The Ontario Divisional Court has confirmed the nature of the authority of the Investment Industry Regulatory Organization of Canada (IIROC) in Deeb v IIROC, 2012 ONSC 1014.  

Michael Deeb, the president of Hampton Securities, was investigated on the basis of three anonymous letters the regulator had received about the firm. Apparently the investigation initially indicated that everything was fine, but IIROC subsequently issued a notice of hearing which it posted on its website. Deeb and Hampton alleged that this caused their business to suffer and that IIROC was acting maliciously in instituting proceedings against them. They sought judicial review.

Pepall J agreed with IIROC that while IIROC is recognised under Part VIII of the Securities Act, its regulatory jurisdiction is not statutory; it is a matter of contract between the regulator and its members. As a result, IIROC does not exercise a public law power that can be the subject of judicial review. Even if it did, it would be premature to allow judicial review before IIROC’s hearing panel had made an actual decision that could be reviewed. IIROC’s motion to quash the application for judicial review was granted.

[Link available here].