Canada: The Alberta Securities Commission Imposes Important New Obligations For Recipients Of Production Demands

Last Updated: February 27 2014
Article by Justin R. Lambert

The Alberta Securities Commission (ASC) has always had the power to compel Registrants, Reporting Issuers, and others to produce records in the course of an investigation. Section 93.4 of the Securities Act (Alberta) has also previously required that persons not destroy records required for an ASC investigation. Recently, however, the ASC set out new and explicit obligations for those who receive a production order from the ASC.

ASC Rule 15–503 now codifies how recipients of a production order from the ASC must respond to the demand, and the format in which responsive documents must be produced. Passage of this Rule means that anyone receiving such a production demand must act quickly and carefully to ensure compliance with the Rule, and ensure that a clear, effective, and efficient process is in place to preserve and gather the records required in the appropriate format. Creating a clear and convincing trail of compliance will be important to satisfy the ASC that the Rule has been complied with.

Legal Holds

Legal holds (typically in the form of formal letters to IT personnel and relevant individuals to preserve documents and halt normal-course document destruction policies) have always been best practice once a demand for production has been received from an investigative body. However, the effect of Rule 15–503 is to make such formal holds effectively mandatory. Section 4 of the Rule requires the recipient of a production order to halt all destruction or deletions of records, either by deliberate action or by failing to take reasonable steps to preserve records, including records that are subject to scheduled or periodic deletion, overwriting, or replacement. Further, section 4 of the Rule requires that the recipient take reasonable steps to promptly and clearly notify affected third parties, including employees, agents or contractors to halt destruction, deletion, disposal, damage or alteration of records. This includes an obligation to notify third parties who are operating servers which might contain such records. Affected IT departments, remote technology providers, and employees must be notified of the obligation to preserve records in their original form. The obligation to maintain those records for the recipient and third parties is in effect for a period of two years from the date the production order is received.

The Rule is clearly aimed at ensuring that recipients of a production order comply with it, and effectively requires that recipients of production orders be able to clearly demonstrate to the ASC that every effort has been made to preserve records to comply with the Rule.

Interestingly, section 4 of the Rule extends the preservation obligations to "remote electronic custodians", which suggest that operators of servers or "clouds" are caught by the Rule. Once a production order is received, the Rule obligates the recipient to provide notification to such third parties. When those third parties, including remote electronic custodians, receive notification of a production order from the original recipient of the production order, the Rule purports to require the third party recipients of the notification to comply with the obligations in the Rule. It will be interesting to see how this purported obligation applies in reality when remote servers or cloud services are located in jurisdictions outside of Alberta, or even outside of Canada.

Format of Production

In an apparent adoption of civil litigation procedure, the ASC now requires that any document production made in response to a production order be accompanied by an "electronic cover letter", which is strikingly similar in substance and form to an affidavit of records. In particular, the respondent to a production order must now list each piece of media or other storage device through which documents are produced, identified by a unique identifier; list unique record numbers for the records produced, cross-referenced to the media from which the documents were obtained; provide a list of sources from which or from whom the records were obtained; and declare that the records produced represent all the records specified in the demand for production, are true copies of those records, and that the records have been provided and numbered in accordance with the Rule.

The Rule also provides that a respondent must provide a "true copy" of any particular record. A true copy is one where colors and all text, notations, highlighting, marginal notes, and other similar markings are reproduced. Documents containing removable notes and removable flags must also be reproduced both with and without such removable notes and flags.

Electronic records must be provided in their native format, and a respondent must make available to the ASC the systems or software to enable review and interpretation of the record, and metadata must be accessible. Passwords must be provided. Respondents must generally provide the means for the ASC to access the records provided.


This new Rule indicates a clear attempt by the ASC to preserve and receive documents in a way that will enhance its ability to investigate, and to put in place clear and unequivocal document preservation obligations. The most important obligation for corporate respondents will likely be the mandatory litigation hold, which will make the prompt and effective distribution of timely, meaningful and effective litigation hold letters incredibly important.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Justin R. Lambert
In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.