On June 8, 2017, the Canadian Securities Administrators (“CSA”) published for a 90-day comment period (ending on September 6, 2017), proposed amendments (the “Proposed Amendments”) to National Instrument 45-106 Prospectus Exemptions (“NI 45-106”) that would amend the report of exempt distribution (the “Report”) set out on Form 45-106F1 Report of Exemption Distribution that must be filed following a distribution of securities in reliance on certain prospectus exemptions under NI 45-106. The current version of the Report came into effect on June 30, 2016 and requires filers to provide substantially more information than … Continue Reading
The Ontario Securities Commission (OSC) recently held a roundtable on the “Proposed Protocols for Meeting Vote Reconciliation”. The purpose of this roundtable was to discuss issues identified during the consultation phase of CSA Multilateral Staff Notice 54-304, Final Report on Review of the Proxy Voting Infrastructure and Request for Comments on Proposed Meeting Vote Reconciliation Protocols (Staff Notice) as well as to discuss the OSC’s proposed next steps in implementing the protocols outlined in Annex A of the Staff Notice, which protocols are intended to address some of the widely accepted issues with the proxy voting infrastructure.
Background on the … Continue Reading
On December 14, 2016, the Government of Canada published proposed regulations to Bill C-25. Bill C-25, which completed the second reading debate stage in the Parliament of Canada on December 9, 2016, would, if passed into law, result in important changes for public corporations that are governed by the Canada Business Corporations Act (CBCA).
For a summary of the proposed changes, see our previous post Bill C-25 contemplates important changes to director elections, notice-and-access procedures and other matters for public corporations governed by the Canada Business Corporations Act.
This post discusses updates regarding certain of the proposed changes … Continue Reading
On September 28, 2016, Bill C-25 passed first reading in the Parliament of Canada. The Bill is currently at the second reading debate stage. If passed into law, the Bill will result in important changes for public corporations that are governed by the Canada Business Corporations Act (CBCA) including:
- Director Election Matters. Enshrining majority voting into the CBCA such that a director will only be elected if the number of votes cast in his or her favour represents a majority of the total number of votes cast at the meeting, enshrining the practice of “individual voting” rather than “slate voting”
In August 2016, the Canadian Securities Administrators (“CSA”) published for comment Proposed Amendments to National Instrument 24-101 (“NI 24-101”) – Institutional Trade Matching and Settlement, Proposed Changes to Companion Policy 24-101 (“CP 24-101”) – Institutional Trade Matching and Settlement and CSA Consultation Paper 24-402 – Policy Considerations for Enhancing Settlement Discipline in a T+2 Settlement Cycle Environment (the “Consultation Paper”).
The proposed amendments to NI 24-101 and CP 24-101 (the “Proposed Amendments”) are intended to assist in a successful migration to T+2 settlement from the current T+3 regime. The … Continue Reading
The Ontario Securities Commission (the “OSC”) is seeking comment on Proposed OSC Rule 72-503 – Distributions Outside of Canada and its related companion policy (the “Proposed Rule”), to eliminate longstanding uncertainty about how outside of Canada distributions of securities will be regulated.
Purpose of the Proposed Rule
A distribution of securities by an issuer to foreign investors may or may not fall under the jurisdictional scope of the Securities Act (Ontario) (the “Act”) depending on the connecting factors to Ontario (e.g. the issuer having an active trading market in Ontario or a head office in Ontario).
In an interpretation note … Continue Reading
The OSC is close to adopting a proposed final version of its previously-announced whistleblowing policy (the Program). The Program would award eligible whistleblowers up to $5 million for reporting serious securities- or derivatives-related misconduct that leads to significant enforcement or settlement outcomes.
We summarized the original OSC consultation paper in a previous article. The OSC received comments on the consultation paper and also hosted a stakeholder roundtable on the proposals. Reporting issuers will want to re-examine their internal compliance and reporting systems, codes of conduct and employment agreements in light of the proposed program. Key features are summarized … Continue Reading
Last week, the Canadian Securities Administrators (CSA) published for comment Proposals that would require trade information for all corporate debt securities executed by dealers to be made publicly available, subject to delayed dissemination and volume caps, by the end of 2017. The CSA Proposals aim to enhance the regulation and transparency of the Canadian fixed income market, partly in response to certain limitations highlighted in a Report on “The Canadian Fixed Income Market 2014” published earlier this year by the Ontario Securities Commission which suggested that retail investors in corporate fixed income securities have less access to … Continue Reading
Representatives of the Cooperative Capital Markets Regulatory System (“CCMR”) announced last week a number of developments affecting the proposed national securities regulatory framework:
CCMR launch delayed by one year: Previously scheduled to launch operations later this year, the CCMR is now expected to be operational in the Fall of 2016. The federal government reiterated its intention to move forward with the CCMR initiative in the 2015 federal budget announced earlier this week.
Updated draft legislation and regulations will be published for comment this summer: The CCMR published for public comment in September 2014 consultation drafts of … Continue Reading
CDS Clearing and Depository Services Inc. (“CDS”) published last November proposed amendments to the fees it charges securities issuers for certain services. The new fee regime, which is subject to regulatory approval, is expected to come into effect on April 1, 2015.
CDS services include the issuance of international security identification numbers (“ISINs”), depository eligibility, securities registration-related services and entitlement and corporate action (“E&CA”) event management. CDS currently charges a fee for ISIN issuance, eligibility and registration-related services, but does not charge a fee for E&CA event management.
