The Securities Transfer Act Is Almost Here: Get Started With Start

On November 1, 2006, the Ontario government announced that Ontario’s new Securities Transfer Act, 2006 (the "STA") will come into force on January 1, 2007. Modelled closely on Revised Article 8 of the U.S. Uniform Commercial Code, the STA will modernize the law that governs the transfer and pledging of investment securities, especially those held indirectly through intermediaries such as brokers and clearing agencies for which the investor never receives a paper certificate. Until now that law has been confused and incomplete, and as a result, the legal certainty demanded by the capital markets has been sadly lacking for transactions secured by pledges of "bookbased" securities. Opinions have been difficult, sometimes impossible, to give, and as a result lenders have often been unwilling to take such securities as collateral, even though hundreds of billions of dollars of value are locked up in publicly traded corporate stocks and bonds that are held and settled through clearing