Generated by All in One SEO Pro v5.0.1.1, this is an llms-full.txt file, used by LLMs to index the site. # BAX Securities Law® Award winning corporate securities law firm ## Posts ### [The Latest Corporate Business Law News](https://baxsecuritieslaw.com/news-updates/) **Published:** May 2, 2018 **Author:** Ian **Content:** ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/08/GettyImages-534969258.jpg) --- ### [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-september-toronto-business-lawyers-association-monthly-meeting-2/) **Published:** September 1, 2026 **Author:** Barbara Hendrickson **Content:** Toronto, August 26, 2026: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on **Thursday, September 17, 2026, at 9:30 am** at Chefs Hall, [111 Richmond St. W](https://www.google.com/maps/search/111+Richmond+St.+W?entry=gmail&source=g). in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association (TBLA) was created by Barbara Hendrickson, founder of BAX Securities Law in 2016 to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together for business and professional development purposes. The TBLA meetings are held once a month at 9:30 am at Chefs Hall, [111 Richmond St. W](https://www.google.com/maps/search/111+Richmond+St.+W?entry=gmail&source=g). in downtown Toronto. The TBLA is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. If you would like to attend our **September 17th** meeting, please RSVP to . For more information on the TBLA and its events please contact Barbara at[ ](mailto:bhendrickson@baxsecuritieslaw.com). **Categories:** Business Law, News & Updates --- ### [CSA And CIRO Publish Guidance on Certain Types of Prediction Market Event Contracts](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/) **Published:** September 1, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have published *Joint Canadian Securities Administrators and Canadian Investment Regulatory Organization Staff Notice 91-307, Guidance related to Event Contracts: Compliance with Regulatory Requirements* (the Joint Notice), which provides guidance on certain prediction market contracts. A prediction market is an online platform where people buy and sell contracts against the outcome of future events, turning collective guesses into real-time probability estimates. A number of different online prediction or betting markets exist, including those that specialize in politics, current events, and pop culture. Others specialize in sports outcomes and forecasting macroeconomic and market trends. The Joint Notice clarifies views of the CSA and the CIRO that prediction market contracts should not be regulated within securities and derivatives legislation and it is not appropriate to facilitate or approve an application by their dealer members to trade sports or entertainment-related event contracts. The regulators report that assessment is ongoing regarding the regulatory status of other types of event contracts not addressed by the Joint Notice. Currently two CIRO dealer members have been authorized to facilitate the trading of a limited set of event contracts. These CIRO dealer members must comply with certain terms and conditions set out by CIRO, in consultation with the CSA, and such activity may be subject to further restrictions or other changes in the future. Anyone trading, or facilitating trading, in event contracts that are securities or derivatives must follow applicable requirements under securities and derivatives legislation. *Joint Canadian Securities Administrators and Canadian Investment Regulatory Organization Staff Notice 91-307, Guidance related to Event Contracts: Compliance with Regulatory Requirements* [ is available for download](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/9-derivatives/current/91-307/91307-joint-csa-ciro-notice-august-27-2026) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Business Law, Corporate securities lawyer, News & Updates --- ### [CIRO Publishes Proposed Crypto Trading Platform Regulation Fee Model for Review and Comment](https://baxsecuritieslaw.com/ciro-publishes-proposed-crypto-trading-platform-regulation-fee-model-for-review-and-comment/) **Published:** August 7, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Investment Regulatory Organization (CIRO) has published its *Proposed Crypto Trading Platform Regulation Fee Mode*l (the Proposed Crypto Fee Model) for review and comment for a period ending September 28, 2026. CIRO intends to implement the Proposed Crypto Fee Model, July 1, 2027, in accordance with the CSA Recognition Orders to recover crypto trading platform surveillance costs using an activity-based cost allocation methodology. From July1, 2027, to March 31, 2028, cost recovery will be based on direct costs only. Beginning April 1, 2028, CIRO will transition to full cost recovery as the majority of CIRO members are expected to be registered by that time. Under the Proposed Crypto Fee Model, costs will be allocated using a two-step process. Total surveillance costs are first distributed across levels based on relative supervisory effort and then further allocated to individual members based on their trading activity. The model has three levels, on which members will be placed, based on their individual surveillance requirements. All members would be subject to an annual minimum fee, ranging from $50,000to $100,000 depending on their level, with transitional relief available for certain new level 1 members. *The Proposed Crypto Trading Platform Regulation Fee Model* [ is available for download](https://www.ciro.ca/newsroom/publications/proposed-crypto-trading-platform-regulation-fee-model) from the websites of the Canadian Investment Regulatory Organization. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Crypto lawyer --- ### [CSA Publishes Updated Cybersecurity Findings and Guidance for Registered Firms](https://baxsecuritieslaw.com/csa-publishes-updated-cybersecurity-findings-and-guidance-for-registered-firms/) **Published:** July 27, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) have published *CSA Staff Notice 33-322 Review of Registered Firms’ Cybersecurity Practices and Additional Guidance* (The Staff Notice). The Staff Notice follows a focused compliance examination sweep of 73 registered firms’ cybersecurity practices and sets out observed practices, identified gaps, and updated guidance to support firms in strengthening their cybersecurity frameworks. The examinations covered a range of areas, including cybersecurity policies and procedures, employee training, risk assessments and controls, oversight of third-party service providers and incident response planning. Overall, the CSA found that of the firms examined, particularly the larger firms, had robust cybersecurity policies and procedures. However, the CSA also identified gaps where firms could strengthen their cybersecurity practices. Compliance feedback has been provided to relevant firms for them to address the findings. In addition, the Staff Notice aims to provide practical, scalable guidance to firms of all sizes – including small and medium-sized firms – recognizing that cybersecurity risks and resources vary across registrants. CSA staff advise that they expect firms to have robust cybersecurity practices in place that are relevant to the firm’s business. Registered firms are encouraged to review the notice and assess whether their cybersecurity practices can be strengthened, considering their current operations. *CSA Staff Notice 33-322 Review of Registered Firms’ Cybersecurity Practices and Additional Guidance* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/3/33-322/csa-staff-notice-33-322-review-registered-firms-cybersecurity-practices-and-additional-guidance) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Corporate securities lawyer --- ### [CSA Seeks Comment on Modernizing the Regulation of Public Companies](https://baxsecuritieslaw.com/csa-seeks-comment-on-modernizing-the-regulation-of-public-companies/) **Published:** July 27, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) has published *CSA Consultation Paper 51-406 Modernizing the Regulation of Public Companies* (the Consultation Paper) for a 120-day comment period ending November 13, 2026. The Consultation Paper is seeking stakeholder input on: - whether a revised approach to determining venture and non-venture issuer status could more effectively support proportionate regulation; - whether to exempt some venture issuers from certain aspects of International Financial Reporting Standards; - hold periods applicable to private placements by reporting issuers; - opportunities to streamline and clarify material change reporting; and - how changes to the fundamental requirements in periodic reporting, capital raising and disclosure in the U.S. should inform the Canadian approach. The Consultation Paper also asks for general feedback on other potential changes, such as proposed changes to the regulatory framework that include the addition of targeted adjustments; the introduction of criteria specific to the issuer to determine status; and, the moving of certain issuers who exceed size thresholds from venture exchanges to a non-venture exchange or tier. *CSA Consultation Paper 51-406 Modernizing the Regulation of Public Companies* [ is available for download](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-5/51406-CSA-Consultation-Paper-July-16-2026.pdf?dt=20260715160210) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Governments --- ### [Canadian Securities Administrators Published Amendments to Allow Higher Limits for the Listed Issuer Financing Exemption](https://baxsecuritieslaw.com/canadian-securities-administrators-published-amendments-to-allow-higher-limits-for-the-listed-issuer-financing-exemption/) **Published:** July 27, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) has published proposed amendments to National Instrument 45-106 *Prospectus Exemptions* and changes to the Companion Policy 45-106P (the Proposed Amendments), for a 90-day comment period ending October 21, 2026. The Proposed Amendments seek to codify increases to the amount of funds that qualified listed issuers can raise without a prospectus. They primarily focus on the [2025 blanket order](https://www.securities-administrators.ca/news/csa-expands-capital-raising-options-for-listed-issuers/) (the Blanket Order) that increased the amount that can be raised under the Listed Issuer Financing Exemption (LIFE), from a maximum of $10 million to $25 million – or up to $50 million for larger companies – in a 12-month period, subject to conditions. The Proposed Amendments also respond to feedback received from certain market participants by streamlining other conditions of the exemption. *Proposed Amendments to National Instrument 45-106 Prospectus Exemptions relating to the Listed Issuer Financing Exemption \[CSA Notice and Request for Comment\]* [ is available for download](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/4-distribution-requirements/current/45-106/45106-csa-notice-and-request-for-comment-july-23-2026) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Corporate securities lawyer --- ### [Whistleblowing in Canada](https://baxsecuritieslaw.com/whistleblowing-in-canada/) **Published:** July 2, 2026 **Author:** Barbara Hendrickson **Content:** When news of a whistleblowing award becomes public in Canadian financial circles it usually makes news; not only from the size of the award, but also the very fact that someone has felt it necessary to step forward to bring wrongdoing in the markets to light. The recent announcement by the British Columbia Securities Commission (BCSC) [of the first award under its whistleblowing program i](https://www.bcsc.bc.ca/about/media-room/news-releases/2026/35-bcsc-issues-first-whistleblower-award)s a good example. The award of $25,000 was to an individual whose information contributed to an ongoing enforcement action into suspected misconduct. Across Canada, other regulators have their own whistleblower programs. In 2025, the [Ontario Securities Commission (OSC)’s whistleblower program](https://www.osc.ca/sites/default/files/2026-02/publications_rpt_2025_osc-annual-rpt_en.pdf), which was launched in 2016, made a total of $100,000 in payments to whistleblowers, down from the $1.8 million paid to whistleblowers the previous year, [when it awarded $300,000 to a whistleblower](https://www.newswire.ca/news-releases/osc-awards-300-000-to-whistleblower-who-uncovered-complex-misconduct-837943515.html) who exposed market misconduct. Securities regulators regard whistleblowing as an important tool in uncovering illegal activities that might otherwise have gone undetected. The BCSC, for example, considers a whistleblower as an individual who provides [information that meaningfully contributes](https://www.bcsc.bc.ca/report-to-us/about-the-whistleblower-program) to an investigation of investment fraud and other serious types of market misconduct. Why do whistleblowers act? Studies have shown that whistleblowers will act out of moral concern when making their decision, which ranks above feelings about their employer and fear of reprisal. In fact, concern for others was found to be the [strongest predictor of whistleblowing](https://www.chicagobooth.edu/review/whistle-blowers-act-out-sense-morality). Since whistleblowing is seen as a public service, it is protected by law. In Ontario, for example, whistleblowing is a protected activity under the [Securities Act (Ontario)](https://www.ontario.ca/laws/statute/90s05#BK179) and the [Commodities Futures Act](https://www.ontario.ca/laws/statute/90c20?search=COMMODITY+FUTURES+ACT#BK76), while in British Columbia, it is a protected activity under the [BC Securities Act.](https://www.bclaws.gov.bc.ca/civix/document/id/complete/statreg/00_96418_01) Whistleblowers can make their submissions anonymously or submit their tips via lawyer. Both the [OSC](https://www.osc.ca/en/enforcement/osc-whistleblower-program/submit-whistleblower-report) and [BCSC](https://integritycounts.ca/org/BCSC) maintain special whistleblowing portals on their websites where tips may be submitted. Securities regulars will work to preserve the anonymity of whistleblowers. Reprisals against whistleblowers which may take the form of disciplinary measures, demotions, or termination, are taken very seriously. The Securities Act (Ontario) has specific anti-reprisal provisions in subsections 121.5(1), which forbids reprisals against employees who engage in whistleblowing, 121.5(2), which sets out what constitutes a reprisal, and 121.5(4), which provides a legal remedy for employees believing they have been targeted for reprisal. Reprisals against whistleblowers are similarly mandated against under section 168.04 of the BC *Securities Act.* In a [recent Ontario case](https://www.dlapiper.com/en-ca/insights/publications/2025/10/ontario-superior-court-clarifies-anti-reprisal-protections-under-the-securities-act), *McPherson v Global Growth Assets Inc*., an employer was found to have unlawfully terminated staff in reprisal for voicing concerns about compliance and was heavily penalized for their actions. In deciding upon a monetary reward for the whistleblowing activity, regulators will consider the conditions surrounding the action, including the level of personal risk the whistleblower undertook, the timing of the report, the severity the misconduct, and the level of information and cooperation the whistleblower provides. They will also determine if the report meets eligibility criteria, which generally means that the information must be truthful, and that the person must not have been contacted by the regulator previously about the incident, and that they are not a staff member of the regulatory organization. The type of tips that may be submitted as whistleblower claims vary. It may stem from something as simple as a disclosure document that doesn’t “sit right” with an investor or comments overheard during a social gathering. Or they may be more specific, such as activities that staff members witness or are asked to participate in. Securities regulators rely upon whistleblowers as part of ensuring a culture of compliance. They serve as the first line of defence in ensuring a fairer and more open marketplace, both protecting investors and market integrity and confidence. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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, currency or completeness of the publication. No part of this publication may be reproduced without the prior written permission of BAX Securities Law. **Categories:** Financial, News & Updates --- ### [Canadian Securities Administrators Publish Amendments to National Instrument 81-105 Mutual Fund Sales Practices and Other Instruments and Policies Relating to Principal Distributors](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-amendments-to-national-instrument-81-105-mutual-fund-sales-practices-and-other-instruments-and-policies-relating-to-principal-distributors/) **Published:** June 23, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) recently announced the publication of final amendments to the principal distributor model (the Final Amendments) in the distribution of mutual fund securities. The Final Amendments clarify that a dealer may act as principal distributor only for mutual funds in the same mutual fund family. They do not affect the ability of a principal distributor to also distribute mutual fund securities as a participating dealer to multiple mutual fund families. The Final Amendments also enhance transparency by requiring disclosure of principal distributor arrangements and related compensation in the prospectus, fund facts document. and the annual report on charges and other compensation. The Final Amendments include the following amendments (the Amendments) to: - National Instrument 31-103 Registration Requirements, Exemptions and Ongoing - Registrant Obligations (NI 31-103), - National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101), - National Instrument 81-102 Investment Funds (NI 81-102), and - National Instrument 81-105 Mutual Fund Sales Practices (NI 81-105). and the following changes (the Changes) to: - Companion Policy 31-103 *Registration Requirements, Exemptions and Ongoing* - *Registrant Obligations* (**31-103CP**), - Companion Policy 81-102 *Investment Funds* (**81-102CP**), and - Companion Policy 81-105 *Mutual Fund Sales Practices* (**81-105CP**). In some jurisdictions, ministerial approvals are required for the implementation of the Final Amendments. Provided all ministerial approvals are obtained, the Amendments to NI 31-103 will come into force on January 1, 2027, and the Amendments to NI 81-101, NI 81-102, and NI 81-105 will come into force on October 1, 2026. The Changes to 31-103CP will take effect on January 1, 2027, and the Changes to 81-102CP and 81-105CP will take effect on October 1, 2026. However, there are transition periods provided for the Amendments to NI 31-103, NI 81-101 and NI 81-105. The Final Amendments [ are available for download](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-8/81105-CSA-Advance-Notice-June-11-2026.pdf?dt=20260610000001) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Corporate securities lawyer, Securities litigation lawyer --- ### [BCSC Issues its First Whistleblower Award](https://baxsecuritieslaw.com/bcsc-issues-its-first-whistleblower-award/) **Published:** June 23, 2026 **Author:** Barbara Hendrickson **Content:** The British Columbia Securities Commission (BCSC) has made its first whistleblower award of $25,000 to an individual whose information contributed to an ongoing enforcement action into suspected misconduct. The award marks the first payout under the BCSC’s whistleblower program, which provides financial incentives to individuals who provide information that meaningfully contributes to an investigation of investment fraud and other serious types of market misconduct. The BCSC gives awards for information leading to specific types of enforcement action, including a halt trade order, preservation orders and formal allegations. To protect the whistleblower’s identity, the BCSC does not disclose details about the specific enforcement action nor the nature of the suspected misconduct. The BCSC’s Whistleblower Program is unique, in that unlike programs of other securities regulators, it pays awards for ongoing enforcement matters, rather than at the conclusion of a hearing. Financial awards range from $1,000 to a maximum of $500,000, depending on factors such as how quickly the information was reported, how much it contributed to the investigation, and the seriousness of the misconduct. The program was launched in November 2023 to reinforce the BCSC’s efforts to detect misconduct sooner and disrupt it more quickly. To be eligible for an award, whistleblowers must provide information about someone else’s wrongdoing. Those reporting only their own misconduct are not eligible for a whistleblower award but may qualify for credit for cooperation under a separate BCSC policy. Whistleblowers can submit tips through a secure online portal, by mail, or by phone. Tips can be submitted anonymously, though whistleblowers must reveal their identity to the BCSC before receiving a financial award. For more information on the BCSC whistleblower program, [click here](https://www.bcsc.bc.ca/report-to-us/about-the-whistleblower-program). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Corporate securities lawyer, Governments --- ### [BCSC Publishes Notice of Revised British Columbia Securities Commission Policy Hearings](https://baxsecuritieslaw.com/bcsc-publishes-notice-of-revised-british-columbia-securities-commission-policy-hearings/) **Published:** June 23, 2026 **Author:** Barbara Hendrickson **Content:** The British Columbia Securities Commission (BCSC) has approved revised procedures for hearings under the [Securities Act](https://www.bclaws.gov.bc.ca/civix/document/id/complete/statreg/00_96418_01) (the Act), effectively immediately. Those procedures are set out in BCP 15-601 Hearings (the Policy). The amendments to BCP 15-601 adopt a new practice of deleting records in closed files that were not entered into evidence during the hearing. *Notice of Revised British Columbia Securities Commission Policy 15-601 Hearings* is [available for download ](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/BCN/BCN-202604-June-3-2026.pdf?dt=20260603170940) from the website of the British Columbia Securities Commission. *BCP 15-601 Hearings* is [*available for download*](hhttps://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/1-procedure-related-matters/current/15-601) from the website of the British Columbia Securities Commission*.* For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Business lawyer, Governments --- ### [Canadian Securities Exchange Publishes Proposed Public Interest Rule Amendments – Proposed – Request for Comments](https://baxsecuritieslaw.com/canadian-securities-exchange-publishes-proposed-public-interest-rule-amendments-proposed-request-for-comments/) **Published:** June 23, 2026 **Author:** Barbara Hendrickson **Content:** CNSX Markets Inc., operator of the Canadian Securities Exchange (CSE) is proposing amendments (the Proposed Amendments) to the CSE Listing Policies (the Policies) and have made then available for comment for a period ending July 6, 2026. The Proposed Amendments remove the requirement for Listed Issuers to complete and file a Monthly Progress Report (Form 7) and to repeal Form 7: Monthly Progress Report. Previously, Listed Issuers were required to provide summary information no later than five (5) trading days after the end of each month. Form 7 was never intended to replace the Listed Issuer’s obligation for timely disclosure. The Proposed Amendments will become effective following regulatory approval. *Canadian Securities Exchange Public Interest Rule Amendments Proposed Amendments to CSE Listing Policies Notice and Request for Comment* [ is available for download](https://www.osc.ca/en/industry/market-regulation/marketplaces/exchanges/recognized-exchanges/canadian-securities-exchange-cse-rule-review-notices/notice-and-request-34#msdynmkt_trackingcontext=37125d28-2067-49d5-b5ec-544624010200&msdynmkt_prefill=mktprf6910b4b592b246f0a5d253a6834c9f86eoprf) from the websites of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Business lawyer, Corporate securities lawyer --- ### [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-toronto-business-lawyers-association-monthly-meeting/) **Published:** June 2, 2026 **Author:** Barbara Hendrickson **Content:** Toronto, June 1, 2026: BAX Securities Law is pleased to announce the 10th year anniversary of the Toronto Business Lawyers Association (TBLA). The TBLA was created by Barbara Hendrickson, founder of BAX Securities Law, to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together for business and professional development purposes. The TBLA meetings are held once a month at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto. The TBLA is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. We invite friends and colleagues to the next meeting on Thursday, June 18, 2026, at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto (Lost Coffee area). If you would like to attend this month’s meeting, please RSVP to . For more information on the TBLA and its events please contact Barbara at[ ](mailto:bhendrickson@baxsecuritieslaw.com). **Categories:** Business Law --- ### [CSA Publishes Proposed Amendments and Changes to Enhance Issuer Bid, Take- Over Bid, and Beneficial Ownership Reporting Regimes](https://baxsecuritieslaw.com/csa-publishes-proposed-amendments-and-changes-to-enhance-issuer-bid-take-over-bid-and-beneficial-ownership-reporting-regimes/) **Published:** June 1, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) including the Ontario Securities Commission (OSC) recently published *CSA Notice and Request for Comment Proposed Amendments and Changes to the Issuer Bid, Take-Over Bid and Beneficial Ownership Reporting Regimes* (the Proposed Amendments), which seeks to enhance the Canadian issuer bid, take-over bid, and beneficial ownership reporting regimes. The deadline for comments is August 12, 2026. In general, the Proposed Amendments and changes would: - introduce a new issuer bid exemption to allow selective repurchases by an issuer of securities of its own issue, subject to certain parameters; - require enhanced disclosure with respect to interests in derivatives that substantially replicate the economic consequences of ownership and other agreements, arrangements, or understandings that have the effect of altering economic exposure to an issuer in the context of take-over bids and proxy solicitations for which an information circular is required to be sent; - provide further guidance on the circumstances where the disclosure or use of equity equivalent derivatives may engage the public interest jurisdiction of securities regulatory authorities; - provide guidance on the appropriate timing of disclosure of an acquiror’s “plans or future intentions” in an early warning report; specify filing requirements and clarify the appropriate application or interpretation of certain provisions in respect of take-over bids, issuer bids, and the early warning reporting regime; and, - address certain issues of a targeted or housekeeping nature related to circumstances where exemptive relief is currently required. *CSA Notice and Request for Comment Proposed Amendments and Changes to the Issuer Bid, Take-Over Bid and Beneficial Ownership Reporting Regimes* [is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/5/51-102/csa-notice-and-request-comment-proposed-amendments-and-changes-issuer-bid-take-over-bid-and) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Capital markets lawyer --- ### [CSA Issues Temporary Exemptions from Collection of Certain Personal Registration Information](https://baxsecuritieslaw.com/csa-issues-temporary-exemptions-from-collection-of-certain-personal-registration-information/) **Published:** June 1, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) including the Ontario Securities Commission (OSC) has published *Coordinated Blanket Order 33-930 Exemptions from Requirements to Submit Certain Personal Information* (the Coordinated Blanket Order), which provides temporary exemptions under National Instrument 33-109 Registration Information. The coordinated blanket order came into effect on May 1, 2026, and will act as an interim measure until NI 33-109 is formally amended. Under NI 33-109, registered firms and individuals acting on their behalf are required to submit certain personal information when applying for individual registration or seeking review as a permitted individual. This information is used by the CSA to assess an individual’s identity and fitness for registration or permitted individual status. The coordinated blanket order removes certain requirements to provide personal information that the CSA has determined is not required for identification in this context. In Manitoba and Ontario, similar relief relating to the collection of certain personal information will also be granted concurrently under commodity futures legislation in their respective jurisdictions. In Québec, similar relief relating to the collection of certain personal information will also be granted contemporaneously under derivatives legislation. *Coordinated Blanket Order 33-930 Exemptions from Requirements to Submit Certain Personal Information* [ is available for download](https://www.securities-administrators.ca/news/csa-issues-temporary-exemptions-from-collection-of-certain-personal-registration-information/#33930) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Securities lawyer, Securities litigation lawyer --- ### [BCSC Publishes Update to NI 81-106, Investment Fund Continuous Disclosure](https://baxsecuritieslaw.com/bcsc-publishes-update-to-ni-81-106-investment-fund-continuous-disclosure/) **Published:** June 1, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) including the Ontario Securities Commission (OSC) has published an update to *National Instrument 81-106, Investment Fund Continuous Disclosure (NI 81-106*). Significant amendments to NI 81-106, which is the primary Canadian securities regulation that governs and mandates the continuous disclosure, financial reporting and filing requirements for all Canadian issuers, were published in April, concurrent with the Canadian Securities Administrators’ (CSA) Continuous Disclosure (CD) Modernization Project. The updates reduce regulatory burdens, align with International Financial Reporting Standards (IFRS), and eliminate redundant investor reporting. *National Instrument 81-106, Investment Fund Continuous Disclosure* [ is available for download](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-8/81106-NI-April-22-2026.pdf?dt=20260416195212). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Business lawyer, Financial --- ### [Canadian Securities Regulators Announce Adoption of Semi-Annual Financial Reporting Pilot](https://baxsecuritieslaw.com/canadian-securities-regulators-announce-adoption-of-semi-annual-financial-reporting-pilot/) **Published:** June 1, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) including the Ontario Securities Commission (OSC) have adopted a pilot project to allow eligible venture issuers to voluntarily adopt a semi-annual financial reporting framework (the SAR Pilot), subject to the terms and conditions in the *Coordinated Blanket Order 51-933 Exemption to Permit Semi-Annual Reporting for Certain Venture Issuers* (the Blanket Order). The SAR Pilot provides an exemption for eligible venture issuers listed on the TSX Venture Exchange Inc. (TSXV) or the CNSX Markets Inc. (CSE) from the requirement to file first- and third-quarter financial reports under National Instrument 51-102 *Continuous Disclosure Obligations*. While the Blanket Order is in effect, the CSA intends to engage in a broader rule-making project related to voluntary semi-annual financial reporting for eligible reporting issuers and will use learnings from the SAR Pilot to inform that project. *Coordinated Blanket Order 51-933 Exemption to Permit Semi-Annual Reporting for Certain Venture Issuers* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/5/51-933/csa-notice-coordinated-blanket-order-51-933-exemptions-permit-semi-annual-reporting-certain#msdynmkt_trackingcontext=a746ba03-f631-4f0c-8a89-66c9d40c0200&msdynmkt_prefill=mktprfea7810bdfe2d4b1fb6efe7580730faaeeoprf) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [OSC, AMF Québec, And AMF France Agree to Support Cross-Listing of Securities in Canada and France](https://baxsecuritieslaw.com/osc-amf-quebec-and-amf-france-agree-to-support-cross-listing-of-securities-in-canada-and-france/) **Published:** June 1, 2026 **Author:** Barbara Hendrickson **Content:** Securities regulators in Ontario, Quebec, and France have signed off on the *Agreement to facilitate the cross-listing of securities in France and Canada between the Ontario Securities Commission and the Autorité des marchés financiers of Québec and the Autorité des marchés financiers of France* (the Agreement) which will permit the initial cross-listing of securities on an exchange, by way of prospectus, in Canada and France. The participating jurisdictions are the Ontario Securities Commission (OSC), the Autorité des marchés financiers in Québec (AMF Québec and the Autorité des Marchés Financiers in France (AMF France). Under the Agreement, Canadian and French companies seeking to cross-list their securities in France and Canada by way of a prospectus will have to comply with the regulatory requirements of both countries and applicable exchange requirements. The agreement does not provide regulatory relief. However, Canadian and French companies will benefit from increased support and assistance from the AMF Québec, OSC and AMF France throughout the prospectus review process. *Agreement to facilitate the cross-listing of securities in France and Canada between the Ontario Securities Commission and the Autorité des marchés financiers of Québec and the Autorité des marchés financiers of France* [ is available for download](https://www.osc.ca/en/about-us/domestic-and-international-engagement/international-mous/agreement-facilitate-cross-listing-securities-france-and-canada-between-ontario#msdynmkt_trackingcontext=cfc9271f-e0c6-4541-b97e-62a4b5330100&msdynmkt_prefill=mktprfcfdcd24c87474267b017d02aa77bedd0eoprf) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Governments --- ### [CSA Announces Adoption of Final Amendments to Trading Fee Caps](https://baxsecuritieslaw.com/csa-announces-adoption-of-final-amendments-to-trading-fee-caps/) **Published:** June 1, 2026 **Author:** Barbara Hendrickson **Content:** Provided all necessary ministerial approvals are obtained, the Canadian Securities Administrators (CSA) advises that final amendments to *National Instrument 23-101 Trading Rules and changes to Companion Policy 23-101 Trading Rules* (the Final Amendments), will come into force on November 2, 2026. The Final Amendments lower the maximum fee for executing an order involving trades in securities priced at CAD $1.00 or more, listed on both a Canadian recognized exchange and a U.S. registered national securities exchange. Following this change, all securities priced at CAD $1.00 or more will have an active trading fee cap of CAD $0.0017. The CSA will monitor the impact of the change in the fee cap over time and assess if further changes to the fee cap are required. Any further changes will be subject to public consultation. The regulator received 10 responses to the request for comment published January 23, 2025. *National Instrument 23-101 Trading Rules and changes to Companion Policy 23-101 Trading Rules* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/2/23-101/csa-notice-amendments-national-instrument-23-101-trading-rules-and-changes-companion-policy-23-101#msdynmkt_trackingcontext=1595f00f-0167-431a-bd22-2c5bc91a0200&msdynmkt_prefill=mktprf553ece39685746b085d7540495ac97e4eoprf) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial --- ### [CSA Multilateral Staff Notice 51-347: Disclosure of Cyber Security Risks and Incidents](https://baxsecuritieslaw.com/csa-multilateral-staff-notice-51-347-disclosure-cyber-security-risks-incidents/) **Published:** November 24, 2017 **Author:** Barbara Hendrickson **Excerpt:** In January 2017, the Canadian Securities Administrators (the “CSA”) published CSA Multilateral Staff Notice 51-347: Disclosure of Cyber Security Risks and Incidents (the “Staff Notice”), the findings of a review of the disclosure provided by the constituents of the S&P/TSX Composite Index regarding cyber security... **Content:** In January 2017, the Canadian Securities Administrators (the “**CSA**”) published *CSA Multilateral Staff Notice 51-347: Disclosure of Cyber Security Risks and Incidents* (the “**Staff Notice**”), the findings of a review of the disclosure provided by the constituents of the S&P/TSX Composite Index regarding cyber security risk and cyber attacks. The review found that 61% of the constituents of the S&P/TSX Composite Index acknowledged cyber security as a material risk to their business. Issuers in a wide variety of industries generally disclosed that their dependence on information technology systems renders them at risk for cyber security breaches and that disruptions due to cyber security incidents could adversely affect their business, results of operation, and financial condition. These risks included but were not limited to, compromising of confidential customer or employee information; unauthorized access to proprietary or sensitive information; destruction or corruption of data; lost revenues due to a disruption of activities, incurring of remediation costs; and, litigation, fines and liability for failure to comply with privacy and information security laws. The staff notice also provides guidance on risk factor disclosure and incident reporting, confirming the expectations raised in *Staff Notice 11-332: Cyber Security* (“**Staff Notice 11-332**”), addressing how in any cyber attack remediation plan, the materiality of an attack would be assessed to determine whether and what, as well as when and how, to disclose in the event of an attack. As issuers increasingly depend on information technology, and as cyber attacks become more frequent and sophisticated, the CSA expects that issuers will consider their exposure to cyber security risks when preparing their risk factor disclosure. The CSA has long been concerned over the status of cyber security of issuers, registrants and regulated entities, and their ability to withstand cyber attacks, having identified cyber security as a priority area in its 2016-2019 Business Plan. The Staff Notice reports the findings of a review announced by the CSA in *Staff Notice 11-332* and provides disclosure expectations for reporting issuers based on those findings. *Staff Notice 11-332*, published in September 2016, highlighted the importance of cyber security risks for issuers, registrants and regulated entities, and informed stakeholders about recent and upcoming CSA initiatives. With respect to issuers, *Staff Notice 11-332* indicated that CSA members would examine the disclosure of some of the larger issuers to analyze what is being disclosed with respect to cyber security risk and cyber attacks. *Staff Notice 51-347* is the result of that examination. *CSA Multilateral Staff Notice 51-347:* *Disclosure of Cyber Security Risks and Incidents,* is [available for download](https://www.osc.gov.on.ca/documents/en/Securities-Category5/20170119_51-347_disclosure-cyber-security.pdf) from the websites of participating member jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates, Securities litigation lawyer --- ### [Two ICO issuers settle with SEC, Agree to Register Tokens as Securities](https://baxsecuritieslaw.com/two-ico-issuers-settle-with-sec-agree-to-register-tokens-as-securities/) **Published:** December 10, 2018 **Author:** Barbara Hendrickson **Excerpt:** In late November, 2018, the U.S. Securities and Exchange Commission (SEC) settled registration charges with two issuers of Initial Coin Offerings (ICOs), CarrierEQ Inc. (Airfox) and Paragon Coin Inc. (Paragon). These were the SEC’s first cases imposing civil penalties solely for ICO securities offering registration... **Content:** In late November, 2018, the U.S. Securities and Exchange Commission (SEC) settled registration charges with two issuers of Initial Coin Offerings (ICOs), CarrierEQ Inc. (Airfox) and Paragon Coin Inc. (Paragon). These were the SEC’s first cases imposing civil penalties solely for ICO securities offering registration violations. The SEC found that neither Airfox nor Paragon registered their ICOs under U.S. federal securities laws, nor did they qualify for an exemption to the registration requirements. According to the SEC, both Airfox and Paragon conducted ICOs in 2017 after the Commission warned that ICOs can be securities offerings in its [DAO Report of Investigation](https://www.sec.gov/litigation/investreport/34-81207.pdf). Without admitting or denying the orders against them, Airfox and Paragon have consented to the orders and have agreed to return funds to investors, register the tokens as securities under the Securities Exchange Act of 1934, and file periodic reports for at least one year with the Commission. In addition, each company has agreed to pay $250,000 USD in penalties. Airfox, a Boston-based startup, raised approximately $15 million worth of digital assets to finance its development of a token-denominated “ecosystem” starting with a mobile application that would allow users in emerging markets to earn tokens and exchange them for data by interacting with advertisements. Paragon, an online entity, raised approximately $12 million worth of digital assets to develop and implement its business plan to add blockchain technology to the cannabis industry and work toward legalization of cannabis. The notice, along with the related orders [is available for download](https://www.sec.gov/news/press-release/2018-264) from the SEC website. 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. **Categories:** News & Updates, Securities litigation lawyer **Tags:** BAX Securities Law, Cryptocurrency, Fintech, ICO, SEC --- ### [NextBlock Global Limited and Alex Tapscott Fined by OSC and SEC](https://baxsecuritieslaw.com/nextblock-global-limited-and-alex-tapscott-fined-by-osc-and-sec/) **Published:** May 17, 2019 **Author:** Barbara Hendrickson **Excerpt:** On May 14, 2019, the Ontario Securities Commission (OSC) and the Securities and Exchange Commission (SEC) concluded separate settlement agreements with Toronto-based NextBlock Global Limited (NextBlock) and its chief promoter, Alex Tapscott over the making of misleading statements. In June of 2017, Tapscott, who served... **Content:** On May 14, 2019, the Ontario Securities Commission (OSC) and the Securities and Exchange Commission (SEC) concluded separate settlement agreements with Toronto-based NextBlock Global Limited (NextBlock) and its chief promoter, Alex Tapscott over the making of misleading statements. In June of 2017, Tapscott, who served as NextBlock’s CEO, founded the company, along with three others, for the purpose of investing in blockchain companies and related digital assets. The company solicited investment through a private placement of convertible debentures, ultimately raising $20 million (CAD) from 113 Canadian accredited investors and $2.4 million (USD) from a smaller group of U.S. investors. As CEO, Tapscott led the fundraising effort and was responsible for communicating with investors and developing and maintaining slide decks used to market the business to potential investors. However, on the slide decks, NextBlock and Tapscott had stated that four recognized experts in the blockchain industry – three in the U.S., one in Canada – were advising NextBlock, where in reality they were not. None of these individuals had ever agreed to serve as advisors to NextBlock. This misrepresentation served as a major part of the company’s ongoing marketing efforts. Late in November 2017, media reports began to surface regarding Tapscott and NextBlock’s misrepresentation. At the time, the company had hired two Canadian investment banks for a planned public placement on the TSX and was in the middle of a second fundraising round. Following this disclosure, the company abandoned its plans and began court proceedings to cease operations, returning to investors their principal plus investment interest (140% in March 2019). Tapscott at the same time voluntarily surrendered his $3 million (CAD) share in NextBlock’s interest that would’ve been ordinarily his. The misrepresentations Tapscott and NextBlock made were contrary to Sections 127 and 127.1 of the Securities Act, RSO 1990, c S.5 (the Securities Act). However, reflecting the steps Tapscott took in order to remedy the situation, the OSC reached a settlement, which saw the company paying an administrative penalty of $700,000 (CAD) plus $100,000 (CAD) toward the costs of the OSC’s investigation. Tapscott will also pay an administrative penalty of $300,000 (CAD). Additionally, Tapscott has agreed to perform community service at Canadian business schools by delivering presentations on ethics and the importance of complying with securities law. He has also agreed to publish an open letter in a national news publication about the impact of his misconduct. The SEC reached its own settlement with Tapscott and NextBlock. The SEC had found the company and its CEO were in violation of the Securities Act of 1933. The company voluntarily consented to the filing of a cease-and-desist order by the regulator. In addition, the SEC, bearing in mind the actions taken by Tapscott and the agreement reached with the OSC, imposed a $25,000 (USD) fine. *In the Matter of NextBlock Global Limited and ALEX TAPSCOTT, ORAL REASONS FOR APPROVAL OF A SETTLEMENT (Sections 127 and 127.1 of the Securities Act, RSO 1990, c S.5*) [is available for downloaded](https://www.osc.gov.on.ca/documents/en/Proceedings-OTH/oth_20190513_nextblock-global.pdf) from the website of the Ontario Securities Commission. *In the Matter of NextBlock Global Limited and ALEX TAPSCOTT, Order Instituting a Cease-and-Desist Proceedings Pursuant to Section 8A of the Securities Act of 1933, Making Findings, and Imposing a Cease-and-Desist Order*, [is available for download](https://www.sec.gov/litigation/admin/2019/33-10638.pdf) from the website of the Securities and Exchange Commission. 