July 5, 2011 / 10:04 PM / in 6 years

UPDATE 1-Ontario watchdog to probe emerging-market issuers

* Probe to examine disclosures of some of these companies

* OSC to also look at role of auditors, underwriters

TORONTO, July 5 (Reuters) - The Ontario Securities Commission said on Tuesday it is conducting a targeted review of companies listed on markets it regulates that have significant business operations in emerging markets.

The OSC, Canada’s major securities regulator, has come under fire from some market watchers in recent weeks for failing to step in as shares of Toronto-listed Chinese forestry company Sino-Forest TRE.TO collapsed following accusations of fraud leveled by short-seller Muddy Waters.

The OSC has stated that it is investigating the Sino-Forest matter, but the scandal has also tainted the image of other Chinese companies with listings in Canada. The regulator did not specify whether its investigation would focus exclusively on Chinese companies.

“The review is designed to closely examine the disclosure of certain issuers from those markets and the vehicles through which these companies have accessed the Ontario market,” the OSC said in a statement.

“OSC staff will also focus on the role of the auditors and underwriters in this process,” the regulator said.

The OSC said it has already contacted some issuers and their advisors and will continue to do so over the coming weeks. (Reporting by Euan Rocha; editing by Peter Galloway)

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