Groundbreaking Program on Ethics in Law and Business launches

Monday, March 11, 2013

Launch of the Program on Ethics in Law and Business

By Noel Semple, JD 2007, SSHRC Postdoctoral Research Fellow, Centre for the Legal Profession

Income Trusts and the Diversified Investor

Mohammad Fadel
Tuesday, November 14, 2006

This commentary was first published in the Financial Post on November 9, 2006.

With the surprise announcement last week by the Conservative government that distributions by income trusts would no longer be exempt from corporate-level taxation, investors in income trusts have suffered material losses to those investments.

Interestingly, investors with diversified portfolios of Canadian equities would have hardly noticed a difference in their wealth and are probably wondering what all the fuss is about.

While the TSX composite index suffered a substantial loss on the day immediately following the government's announcement, it has already made up most, if not all, of those losses. Since the announcement, then, the TSX Income Trust Index has underperformed the broader TSX Composite Index by approximately 10%. Even taking into account the current yield disparity in the two indexes (approximately 9% for the Income Trust Index and 2% for the TSX Composite Index), the TSX Composite Index still comes out ahead of the Income Trust Index by approximately 3%.

Prof. Anita Anand: "Telus win scores for ­shareholders"

Thursday, October 18, 2012

In a commentary in the Financial Post, Prof. Anita Anand analyzes the history of the merging of dual-share structures in Canada through the lens of the recent decision regarding Telus ("Telus win scores for ­shareholders," Oct. 18, 2012).

Read the full commentary on the Financial Post website, or below.

Securities Law Needs More Enforcement, Not More Laws

Anita Anand
Monday, March 24, 2008

Originally posted on Lawyers Weekly: http://www.lawyersweekly.ca/index.php?section=article&articleid=640

Many commentators believe that securities law violations are under-enforced and under-prosecuted in Canada. But quite apart from securities regulatory enforcement, what is the role of the criminal law in the enforcement of financial crimes? Criminal prosecutions are necessary not simply as a supplement to the quasi-criminal jurisdiction of securities regulators, but as a first line in the enforcement of financial crimes. But criminal law has been virtually unused for this purpose even though the law on the books is wholly sufficient. This is because its enforcement and application is the “weak link” in the process.

Consider the purposes in Ontario’s Securities Act which are “to provide protection to investors from unfair, improper or fraudulent practices; and to foster fair and efficient capital markets and confidence in capital markets.” In the quasi-criminal context, where the securities commission pursues an enforcement action in provincial court, the commission is bound to adhere to these objectives and, when adjudicating the matter, the provincial court is similarly bound. So the objectives of securities law are generally prospective and preventative for capital markets.

Backing the BCE Bondholders - Beyond Law and Contract

Anita Anand
Thursday, May 22, 2008

On May 21, 2008, the Quebec Court of Appeal reversed the lower court finding in the BCE Inc. case. BCE proposed an arrangement in which certain bondholders stood to be disadvantaged because the level of BCE's debt would be increased.  The higher level of debt would in turn decrease the value of the existing debt as well as occasion a loss of investment grade status. The Court of Appeal held that the bondholders' interests must be considered when the board is discharging fiduciary duties.  But the Court has pushed the concept of fiduciary duties into new territory, a move that seems to stretch existing law.

The Court conceives directors' fiduciary duties broadly, criticizing the BCE board for not considering how the plan of arrangement at issue might be unfair to bondholders.  The Court relies on the SCC decision in Peoples v Wise (SCC 2004). However, Peoples in my view misconceives fiduciary duties, thus creating a potential domino effect for future decisions like BCE. The problem with Peoples is that it interprets directors’ fiduciary duties as applying to a broad range of corporate stakeholders (creditors, suppliers, consumers, employees, enivronmental groups etc.), thus watering down the duty significantly: a duty owed to everyone is in effect a duty to no one.  But the BCE board was seeking to maximize shareholder value in a change of control transaction, something that most lawyers take to be settled law. 

Does the Credit Crisis Implicate the Need for a National Securities Regulator?

Anita Anand
Monday, November 3, 2008

There are strong arguments in favour of a national securities regulator  which have been voiced numerous times over the past few decades: greater efficiency in transactions, consistent and coherent presence  internationally, single enforcement body, uniform securities legislation, lower costs for issuers and registrants,  etc.  Flowing from a series of federal, provincial and industry reports, these arguments make a coherent case for a national regulator notwithstanding the usefulness of the passport system of regulation over the  past few years.

Recently, Finance Minister Flaherty provided another reason for a national securities regulator: current market turmoil (see Toronto Star, Nov. 2).  However, while a number of financial market issues are on centre stage in this context, only some of these issues fall within the jurisdiction of securities
regulation per se.  Thus, while the time seems ripe to bring this issue to forefront of the political agenda, the need for a national securities regulator is not obvious from current financial market conditions alone.

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