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. **Categories:** Marketing & Business Development, News & Updates, Securities litigation lawyer **Tags:** Alex Tapscott, Barbara Hendrickson, BAX Securities Law, Blockchain, Next Block Global, OSC, SEC --- ### [British Columbia Securities Regulators Publish BC Instrument 33-521, Relief from sections of NI 33-109 Registration Information related to obligations to fill out specific forms](https://baxsecuritieslaw.com/british-columbia-securities-regulators-publish-bc-instrument-33-521-relief-from-sections-of-ni-33-109-registration-information-related-to-obligations-to-fill-out-specific-forms/) **Published:** January 7, 2026 **Author:** Barbara Hendrickson **Content:** The British Columbia Securities Commission (BCSC) has published *BC Instrument 33-521, Relief from sections of NI 33-109 Registration Information related to obligations to fill out specific forms* (the Relief Order). The Relief Order, which is effective January 1, 2026, grants individuals in British Columbia seeking registration or reinstatement of registration an exemption from submitting Item 6 and Item 8 number 2 of Form 33-109F4 and Item 3 of Form 33-109F7 provided the individuals seeking registration or reinstatement of registration submit the forms electronically on the National Registration Database (NRD). *BC Instrument 33-521, Relief from sections of NI 33-109 Registration Information related to obligations to fill out specific forms*[ is available for download](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-3/33521-BCI-December-23-2025.pdf?dt=20251222231715) from the website of the British Columbia Securities Commission. *NI 33-109, Registration Information* [ is available for download](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/3-registration-requirements-related-matters/current/33-109) from the website of the British Columbia Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Governments, Securities lawyer --- ### [BAX Securities Law Announces January Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-january-toronto-business-lawyers-association-monthly-meeting-2/) **Published:** January 8, 2026 **Author:** Barbara Hendrickson **Content:** Toronto, January 7, 2026: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday, January 22, 2026, at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson, founder of BAX Securities Law, over eleven years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together for business and professional development purposes. The TBLA meetings are held once a month at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. If you would like to attend this month’s meeting, please RSVP to Barbara Hendrickson at . Happy New Year and we hope you can join us on January 22nd. For more information on the TBLA and its events please contact Barbara at . **Categories:** News & Updates, Securities lawyer --- ### [Canadian Securities Regulators Announce Updated Derivatives Trade Reporting FAQs](https://baxsecuritieslaw.com/canadian-securities-regulators-announce-updated-derivatives-trade-reporting-faqs/) **Published:** February 4, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) have published *CSA Staff Notice 96-307 (Revised)Frequently Asked Questions about Derivatives Trade Reporting* (the Staff Notice). The Staff Notice revises a list of frequently asked questions (FAQs) received by the CSA about derivatives trade reporting rules, as amended by amendments published on July 25, 2024 and came into force on July 25, 2025. The purpose of the FAQs is to provide clarity about how the trade reporting rules should be implemented, while preserving flexibility to the extent possible for reporting counterparties and trade repositories to operationalize these requirements in the context of their business frameworks. The list of FAQs is not exhaustive but includes key issues and questions that market participants have posed to the regulator since publication of the amendments, along with its current views. CSA Staff note that they will continue to update these FAQs as necessary. *CSA Staff Notice 96-307 (Revised)Frequently Asked Questions about Derivatives Trade Reporting* [ is available for download](https://www.securities-administrators.ca/wp-content/uploads/2026/01/CSA-Staff-Notice-96-307.pdf) from the website of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial, Governments, Securities lawyer --- ### [Canadian Securities Regulators Greenlight Project Samara](https://baxsecuritieslaw.com/canadian-securities-regulators-greenlight-project-samara/) **Published:** March 6, 2026 **Author:** Barbara Hendrickson **Content:** The Ontario Securities Commission (OSC), the Autorité des marchés financiers (AMF) and the Canadian Investment Regulatory Organization (CIRO) (the Canadian Securities Regulators), have granted approval for Project Samara, an experimental tokenization research project conducted by a consortium that includes RBC Dominion Securities Inc., a member of RBC Capital Markets (RBC), RBC Investor Services Trust, the TD Securities division of the Toronto Dominion Bank, TD Securities Inc., the Bank of Canada (BoC), and Export Development Canada (EDC) (the Consortium). Project Samara will evaluate a platform operated by RBC that uses distributed ledger technology to support end-to-end transactions throughout the bond lifecycle, including “tokenized” bond issuance by EDC, bidding, coupon payment, redemption, secondary trading, in addition to the settlement of bond trades using digital representations of wholesale Canadian dollars created and managed by the BoC on the distributed ledger. The Consortium will publish the key findings in a research report assessing the benefits of issuing and trading bonds using distributed ledger technology. The Canadian Securities Regulators have granted the Consortium novel exemptive relief to allow Project Samara to proceed. The relief was granted through the OSC LaunchPad, allowing the consortium to conduct research into tokenization. LaunchPad is a support program of the OSC’s Innovation Office that assists businesses with new products, services, or applications that benefit investors. There is a growing international consensus among regulators that they must harmonize regulatory policies towards tokenization, while simultaneously managing the risks and unlocking the benefits of the new technology. Financial institutions and asset managers are launching tokenized products, while central banks and regulators are exploring new ways to support innovation while protecting investors and safeguarding financial stability. The Canadian Securities Administrators (CSA) have also been active in this area, recently launching Project Tokenization, [a new theme in its CSA Collaboratory](https://www.securities-administrators.ca/csa-activities/csa-finhub/collaboratory/). This initiative aims to collaborate with stakeholders to examine issues arising from the use of tokenized products and their intersection with Canadian securities laws, supporting informed, coordinated responses to innovation in the capital markets. *Decision: in the matter of RBC Securities* [ is available for download](https://www.osc.ca/sites/default/files/2026-03/ord_20260302_project-samara.pdf) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Corporate securities lawyer, FSRA, Governments, OSC, Securities lawyer --- ### [BAX Securities Law Announces May Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-may-toronto-business-lawyers-association-monthly-meeting-4/) **Published:** May 8, 2026 **Author:** Barbara Hendrickson **Content:** Toronto, May 5, 2026: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday, May 21, 2026, at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson, founder of BAX Securities Law, over eleven years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together for business and professional development purposes. The TBLA meetings are held once a month at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. If you would like to attend this month’s meeting, please RSVP below. For more information on the TBLA and its events please contact Barbara at . Business Lawyers Association Monthly Meeting **LOCATION** Chefs Hall – 111 Richmond St. W., Toronto (Lost Coffee area) **DATE AND TIME** 05/21/26 9:30am – 05/21/26 10:30am US/Eastern Business Lawyers Association May 21st Meeting **Categories:** Business lawyer, News & Updates, Securities lawyer --- ### [Canadian Securities Regulators Publish CSA Staff Notice 25-303 2021 CSA Annual Activities Report on the Oversight of the Self-Regulatory Organizations (SROs) and Investor Protection Funds (IPFs)](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-csa-staff-notice-25-303-2021-csa-annual-activities-report-on-the-oversight-of-the-self-regulatory-organizations-sros-and-investor-protection-funds-ipfs/) **Published:** May 25, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published CSA Staff Notice 25-303 2021 CSA Annual Activities Report on the Oversight of the Self-Regulatory Organizations (SROs) and Investor Protection Funds (IPFs) (The Report). The Report summarizes CSA oversight of the SROs and IPFs during the 2021 calendar... **Content:** The Canadian Securities Administrators (CSA) have published CSA Staff Notice 25-303 *2021 CSA Annual Activities Report on the Oversight of the Self-Regulatory Organizations* (SROs) *and Investor Protection Funds* (IPFs) (The Report). The Report summarizes CSA oversight of the SROs and IPFs during the 2021 calendar year. The SROs are the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA), and the IPFs are the Canadian Investor Protection Fund and the MFDA Investor Protection Corporation. Key highlights in The Report include information on: - **The creation of a new SRO framework**. The CSA continues to make progress towards the creation of a new, single enhanced SRO that will consolidate the functions of the existing SROs. This also includes the creation of a new IPF, which will combine the existing IPFs into an integrated fund independent of the new SRO. Work is on track towards the closing date of December 31, 2022. - **The modernization and streamlining of orders and Memorandums of Understanding (MOUs)**. The CSA completed the final phase of a three-phase, multi-year project that is intended to improve harmonization and CSA oversight of the SROs and IPFs, and enhance investor protection. The first phase focused on modernizing reporting requirements for the SROs, the second sought to eliminate regulatory gaps related to IPF approvals and oversight, and the final phase concentrated on streamlining and modernizing orders and MOUs. Notably, harmonization of the orders and MOUs will also ease work related to the creation of the new SRO framework. - **The enhanced methodology project**. The CSA completed work to identify and implement improvements to its methodology for coordinated oversight of the SROs and IPFs and formalize a number of practices and processes already followed by SRO staff. Key changes include: (1) incorporating best practices into the CSA’s risk assessment framework for the SROs and IPFs; (2) introducing definitions for different levels of participation that define a jurisdiction’s involvement in an oversight activity; (3) establishing the concept of “regulatory activities” which are core to SRO or IPF mandates and recommending those activities be examined at least once every five years; (4) outlining the process which recognizing regulators will follow to handle complaints made against an SRO or IPF; (5) and defining an enforcement referrals process for the SROs. The methodology was implemented on April 1, 2021. - **Oversight reviews**. Details of oversight reviews conducted by the CSA during the reporting period include information on the outcomes of a risk-based desk review of IIROC’s Equity Market Surveillance and Debt Market Surveillance functions and annual risk assessments of IIROC, the MFDA, the Canadian Investor Protection Fund and the MFDA Investor Protection Corporation. CSA Staff Notice 25-303 *2021 CSA Annual Activities Report on the* *Oversight of Self-Regulatory Organizations and Investor Protection Funds* can be found on CSA member [websites](https://www.osc.ca/en/securities-law/instruments-rules-policies/2/25-303/csa-staff-notice-25-303-2021-csa-annual-activities-report-oversight-self-regulatory-organizations). 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. **Categories:** News & Updates, Securities enforcement lawyer --- ### [Canadian Securities Administrators Publish 2021-2022 Enforcement Report](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-2021-2022-enforcement-report/) **Published:** July 4, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) today released its fiscal year 2021-2022 Enforcement Report (the Enforcement Report), which outlines the specific actions that CSA members undertook in the past year to detect, disrupt and deter wrongdoing and hold securities law violators accountable.   Highlights from the fiscal... **Content:** The Canadian Securities Administrators (CSA) today released its fiscal year 2021-2022 Enforcement Report (the Enforcement Report), which outlines the specific actions that CSA members undertook in the past year to detect, disrupt and deter wrongdoing and hold securities law violators accountable. Highlights from the fiscal year’s Enforcement Report include: - 236 Investor Alerts warned the public about potentially harmful or illegal activity; - 61 interim cease-trade and asset-freeze orders issued; - 59 matters commenced involving 139 respondents; - 14 crypto-related matters where the CSA took action in pursuit of clarifying and enhancing regulation; - 44 individuals and 13 companies were banned from participating in the capital markets; and, - 7 individuals received a combined total of 15.4 years of jail terms for criminal and quasi-criminal cases. The 2021-2022 Enforcement Report is available for download from [CSA’s website](https://www.securities-administrators.ca/enforcement/activity-reports/). 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. **Categories:** News & Updates, Securities enforcement lawyer --- ### [Canadian Securities Administrators’ Year in Review Highlights Crypto Regulatory Developments and Enforcement Actions](https://baxsecuritieslaw.com/canadian-securities-administrators-year-in-review-highlights-crypto-regulatory-developments-and-enforcement-actions/) **Published:** August 5, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) recently published their 2023-2024 Year in Review (The Year in Review), which discussed the emerging cryptocurrency regulatory regime and enforcement actions the regulator undertook in crypto-related matters. Perhaps as a sign of the times, in 2023-2024, over half of the... **Content:** The Canadian Securities Administrators (CSA) recently published their *2023-2024 Year in Review* (The Year in Review), which discussed the emerging cryptocurrency regulatory regime and enforcement actions the regulator undertook in crypto-related matters. Perhaps as a sign of the times, in 2023-2024, over half of the 1,054 warnings the CSA issued to the public were directly related to crypto matters, while the regulator carried out 15 separate enforcement actions against crypto miscreants. “Digital assets continue to grow in popularity,” CSA staff noted, “which presents a challenge requiring cooperation and collaboration with other regulators.” Against this backdrop, the regulator discussed the regulatory environment for crypto in Canada, which included working with other regulators to examine and reduce potential supervisory gaps and mitigate risks to the capital markets. During this time, the CSA: - Published guidance to help fund managers understand and comply with securities law requirements. - Published for comment a set of proposed regulatory requirements for investment funds; this was the second phase of a project aimed at implementing a Canadian regulatory framework for public investment funds holding crypto assets. - Provided further regulatory clarity and guidance to crypto trading platforms (CTPs) about the CSA’s interim approach to the trading of stablecoins. - Developed informational resources to support investors’ understanding of crypto assets and the risks they pose as an investment. - Collaborated internationally and lent its expertise to publications that help set the tone for the development of policy recommendations for crypto and digital assets. *The 2023-2024 Year in Review* [ is available for download](https://www.securities-administrators.ca/year-in-review/) from the website of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Crypto lawyer, News & Updates, Securities enforcement lawyer --- ### [CSA’s 2024-2025 Year in Review Highlights Increased Crypto Enforcement Actions](https://baxsecuritieslaw.com/csas-2024-2025-year-in-review-highlights-increased-crypto-enforcement-actions/) **Published:** August 19, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) recently published their *2024 – 2025 Year in Review* (The Year in Review), highlighting the regulator’s activities during the past year, including the issuing of over one thousand investor alerts, with the majority of those relating to crypto assets. The regulator also reported that it carried out enforcement actions in 20 crypto-related matters, representing a 33.3% increase from the 15 crypto-related enforcement actions it carried out in the previous year. Other CSA activities noted in the report include: - Banning permanently 54 companies and individuals from participating in the capital markets following enforcement proceedings; - Issuing 57 publications about final adoption of rule changes, consultations, blanket orders and guidance on CSA policy developments; - Reaching over 4.5 million Canadians through its “Check Registration” and “Spot the Red Flags of Fraud” investor education campaigns; and, - Hosting representatives of 155 organizations at the CSA Collaboratory’s inaugural webinar on Data Portability. *The 2024-2025 Year in Review* [ is available for download](https://www.securities-administrators.ca/year-in-review/) from the website of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Crypto lawyer, News & Updates, Securities enforcement lawyer --- ### [Canadian Securities Regulators Provide Guidance for Social Media Influencers and Content Creators](https://baxsecuritieslaw.com/canadian-securities-regulators-provide-guidance-for-social-media-influencers-and-content-creators/) **Published:** December 24, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) and Canadian Investment Regulatory Organization (CIRO) (the regulators) have released *Joint Canadian Securities Administrators and Canadian Investment Regulatory Organization Staff Notice 31-369 Guidance on the Application of Securities Legislation to Finfluencer Activity* (the Staff Notice*)* which provides guidance for social media financial content creators and influencers (finfluencers). As social media is increasingly a source of financial information for Canadians, with content creators playing a role in shaping these conversations, the regulators note that activities of some content creators and influencers can introduce new risks to investors. The goal of the Staff Notice is to help social media content creators and influencers, and the firms they work with understand and follow securities laws when posting information about investing online. The guidance in the Staff Notice offers concrete examples of how both registrants and content creators can understand and be compliant with the requirements set out by securities regulators. The CSA and CIRO expect content creators and influencers, as well as the registrants and issuers who work with them, to become familiar with and follow the rules set out in the guidance. The regulators warn that breaking securities laws can lead to serious penalties and other enforcement actions. *Joint Canadian Securities Administrators and Canadian Investment Regulatory Organization Staff Notice 31-369 Guidance on the Application of Securities Legislation to Finfluencer Activity* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/3/31-369/joint-canadian-securities-administrators-and-canadian-investment-regulatory-organization-staff#msdynmkt_trackingcontext=c5c4e23b-d109-441d-b830-cb6aabe50200&msdynmkt_prefill=mktprf21371990be7640bfa182f5bf5b177a4deoprf) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates, Securities enforcement lawyer --- ### [OSC Sets out Expectations for Peer-to-Peer Lending Websites June 19, 2015](https://baxsecuritieslaw.com/2015123osc-sets-out-expectations-for-peer-to-peer-lending-websites-june-19-2015/) **Published:** December 3, 2015 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (“OSC”) has published a notice to businesses which are seeking to enter the peer-to-peer lending space in Canada. According to the OSC, depending on the structure, underlying facts and circumstances, a loan arrangement entered into on a peer-to-peer lending website may... **Content:** The Ontario Securities Commission (“OSC”) has published a notice to businesses which are seeking to enter the peer-to-peer lending space in Canada. According to the OSC, depending on the structure, underlying facts and circumstances, a loan arrangement entered into on a peer-to-peer lending website may constitute a “security” as defined under the Ontario Securities Act. If the peer-to-peer businesses is trading securities it will be required to file a prospectus or rely on an exemption from the prospectus requirement and may be required to be registered as a dealer or advisor. Peer-to–peer lending websites which facilitate the matching of borrowers and lenders, may also be considered to trading in “securities” in other Canadian jurisdictions and may be subject to other Canadian laws applicable to financial institutions. If you plan to operate a peer-to-peer lending website in Ontario or in any other Canadian jurisdiction you will legal advice to determine if you are trading in “securities” (evidence of indebtedness or investment contract) and whether you require registration as an exempt market dealer, restricted dealer or adviser. If you are contemplating a peer-to-peer lending system in Canada, please call our founder Barbara Hendrickson at 647 403 4606 to discuss whether you need to be registered or require other discretionary relief to carry on your business. Barbara has extensive experience in this area having obtained exemption relief for the first peer-to-peer lending portal to obtain exemptive relief to operate in Canada. **Categories:** News & Updates, P2P peer to peer lending --- ### [Canadian Securities Regulation of Online Lending Platforms](https://baxsecuritieslaw.com/2016117canadian-securities-regulation-of-online-lending-platforms/) **Published:** November 7, 2016 **Author:** Barbara Hendrickson **Excerpt:** BackgroundOn October 24, 2016, the Ontario Securities Commission (“OSC”) announced its new innovation hub “Launchpad” for market participants in the fintech area to “help companies navigate” and possibly “tailor” the securities regulatory framework. The OSC Launchpad, which is said to be a first for Canadian... **Content:** **Background** On October 24, 2016, the Ontario Securities Commission (“OSC”) announced its new innovation hub “Launchpad” for market participants in the fintech area to “help companies navigate” and possibly “tailor” the securities regulatory framework. The OSC Launchpad, which is said to be a first for Canadian securities regulators, follows on the introduction of similar models in the UK and Australia, is designed to “accelerate time-to-market”. On October 24, 2016, the OSC also approved the registration of an AngelList subsidiary as a restricted dealer to operate its online networking and capital raising platform for angel investors and start ups. [http://www.osc.gov.on.ca/en/SecuritiesLaw\_ord\_20161024\_angellist.htm](http://www.osc.gov.on.ca/en/SecuritiesLaw_ord_20161024_angellist.htm) In addition, on October 24, 2016 the OSC approved the registration as of a Lending Loop subsidiary an exempt market dealer to operate its online lending platform. This follows on the registration by the OSC in September of this year of a Lendified subsidiary, Vault Circle Inc., as an exempt market dealer to operate an online lending platform. The registration of all three fintech platforms follows a seven year haitus in the registration of peer to peer lending platforms in Canada. The last and first registration of a P2P firm in Canada was CommunityLend Inc. which was registered by the OSC in 2009. During the seven year period between CommunityLend’s approval and the latest spat of registrations, a number of unregistered peer to peer firms initially attempted to start up shop in Canada, but later shut down their operations when faced with complying with securities requirements. In 2015, in light of heightened activity and interest in this area, the OSC published its news release that warned warned this market that their activities may trigger dealer registration and prospectus requirements under Ontario Securities laws. [http://www.osc.gov.on.ca/en/NewsEvents\_nr\_20150619\_peer-to-peer-lending.htm](http://www.osc.gov.on.ca/en/NewsEvents_nr_20150619_peer-to-peer-lending.htm) OSC Staff Notice 33-747 Annual Summary Report for Dealers, Advisers and Investment Fund Managers – Compliance and Registrant Regulation further cautions the peer to peer lending market to consider their securities regulatory obligations before operating a P2P or lending platform (July 21, 2016). [http://www.osc.gov.on.ca/en/SecuritiesLaw\_20160721\_sn\_33-747\_annual-rpt-dealers-advisers.htm](http://www.osc.gov.on.ca/en/SecuritiesLaw_20160721_sn_33-747_annual-rpt-dealers-advisers.htm) CommunityLend The decision document for CommunityLend which was issued by the OSC on September 8, 2016 (“CommunityLend Order”) is long and complex. Many of the prescribed conditions in the CommunityLend Order have been adopted in the AngelList, Vault Circle and Lending Loop online platforms. CommunityLend’s peer to peer model was extremely innovative when it was introduced. [http://www.osc.gov.on.ca/en/SecuritiesLaw\_ord\_20090911\_215\_communitylend.jsp](http://www.osc.gov.on.ca/en/SecuritiesLaw_ord_20090911_215_communitylend.jsp) CommunityLend Inc. was registered as a limited market dealer (the precursor of the exempt market dealer category) and as a restricted portfolio manager by the OSC, the British Columbia Securities Commission and the Autorite des marches financiers. Like AngleList and Vault Circle, CommuniytLend was only open to investors / lenders who were accredited investors. Its online bidding process allowed issuers / borrowers to syndicate short term consumer loans up to $25,000 to multiple investors/ lenders. Certain of the provisions of the CommunityLend Order reflect the fact that it was issued before the current NI 31-103 regime came into force. However, the majority of the provisions prescribe in detail how CommunityLend was required to operate its online peer to peer lending platform covering, among other things, the contents and structure of its website; the terms of agreements with borrowers and lenders; registration process for both lenders and borrowers; identity verification; terms of the loans; the loan request process; acceptable investment limits; certification of accredited investors; the loan default process; contents of disclosure; acceptable fees; advertising and related party considerations. CommunityLend ceased operating its peer to peer lending platform in 2012 when its principals went in another direction – “Financeit” a cloud based point-of-sale financing platform. **Lendified / Vault Circle Inc.** The loans offered on the Vault Circle lending platform include “high yield Canadian small business loans from creditworthy businesses.” The Vault Circle registration as an exempt market dealer, which is not time limited, is subject to the following conditions. Vault Circle must: - operate an online lending platform only in Ontario and only in reliance only on the accredited investor exemption; and - have reasonable access to an issuer (borrower) books and records that it approves for the distribution on the lending platform. **Lending Loop/ Loop Securities Inc.** Loop Securities Inc., which is registered as an exempt market dealer in all Canadian jurisdictions, has a two-year time limited registration. Loop Securities is registered to distribute “payment dependent notes” (“Notes”) issued by an affiliate of Loop Securities Inc. – Loop Funding Inc. relying on the offering memorandum exemption. Loop Securities has a number of additional conditions on its registration due to the “novel” nature of it offering. Loop Securities must: - maintain reasonable access to the books and records of any issuer on the platform; - report the following information to the OSC on a quarterly basis: the amounts of the Notes that were successfully funded, the Notes that were removed from the platform because they were not funded; any amendments to the Notes; any defaults on the Notes or amendments to payment schedules; - provide the OSC with 30 days advance notice of material changes to the credit assessment or underwriting process of Loop Funding Inc.; - report the following to the OSC on a quarterly basis: investment transactions by investors; types of investors approved for access to the platform and the details of investor complaints. **AngelList / AngelList LLC and AngelList Advisors LLC** AngelList was registered to operate in Ontario an online platform that offers a number of services to start up businesses primarily in the technology sector including services to facilitate venture capital and angel investing. The OSC approved a start up funding platform for AngelList LLC (“AngelList LLC”) and AngelList Advisors, LLC (“ALA”) on October 24, 2016 on the basis of a two-year test period in light of the “novel” nature of their business. ALA was registered as a restricted dealer in Ontario to facilitate the syndication of offerings through the platform. AngelList LLC is responsible for operating the online platform. All investors on the AngelList platform must be accredited investors.The decision issued by the OSC on October 24, 2016 (“AngelList Order”) provides relief from certain registrant obligations in NI 31-103 and the prospectus requirements of the Ontario Securities Act. AngelList has the most extensive conditions attached to its registration. The AngelList Order is reminiscent of the CommunityLend Order in that it sets out a detailed set of conditions respecting the operation of the funding platform and the process that AngelList must undertake with investors. These provisions include detailed descriptions of each of the service areas to be delivered on the platform and how the platform will operate generally. Allowable services include “Public Services”; “Connection Services”; “Recruiting Services”; “Restricted Services”; “Syndicate Services”; a Professional Investor Program and an Approved Incubator Programs that include University of Toronto Rotman School of Management’s Creative Destruction Lab and NEXT Canada. The AngelList Order also contains several conditions respecting how accredited investors can participate on the platform (for example, “Lead Investors”, “Permitted Clients”, “Ontario Quality Investors” and “Credible Investors”); information that must be retained with respect to accredited investors; disclosure that must be given to accredited investors (for example, prescribed risk disclosure); the process for verifying accreditor investor status; the role of “Lead Investors”; specific suitability criteria for accredited investors (for example, previous venture capital experience); identify verification and the use of algorithm scores to rate investors. The AngelList Order also contains several conditions for types of issuers that call sell securities on the platform (for example, “Eligible Canadian Startups”, “Venture Capital Funds”, “Private Syndicates” and “SPEs”). The AngelList Order, CommunityLend Order and the conditions of registration imposed of all of these fintech firms provide insight into how fintech companies in the online lending space will be required to operate in Canada in the future. Barbara Hendrickson has extensive experience providing corporate finance, securities and financial services advice to the fintech industry. Her clients have operated in the following areas: online lending marketplaces including peer to peer lending platforms, real estate based lending, equity crowdfunding, trading signal providers, robo-advisors, online mortgage syndication, financial services software providers, artificial intelligence and robotics providers, online commodity traders, online foreign exchange traders, regulatory compliance software, exempt market dealers with online trading systems, mobile apps in a number of areas and trading and clearing and settlement systems. **If you would like more information, please call Barbara Hendrickson at 416.601.1004.** **Categories:** News & Updates, P2P peer to peer lending --- ### [Ontario Capital Markets Modernization Taskforce Recommends Changes To Allow For Greater Access To Capital For Start-Ups And Entrepreneurs](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-changes-to-allow-for-greater-access-to-capital-for-start-ups-and-entrepreneurs/) **Published:** February 9, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas improving regulatory structure to enhance governance; improving competitiveness through regulatory measures; ensuring a level playing field between large and small market players; improving the proxy system, corporate governance and the process of mergers and acquisitions; fostering innovation; and modernizing enforcement and enhancing investor protection. Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #33 – Allow for greater access to capital for start-ups and entrepreneurs** The Taskforce’s view is that the COVID-19 pandemic has reiterated the importance of capital formation for start-ups and entrepreneurs in ensuring a sustainable economy. The Taskforce refers to angel investor “groups” or “networks” that attract quality earlier-stage issuers for investment consideration, professionalize and share due diligence, share domain knowledge and expertise in particular industries and assist in reducing the cost of capital of a transaction. The Taskforce recommends that the Ontario Securities Commission modernize its rules so that this early-stage financing of start-ups can be undertaken by angel groups to assist with capital formation including changes to the current registration requirements to enable angel groups to work with their “accredited investor” members to encourage investments in early stage issuers. The Taskforce questions whether this should this apply to not-for-profit angel groups and whether this should be facilitated through regulatory relief (exemption), or exemptive relief or through a form of no-action letter. The Report also queries whether peer to peer (P2P) lending frameworks be leveraged to support capital raising of such early stage start-up businesses. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Mergers and acquisitions lawyer, News & Updates, P2P peer to peer lending --- ### [OSC Publishes OSC Staff Notice 52-724 Considerations for Public Accounting Firms in Developing Internal Ethics Policies and Procedures](https://baxsecuritieslaw.com/osc-publishes-osc-staff-notice-52-724-considerations-for-public-accounting-firms-in-developing-internal-ethics-policies-and-procedures/) **Published:** July 10, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has published a report aimed at guiding public accounting firms to develop and implement robust internal ethical policies and procedures (OSC Staff Notice 52-724, Considerations for Public Accounting Firms in Developing Internal Ethics Policies and Procedures, the Staff Notice). The... **Content:** The Ontario Securities Commission (OSC) has published a report aimed at guiding public accounting firms to develop and implement robust internal ethical policies and procedures (*OSC Staff Notice 52-724, Considerations for Public Accounting Firms in Developing Internal Ethics Policies and Procedures*, the Staff Notice). The publication of the Staff Notice follows a series of targeted inquiries made by the regulator to certain public accounting firms that conduct audits of Ontario reporting issuers. The Staff Notice summarizes the scope of these inquiries and communicates observations about the internal policies, practices, and procedures in place at these firms. The Staff Notice identifies select areas of focus public accounting firms should consider as part of their ethics strategies, such as clearly identifying leaders within the firm with ‘ownership’ of the ethics policies, targeted ethics education training and guidance, and establishing a robust internal whistleblower program. It also provides considerations to help firms comply with requirements related to the dating of audit working papers and internal professional training programs. *OSC Staff Notice 52-724, Considerations for Public Accounting Firms in Developing Internal Ethics Policies and Procedures* is available for download from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates, OSC --- ### [OSC Adopts Permanent Exemptions for Federal Financial Institutions](https://baxsecuritieslaw.com/osc-adopts-permanent-exemptions-for-federal-financial-institutions/) **Published:** October 10, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) announced today the adoption of OSC Rule 52-503, Exemption from Disclosure of a Specified Financial Measure (The Rule).   This action is intended to make permanent a temporary exemption issued on December 2, 2021, which expired on June 2, 2023. The... **Content:** The Ontario Securities Commission (OSC) announced today the adoption of **OSC Rule 52-503,** *Exemption from Disclosure of a Specified Financial Measure* (The Rule). This action is intended to make permanent a temporary exemption issued on December 2, 2021, which expired on June 2, 2023. The Rule provides an exemption in Ontario from certain requirements in National Instrument 52-112 *Non-GAAP and Other Financial Measures Disclosure*, for a reporting issuer that is, or that has a subsidiary or an affiliate that is, a “federal financial institution” as defined by the Bank Act (Canada) and subject to the guidelines of the Office of the Superintendent of Financial Institutions. *OSC Rule 52-503**,*** *Exemption from Disclosure of a Specified Financial Measure,* [is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/5/52-503) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates, OSC --- ### [OSC Releases Report on Artificial Intelligence in Ontario’s Capital Markets](https://baxsecuritieslaw.com/osc-releases-report-on-artificial-intelligence-in-ontarios-capital-markets/) **Published:** October 12, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has published a report, Artificial Intelligence in Capital Markets: Exploring the Use Cases in Ontario (the Report), exploring the use of artificial intelligence (AI) in Ontario’s capital markets. The Report highlights current AI use cases, benefits, and challenges. The Report's goal is to... **Content:** The Ontario Securities Commission (OSC) has published a report, *Artificial Intelligence in Capital Markets: Exploring the Use Cases in Ontario* (the Report)**,** exploring the use of artificial intelligence (AI) in Ontario’s capital markets. The Report highlights current AI use cases, benefits, and challenges. The Report’s goal is to raise awareness of both the opportunities and risks associated with AI usage in the capital markets. Key take-aways include: - Capital market participants are using AI to enhance their existing products and services, rather than creating new ones. - AI is at an intermediate stage of adoption in Ontario’s capital markets. The key value drivers of AI adoption in capital markets include: - Enhanced capacity to extract information and insights from enormous volumes of structured and unstructured data; - Greater automation of manual processes that involve handling and managing data; - More precise predictive analytics; - Better liquidity forecasting and hedging; and, - Increased end-user satisfaction through more personalized service. The Report also found that most developed use of AI in Ontario’s capital markets is focused on three principal areas: improving the efficiency and accuracy of operational processes; trade surveillance and detection of market manipulation; and supporting advisory and customer service. However, use of AI in areas such as asset allocation and risk management, is not as well-developed. Larger firms appear to be developing in-house AI solutions and using the technology in areas with greater financial risk more so than smaller firms, indicating that scale is important for the development of AI models, the Report notes. While capital market participants continue to employ and explore a range of AI technologies, natural language processing is the most common choice. Major challenges remain for AI adoption, including data constraints, accessing skilled labour, corporate culture, and governance. The complete Report, *Artificial Intelligence in Capital Markets: Exploring the Use Cases in Ontario*, [is available for download](https://oscinnovation.ca/modernization/artificial-intelligence) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Capital markets lawyer, News & Updates, OSC --- ### [OSC Publishes Notice and Request for Comment: Proposed Amendments to OSC Rule 13-502 Fees and OSC Rule 13-503 (Commodity Futures Act) Fees](https://baxsecuritieslaw.com/osc-publishes-notice-and-request-for-comment-proposed-amendments-to-osc-rule-13-502-fees-and-osc-rule-13-503-commodity-futures-act-fees/) **Published:** November 23, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) is publishing for a 90-day comment period ending February 7, 2024, proposed amendments (Proposed 13-502 Amendments) to OSC Rule 13-502 Fees (the Fee Rule), published in Annex A; and proposed amendments (the Proposed 13-503 Amendments) to OSC Rule 13-503 (Commodity Futures Act) Fees (CFA... **Content:** The Ontario Securities Commission (OSC) is publishing for a 90-day comment period ending February 7, 2024, proposed amendments (Proposed 13-502 Amendments) to OSC Rule 13-502 *Fees* (the Fee Rule), published in Annex A; and proposed amendments (the Proposed 13-503 Amendments) to OSC Rule 13-503 (*Commodity Futures Act*) *Fees* (CFA Fee Rule), published in Annex A.1. (collectively, the Proposed Amendments). The Proposed Amendments, if approved, would introduce two new fees (the Proposed Fees) for restricted dealers: an additional fee of $24,500 at the time of OSC registration; and an additional exemptive relief application fee of $24,500 for restricted dealers operating as a marketplace. The Proposed Fees are meant to cover the higher onboarding costs related to the registration of restricted dealers, which include the majority of crypto asset trading platforms, compared to most existing market participants. The Proposed Amendments also include a change to the definition of “registrant firm” in each of the Fee Rule and the CFA Fee Rule that will extend the application of the participation fee and late fee requirements. Under the Fee Rule, unregistered persons or companies will be required to be registered as dealers, advisers, or investment fund managers, under the *Securities Act* (Ontario) (OSA). Under the CFA Fee Rule, unregistered persons or companies are required to be registered as dealers or advisers, under the *Commodity Futures Act* (CFA). Stakeholders are invited to provide comments in writing by February 7, 2024. If approved, the Proposed Amendments are expected to become effective on July 2, 2024. The Proposed Amendments [are available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/1/13-502/osc-notice-and-request-comment-proposed-amendments-osc-rule-13-502-fees-and-osc-rule-13-503) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates, OSC --- ### [OSC Publishes Final Fee Changes For Restricted Dealers](https://baxsecuritieslaw.com/osc-publishes-final-fee-changes-for-restricted-dealers/) **Published:** April 23, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has announced the publication of the final amendments to its fee rules for restricted dealers, for firms permitted to carry on business under terms and conditions imposed by the OSC, Amendments to OSC Rule 13-502 Fees, OSC Rule 13-503 (Commodity... **Content:** The Ontario Securities Commission (OSC) has announced the publication of the final amendments to its fee rules for restricted dealers, for firms permitted to carry on business under terms and conditions imposed by the OSC, *Amendments to OSC Rule 13-502 Fees, OSC Rule 13-503 (Commodity Futures Act) Fees, Changes to their Companion Policies and Related Consequential Amendments and Changes,* (the final amendments). The final amendments will come into force on July 2, 2024, pending Ministerial approval. The OSC published the amendments as proposals for public comment on November 10, 