Dear members of the Capital Markets Modernization Taskforce (the Taskforce) –
On behalf of Save Canadian Mining (SCM) and its founding partners, I want to thank you for the work you have been doing over the past several months. It was a pleasure meeting with you and presenting to you our opinions on which regulations in Ontario’s capital markets should be targeted as part of your review of Ontario’s Securities Act. We were encouraged by your initial report, particularly your recommendations targeting predatory short-selling and those that supported small businesses. As an advocacy group representing issuers in the junior mining sector, please know that we view your work as a very important exercise and we thank you for the attention you have paid to our concerns.
As a reminder, SCM was launched in September 2019, and has since secured the support of industry associations such as the Ontario Mining Association (OMA), the Ontario Prospectors Association (OPA), as well as notable industry investors like Eric Sprott (Sprott Mining Inc.), Rob McEwen (McEwen Mining Inc.), Keith Neumeyer (First Majestic Silver Corp.) and Sean Roosen (Osisko Mining Inc.). Many junior mining companies have lent their support to this effort and SCM has collected the “signatures” of over 2,000 supporters from across the industry who recognize short-selling is an issue holding back the industry.
This submission contains three sections. The first outlines our feedback on several key recommendations made in your initial consultation report.
The second makes a case for reinstatement of the “tick test.” We have conveyed to you in our earlier meetings and correspondence why SCM considers the tick test to be an important regulation for the junior mining sector and properly functioning capital markets, and the second section elaborates on this. The second section will also provide comments on recent meetings that SCM has had with IIROC, the body that repealed the tick test in 2012. The third represents observations and recommendations about Failed Trades and research on short selling from McMillan LLP that we received that we felt important enough to forward for further consideration. Due to the size and scope of our organization we did not have the ability to provide an in depth review. We hope the Task Force or the Ministry of Finance can devote resources to examine these issues.
Ultimately, we continue to encourage the Taskforce to revisit our recommendation that it recommend to the provincial government that the tick test should be reinstated.
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