With the publication of BC Instrument 13-502, Electronic filing of Reports of Exempt Distribution (the Instrument) and its Companion Policy, 13-502CP (the Companion Policy), the British Columbia Securities Commission (BCSC) has set forth procedures and expectations for the electronic filing of Reports of Exempt Distribution (the exempt distribution reports).
Issuers must file an exempt distribution report when they distribute a security in British Columbia in reliance on specific exemptions from the prospectus requirement. The implementation of BC-13-502 and its Companion Policy means that effective September 30, 2019, the filing of exempt distribution reports payment of any related fees must be made electronically via the BCSC eServices platform, whereas previously, issuers had the option between paper filing or filing electronically.
The Instrument and its allied Companion Policy apply to any issuer when they submit a report of exempt distribution in Form 45-106F1 with the BCSC. Note that the Instrument and Companion Policy only applies to reports under Form 45-106F1. If the issuer has been granted statutory or regulatory relief to make a modified form of exempt distribution report, they must submit it by paper filing.
The Instrument and Companion Policy set out the regulator’s expectations regarding electronic filings:
• If the issuer has not done so already, they must register as an eServices user and create a profile with the BCSC;
• If the issuer is paying a fee for the filing of the report of exempt distribution, they are required to pay the fees at the time, via credit card or electronic funds transfer;
• If the issuer is using an agent, such as its legal counsel, to file a report on its behalf, the agent must log in under their profile and access the issuer’s profile from that point;
• All files must be submitted in Adobe Portable Document Format (.pdf) and must be unsecured. They must preserve any formatting of original files such as in spreadsheets. File sizes should be no larger than 20 MB;
• If the issuer includes scientific or technical information in its offering memorandum, they are required under section 4.2 of National Instrument 43-101 Standards of Disclosure for Mineral Projects (NI 43-101) to file a technical report supporting that scientific or technical information. This report must be filed at the time of the filing of the offering memorandum or before 10th day following the distribution; and,
• If the issuer experiences technical difficulties that prevent them from filing electronically, they can receive a temporary exemption from the BCSC.
BC Instrument 13-502, Electronic Filing of Reports of Exempt Distribution, is available for download from the website of the BCSC.
Companion Policy, 13-502CP Electronic Filing of Reports of Exempt Distribution, is available for download from the website of the BCSC.
For more information, please call Barbara Hendrickson at BAX Securities Law (416) 601 -1004.
This publication is not intended to constitute legal advice. No one should act on it or refrain from acting on it without consulting with a lawyer. BAX does not warrant or guarantee the accuracy or currency or completeness of the publication. No part of this publication may be reproduced without the prior written permission of BAX Securities Law.