2023. The final amendments introduce two new fees for restricted dealers: - an additional fee of $24,500 at the time of OSC registration; and, - an additional exemptive relief application fee of $24,500 for restricted dealers operating as a marketplace. The new fees are intended to address and recover additional regulatory costs associated with registering restricted dealers, which include crypto asset trading platforms. OSC staff note they continue to observe higher onboarding costs for this registrant category when compared to most existing market participants. The final amendments also include changes to the definition of “registered firm” in its fee rules to include individuals or companies required to be registered under Ontario securities law. These changes, if approved, would mean that a non-compliant, unregistered firm operating in Ontario is responsible for paying the same participation fees as a registered firm. *Amendments to OSC Rule 13-502 Fees, OSC Rule 13-503 (Commodity Futures Act) Fees, Changes to their Companion Policies and Related Consequential Amendments and Changes,* [is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/1/13-502/amendments-osc-rule-13-502-fees-osc-rule-13-503-commodity-futures-act-fees-changes-their-7) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates, OSC --- ### [OSC Announces Initiatives To Enhance Access To Capital For Early-Stage Businesses In Ontario](https://baxsecuritieslaw.com/osc-announces-initiatives-to-enhance-access-to-capital-for-early-stage-businesses-in-ontario/) **Published:** May 16, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has published Notice of General Orders – Ontario Instrument 32-508 Not-For-Profit Angel Investor Group Registration Exemption (Interim Class Order); Ontario Instrument 32-509 Early-Stage Business Registration Exemption (Interim Class Order); Ontario Instrument 45-509 Report of Distributions under the Self Certified Investor... **Content:** The Ontario Securities Commission (OSC) has published *Notice of General Orders – Ontario Instrument 32-508 Not-For-Profit Angel Investor Group Registration Exemption (Interim Class Order); Ontario Instrument 32-509 Early-Stage Business Registration Exemption (Interim Class Order); Ontario Instrument 45-509 Report of Distributions under the Self Certified Investor Prospectus Exemption (Interim Class Order)*, (collectively, the Notice of General Orders). The Notice of General Orders are a series of time-limited exemptions issued through the OSC’s TestLab program and are intended to support capital-raising for early- stage businesses (collectively, the Early-Stage Capital Exemptions). The Early-Stage Capital Exemptions which came into effect on May 9, 2024 and remain in effect until October 25, 2024, feature: - a dealer registration exemption for not-for-profit angel investor groups (the Angel Investor Group Registration Exemption); - a dealer registration exemption for eligible early-stage businesses (the Early-Stage Business Registration Exemption); and - an exemption from the distribution reporting requirement in the Self-Certified Investor Prospectus Exemption Class Order to permit alternative streamlined reporting of distributions (the Self-Certified Investor Reporting Exemption). *The Notice of General Orders* i[s available for download](https://www.osc.ca/sites/default/files/2024-05/sn_20240509_32-508_general-orders_0.pdf) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates, OSC --- ### [Ontario Securities Commission publishes Insights on the OSC Staff’s Approach to Sustainable Finance](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-insights-on-the-osc-staffs-approach-to-sustainable-finance/) **Published:** November 21, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) recently published Insights on the OSC Staff’s Approach to Sustainable Finance (the SF Insights), which builds on the work the regulator has done around sustainable finance and sets its approach for the coming years. The approach is shaped by the... **Content:** The Ontario Securities Commission (OSC) recently published *Insights on the OSC Staff’s Approach to Sustainable Finance* (the SF Insights), which builds on the work the regulator has done around sustainable finance and sets its approach for the coming years. The approach is shaped by the regulator’s recently announced strategic plan and takes a “climate-first” approach. Publication of the SF Insights furthers the OSC’s core objective of building transparency and trust in the sustainable finance ecosystem as the regulator aims to support investors and the regulated community in adapting to both emerging opportunities and risks in this area. It also emphasizes that the regulator will take a holistic approach to sustainable finance to address the needs of our stakeholders. The SF Insights also reflect the ESG (environmental, social, and governance) – related risks market participants increasingly face. The SF Insights sets out three pillars: - Protecting investors and contributing to thriving capital markets through effective and timely regulation, compliance oversight and education. - Demonstrating thought leadership and seeking to be an influential and trusted voice in sustainable finance regulation. - Anticipating what’s next in the rapidly evolving area of sustainable finance. *Insights on the OSC Staff’s Approach to Sustainable Finance* [ is available for download](https://www.osc.ca/sites/default/files/2024-10/20241007_pub_insights-osc-staff-approach-sustainable-finance.pdf) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates, OSC --- ### [OSC Publishes Compliance Review Findings And Guidance For Crypto Asset Trading Platforms](https://baxsecuritieslaw.com/osc-publishes-compliance-review-findings-and-guidance-for-crypto-asset-trading-platforms/) **Published:** December 12, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) recently published its findings from a focused compliance review of crypto asset trading platforms (CTPs). OSC Staff Notice 33-757 Review of Restricted Dealer Crypto Asset Trading Platforms’ Compliance with the Account Appropriateness, Investment Limits and Client Limits Requirements (the Staff... **Content:** The Ontario Securities Commission (OSC) recently published its findings from a focused compliance review of crypto asset trading platforms (CTPs). *OSC Staff Notice 33-757 Review of Restricted Dealer Crypto Asset Trading Platforms’ Compliance with the Account Appropriateness, Investment Limits and Client Limits Requirements* (the Staff Notice) summarizes the OSC’s findings from the review and provides guidance to help CTPs in meeting their regulatory obligations. The review found firms had inadequately assessed initial and ongoing account appropriateness, including instances where a CTP took a mechanical ‘tick box’ approach without following up with clients on any inconsistencies. This led to inappropriate client accounts being opened and maintained. OSC Staff also found instances where CTPs did not set meaningful client limits (loss limits) tailored to their specific needs. However, the review found CTPs were keeping in line with their regulatory obligations around limiting the client’s purchase of crypto assets. During the review, OSC Staff looked at six Ontario-based, registered CTPs to assess their compliance with the terms and conditions of their registration. Following the completion of the review and identification of issues, OSC staff have engaged with firms to resolve the regulator’s concerns. The Staff Notice is intended to provide additional clarity on expectations for compliance with the conditions surrounding account appropriateness, investment limits and client limits. In the regulator’s view, while the Staff Notice held some positive findings, it also spelt out the need for continued guidance. The regulator advises CTPs to review and assess their practices against the guidance contained in the Staff Notice. OSC Staff will continue to monitor CTPs’ compliance with the conditions alongside other fundamental registrant obligations in securities legislation. *OSC Staff Notice 33-757 Review of Restricted Dealer Crypto Asset Trading Platforms’ Compliance with the Account Appropriateness, Investment Limits and Client Limits Requirements* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/3/33-757/osc-staff-notice-33-757-review-restricted-dealer-crypto-asset-trading-platforms-compliance-account) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Crypto lawyer, News & Updates, OSC --- ### [OSC Approves CIRO’s Integrated Fee Model](https://baxsecuritieslaw.com/osc-approves-ciros-integrated-fee-model/) **Published:** February 24, 2025 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has approved CIRO’s proposed integrated fee model (Fee Model) and related amendments to the Mutual Fund Dealer Rules (Amendments). The Fee Model includes changes to the: Annual Dealer Member fee; Membership application fees and fees for Dealer Member business changes;... **Content:** The Ontario Securities Commission (OSC) has approved CIRO’s proposed integrated fee model (Fee Model) and related amendments to the Mutual Fund Dealer Rules (Amendments). The Fee Model includes changes to the: - Annual Dealer Member fee; - Membership application fees and fees for Dealer Member business changes; and, - Qualified Market Maker Discount within the Equity Market Regulation Fee Model. The Fee Model will become effective April 1, 2025. CIRO published the Fee Model and Amendments for comment on April 25, 2024. Fifteen comment letters were received. Non- material changes made to the Fee Model and the Amendments following the publication for comment were approved by CIRO’s President and Chief Executive Officer and are described in the *CIRO Implementation Bulletin*. OSC staff advise that the Alberta Securities Commission; the Autorité des marchés financiers; the British Columbia Securities Commission; the Financial and Consumer Affairs Authority of Saskatchewan; the Financial and Consumer Services Commission of New Brunswick; the Manitoba Securities Commission; the Northwest Territories Office of the Superintendent of Securities; the Nova Scotia Securities Commission; the Nunavut Office of the Superintendent of Securities; the Office of the Superintendent of Securities, Digital Government and Services, Newfoundland and Labrador; the Office of the Yukon Superintendent of Securities; and the Prince Edward Island Office of the Superintendent of Securities have neither objected to or approved the Fee Model. A summary of the public comments and CIRO’s responses to those comments, as well as the *CIRO Implementation Bulletin,* including the Fee Model and text of the Amendments [are available for download from the website](https://www.osc.ca/sites/default/files/2024-12/ciro_20241205_implementation-bulletin-umir-short-sale.pdf) of the Ontario Securities Commission. *Notice of Commission Approval Integrated Fee Model Canadian Investment Regulatory Organization (CIRO)* [ is available for download](https://www.osc.ca/sites/default/files/2025-01/ciro_20250130_notice-commission-approval.pdf) from the websites of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates, OSC --- ### [Ontario Securities Commission announces 2025-26 examination priorities (OSC Staff Notice 33-758)](https://baxsecuritieslaw.com/ontario-securities-commission-announces-2025-26-examination-priorities-osc-staff-notice-33-758/) **Published:** June 12, 2025 **Author:** Barbara Hendrickson **Content:** The Ontario Securities Commission’s (OSC) Registration, Inspections and Examinations Division (RIE) recently published its 2025-26 Examination Priorities (the Examination Priorities) (OSC Staff Notice 33-758). The RIE is responsible for the ongoing supervision of firms and individuals engaged in the business of trading in, or advising on, securities or commodity futures, as well as firms that manage investment funds in Ontario. They are informed by the six goals of the [OSC’s 2024-2030 Strategic Plan,](https://www.osc.ca/sites/default/files/2024-05/pub_20240503_OSC-strategic-plan.pdf) as well as risk identification from different sources, including consultation with other divisions within the OSC, prior years’ examinations, market events and interactions, and open dialogue with market participants, advisory committees, industry groups and other regulators, both Canadian and international. More specifically, the OSC has included the following areas the focus of their examination initiatives: Artificial Intelligence (AI) – RIE will examine the prevalence of AI within registrants’ operations. RIE will examine how registrants are responding to the Canadian Securities Administrators (CSA) Staff Notice and Consultation 11-348 Applicability of Canadian Securities Laws and the use of Artificial Intelligence Systems in Capital Markets to provide reasonable assurance that the firm and each individual acting on its behalf comply with securities legislation. Cybersecurity – RIE will examine policies and procedures that registrants have in place to protect against and respond to cybersecurity incidents, and protect records, assets and investor information. Financial Institution Sales Practices Examination – In collaboration with CIRO, RIE will continue its examination into high pressure sales practices within Canadian bank branches. The Exempt Market – In collaboration with the OSC’s Corporate Finance Division, RIE will examine exempt market dealers that distribute securities in reliance on the offering memorandum exemption in section 2.9 of National Instrument 45-106 Prospectus Exemptions. The examination will consider the know-your-product practices of registrants when distributing securities of issuers that are in default of their reporting obligations under the offering memorandum exemption. The OSC notes that its examination priorities are not an exhaustive compilation of the initiatives that RIE will focus its attention on. RIE will be proactive in its response to new and emerging risks, evolving products and service offerings, market events and investor concerns, which may impact its 2025 examination priorities. The OSC also advises that RIE will continue to conduct pre-registration examinations of firms seeking to become registered with the OSC. RIE will also review participation fee filings and excess working capital filings to ensure that firms are paying their required fees and are meeting their capital obligations. The 2025-26 Examination Priorities[ are available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/3/33-758/osc-staff-notice-33-758-examination-priorities-registration-inspections-and-examinations-division) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates, OSC --- ### [OSC Adopts New Framework For Distributing Disgorged Funds Collected To Harmed Investors](https://baxsecuritieslaw.com/osc-adopts-new-framework-for-distributing-disgorged-funds-collected-to-harmed-investors/) **Published:** June 18, 2025 **Author:** Barbara Hendrickson **Content:** The Ontario Securities Commission (OSC) has published a new statutory framework that will facilitate distributing amounts collected by the OSC under disgorgement orders to harmed investors (the Final Rules). Briefly, the Final Rules consist of: - OSC Rule 11-502 Distribution of Amounts Received by the OSC under Disgorgement Orders and Payment of Related Administrative Costs; - Companion Policy 11-502 Distribution of Amounts Received by the OSC under Disgorgement Orders and Payment of Related Administrative Costs; - OSC Rule 11-503 (Commodity Futures Act) Distribution of Amounts Received by the OSC under Disgorgement Orders and Payment of Related Administrative Costs; - Companion Policy 11-503 (Commodity Futures Act) Distribution of Amounts Received by the OSC under Disgorgement Orders and Payment of Related Administrative Costs – Modernize the Process to Distribute Disgorged Amounts to Harmed Investors Once the Final Rules come into force, under the new process, the OSC will highlight each disgorgement order on a new section of the OSC website and provide investors with the ability to register their contact information if they would like to be contacted about a potential future distribution of disgorged amounts collected under the order. This new section of the website will also allow investors to stay informed about any amounts collected under the order, and whether the OSC has started a distribution. It will also outline how investors can submit claims. Disgorgement is a type of monetary sanction imposed by the Capital Markets Tribunal or the Ontario Superior Court of Justice. Disgorgement sanctions require the respondent in a proceeding to pay any amounts obtained because of their non-compliance with securities law or commodity futures law. Pending the coming into effect of legislative amendments to the Ontario Securities Act, Commodity Futures Act and Securities Commission Act, 2021, the Final Rules are expected to come into force in late summer or early fall 2025. *The Final Rules [are available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/1/11-502/osc-notice-publication-osc-rule-11-502-distribution-amounts-received-osc-under-disgorgement-orders)* from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates, OSC --- ### [OSC Publishes Draft Action Plan For Truth and Reconciliation](https://baxsecuritieslaw.com/osc-publishes-draft-action-plan-for-truth-and-reconciliation/) **Published:** July 10, 2025 **Author:** Barbara Hendrickson **Content:** The Ontario Securities Commission (OSC) today published its draft Action Plan for Truth and Reconciliation (APTR) for engagement and is seeking feedback for a period ending October 31, 2025, from interested or affected parties, including rightsholders in Ontario, Indigenous organizations, market participants, regulators, investors and investor advocates. The OSC has developed the APTR as part of its vision to ensure that Ontario’s capital markets are inviting, thriving and secure for everyone. The APTR will serve as a roadmap for how the OSC: - can build a culturally aware, safe and more inclusive workforce; and, - work collaboratively with Indigenous peoples and partners and communities to foster a culture of inclusion and investor confidence for the benefit of all. The APTR follows the regulator’s alignment of its commitments and business plans with the Truth and Reconciliation Commission’s Calls to Action 57 and 92. In drafting the AFTR, the OSC has extensively engaged with Indigenous communities and organizations in Ontario, Indigenous-led market participants, and Indigenous and non-Indigenous experts in the capital markets. The draft *Action Plan for Truth and* *Reconciliation* [ is available for download](https://www.osc.ca/en/news-events/reports-and-publications/action-plan-truth-and-reconciliation) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Governments, OSC --- ### [OSC’s Registration, Inspections And Examinations Division Publishes its 2025 Annual Report](https://baxsecuritieslaw.com/oscs-registration-inspections-and-examinations-division-publishes-its-2025-annual-report/) **Published:** July 30, 2025 **Author:** Barbara Hendrickson **Content:** The Ontario Securities Commission (OSC)’s Registration, Inspections and Examinations (RIE) Division has published *OSC Staff Notice 33-759 − Registration, Inspections and Examinations Division − 2025 Annual Report* (the Annual Report). The RIE Division of the OSC is responsible for the registration and ongoing supervision of firms and individuals who are in the business of trading in, or advising on, securities or commodity futures and firms that manage investment funds in Ontario. The RIE Division is also responsible for conducting compliance examinations of certain regulated market participants in Ontario, including the enhanced risk-based oversight of the Canadian Investment Regulatory Organization (CIRO). The Annual Report summarizes the activities of the RIE Division for the fiscal year April 1, 2024 – March 31, 2025. *OSC Staff Notice 33-759 − Registration, Inspections and Examinations Division − 2025 Annual* *Report* [ is available for download](https://www.osc.ca/sites/default/files/2025-07/sn_20250724_33-759_RIE-annual-report-2025.pdf) from the websites of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates, OSC --- ### [BAX Securities Law’s Barbara Hendrickson to speak at the Ontario Bar Association: Twenty Third Annual OSC, TMX, and CIRO Update](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-to-speak-at-the-ontario-bar-association-twenty-third-annual-osc-tmx-and-ciro-update/) **Published:** September 15, 2025 **Author:** Barbara Hendrickson **Content:** Barbara Hendrickson will be a speaker at the Ontario Bar Association’s *Twenty Third Annual OSC, TMX, and CIRO Update* on September 30, 2025. In her presentation, entitled *The Applicability of Canadian securities laws to AI*, Barbara will discuss how artificial intelligence is impacting the securities industry and how regulators are responding to it. More details about *Canadian Bar Association’s Twenty Third Annual OSC, TMX, and CIRO Update*, [can be found on the website of the Canadian Bar Association](https://www.cbapd.org/details_en.aspx?id=on_on25bus07x). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Governments, OSC --- ### [OSC Provides Update On Initiatives To Support Capital-Raising For Early-Stage Businesses](https://baxsecuritieslaw.com/osc-provides-update-on-initiatives-to-support-capital-raising-for-early-stage-businesses/) **Published:** October 2, 2025 **Author:** Barbara Hendrickson **Content:** The Ontario Securities Commission (OSC) recently provided an update on OSC TestLab: Early-Stage Capital Raising (Early-Stage Capital Raising), a set of initiatives to support capital-raising for early-stage Ontario businesses announced in May 2024. OSC TestLab (TestLab) is an OSC testing program for capital market innovations and new approaches to regulation aimed at fostering innovation and competition in Ontario’s capital markets. The feedback received from TestLab participants and stakeholders provided valuable insights that informed an update and extension of the initiatives, including a new OSC blanket order. The feedback received was also considered in launching a consultation by the Canadian Securities Administrators (CSA) regarding its recent proposed harmonized multilateral self-certified investor prospectus exemption. TestLab evaluates capital market innovations and new approaches to regulation in Ontario’s capital markets. Since launching Early-Stage Capital Raising initiative in May 2024, TestLab has consulted with over 500 stakeholders for feedback on various initiatives through surveys, focus groups, roadshows, and one-on-one engagements. This includes early-stage businesses, angel investor groups, exempt market dealers, legal and advisory professionals, and innovation hubs. The OSC has recently updated and extended the [Not-for-Profit Angel order](https://www.osc.ca/en/securities-law/instruments-rules-policies/3/32-510/notice-commission-approval-osc-rule-32-510-extension-ontario-instrument-32-508-not-profit-angel) and [Early-Stage Business Registration exemption](https://www.osc.ca/en/securities-law/instruments-rules-policies/3/32-510/notice-commission-approval-osc-rule-32-510-extension-ontario-instrument-32-508-not-profit-angel), subject to ministerial approval. In addition, the OSC has introduced a [local blanket order providing a Self-Certified Investor Prospectus exemption](https://www.osc.ca/en/securities-law/instruments-rules-policies/4/45-510/notice-general-order-ontario-instrument-45-510-self-certified-investor-prospectus-exemption) effective October 25, 2025. The OSC’s local order is consistent with the harmonized Self-Certified Investor Prospectus Exemption that was recently announced by the CSA. TestLab will continue to collect information to help evaluate the updated initiatives and invite perspectives from the participating businesses and investors and other key stakeholders in the early-stage capital-raising ecosystem. For more information about OSCTestLab and its current initiatives, [click here](https://www.oscinnovation.ca/TestLab). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial, OSC --- ### [OSC Publishes List Of Non-Reporting Exempt Market Issuers](https://baxsecuritieslaw.com/osc-publishes-list-of-non-reporting-exempt-market-issuers/) **Published:** October 23, 2025 **Author:** Barbara Hendrickson **Content:** As part of its drive to for increased transparency and to encourage compliance in the exempt market, the Ontario Securities Commission has published the AFS Non-Delivery List (the AFS List), a list of non-reporting issuers that have relied on the Offering Memorandum exemption (the OM Exemption) in Ontario but have not delivered annual financial statements to the OSC. Delivery of financial statements to the OSC is a condition of the OM exemption. The publication of the AFS List on the OSC website is one part of the regulator’s heightened emphasis on the exempt market, a segment of the capital markets where securities can be sold without the protections associated with a prospectus. Exempt market dealers (EMDs) rely upon the OM Exemption, as detailed in section 2.9 of [National Instrument 45-106 *Prospectus Exemptions*](https://www.osc.ca/en/securities-law/instruments-rules-policies/4/45-106)*.* The regulator’s goal is to increase transparency for retail investors participating in the exempt market and who may be exposed to heightened investment risks, such as the risk of loss, limited liquidity, and lack of information. At the same time, the OSC will continue monitoring EMDs and their use of the OM Exemption to ensure they align with the regulator’s expectations. Additionally, the OSC’s Registration, Inspections and Examinations division (RIE) will examine EMDs involved in the distribution of certain non-reporting issuers that failed to deliver their annual financial statements to the OSC. RIE’s examinations will consider the know-your-product practices of registrants when distributing securities of these issuers. As part of its ongoing work to oversee EMDs, RIE recently identified significant compliance deficiencies that led to the suspension of an EMD and its chief compliance officer. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Business Law, OSC --- ### [OSC Releases Findings On Digital Engagement Practices In Online Investing](https://baxsecuritieslaw.com/osc-releases-findings-on-digital-engagement-practices-in-online-investing/) **Published:** October 24, 2025 **Author:** Barbara Hendrickson **Content:** The Ontario Securities Commission (OSC) has published *OSC Staff Notice 33-760 Digital Engagement Practices: Focused Compliance Examination of Online Retail Platforms* (The Staff Notice). The Staff Notice outlines the regulator’s findings and provides guidance on the use of digital engagement practices (DEPs), including best practices for their responsible application by registrants serving retail clients. OSC staff reviewed firms’ use of DEPs to ensure compliance with existing securities obligations. Staff identified that DEPs are increasingly being used by registrants and found both positive and negatives in how they are deployed. Positive examples of DEPs observed by staff included helping clients track savings goals, delivering educational nudges and alerts to promote account security and encouraging long-term investing behaviour in the clients’ best interests. However, concerns were raised where DEPs were being used to drive further trading activity; and where firms did not maintain adequate policies and procedures. These findings have been shared with the firms in question, noting any required action to be taken. The OSC advises that the results of this initiative will inform the future research it carries out. *(OSC Staff Notice 33-760 Digital Engagement Practices: Focused Compliance Examination of Online Retail Platforms* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/3/33-760/osc-staff-notice-33-760-digital-engagement-practices-focused-compliance-examination-online-retail) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Marketing & Business Development, OSC --- ### [OSC Notice of Amendments to OSC Rule 45-501 Ontario Prospectus and Registration Exemptions relating to Syndicated Mortgages](https://baxsecuritieslaw.com/osc-notice-of-amendments-to-osc-rule-45-501-ontario-prospectus-and-registration-exemptions-relating-to-syndicated-mortgages/) **Published:** December 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** On December 7, 2020 the Ontario Securities Commission (OSC) announced that they are making amendments to OSC Rule 45- 501 Ontario Prospectus and Registration Exemptions (OSC Rule 45-501) relating to syndicated mortgages (the Amendments). The Amendments were originally published for comment on March 15, 2019... **Content:** On December 7, 2020 the Ontario Securities Commission (OSC) announced that they are making amendments to OSC Rule 45- 501 *Ontario Prospectus and Registration Exemptions* (OSC Rule 45-501) relating to syndicated mortgages (the Amendments). The Amendments were originally published for comment on March 15, 2019 (2019 Proposal) and revised proposals were published for a second comment period on August 6, 2020 (2020 Proposal). In the same notice as the 2020 Proposal, the Canadian Securities Administrators (the CSA) published final amendments and changes (CSA Amendments) to: - National Instrument 45-106 *Prospectus Exemptions* and National Instrument 31-103 *Registration Requirements, Exemptions and Ongoing Registrant Obligations*; and - Companion Policy 45-106CP *Prospectus Exemptions* and Companion Policy 31-103CP *Registration Requirements, Exemptions and Ongoing Registrant Obligations*. The purpose of the Amendments and the CSA Amendments is to introduce additional investor protections related to the distribution of syndicated mortgages and to increase harmonization regarding the regulatory framework for syndicated mortgages across all CSA jurisdictions. In Ontario, this will result in the transfer of primary oversight of syndicated mortgages other than qualified syndicated mortgages and syndicated mortgages distributed to permitted clients from the Financial Services Regulatory Authority of Ontario (FSRA) to the OSC. The Amendments, the CSA Amendments and other required materials were delivered to the Minister of Finance on December 7, 2020. If the Minister approves the Amendments, the Amendments and the CSA Amendments will come into force in Ontario on the later of March 1, 2021 and the date that the amendments to the *Securities Act* (Ontario) that repeal subsections 35(4) and 73.2(3) are proclaimed in force. According to the notice, there will be no change from the current regime respect to the exemptions for qualified syndicated mortgages or syndicated mortgages sold to permitted clients as a result of the Amendments. FRSA will continue to exercise primary oversight of the distribution of qualified syndicated mortgages and syndicated mortgage transactions that involve only institutional or high-net-worth investors that fall within the definition of a permitted client. Please see: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20201207\_osc-publishes-final-local-amendments-regarding-syndicated-mortgages.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20201207_osc-publishes-final-local-amendments-regarding-syndicated-mortgages.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** MICs mortgage investment lawyer, News & Updates --- ### [CSA Notice 45-328 - Update on Amendments relating to Syndicated Mortgages](https://baxsecuritieslaw.com/csa-notice-45-328-update-on-amendments-relating-to-syndicated-mortgages/) **Published:** March 15, 2021 **Author:** Barbara Hendrickson **Excerpt:** On February 25, 2021, the Canadian Securities Administrators (CSA), referring to amendments to certain securities rules affecting the prospectus and registration exemptions for syndicated mortgages that were published on August 6, 2020 (Syndicated Mortgage Amendments), reported in a notice that the Syndicated Mortgage Amendments would... **Content:** On February 25, 2021, the Canadian Securities Administrators (CSA), referring to amendments to certain securities rules affecting the prospectus and registration exemptions for syndicated mortgages that were published on August 6, 2020 (Syndicated Mortgage Amendments), reported in a notice that the Syndicated Mortgage Amendments would come into effect on March 1, 2021 in most provinces and territories in Canada. The Syndicated Mortgage Amendments include 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 (the Mortgage Exemptions) respectively for the distribution of syndicated mortgages in Newfoundland and Labrador, the Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island and Yukon; [\[1\]](#_ftn1) - introducing additional requirements to the offering memorandum prospectus exemption under section 2.9 of NI 45-106 (the OM Exemption) that will apply when the exemption is used to distribute syndicated mortgages; and - amending the private issuer prospectus exemption under section 2.4 of NI 45-106 (the Private Issuer Exemption) so that it is not available for the distribution of syndicated mortgages. The Syndicated Mortgage Amendments will take effect in all jurisdictions on March 1, 2021, except in Ontario and Québec. In Ontario, the Syndicated Mortgage Amendments will become effective on the later of: - March 1, 2021; and - the day on which sections 4 and 5 of Schedule 37 to Bill 177, *Stronger, Fairer Ontario Act* (Budget Measures), 2017 are proclaimed into force. The proclamation, and therefore the effective date in Ontario, is expected to be July 1, 2021. In Québec, subject to requisite approvals, the Amendments are expected to take effect on July 1, 2021, at the earliest. A local notice confirming the exact effective date will be published, when determined. For a full copy of the notice: https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-4/45328-CSA-Staff-Notice-February-25-2021.pdf For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. --- [\[1\]](#_ftnref1) Syndicated mortgages are already excluded from the Mortgage Exemptions in Alberta, British Columbia, Manitoba, New Brunswick, Québec and Saskatchewan **Categories:** MICs mortgage investment lawyer, News & Updates --- ### [FINTRAC Issues New AML Requirements for Mortgage Administrators, Brokers, and Lenders](https://baxsecuritieslaw.com/fintrac-issues-new-aml-requirements-for-mortgage-administrators-brokers-and-lenders/) **Published:** November 23, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has issued new Anti-Money Laundering Requirements (AML) for Mortgage Administrators, Brokers, and Lenders. The new AML requirements will become effective on October 11, 2024. As of October 11, 2024, the mortgage industry in Canada will become... **Content:** The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has issued new Anti-Money Laundering Requirements (AML) for Mortgage Administrators, Brokers, and Lenders. The new AML requirements will become effective on October 11, 2024. As of October 11, 2024, the mortgage industry in Canada will become subject to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (the Act). Under the Act, all Mortgage Administrators, Brokers, and Lenders, will be required to: - Implement compliance programs - Report transactions - Keep records - Verify the identity of clients (know your client) - Apply ministerial directives To assure compliance, FINTRAC is authorized to conduct compliance examinations to assess whether reporting entities are meeting the requirements under the Act. It also has legislative authority to issue monetary penalties to those parties it finds to be non-compliant with the Act and its associated regulations. Full details [can be viewed](https://fintrac-canafe.canada.ca/re-ed/mortgage-hypotheque-eng) on FINTRAC’s website. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** MICs mortgage investment lawyer, News & Updates --- ### [FSRA’s Enforcement Activities - Syndicated Mortgages](https://baxsecuritieslaw.com/fsras-enforcement-activities-syndicated-mortgages/) **Published:** February 2, 2024 **Author:** Barbara Hendrickson **Excerpt:** An area of enforcement activity has been in the syndicated mortgage area,   Syndicated mortgages continue to be a regulatory minefield for many issuers. A case in point is the story of Hi-Rise Capital, a Toronto-based provider of syndicated mortgages.  In May 2023, the mortgage syndicator... **Content:** An area of enforcement activity has been in the syndicated mortgage area, Syndicated mortgages continue to be a regulatory minefield for many issuers. A case in point is the story of Hi-Rise Capital, a Toronto-based provider of syndicated mortgages. In May 2023, the mortgage syndicator was the subject of an enforcement action by the Financial Services Regulatory Authority of Ontario (FSRA), which resulted in the revocation of Hi-Rise’s mortgage brokerage license and mortgage administrator licence and the imposing of administrative penalties on the company and its mortgage broker /principal broker. Hi-Rise acted as the mortgage brokerage and mortgage administrator for a number of syndicated mortgage investment projects (“Projects”). The principal broker with Hi-Rise was the owner of Hi-Rise as well as the borrowers/developers of the Projects. FSRA found that as a mortgage brokerage, Hi-Rise did not: - adequately document investors’ suitability assessments in a way that demonstrated that an adequate suitability assessment was completed, contrary to subsection 24(1) of Ontario Regulation 188/08; - adequately identify project-specific risks to the investors contrary to sections 25 and 36 of Ontario Regulation 188/08; - adequately maintain policies and procedures, contrary to sections 40(1), and 40(2) of Ontario Regulation 188/08; - adequately disclose the relationships and conflicts of interest between Hi-Rise and other related entities contrary to sections 26, 27 and 33 of Ontario Regulation 188/08; and - use the “as is” value of a project when calculating the loan-to-value ratios in disclosures made to two investors on one project contrary to Sections 31(1)1 and 33 of Ontario Regulation 188/08. - In addition, Hi-Rise failed to adequately disclose fees contrary to sections 31(1) 1, 31(1)10, and 33 of Ontario Regulation 188/08. FSRA also found that as a mortgage administrator, Hi-Rise did not: - adequately disclose the nature of its relationship to the borrowers under the mortgages, contrary to sections 19, 20, and 21 of Ontario Regulation 189/08; - adequately disclose the fees it was entitled to receive as administrator contrary to section 15(1) of Ontario Regulation 189/08; - include mandatory information in the mortgage administration agreements contrary to sections 18(2)(5), 18(2)(6), and 18(3)(2) of Ontario Regulation 189/08; and - ensure that its concurrent business activities did not jeopardize its integrity, independence, and competence as administrator, contrary to section 40 of Ontario Regulation 189/08. You can read the full details of FSRA’s enforcement action [here.](https://teao.fsrao.ca/en/enforcement/2343) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** FSRA, MICs mortgage investment lawyer, News & Updates --- ### [New FINTRAC anti-money laundering and anti-terrorism requirements target mortgage sector](https://baxsecuritieslaw.com/new-fintrac-anti-money-laundering-and-anti-terrorism-requirements-target-mortgage-sector/) **Published:** October 17, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has published new anti-money laundering and anti-terrorism requirements (the new requirements) for the mortgage industry in Canada as stated under the Proceeds of Crime (Money Laundering) and Terrorist Finance Act (PCMLTFA) (the Act) and its... **Content:** The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has published new anti-money laundering and anti-terrorism requirements (the new requirements) for the mortgage industry in Canada as stated under the Proceeds of Crime (Money Laundering) and Terrorist Finance Act (PCMLTFA) (the Act) and its associated Regulations. The new requirements became effective October 11, 2024, and apply to Canadian mortgage administrators, brokers and lenders (the participants). Mortgage industry participants must: - Implement a compliance program that will include both the establishment of compliance policies and the appointment of a Compliance Officer; - Complete and submit an appropriate report to FINTRAC, if there are reasonable grounds to suspect a transaction is related to the commission or attempted commission of money laundering or terrorist activity financing offences; - Keep certain records, including records related to transactions and client identification Mortgage industry participants must verify the identity of persons and entities for certain activities and transactions, carry out other customer due diligence activities as described under the Act; and, - Apply all ministerial directives. To ensure compliance with the Act and its associated regulations, FINTRAC is authorized to conduct compliance examinations of mortgage industry participants. Some areas of review can include: - implementation of a compliance program; - reporting of all required transactions; - implementation of client identification; - record-keeping requirements; and, - third-party determination. It is important to note that FINTRAC has the legislative authority to issue administrative monetary penalties to mortgage industry participants found to be non-compliant. *FINTRAC’s requirements Mortgage administrators, brokers and lenders*[ *are available for download*](https://fintrac-canafe.canada.ca/re-ed/mortgage-hypotheque-eng#s2) from the website of the Financial Transactions and Reports Analysis Centre of Canada. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** MICs mortgage investment lawyer, News & Updates --- ### [FINTRAC Supports Mortgage Sector Compliance](https://baxsecuritieslaw.com/fintrac-supports-mortgage-sector-compliance/) **Published:** November 5, 2025 **Author:** Barbara Hendrickson **Content:** The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has published a set of resources to support Canadian mortgage industry compliance under the Proceeds of Crime (Money Laundering) and Terrorist Finance Act (PCMLTFA) and its associated Regulations, which became effective October 11, 2024. The resources are a series of short videos that the regulator is encouraging mortgage industry participants to view: - [Mortgage Sector: Compliance program requirements](https://fintrac-canafe.canada.ca/training-formation/mortgage-hypotheque/video-eng) - [The importance of suspicious transaction reports](https://fintrac-canafe.canada.ca/training-formation/str-dod/video1-eng) - [Understanding reasonable grounds to suspect](https://fintrac-canafe.canada.ca/training-formation/str-dod/video2-eng) - [What to consider when submitting a suspicious transaction report](https://fintrac-canafe.canada.ca/training-formation/str-dod/video3-eng) - [Mortgage Sector: Suspicious transaction reports](https://fintrac-canafe.canada.ca/training-formation/mortgage-hypotheque/video2-eng) *FINTRAC’s Requirements for mortgage administrators, brokers, and lenders* [ are available for download](https://fintrac-canafe.canada.ca/re-ed/mortgage-hypotheque-eng) from FINTRAC’s website. A complete list of FINTRAC’s video learning resources can be found [here.](https://fintrac-canafe.canada.ca/training-formation/training-formation-eng) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial, MICs mortgage investment lawyer --- ### [Competition Act Regulates Mergers & Acquisitions by Foreign and Canadian Companies](https://baxsecuritieslaw.com/3226-2/) **Published:** April 7, 2018 **Author:** Janny Cho **Excerpt:** *Article available in English and Chinese – The Competition Act is a federal statute administered and enforced by the Canadian Competition Bureau and the Public Prosecutions Service of Canada. The purpose of the Competition Act is to encourage competition in the Canadian marketplace, thereby benefiting... **Content:** \*Article available in English and Chinese – The Competition Act is a federal statute administered and enforced by the Canadian Competition Bureau and the Public Prosecutions Service of Canada. The purpose of the Competition Act is to encourage competition in the Canadian marketplace, thereby benefiting consumers. [Read the full article here](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/04/BAX-Competition-Act-English-version.pdf). 《加拿大竞争法》规管外国和加拿大公司的合并和收购 撰文: 曹静怡律师 | 2018-02-28 Competition Act《加拿大竞争法》是由加拿大竞争局（Canadian Competition Bureau）和加拿大公诉机构管理和执行的国家联邦法规。加拿大竞争法的目的是鼓励加拿大市场的竞争，从而使消费者受益。[阅读全文](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/04/BAX-Competition-Act-Chinese-version_F.pdf) **Categories:** Mergers and acquisitions lawyer, News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends The Creation Of An Ontario Regulatory Sandbox](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-the-creation-of-an-ontario-regulatory-sandbox/) **Published:** February 9, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas improving regulatory structure to enhance governance; improving competitiveness through regulatory measures; a level playing field between large and small market players; improving the proxy system, corporate governance and the process of mergers and acquisitions; fostering innovation; and modernizing enforcement and enhancing investor protection. Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #31 – Create an Ontario Regulatory Sandbox in order to benefit entrepreneurs and start-ups.