Form 45-106F1 - Report of Exempt Distribution
Form 45-106F1 - Report of Exempt Distribution
What is a report of exempt distribution?
Companies and underwriters must report certain exempt distributions to the OSC by completing and filing Form 45-106F1 Report of Exempt Distribution (Form 45-106F1) through SEDAR+ and pay the applicable filing fees. For most exempt distributions, Form 45-106F1 must be filed no later than 10 days after the distribution. However, for a distribution made in reliance on the prospectus exemption in NI 45-110, Form 45-106F1 must be filed no later than 30 days after the distribution. Additionally, investment funds relying on certain prospectus exemptions have the option of filing Form 45-106F1 on an annual basis, within 30 days of the end of the calendar year. It is important to verify the correct filing deadline for each exempt distribution.
Form 45-106F1 must be filed electronically via SEDAR+ for distributions under:
- section 73.3(2) of the Securities Act (Ontario) [Accredited investor]
- section 73.5(2) of the Securities Act (Ontario) [Government incentive security]
- certain prospectus exemptions in National Instrument 45-106 Prospectus Exemptions
- Multilateral Instrument 45-108 Crowdfunding
- National Instrument 45-110 Start-Up Crowdfunding Registration and Prospectus Exemptions
- Ontario Instrument 45-507 Self-Certified Investor Prospectus Exemption (Ontario Class Order)
Recent updates
On July 20, 2023, members of the CSA issued Coordinated Blanket Order 13-933 Temporary exemption from the requirement to transmit a report of exempt distribution through SEDAR+ in connection with distributions of eligible foreign securities to permitted clients. The blanket orders provide an exemption for a Form 45-106F1 to be filed outside of SEDAR+ in limited circumstances and subject to the conditions of the blanket order.
On June 9, 2023, the CSA revised CSA Staff Notice 45-308 (Revised) Guidance for Preparing and Filing Reports of Exempt Distribution under National Instrument 45-106 Prospectus Exemptions to reflect SEDAR+ and otherwise update the guidance in the notice.
On February 7, 2019, the CSA published a staff notice to clarify when Form 45-106F1 is required to be filed, and fees paid, for exempt distributions involving fully managed accounts.
Guidance on completing and filing Form 45-106F1
Companies that distribute securities using multiple prospectus exemptions may wish to file a single Form 45-106F1. For example, a company may wish to file one Form 45-106F1 for exempt distributions made under prospectus exemptions set out in NI 45-106 and NI 45-110. Where there are different filing deadlines for reports of exempt distributions, the Form 45-106F1 must be filed on or before the earliest filing deadline (that is, no later than 10 days – not 30 days – after the distribution date). Note that a single Form 45-106F1 can be filed for distributions occurring on multiple dates only if such distributions occur within a 10-day period.
Please refer to Part 6 Reporting Requirements of NI 45-106 for other reportable exemptions (i.e. section 2.5 Family, friends and business associates and section 2.9 Offering memorandum).
Generally, companies relying on the Private Issuer exemption (section 73.4(2) of Ontario’s Securities Act) do not need to file a report of exempt distribution provided certain conditions are met. Refer to subsection 2.4(1) of NI 45-106 for the definition of “private issuer”.
When filing Form 45-106F1, accredited investors must select section 2.3 and the relevant subsection on Schedule 1 (as opposed to citing “Other” exemption and section 73.3(2)).
If you are relying on a prospectus exemption in OSC Rule 72-503 and are required to file Form 72-503F, file through SEDAR+.
Additional guidance is provided in the below resources: