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NOTE: Until rules or instruments become effective as evidenced by their publication in The Alberta Gazette (see section 225 of the Securities Act (Alberta)), they are subject to non-substantive changes. Should such changes occur, a revised version of the relevant rule or instrument will be published on this website.
Industry and public consultation is an important part of the regulatory process and provides good input into new or revised legislation. When the ASC or the Canadian Securities Administrators (CSA) believes new or revised regulation is required, they will typically publish the proposed new documents for public comment.
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March 2019
On March 8, 2018, the Canadian Securities Administrators (we) published for comment proposed amendments to National Instrument 45-106 Prospectus Exemptions (NI 45-106) and National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) and proposed changes to Companion Policy 45-106CP Prospectus Exemptions (45-106CP) relating to syndicated mortgages (the March 2018 Proposal).
The March 2018 Proposal included changes to certain prospectus and registration exemptions available for the distribution of syndicated mortgages, including the following:
- removing the prospectus and registration exemptions under sections 2.36 of NI 45-106 and 8.12 of NI 31-103 for the distribution of syndicated mortgages in Newfoundland and Labrador, the Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island and Yukon;
- introducing additional requirements to the offering memorandum prospectus exemption under section 2.9 of NI 45-106 (the OM Exemption) that would apply if it were used to distribute syndicated mortgages; and
- removing the private issuer prospectus exemption under section 2.4 of NI 45-106 for the distribution of syndicated mortgages.
In light of the comments received on the March 2018 Proposal, we are publishing for a 60-day comment period revised proposed amendments (the Proposed Amendments) to NI 45-106 and NI 31-103 and revised proposed changes (the Proposed Changes) to 45-106CP and to Companion Policy 31-103CP Registration Requirements, Exemptions and Ongoing Registrant Obligations (31-103CP) related to syndicated mortgages. The substantive differences between the Proposed Amendments and the Proposed Changes compared to the March 2018 Proposal include the following:
- Ontario, New Brunswick, Nova Scotia, and Newfoundland and Labrador are proposing a dealer registration and prospectus exemption, and Alberta and Québec are proposing a prospectus exemption, for qualified syndicated mortgages, similar to the exemptions already available in British Columbia under British Columbia Rule 45-501 Mortgages (BCI 45-501);
- Alberta is proposing a prospectus exemption for syndicated mortgages distributed to permitted clients similar to the prospectus exemption for distributions of syndicated mortgages to “institutional investors” under BCI 45-501;
- in relation to the OM Exemption,
- the date of a property appraisal must be within 6 months preceding the date the appraisal is delivered to the purchaser instead of 12 months;
- the proposed mortgage broker certificate has been removed; and additional guidance as to the identity of the issuer of a syndicated mortgage has been added;
- and
- all of the Proposed Amendments and Proposed Changes would come into effect on the same date, rather than the staggered implementation contemplated in the March 2018 Proposal.
Comment period ends: May 14, 2019.
Staff of the Canadian Securities Administrators (CSA Staff or we) have been examining the requirements in National Instrument 21-101 Marketplace Operation (NI 21-101) and in National Instrument 23-101 Trading Rules (NI 23-101) (together, Marketplace Rules) in respect of the reporting of material systems incidents by recognized exchanges (Exchanges) and alternative trading systems (ATSs) (together, Marketplaces) carrying on business in the jurisdictions of the Canadian Securities Administrators (CSA). We have also been reviewing the practices set out around those requirements in various recognition orders, rules and other sources of regulatory guidance. This Notice summarizes the key regulatory requirements with respect to the reporting of a material systems incident by marketplaces and sets out CSA Staff's expectations with respect to incident reporting. The Notice also describes CSA Staff's process for reviewing a marketplace's notification of a material systems incident as well as our role in addressing a material systems incident.
CSA Staff Notice 21-326 Guidance for Reporting Material Systems Incidents
Following the service interruption on April 27, 2018 that affected trading on TSX Inc. (TSX), Alpha Exchange Inc. (Alpha), TSX Venture Exchange Inc. (TSXV) and Bourse de Montréal (MX) (the Incident), CSA Staff undertook a review of the Incident and identified several issues that required further examination and follow up. This notice discusses the issues identified by CSA Staff during the course of, and as a result of, the Incident, through discussions with the affected marketplaces, market participants and the Investment Industry Regulatory Organization of Canada (IIROC), as well as follow-up actions that CSA Staff have taken or intend to take going forward.
CSA Staff Notice 21-325 Follow-up on Marketplace Systems Incidents
The Canadian Securities Administrators published CSA Notice and Request for comment on Proposed National Instrument 25-102 Designated Benchmarks and Benchmark Administrators and Companion Policy on March 14, 2019. The proposed national instrument will create a regulatory regime for benchmarks and benchmarks administrators, among others, in Canada. Specifically, the proposed national instrument is intended to implement a comprehensive regime for:
The comment period will remain open for 90 days until June 12, 2019. We expect to publish the proposed national instrument for a second comment period in relation to a proposed framework to regulate commodity benchmarks later in 2019.
The Canadian Securities Administrators (CSA) have published CSA Consultation Paper 21-402 Proposed Framework for Crypto Asset Trading Platforms (the Consultation Paper). The Consultation Paper seeks feedback on a proposed framework for regulating crypto asset trading platforms that are subject to securities legislation. Comments may be submitted until May 15, 2019.
The Canadian Securities Administrators are publishing a CSA Staff Notice (the Notice) on final amendments to certain custody-related provisions of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103 and the Amendments, respectively). The Amendments are minor but deemed necessary to align the custody-related provisions in NI 31-103 with amendments to National Instrument 81-102 Investment Funds, which came into force on January 3, 2019. The Amendments are anticipated to come into force on June 12, 2019.
The purpose of this consultation paper (the Consultation Paper) is to seek feedback in response to concerns regarding the internalization of retail/small orders within the Canadian equity market. The CSA and IIROC (collectively, we) are publishing the Consultation Paper for a 60-day comment period to solicit views. While there are a variety of competing interests, our underlying goal is to ensure the protection of investors, and to foster fair and efficient capital markets and confidence in capital markets. In addition to the specific questions put forth throughout the Consultation Paper, we invite any general comments you may have in relation to internalization.
Joint CSA/IIROC Consultation Paper 23-406 Internalization within the Canadian Equity Market
Blanket Order 31-505 Registration Exemption for Trades in Connection with Certain Prospectus-Exempt Distributions (BO 31-505), which contains limited relief from the requirement to register for a trade in a security in connection with certain prospectus-exempt distributions known as the Northwestern Exemption, will not be revoked at this time. The Alberta Securities Commission (ASC) is considering possible alternatives to the Northwestern Exemption including amendments to the current exemption. The Notice also provides an update on the where information reports are to be filed under BO 31-505.
Continuation of ASC Blanket Order 31-505February 2019
The CSA is developing a national instrument with the same key features as the start-up crowdfunding exemption orders that certain jurisdictions currently have in place, with a goal of improving the harmonization and effectiveness of crowdfunding as a capital raising tool for start-ups and early stage businesses.
CSA Staff Notice 45-324 Update on the Start-up Crowdfunding Registration and Prospectus Exemptions
The ASC is making amendments (Amendments) to ASC Rule 15-501 Rules of Practice and Procedure for Commission Proceedings. The Amendments will remove some outdated references and create or amend provisions that will further promote the efficient use of scheduled time for hearings.
ASC Notice Amendments to ASC Rule 15-501 Rules of Practice and Procedure for Commission Proceedings