** The Taskforce recommends the creation of an Ontario Regulatory Sandbox, undertaken jointly by the Ontario Securities Commission (OSC) LaunchPad and the Financial Services Regulatory Authority (FSRA), to “spur the growth of innovative companies.” The new Sandbox would have an expanded scope to include new and existing innovative start-ups operating across Ontario’s financial services sector. According to the Taskforce, firms should be allowed to test innovative products and business models with a “light regulatory touch.” In the longer term, the Taskforce proposes an expansion of this Sandbox into a Canadian Super Sandbox in which all provincial and federal financial services regulators allow Canadian financial services businesses to test their innovative ideas. This would spur innovation nationally. For a full copy of the Report:[ https://files.ontario.ca/books/mof-capital-markets-modernization-taskforce-final-report-en-2021-01-22-v2.pdf](https://files.ontario.ca/books/mof-capital-markets-modernization-taskforce-final-report-en-2021-01-22-v2.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Mergers and acquisitions lawyer, News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends Additional Powers For The Characterization Of Digital And Crypto Assets](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-additional-powers-for-the-characterization-of-digital-and-crypto-assets/) **Published:** February 9, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021 the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021 the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas: improving regulatory structure to enhance governance; improving competitiveness through regulatory measures; ensuring a level playing field between large and small market players; improving the proxy system, corporate governance and the process of mergers and acquisitions; fostering innovation and modernizing enforcement and enhancing investor protection. Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #32 – Digital and Crypto Assets** The Taskforce recommended that an expansion of the powers of the Ontario Securities Commission (OSC) to designate novel products as securities would provide regulatory clarity to businesses with unique offerings and appropriate protection to investors. According to the Report, digital and crypto assets continue to be an emerging area of the capital markets. The Report points to a variety of different types of crypto assets meriting different approaches to regulation. For example: - Certain crypto assets, such as Bitcoin and Ether, share many similarities with commodities, and are not currently in and of themselves, securities or derivatives; - Other crypto assets, such as digital or tokenized versions of traditional securities or derivatives with crypto assets as an underlying interest, are classified as securities and/or derivatives and are subject to regulatory requirements; and - “Crypto-asset contracts” (i.e., contractual rights to receive crypto assets), which in many cases constitute securities as evidence of indebtedness and investment contracts, are currently subject to regulatory requirements and may raise significant investor protection concerns. In the view of the Taskforce, there is uncertainty around the classification of these assets and certain financial assets, such as crypto assets, may benefit from the OSC’s regulatory oversight. The Report refers to jurisdictions, including the United Kingdom and the European Union, that have recently proposed comprehensive frameworks for the regulation of certain types of crypto assets. The Taskforce stated, in its view, providing the OSC with the power to designate certain crypto assets as securities and/or derivatives would alleviate market uncertainty. The Taskforce recommended giving the OSC expanded designation powers to make an order designating: - A derivative, or a class of derivatives, to be a security; - A security, or a class of securities, to be a derivative; - A contract or instrument, or a class of contracts or instruments, to not be a derivative; and - A security, or a class of securities, to not be a security. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Capital markets lawyer, Mergers and acquisitions lawyer, News & Updates --- ### [Joint Canadian Securities Administrators/ Investment Regulatory Organization of Canada Staff Notice 21-330 Guidance for Crypto - Trading Platforms: requirements relating to Advertising, Marketing and Social media Use.](https://baxsecuritieslaw.com/joint-canadian-securities-administrators-investment-regulatory-organization-of-canada-staff-notice-21-330-guidance-for-crypto-trading-platforms-requirements-relating-to-advertising-marketing-and/) **Published:** October 5, 2021 **Author:** Barbara Hendrickson **Excerpt:** On September 23, 2021 the Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) published a staff notice (Notice) concerning certain advertising activities and marketing strategies by platforms that trade crypto assets (Crypto- Trading Platforms, or CTPs) that may breach certain... **Content:** On September 23, 2021 the Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) published a staff notice (Notice) concerning certain advertising activities and marketing strategies by platforms that trade crypto assets (Crypto- Trading Platforms, or CTPs) that may breach certain requirements of securities legislation. The Notice includes an overview of the principal requirements under securities legislation and IIROC rules in relation to advertising and marketing, including through the use of social media, and is intended to assist existing registrants and prospective registrants (platforms that may be considering establishing a CTP as a new business line who require registration) regarding - statements in advertising and marketing materials that could be considered false or misleading, - concerns over the use of gambling-style contests, promotions or schemes, such as the offering of bonuses or rewards based on the level of trading, that may encourage excessive trading by retail investors, - compliance and supervisory challenges when using social media to promote CTPs, and - complying with securities legislation generally. The Notice identifies a number of potentially false or misleading statements in advertising or marketing materials that a CTP may engage in, including those that suggest that a CTP is registered under securities legislation where this is not the case or that a securities regulatory authority or regulator has approved or endorsed the CTP, any products offered. The Notice specifically refers to contests, promotions, bonuses and time-limits to encourage investors to engage in trading and to act quickly for fear of missing out on an investment opportunity or a reward. The Notice also refers to advertising and marketing strategies designed to encourage trading may be considered a form of solicitation or invitation to trade and may therefore trigger suitability obligations for registered CTPs. The Notice provides that registered CTPs must consider compliance and supervision when using social media websites and platforms (social media sites) as a means of communicating with clients and the general public. The use of social media sites increases the risk that CTPs may not be retaining adequate records of their business activities and client communications on interactive social media web sites that include the posting of both real time and static content. CTPs must design systems that allow for compliant record retention as well as retrieval capability. The Notice requires that CTPs supervise social media as necessary, particularly considering the provisions in securities legislation relating to the use of misleading and false statements. The CTP’s review of electronic communications must be sufficient to meet its supervisory obligations which extend to the CTP’s directors, officers, employees, shareholders and other third parties acting on behalf of the CTP. The Notice also reminds CTPs that they are required to adopt appropriate policies and procedures governing the use of social media for marketing which provide for the review, supervision, retention and retrieval of advertising and marketing materials, including marketing done on social media web sites, the designation of an appropriate individual to be responsible for the supervision or approval of marketing communications, and a system to monitor compliance with policies and procedures, including record retention and retrieval capability. The CSA reminds registered CTPs and prospective CTP registrants that CSA staff may review advertising and marketing as part of the registration review process and following registration as part of a compliance review. False or misleading advertising and improper marketing strategies raise concerns relating to the fitness of the firm and its principals for registration (particularly in terms of the fitness for registration criteria of integrity and proficiency). CSA members may take enforcement action against CTPs, including foreign-based CTPs that have investors in Canada, that do not comply with the requirements of securities legislation. For a copy of the Notice please see: [https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-2/21330-CSA–IIROC-Joint-Staff-Notice-September-23-2021.pdf](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-2/21330-CSA--IIROC-Joint-Staff-Notice-September-23-2021.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Marketing & Business Development, News & Updates --- ### [Latest British Columbia Securities Commission Compliance Report Card Reveals Continuing Problems with Issuer’s Marketing Materials](https://baxsecuritieslaw.com/latest-british-columbia-securities-commission-compliance-report-card-reveals-continuing-problems-with-issuers-marketing-materials/) **Published:** May 25, 2022 **Author:** Barbara Hendrickson **Excerpt:** The British Columbia Securities Commission (BCSC)’s most recent Compliance Report Card of investment dealers and advisers reflects the past year’s focus on marketing materials these firms use to attract and retain clients. The Report Card highlights several recurring deficiencies in how some B.C.-based portfolio managers, investment... **Content:** The British Columbia Securities Commission (BCSC)’s most recent Compliance Report Card of investment dealers and advisers reflects the past year’s focus on marketing materials these firms use to attract and retain clients. The Report Card highlights several recurring deficiencies in how some B.C.-based portfolio managers, investment fund managers and exempt market dealers hold themselves out to the public, including: - Posting information and marketing materials that are no longer current, - Unsubstantiated and/or overly promotional claims, - Failure to provide references and sources for third-party information used in marketing materials, and, - Making social media posts that have misleading or overly promotional claims and statements. The focus of the Report Card on marketing in 2021 was part of a national effort, coordinated by the Canadian Securities Administrators, of which the BCSC is a member. The goal of the report card was to pinpoint problems before they arose with expectation that marketing efforts are carried out in a responsible manner by registrants. In 2021, the BCSC conducted 31 compliance reviews and found 210 deficiencies, averaging 6.77 deficiencies per review. This is down from an average of 8.14 deficiencies per review in the previous year, in large part due to the narrower focus on marketing. The reviews also revealed that some firms are falling short of requirements to Know Your Client (KYC) and their obligation to determine the suitability of investments for each client. Some firms that recently registered, following the repeal of the Mortgage Investment Entity (MIE) registration exemption, are falling short in certain areas. Some of the deficiencies, either in marketing or other areas, were significant failures of compliance that led the BCSC to impose terms and conditions on registration, such as requiring the hiring of a compliance monitor or preventing new clients from being onboarded until the failures have been corrected. The BCSC put restrictions on several registered firms this year. In addition, several cases were referred to the BCSC’s Enforcement Division for further investigation, which could lead to public allegations of misconduct, a hearing and possible sanctions. During the year, the BCSC reports it has made settlements with several firms based on poor registrant conduct, as well as imposing sanctions on individuals for registration matters. The 2021 British Columbia Securities Commission Compliance Report Card is available for download from the BCSC [website.](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Industry/Registrant-Regulation/Compliance-Toolkit/2021-CMR-Annual-Compliance-Report-Card.pdf) 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. **Categories:** Marketing & Business Development, News & Updates --- ### [BCSC Publishes Guidance On Misrepresentations And False And Misleading Statements](https://baxsecuritieslaw.com/bcsc-publishes-guidance-on-misrepresentations-and-false-and-misleading-statements/) **Published:** December 17, 2024 **Author:** Barbara Hendrickson **Excerpt:** The British Columbia Securities Commission (BCSC) has published BC Notice 15-702 Prohibitions against Misrepresentations and False or Misleading Statements (The Staff Notice). The Staff Notice provides guidance about the prohibitions in sections 50(2) and 50(3) of the British Columbia Securities Act (the Act) against misrepresentations... **Content:** The British Columbia Securities Commission (BCSC*)* has published *BC Notice 15-702 Prohibitions against Misrepresentations and False or Misleading Statements* (The Staff Notice). The Staff Notice provides guidance about the prohibitions in sections 50(2) and 50(3) of the British Columbia Securities Act (the Act) against misrepresentations and against false or misleading statements or information while engaged in a promotional activity. Generally: - Section 50(2) replaced a previous misrepresentation provision of the Act, section 50(1)(d). Section 50(2) prohibits a person from making a statement that the person knows, or reasonably should know, is a misrepresentation. For there to be a contravention, the statement must be about a material fact, which is defined in the Act as a fact that would reasonably be expected to have a significant effect on the market price or value of a security or on the market price or value of, or obligations under, a derivative. - Section 50(3) prohibits a person engaged in a promotional activity from making a statement or providing information that is false or misleading or that omits a fact necessary to make the statement or information not false or misleading in circumstances where a reasonable investor would consider that statement or omission important when deciding to buy or trade a security or derivative or in deciding not to buy or trade. Unlike section 50(2) of the Act, section 50(3) does not require that the statement, information or omission concern a material fact. The regulator notes that this prohibition extends to disclosure and continuous disclosure documents in connection to offerings, but to also online securities promotions or marketing, such as promotions on social media, in chat rooms, videos, emails and newsletters. Any BC market participants making statements, whether oral or written about securities or derivatives must comply with sections 50(2) and 50(3) of the Act. The regulator notes that the prohibitions may be broader than in some other Canadian provinces and territories. Additionally, the regulator warns that it will be applying these standards in disclosure reviews and advises that Enforcement staff will be acting against those market participants it finds in violation of these provisions. *BC Notice 15-702 Prohibitions against Misrepresentations and False or Misleading Statements* [ is available for download](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/1-procedure-related-matters/current/15-702/bcn-15-702-december-12-2024) from the website of the British Columbia Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Marketing & Business Development, News & Updates --- ### [Structuring a Cross-Border Securities Offering: Common U.S. Exemptions for Private Placements](https://baxsecuritieslaw.com/structuring-a-cross-border-securities-offering-common-u-s-exemptions-for-private-placements/) **Published:** November 23, 2025 **Author:** Barbara Hendrickson **Content:** Canadian companies increasingly look south of the border for growth capital, drawn by deeper U.S. markets and sophisticated investor bases. However, navigating U.S. securities laws requires careful attention to both registration exemptions and broker-dealer requirements. U.S. securities laws require registration of all securities offerings unless a specific exemption applies. For Canadian issuers, full SEC registration involves significant time, cost, and ongoing compliance obligations that may not align with immediate capital needs or business timelines. The key exemptions include: **Section 4(a)(2) – Private Offering Exemption** This is the original statutory exemption that allows companies to raise unlimited capital from sophisticated investors without registration but requires careful legal analysis since there are no bright-line rules to follow to follow without safe harbor protection. As the statutory foundation for private offerings, it requires careful fact-specific analysis and creates the conceptual framework that underlies all modern private placement exemptions. Unlike Canadian prospectus exemptions which provide clear numerical thresholds (such as the $150,000 minimum investment exemption), Section 4(a)(2) relies on judicial interpretation and SEC guidance, making it inherently less predictable but more flexible for sophisticated transactions. The following are the requirements for the private offering exemption: **Offeree Sophistication**: Each offeree must have sufficient knowledge and experience to evaluate the investment’s merits and risks, or access to such information through advisors. Courts apply the “fend for himself” standard. This standard is more subjective than Canadian “accredited investor” definitions, requiring case-by-case analysis of each investor’s business experience, financial knowledge, and ability to bear economic risk. **Access to Information**: Offerees must have access to the same type of information available in a registration statement, or the issuer must reasonably believe they have such access – typically satisfied through comprehensive private placement memoranda and management presentations. This requirement often exceeds Canadian disclosure obligations under NI 45-106, necessitating more detailed risk factor analysis and financial statement presentation. **Investment Intent**: Purchasers must acquire securities for investment, not immediate distribution – demonstrated through investment letters and transfer restrictions. Canadian securities laws similarly require investment intent, but U.S. practice demands more detailed documentation of holding period intentions and resale restrictions. **Limited Numbers**: While no bright-line test exists, courts typically scrutinize offerings with more than 25-35 offerees – count includes all persons approached, not just purchasers. This contrasts sharply with Canadian exemptions that focus on purchaser qualifications rather than the total number of persons solicited. **No General Solicitation**: Marketing limited to pre-existing relationships – “substantial relationship” test requires meaningful prior contact. **Documentation:** Comprehensive private placement offering memorandum with registration-quality disclosure, including detailed business model analysis, comprehensive risk factors, competitive landscape assessment, and management compensation details that often exceed Canadian OM requirements; investor questionnaires establishing sophistication and accredited status with more detailed financial and experience verification than typically required under Canadian regulation; investment representation letters confirming investment intent and resale restrictions; and a subscription agreement with detailed representations and warranties. **Rule 506(b) – Private Placement Safe Harbor** This safe harbor rule provides clear guidelines for private placements, allowing unlimited fundraising from accredited investors plus up to 35 sophisticated non-accredited investors, with no general advertising permitted. Rule 506(b) serves as the practical workhorse for most private placements, offering greater certainty than Section 4(a)(2) while maintaining flexibility for sophisticated offerings**.** The rule’s structure mirrors certain Canadian exemptions but with more rigorous verification requirements. While Canadian regulations often rely on investor self-certification, Rule 506(b) places greater due diligence burdens on issuers to verify investor qualifications. Rule 506(b) provides certainty through specific compliance requirements: **Accredited Investor Definition**: Natural persons with $1+ million net worth (excluding primary residence) or $200K+ annual income ($300K+ joint) – updated definitions include certain professionals and knowledgeable employees. **Non-Accredited Investor Limits**: Maximum of 35 purchasers who must be sophisticated (able to evaluate investment merits) – issuer bears burden of demonstrating sophistication. This mixed investor class approach is unique to U.S. regulations; Canadian exemptions typically require all investors to meet specific qualification criteria without allowing sophisticated but non-accredited participants. **Disclosure Obligations**: For non-accredited investors, issuers must provide audited financial statements and information comparable to Part I of Form S-1 **–** which creates a two-tier disclosure system. This tiered disclosure requirement is more complex than Canadian systems, which generally apply uniform disclosure standards regardless of investor accreditation status. **Form D Filing**: Issuers must file within 15 days of first sale – failure doesn’t destroy exemption but triggers SEC enforcement risk. **Bad Actor Disqualification**: Comprehensive background checks required for covered persons – includes issuer, predecessors, affiliates, directors, officers, and 20%+ shareholders. **Rule 506(c) – General Solicitation Permitted** Rule 506(c) represents a significant departure from traditional private placement restrictions, allowing public advertising and general solicitation in exchange for enhanced investor verification requirements. This exemption is particularly valuable for Canadian issuers seeking to access broader U.S. investor networks through digital marketing and public presentations. Enhanced verification requirements in exchange for marketing flexibility: **Reasonable Steps Standard**: Issuers must take reasonable steps to verify accredited investor status – objective standard based on facts and circumstances. This verification standard is significantly more rigorous than Canadian self-certification approaches, requiring documentary evidence and third-party confirmations. **Acceptable Verification Methods**: Tax returns, W-2s, 1099s for income tests; bank/brokerage statements, appraisals for net worth test; written confirmation from a registered broker-dealer, investment adviser, licensed attorney, or CPA. Third-party confirmations must be dated within 90 days. Existing accredited investor certifications (with limitations) – the issuer cannot rely solely on investor self-certification. **Regulation S – Offshore Safe Harbor** This exemption allows Canadian companies to raise capital outside the U.S. without any registration requirements, provided they implement procedures to ensure no U.S. persons participate and observe a 40-day restriction period. Regulation S is particularly valuable for Canadian issuers conducting concurrent offerings in multiple jurisdictions, as it provides a clear framework for excluding U.S. persons while accessing international capital markets. Requirements (Category 2) typical for Canadian issuers include: **40-day distribution compliance period:** During this time, securities cannot be sold to U.S. persons – begins from later of offering commencement or last allotment. **Offering restrictions:** No directed selling efforts in the U.S. – includes advertising, seminars, or other promotional activities targeting U.S. markets. **Purchaser representations:** Confirmation of non-U.S. person status – requires reasonable procedures to verify offshore status by the issuer. **Resale restrictions:** Appropriate legends and transfer restrictions – the issuer must prevent flowback during compliance period. **Rule 144A – Institutional (QIB) Market Access** This exemption targets large institutional investors (those with $100+ million in assets) and provides access to a liquid secondary trading market, making it ideal for larger offerings to sophisticated institutions. QIB requirements include: **$100 million threshold**: Institutions must own/invest at least $100 million in securities of non-affiliates – calculated on discretionary basis for investment managers. **Information rights**: Reasonable current information must be available to holders and prospective purchasers – satisfied through ongoing reporting or upon request basis. **Rule 144 – Resale Safe Harbor** Rule 144 provides the critical bridge between private placements and public trading, establishing the framework for resale of restricted securities. For Canadian issuers, Rule 144 compliance is essential for maintaining investor liquidity expectations and supporting secondary market development. The key requirements for resale safe harbor are: **Holding Period:** Minimum one-year holding period for securities acquired in private placements from reporting companies; two years for non-reporting companies (Canadian issuers without SEC reporting obligations typically fall into this category). **Current Information**: Issuer must have current public information available (Form 10-K, 10-Q, 8-K filings or equivalent) – Canadian issuers can satisfy this through continuous disclosure filings in Canada if properly structured. **Volume Limitations:** Sales limited to 1% of outstanding shares or average weekly trading volume over preceding four weeks – requires careful coordination with Canadian market trading patterns **Manner of sale:** Sales must be conducted in ordinary brokerage transactions without solicitation – prohibits special selling efforts or premium pricing arrangements. **Notice requirements:** Form 144 filing required for sales exceeding specified thresholds – creates ongoing compliance obligations for selling. For Canadian companies, the U.S. capital markets offer unparalleled depth and sophistication, but success requires understanding that U.S. securities regulation operates on different principles than Canadian law. Canadian issuers must carefully structure their U.S. private placements to facilitate US securities compliance, including maintaining appropriate disclosure standards and coordinating with Canadian securities law requirements. For more insights on cross-border securities offerings and U.S. capital markets access, contact Robb Miller at or Barbara Hendrickson at . 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. **Categories:** Business Law, Governments, Marketing & Business Development --- ### [Securities regulators access model for prospectuses of non-investment fund reporting issuers](https://baxsecuritieslaw.com/securities-regulators-access-model-for-prospectuses-of-non-investment-fund-reporting-issuers/) **Published:** January 22, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published final amendments and changes to several national instruments and companion policies, implementing an access model for prospectuses of non-investment fund reporting issuers (the Access Model). The goal of the Access Model is to modernize the way prospectuses are... **Content:** The Canadian Securities Administrators (CSA) have published final amendments and changes to several national instruments and companion policies, implementing an access model for prospectuses of non-investment fund reporting issuers (the Access Model). The goal of the Access Model is to modernize the way prospectuses are made available to investors by providing public electronic access to a prospectus and alerting investors that the document is accessible through SEDAR+ will either satisfy the conditions of an exemption from the requirements under securities legislation to send a prospectus (in British Columbia, Québec and New Brunswick), or constitute delivery for the prospectus, generally, under securities legislation (in the other CSA members jurisdictions). The Access Model is not mandatory for issuers. Under this model, prospective purchasers or purchasers will continue to be able to request a copy of a preliminary prospectus or final prospectus in electronic or paper form. Provided all necessary approvals are obtained, the amendments and changes for the implementation of the Access Model will come into force on April 16, 2024. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Investment fund lawyer, News & Updates --- ### [Canadian Securities Regulators Publish Proposed Amendments to National Instrument 81-102 Investment Funds Pertaining to Crypto Assets for Comment](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-proposed-amendments-to-national-instrument-81-102-investment-funds-pertaining-to-crypto-assets-for-comment/) **Published:** January 23, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published for a 90-day comment period ending April 17, 2024, Proposed Amendments to National Instrument 81-102 Investment Funds Pertaining to Crypto and proposed changes to Companion Policy 81-102CP Investment Funds (81-102CP) (the Proposed Amendments). The Proposed Amendments concern reporting... **Content:** The Canadian Securities Administrators (CSA) has published for a 90-day comment period ending April 17, 2024, *Proposed Amendments to National Instrument 81-102 Investment Funds Pertaining to Crypto* and proposed changes to Companion Policy 81-102CP *Investment Funds* (**81-102CP**) (the **Proposed Amendments**). The Proposed Amendments concern reporting issuer investment funds investing directly or indirectly in crypto assets (**Public Crypto Asset Funds**). **Substance and Purpose** The Proposed Amendments set out proposed regulatory requirements aimed at protecting investors and reducing investor risk in public investment funds investing in crypto assets. They include crypto asset investment restrictions and custodial obligations. The Proposed Amendments are the second phase of a project to implement a Canadian regulatory framework for public investment funds holding crypto assets. They cover key operational matters, such as: - criteria regarding the types of crypto assets that Public Crypto Asset Funds are permitted to purchase, use, or hold; - restrictions on investing in crypto assets by Public Crypto Asset Funds or other types of reporting issuer investment funds; and, - requirements concerning custody of crypto assets held on behalf of a Public Crypto Asset Fund. The Proposed Amendments are expected to codify practices of existing Public Crypto Asset Funds. They were developed mainly through the prospectus review process, as well as codifying exemptive relief previously granted to existing Public Crypto Asset Funds. Stakeholders are invited to provide comments in writing on or before April 17, 2024. *CSA Notice and Request for Comment – Proposed Amendments to National Instrument 81-102 Investment Funds Pertaining to Crypto Assets* is [available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/8/81-102-81-102cp/csa-notice-and-request-comment-proposed-amendments-national-instrument-81-102-0) from CSA members’ websites. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Crypto lawyer, Investment fund lawyer, News & Updates --- ### [Canadian Securities Administrators Propose Amendments to Modernize Continuous Disclosure Regime for Investment Funds](https://baxsecuritieslaw.com/canadian-securities-administrators-propose-amendments-to-modernize-continuous-disclosure-regime-for-investment-funds/) **Published:** October 2, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published for review and comment a series of proposed amendments (The Proposed Amendments ), aimed at modernizing the continuous disclosure regime for investment funds for a period ending January 7, 2025. The Proposed Amendments are designed to provide investors... **Content:** The Canadian Securities Administrators (CSA) have published for review and comment a [series of proposed amendments](https://www.securities-administrators.ca/news/canadian-securities-administrators-propose-amendments-to-modernize-continuous-disclosure-regime-for-investment-funds/#IFCDM) (The Proposed Amendments ), aimed at modernizing the continuous disclosure regime for investment funds for a period ending **January 7, 2025**. The Proposed Amendments are designed to provide investors with more focused and valuable disclosure while reducing the regulatory burden on investment fund managers. The CSA proposes to replace the existing annual and interim Management Report of Fund Performance (MRFP) with a new annual and interim Fund Report. The proposed Fund Report was developed using behavioural insights research, which provides information on how people think, behave and make decisions. This included carrying out rigorous investor testing aimed at comparing the effectiveness of several alternative proposed versions of the Fund Report against a sample MRFP. Among the continuous disclosure-related proposals put forward are: - Provide exemptions from certain conflict of interest reporting requirements in securities legislation if other similar requirements are satisfied; and, - Eliminate some required class- or series-level disclosures from investment fund financial statements not required by International Financial Reporting Standards. The British Columbia Securities Commission (BCSC) is currently not publishing the Proposed Amendments for comment. BCSC Staff anticipate doing so following the British Columbia provincial general election, scheduled for October 19, 2024. The Proposed Amendments [*are available for download*](https://www.securities-administrators.ca/news/canadian-securities-administrators-propose-amendments-to-modernize-continuous-disclosure-regime-for-investment-funds/#IFCDM) from the website of the Participating Jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Investment fund lawyer, News & Updates --- ### [CSA Publishes Amendments To Modernize The Prospectus Filing Model For Certain Investment Funds](https://baxsecuritieslaw.com/csa-publishes-amendments-to-modernize-the-prospectus-filing-model-for-certain-investment-funds/) **Published:** December 5, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) are adopting amendments to National Instrument 41-101 General Prospectus Requirements (NI 41-101), National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101), related consequential amendments to NI 41- 101, NI 81-101 and National Instrument 81-106 Investment Fund Continuous Disclosure (NI 81-... **Content:** The Canadian Securities Administrators (CSA) are adopting amendments to National Instrument 41-101 *General Prospectus Requirements* (NI 41-101), National Instrument 81-101 *Mutual Fund Prospectus Disclosure* (NI 81-101), related consequential amendments to NI 41- 101, NI 81-101 and National Instrument 81-106 *Investment Fund Continuous Disclosure* (NI 81- 106) and related consequential changes to Companion Policy 41-101 *General Prospectus Requirements* (41-101CP), and Companion Policy 81-101 *Mutual Fund Prospectus Disclosure* (81-101CP) (collectively, the Amendments). The Amendments: - extend the lapse date for investment funds in continuous distribution from 12 months to 24 months, which will allow investment funds in continuous distribution to file their pro forma prospectuses biennially, rather than annually (Lapse Date Extension), and - repeal the requirement to file a final prospectus no more than 90 days after the issuance of a receipt for a preliminary prospectus (90-Day Rule Repeal) for all investment funds. Implementation of the Amendments will modernize the prospectus filing model for investment funds, with a particular focus on investment funds in continuous distribution. The CSA’s modernization will better reflect the shift from the delivery of the prospectus to the delivery of the Fund Facts and ETF Facts to investors and reduce unnecessary regulatory burden imposed by the current prospectus filing requirements under securities legislation on investment funds without affecting the currency or accuracy of the information available to investors to make an informed investment decision. In some jurisdictions, ministerial approvals are required for the implementation of the Amendments. Provided all ministerial approvals are obtained, the Amendments to NI 81-101, NI 41-101 and NI 81-106 will come into force on March 3, 2025 (the **Effective Date**). The Amendments [ are available for download](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/4-distribution-requirements/current/41-101/41-101-and-81-101-csa-advance-notice-november-28-2024) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Investment fund lawyer, News & Updates --- ### [CSA Announces Exemptions for Investment Funds to Facilitate Access to The Bank Of Canada’s Contingent Term Repo Facility](https://baxsecuritieslaw.com/csa-announces-exemptions-for-investment-funds-to-facilitate-access-to-the-bank-of-canadas-contingent-term-repo-facility/) **Published:** July 30, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) recently published *CSA Notice 81-930 – Exemptions from Certain Repurchase Transactions Requirements for Investment Funds,* a coordinated series of blanket orders granting exemptive relief to facilitate access to the Bank of Canada’s (the Bank) [Contingent Term Repo Facility](https://www.bankofcanada.ca/markets/market-operations-liquidity-provision/market-operations-programs-and-facilities/contingent-term-repo-facility/) (CTRF) for eligible investment funds. The Bank’s CTRF is designed to support the stability of the Canadian financial system and to counter future, severe market-wide liquidity stresses. The CTRF is activated and deactivated at the Bank’s discretion and offers Canadian-dollar funding for a term of up to 30 days to eligible participants against securities issued or guaranteed by the Government of Canada or a provincial government. Investment funds with exposure to Canadian dollar money market and/or fixed income securities may need to access the CTRF to better manage their liquidity if there is a severe market-wide liquidity stress event. The blanket orders remove restrictions that would have impeded eligible investment funds from being able to participate in the CTRF. The orders facilitate access to a potential liquidity risk management tool for eligible investment funds to proactively manage their liquidity during times of severe market conditions. *CSA Notice 81-930 – Exemptions from Certain Repurchase Transactions Requirements for Investment Funds* [ is available for download](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/8--investment-funds/current/81-930/81930-csa-notice-july-24-2025) from the websites of the participating jurisdictions of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Investment fund lawyer, News & Updates --- ### [CSA Reduces Regulatory Burden for Continuous Disclosure for Investment Funds](https://baxsecuritieslaw.com/csa-reduces-regulatory-burden-for-continuous-disclosure-for-investment-funds/) **Published:** February 4, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) have published a series of Final Amendments are designed to reduce the regulatory burden on investment fund managers while maintaining the quality and timeliness of disclosure for investors. Together, *CSA Notice of Amendments to National Instrument 81-101 Mutual Fund Prospectus Disclosure, National Instrument 81-102 Investment Funds, National Instrument 81-106 Investment Fund Continuous Disclosure, National Instrument 81-107 Independent Review Committee for Investment Funds and Changes to the Commentary in National Instrument 81-107 Independent Review Committee for Investment Funds – Modernization of the Continuous Disclosure Regime for Investment* (the Final Amendments), modernize the continuous disclosure regime for investment funds. The Final Amendments include: - Exemptions from certain conflict of interest reporting requirements in securities legislation where similar requirements are already satisfied; - Elimination of certain class- or series-level disclosures from investment fund financial statements that are not required under International Financial Reporting Standards; and, - Minor editorial and other revisions to the simplified prospectus form. A key part of The Final Amendments is the new annual and Interim Fund Report which replaces the existing annual and interim Management Report of Fund Performance (MRFP). The aim of the Fund Report is to create a document that is more streamlined and significantly less burdensome for fund managers to prepare, and more likely to be read and understood by investors compared to the MRFP. Based on stakeholder feedback, the regulator expects to develop and test a revised Fund Report that will be published later for a subsequent comment period. The Final Amendments come into force April 22, 2026. *CSA Notice of Amendments to National Instrument 81-101 Mutual Fund Prospectus Disclosure, National Instrument 81-102 Investment Funds, National Instrument 81-106 Investment Fund Continuous Disclosure, National Instrument 81-107 Independent Review Committee for Investment Funds and Changes to the Commentary in National Instrument 81-107 Independent Review Committee for Investment Funds – Modernization of the Continuous Disclosure Regime for Investment Funds* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/8/81-101-81-101cp/csa-notice-amendments-national-instrument-81-101-mutual-fund-prospectus-disclosure) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial, Investment fund lawyer --- ### [FSRA Discusses its Plans for Principles Based Regulation](https://baxsecuritieslaw.com/fsra-discusses-its-plans-for-principles-based-regulation/) **Published:** October 9, 2019 **Author:** Barbara Hendrickson **Excerpt:** As part of the Financial Services Regulatory Authority (FSRA) of Ontario’s mandate was the new regulator’s introduction of Principles Based Regulation (PBR), representing a marked shift from previous provincial regulatory regimes. The PBR approach integrates the current legislative scheme for the mortgage, insurance and financial... **Content:** As part of the Financial Services Regulatory Authority (FSRA) of Ontario’s mandate was the new regulator’s introduction of Principles Based Regulation (PBR), representing a marked shift from previous provincial regulatory regimes. The PBR approach integrates the current legislative scheme for the mortgage, insurance and financial services industry subject to regulation by FSRA. In a presentation to stakeholders on September 24, 2019, FSRA’s Vice President, Legal and Enforcement, Jordan Solway, discussed the concept of PBR. “Principles Based Regulation,” said Solway, “moves us away from detailed, prescriptive rules and relies more on high level, broadly stated rules or principles to set standards by which regulated firms and individuals must conduct business.” He added that this did not mean that PBR could not have rules, such as statutory provisions, or other regulations, but these would be implemented in a principles-based manner. PBR has three main elements that set it aside from other regulatory environments: greater reliance on broad-based standards in preference to detailed rules; a move to outcomes-based regulation; and an increasing emphasis on senior management responsibility. Solway used an example of a highway to illustrate the distinction between PBR and rules-based regulation. A rule, he said, might be to not to drive faster than 90 km/h. A principle might be to not drive faster than is reasonable and prudent in all of the circumstances. Under PBR, the regulator would investigate the range of relevant driving conditions and apply the background principle of what is reasonable to the situation. Meanwhile, the driver must determine what is best to achieve the requirement of driving no faster than is reasonable and prudent in the circumstances. Solway said rules-based regulatory environments have proven problematic. First, he noted, rules are simply are what he called “best guesses” at what might happen in the future and are not “future proof.” New situations, he said, might arise that the regulator has not anticipated and the rule may be interpreted in ways not originally intended. Second, he said, it has been very difficult in the past to align rules with their intended purposes, as they have either missed things that regulator wanted to catch or conversely, cast too wide a net, snaring things the regulator never intended to catch. Third, he said, whether a given rule is clear depends on a shared understanding. Failure to have such an understanding could make for troubles, later on. Fourth, and finally, he said, just because a particular rule or principle is in place, does not mean it will have the desired effect. Regulators must consider factors such as enforcement and the attitude of individual companies. “However,” said Solway, “since PBR gives the regulatory regime more flexibility, it allows it to respond to new issues without creating new rules.” This would allow for future-proofing, and help ensure the system worked as intended. The principles would both express the rationale for the rule and provide overarching requirements and can be applied flexibly to meet a shifting situation. They would make use of such qualitative and often evaluative terms such as “fair,” “reasonable,” and “suitable.” The expectation, he said, is that the regulated firms would “internalize” these principles, creating a compliance culture. “Principles Based Regulation,” said Solway, “relies on both best and good practices emanating from industry to help define the content of PBR requirements, creating a feedback loop between regulator and industry.” However, he noted that successful PBR requires more than the drafting of rules and regulations that are principles-based. It needs, he said, to be accompanied by: • Transparent, accessible, ongoing guidance and communication from the regulator; • Efforts to incorporate industry experience (including best and good practices); • Analytical methods such as outcome and risk-based analysis to evaluation regulatory success and allocate resources; and, • Utilization of a variety of regulatory tools, ranging from moral suasion and warnings to criminal penalties and license suspensions. As a regulatory approach, Solway said, PBR can facilitate compliance as it allows businesses to honour the spirit of the law by developing policies or other mechanisms that simultaneously comply with the rule and meet their individual needs. 