Decision in brief: Binance Holdings Limited, Application to revoke s.11 Order, July 14, 2023

Binance Holdings Limited asked the Tribunal to revoke (or cancel) an order starting a formal investigation against them to investigate them. Before the Tribunal could decide whether it should revoke the order, it first had to consider whether it had the power to do so. Binance said that the Tribunal had the power to revoke the order because s.144(1) of the Securities Act allows the Commission to “make an order revoking or varying a decision of the Commission.” The definition of decision in the Act includes an order. The panel had to decide whether the “Tribunal” was part of the “Commission” for this purpose.

The Tribunal decided that it does not have the power to revoke an investigation order of the Commission.

The Securities Act was changed in 2022 and as a result of those changes, the Capital Markets Tribunal was created as a “division of the Commission.” Before those changes, members of the Commission acted as directors of the board of the Commission and as adjudicators. Following these changes, adjudicator and board director are separate roles. An adjudicator only decides hearings of the Capital Markets Tribunal and holds no other position with the Commission.

The Tribunal decided that the word “Commission” in the Securities Act does not always mean the same thing. Sometimes it might include the Tribunal, but other times it does not make sense that it would include the Tribunal. The Tribunal decided that the word “Commission” in s. 144(1) of the Act does not include the Tribunal. If it did, the Tribunal could revoke a decision of the Commission and the Commission could revoke a decision of the Tribunal. The Tribunal was created to make it more independent from the Commission.

Also, when the Tribunal was created, a new section, s. 144.1(1), was added to the Securities Act. That section gives the Tribunal the power to “make an order revoking or varying a decision of the Tribunal.” This new section would not have been necessary if, as Binance argued, the power to revoke that is contained in s. 144(1) included the Tribunal.