Following a rule change that takes effect at the end of the month, the Alberta Securities Commission (ASC) will move to calculating the costs ordered in enforcement cases based on a menu of flat-rate charges rather than tracking the hours consumed by investigating and prosecuting these cases.
As of Oct. 31, the ASC will adopt a tariff-based approach in determining the size of costs orders.
The shift reflects an effort to improve enforcement efficiency, given that much staff time is wasted tracking hours.
“Since the majority of cases under investigation do not result in hearings, limited staff resources are needlessly expended on time-tracking for these cases with no ultimate recouping of costs,” the regulator said in a notice outlining the proposed change.
Moreover, the collection rate for costs awards is low, “which further highlights the inefficiency and wasted resources in tracking time on an hourly basis,” it said.
Moving to a tariff-based approach will also improve transparency for respondents, it said, as those facing an enforcement case will be more easily able to estimate the costs of opting for a contested hearing, given the set changes.
For instance, each hearing day will cost $8,000 for the first 15 days of hearing time.
“Moving to a tariff rate would reduce inefficiencies in costs awards based on outdated hourly rates while still allowing for accountability for respondents and transparency for the market,” the regulator said.
As of Oct. 31, the ASC will begin using the tariff-based approach in calculating costs orders for ongoing proceedings, regardless of whether the activity took place before it adopted the new methodology. For cases in which sanctions hearings have been completed but decisions haven’t been handed down, ASC staff will seek the lower of the two options — the hourly rate or the tariff approach.