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. **Categories:** FSRA, News & Updates --- ### [FSRA Sets Out its New Standard Guidance Approach](https://baxsecuritieslaw.com/fsra-sets-out-its-new-standard-guidance-approach/) **Published:** October 23, 2019 **Author:** Barbara Hendrickson **Excerpt:** The newly-created Financial Services Regulatory Authority of Ontario (FSRA), has announced a standardized approach to guidance (the New Approach), replacing the legacy systems it had inherited from its predecessor regulatory bodies. This change had come in response to stakeholder requests for clarification. The regulator has... **Content:** The newly-created Financial Services Regulatory Authority of Ontario (FSRA), has announced a standardized approach to guidance (the New Approach), replacing the legacy systems it had inherited from its predecessor regulatory bodies. This change had come in response to stakeholder requests for clarification. The regulator has proposed that the New Approach will consist of four new guidance categories (the categories) to communicate and support requirements set out in legislation, rules, and regulations: - **Interpretation:** Stating the regulator’s view of requirements under law (i.e. legislation, regulations, and rules) so that stakeholders are aware of when non-compliance may lead to enforcement or other supervisory action. - **Information:** Presenting FSRA’s views on desirable or undesirable practices or public interest concerns, without creating or interpreting the obligations of regulated persons. - **Approach:** DescribingFSRA’s internal principles, processes, and practices for performing regulatory duties, taking supervisory action, or exercising at the regulator’s discretion or other regulatory powers. - **Decision:** Setting out FSRA’s rationale for a specific regulatory decision that may establish a precedent for the interest of other parties directly not involved in the matter. Depending on the specific circumstances, the regulator will use a category to establish standard structures for stakeholders in a given regulatory sector. It is the goal of FSRA staff to use the new categories to build standard structures and styles for guidance that it believes will help stakeholders easily understand and differentiate between these categories. More information about the New Approach [can be found on the website](https://www.fsrao.ca/newsroom/fsra-issues-new-guidance-framework-clarify-requirements-regulated-sectors) of the Financial Services Regulatory Authority of Ontario (FSRA). 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. **Categories:** FSRA, News & Updates --- ### [FSRA to Toughen Rules for Financial Planner, Financial Advisor Definitions](https://baxsecuritieslaw.com/fsra-to-toughen-rules-for-financial-planner-financial-advisor-definitions/) **Published:** November 25, 2019 **Author:** Barbara Hendrickson **Excerpt:** [et_pb_section admin_label="section"] [et_pb_row admin_label="row"] [et_pb_column type="4_4"][et_pb_text admin_label="Text"] The Financial Services Regulatory Authority (FSRA) of Ontario has taken its first steps in bringing financial planners and financial advisors (planners and advisors) under its aegis, by opening with discussions with stakeholders regarding a plan that would firm... **Content:** [et_pb_section admin_label=”section”] [et_pb_row admin_label=”row”] [et_pb_column type=”4_4″][et_pb_text admin_label=”Text”] The Financial Services Regulatory Authority (FSRA) of Ontario has taken its first steps in bringing financial planners and financial advisors (planners and advisors) under its aegis, by opening with discussions with stakeholders regarding a plan that would firm up rules regarding the use of the titles and cracking down on individuals who manage money and call themselves planners or advisors without any qualifications. Earlier in the year, [*the Financial Professionals Title Protection Act, 2019*](https://www.ontario.ca/laws/statute/19f07b) (the Act) was passed by the Ontario legislature but not yet given Royal Assent. The Act requires anyone in working in the financial services industry who wants to use the advisor or planner titles to have the appropriate credentials and remain in good standing. According to an article published on November 22, 2019 in the *Globe and Mail*, in preparation for the Act’s implementation, FSRA has begun conversations with stakeholders over the development of credentials governing the planner and advisor titles and the rules enforcing their usage. The regulator was quoted saying the consultation process will run for the first six months of 2020, followed by a 90-day comment period with the initial rules in place by year-end. The regulator expects that the initial rules, in addition to covering the enforcement process and credential and educational requirements, may also grandfather certain classes of advisors or planners. Canada currently has no national standard governing those who offer financial advice. 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. [/et_pb_text][/et_pb_column] [/et_pb_row] [/et_pb_section] [previousOntario Securities Commission Publishes 2019 Burden Reduction Update](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-2019-burden-reduction-update/) [nextFINTRAC Updates Methods Used Identifying Individuals and Confirming the Existence of Corporations or Other Entities](https://baxsecuritieslaw.com/fintrac-updates-methods-used-identifying-individuals-and-confirming-the-existence-of-corporations-or-other-entities/) ### About BAX Securities Law® Corporate Securities & Financial Services Lawyers BAX Securities Law® practises in the securities and financial services regulatory areas and has acted as counsel to major Canadian and American corporations, market participants. #### Legal Services If you wish to discuss retaining BAX Securities Law® to provide you with legal services, please contact: **Barbara Hendrickson** Managing Partner **416.601.1004** [*bhendrickson@baxsecuritieslaw.com*](mailto:bhendrickson@baxsecuritieslaw.com) [Get In Touch](https://baxsecuritieslaw.com/consult/) **Categories:** FSRA, News & Updates --- ### [FSRA Statement of Business Continuity in light of COVID-19](https://baxsecuritieslaw.com/fsra-statement-of-business-continuity-in-light-of-covid-19/) **Published:** March 19, 2020 **Author:** Barbara Hendrickson **Excerpt:** On March 6, 2020 the Financial Services Regulatory Authority of Ontario (FSRA) published a press release reminding FSRA regulated entities about their business continuity plans in light of the COVID – 19 disruption. FSRA suggested that entities regulated by FSRA should self-assess what core functions... **Content:** On March 6, 2020 the Financial Services Regulatory Authority of Ontario (FSRA) published a press release reminding FSRA regulated entities about their business continuity plans in light of the COVID – 19 disruption. FSRA suggested that entities regulated by FSRA should self-assess what core functions should be prioritized during this period of disruption. FSRA also suggested that registrants contact FSRA with any any questions, comments or concerns you may have on how to respond appropriately to these circumstances. FSRA should also be informed if registrants experience, or expect to experience, disruption to any of its critical functionality. FSRA also provided guidance to credit unions and Ontario incorporated insurers who are required to hold *annual general meetings* (AGMs) in the near future. “In person AGMs will result in large public meetings contrary to current public health advice. These meetings are an important avenue for member/shareholder engagement and should be conducted virtually to respect this public health advice.” 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. **Categories:** FSRA, News & Updates --- ### [FSRA Update on Syndicated Mortgages](https://baxsecuritieslaw.com/fsra-update-on-syndicated-mortgages/) **Published:** October 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** On October 8, 2020 the Financial Services Regulatory Authority (FSRA) published a summary of their activities to update the regulation of syndicated mortgages to assess risks and build frameworks and resources to deter ‘deceptive and fraudulent financial services practices and protect consumers’ including the following:... **Content:** On October 8, 2020 the Financial Services Regulatory Authority (FSRA) published a summary of their activities to update the regulation of syndicated mortgages to assess risks and build frameworks and resources to deter ‘deceptive and fraudulent financial services practices and protect consumers’ including the following: In June 2019, FSRA passed regulations which require requiring enhanced disclosure to investors in non-qualified syndicated mortgage investments (NQSMIs), and filing with FSRA of NQSMIs when retail sales commence. Using these filings, FSRA’s dedicated team is able to identify and deter unacceptable disclosures, ideally before investments are completed. This FSRA team actively reviews NQSMI materials and, when it identifies inadequate or misleading disclosures, contacts the mortgage brokers to confirm and mitigate those risks. In November 2019, FSRA implemented its [Supervision Approach for High-risk Syndicated Mortgage Investments](https://www.fsrao.ca/industry/mortgage-brokering-sector/guidance/supervision-approach-high-risk-syndicated-mortgage-investments). This Approach focuses on the three hallmarks of high-risk NQSMIs (high loan-to-value ratio; subordination or postponement rights; conflicts of interest). Where any of these hallmarks exist, it requires a pre-contract, plain-language warning to retail investors. In May 2020, FSRA published [Interpretation Guidance](https://www.fsrao.ca/industry/mortgage-brokering-sector/guidance/mortgage-administrators-responses-market-disruptions) which aims, in part, to address mortgage administration issues observed with Fortress. It details the obligations of mortgage administrators to make disclosures and otherwise protect the interests of NQSMI investors. FSRA is working with the Ontario Securities Commission to transfer regulatory oversight of certain retail NQSMI transactions from FSRA to the OSC. The transfer is expected to come into effect on March 1, 2021. FSRA recently completed a public consultation on its proposed approach for supervising mortgage brokerages and administrators that are engaged in SMIs, and for SMI transactions that remain under FSRA’s supervision after the transfer. See: . For a copy of the update: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** FSRA, News & Updates --- ### [FSRA Enhances Protections for Investors of High-risk Offerings by Co-operative Corporations](https://baxsecuritieslaw.com/fsra-enhances-protections-for-investors-of-high-risk-offerings-by-co-operative-corporations/) **Published:** October 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** On October 5, 2020 the Financial Services Regulatory Authority of Ontario (FSRA) announced that it is developing proposed guidance - Interpretation and Approach guidance that identifies higher risk offerings and sets out enhanced disclosures by co-operative corporations (co-ops) that are raising capital. The Co-operative Corporations Act (CCA) requires... **Content:** On October 5, 2020 the Financial Services Regulatory Authority of Ontario (FSRA) announced that it is developing proposed guidance – [Interpretation and Approach guidance](https://www.fsrao.ca/industry/co-operatives-sector/high-risk-offerings-issued-under-co-operative-corporations-act) that identifies higher risk offerings and sets out enhanced disclosures by co-operative corporations (co-ops) that are raising capital. The *Co-operative Corporations Act* (CCA) requires that co-ops provide “full, true and plain disclosure” in their offering statements. This protects investors and helps them make informed investment decisions. The proposed guidance will set out specific risk factors and information that co-ops must disclose when issuing securities to comply with FSRA’s interpretation of the requirements under the CCA. This non-exhaustive list includes debt repayment details, insolvency rankings and financial obligations. Potential investors will better understand the related risks before deciding whether to purchase these securities. The proposed guidance will apply to high-risk offerings by co-ops. The proposed guidance if out for comments until November 18, 2020. For a copy of the update, [click here.](https://www.fsrao.ca/industry/co-operatives-sector/high-risk-offerings-issued-under-co-operative-corporations-act) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** FSRA, News & Updates --- ### [FSRA’s proposed 2021-22 Statement of Priorities and Budget](https://baxsecuritieslaw.com/fsras-proposed-2021-22-statement-of-priorities-and-budget/) **Published:** October 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** On October 13, 2020, Financial Services Regulatory Authority (FSRA) published its proposed 2021-22 Statement of Priorities and Budget for public consultation. FSRA is inviting the general public and all stakeholders to review and provide feedback on the proposed 2021-22 Statement of Priorities and Budget. The draft... **Content:** On October 13, 2020, Financial Services Regulatory Authority (FSRA) published its proposed 2021-22 Statement of Priorities and Budget for public consultation. FSRA is inviting the general public and all stakeholders to review and provide feedback on the [proposed 2021-22 Statement of Priorities and Budget.](https://www.fsrao.ca/media/2326/download) The draft priorities outline cross-sector and sector-specific initiatives focused on improving regulatory efficiency and effectiveness to better serve the public interest. The budget reflects FSRA’s proposed expenses, strategic investments and sources of funding, to achieve its mandate and stated priorities. The Statement of Priorities and Budget will form the core of FSRA’s Annual Business Plan to be submitted to the Minister of Finance for approval. The consultation period will close on November 3, 2020. See: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** FSRA, News & Updates --- ### [FSRA’s Proposed Approach to Strengthening Protection of Vulnerable Consumers – Request for Comment](https://baxsecuritieslaw.com/fsras-proposed-approach-to-strengthening-protection-of-vulnerable-consumers-request-for-comment/) **Published:** January 22, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Financial Services Regulatory Authority of Ontario (FSRA) has published for a 90-day comment period, ending March 8, 2024, its proposed approach to strengthen the protection of vulnerable consumers in its regulated sectors (the Proposed Approach). The Proposed Approach is based on research undertaken by... **Content:** The Financial Services Regulatory Authority of Ontario (FSRA) has published for a 90-day comment period, ending March 8, 2024, its *proposed approach to strengthen the protection of vulnerable consumers in its regulated sectors* (the Proposed Approach). The Proposed Approach is based on research undertaken by FSRA that shows vulnerable groups tend to be at greater risk of being susceptible to harms such as fraud. Consequently, these vulnerable groups less trusting, less satisfied, and less confident and experience poorer outcomes. They may also experience more issues getting products or services in certain sectors. The Proposed Approach will: - Promote inclusive and fair treatment of vulnerable consumers and preventing targeted financial mistreatment; and, - Improve consumer education, engagement, and awareness building efforts. FSRA invites interested stakeholders to submit feedback until the March 8 deadline. *The proposed approach to strengthen the protection of vulnerable consumers in its regulated sectors* is [available for download](https://www.fsrao.ca/engagement-and-consultations/consultation-fsras-proposed-approach-strengthening-protection-vulnerable-consumers/fsras-proposed-approach-strengthening-protection-vulnerable-consumers) from the website of the Financial Services Regulatory Authority of Ontario. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** FSRA, News & Updates --- ### [Webinar Invite: 2024 Federal Canadian Budget Impact on the Crypto Asset / Blockchain Industry](https://baxsecuritieslaw.com/webinar-invite-2024-federal-canadian-budget-impact-on-the-crypto-asset-blockchain-industry/) **Published:** May 16, 2024 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law webinar series on the regulation of crypto assets and the blockchain industry in Canada. Please join Barbara Hendrickson of BAX Securities Law and Jeremie Beitel of Beitel Tax Law on June 11, 2024 at 2:00 PM EST for a webinar to discuss the new tax... **Content:** BAX Securities Law webinar series on the regulation of crypto assets and the blockchain industry in Canada. Please join Barbara Hendrickson of BAX Securities Law and Jeremie Beitel of Beitel Tax Law on **June 11, 2024 at 2:00 PM EST for a webinar** to discuss the new tax reporting requirements proposed by the Canadian federal government in the April 16, 2024 budget for crypto assets. Speakers will address: - The proposed annual tax reporting requirements for crypto asset service providers implemented through the Common Reporting Standard (CRS) developed by the Organization for Economic Cooperation and Development (OECD). - The application of the annual tax reporting requirements to crypto asset service providers who facilitate transactions involving crypto assets including conversions between crypto assets and fiat currencies, the exchange of crypto assets, transfers of crypto assets generally as well as transfers of crypto assets with merchants / service providers in exchange for goods and services. - Disclosure requirements respecting “customers” of the crypto asset service providers including corporate customers. - The expansion of the CRS’s scope to include fiat-backed stable coins (Value-Referenced Crypto Assets or VRCAs) and central bank digital currencies not covered by the OECD Crypto Asset Reporting Framework. - The solicitation of comments by the Canadian federal government on the possibility of including crypto assets as “qualified investments” for registered savings plans and tax-free savings accounts. - A discussion of how the proposals will impact the operators of registered crypto trading platforms, payment processing businesses and issuers of crypto assets in Canada. If you are currently involved in crypto asset / blockchain industry in Canada please join us on June 11, 2024, at 2:00 EST. Participants will have the opportunity to ask questions during the webinar. Please RSVP to Barbara Hendrickson at . **Categories:** Crypto lawyer, News & Updates --- ### [Self-Styled “Crypto King’ Dethroned](https://baxsecuritieslaw.com/self-styled-crypto-king-dethroned/) **Published:** June 7, 2024 **Author:** Barbara Hendrickson **Excerpt:** Time may have run out for the so-called 'Crypto King', Aiden Pleterski. Pleterski has been charged with one count of fraud over $5,000 under Section 380(1)(a) of the Criminal Code, and one count of laundering proceeds of Canadian crime Under Section 462.31(1)(a) of the Criminal... **Content:** Time may have run out for the so-called ‘Crypto King’, Aiden Pleterski. Pleterski has been charged with one count of fraud over $5,000 under Section 380(1)(a) of the Criminal Code, and one count of laundering proceeds of Canadian crime Under Section 462.31(1)(a) of the Criminal Code. The charges’ details, subject to a publication ban, are the result of Project Swan, a joint investigation by the Durham Regional Police Service (DRPS) and the Ontario Securities Commission (OSC). According to [previously published media reports](https://www.thestar.com/news/canada/how-crypto-king-aiden-pleterski-faked-an-extravagant-life-using-scene-points-and-virtual-goods/article_9691c526-1d1a-11ef-a612-9bcdb014a29a.html), Pleterski allegedly defrauded investors of $40 million. Pleterski is also the subject of an ongoing bankruptcy action in civil court. According to [documents posted online by bankruptcy trustee Grant Thorton](https://docs.grantthornton.ca/document-folder/viewer/docul8LWsxcWho7J/6131154647209229184), Pleterski has not complied with the terms of the bankruptcy, including providing a complete record of his business transactions and may be hiding assets. None of the allegations have been proven in court. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Crypto lawyer, News & Updates --- ### [CSA And CIRO Expect Crypto Trading Platforms To Prioritize Applications For Investment Dealer Registration And CIRO Membership](https://baxsecuritieslaw.com/csa-and-ciro-expect-crypto-trading-platforms-to-prioritize-applications-for-investment-dealer-registration-and-ciro-membership/) **Published:** August 12, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) are reminding crypto trading platforms (CTPs) to ensure their operations comply with Canadian securities laws by prioritizing their applications for registration as investment dealers and membership with CIRO. Under the terms of Staff... **Content:** The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) are reminding crypto trading platforms (CTPs) to ensure their operations comply with Canadian securities laws by prioritizing their applications for registration as investment dealers and membership with CIRO. Under the terms of Staff Notice 21-329 *Guidance for Crypto-Asset Trading Platforms: Compliance with Regulatory Requirements* (the Staff Notice), which was published in March 2021, CTPs that trade in either: a) crypto assets that are securities or derivatives, or b) instruments or contracts, based on crypto assets, that are securities or derivatives, are expected to register as investment dealers and become members of CIRO, the regulatory body intended to oversee this type of activity. As outlined in the Staff Notice, CSA Staff contemplated an interim approach, which allowed CTPs to operate as restricted dealers in an appropriately regulated environment for a two-year period while working toward obtaining CIRO membership (the Interim Approach). During this time, CTPs were expected to seek registration as investment dealers and membership with CIRO. Given that the two-year period has passed, CSA Staff expect CTPs by this time to have carefully reviewed and understood the requirements to become investment dealers and CIRO members and be actively engaged with CIRO on their applications. As CSA Staff warn they do not intend to continue the Interim Approach as described in the Staff Notice, they advise that CTPs which have been working towards registration and CIRO membership should contact the CSA member in their participating jurisdiction to discuss appropriate next steps. Staff Notice 21-329 *Guidance for Crypto-Asset Trading Platforms: Compliance with Regulatory Requirements* (the Staff Notice) [ is available for download](//www.osc.ca/en/securities-law/instruments-rules-policies/2/21-329/joint-canadian-securities-administratorsinvestment-industry-regulatory-organization-canada-staff) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Crypto lawyer, News & Updates --- ### [SEC Announces Formation of New Crypto Asset Task Force](https://baxsecuritieslaw.com/sec-announces-formation-of-new-crypto-asset-task-force/) **Published:** January 27, 2025 **Author:** Barbara Hendrickson **Excerpt:** The U.S. Securities and Exchange Commission (SEC) published a press release on January 21, 2025 (“Press Release”) stating that it has launched a task force dedicated to developing a regulatory framework for crypto assets (“Task Force”). SEC Commissioner Hester Peirce will lead the task force.... **Content:** The U.S. Securities and Exchange Commission (SEC) published a press release on January 21, 2025 (“Press Release”) stating that it has launched a task force dedicated to developing a regulatory framework for crypto assets (“Task Force”). SEC Commissioner Hester Peirce will lead the task force. According to the Press Release, “Drawing from talented staff across the agency, the Task Force will collaborate with Commission staff and the public to set the SEC on a sensible regulatory path that respects the bounds of the law. To date, the SEC has relied primarily on enforcement actions to regulate crypto retroactively and reactively, often adopting novel and untested legal interpretations along the way. Clarity regarding who must register, and practical solutions for those seeking to register, have been elusive. The result has been confusion about what is legal, which creates an environment hostile to innovation and conducive to fraud. The SEC can do better. The Task Force’s focus will be to help the Commission draw clear regulatory lines, provide realistic paths to registration, craft sensible disclosure frameworks, and deploy enforcement resources judiciously. The Task Force will operate within the statutory framework provided by Congress and will coordinate the provision of technical assistance to Congress as it makes changes to that framework. The Task Force will coordinate with federal departments and agencies, including the Commodity Futures Trading Commission, and state and international counterparts.” Please see the Press Release at: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Crypto lawyer, News & Updates --- ### [FINTRAC Issues Record CAD $176 Million Penalty To Xeltox/Cryptomus](https://baxsecuritieslaw.com/fintrac-issues-record-cad-176-million-penalty-to-xeltox-cryptomus/) **Published:** October 24, 2025 **Author:** Barbara Hendrickson **Content:** The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has issued a record CAD $176,960,190 administrative monetary penalty on Xeltox Enterprises Ltd. of Vancouver, a reporting entity providing virtual currency transaction service (also operating as also operating under the name Cryptomus and previously known as Certa Payments Ltd). The $176 million penalty levied against Xeltox is for the 2,593 instances across six types of violations where Xeltox contravened under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLFTA) and associated regulations, each causing severe harm and demonstrating significant, widespread non-compliance with regulatory requirements and subject to a penalty. The violations include: - Failure, on 1,068 separate occasions, to submit suspicious transaction reports for transactions involving known darknet markets and virtual currency wallets linked to criminal activity, such as trafficking in child sexual abuse material, movement of fraud proceeds, laundering of ransomware payments, and financial flows with reasonable grounds to suspect they were related to sanctions evasion; - Failure to comply with a Ministerial Directive, as demonstrated in connection to financial transactions associated with the Islamic Republic of Iran; - Failure to develop and apply written compliance policies and procedures that are kept up to date and, in the case of an entity, are approved by a senior officer; - Failure to assess and document the risk of a money laundering offence or a terrorist activity financing offence related to its activities, taking into consideration the prescribed factors; - Failure to submit, on four separate occasions, a notification of a change to the information provided in a prescribed application in the prescribed manner and with the prescribed information; and, - Failure to report, on 1,518 separate occasions, the receipt from a client of an amount in virtual currency of $10,000 or more during a single transaction, together with the prescribed information. The public notice *Administrative monetary penalty on Xeltox Enterprises Ltd*. [ is available for download](https://fintrac-canafe.canada.ca/new-neuf/nr/2025-10-22-eng) from FINTRAC’s website. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Crypto lawyer, Financial --- ### [CSA Cautions Crypto Lending Platforms And Customers](https://baxsecuritieslaw.com/csa-cautions-crypto-lending-platforms-and-customers/) **Published:** October 24, 2025 **Author:** Barbara Hendrickson **Content:** In the wake of the recent record CAD $176,960,190 administrative monetary penalty levied by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) on Xeltox Enterprises Ltd. of Vancouver (also known as Cryptomus ), the Canadian Securities Administrators (CSA) have issued a caution to crypto-backed lending platforms and regarding their obligations under securities law, encouraging them to comply with regulatory requirements. In addition, the regulator reminded members of the public to confirm the regulatory status of the platforms they seek to do business with. The CSA has granted exemptive relief to crypto-backed lending platforms which offer loans backed by crypto assets, tailored to the platform’s specific business model, and includes conditions intended to address investor protection. Crypto-backed loans typically involve the investor (or borrower) transferring their crypto assets to the platform (or lender) as collateral in an amount that exceeds the value of the loan. Depending on the circumstances, crypto-backed lending platforms may be engaged in securities trading and distribution with clients, which may require registration and the filing of a prospectus. The regulator warns that platforms that are not registered with, or have not obtained exemptive relief from, securities regulators may present significant risks to investors, such as a lack of internal controls to safeguard collateral, or inadequate or inappropriate disclosure regarding terms of the loan. The regulator advises the public before engaging with a crypto-backed lending platform as either an investor or a customer to verify whether the platform is registered with a Canadian securities regulator or is operating under exemptive relief from securities legislation requirements. A list of those crypto-backed lending platforms that have obtained exemptive relief [is available on the website](https://www.securities-administrators.ca/crypto-platforms-regulation-and-enforcement-actions/crypto-platforms-authorized-to-do-business-with-canadians/) of the Canadian Securities Administrators. The CSA encourages platforms currently offering, or planning to offer, loans collateralized by crypto assets to contact the appropriate securities regulator (if they haven’t already done so. The regulator also warns that platforms who do not engage with regulators risk contravening securities laws and may be subject to regulatory action. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Crypto lawyer, Financial --- ### [SEC Chair Outlines “Project Crypto” in Speech](https://baxsecuritieslaw.com/sec-chair-outlines-project-crypto-in-speech/) **Published:** December 4, 2025 **Author:** Barbara Hendrickson **Content:** In a recent speech to the Federal Reserve Bank of Philadelphia, U.S. Securities and Exchange Commission (SEC) chair Paul S. Atkins discussed the SEC’s approach to digital assets, which has been termed “Project Crypto.” “At its core,” said Atkins, “it is about basic fairness and common sense as it relates to the application of the federal securities laws to crypto assets and related transactions.” Central to Project Crypto is the establishment of what Atkins has called a “clear token taxonomy,” based in the longstanding Howey investment contract securities analysis. As applied, the Howey Test as outlined in *SEC v. W.J. Howey Co. (1946),* uses the presence of an investment contract to determine if tokens are securities. “I believe that most crypto tokens trading today are not securities,” he said. Atkins did allow, however, that a token as part of an investment contract “might have been sold.” Atkins reaffirmed his view that while digital collectables are not securities, “tokenized securities are and will continue to be securities.” Digital collectables perform a function, he said, such as serving as a ticket, membership credential or identity badge, but their owners do not expect to profit from the actions of their managers. However, he said, tokenized assets “represent the ownership of a financial instrument enumerated in the definition of “security” that is maintained on a crypto network.” “A stock is still a stock whether it is a paper certificate, an entry in a DTCC account, or represented by a token on a public blockchain,” said Atkins. “A bond does not stop being a bond because its payment streams are tracked using smart contracts. Securities, however represented, remain securities.” “Just because something is called a ‘token’ or an ‘NFT’ does not exempt it from securities law he said. Atkins also cautioned that because a token was once part of a capital-raising transaction, it is not “magically converted” into stock of an operating company. “Economic reality trumps labels.” Atkins called the principles he discussed “hardly novel,” noting they are rooted in United States Supreme Court decisions that direct the regulator to consider the substance of a transaction, rather than its form, when considering if securities laws apply. While Atkins expects that the regulator will consider a series of exemptions to create “a tailored offering regime for crypto assets” connected to investment contracts, he also advises that the SEC will continue to protect investors from securities fraud. “If you raise money by promising to build a network, and then take the proceeds and disappear, you will be hearing from us, and we will pursue you to the full extent of the law… fraud is fraud.” *The SEC’s Approach to Digital Assets: Inside “Project Crypto”*[ is available for download](https://www.sec.gov/newsroom/speeches-statements/atkins-111225-secs-approach-digital-assets-inside-project-crypto) from the website of the Securities and Exchange Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Crypto lawyer, Financial --- ### [BAX Securities Law voted a Top 10 Canadian Corporate Boutique Law Firm for 2020-2021](https://baxsecuritieslaw.com/bax-securities-law-voted-a-top-10-canadian-corporate-boutique-law-firm-for-2020-2021/) **Published:** October 15, 2020 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law (BAX) is pleased to announce that for the third time it has been ranked as one of the Top 10 Corporate Boutique law firms in Canada by Canadian Lawyer. It also received this prestigious ranking for 2016-2017 and 2018-2019. Canadian Lawyer selected Canada’s top... **Content:** BAX Securities Law (BAX) is pleased to announce that for the third time it has been ranked as one of the Top 10 Corporate Boutique law firms in Canada by [Canadian Lawyer](https://www.canadianlawyermag.com/author/aidan-macnab/client-centred-growth-top-ten-corporate-boutiques-16123/?utm_term=Client-centred%20growth:%20Top%20Corporate%20Boutiques&utm_campaign=CLNewswire_20180904&utm_content=email&utm_source=Act-On+Software&utm_medium=email). It also received this prestigious ranking for 2016-2017 and 2018-2019. *Canadian Lawyer* selected Canada’s top corporate law boutiques by asking readers to rank a long list of notable firms. Based on a voting process and input by industry peers, lawyers and clients, BAX was chosen and is among the group of boutique firms most highly rated. As one of the top 10 corporate boutique firms BAX Securities Law is confident of its ability to match Big Law’s expertise. “I’m very proud and honored to have our firm selected, for the third time, to be part of this impressive group of Top 10 Boutique Law firms in Canada,” says Barbara Hendrickson, who founded BAX in 2013. “This ranking survey is further validation that our law firm continues to be recognized for its expertise, caliber of work and ability to execute for our valued clients and business partners.” **About BAX Securities Law** BAX Securities Law has a national and cross-border focus and offers corporate and securities advice to its clients operating in a number of areas including the fintech industry (including cryptocurrency), investment funds, real estate syndication and commodities (carbon, energy, and minerals) sectors. It specializes in online offering platforms including crowdfunding and peer-to-peer lending, and acts for public companies, venture capitalists, private equity firms and securities registrants including exempt market dealers. Barbara Hendrickson is the founder and managing partner of BAX and a senior securities lawyer with more than 20 years experience including with the Ontario Securities Commission, a leading Canadian national law firm, and one of the world’s largest international law firms. See: For additional info please visit: lawfirmbarbara.wpengine.com or Contact: Barbara Hendrickson: E: P: 416.601.1004 M: 647.403.4606 **Categories:** Corporate securities lawyer, News & Updates --- ### [Canadian Securities Administrators Publish for Comment CSA Staff Notice 21-323 Proposal for Mandatory Post-Trade Transparency of Trades in Government Debt Securities, Expanded Transparency of Trades in Corporate Debt Securities and Proposed Amendments to National Instrument 21-101](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-for-comment-csa-staff-notice-21-323-proposal-for-mandatory-post-trade-transparency-of-trades-in-government-debt-securities-expanded-transparency-of-trades-i/) **Published:** May 29, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) last Thursday published for comment CSA Staff Notice 21-323 Proposal for Mandatory Post-Trade Transparency of Trades in Government Debt Securities, Expanded Transparency of Trades in Corporate Debt Securities and Proposed Amendments to National Instrument 21-101(the Proposed Amendments). The comment period... **Content:** The Canadian Securities Administrators (CSA) last Thursday published for comment *CSA Staff Notice 21-323 Proposal for Mandatory Post-Trade Transparency of Trades in Government Debt Securities, Expanded Transparency of Trades in Corporate Debt Securities and Proposed Amendments to National Instrument 21-101*(the Proposed Amendments)*.* The comment period will end on August 29, 2018. If approved, the Proposed Amendments would introduce mandatory post-trade transparency requirements for government debt securities (Proposed Government Debt Framework) and expand transparency requirements for corporate debt securities (Expanded Corporate Debt Proposal). These amendments would also align the post-trade transparency regimes for government and corporate debt securities. The Proposed Government Debt Framework, which would be established by the Proposed Amendments, was developed by the CSA with the assistance of a stakeholder group that included the Bank of Canada, the Department of Finance Canada, and the Investment Industry Regulatory Organization of Canada (IIROC). The Framework would see an Information Processor (IP) established for government debt securities and would set the requirements. The Proposed Amendments would require a person or company that executes trades in government debt securities to provide information regarding these trades to the IP. Under the proposal, dealers, interdealer bond brokers (IDBBs), marketplaces and Schedule I, II, and III banks would be required to report details of their government debt transactions to the IP. In parallel, the Expanded Corporate Debt Proposal would extend the existing corporate debt transparency provisions to require a person or company that executes transactions in corporate debt securities to provide information regarding trades in these securities to an IP. This means that mandatory post-trade transparency of trades in corporate debt securities would apply to entities beyond dealers, marketplaces and IDBBs and would extend to Schedule I, II, and III banks. The CSA is proposing that IIROC’s mandate as IP for corporate debt securities would be expanded to include government debt securities. CSA staff would continue to conduct oversight activities to ensure that IIROC complies with the requirements in NI 21-101 and the terms and conditions set by the regulatory authorities in each jurisdiction. *CSA Staff Notice and Request for Comment 21-323 Proposal for Mandatory Post-Trade Transparency of Trades in Government Debt Securities, Expanded Transparency of Trades in Corporate Debt Securities and Proposed Amendments to National Instrument 21-101 Marketplace Operation and Related Companion Policy* [available for download](https://www.bcsc.bc.ca/21-323_%5bCSA_Staff_Notice_and_Request_for_Comment%5d_05242018/) from the websites of participating jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** Corporate securities lawyer, News & Updates --- ### [Cast Your Vote for BAX Securities Law as Top Corporate Law Boutique](https://baxsecuritieslaw.com/cast-your-vote-for-bax-securities-law-as-top-corporate-law-boutique/) **Published:** September 22, 2025 **Author:** Barbara Hendrickson **Content:** *Canadian Lawyer* has launched the biannual [Top Corporate Law Boutiques](https://www.research.net/r/GCKJPR7) to spotlight the firms that have demonstrated excellence in client service, innovation, and legal expertise. BAX Securities Law was fortunate enough to have received this designation several times in the past (2016-2021). BAX securities law is pleased to announced that it is on Canadian Lawyer’s short list for Top Corporate Law firms in Canada and we respectfully ask that you consider voting for us this year. Lawyers can [cast their votes](https://www.research.net/r/GCKJPR7) for at least five firms they believe deserve recognition by Friday, October 10. Please make BAX Securities Law one of the firms. **About BAX Securities Law** BAX Securities Law has a national and cross-border focus and offers corporate and securities advice to its clients operating in a number of areas including the fintech (including cryptocurrency), investment funds, real estate syndication, commodities, digital assets and securities regulatory and enforcement. Our focus is online offering platforms including crowdfunding and peer-to-peer lending, and we act for public companies, venture capitalists, private equity firms and securities registrants including exempt market dealers. Barbara Hendrickson is the founder and managing partner of BAX and a senior securities lawyer with more than 25 years experience including with the Ontario Securities Commission, a leading Canadian national law firm, and one of the world’s largest international law firms. Please contact Barbara Hendrickson at BAX Securities Law (647) 403-4606 or email her at for more information. **Categories:** Corporate securities lawyer, News & Updates --- ### [Canadian Lawyer names BAX Securities Law as one of the Top 10 Canadian Corporate Boutique Law Firms (May 2, 2016)](https://baxsecuritieslaw.com/201652canadian-lawyer-names-bax-securities-law-as-one-of-the-top-10-canadian-corporate-boutique-law-firms-may-2-2016/) **Published:** May 2, 2016 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law (BAX) is pleased to announce it has been ranked as one of the Top 10 Corporate Boutique law firms in Canada by Canadian Lawyer, a Thomson Reuter’s publication.Canadian Lawyer selected Canada’s top litigation and corporate law boutiques by asking readers to rank... **Content:** ![](http://static1.squarespace.com/static/538ccb7ee4b0c9bb1896333b/538ccc06e4b021ab8ae2b852/572ce5584c2f859172d81481/1462560105548//img.png) BAX Securities Law (BAX) is pleased to announce it has been ranked as one of the Top 10 Corporate Boutique law firms in Canada by Canadian Lawyer, a Thomson Reuter’s publication. Canadian Lawyer selected Canada’s top litigation and corporate law boutiques by asking readers to rank a long list of notable firms. Based on a voting process and input by industry peers, lawyers and clients, BAX was shortlisted and was among the group of boutique firms most highly rated. The top 10 boutique firms in this category were all equally confident of their ability to match Big Law’s strength and expertise.”I’m very proud and honored to have our firm selected to be part of this impressive group of Top 10 Boutique Law firms in Canada”, says Barbara Hendrickson, founder of BAX. “This ranking survey is further validation that our firm continues to be recognized for its expertise, caliber of work and ability to execute for our valued clients and business partners.” For the detailed results of the survey and for further information, please check out the full article in the May edition of Canadian Lawyer. **Categories:** Corporate lawyer, News & Updates --- ### [BAX Securities Law featured in Canadian Lawyer’s “Practical advice: Top 10 Corporate Boutiques”](https://baxsecuritieslaw.com/bax-securities-law-featured-in-canadian-lawyers-practical-advice-top-10-corporate-boutiques/) **Published:** December 14, 2021 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law has been named as a Top 10 Corporate Boutiques in Canada. BAX and its founder, Barbara Hendrickson, were recently featured in a Canadian Lawyer magazine article. The article discusses the “cost-effective, business oriented service” of leading Canadian law firms such as BAX... **Content:** BAX Securities Law has been named as a Top 10 Corporate Boutiques in Canada. BAX and its founder, Barbara Hendrickson, were recently featured in a Canadian Lawyer magazine article. The article discusses the “cost-effective, business oriented service” of leading Canadian law firms such as BAX focusing on the increased demand during the COVID pandemic for “personalized service, attention to detail and competitive pricing”. According to an article published earlier this month: “Corporate law boutiques are in high demand in today’s evolving marketplace, as businesses of all sizes and industries seek expertise for their unique business needs. Uncertainty driven by the pandemic has given rise to significant merger and acquisition activity, strategic investments and financing transactions, creating a heightened demand for experts to handle these complex transactions, as well as day-to-day corporate matters. Many organizations turn to corporate boutiques for their personalized service, attention to detail and competitive pricing.” The article is now online: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Corporate lawyer, Corporate securities lawyer, News & Updates --- ### [Barbara Hendrickson speaks at the Toronto Lawyers Association "TLA - True or False: Corporate Lawyers need to be Securities” Lawyers, June 1, 2017](https://baxsecuritieslaw.com/barbara-hendrickson-speaks-toronto-lawyers-association-tla-true-false-corporate-lawyers-need-securities-lawyers-june-1-2017/) **Published:** June 5, 2017 **Author:** Barbara Hendrickson **Excerpt:** Please click here for Barbara’s full presentation **Content:** Please click here for **[Barbara’s full presentation](https://drive.google.com/file/d/0B9CbHYh7pSneRnZ1clNxWl9JdDg/view?usp=sharing)** **Categories:** Corporate lawyer, News & Updates --- ### [OSC Announces Businesses Selected for New Capital Markets Testing Environment](https://baxsecuritieslaw.com/osc-announces-businesses-selected-for-new-capital-markets-testing-environment/) **Published:** May 25, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) recently announced that seven businesses that will be part of its new  capital markets testing environment, OSC TestLab. This initiative allows businesses to test solutions that can help Ontario registrants and contribute to better investor outcomes. Seven selected businesses will... **Content:** The Ontario Securities Commission (OSC) recently announced that seven businesses that will be part of its new capital markets testing environment, OSC TestLab. This initiative allows businesses to test solutions that can help Ontario registrants and contribute to better investor outcomes. Seven selected businesses will test solutions that include product comparison, client onboarding, portfolio analytics and assessment tools that leverage behavioural science, artificial intelligence and automation, among other approaches. These are: - Broadridge Investor Communications Corporation - LockDocs Inc. - Mako Fintech - Morningstar Research Inc. - Syntoniq, Inc. - TMX Group - Wealthscope The participating firms will begin testing later this spring with testing expected to conclude in fall 2022. OSC TestLab invites businesses to experiment with innovative solutions in Ontario’s capital markets as part of focused, group testing. Testing will provide opportunities for participants to learn through experimentation and gather feedback that can help to fine-tune and tailor solutions. At the same time, insights from testing can provide valuable input to inform the OSC’s efforts to modernize Ontario’s regulatory environment. For more details about the tests, including how to participate as a registrant or investor, is available at [oscinnovation.ca/TestLab/spring2022](https://osc.us1.list-manage.com/track/click?u=ac134df018103367c73e6fced&id=ddc91e198c&e=8954589ef9). 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. **Categories:** Capital markets lawyer, News & Updates --- ### [Canadian Securities Administrators and Canadian Investment Regulatory Organization Publish CSA/CIRO Staff Notice 23-331 Request for Feedback on December 2022 SEC Market Structure Proposals and Potential Impact on Canadian Capital Markets](https://baxsecuritieslaw.com/canadian-securities-administrators-and-canadian-investment-regulatory-organization-publish-csa-ciro-staff-notice-23-331-request-for-feedback-on-december-2022-sec-market-structure-proposals-and-potenti/) **Published:** October 30, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have jointly published CSA/CIRO Staff Notice 23-331 Request for Feedback on December 2022 SEC Market Structure Proposals and Potential Impact on Canadian Capital Markets (The Staff Notice) for a 90-day comment period ending December, 4th... **Content:** The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have jointly published *CSA/CIRO Staff Notice 23-331 Request for Feedback on December 2022 SEC Market Structure Proposals and Potential Impact on Canadian Capital Markets* (The Staff Notice) for a 90-day comment period ending December, 4th 2023. On December 14th 2022, the United States Securities and Exchange Commission (SEC) published for comment four proposals to significantly change certain fundamental elements of the U.S. market structure (the SEC Proposed Amendments). The comment period closed on March 31st 2023. The CSA and the CIRO are reviewing the SEC’s Proposed Amendments. They are considering their impact on the structure of the Canadian equity markets should the SEC adopt any or all of them in any form. The regulators are publishing this notice to solicit views and to seek comment on certain aspects of the SEC Proposed Amendments, with a focus on the potential impacts on Canadian capital markets, including, to the extent it can be estimated, compliance costs and the potential policy responses. Neither the CSA nor CIRO is proposing any changes to the regulatory framework in Canada at this time. Any proposed changes resulting from this consultation will be published for comment in the normal course. Both regulators welcome input from interested stakeholders up to the December 4th deadline. *CSA/CIRO Staff Notice 23-331 Request for Feedback on December 2022 SEC Market Structure Proposals and Potential Impact on Canadian Capital Markets* [is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/2/23-331/csaciro-staff-notice-23-331-request-feedback-december-2022-sec-market-structure-proposals-and) from the websites of member jurisdictions of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Capital markets lawyer, News & Updates --- ### [CIRO Publishes Proposed Consolidation Rules for Comment](https://baxsecuritieslaw.com/ciro-publishes-proposed-consolidation-rules-for-comment/) **Published:** February 18, 2026 **Author:** Barbara Hendrickson **Content:** The Canadian Investment Regulatory Organization (CIRO) is republishing for further comment the complete proposed consolidated rules (Proposed CIRO Rules) for a period ending June 12, 2026. The Proposed CIRO Rules will bring together the two member regulation rule sets currently applicable to Investment Dealers and to Mutual Fund Dealers into one set of member regulation rules applicable to both categories of CIRO Dealer Members. Note that these consolidated rules, referred to as CIRO Dealer and Consolidated (DC) Rules in previous publications, will instead be titled the CIRO Rules. The objectives of the Proposed CIRO Rules are to: - adopt harmonized rules to: - minimize regulatory arbitrage between Investment Dealer Members and Mutual Fund Dealer Members; - ensure like dealer activities will be regulated in a like manner; - where practical and appropriate, adopt less prescriptive, more principles-based rule requirements to facilitate rules that are scalable and proportionate to the different types and sizes of Dealer Members and their respective business models, and; - improve clarity of the rules applicable to all CIRO Dealer Members, which will be known as the CIRO Rules. The Proposed CIRO Rules combine the proposals previously published in Phases 1 through 5 of the Rule Consolidation Project alongside further proposed amendments to: - address comments received, - in some instances, make material changes to the proposed rule requirements published in previous phases, and; - make non-material changes in formatting and grammar to provide clarity. A copy of the CIRO Bulletin, including the text of the complete Proposed CIRO Rules[ is available for download](https://www.osc.ca/sites/default/files/2026-02/ciro_202602212_rules-bulletin.pdf) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Business lawyer, Capital markets lawyer, Financial, Governments --- ### [Barbara Hendrickson re-appointed to BCSC Fintech Advisory Forum](https://baxsecuritieslaw.com/barbara-hendrickson-re-appointed-to-bcsc-fintech-advisory-forum/) **Published:** March 4, 2026 **Author:** Barbara Hendrickson **Content:** Barbara Hendrickson, founder and Managing Partner of BAX Securities Law, has been reappointed to a third two-year term as member of the British Columbia Securities Commission (BCSC) Fintech Advisory Forum. The BCSC Fintech Advisory Forum serves as a platform for discussing innovations in financial technology and the regulatory considerations. Composed of professionals and experts from across the fintech industry, the forum provides strategic advice to BCSC staff on emerging trends, opportunities, and risks in the fintech landscape. In addition to offering insights on fintech developments, the forum contributes valuable input on issues affecting the securities industry and related securities law matters.Members serve two-year terms. Selection is based on demonstrated expertise in current and emerging areas of fintech, knowledge of British Columbia’s capital markets, strong technological acumen, and an understanding of the challenges faced by fintech companies. More information about the BCSC Fintech Advisory Forum [can be found on the website](https://www.bcsc.bc.ca/industry/financial-technology-innovation/bcsc-fintech-advisory-forum) of the British Columbia Securities Commission. 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. **Categories:** Business Law, Financial, Governments --- ### [BAX Securities Law Announces April Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-april-toronto-business-lawyers-association-monthly-meeting-2/) **Published:** April 1, 2026 **Author:** Barbara Hendrickson **Content:** BAX Securities Law is pleased to invite friends and colleagues to the next meeting on **Thursday, April 16, 2026**, at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson, founder of BAX Securities Law, over eleven years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together for business and professional development purposes. The TBLA meetings are held once a month at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. If you would like to attend this month’s meeting, please RSVP to Barbara Hendrickson at . For more information on the TBLA and its events please contact Barbara at . **Categories:** Business Law, News & Updates, Securities lawyer --- ### [BAX Securities Law’s Barbara Hendrickson speaker at Ukraine Bar Association Conference](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-speaker-a-ukraine-bar-association-conference/) **Published:** March 4, 2026 **Author:** Barbara Hendrickson **Content:** Barbara Hendrickson, founder and Managing Partner of BAX Securities Law, was a guest speaker at the III Annual International Scientific and Practical Conference “Social Justice and the Digital Economy 2026: Tokenisation,” discussing the legal regulation of securitisation and tokenisation in Canada. The conference, hosted by the Ukrainian National Bar Association, the National Academy of Sciences of Ukraine, Ukrainian Modern Digital Science (UMDS), and TRWA (UK) was streamed globally on February 26, 2026, discussed a key trend shaping contemporary law and economics — the tokenisation of real-economy assets, as Ukraine looks forward to its post-war economic recovery. For a copy of Barbara’s presentation entitled the *Regulation of Crypto Assets in Canada* [please see attached.](https://baxsecuritieslaw.com/wp-content/uploads/2026/03/Crypto-Regulation-in-Canada-March-1_BH_final.pptx) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial --- ### [Quebec Securities Regulator Publishes Artificial Intelligence Guidelines For Comment And Review](https://baxsecuritieslaw.com/quebec-securities-regulator-publishes-artificial-intelligence-guidelines-for-comment-and-review/) **Published:** September 10, 2025 **Author:** Barbara Hendrickson **Content:** The Autorité des marchés financiers (AMF) has published *Bulletin of the Financial Markets Authority 5.2 Guideline for the Use of Artificial Intelligence* (the Guidelines) for comment and review for a period ending November 7 2025. Through the Guidelines, the AMF is setting its expectations for the use of artificial intelligence in the financial services sector in Quebec. It lays down the Regulator’s expectations for Artificial Intelligence (AI) regarding risk management, governance, and business practices and specifies the measures that a financial institution should take to manage the risks associated with the use of AI in a holistic manner and to ensure the fair treatment of customers. The Guidelines applies to licensed insurers, financial services cooperatives, licensed trust companies, and other licensed deposit-taking institutions. The AMF has based the Guidelines on recognized international principles of governance and risk management and on the Organisation for Economic Co-operation and Development (OECD) Principles on AI. *Bulletin of the Financial Markets Authority 5.2 Guideline for the Use of Artificial Intelligence* [ is available for download in English](https://lautorite.qc.ca/fileadmin/lautorite/consultations/lignes-directrices/2025-11-07-fin/2025juillet03-ld-IA-an.pdf) from the website of the Autorité des marchés financiers. *Bulletin de l’Autorité des marchés financiers 5.2 Réglementation et lignes directrices* [is available for download in French](https://lautorite.qc.ca/fileadmin/lautorite/bulletin/2025/vol22no12/vol22no12_5-2.pdf) from the website of the Autorité des marchés financiers. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [2026 Best Law Firms in Canada Guide: BAX Securities Law Stands Out](https://baxsecuritieslaw.com/2026-best-law-firms-in-canada-guide-bax-securities-law-stands-out/) **Published:** November 7, 2025 **Author:** Barbara Hendrickson **Content:** ![Best Lawyers 2026 Barbara Hendrickson](https://baxsecuritieslaw.com/wp-content/uploads/2025/09/Best-Lawyers-Lawyer-Logo-2026.png) In the second edition of the *Best Law Firms in Canada Guide*, BAX Securities Law once again has been named one of Canada’s premier law firms. The recognition highlights the breadth of our expertise and our emphasis on client service, which deliver business-focused solutions in a boutique firm setting. The Best Lawyers™ firm ranking is internationally known as a comprehensive guide for businesses and individuals seeking top-tier legal counsel in Canada “We are honoured to be included in this list of highly regarded Canadian law firms which reflects our efforts over the last 13 years to provide big law firm expertise and service in a boutique law firm setting,” said Barbara Hendrickson. BAX Securities Law continues to set a national benchmark for its excellence, reinforcing its reputation as a trusted advisor on complex, high-stakes transactions in a small firm setting. Barbara Hendrickson, the founder of BAX Securities Law, was recently named as one of Canada’s Best Lawyer in the 2026 edition of Best Lawyers in Canada. **About BAX Securities Law** BAX Securities Law is a Toronto based securities law firm focused on serving clients across Canada. Combining high-quality legal expertise with the flexibility of a small firm environment ensures that their clients receive pragmatic, flexible, strategic and affordable legal services. For more information on BAX Securities Law and its services, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606 or email her at bhendrickson@baxsecuritieslaw.com **Categories:** News & Updates --- ### [BAX Securities Law Announces March Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-march-toronto-business-lawyers-association-monthly-meeting-2/) **Published:** February 25, 2026 **Author:** Barbara Hendrickson **Content:** BAX Securities Law is pleased to invite friends and colleagues to the next meeting on **Thursday, March, 19, 2026**, at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson, founder of BAX Securities Law, over eleven years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together for business and professional development purposes. The TBLA meetings are held once a month at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. If you would like to attend this month’s meeting, please RSVP to Barbara Hendrickson at . For more information on the TBLA and its events please contact Barbara at . **Categories:** Marketing & Business Development, News & Updates --- ### [BAX Securities Law Announces February Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-february-toronto-business-lawyers-association-monthly-meeting-2/) **Published:** February 5, 2026 **Author:** Barbara Hendrickson **Content:** Toronto, February 3, 2026: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday, February 19, 2026, at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson, founder of BAX Securities Law, over eleven years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together for business and professional development purposes. The TBLA meetings are held once a month at 9:30 am at Chefs Hall, 111 Richmond St. W. in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. If you would like to attend this month’s meeting, please RSVP below. For more information on the TBLA and its events please contact Barbara at[ ](mailto:bhendrickson@baxsecuritieslaw.com). **Business Lawyers Association Monthly Meeting** **LOCATION** Chefs Hall – 111 Richmond St. W., Toronto (Lost Coffee area) **DATE AND TIME** 02/19/26 9:30am – 02/19/26 10:00am US/Eastern Business Lawyers Association February 19th Meeting **RSVP BELOW:** **[I’ll BE THERE!](https://lp.constantcontactpages.com/forms/response?id=aNasrVGSxqLkOtVIgc4Wt8CIZJ7NvWjELOljnCtKgRnLfAo0fc1fd48R80p4TLlwRnsn9hEZtrB5wFwpHXRk0SQkrrNBlHffxCVD4FoiZEgWLTkxyFTcuKKG54Qj9hWDGqbea-viVA_84hXnfhQjtb9mnFPk3JxwHNt7uRVPlQHL20ssJbI4sFeM_x6JieVguzWk_BooTyXFYMefTsr-aw&encVer=1&c=p65I34SBpQVx6BAqAGIVf7RpeWGdZxDQ1FzrTI_s7h_NnD6zGww2FQ==&ch=XLyDKCHZBBZHmkDOq3j9u9NMqcrhCFfWl4SlDV31MJRXCggmXXUn7g==&source_id=8b8a69eb-69b8-42d2-962c-093bde3e67b4&source_type=em&c=p65I34SBpQVx6BAqAGIVf7RpeWGdZxDQ1FzrTI_s7h_NnD6zGww2FQ==)** **[MAYBE](https://lp.constantcontactpages.com/forms/response?id=aNasrVGSxqLkOtVIgc4Wt8CIZJ7NvWjELOljnCtKgRnLfAo0fc1fd48R80p4TLlwRnsn9hEZtrB5wFwpHXRk0SQkrrNBlHffxCVD4FoiZEgWLTkxyFTcuKKG54Qj9hWDGqbea-viVA_84hXnfhQjtb9mnFPk3JxwHNt7uRVPlQHL20ssJbI4sFeM_x6JieVguzWk_BooTyXXN6S9LkQxSg&encVer=1&c=p65I34SBpQVx6BAqAGIVf7RpeWGdZxDQ1FzrTI_s7h_NnD6zGww2FQ==&ch=XLyDKCHZBBZHmkDOq3j9u9NMqcrhCFfWl4SlDV31MJRXCggmXXUn7g==&source_id=8b8a69eb-69b8-42d2-962c-093bde3e67b4&source_type=em&c=p65I34SBpQVx6BAqAGIVf7RpeWGdZxDQ1FzrTI_s7h_NnD6zGww2FQ==)** **[I CAN’T MAKE IT](https://lp.constantcontactpages.com/forms/response?id=aNasrVGSxqLkOtVIgc4Wt8CIZJ7NvWjELOljnCtKgRnLfAo0fc1fd48R80p4TLlwRnsn9hEZtrB5wFwpHXRk0SQkrrNBlHffxCVD4FoiZEgWLTkxyFTcuKKG54Qj9hWDGqbea-viVA_84hXnfhQjtb9mnFPk3JxwHNt7uRVPlQHL20ssJbI4sFeM_x6JieVguzWk_BooTyWrUSvPlZJhEA&encVer=1&c=p65I34SBpQVx6BAqAGIVf7RpeWGdZxDQ1FzrTI_s7h_NnD6zGww2FQ==&ch=XLyDKCHZBBZHmkDOq3j9u9NMqcrhCFfWl4SlDV31MJRXCggmXXUn7g==&source_id=8b8a69eb-69b8-42d2-962c-093bde3e67b4&source_type=em&c=p65I34SBpQVx6BAqAGIVf7RpeWGdZxDQ1FzrTI_s7h_NnD6zGww2FQ==)** **Categories:** News & Updates --- ### [Government of Canada Releases Draft Stablecoin Legislation](https://baxsecuritieslaw.com/government-of-canada-releases-draft-stablecoin-legislation/) **Published:** December 11, 2025 **Author:** Barbara Hendrickson **Content:** Concurrent with the release of Budget 2025 the Government of Canada has released draft legislation within *An Act to implement certain provisions of the budget tabled in Parliament on November 4, 2025* (Budget 2025 Implementation Act, No. 1) that would establish a federal framework for regulating stablecoins in Canada. The proposed Stablecoin Act (Proposed Act) establishes a framework for the regulation of “stablecoins” as a form of “currency” not meeting the definition of “securities” or “derivatives” under applicable securities law. The Proposed Act is not expected to apply to platform-restricted or single-merchant tokens. The Bank of Canada will have extensive supervisory and enforcement authority under the Proposed Act, including the power to impose undertakings or conditions on an applicant or issuer, impose administrative monetary penalties, provide public disclosure of non-compliance, impose compliance agreements, and will have the power to restrict or prohibit issuance where necessary for national security or for public interest reasons. Federally regulated financial institutions such as chartered banks are not covered by the Proposed Act. Financial Institutions will be allowed to invest in stablecoins if that activity does not result in “dealing in securities” which is subject to applicable securities laws or “accepting deposits” which is subject to financial services legislation. Provincially regulated financial institutions are also excluded from the legislation on the same basis. The carve out does not exempt stablecoins from applicable provincial securities or derivatives laws. The Proposed Act imposes certain duties of care on issuers making stablecoins available for purchase by Canadians and addresses, among other things, the redemption of stablecoins by issuers, the reserve of assets that issuers must maintained to fulfill their redemption obligations and the policies that they must establish. The Proposed Act will require the Bank of Canada to maintain a public registry of stablecoin issuers under which issuers must apply for registration. To be registered, issuers must provide information regarding: - ownership and organizational structure; - technological systems used for redemptions and how issuers plan to meet the reserve requirements, and a legal opinion regarding compliance with applicable legislation; - a statement from a certified accountant regarding the issuer’s financial condition governance policy; - risk management policy, data security policy, recovery and resolution policy; and - any enforcement actions in the areas of anti-money laundering and terrorist financing, financial services, securities and derivatives, market conduct or consumer protection. The Proposed Act sets out reserve requirements that issuers must meet, including that the reserve must have a value equal to or greater than the par value of all outstanding stablecoins and that it may not be used for any purpose other than redeeming outstanding stablecoins, subject to the regulations. The reserve must consist exclusively of the reference currency or other high‑quality liquid assets be unencumbered and must be held by a qualified custodian Canadian financial institution or other entity as provided in the regulations or through a trust or similar arrangement. The Proposed Act sets out other obligations on the issuer, relating to misleading advertising, including making representations that suggest a stablecoin is legal tender, a deposit, or insured under a government deposit-insurance scheme. The Proposed Act also prohibits issuers from offering or providing any form of interest or yield on a stablecoin, or on investment returns. Under the Proposed Act, issuers must establish and publish a redemption policy describing the conditions, manner and timing of redemptions, applicable fees and any third parties involved in the redemption process. Holders must be able to redeem their stablecoins at par value, and issuers must maintain adequate procedures to support timely redemptions. Among other things, issuers must maintain: - a comprehensive risk management framework; - business continuity plans; - third party oversight and controls to mitigate money laundering and terrorist financing risks; - separate data security program, dealing with protection of personal information and cybersecurity controls and safeguards; and - a wind-down plan that ensures the orderly redemption of outstanding stablecoins and preserves the claims of stablecoin holders on the reserve of assets. Issuers must file periodic reports that include: - a certified accountant’s report covering the financial condition of the issuer, the number of outstanding stablecoins, and the composition and fair market value of the reserve; and - a legal report confirming compliance with the reserve encumbrance prohibition and qualified custody and bankruptcy remote requirements. The Proposed Act does not replace Canadian securities laws, which may apply to the distribution and secondary trading of stablecoins that meet the definition of a “security” or “derivative.” Whether a stablecoin, or related issuance and trading activities, are captured by securities laws depends on the features of the stablecoin and how it is distributed or traded. Canadian securities laws will remain relevant for stablecoins offering yield or exposure to a basket of different assets or currencies, the distribution or solicitation by issuers of stablecoins triggering the dealer, custodial and marketplace requirements under applicable securities laws, including within existing CSA guidance, including: - [*CSA Staff Notice 21-332 Crypto Asset Trading Platforms: Pre-Registration Undertakings **–** Changes to Enhance Canadian Investor Protection*](https://www.osc.ca/en/securities-law/instruments-rules-policies/2/21-332/csa-staff-notice-21-332-crypto-asset-trading-platforms-pre-registration-undertakings-changes) - [*CSA Staff Notice 21-333 Crypto Asset Trading Platforms: Terms and Conditions for Trading Value-Referenced Crypto Assets with Clients.*](https://www.osc.ca/en/securities-law/instruments-rules-policies/2/21-333/csa-staff-notice-21-333-crypto-asset-trading-platforms-terms-and-conditions-trading-value) *Bill C-15, An Act to implement certain provisions of the budget tabled in Parliament on* *November 4,* *2025* [ is available for download](https://www.parl.ca/DocumentViewer/en/45-1/bill/C-15/first-reading) from the website of the Parliament of Canada. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial --- ### [Canadian Securities Regulators Publish CSA Multilateral Staff Notice 31-367 for Review and Comment](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-csa-multilateral-staff-notice-31-367-for-review-and-comment/) **Published:** December 4, 2025 **Author:** Barbara Hendrickson **Content:** Securities regulators in Ontario, Alberta, British Columbia, Québec, New Brunswick, Nova Scotia and Saskatchewan (the Participating Jurisdictions), have published a *CSA Multilateral Staff Notice 31-367 Notice and Consultation Regarding CSA Coordinated Blanket Order 31-930 Exemption to Allow Exempt Market Dealer Participation in Selling Groups in Offerings of Securities Under a Prospectus* (the Staff Notice). The Staff Notice, which is being published for a 60-day comment period ending January 26, 2026, advises that the time-limited exemption announced in CSA Notice Regarding [Coordinated Blanket Order 31-930](https://www.securities-administrators.ca/news/canadian-securities-regulators-provide-update-and-seek-feedback-on-multilateral-initiative-to-support-capital-raising-by-extending-the-role-of-exempt-market-dealers/#31930) *Exemption to Allow Exempt Market Dealer Participation in Selling Groups in Offerings of Securities Under a Prospectus* which expires on December 20, 2025, will not be extended. The exemption, introduced in late June 2024, enabled exempt market dealers to assist start-ups and small- to medium-sized businesses raise capital as they grow and mature by participating in selling groups in prospectus offerings, but it only saw limited use. In the Staff Notice, the securities regulators are also seeking feedback on the exemption. Feedback will be used to guide future policymaking, including whether future revised exemptions should be published. *CSA Multilateral Staff Notice 31-367 – Notice and Consultation Regarding CSA Coordinated Blanket Order 31-930 Exemption to Allow Exempt Market Dealer Participation in Selling Groups in Offerings of Securities Under a Prospectus* [ is available for download](https://www.osc.ca/sites/default/files/2025-11/csa_20251127_31-367_blanket-order-exemption.pdf) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Governments --- ### [CSA Publishes Notice and Request for Comment – Proposed Amendments to National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure](https://baxsecuritieslaw.com/csa-publishes-notice-and-request-for-comment-proposed-amendments-to-national-instrument-52-112-non-gaap-and-other-financial-measures-disclosure-2/) **Published:** December 4, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) has published *CSA Notice and Request for Comment – Proposed Amendments to National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure* (the Proposed Amendments) for a comment period ending February 11, 2026. The Proposed Amendments primarily seek to ensure that measures that have historically been subject to the requirements of NI 52-112 remain subject to its requirements following the adoption of a new International Financial Reporting Standards (IFRS) Accounting Standard, IFRS 18 Presentation and Disclosure in Financial Statements. IFRS 18 will be effective for annual reporting periods beginning on or after January 1, 2027. It requires disclosure of management-defined performance measures in a single note to the financial statements. Without the Proposed Amendments, these measures, which have historically been considered non-GAAP financial measures, would not be subject to the disclosure requirements in NI 52-112 when disclosed outside of the financial statements. The Proposed Amendments would introduce a prominence requirement when an additional subtotal is disclosed outside the financial statements. This would promote connectivity with IFRS 18, which requires an additional subtotal presented on the face of a primary financial statement, such as the statement of profit or loss, to be displayed no more prominently than the totals and subtotals required by IFRS Accounting Standards. *(CSA Notice and Request for Comment – Proposed Amendments to National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure)* [ is available for download](https://www.osc.ca/sites/default/files/2025-11/csa_20251113_52-112_rfc-financial-measures-disclosure.pdf) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial --- ### [CSE Publishes Notice 2025-006 - Notice of Approval - Amendments to CSE Listing Policies - Major Acquisitions](https://baxsecuritieslaw.com/cse-publishes-notice-2025-006-notice-of-approval-amendments-to-cse-listing-policies-major-acquisitions/) **Published:** November 20, 2025 **Author:** Barbara Hendrickson **Content:** CSNX Markets Inc. (CSE) has published *Notice 2025-006 – Notice Of Approval – Amendments* To *CSE Listing Policies – Major Acquisitions* (The Amendments). Publication was subject to approval of The Amendments by the participating jurisdictions in Ontario and British Columbia, the Ontario Securities Commission (OSC) and the British Columbia Securities Commission (BSCSC). The Amendments, which are under the Protocol to CSE Listing Policies (Policies), introduce an approval requirement for Major Acquisitions and broaden the application of its definition in the Policies. With the implementation of The Amendments, CSE will introduce a specific approval process for a re-defined ‘Major Acquisition’ that is separate and apart from the process applicable to a Fundamental Change. A Listed Issuer intending to complete a Major Acquisition, based on the proposed re-definition, would need to obtain approval from the CSE before completion of the transaction which could result in additional changes to the structure of, or the conditions on, the transaction. It would exclude Major Acquisitions from the existing deemed approval process. *Canadian Securities Exchange – Public Interest Rule Amendments – Proposed Amendments to CSE Listing Policies – Notice and Request for Comments)* [are available for download](https://www.osc.ca/sites/default/files/2025-11/cse_20251113_proposed-amendments-listing-policies.pdf) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Business Law --- ### [Budget 2025 Introduces a Regulated Space for Stablecoins](https://baxsecuritieslaw.com/budget-2025-introduces-a-regulated-space-for-stablecoins/) **Published:** November 20, 2025 **Author:** Barbara Hendrickson **Content:** Budget 2025 which was recently passed in the Canadian House of Commons, announced the government’s intention to introduce legislation to regulate the issuance of fiat-backed stablecoins in Canada. This legislation will require issuers to maintain and manage adequate asset reserves, establish redemption policies, implement risk management frameworks, and protect the sensitive and personal information of Canadians. The legislation will also include national security safeguards to support the integrity of the framework so that fiat-backed stablecoins are safe and secure for consumers and businesses to use. To administer the relevant legislation, the Bank of Canada will retain $10 million over two years, starting in 2026-27, from its remittances to the Consolidated Revenue Fund. Administrative costs in subsequent years are projected to be $5 million per year and will be offset from stablecoin issuers regulated under the Retail Payments Activities Act (the RPAA). Related amendments to the RPAA will also be made to enable the regulation of payment service providers that carry out payment functions using prescribed stablecoins. *Budget 2025* [ is available for download](https://budget.canada.ca/2025/report-rapport/pdf/budget-2025.pdf) from the website of the Government of Canada. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial, Governments --- ### [BAX Securities Law Announces November Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-november-toronto-business-lawyers-association-monthly-meeting-2/) **Published:** November 7, 2025 **Author:** Barbara Hendrickson **Content:** Toronto, November 7, 2025: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday November 27, 2025, at **9:30** **am** at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson, founder of BAX Securities Law, over ten years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together for business and professional development purposes. The TBLA meetings are held once a month at **9:30 am** at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. The next monthly meeting is at **9:30 am** on November 27, 2025, at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . For more information on the TBLA and its events please contact Barbara at ([www.baxsecuritieslaw.com](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001Wc_Ki0i15qqm3dJpfIn-pRnPJobgrBdU52pUd4HwXdW3Vmo0OJZdWIPR8HbWIyxFwkp8xWJ4qyWRRGQPJtz1i93SBGbCfYZiKrQlmA1zHodc8h5Xcj1KDrP7kLODsC-nG9csK7HA3lqIv2eswnlAbcL94IcXF1My&c=ahvwTNo6fGBZ36Ejof00cKXyp0kLCFVOL4VLWCBzEVlpCdojA91Oww==&ch=mfZZ_AyQedktYs3yY2vz0a1eeJD1Mjv50foCLHcQiKHO6OqJtLAGXw==)) **Categories:** News & Updates --- ### [Funding Your Fintech: Navigating the Drought in Canadian Venture Capital.](https://baxsecuritieslaw.com/funding-your-fintech-navigating-the-drought-in-canadian-venture-capital/) **Published:** October 23, 2025 **Author:** Barbara Hendrickson **Content:** Thanks for joining Barbara Hendrickson and Robb Miller for our October 23, 2025 webinar on “Funding Your Fintech: Navigating the Drought in Canadian Venture Capital”. [Please find our presentation here](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/Funding-your-Fintech-BAX-Oct-27-2025.pdf) 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. For more information on this event, contact Barbara Hendrickson 1(647) 403-4606 or at **Categories:** News & Updates --- ### [CSA Proposes Semi-Annual Reporting Pilot](https://baxsecuritieslaw.com/csa-proposes-semi-annual-reporting-pilot/) **Published:** October 24, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) recently published *Notice and Request for Comment – Coordinated Blanket Order 51-933* *Exemptions to Permit Semi-Annual Reporting for Certain Venture Issuers,* a proposed multi-year pilot to allow eligible venture issuers to voluntarily adopt semi-annual financial reporting (the Proposed SAR Pilot). The regulator is publishing the Proposed SAR Pilot for a 90-day comment period ending December 22, 2025. The Proposed SAR Pilot would provide an exemption for certain venture issuers listed on the TSX Venture Exchange Inc. (TSXV) or the CNSX Markets Inc. (CSE) from the requirement to file first and third quarter financial reports under *National Instrument 51-102 Continuous Disclosure Obligations* (NI 51-102). The Proposed SAR Pilot would be introduced through coordinated blanket orders across the CSA’s participating jurisdictions, which would include exemptions from certain continuous disclosure requirements and establish a voluntary semi-annual reporting framework for a subset of venture issuers, subject to certain terms and conditions. The regulator notes that it intends to engage in a broader rule-making project related to voluntary semi-annual reporting. **Notice and Request for Comment – Coordinated Blanket Order 51-933** *Exemptions to Permit Semi-Annual Reporting for Certain Venture Issuers* [is available for download](https://www.securities-administrators.ca/news/canadian-securities-regulators-propose-semi-annual-financial-reporting-pilot/#51933) from the website of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Governments --- ### [CSA Updates Requirements For Delivering Proxy-Related Materials During Canada Post Labour Dispute](https://baxsecuritieslaw.com/csa-updates-requirements-for-delivering-proxy-related-materials-during-canada-post-labour-dispute/) **Published:** October 23, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) has updated requirements for delivering proxy-related materials for shareholder meetings, advising that the relief is no longer required under *Coordinated Blanket Order 51-932* *Temporary Exemption from requirements in National Instrument 51-102 Continuous Disclosure Obligations and National Instrument 54-101 Communication with Beneficial Owners of Securities of a Reporting Issuer to send certain proxy-related materials during a postal suspension* (The Blanket Order). This move comes as the Canadian Union of Postal Workers (CUPW) moves from a nationwide postal strike to a series of rotating strikes in their ongoing labour dispute with Canada Post, and the resumption of postal service. The CSA had originally issued The Blanket Order on October 9, 2025, providing temporary relief from requirements to deliver proxy-related materials for shareholder meetings to consider “annual matters” during a complete suspension of all postal service in Canada. It was a condition of the relief that commercial volumes were not accepted by Canada Post. Since Canada Post has resumed mail deliveries and is now accepting commercial volumes, the regulator decided that relief in the Blanket Order is no longer available, and relief from delivery requirements in securities legislation in connection with the postal strike is no longer required. In the event of an escalation in labour action resulting in another complete suspension of postal service in Canada, the CSA will provide further information. *Coordinated Blanket Order 51-932* *Temporary Exemption from requirements in National Instrument 51-102 Continuous Disclosure Obligations and National Instrument 54-101*[ is available for download](https://www.securities-administrators.ca/news/csa-clarifies-requirements-for-delivering-proxy-related-materials-during-canada-post-labour-dispute/#51932) from the websites of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Governments --- ### [BAX Securities Law’s Barbara Hendrickson interviewed by Bloomberg News](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-interviewed-by-bloomberg-news/) **Published:** October 23, 2025 **Author:** Barbara Hendrickson **Content:** BAX Securities Law’s Barbara Hendrickson is featured in a recent article in Bloomberg News, [“ETF Pioneer Som Seif Fights Back as Canada Regulator Questions ESG Claims,”](https://www.bloomberg.com/news/articles/2025-10-06/som-seif-purpose-investments-fight-ontario-securities-commission-claim?accessToken=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJzb3VyY2UiOiJTdWJzY3JpYmVyR2lmdGVkQXJ0aWNsZSIsImlhdCI6MTc1OTc1NDY4MiwiZXhwIjoxNzYwMzU5NDgyLCJhcnRpY2xlSWQiOiJUMlFUUTJHT1lNVE4wMCIsImJjb25uZWN0SWQiOiIzREZGMDYwNjg5NzA0RkE5QUE3NUQzMzg0NDAyNkExOSJ9.rG4V6daXU9zK5sbt5VJClrZMC3NTu8PtooOgfO_rWg4&leadSource=uverify%20wall) The article, by Bloomberg reporter Melissa Shin discusses the events surrounding the Ontario Securities Commission’s (OSC) charges against Purpose Investments and its founder, Som Seif, alleging Purpose had made false and misleading statements about its use of environmental, social and governance (ESG) factors in its investment decisions. In the article, Barbara noted that despite the outcome of the case against Seif and Purpose, securities regulators will continue to closely scrutinize disclosure statements. She said regulators have warned “that they’re going to be reviewing disclosure very carefully.” Besides her present position as Securities Partner with BAX Securities Law, the article also notes that Barbara also held a staff position with the OSC. Afterwards she, also was a member of the OSC’s Securities Advisory Committee (SAC) from 2018 to 2021. The SAC provides advice to the OSC and staff on a variety of matters including legislative and policy initiatives and important capital markets trends and brings various issues to the attention of the Commission and staff. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BCSC Compliance Report Card Highlights 2024 Compliance Reviews](https://baxsecuritieslaw.com/bcsc-compliance-report-card-highlights-2024-compliance-reviews/) **Published:** October 2, 2025 **Author:** Barbara Hendrickson **Content:** The British Columbia Securities Commission (BCSC) has published its *2024 Annual Compliance Report Card* (the Report Card), which details the know-your-client (KYC) deficiencies of BC investment firms that underwent compliance reviews. The Report Card notes that the regulator conducted 19 compliance reviews and found 130 deficiencies, with an average of 6.84 deficiencies per review. Of the registrants reviewed, KYC and suitability deficiencies were most common, followed by deficiencies in policies and procedures, conflicts of interest, disclosure, and client statements and reporting. Together, these deficiencies represented approximately 72% of all compliance deficiencies reported in 2024. Some deficiencies were significant failures of compliance that led the BCSC to impose terms and conditions on registration, such as requiring the hiring of a compliance monitor to prevent new clients from being onboarded until the failures have been corrected. The regulator took compliance action against two dealer firms, one of which was suspended, and the other voluntarily terminated its registration. In addition, four firms with systemic failures or cultures of compliance that fell significantly short of expectations were referred to the BCSC’s Enforcement Division for further investigation. The reviews also found an increasing number of deficiencies in annual financial statement submissions. Failure to deliver this information within 90 days of their annual year-end is often an indicator of other compliance issues that can result in a broader review of a firm. In 2024, the BCSC reached settlements with several firms and individuals, including those who failed to respond to conflicts of interest, as well as those who fell short of KYC requirements. The BCSC is the principal regulator for approximately 174 advisor and dealer firms. *The 2024 Annual Compliance Report* *Card* [is available for download](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Industry/Registrant-Regulation/Compliance-Toolkit/2024-CMR-Annual-Compliance-Report-Card.pdf) from the website of the British Columbia Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Adopts Final Amendments To Mandatory Central Counterparty Clearing Of Derivatives](https://baxsecuritieslaw.com/csa-adopts-final-amendments-to-mandatory-central-counterparty-clearing-of-derivatives/) **Published:** October 2, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) has published final amendments to National Instrument 94-101 Mandatory Central Counterparty Clearing of Derivatives (NI 94-101) (The Final Amendments). The amendments were finalized after considering comments received on proposed amendments published in 2024 (in 2025 for the BC Securities Commission). The Final Amendments aim to update the list of mandatory clearable over- the-counter (OTC) derivatives to reflect the transition to a new interest rate benchmarks regime based on overnight interest rate benchmarks (referred to as risk-free interest rate benchmarks). The Final Amendments also add certain classes of derivatives to this list of mandatory clearable OTC derivatives (provided in Appendix A of NI 94-101). NI 94-101 came into force in 2017 with the purpose of reducing counterparty risk in the OTC derivatives market and addressing a potential risk to financial stability, by requiring certain counterparties to clear certain prescribed derivatives through a central counterparty. Provided all necessary ministerial approvals are obtained, the amendments will come into force on March 25, 2026 in all CSA jurisdictions. *Final Amendments to National Instrument 94-101 Mandatory Central Counterparty Clearing of Derivatives (NI 94-101* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/9/94-101-94-101cp) from the websites of CSA jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial --- ### [Canadian Securities Regulators Launch Consultation On Proposed Harmonized Multilateral Self-Certified Investor Prospectus Exemption](https://baxsecuritieslaw.com/canadian-securities-regulators-launch-consultation-on-proposed-harmonized-multilateral-self-certified-investor-prospectus-exemption/) **Published:** October 2, 2025 **Author:** Barbara Hendrickson **Content:** The securities regulators of Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island, Saskatchewan, and Yukon (the Participating Jurisdictions) have published Proposed Multilateral Instrument 45-111 *Self-Certified Investor Prospectus Exemption* (the Proposed Exemption) for review and comment for a period ending January 5, 2026. The Proposed Exemption details a proposed new harmonized multilateral instrument to support capital raising for Canadian businesses and investment opportunities for eligible investors within the Participating Jurisdictions. It would complement existing accredited investor exemptions to enable broader participation in the capital markets by individuals with relevant experience or expertise. To invest as a self-certified investor, a person must certify that they meet at least one of the qualifying criteria and acknowledge the investment risks. Self-certified investors would be permitted to invest up to $50,000 per calendar year across multiple businesses. Proposed Multilateral Instrument 45-111 *Self-Certified Investor Prospectus Exemption* aims to harmonize the exemption across the participating jurisdictions and, if adopted, would replace: - Alberta Securities Commission Blanket Order 45-538 *Self-Certified Investor Prospectus Exemption*; - Financial and Consumer Affairs Authority of Saskatchewan General Order 45-538 *Self-Certified Investor Prospectus Exemption*; - Manitoba Securities Commission Blanket Order 45-505 *Self-Certified Investor Prospectus Exemption*; and - Ontario Securities Commission Instrument *45-510 Self-Certified Investor Prospectus Exemption (Interim Class Order).