[Withdrawn by CSA Staff Notice 11-341, March 7, 2019] CSA Staff Notice 45-320 - Exemptions for Certain Foreign Issuers from the Requirement to Identify Purchasers as Registrants or Insiders in Reports of Exempt Distribution
[Withdrawn by CSA Staff Notice 11-341, March 7, 2019] CSA Staff Notice 45-320 - Exemptions for Certain Foreign Issuers from the Requirement to Identify Purchasers as Registrants or Insiders in Reports of Exempt Distribution
CSA Staff Notice 45-320
Exemptions for Certain Foreign Issuers from the Requirement to Identify Purchasers as Registrants or Insiders in
Reports of Exempt Distribution
July 7, 2016
Introduction
On April 7, 2016, the Canadian Securities Administrators (the CSA or we) published amendments to National Instrument 45-106 Prospectus Exemptions (NI 45-106), which came into force in all CSA jurisdictions on June 30, 2016.{1} The amendments to NI 45-106 introduced a new harmonized report of exempt distribution, Form 45-106F1 Report of Exempt Distribution (Form 45-106F1).
This Notice addresses the granting of an exemption for certain foreign issuers from the requirement in Schedule 1 of Form 45-106F1 to identify whether a purchaser is a registrant or an insider of the issuer.
Substance and Purpose
In Schedule 1 of Form 45-106F1, issuers and underwriters are required to identify whether a purchaser is a registrant or an insider of the issuer. This requirement is found in clauses (f)1 and (f)2{2} of Schedule 1, respectively. In general, this information is necessary for securities regulators to identify connections between purchasers and issuers, which facilitates our oversight of the exempt market and supports our compliance programs.
Since publication of Form 45-106F1 on April 7, 2016, the CSA has been advised of concerns expressed by foreign issuers and dealers conducting offerings into Canada about the requirement to determine whether a purchaser is a registrant or an insider of the issuer, as those terms are defined under Canadian securities law.
In light of these concerns, relief is being provided from the requirement to disclose whether a purchaser is a registrant or an insider of the issuer if one or more of the following apply:
(a) the issuer is a foreign public issuer;{3}
(b) the issuer is a wholly owned subsidiary of a foreign public issuer;{4}
(c) the issuer is distributing eligible foreign securities only to permitted clients.{5}
This relief aligns with the exemptions already provided to certain foreign issuers in Item 9 and Schedule 2 of Form 45-106F1.
All CSA members, except Ontario, are issuing blanket orders effective June 30, 2016.{6} The blanket orders are available on the websites of the applicable CSA members and a list of the blanket orders is contained in Annex A of this Notice.
As blanket orders are not authorized under Ontario securities law, the Ontario Securities Commission (the OSC) has approved an amendment instrument (the Ontario Amendment) providing the same relief that will amend NI 45-106 in Ontario only. If the Ontario Minister of Finance approves the Ontario Amendment within 60 days of delivery of the Ontario Amendment, it will come into force 15 days after the Ontario Amendment is approved. More detail of the Ontario Amendment is provided in Chapter 5 of the July 7, 2016 OSC Bulletin, and is also available on the OSC website at http://www.osc.gov.on.ca.
Annex to Notice
Annex A -- List of Blanket Orders
Questions
If you have any questions about this Notice, please contact any of the following:
{1} It is expected the amendments to NI 45-106 will come into force in Saskatchewan but not on June 30, 2016.
{2} Clause (f)2 is not applicable if the issuer is an investment fund.
{3} "Foreign public issuer" is defined in Part B1 of Form 45-106F1.
{4} Guidance on what is a wholly owned subsidiary of a foreign public issuer is provided in Item 9 of Form 45-106F1.
{5} "Eligible foreign security" and "permitted client" are defined in Part B1 of Form 45-106F1.
{6} As Saskatchewan's amendments to NI 45-106 will come into force after June 30, 2016, Saskatchewan will issue the blanket order when the amendments are effective.
ANNEX A
LIST OF BLANKET ORDERS