct or management of the affairs of the issuer that is the subject of a takeover bid, and its directors and officers, during or in anticipation of the takeover bid,

(iii) prohibiting a person from trading a security before, during or after the effective period of a takeover bid, and

(iv) prescribing records required to be filed or delivered to a person;

(m) in relation to any matter necessary or advisable for regulating effectively meetings of issuers with securityholders, including, but not limited to, prescribing

(i) requirements for the content, solicitation and voting of proxies,

(ii) requirements relating to communication with registered, legal or beneficial owners of securities, including requirements relating to depositories, registrants or other persons that hold securities on behalf of beneficial owners, and

(iii) matters requiring approval of the commission or the securityholders of an issuer, and defining for specified types of matters what constitutes approval by the securityholders;

(n) in relation to any matter necessary or advisable for regulating mutual funds and fund managers, including, but not limited to,

(i) standards of conduct to be met, and practices to be carried out, by mutual funds and fund managers,

(ii) prescribing permitted investment policy and investment practices for a mutual fund, and prohibiting or restricting a class of investments or investment practices,

(iii) prescribing requirements governing the custodianship of assets for a mutual fund,

(iv) prescribing matters requiring approval of the commission or the securityholders of a mutual fund, and defining for specified types of matters what constitutes approval by the securityholders,

(v) respecting fees, commissions or compensation payable by a mutual fund, a purchaser of a security of a mutual fund or a securityholder of a mutual fund relating to

(A) sales charges, commissions or sales incentives, and

(B) advising, administrative or management services provided to the mutual fund, and

(vi) procedures relating to

(A) sales and redemptions of mutual fund securities, and

(B) payments for sales and redemptions;

(o) prescribing additional filing or disclosure requirements, including the use of particular forms or particular types of records;

(p) establishing fees and charges, or limits on fees and charges, for the purpose of Part 7 [Compliance and Enforcement];

(q) prescribing the rules and procedure to be followed in or relating to a hearing required or permitted by this Act;

(r) in relation to the disclosure of evidence in or relating to a hearing;

(s) incorporating by reference and adopting codes, standards, bylaws, rules or other regulatory instruments, as they are amended from time to time;

(t) in relation to the preparation or keeping of information or records by a person or class of persons;

(u) in relation to the provision or distribution of information or records by a person or class of persons to any person or class of persons, including the payment of fees for providing information or records;

(v) in relation to the collection and use, or disclosure and sharing, of personal information by a person;

(w) in relation to the content or distribution of information or records by a person or class of persons to any person or class of persons, if the information or records are distributed for the purpose of, or have the effect of, marketing securities or trading or advising services;

(x) prescribing the fees payable in connection with the administration of this Act and the regulations or the activities carried out by the commission under another enactment;

(y) designating one or more persons to perform a function relating to market integration, market transparency or the clearing and settlement of trades;

(z) exempting a class of persons, trades or securities from one or more of the provisions of Part 2, 3, 4 or 5, or of the regulations;

(aa) prescribing circumstances or conditions for the purpose of an exemption under paragraph (z), including, but not limited to,

(i) conditions relating to compliance with the securities laws of another jurisdiction, or compliance with the regulatory instruments of a person recognized under section 7, as the laws or instruments are amended from time to time, and

(ii) conditions that refer to a person or a class of persons designated by the commission;

(bb) revoking a class of commission decisions;

(cc) in relation to

(i) the amendment or modification of a record and the effect of that amendment or modification,

(ii) the use of records prepared in accordance with similar laws of another jurisdiction to satisfy the requirements of this Act or the regulations, and

(iii) the filing of records by electronic or other means;

(dd) defining words and expressions used but not defined in this Act;

(ee) to meet any difficulties that may arise by reason of the repeal of the Securities Act, R.S.B.C. 1996, c. 418, and the substitution of this Act.

(3) Before making or repealing a rule, the commission must obtain the consent of the minister in accordance with the regulations and comply with any other procedure or requirement prescribed by the Lieutenant Governor in Council under section 169 (2) (c).

(4) Despite subsection (3), the commission may make or repeal a rule under this section, without complying with the prescribed procedures and requirements, if

(a) the commission considers it necessary and in the public interest to make or repeal the rule without delay, and

(b) the minister consents to the making or repeal of the rule without the commission's compliance with the prescribed procedures and requirements.

(5) Unless earlier revoked, a rule made under subsection (4) is revoked at the end of the period prescribed by the Lieutenant Governor in Council.

Regulation prevails over commission rule

171 If a rule made by the commission under section 170 conflicts with a regulation made by the Lieutenant Governor in Council under section 169, the regulation made by the Lieutenant Governor in Council prevails.

Required forms

172 (1) The commission may specify the structure and content of a required form under this Act or the regulations, and may specify the principles to be applied in completing the form and any additional records to be filed with it.

(2) The commission may specify different forms for different classes of persons, trades or securities.

 
Division 3 -- Other Matters

Contraventions attributable to others

173 (1) If a person, other than an individual, contravenes a provision of this Act or the regulations or a commission decision, an employee, officer, director, agent or significant securityholder of the person that authorizes, permits or acquiesces in the contravention also contravenes the provision or the decision, whether or not

(a) the commission has made a finding that the person has contravened the provision or the decision, or

(b) a charge has been laid, a plea of guilty has been entered or the person has been convicted of an offence for the contravention.

(2) If a mutual fund contravenes a provision of this Act or the regulations or a commission decision, the fund manager of the mutual fund also contravenes the provision or the decision.

Limitation period

174 Except for a proceeding under Part 10 [Investor Remedies], a proceeding under this Act must be commenced within 6 years after the date of the last event that gives rise to the proceeding.

Immunity of commission and others

175 (1) In this section, "protected person" means any of the following:

(a) the commission;

(b) a commissioner;

(c) an officer or employee of the commission;

(d) a person acting under an order of the commission, under a written or oral direction of the commission, or with the consent of the commission, and a director, officer, employee or agent of the person;

(e) a person acting under an order of the minister under section 58.

(2) No proceeding under the Judicial Review Procedure Act may be commenced or maintained against a protected person in relation to any act done, or any omission made, in good faith in the administration of this Act or the regulations.

(3) Subject to subsection (4), no action or other legal proceeding for damages lies or may be commenced or maintained against a protected person because of anything done or omitted

(a) in the exercise or intended exercise of any power under this Act or the regulations, or

(b) in the performance or intended performance of any duty under this Act or the regulations.

(4) Subsection (3) does not apply to a protected person in relation to anything done or omitted in bad faith.

(5) No person has any remedy, and no action or other legal proceeding lies or may be commenced or maintained, against any person for any act done or omission made by that person in compliance with this Act or the regulations or with a decision made under this Act or the regulations.

Admissibility in evidence of certified statements

176 A statement concerning

(a) whether or not a person is or was registered under this Act or the regulations, and any other information related to that statement, or

(b) whether or not a record or other information has been filed under this Act or the regulations, and any other information related to that statement,

purporting to be certified by the commission is, without proof of the office or signature of the person certifying it, admissible in evidence for all purposes in any action, proceeding or prosecution.

Repeal

177 The following Acts are repealed:

(a) the Securities Act, R.S.B.C. 1996, c. 418;

(b) the Supplement to the Securities Act.

 
Consequential Amendments

 
Business Corporations Act

178 Section 1 (1) of the Business Corporations Act, S.B.C. 2002, c. 57, is amended

(a) by repealing the definition of "executive director",

(b) in the definition of "public company" by repealing paragraphs (d) and (e) and substituting the following:

(d) has, within the meaning of the Securities Act, any of its securities traded on or through, or reported through, the facilities of a marketplace; ,

(c) by repealing the definition of "reporting issuer" and substituting the following:

"reporting issuer" means a public issuer or public mutual fund as defined in the Securities Act; , and

(d) in the definition of "Securities Commission" by striking out "section 4 of the Securities Act;" and substituting "section 135 of the Securities Act;".

179 Section 91 (3) and (4) is repealed and the following substituted:

(3) If the Securities Commission considers it not prejudicial to the public interest to do so, the Securities Commission may exempt a trust indenture, a class of trust indentures or a person or class of persons from one or more of the provisions of this Division.

(3.1) The Securities Commission may make an order under subsection (3) on application by an interested person or on its own motion.

(3.2) The Securities Commission may impose conditions, requirements and restrictions in an order it makes under subsection (3).

(3.3) If the Securities Commission considers it not prejudicial to the public interest to do so, the Securities Commission may revoke or vary an order made under subsection (3).

180 Section 185 (1) (b) (ii) is amended by striking out "that are comparable in scope and intent to" and substituting "relating to the same subject matter as".

 
Cooperative Association Act

181 Section 91 (1) of the Cooperative Association Act, S.B.C. 1999, c. 28, is amended by striking out "reporting issuers." and substituting "public issuers or public mutual funds."

182 Section 110 (1) (d) is amended by striking out "reporting issuer," and substituting "public issuer or a public mutual fund,".

183 Section 153 (1) (b) (v) and (vi) is amended by striking out "in British Columbia".

 
Employee Investment Act

184 Section 12 (1) of the Employee Investment Act, R.S.B.C. 1996, c. 112, is amended by striking out "reporting issuer" and substituting "public issuer or public mutual fund".