* *CSA Notice and Request for Comment Proposed Multilateral Instrument* 45-111 *Self-Certified Investor Prospectus Exemption* [ is available for download](https://www.osc.ca/en/securities-law/proposed-instruments-rules-and-policies) from the websites of the Participating Jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Governments --- ### [BAX Securities Law Invites you to Funding Your Fintech: Navigating the Drought in Canadian Venture Capital](https://baxsecuritieslaw.com/bax-securities-law-invites-you-to-funding-your-fintech-navigating-the-drought-in-canadian-venture-capital/) **Published:** October 2, 2025 **Author:** Barbara Hendrickson **Content:** **October 23, 2025 9:30AM EST** **Webinar** Please join Barbara Hendrickson and Robb Miller for our webinar on “Funding Your Fintech: Navigating the Drought in Canadian Venture Capital.” The webinar is in first as a series of seminars sponsored by BAX Securities Law focusing on Fintechs operating and thriving in the Canadian capital markets. The Canadian fintech sector is maturing fast, but the funding environment has never been more challenging. As global VC dollars tighten and local investors become more selective, fintech founders are forced to get creative—blending traditional venture capital, alternative financing, and cross-border and international strategies to keep their growth on track. We will break down the current landscape, highlighting the main players, and offering practical guidance on structuring your raise—including cross-border, tokenization, and crowdfunding considerations. We will also discuss recent initiatives by securities commissions across Canada to facilitate early stage capital raising as well as changes to TSX and TSXV rules designed to streamline and update the listing process. Participants will have the opportunity to contribute questions for the panelists online during the webinar. For more information on this event, contact Barbara Hendrickson 1(647) 403-4606 or at **Webinar Details:** Thursday, October 23, 2025 | 9:30 – 10:30 a.m. EST ***Click here to*** [***RSVP***](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001SAcnXclN10aLzhb_AwMrB2coa1LYme15lRcqvjCB4r8MSt_IBYYx01HS8VKnax9FZLZNpRPKsCN7uTNrAtIVokRLKflEs05uUYwtX9ElAj5rk1pQx90vVVAXPSY6GZZbAT60xT0JlDPtVXS1IOhnnKhlueReZH2T0PN-btFsKAQ=&c=&ch=) **Categories:** News & Updates --- ### [Euronext Decoded](https://baxsecuritieslaw.com/euronext-decoded/) **Published:** September 17, 2025 **Author:** Barbara Hendrickson **Content:** Euronext NV (European New Exchange Technology) is Europe’s largest stock exchange one of the largest in the world. It was created in 2000 with the merger of the Amsterdam, Paris, and Brussels stock exchanges in 2000. With headquarters in Paris, it operates exchanges in seven countries: France, the Netherlands, Belgium, Ireland, Portugal, Italy, and Norway. Euronext trades in regulated equities, ETF warrants and certificates, bond, derivatives, foreign exchange, and indices, including ESG (Environmental, Social and Governance), Gender Equality, AI & NLP, Cybersecurity, Fixed Income indices. In 2023, Euronext had over 2,000 listed issuers with a total market capitalization of €6.6 trillion. In addition to Euronext’s regulated exchanges, it also operates Euronext Access and Euronext growth. For companies considering listing on one of the Euronext exchanges, they must select an appropriate market based on their corporate profile. Euronext’s listing specialists who are assigned to specific markets, are available to guide potential issuers through the process. More information about Euronext is available on the [company’s website.](https://www.euronext.com/en) If you are a Canadian company (listed or non-listed) and are interested in discussing opportunities for listing on the Euronext, please contact Barbara Hendrickson at BAX Securities Law (647) 403-4606 or email her at bhendrickson@baxsecuritieslaw.com. 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. **Categories:** News & Updates --- ### [BAX’s Barbara Hendrickson included in the 2026 edition of The Best Lawyers in Canada](https://baxsecuritieslaw.com/baxs-barbara-hendrickson-included-in-the-2026-edition-of-the-best-lawyers-in-canada/) **Published:** September 10, 2025 **Author:** Barbara Hendrickson **Content:** BAX Securities Law is pleased to announce that its founder and Securities Partner, Barbara Hendrickson, is included in the 2026 edition of *The Best Lawyers in Canada*. The Best Lawyers® awards are given to lawyers who while demonstrating comprehensive expertise in their professional practices, also have also shown adaptability, ethics, and leadership. *The Best Lawyer* awards are seen as of symbols of esteem and the recognition of integrity in the legal community. *The Best Lawyers in Canada™* celebrates 20 years of peer-reviewed recognition, highlighting the Canada’s most respected lawyers. This year, 8,440 lawyers earned distinction, representing roughly six percent of Canada’s lawyers. That means for every 300 lawyers in Canada, only one achieves this honor, underlining its rarity and esteem. Barbara joins Best Lawyers® international network of recognized lawyers, reflecting both enduring her expertise and new perspectives shaping Canadian legal practice. *Best Lawyers* has published its guide for the legal profession and recognized top legal talent in 76 countries worldwide for more than 40 years. You can learn more about the methodology process and find additional details for this guide on [*The Best Lawyers*](https://www.bestlawyers.com/article/the-best-lawyers-in-canada-2026-awards-announced/6872)[’ website](https://www.bestlawyers.com/article/the-best-lawyers-in-canada-2026-awards-announced/6872). For more information on BAX Securities Law and Barbara’s practice, please call Barbara Hendrickson (647) 403-4606 or contact her at bhendrickson@baxsecuritieslaw.com. 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. **Categories:** News & Updates --- ### [BAX Securities Law Announces September Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-september-toronto-business-lawyers-association-monthly-meeting/) **Published:** September 5, 2025 **Author:** Barbara Hendrickson **Content:** Toronto, September 5, 2025: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday September18, 2025, at **9:30** **am** at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson, founder of BAX Securities Law, over ten years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together for business and professional development purposes. The TBLA meetings are held once a month at **9:30 am** at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. The next monthly meeting is at **9:30 am** on September 18, 2025, at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . For more information on the TBLA and its events please contact Barbara at ([www.baxsecuritieslaw.com](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001Wc_Ki0i15qqm3dJpfIn-pRnPJobgrBdU52pUd4HwXdW3Vmo0OJZdWIPR8HbWIyxFwkp8xWJ4qyWRRGQPJtz1i93SBGbCfYZiKrQlmA1zHodc8h5Xcj1KDrP7kLODsC-nG9csK7HA3lqIv2eswnlAbcL94IcXF1My&c=ahvwTNo6fGBZ36Ejof00cKXyp0kLCFVOL4VLWCBzEVlpCdojA91Oww==&ch=mfZZ_AyQedktYs3yY2vz0a1eeJD1Mjv50foCLHcQiKHO6OqJtLAGXw==)) **Categories:** News & Updates --- ### [CIRO Publishes Proposed Disgorgement Rules for Comment and Review](https://baxsecuritieslaw.com/ciro-publishes-proposed-disgorgement-rules-for-comment-and-review/) **Published:** August 27, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Investment Regulatory Organization (CIRO) is publishing for comment proposed amendments to the Mutual Fund Dealer (MFD) Rules to specifically provide for disgorgement to conform with the Investment Dealer and Partially Consolidated (IDPC) Rules (the “Proposed Amendments.) CIRO is publishing the Proposed Amendments for a comment period ending **September 22nd, 2025.** In law, the concept of disgorgement refers to the return of all gains (either profits or avoidance of loss) resulting from illegal or unethical conduct. While the current IDPC Rules explicitly address disgorgement and fines as distinct types of sanctions, the MFD Rules do not provide for it. However, CIRO hearing panels adjudicating proceedings under the MFD Rules are empowered to impose fines of the same amount as the profit obtained or loss avoided. To add clarity and predictability for Mutual Fund Dealer Members and their Approved Persons, the Proposed Amendments are intended to harmonize the drafting across the rule sets that allow CIRO hearing panels to order disgorgement by replicating the same provision that currently exists in IDPC Rules, and mirroring that drafting in the MFD Rules. *Canadian Investment Regulatory Organization (CIRO) – Proposed Amendments to the Mutual* *Fund Dealer Rules Respecting Disgorgement – Reques*t *for Comment* [ is available for download](https://www.osc.ca/sites/default/files/2025-08/ciro_20250821_mutual-fund-dealer-rules.pdf) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Governments --- ### [FINTECH Update: Payment Service Providers eligible for Payments Canada Membership and RTR Payments System](https://baxsecuritieslaw.com/fintech-update-payment-service-providers-eligible-for-payments-canada-membership-and-rtr-payments-system/) **Published:** September 3, 2025 **Author:** Barbara Hendrickson **Content:** With recent amendments to the *Canadian Payments Act* and the introduction of the *Retail Payments Activities Act*, Payment Service Providers (PSPs) are eligible for Payments Canada membership and access to the Real-Time Rail (RTR) system. The RTR is an always-on, real-time clearing and settlement system that enables PSPs to provide their clients with immediate funds delivery and payment processing. With real-time settlement, PSPs will be able to eliminate credit risk between participants, freeing liquidity and strengthening financial stability. The RTR is designed to support multiple business models and meet PSPs’ strategic needs. Understanding the RTR’s operating model, technical requirements, onboarding process and ongoing system management will help PSPs best capitalize on the RTR’s instant payment capabilities. Payments Canada has made available *The Real-Time Rail Participation Guide for Payment Service Providers* (the Guide), which outlines the process for becoming a Payments Canada member and RTR participant, along with the technical, operational and business requirements to participate. *The Real-Time Rail Participation Guide for Payment Service Providers* [ is available for download](https://mailchi.mp/payments.ca/the-rtr-psp-participation-guide-download) from the website of the Payments Canada. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial, Governments --- ### [CSA Adopts Expedited Shelf Prospectus Regime For Well-Known Seasoned Issuers](https://baxsecuritieslaw.com/csa-adopts-expedited-shelf-prospectus-regime-for-well-known-seasoned-issuers/) **Published:** September 3, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) recently published *Amendments to* *National Instrument 44-102 – Shelf Distributions* (the Amendments), adopting an expedited shelf prospectus regime for well-known seasoned issuers (WKSIs) in Canada, further enhancing the competitiveness of Canadian markets. The Amendments introduce an expedited shelf prospectus regime for WKSIs in Canada who have a strong market following, complete public disclosure record, and sufficient public equity. The intent is to reduce the regulatory burden on these issuers and make it easier for them to raise capital in the Canadian public markets. The Amendments allow eligible issuers to: - File a final base shelf prospectus and be deemed to have received a receipt for that prospectus without first filing a preliminary base shelf prospectus or undergoing any regulatory review. - Omit certain disclosure from the base shelf prospectus (for example, the aggregate dollar amount of securities that may be raised under the prospectus). - Benefit from receipt effectiveness for a period of 37 months from the date of its deemed issuance, subject to the issuer reassessing its eligibility annually. Provided all necessary regulatory approvals are obtained, the Amendments will become effective in all CSA jurisdictions on November 28, 2025. *Amendments to National Instrument 44-102 – Shelf Distributions* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/4/44-102) from the websites of CSA jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Governments --- ### [Bank of Canada issues update on Payment Service Providers Registry](https://baxsecuritieslaw.com/bank-of-canada-issues-update-on-payment-service-providers-registry/) **Published:** August 27, 2025 **Author:** Barbara Hendrickson **Content:** The Bank of Canada (The Bank) has announced that effective September 8, 2025, it will publish a list of Payment Service Providers (PSPs) that have registered under the Retail Payment Activities Act (The Act). On that same day, the Bank will also publish the names of entities whose applications have been refused registry. PSPs on the registry will be subject to supervisory assessments by the Bank. Registered PSPs are expected to comply with obligations for operational risk and safeguarding of end-user funds, as well as reporting under the Act. PSPs that remain on the applicant list are also expected to comply with the same regulatory obligations but will not need to follow all reporting requirements until they become registered. The Bank will maintain a list of individuals and companies that have applied to register, but whose reviews have not yet been finalized. It advises that not all submitted applications will be fully processed by September 8th. The Bank will update the registry on a rolling basis as more PSPs are registered. Further updates will be published by the Bank on its [website](https://www.bankofcanada.ca/core-functions/retail-payments-supervision/) and on its [PSP Connect](https://rps.bankofcanada.ca/) portal. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** Financial --- ### [CSA Publishes for Review and Comment Proposed Process Refinements and Dispute Resolution Oversight](https://baxsecuritieslaw.com/csa-publishes-for-review-and-comment-proposed-process-refinements-and-dispute-resolution-oversight/) **Published:** July 22, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) has recently published for review and comment *CSA Notice and Request for Comment 25-314 – Proposed approach to oversight and refinements to the proposed binding authority framework for an identified ombudservice* (the Proposed Approach), for a 60-day period ending September 15, 2025. At the same time, the CSA is also publishing for comment proposed refinements to the regulatory framework (the Proposed Framework) first published by the CSA for comment on November 30, 2023, which are also due September 15, 2025. The Proposed Approach provides more details of the binding authority, anticipated to be the Ombudsman for Banking Services and Investments (OBSI). The consultation includes a proposed oversight model for OBSI, and refinements of the review and decision stage of the dispute resolution process. The regulator’s goal is to help modernise the structure of Canada’s capital markets and simplify the complaints process for investors and businesses. Included with the Proposed Approach, the CSA introduces a Proposed Oversight Framework that balances OBSI’s independence with the need for accountability. Based on the comments received during the 2023 consultation, the regulator is also proposing changes to the second-stage review of the dispute resolution process for OBSI compensation recommendations equal to or exceeding $75,000. For these complaints, OBSI will be required to appoint external decision-makers to review its recommendation before reaching a final decision. CSA staff advise that many of its participating jurisdictions will require legislative amendments to enable the proposed framework, including the oversight framework. Any amendments to local legislation would be proposed by governments. Proposed legislative amendments would only become law in a CSA jurisdiction if they are proclaimed and in force in that jurisdiction. *CSA Notice and Request for Comment 25-314 – Proposed approach to oversight and refinements to the proposed binding authority framework for an identified ombudservice* [ is available for download](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/2-certain-capital-market-participants/current/25-314/25314-csa-notice-and-request-for-comment-july-15-2025) from the websites of the participating members of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Securities Regulators’ Report Highlights Sales Culture Concerns at Canada’s Largest Bank-Affiliated Dealers](https://baxsecuritieslaw.com/securities-regulators-report-highlights-sales-culture-concerns-at-canadas-largest-bank-affiliated-dealers/) **Published:** July 22, 2025 **Author:** Barbara Hendrickson **Content:** A recent report by the Ontario Securities Commission (OSC) and the Canadian Investment Regulatory Organization (CIRO), *Sales Culture Concerns at Five of Canada’s Bank-Affiliated Dealers* (The Report). The Report, which presents survey results from nearly 3,000 mutual fund dealing representatives from five of Canada’s largest bank-affiliated dealers, found that one in four representatives surveyed reported that they had “sometimes” recommended products or services that were not in their clients’ best interests. While The Report showed that representatives held some positive perceptions, it also outlined areas of concern. This included that forty per cent of representatives believed scorecards (a means of tracking performance against target measures, including sales targets and/or activity-based targets) influenced product and service recommendations to clients. The Report also found that one in three representatives reported providing their clients with incorrect information about products and services they recommended. The OSC and CIRO believe the sales environment, compensation, incentivization, and performance tracking may be contributing factors to these results. *Sales Culture Concerns at Five of Canada’s Bank-Affiliated Dealers* [ is available for download](https://www.osc.ca/en/news-events/reports-and-publications/sales-culture-concerns-five-canadas-bank-affiliated-dealers) from the websites of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Issue Guidance About Regulatory Concerns With Certain Asset Or Business Acquisitions](https://baxsecuritieslaw.com/canadian-securities-regulators-issue-guidance-about-regulatory-concerns-with-certain-asset-or-business-acquisitions/) **Published:** July 7, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) have recently published *CSA Staff Notice 51-366 Regulatory Concerns with Certain Asset or Business Acquisitions* (the Staff Notice) that provides guidance about regulatory concerns with certain with certain asset or business acquisitions – primarily taking place in venture markets –including concerns with misleading disclosure that could constitute market manipulation. The guidance provided in the Staff Notice relates to reporting issuers that distribute a significant number of securities to acquire assets or businesses that appear to have little or no actual value or operating history and pay what appear to be significantly inflated prices. The Staff Notice explains the regulatory concerns with these types of acquisitions and reminds issuers of the requirements that may apply but does not introduce any new requirements. Key regulatory concerns with these transactions include: - The potential for misleading disclosure or misrepresentations in a reporting issuer’s continuous disclosure record; - A potential lack of a reasonable basis for the value ascribed to the asset or business being acquired; - Potentially untrue or unbalanced promotional campaigns to support the acquisition; and, - Whether a reporting issuer records all or a portion of the consideration paid as intangible assets or goodwill based on unreasonable or unsupportable assumptions, and impairs them shortly after the acquisition. CSA staff advise that they will continue to apply additional regulatory scrutiny to reporting issuers involved in acquisitions that appear to raise the concerns set out in the Staff Notice. *CSA Staff Notice 51-366 Regulatory Concerns with Certain Asset or Business Acquisitions*[ is available for download](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-5/51366-CSA-Notice-July-3-2025.pdf?dt=202506272108) from the websites of member jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [The Strong Borders Act amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA)](https://baxsecuritieslaw.com/the-strong-borders-act-amends-the-proceeds-of-crime-money-laundering-and-terrorist-financing-act-pcmltfa/) **Published:** June 30, 2025 **Author:** Barbara Hendrickson **Content:** *Bill C-2, The Strong Borders Act* (the Bill) was recently introduced in the Parliament of Canada as a centrepiece legislation of the new Liberal Government of Prime Minister Mark Carney. The Bill, if passed, proposes to amend the *Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA)* to: - Strengthen anti-money laundering supervision, compliance, and enforcement, including through increased civil and criminal penalties; - Address some of the most prevalent types of money laundering, including through new restrictions on large cash transactions and third-party cash deposits; - Require businesses regulated for anti-money laundering purposes, that are not already registered, to enroll with Financial Transactions and Reports Analysis Centre of Canada (FINTRAC); and - Permit disclosures from the FINTRAC to the Office of the Commissioner of Canada Elections. The Bill also proposes to amend the PCMLTFA with related amendments to the Personal Information Protection and Electronic Documents Act to clarify public to private information sharing provisions to help better detect and deter money laundering and support the recently created Integrated Money Laundering Intelligence Partnership (IMLIP) between banks and law enforcement. The Bill proposes to amend the *Office of the Superintendent of Financial Institutions Act* to make the Director of FINTRAC a member of the Financial Institutions Supervisory Committee (FISC), as well as to amend the *Proceeds of Crime (Money Laundering) and Terrorist Financing Act* to enable the Director to exchange information with the other members of FISC. More Information about *Bill C2, The Strong Borders Ac*t [ is available for download](https://www.canada.ca/en/public-safety-canada/news/2025/06/the-strong-borders-act---government-of-canada-strengthens-border-security.html) from the websites of the Government of Canada. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Proposes Amendments To Modernize And Streamline Mining Disclosure Standards](https://baxsecuritieslaw.com/csa-proposes-amendments-to-modernize-and-streamline-mining-disclosure-standards/) **Published:** June 18, 2025 **Author:** Barbara Hendrickson **Content:** The Canadian Securities Administrators (CSA) is seeking feedback on proposed amendments to National Instrument 43-101 *Standards of Disclosure for Mineral Projects* (The Proposed Amendments). They are being published for a 120-day comment period ending August 1, 2025. The Proposed Amendments are intended to clarify, harmonize and streamline Canada’s mining disclosure regime without introducing any new requirements. The proposed amendments would update and enhance the standards for disclosing scientific and technical information about mineral projects to address evolving disclosure practices and policy considerations identified by CSA staff, and to reflect changing industry and investor expectations. They are designed to: - remove or replace certain definitions and requirements that have become outdated - modernize and streamline certain requirements to reflect current industry practice - provide clarification and guidance on certain definitions and requirements, and - make other minor language changes to clarify disclosure requirements. The Proposed Amendments to National Instrument 43-101 *Standards of Disclosure for Mineral Projects)* [ *are available for download*](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/4-distribution-requirements/current/43-101) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Securities Commission Publishes Amendments To Rules Governing Trading During Distributions, Formal Bids, And Share Exchange Transactions](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-amendments-to-rules-governing-trading-during-distributions-formal-bids-and-share-exchange-transactions/) **Published:** June 9, 2025 **Author:** Barbara Hendrickson **Content:** The Ontario Securities Commission (OSC) has published proposed amendments (Proposed Amendments) to Ontario Securities Commission Rule 48-501 *Trading during Distributions, Formal Bids and Share Exchange Transactions* (Rule 48-501) and consequential changes (Proposed Changes)to the Companion Policy to Rule 48-501 (48-501CP) for a 90-day comment period, ending September 3, 2025. The Proposed Amendments prohibit any person or company who made a short sale (described below) of a security during the period commencing five business days before pricing of a prospectus offering or private placement of the same class of securities sold short from buying securities in the offering unless an exemption is available. The purchase of securities in the offering is prohibited even if: - the short seller had no prior knowledge of the offering; - or the offering did not constitute a “material fact” or “material change” (either, material information**)** concerning the issuer; and, - the short sales had no impact on the market price of the securities sold. The Proposed Amendments are [*available for download*](https://www.osc.ca/en/securities-law/instruments-rules-policies/4/48-501/notice-request-comment-proposed-amendments-osc-rule-48-501-trading-during-distributions-formal) from the websites of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Appointment to the OSC Small and Medium Enterprises Committee](https://baxsecuritieslaw.com/2014729appointment-to-the-osc-small-and-medium-enterprises-committee/) **Published:** July 28, 2014 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission announced today that it has appointed Barbara to its Small and Medium Enterprises Committee (SMEC).The purpose of SMEC is to advise OSC staff on matters related to small and medium enterprises (SMEs), including the challenges they face in operating their businesses... **Content:** The Ontario Securities Commission announced today that it has appointed Barbara to its Small and Medium Enterprises Committee (SMEC). The purpose of SMEC is to advise OSC staff on matters related to small and medium enterprises (SMEs), including the challenges they face in operating their businesses and raising capital. OSC staff recognize the contribution of SMEs, including both private companies and venture issuers, to economic growth and job creation in Ontario. The appointment is for a one year term. **Categories:** News & Updates --- ### [Ownership Through Equity Participation for First Nations](https://baxsecuritieslaw.com/2014824ownership-through-equity-participation-for-first-nations/) **Published:** September 7, 2013 **Author:** Barbara Hendrickson **Excerpt:** October 24, 2013 12:00 EST OnlineThe Canadian Bar Association, Business Law Section webinar will focus on the role of equity participation in the IBA process and, generally, in enterprises involving Aboriginal Lands and First Nations participants. There will also be a focus on options for... **Content:** October 24, 2013 12:00 EST Online The Canadian Bar Association, Business Law Section webinar will focus on the role of equity participation in the IBA process and, generally, in enterprises involving Aboriginal Lands and First Nations participants. There will also be a focus on options for equity participation for First Nations in projects relating to renewable energy, exploration and mining. Speakers: Barbara Hendrickson BAX Securities Law, Patricia Stirbys, Barrister & Solictor **Categories:** News & Updates --- ### [Proposed Cooperative Capital Markets Regulator](https://baxsecuritieslaw.com/2014824proposed-cooperative-capital-markets-regulator/) **Published:** September 29, 2013 **Author:** Barbara Hendrickson **Excerpt:** On September 19, 2013, the Ministers of Finance of British Columbia, Ontario and Canada agreed to establish a cooperative capital markets regulatory system and invite all provinces and territories to participate in the proposed system.The cooperative securities regulator will feature a single regulator administering a... **Content:** On September 19, 2013, the Ministers of Finance of British Columbia, Ontario and Canada agreed to establish a cooperative capital markets regulatory system and invite all provinces and territories to participate in the proposed system. The cooperative securities regulator will feature a single regulator administering a single set of regulations and be operationally independent and self-funded through a single set of fees. It will be directed by an expert board of independent directors with broad capital markets-related expertise. A Council of Ministers of all participating jurisdictions will oversee the cooperative system. The regulator will have an executive head office in Toronto and a nationally integrated executive management team to serve market participants in all participating jurisdictions. **Categories:** News & Updates --- ### [The Ontario Securities Commission is considering new exemptions](https://baxsecuritieslaw.com/2014824the-ontario-securities-commission-is-considering-new-exemptions/) **Published:** August 29, 2013 **Author:** Barbara Hendrickson **Excerpt:** On August 29, 2013 the Ontario Securities Commission (“OSC”) published a notice which indicated that they are considering the following new or expanded exemptions from the prospectus requirements:1. Crowdfunding exemptionCrowdfunding is a term used to describe a method of raising small amounts of money from... **Content:** On August 29, 2013 the Ontario Securities Commission (“OSC”) published a notice which indicated that they are considering the following new or expanded exemptions from the prospectus requirements: 1\. Crowdfunding exemption Crowdfunding is a term used to describe a method of raising small amounts of money from many people over the internet through a website known as a portal The OSC is developing a crowdfunding framework for Ontario. To protect investors we plan to limit how much they can invest at one time and during a year through crowdfunding. A company would be limited to raising $1.5 million through a registered portal. Investors would be limited to an investment of $2,500 in a single investment and $10,000 annually. 2\. Family, friends and business associates exemption Other provinces in Canada have a family, friends and business associates exemption and Ontario is considering extending that exemption to the Ontario markets. Under the exemption, family members, close personal friends or close business associates of the directors, executive officers or control persons of the company or its affiliates would be able to invest without a prospectus. 3\. Offering memorandum exemption An offering memorandum (OM) exemption is available everywhere in Canada except Ontario. This would allow a company to sell its shares without a prospectus if it provided an OM to the investor. The OSC intends to develop a proposal for an OM exemption that is based on the OM exemption currently available in Alberta. The OSC is considering limitingthe size of investment if not a public company. 4\. Streamlined rights offering exemption The OSC is working with the securities regulators in the other provinces to see if the existing rights offering exemption available across Canada can be streamlined to improve its efficiency and effectiveness for public companies without compromising investor protections. These changes would include shorter review and exercise periods; dilution exceeding 25% and electronic delivery of documents to shareholders. **Categories:** News & Updates --- ### [Canadian Securities Administrators (“CSA”) Consultation Paper 54-401 Review of the Proxy Voting Infrastructure](https://baxsecuritieslaw.com/2014824canadian-securities-administrators-csa-consultation-paper-54-401-review-of-the-proxy-voting-infrastructure/) **Published:** August 15, 2013 **Author:** Barbara Hendrickson **Excerpt:** On August 15, 2013 the CSA published a Consultation Paper focused on issues that are directly related to the accuracy, transparency and integrity of the proxy voting infrastructure for a 90-day comment period. The Paper outlines and seeks feedback on a proposed approach to address... **Content:** On August 15, 2013 the CSA published a Consultation Paper focused on issues that are directly related to the accuracy, transparency and integrity of the proxy voting infrastructure for a 90-day comment period. The Paper outlines and seeks feedback on a proposed approach to address concerns regarding the integrity and reliability of the proxy voting infrastructure and identified two issues which have the most potential to impact the ability of the proxy voting infrastructure to function accurately and reliably. These issues are: 1\. Is accurate vote reconciliation occurring within the proxy voting infrastructure? Vote reconciliation refers to the process by which proxy votes from registered shareholders and voting instructions from beneficial owners of shares are reconciled against the securities entitlements in the intermediated holding system. There are two main reconciliation challenges. First, the intermediated holding system results in one share having multiple associated entitlements. Unless there is an effective system of reconciliation, there is a risk that valid proxy votes submitted to the tabulator ultimately are discarded because they cannot be properly matched to an appropriate omnibus proxy or registered position. Second, share lending creates a risk that the same share could be voted multiple times. The CSA wants to better understand whether the proxy voting infrastructure adequately addresses these vote reconciliation challenges. 2\. What type of end-to-end vote confirmation system should be added to the proxy voting infrastructure? End-to-end vote confirmation refers to a communication provided to shareholders that their proxy votes and voting instructions have been properly transmitted by the intermediaries, received by the tabulator and tabulated as instructed. Currently, the proxy voting infrastructure does not contain an end-to-end vote confirmation system for beneficial owners of shares, although efforts are underway to develop such functionality. Potentially the lack of such functionality can undermine confidence in the accuracy and reliability of proxy voting results. The CSA will review the current development status of an end-to-end vote confirmation system, as well as consider what features such a system should incorporate. The comment period will end on November 13, 2013. **Categories:** News & Updates --- ### [BAX Bulletin - CSA Propose Amendments to the Early Warning Regime](https://baxsecuritieslaw.com/2014824bax-bulletin-csa-propose-amendments-to-the-early-warning-regime/) **Published:** July 5, 2013 **Author:** Barbara Hendrickson **Excerpt:** On March 13, 2013 the Canadian Securities Administrators (CSA) published for comment proposed amendments to National Instrument 62-103 Early Warning System and Related Take-Over Bid and Insider Reporting Issues (NI 62-103) (Proposed Amendment). The objective of the Proposed Amendment is to provide greater transparency about... **Content:** On March 13, 2013 the Canadian Securities Administrators (CSA) published for comment proposed amendments to National Instrument 62-103 Early Warning System and Related Take-Over Bid and Insider Reporting Issues (NI 62-103) (Proposed Amendment). The objective of the Proposed Amendment is to provide greater transparency about significant holdings of issuers’ securities by proposing an early warning reporting threshold of 5%, requiring disclosure of both increases and decreases in ownership of 2% or more of securities, and enhancing the content of the disclosure in the early warning news releases and reports required to be filed. The proposing changes also require that certain “hidden ownership” and “empty voting” arrangements are disclosed. Currently the early warning threshold is 10%. Comprehensive reforms to the alternative monthly reporting (AMR) framework in NI 62-103 applicable to eligible institutional investors (EIIs) are not being proposed. However, some of the Proposed Amendments will apply to an EII reporting under the AMR regime and we propose a change to the criteria for disqualification from AMR. **Categories:** News & Updates --- ### [Indigenous/Aboriginal Equity Participation in Mineral Exploration - Prospectors & Developers Association of Canada (PDAC) International Convention, Trade Show & Investors Exchange March 4, 2014](https://baxsecuritieslaw.com/2014824indigenousaboriginal-equity-participation-in-mineral-exploration-prospectors-developers-association-of-canada-pdac-international-convention-trade-show-investors-exchange-march-4-2014/) **Published:** January 14, 2014 **Author:** Barbara Hendrickson **Excerpt:** Chair: Barbara Hendrickson, CEO, Securities Partner (BAX Securities Law) and PDAC Board MemberMarch 4, 2014 3:30 pm – 5:00 pm: Indigenous/Aboriginal equity participation in mineral explorationIn addition to employment, business development and revenues, indigenous people around the world are increasingly interested in taking equity stakes... **Content:** Chair: Barbara Hendrickson, CEO, Securities Partner (BAX Securities Law) and PDAC Board Member **March 4, 2014 3:30 pm – 5:00 pm: Indigenous/Aboriginal equity participation in mineral exploration** In addition to employment, business development and revenues, indigenous people around the world are increasingly interested in taking equity stakes in exploration and mining projects and companies. This can generate enhanced economic opportunities for indigenous communities as well as generate new sources of capital for exploration and mining companies. Don Richardson, Managing Partner, Shared Value Solutions: *“Creating Shared Value between Exploration and Mining Companies and Aboriginal Communities including Revenue Sharing and Equity Participation”* Ian Brodie Brown, President & CEO, AurCrest Gold Resources Inc .and Christopher Angeconeb, Business Manager, Lac Seul First Nation and Director, AurCrest Gold Resources Inc.: *“Lac Seul First Nation Equity Participation Model in the Mineral Sector”* Rob Miller, Partner Miller Titerle LLP and Annita McPhee, President of the Tahltan Central Council and PDAC Board Member *“Arrangements with First Nations – Model Structures”* **Location: Room 711 Metro Toronto Convention Centre 222 Bremner Blvd. Toronto, ON Canada (open to all attendees of Convention)** **Categories:** News & Updates --- ### [BAX Bulletin - Crowdfunding & other recent proposed capital raising prospectus exemptions](https://baxsecuritieslaw.com/2014824bax-bulletin-crowdfunding-other-recent-proposed-capital-raising-prospectus-exemptions/) **Published:** April 2, 2013 **Author:** Barbara Hendrickson **Excerpt:** The following is a brief summary reviewing crowdfunding and other capital raising prospectus exemptions proposed by the Ontario Securities Commission (OSC). “Crowdfunding” refers to the process by which many investors of small amounts of funds come together to finance organizations with limited access to conventional... **Content:** The following is a brief summary reviewing crowdfunding and other capital raising prospectus exemptions proposed by the Ontario Securities Commission (OSC). “Crowdfunding” refers to the process by which many investors of small amounts of funds come together to finance organizations with limited access to conventional sources of capital. To date, North American “crowd financiers” have been limited to receiving rewards other than securities for their contributions. However, North American regulators are at various stages of enacting rules that would permit such prospectus-exempt issuances of securities. In the U.S., while the JOBS Act calls for the SEC to promulgate crowdfunding rules, such a financing method will only be available to private companies. In contrast the OSC has proposed, in Staff Consultation Paper 45-710, that crowdfunding be available to reporting and non-reporting issuers alike. The issuer would be limited to raising $1.5 million per year using the exemption. Further, the investor would be limited to investing $2,500 per investment and no more than $10,000 per year using the exemption. While crowdfunding would require the use of a registered dealer/adviser’s online portal, the OSC is concurrently considering an “offering memorandum” exemption, with otherwise similar criteria, that would require no such intermediary. While the prospective crowdfunding exemption may be of limited use to the mineral exploration and development industry, it is not the only new exemption being proposed by the OSC. Pursuant to the “sophisticated investor” exemption, a non-accredited investor with a year of relevant work experience and a CFA, CIM or MBA could participate in a prospectus-exempt issuance. The OSC is also considering exempting issuances made to an investor who is acting on the advice of an investment dealer. **Categories:** News & Updates --- ### [American Bar Association (ABA), Business Law Section 2014 Business Leaders Conference, Innovative Bar Programs , May 16, 2014, Chicago](https://baxsecuritieslaw.com/201462american-bar-association-aba-business-law-section-2014-business-leaders-conference-innovative-bar-programs-may-16-2014-chicago/) **Published:** February 13, 2014 **Author:** Barbara Hendrickson **Excerpt:** Barbara will present to the ABA Business Leaders Conference on the Canadian Bar Association’s (CBA) Futures Committee’s initiative on May 16, 2014 in Chicago. The ABA Business Leader’s Conference brings together American and International bar business law leaders to meet, share ideas, and learn how... **Content:** Barbara will present to the ABA Business Leaders Conference on the Canadian Bar Association’s (CBA) Futures Committee’s initiative on May 16, 2014 in Chicago. The ABA Business Leader’s Conference brings together American and International bar business law leaders to meet, share ideas, and learn how the ABA and other organizations such as the CBA fulfill their mission and best serve their members. The Futures Committee was formed by the CBA in 2004 to examine the challenges facing lawyers and the legal profession and to make recommendations about the kind of organization the CBA should be in 2014 and what it needs to offer lawyers and the legal profession to be relevant and vibrant. **Categories:** News & Updates --- ### [BAX Bulletin - New Notice and Access Available for the 2013 Proxy Season](https://baxsecuritieslaw.com/2014824bax-bulletin-new-notice-and-access-available-for-the-2013-proxy-season/) **Published:** March 12, 2013 **Author:** Barbara Hendrickson **Excerpt:** Effective February 11, 2013, the Canadian Securities Administrators amended National Instrument 54-101 – Communication with Beneficial Owners of Securities of a Reporting Issuer (“NI 54-101”) and National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”) which introduced the "notice-and-access" procedure (described in more detail below),... **Content:** Effective February 11, 2013, the Canadian Securities Administrators amended National Instrument 54-101 – Communication with Beneficial Owners of Securities of a Reporting Issuer (“NI 54-101”) and National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”) which introduced the “notice-and-access” procedure (described in more detail below), the simplification of the appointment procedure for beneficial owners as proxy holders and enhanced disclosure requirements regarding the beneficial owner voting process. Notice-and-access may be used for both management and non-management proxy solicitations. The CSA’s amendments give issuers the possibility, for meetings held on or after March 1, 2013, of delivering trimmed-down notice packages (rather than a full set of paper proxy-related materials) that provide details of where to access online proxy-related materials or order printed materials. **Notice-and-Access** Under the notice-and-access regime, a reporting issuer may deliver proxy-related materials by posting the relevant information circular or, if appropriate, other materials, on SEDAR and an alternate website. The issuer must also send a notice informing registered holders and beneficial owners that such materials have been posted electronically and how to access them. Under the new process, the notice provided to shareholders may be sent by mail or electronically, provided that prior consent has been obtained. The notice must contain certain specified information, including the time and place of the meeting, the matters to be voted on, where to find the proxy-related materials and how to obtain a paper copy of the information circular or other documents. Beneficiaries may give standing instructions to their intermediaries to obtain paper copies whenever an issuer uses notice-and-access. **Beneficial Owner Proxy Appointment** The amendments simplify the process by which beneficial owners are appointed as proxies by giving issuers and intermediaries more flexibility to determine their own specific arrangements. Management or the intermediary must appoint a non-objecting beneficial owner (“NOBO”) or its nominee as a proxy holder if the NOBO has so instructed management in any written form. The NOBO or nominee must be given authority to attend, vote and otherwise act for management in respect of all matters at the meeting, unless giving such authority is prohibited by corporate law (such as s. 153 of the CBCA). **Categories:** News & Updates --- ### [Canadian Securities Regulators propose changes to the accredited investor and minimum amount investment prospectus exemptions](https://baxsecuritieslaw.com/201462canadian-securities-regulators-propose-changes-to-the-accredited-investor-and-minimum-amount-investment-prospectus-exemptions/) **Published:** March 24, 2014 **Author:** Barbara Hendrickson **Excerpt:** On February 27, 2014, the Canadian Securities Administrators published for comment proposed amendments relating to the accredited investor prospectus exemption and the minimum amount investment prospectus exemption in National Instrument 45-106 Prospectus and Registration Exemptions.The proposed amendments include, among other things:Individual accredited investors unless they have... **Content:** On February 27, 2014, the Canadian Securities Administrators published for comment proposed amendments relating to the accredited investor prospectus exemption and the minimum amount investment prospectus exemption in [National Instrument 45-106 Prospectus and Registration Exemptions](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20140227_45-106_rfc-pro-amendments.htm). The proposed amendments include, among other things: - 1. Individual accredited investors unless they have financial asserts over $5 million will be required to complete and sign a new risk acknowledgement form, Form 45-106F9 Risk Acknowledgement Form for Individual Accredited Investors. 