I'll give a very quick thirty-second history of the CBCA. As I mentioned, it was introduced in 1975, and in 2001 a set of very comprehensive amendments were made. These were the result of extensive national consultations across the country involving hundreds of stakeholders and soliciting a large number of recommendations and suggestions for change. The resulting amendments directly reflected the concerns of those stakeholders. We would be happy to provide more detail about the extent of those consultations and those changes.
In 2004, after the Enron and WorldCom scandals, Industry Canada issued a discussion paper asking stakeholders what amendments might be necessary to the CBCA. Among the issues under discussion in that paper were the independence of directors and auditors, the certification of financial statements by the CEO of corporations, the separation of the positions of CEO and chairman of the board, and whether increases in penalties were needed for infractions of the relevant provisions of the CBCA. As a result of those consultations, there was little consensus among stakeholders about how the federal government should address those issues. However, most felt that since the CBCA applies only to a percentage of publicly traded Canadian corporations, these matters should be left to provincial securities regulators.
A second discussion paper was issued, in 2007, asking whether the government should enact a stand-alone piece of legislation to establish procedures on the transfer of securities or whether this should be left to the provinces. The prevailing view as a result of the consultations was that the federal government should not introduce its own security transfers act, but rather that the provinces would be in a better position to regulate the procedures around transferring shares and securities of corporations.
To sum up, the CBCA appears to be a well-functioning statute. It's responsive and flexible, and since 2001 there has been little substantive or significant demand for amendments to the CBCA. However, that's not to say, as is the case for any piece of legislation, that it is perfect. Because of the continuing evolution of the marketplace, modernization may be required. We suspect stakeholders, specifically the Canadian Bar Association, the Canadian Coalition for Good Governance, and the Shareholder Association for Research and Education, will be interested in having the opportunity to address the committee on a number of issues.
We will be following the committee's deliberations with interest and look forward to its recommendations.
We are now happy to answer all of your questions.
Thank you.