8 Can. Bus. L.J. 485 (1983-1984)
Corporate and Investment Attitudes towards Insider Trading in Canada

handle is hein.journals/canadbus8 and id is 507 raw text is: CORPORATE AND INVESTMENT ATTITUDES
TOWARDS INSIDER TRADING IN CANADA
Edward Rosenbaum, Ralph L. Simmonds, John H. Simpson and
Dainius P. Vaidila. *
1. Introduction
During the past two decades, securities trading by persons with
privileged access to price-sensitive information has become in
Canada a very visible and important part of the area of activity
brought under the sway of securities regulation. While no attempt
has been made to ban such trading altogether, continuous
disclosure and fairness to the market policies have been thought
to warrant some controls.1 Legislation introducing to Canada a
pattern of regulation which borrowed heavily from experience
under the American federal scheme was passed in Ontario in
1966.2 That legislation combined trade reporting requirements
for insiders with civil liability (more narrowly defined than in the
American scheme) for improper insider trading3 and the possi-
bility of administrative sanctions, such as cease trading orders.4
One mode of regulation in the American federal scheme not
employed in the Canadian one was the so-called short swing
 Edward Rosenbaum is a professor in the Faculty of Business Administration, University
of Windsor and Director, Study Seminary for Financial Analysts; Ralph L. Simmonds is
Associate Dean (Academic) in the Faculty of Law, McGill University; John H. Simpson
is Investment Officer/Portfolio Manager; Canada Trust Company, Toronto and an
M.B.A. graduate of the University of Windsor; and Dainius P. Vaidila is Manager -
Investments, Continental Bank of Canada, Toronto and an M.B.A. graduate of the
University of Windsor.
I Report of the Attorney-General's Committee on Securities Legislation in Ontario (J.
Kimber, Chairman, 1965), Part II, which in Canada was the seminal document.
2 For an account, see B. J. Davies, Canadian and American Attitudes on Insider
Trading, 25 U.T.L.J. 215 (1974), especially at pp. 218 etseq.
3 Ibid., pp. 220-9.
4 See V. Alboini, Ontario Securities Law (Toronto, Richard De Boo, 1980), hereafter
Alboini, pp. 830, 833; and James C. Baillie and Victor P. Alboini, The National Sea
Decision - Exploring the Parameters of Administrative Discretion, 2 C.B.L.J. 454
(1978).

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