On April 4, 2013, the Ontario Securities Commission requested comments on its proposed guidelines relating to how the OSC applies the prohibition in section 143.11 of Securities Act on the making of orders of general application (also referred to as “prohibited blanket orders”) to exemption applications.

The OSC has recognized the difficulty in its ability to respond to requests for exemptive relief due to the possibility that some orders for exemptive relief would constitute prohibited blanket orders. Because of this difficulty, the OSC is attempting to make more transparent the various factors considered when granting orders and applying section 143.11. It is hoped that the guidelines will assist applicants in crafting appropriate requests for exemptive relief so that section 143.11 is not triggered.

When the OSC must determine whether a requested order would constitute a prohibited blanket order (and therefore be contrary to the regulations) it must consider whether the order is of “general application”.

According to the proposed guidelines, three factors form the basis of the OSC’s analysis for determining when an order is of general application: the scope of the order, the impact of the order and the permanence of the order.

The guidelines state that applicants who wish to avoid the application of section 143.11 to their requested order should attempt to illustrate to the OSC that the order is intended to relieve the applicant of unnecessary adherence to a technicality. Applicants should also attempt to illustrate that the requested exemption will not have significant policy implications for capital markets. Short-term orders that provide transitional relief are also appropriate under the guidelines.

Comments on these proposed guidelines are due by June 5, 2013. Following the comment period, the OSC will publish the guidelines in final form.