 
Finance and Corporate Relations Statutes Amendment Act, 1998

185 Sections 24 and 25 of the Finance and Corporate Relations Statutes Amendment Act, 1998, S.B.C. 1998, c. 7, are repealed.

 
Financial Institutions Act

186 Section 50 (3) (b) of the Financial Institutions Act, R.S.B.C. 1996, c. 141, is repealed and the following substituted:

(b) by a person acting as an underwriter, as defined in the Securities Act, in connection with an offering, as defined in that Act, of the voting shares that are the subject of the acquisition.

187 Sections 146 (5) (b) and 149 (3) (d) are amended by striking out "as defined in section 92 of the Securities Act".

 
International Financial Business Act

188 Section 1 (1) of the International Financial Business Act, R.S.B.C. 1996, c. 234, is amended in the definition of "investment dealer" by striking out "or underwriter".

189 Section 15 (2) is amended by striking out "Sections 143 (2) to (5) and 144 to 146 and 150 of the Securities Act" and substituting "Sections 50, 52, 54 and 62 of the Securities Act".

190 Section 19 is amended

(a) in subsection (1) (c) by adding "or" after "section 14 (2),", and

(b) by repealing subsections (1) (d) and (6).

 
International Financial Business (Tax Refund) Act

191 Section 1 (1) of the International Financial Business Act (Tax Refund) Act, R.S.B.C. 1996, c. 235, is amended in the definition of "investment dealer" by striking out "or underwriter".

 
Mortgage Brokers Act

192 Section 7 (8) of the Mortgage Brokers Act, R.S.B.C. 1996, c. 313, is amended by striking out "section 152 of the Securities Act applies" and substituting "Division 1 of Part 9 of the Securities Act applies".

 
Partnership Act

193 Section 48 of the Partnership Act, R.S.B.C. 1996, c. 348, is amended

(a) by repealing the definitions of "executive director" and "reporting issuer", and

(b) by adding the following definitions:

"public issuer" means a public issuer as defined in the Securities Act;

"Securities Commission" means the British Columbia Securities Commission continued under section 135 of the Securities Act.

194 Section 54 (4) is amended by striking out "reporting issuer" and substituting "public issuer".

195 Section 58 (2) is repealed and the following substituted:

(2) If the Securities Commission considers it not prejudicial to the public interest to do so, the Securities Commission may exempt a limited partnership from a right granted under subsection (1) (a) or (b) or both.

(3) The Securities Commission may impose conditions, requirements and restrictions in an order it makes under subsection (2).

(4) If the Securities Commission considers it not prejudicial to the public interest to do so, the Securities Commission may revoke or vary an order made under subsection (2).

196 Section 66 is amended

(a) in subsection (6) by striking out "reporting issuer" and substituting "public issuer", and

(b) by repealing subsection (7) and substituting the following:

(7) If a limited partnership is a public issuer and an interest, in whole or in part, is to be assigned and, at the time the assignment is to be entered under subsection (2), an unpaid contribution in respect of it

(a) is not due, and

(b) has no due date set,

the assignor is solely liable for that unpaid contribution unless the assignor discloses it to the assignee before the assignment is entered under subsection (2), in which case the assignee is solely liable.

 
Public Service Labour Relations Act

197 Section 1 (1) of the Public Service Labour Relations Act, R.S.B.C. 1996, c. 388, is amended in paragraph (cc) of the definition of "employee" by striking out "section 9 of the Securities Act" and substituting "section 140 of the Securities Act".

 
Real Estate Act

198 Section 28 (3) of the Real Estate Act, R.S.B.C. 1996, c. 397, is amended by striking out "sections 143 (2) to (5) and 144 to 146 of the Securities Act" and substituting "sections 50, 52, and 54 of the Securities Act".

 
Regulations Act

199 The Schedule to the Regulations Act, R.S.B.C. 1996, c. 402, is amended by striking out "The commission rules as defined by the Securities Act." and substituting "Rules made by the Securities Commission under section 170 of the Securities Act."

 
Securities Amendment Act, 2002

200 Sections 19 (b) and 23 (b) of the Securities Amendment Act, 2002, S.B.C. 2002, c. 32, are repealed.

 
Securities Amendment Act, 2003

201 Sections 1 (b), 4, 6, 10, 11 and 13 (b) and (d) of the Securities Amendment Act, 2003, S.B.C. 2003, c. 24, are repealed.

 
Utilities Commission Act

202 Section 54 of the Utilities Commission Act, R.S.B.C. 1996, c. 473, is amended

(a) in the definition of "take over bid" in subsection (1) by striking out "in the Securities Act;" and substituting "in section 87 of the Securities Act;", and

(b) in subsection (13) by striking out "under section 184 of that Act" and substituting "under section 170 of that Act".

Commencement

203 This Act comes into force by regulation of the Lieutenant Governor in Council.