CDS is proposing the following fee changes:
- Introduce E&CA event management fees
The Ontario Securities Commission (OSC) is inviting comment for the next 90 days on a proposed comprehensive whistleblowing program (the Program) which would award eligible whistleblowers up to $1.5 million for reporting securities law misconduct that leads to significant enforcement or settlement orders.
Yesterday, the OSC published a consultation paper outlining the key features of the proposed whistleblowing program and seeking public input on various aspects of the proposals. During the next 90 days, the OSC will be accepting comments on the consultation paper and will host a roundtable with various stakeholders to discuss the proposals. Before … Continue Reading
On November 27, 2014, the Canadian Securities Administrators (CSA) published proposed amendments to the rights offering regime that aim to make rights offerings more expedient and less costly by creating a streamlined prospectus exemption for reporting issuers (Proposed Exemption). The proposed amendments also aim to increase investor protection with the addition of civil liability for secondary market disclosure and the introduction of a more user-friendly form of rights offering circular document. Finally, the proposed amendments would also update requirements for prospectus-based rights offerings and would repeal the prospectus exemption for rights offerings by non-reporting issuers. This article highlights several of … Continue Reading
Lorsque possibilité et nécessité se rencontrent, les marchés financiers innovent. Le financement participatif a ainsi été créé grâce à la conjugaison de l’avancement technologique actuel et d’un vide créé par la crise financière de 2008.
Le terme financement participatif désigne l’obtention de financement limité d’un nombre important d’investisseurs au service d’un projet précis, d’une entreprise ou de tout autre besoin, le plus souvent par l’intermédiaire d’un portail en ligne. Ce peut être à but lucratif ou non et prendre la forme de dons, de récompenses pour un effort, de prêts entre pairs ou d’émission de titres. Aujourd’hui, les prêts et … Continue Reading
As noted in earlier blog posts here and here, the Ontario Securities Commission (“OSC”) initiated a consultation process in March 2014 on a proposed capital raising prospectus exemption aimed specifically at crowdfunded equity offerings (the “Crowdfunding Exemption”). This proposed exemption may allow businesses in Ontario to access capital (up to a maximum of $1.5 million in equity in any 12-month period) from a potentially large number of investors using an online “portal” platform that would be registered with the securities regulators. Currently, the OSC is in the process of reviewing public comments relating to the … Continue Reading
Saskatchewan and New Brunswick yesterday joined Ontario, British Columbia and the federal government as parties to the national capital markets regulator (“CMR”) agreement in principle first signed in September 2013. As we discussed in a previous article, the proposed cooperative CMR will be responsible for policy development, regulation-making, regulatory operations and enforcement. On the same day, Alberta, Quebec and Manitoba publicly reiterated their opposition to the CMR.
CMR implementation milestones agreed have been pushed out by about six months. By August 2014, a memorandum of agreement will be entered into setting out the terms and conditions of … Continue Reading
On March 20, 2014, the Ontario Securities Commission published four new prospectus exemptions for a 90-day public comment period, including a prospectus exemption for equity crowdfunding (the “Crowdfunding Exemption”). The purpose of this exemption is to allow Canadian businesses, especially start-ups and early stage businesses, to access capital from a potentially large number of investors using an online “portal” platform that would be registered with the securities regulators.… Continue Reading
The following article may be of interest to readers of this blog: OSC Proposes New Rules Requiring Disclosure of Participation of Women on Boards and in Senior Management
As part of the Ontario government’s efforts to foster increased gender diversity on the boards and in the senior ranks of Canada’s largest companies, the Ontario Securities Commission (OSC) recently published for comment until April 16, 2014 proposed amendments to the existing governance disclosure rules contained in National Instrument 58-101 — Disclosure of Corporate Governance Practices (Proposed Amendments) that would require public companies which are Ontario reporting issuers to provide disclosure in … Continue Reading
Canadian securities regulators are moving forward with several rule changes (new MI 45-107 and amendments to NI 33-105) that will facilitate private placement offerings of foreign securities to Canadian institutional investors that qualify as “Canadian permitted clients”. The cumulative effect of the rule changes will be to eliminate the need to prepare a “wrapper document” providing Canada-specific disclosures to supplement the foreign offering document. These rule changes, together with the proposed amendments to OSC Rule 45-501 which were published for comment earlier this year, will make generally available by legislation that will operate across Canada relief that has been … Continue Reading
The Ontario Securities Commission is conducting a broad review of the “exempt market”, in which securities are issued and acquired without the need for a prospectus. The goal of the review is to identify possible new prospectus exemptions that would facilitate capital raising for business enterprises, particularly start-ups and small and medium-sized enterprises.
In a recently published progress report, the OSC summarizes work completed to date and provides a summary of consultations held with various stakeholders. One particularly well-received proposal was the “crowdfunding” exemption, a method of funding a project through small amounts of money raised from a large … Continue Reading
Under Canadian securities law, registered dealers are intended to intermediate orders between customers and marketplaces. Sophisticated marketplace participants maintain a variety of relationships with brokers, some of whom are expected to provide order-routing services rather than advice. These sophisticated participants generate large volumes of orders to buy and sell securities and are concerned with limiting costs and delays in conveying orders to organized marketplaces. Accordingly, accessing marketplaces by direct electronic access (DEA) allows sophisticated marketplace participants, such as institutional traders, to effect their complex trading strategies more efficiently.… Continue Reading