2. Form 45-106F9 describes, in plain language, the categories of individual accredited investor and the protections an investor is renouncing by purchasing under the exemption. 3. The investor would be required to indicate on the Form 45-106F9 which category of accredited investor they satisfy 4. Any salesperson or finder, whether registered or not, involved in the trade to the individual investor would be required to complete and sign Form 45-106F9. 5. Additional guidance will be added to the Companion Policy on the steps issuers should take to verify accredited investor status, including explaining the different tests and asking questions to obtain factual information from purchasers about their income or assets before discussing the investment. 6. The definition of accredited investor would be amended to include family trusts established by an accredited investor for his or her family, provided the majority of trustees of the family trust are accredited investors. 7. Issuers will be required to identify the category of accredited investor of each purchaser in the report of exempt distribution (Form 45-106F1 and, in BC, Form 45-106F6). 8. The OSC will amend the definition of accredited investor to allow fully managed accounts to purchase investment fund securities in Ontario, 9. The report of trade form (Form 45-106F1 and, in BC, Form 45-106F6) will add the category of accredited investor for each purchaser; updated industry categories; more information on any person being compensated in connection with the distribution, including identifying which purchasers the person was compensated for. The comment period closes on May 28, 2014. **Categories:** News & Updates --- ### [Saskatchewan – the First of the Canadian Provinces to bring in Crowdfunding December 6, 2013](https://baxsecuritieslaw.com/2014824saskatchewan-the-first-of-the-canadian-provinces-to-bring-in-crowdfunding-december-6-2013/) **Published:** February 5, 2014 **Author:** Barbara Hendrickson **Excerpt:** On December 6, 2013 the Saskatchewan Financial and Consumer Affairs Authority (FCAA) became the first province in Canada to offer small businesses and start-upsincluding companies and limited partnership (“Issuers”) a method to raise funds in a cost effective way through the introduction of General Order... **Content:** On December 6, 2013 the Saskatchewan Financial and Consumer Affairs Authority (FCAA) became the first province in Canada to offer small businesses and start-upsincluding companies and limited partnership (“Issuers”) a method to raise funds in a cost effective way through the introduction of General Order 45-925 Saskatchewan Equity Crowdfunding Exemption (“Crowdfunding Exemption”). Requirements for Companies wishing to raise funds through Crowdfunding: The offering must be made through a crowdfunding website or “portal” where investors may purchase the securities including debt securities such as promissory notes and equitysuch as shares. As long as the Issuer is not in the business of trading in securities they do not have to be registered with the FCAA to raise funds. The exemption is not open to Issuers that are reporting issuers or public companies and a company is restricted to two offerings per year. An Issuer cannot run two offerings for the same company at the same time. Issuers and the investors must be Saskatchewan residents. The offering must be of the Issuer’s own securities and investment fund securities and derivative securities are not eligible for the Exemption. Issuers can only raise a maximum of $150,000 per offering or $300,000 in a 12 month period under the Crowdfunding Exemption. An investor cannot invest more than $1500 per offering and no offering can last for more than six months. The issuer is required to set a minimum offeringamount and funds raised must be held in trust until the minimum is raised. No commissions can be paid to sell securities through the Crowdfunding Exemption. Issuers are required to prepare an Offering Document which informs investors of certain things: - contact details for the Issuer; - legal structure of the Issuer’s business; - where investors can obtain the organizing documents of the Issuer; - a description of the business including who the Issuer’s competitors are; any milestones accomplished; - where the business will be in three, five and ten years; - amount of money raised to date and what that money was used for; - experience of the Issuer’s management team; - description of the use of proceeds; - details of the type and nature of the securities being sold and the price per security; - description of the rights of investors who purchase the securities; - how the Issuer intends to report to investors in the future; and - therisks of the investment and how the Issuer plan to mitigate the risks. Investors must confirm online that they have read and understood the “Important Risk Warnings”. Issuers must provide certain contact info and confirmation of trades to investors within 15 minutes of closing of the offering. There is no requirement for financial statements and if financial statements are provided there are no rules for how they are to be prepared. Issuers will be required to discuss the Issuer’s current financial condition re debts; assets solvency etc. in the Offering Document. Investors must certify that they have read the offering document and the warnings mandated by the FCAA. Investors have statutory rights of rescission and to damages under theSaskatchewan Securities Act. Issuers will be required to file the following forms with the FCAA to rely on the Crowdfunding Exemption: - Issuer Information Form GO45-925F2; - Individual Information Form GO45-924F2 for each officer, director, promoter and control person of the Issuer; and - Offering Document Form GO45-925F1 Ten days after the above forms are filed – selling under the Offering can commence. Within 30 days of completing the offering aReport of Trade Form (GO 45-925F4) must be filed with the FCAA. Requirements for Crowd Funding Websites / Portals There are no registration requirements for websites or “portals” on which the offerings are posted however the FCAA does impose a number of obligations on websites providers. The website provider must ensure that: - Issuers and investors have Saskatchewan addresses; - eachIssuer raises no more than $300,000 per year through the Crowdfunding Exemption; - offerings do not exceed 6 months; - Issuers only have two offerings per year; - investors do not invest more than $1500 per offering; - that the offering documents meet the FCAA requirements; - investors sign the appropriate certifications; - the website provider is independent of any Issuers raising money on the website; - all funds raised are held in trust until the minimum offering is met; The website provider must provide Issuers with the required investor information (name, address, phone number, email address, details of purchase) within 15 days of the end of the offering. The website provider can charge a fee for its services.Thirty days before the website goes live the website provider will have to submit the following forms to the FCAA: - Portal Information Form GO45-925F5 - Portal Individual Information Form GO45-925F6 for each officer, director, promoter and control person of the website provider. There is no requirement for approval from the FCAA and once the 30 days is up the website can begin to operate. There is no limit on promoting the website but the Portal website provider cannot promote Issuersselling their securities. Proposed Crowdfunding Exemption in Ontario On December 14, 2012 the Ontario Securities Commission (“OSC”) discussed a proposal for a crowdfunding exemption in its “OSC Staff Consultation Paper 45-710 Considerations for New Capital Raising Prospectus Exemptions”. Under the OSC model the website providers / portals would require registration with the OSC under an existing category of registration. The OSC will consider providing exemptions from specific dealer and advisor registration requirements. Some of the highlights of the Ontario model are as follows: - Issuer could raise $1.5 million in any 12 month period; - additional restrictions on types of equity and debt to be issued; - investors can only invest $2500 per company and $10,000 per calendar year; - open to reporting issuers; - disclosure must be certified by Issuers; - limits on Issuer’s advertising to the portals and social media; - no need for audited financial statements unless the raise is over $500,000 or if the Issuer is reporting issuer. Non audited statements need to be certified by management; - investors will get a statutory right of rescission and to damages; - investors will get a two day cooling off period; - special risk acknowledgement form; and - Issuer must provide investors with ongoing financial statements and keep prescribed books and records. On August 28, 2013 the OSC published “OSC Notice 45-712 Progress Report on Review of Prospectus Exemptions to Facilitate Capital Raising” where they reported that they are continuing to consider the crowdfunding concept. Crowdfunding in the Unites States On October 23, 2013 the US Securities Exchange Commission announced new crowdfunding rules as required by Title III of the JOBS Act. Those proposals will be discussed in a separate article. **Categories:** News & Updates --- ### [Disclosure Requirements Regarding Women on Boards and in Senior Management](https://baxsecuritieslaw.com/2014824disclosure-requirements-regarding-women-on-boards-and-in-senior-management/) **Published:** August 2, 2013 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) recently announced a request for comments on OSC Staff Consultation Paper 58-401 Disclosure Requirements Regarding Women on Boards and in Senior Managementon a new proposal which would require TSX-listed companies to provide disclosure regarding women on boards and in senior management in... **Content:** The Ontario Securities Commission (OSC) recently announced a request for comments on *OSC Staff Consultation Paper 58-401 Disclosure Requirements Regarding Women on Boards and in Senior Managementon* a new proposal which would require TSX-listed companies to provide disclosure regarding women on boards and in senior management in Ontario. According to statistics, women continue to be underrepresented on boards and in positions of senior management in Canada. The OSC is considering possible amendments to National Instrument 58-101Disclosure of Corporate Governance Practices, which currently makes no mention of gender in its requirements for disclosure on board composition. Under the OSC’s potential disclosure model, TSX-listed companies (and other non-venture issuers) would provide disclosure as part of their annual summary of corporate governance practices in areas such as: - their policies regarding female representation on their boards and in senior management, - consideration of the representation of women in the director selection process, - certain quantitative information regarding the representation of women in the organization, on the board and in senior management. The purpose of the Paper is to get feedback from investors, issuers, other market participants and advisors. **Categories:** News & Updates --- ### [Canadian Bar Association Newsletter Message from the Chair](https://baxsecuritieslaw.com/2014824canadianbarassociationnewslettermessagefromthechair/) **Published:** June 4, 2014 **Author:** Barbara Hendrickson **Excerpt:** By Barbara HendricksonThe current traditional partnership structures for law firms have been in place for hundreds of years and are enshrined in legislation. Currently the legal profession and our regulators are examining alternative business structures including ones where non-lawyers can be owners of law firms.... **Content:** By Barbara Hendrickson The current traditional partnership structures for law firms have been in place for hundreds of years and are enshrined in legislation. Currently the legal profession and our regulators are examining alternative business structures including ones where non-lawyers can be owners of law firms. Lawyers tend to be split on the desirability of such a move, raising concerns both about the protection of the public interest and the erosion of the current legal monopoly that lawyers have in Canada. A number of other Commonwealth jurisdictions are ahead of the curve on this trend including England, Wales and Australia. The subject of alternative business structures (“ABS”) is being considered by Canadian Bar Association through its Legal Futures Initiative. The CBA is set to release its final report in August of this year, which among other things will make recommendations on ABS. The final report is the last step of a multi-phase project which has consisted of initial research and analysis which resulted in a 2012 preliminary report identifying trends and issues, followed by consultations which wrapped up earlier this year and in which ABS were a point of contention. The Legal Futures Initiative has a number of teams, including a Business Structures and Innovation Team, which focused on various business models including non-legal management, public ownership and non-partnership arrangements. The CBA is expected to recommend that provincial law societies consider alternative business structures with the guiding principle that any structure is acceptable as long as the model is consistent with the preservation of core professional principles in the delivery of services to the client including privilege, loyalty and avoidance of conflicts. The Law Society of Upper Canada is also examining the issue of ABS. The LSUC Alternative Business Structures Working Group, in a report delivered to Convocation on Feb. 27, 2014, has recommended that non-lawyers be able to own at least a portion of law firms. The LSUC report has concluded that there is no evidence that the regulatory liberalization will cause harm. The report outlined four different models for further study: Entities that provide exclusively legal services and in which non licensees are permitted to own up to 49 per cent; Entities that provide exclusively legal services and in which there are no restrictions on non-licensee ownership; Entities that provide both legal and non legal services (unless those services are identified as posing a regulatory risk) and in which non licensee owners are permitted a ownership share of up to 49 per cent; Entities which provide legal and non legal services (except those that are identified as posing a regulatory risk) and in which there are no restrictions on non licensee ownership. Currently other Canadian jurisdictions including Nova Scotia and British Columbia are examining the desirability of ABS and in Quebec non-lawyers are already allowed to own a stake in a legal firm. The idea of a law firm being a public company is intriguing. The world’s first publicly traded law firm, Slater & Gordon, is headquartered in Melbourne, Australia. Slater & Gordon Ltd. has been public since 2007 when it listed on the Australian Stock Exchange. Australia has permitted investment in law firms since 2001. Slater & Gordon is a full service law firm providing legal services in 30 areas from family and criminal law to corporate and securities laws. Slater & Gordon has a number of unique features, including a call centre which fields nearly 100,000 calls per year and where may law students begin their careers. Data on current and potential clients is collected and analyzed for cross-selling purposes. Data is also collected to create fixed-fee pricing structures. There is no partnership to be a part of – lawyers are advanced based on a “balanced scorecard” that is a combination of financial performance (the firm’s and the lawyer’s); contributions to brand and marketability; contributions to mentoring and developing others within the law firm; and contributions to the intellectual capacity of the firm. Slater & Gordon has an external board of directors, which is said to bring a different perspective to decision-making and strategy. Slater & Gordon traded at a share price of AUSD$1.000 when it was listed in May of 2007 on the ASX and closed at AUSD$4.66 on May 13, 2014. That could be our future. *Barbara Hendrickson is securities partner BAX Securities Law* [http://www.cba.org/CBA/sections\_business/newsletters2014/rules.aspx](http://www.cba.org/CBA/sections_business/newsletters2014/rules.aspx) **Categories:** News & Updates --- ### [New Prospectus Exemption for TSXV Issuers for Sales to Existing Shareholders](https://baxsecuritieslaw.com/2014824new-prospectus-exemption-for-tsxv-issuers-for-sales-to-existing-shareholders/) **Published:** November 22, 2013 **Author:** Barbara Hendrickson **Excerpt:** MI 45-312 Prospectus Exemption for Distributions to Existing Security Holders (“Proposed MI 45-312”)The securities commissions in all of the Canadian provinces except Ontario and Newfoundland published Proposed MI 45-312 for comment on November 21, 2013 which would, subject to certain conditions, allow issuers listed on the... **Content:** MI 45-312 Prospectus Exemption for Distributions to Existing Security Holders **(“Proposed MI 45-312”)** The securities commissions in all of the Canadian provinces except Ontario and Newfoundland published Proposed MI 45-312 for comment on November 21, 2013 which would, subject to certain conditions, allow issuers listed on the TSX Venture Exchange **(“TSXV”)** to raise money by sellingshares to their existing shareholders (holding securities as of a specific record date). Proposed MI 45-312 would be in addition to the most common prospectus exemptions currently being used in Canada: accredited investor exemption; offering memorandum; rights offering; and TSXV short form offering document. TSXV data indicates that TSX V issuers do not generally use any of these exemptions to raise capital from retail investors and that, after the initial public offering, TSXV issuers rarely conduct prospectus offerings. The TSX V reports that TSXV issuers are not using prospectus exemptions to sell to retail investors because of the time and cost involved in preparing the required prospectus documents. The proposed exemption has the following key conditions: • the issuer must have a class of equity securities listed on the TSXV; • the issuer must have filed all timely and periodic disclosure documents as required under applicable securities laws; • the offering can consist only of the class of equity securities listed on the TSXV or units consisting of the listed security and a warrant to acquire the listed security; • the issuer must issue a news release disclosing the proposed offering, including details of the use of proceeds; • each investor must confirm in writing to the issuer that as at the “record date” the investor held the type of listed security that the investor is acquiring under the proposed exemption; • unless the investor has obtained advice regarding the suitability of the investment from a registered investment dealer, the aggregate amount invested by the investor in the last 12 months under the proposed exemption is not more than $15,000; • an investor must be provided with certain rights of action in the event of a misrepresentation in the issuer’s continuous disclosure record; and • although an offering document is not required, if an issuer voluntarily provides one, an investor will have certain rights of action in the event of a misrepresentation in it. The first trade of securities issued under the proposed exemption will be subject to resale restrictions under section 2.5 of National Instrument 45-102 Resale of Securities like most other capital raising prospectus exemptions. In addition, issuers will have to file a report of exempt distribution within 10 days after each distribution under the proposed exemption. There is no corresponding exemption from the dealer registration requirement. Under Proposed MI 45-312, aTSXV issuer is not required to provide prospective investors with a disclosure document, other than an offering news release. Issuers will be required to represent to prospective purchasers in the subscription agreement that there are no material facts or material changes relating to the issuer that have not been generally disclosed. Existing security holders will only be able to invest up to $15,000 unless they receive suitability advice from a registered investment dealer. Under the Proposed MI 45-312 either statutory or contractual secondary market civil liability provisions will apply. The comment period is open until January 20, 2014. **Categories:** News & Updates --- ### [Proposed amendments to facilitate private placements into Canada](https://baxsecuritieslaw.com/2014824proposed-amendments-to-facilitate-private-placements-into-canada/) **Published:** November 29, 2013 **Author:** Barbara Hendrickson **Excerpt:** Proposed Multilateral Instrument 45-107 Listing Representation and Statutory Rights of Action Disclosure Exemptions (“Proposed MI 45-107”)On November 28, 2013 all of the members of the Canadian Securities Administrators (“CSA”), other than the securities commissions in Ontario and British Columbia (“participating jurisdictions”), published proposed Multilateral Instrument 45-107 Listing... **Content:** **Proposed Multilateral Instrument 45-107 Listing Representation and Statutory Rights of Action Disclosure Exemptions (“Proposed MI 45-107”)** On November 28, 2013 all of the members of the Canadian Securities Administrators **(“CSA”),** other than the securities commissions in Ontario and British Columbia (“participating jurisdictions”), published proposed Multilateral Instrument 45-107 Listing Representation and Statutory Rights of Action Disclosure Exemptions **(“Proposed MI 45-107”)**. Proposed MI 45-107 is not being proposed in Ontario and British Columbia as in those jurisdictions existing or proposed instruments address or are expected to address the issues discussed below.**¹** Proposed MI 45-107 proposes exemptions from certain requirements of the securities legislation of the participating jurisdictions that apply in the context of prospectus exempt financings, conducted by issuers and by investment dealers or international dealers acting as underwriters, offered to institutional and other sophisticated investors in Canada. The purpose of proposed MI 45-107 is two-fold: First, in the context of the international financings, it provides an exemption from the statutory prohibition against making a representation about the intention to list securities on an exchange or market. Second, it provides an exemption from the requirement that applies in some of the participating jurisdictions, that an offering document used in connection with a prospectus exempt distribution include a prescribed statement with respect to certain statutory rights of action. Proposed MI 45-107 will codify certain discretionary exemptive relief that the CSA has been granting in the context of U.S. and international offerings of securities to Canadian institutional and other sophisticated investors and consequently alleviate the need for these discretionary exemption applications. Listing representation prohibition Currently the participating jurisdictions have certain prohibitions on listing representations that prohibit a person or company, with the intention of effecting a trade in a security, from making a representation that the security will be listed on an exchange or quoted on a quotation and trade reporting system, or that application has been or will be made to list the security, unless consent or authorization, as applicable, is first obtained (the listing representation prohibition). Certain exceptions to this prohibition currently exist in most participating jurisdictions. These include: - where an application has already been made to list or quote the securities and other securities of the same issuer are already listed on an exchange or quoted on a quotation and trade reporting system, or - where the exchange or quotation and trade reporting system has granted approval to the listing or quoting of the securities, conditional or otherwise, or has consented to, or indicated that it does not object to, the representation. - Proposed MI 45-107 would provide an exemption from the listing representation prohibition provided that the offering is an offering of “designated foreign securities” made only to “permitted clients”. Designated foreign securities are defined in proposed MI 45-107 as securities offered primarily in a foreign jurisdiction that are either: - issued by an issuer that is incorporated, formed or created under the laws of a foreign jurisdiction; is not a reporting issuer in a jurisdiction of Canada, has its head office outside of Canada, andhas a majority of its executive officers and directors resident outside of Canada; - securities that are issued or guaranteed by the government of a foreign jurisdiction.The term “permitted client” has the same meaning as in NI 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations.**²** Offering document disclosure Securities legislation in certain of the participating jurisdictions requires that where an “offering memorandum” (as defined in the securities legislation of those jurisdictions) is provided to a prospective purchaser in connection with a distribution to which statutory rights of action apply, these statutory rights must be described in the offering memorandum (the statutory rights of action disclosure requirement). Where an offering memorandum contains a misrepresentation, a purchaser who purchased a security offered by the offering memorandum during the period of distribution has a right of action for damages or rescission against the issuer or selling security holder. Proposed MI 45-107 would provide an exemption from the statutory rights of action disclosure requirement in the following circumstances: - The offering is an offering of “designated foreign securities” - It is made only to “permitted clients”, and - Certain alternative disclosure of these rights of action is provided. The exemption from the statutory rights of action disclosure requirement is conditional on the disclosure being provided in alternative ways. The disclosure can be provided in a one-time notice that has been delivered to the permitted client by an investment dealer or international dealer acting as underwriter that is signed by the permitted client. This notice will explain that, with respect to the current and future distributions of designated foreign securities by the foreign issuer, the purchaser will have certain statutory rights in the event of a misrepresentation. In the case of a one-time notice, a description of such rights will not be provided at the time of each offering of designated foreign securities by the foreign issuer to the purchaser. Proposed MI 45-107 does not affect the statutory rights of action available to purchasers of securities in the applicable jurisdictions. The effect of the Proposed MI 45-107 is to eliminate the need for a “wrapper” setting out the Canada specific disclosure in the foreign offering document. The comment period closed on February 26, 2014. . The CSA is also proposing amendments to NI 33-105 Underwriting Conflicts (“NI 33-105”) to provide relief, in the context of these same U.S. and international offerings to institutional and other sophisticated investors, from the requirement in NI 33-105 to provide disclosure relating to connected and related issuers in a prospectus-exempt disclosure document. The proposed exemption from NI 33-105 will only apply where offerings by foreign issuers provide comparable alternative disclosure to purchasers. **Categories:** News & Updates --- ### [Crowd Funding – New Developments](https://baxsecuritieslaw.com/201462hyxyytau5r5mc8jkkif8cr9x0hl0vy/) **Published:** April 10, 2014 **Author:** Barbara Hendrickson **Excerpt:** On March 20, 2014, the Autorité des marchés financiers, the Financial and Consumer Affairs Authority of Saskatchewan, Financial and Consumer Services Commission of New Brunswick, the Manitoba Securities Commission and the Nova Scotia Securities Commission (“Participating Jurisdictions”) published for a 90-day comment period:the “integrated prospectus... **Content:** On March 20, 2014, the Autorité des marchés financiers, the Financial and Consumer Affairs Authority of Saskatchewan, Financial and Consumer Services Commission of New Brunswick, the Manitoba Securities Commission and the Nova Scotia Securities Commission (“**Participating Jurisdictions**”) published for a 90-day comment period: - the “integrated prospectus and registration exemption” (“**Crowdfunding Exemption**”) as set out in a proposed Multilateral Instrument 45-108 “Crowdfunding” and Companion Policy (“**MI 45-108**”); - a separate prospectus and registration exemption for “start-up companies” published under local blanket rulings (“**Start-Up Exemption**”). It is intended that both proposed exemptions will coexist as they target issuers at different stages of development. The Ontario Securities Commission also published materials for comment on March 20, 2014 materials on a prospectus and registration exemptions substantially similar to the Crowdfunding Exemption under a local Ontario Notice entitled “ Introduction of Proposed Prospectus Exemptions and Proposed Reports of Exempt Distributions in Ontario.” On March 20, 2014, the British Columbia Securities Commission also published a local notice (BC Notice 2014/03) soliciting comments on the Start-Up Exemption. Alberta, PEI and Newfoundland as well as the Canadian Territories are not formally participating in the request for comments. Please see an earlier BAX Bulletin dated December 6, 2013 for a summary of the crowdfunding exemption which is currently in force in Saskatchewan. **CrowdFunding Exemption** The following is a summary of the Crowdfunding Exemption under proposed MI 45-108: ***Issuers****:* MI 45-108 sets out a number of requirements for issuers who wish to avail themselves of the Crowdfunding Exemption. First of all it is only available to issuers selling their own securities. It is also only available to Canadian companies – issuers must be incorporated or organized in Canada with a Canadian head office and a majority of resident Canadian directors. Issuers can be public or private companies. The exemption is not available to investment funds, real estate issuers that are not public companies, or issuers without a written business plan. It is also not available to issuers not in compliance with the ongoing requirements of the Crowdfunding Exemption. ***Type of securities offered***: Only certain types of securities can be offered under the Crowdfunding Exemption: common shares, non-convertible preference shares, securities convertible into common shares or non-convertible preference shares, non-convertible debt securities linked to a fixed or floating interest rate, units of a limited partnership, and flow-through shares under the *Income Tax Act* (Canada) ***Restrictions on offerings***: An issuer will not be able to raise more than $1.5 million under the Crowdfunding Exemption during the period commencing 12 months prior to the current offering. The $1.5 million limit will apply in aggregate, to the issuer, an affiliate of the issuer, and any other issuer that is engaged in a common enterprise with the issuer or with an affiliate of the issuer. An offering cannot remain open for more than 90 days and an offering document must disclose a minimum offering size and whether there is a maximum offering size. It will not be possible to close the offering unless: (i) the minimum offering is fully subscribed; and (ii) at time of completion of offering, the issuer has financial resources sufficient to achieve the next milestone in a written business plan or, if there is no milestones, to carry out the activities set out in the business plan. ***Advertising restrictions***: Issuers, portals or any other person involved with an offering cannot advertise the offering or solicit potential investors, except as prescribed. Marketing materials, which are limited to offering documents, documents described in offering documents and any term sheets or other summary (including a video), must be made available to potential investors on portal’s website and cannot be posted on any other website. Investors can be directed to portal’s website by paper notice or through social media. Offering materials must be delivered to the regulator at same time they are posted on portal’s website. ***Investment limits****:* An investor cannot invest more than $2,500 in a single investment and not more than $10,000 in total under the Crowdfunding Exemption in a calendar year. ***Risk Acknowledgment Form***: Investors must sign a risk acknowledgement form (proposed Form 45-108F2) confirming that the investor falls within the investment limits, that the investor could lose all of the money he or she invests, and understands the other specified risks that are set out in the form. ***Disclosure documents***: A disclosure document must be provided to investors that includes basic information about the offering, the issuer and the portal and certain financial information: the amount of issuer’s cash together with third party confirmation of cash in bank account or held in trust if the issuer has not incurred any expenditures and its only asset is cash; and annual financial statements if the issuer has incurred expenditures. The annual financial statements must be audited if the issuer has achieved the Financial Threshold as defined below, or be reviewed by an independent public accounting firm if the issuer has not achieved the Financial Threshold. An issuer will achieve the financial threshold if it has raised more than $500,000 under the Crowdfunding Exemption or any other prospectus exemption since its formation and has expended more than $150,000 since that time (“**Financial Threshold**”). ***Statutory rights***: Investors are entitled to rights of action for rescission or damages in the event of a misrepresentation in any materials made available to purchaser. Investors will have 48 hours prior to the disclosed offering deadline to withdraw. ***Ongoing disclosure***: Public companies must provide ongoing continuous disclosure in accordance with securities law requirements. Private companies must provide the following ongoing disclosure on an annual basis: annual financial statements that are audited if the issuer has achieved the Financial Threshold, or reviewed by an independent public accounting firm if the issuer has not achieved the Financial Threshold; a notice that discloses how the proceeds of a crowdfunding offering have been expended, and disclosure of certain specified events. ***Books and records***: Private companies must keep books and records which contain at a minimum: the offering document; documents described in the offering document and any term sheet or other summary (including a video) provided to investors; completed risk acknowledgement forms; ongoing disclosure documents required for private companies, the number of securities issued by the issuer under the Crowdfunding Exemption as well as the issue price and date, and names of all security holders and the number and type of securities held by each security holder. ***Reports of trade***: Reports of exempt distribution must be filed within 10 days of completion of the distribution. ***Crowdfunding portal requirements***: Investments under the Crowdfunding Exemption must be made through a funding portal registered under applicable securities law. A portal must be registered as a restricted dealer. Portals will not be permitted to register in any other dealer or adviser category (i.e., there will be no dual registration of portals). Portals must comply with general registrant requirements applicable to Exempt Market Dealers (with certain exceptions), including minimum capital, insurance, regulatory reporting, record-keeping and record-retention requirements. ***Due diligence requirements for portals***: Portals will be required to conduct background checks on issuers, directors, officers, promoters and control persons; understand the general structure, features and risks of a security offered; review the information presented by the issuer on the portal’s website to confirm that the information adequately sets out the general features and structure of the securities being sold, issuer-specific risks, parties involved, any identified conflicts of interest, and the intended use of funds; deny access to an issuer if it has reason to believe that the issuer or its offering is fraudulent; provide investor education materials in plain language and obtain a signed risk acknowledgement form from investors. ***Permitted and prohibited activities for portals*:** MI 45-108 imposes certain requirements on portals. For example, a portal may apply criteria to limit the offerings on its platform, provided the criteria are disclosed, applied consistently and would not be viewed by a reasonable person as a recommendation or endorsement. A portal cannot provide specific recommendations or advice to investors about securities being offered on their platform; solicit purchases or sales of securities offered on their platform (other than through posting an offering on the platform); compensate employees or agents to solicit the sale of securities on their platform; hold or handle investor funds/securities; invest in any issuer or underwrite any issuer (subject to receiving fees in the form of securities that do not exceed a 10% ownership interest in the issuer); endorse or comment on the merits or expected returns of an investment to investors (since this would constitute a recommendation or advice); or facilitate secondary trading (resales) in any securities issued under the exemption. **Start- Up Exemption** The Start-up Exemption differs from the Crowdfunding Exemption in that there is no requirement for portal registration; the maximum raises are lower and the provisions are generally less prescriptive. The following is a summary of the Start-Up Exemption under the local blanket orders of the Participating Jurisdictions. ***Issuers:*** The Start-up Exemption is not available for public companies and the issuer’s head office must be located in a Participating Jurisdiction. This exemption is not available to investment funds. ***Type of securities* *offered****:* The Start-up Exemption is limited to distributions by an issuer of securities of its own issue and to certain types of securities: common shares; non-convertible preference shares; securities convertible into common shares or non-convertible; preference shares; non-convertible debt securities linked to a fixed or floating interest rate; and units of a limited partnership. ***Restrictions on offerings***: An issuer will not be able to raise more than $150,000 under each offering and offerings cannot remain open for more than 90 days. The exemption cannot be used more than twice in a calendar year. Offering documents are required to disclose minimum offering size and whether there is a maximum offering size. The minimum amount must be equal to the amount needed to carry out the purpose for which the funds are sought. There can be no concurrent offerings using the exemption for the same project. Each promoter, officer, director and control person of the issuer deliver a complete Individual Information form at least 10 business days prior to beginning to trade. ***Advertising restrictions***: Offering materials can be made available to potential investors only on the portal’s website and must be delivered to regulator at least 10 days before the distribution. ***Investment limits***: An investor cannot invest more than $1,500 in a single investment under the Start-Up Exemption. ***Risk Acknowledgement*** ***Form:*** Investors must be provided with a risk warning that includes that: the investor understands they may lose their entire investment; they understand the illiquid nature of the investment; they have read and understood the offering document; the investment opportunity has not been approved by a Participating Jurisdiction; they have not received advice from the portal or the government of a Participating Jurisdiction; they don’t have as many legal rights when purchasing under this exemption as they would through a prospectus offering; and they reside in a Participating Jurisdiction. ***Disclosure documents***: Issuers must provide standardized disclosure document that includes basic information about the offering, the issuer and the portal. No financial statements are required. ***Statutory rights***: Investors must be informed that there may be limited or no right of action for rescission or damages in the event of a misrepresentation in any materials made available to purchaser. ***Ongoing disclosure***: There is no requirement for ongoing disclosure above any corporate requirements. ***Report of trade:*** Report of trade forms must be filed by issuers within 30 days of the closing of the distribution. ***Portal requirements:*** There is no registration requirement for the portal. The head office of the portal must be located in any of the Participating Jurisdictions and its promoters, directors, officers and control person must be Canadian residents. The portal must deliver a complete Portal Information form to the securities regulatory authority in the Participating Jurisdiction at least 30 days prior to beginning to facilitate distributions. Each promoter, director, officer and control person of the owner of the portal must deliver a complete Portal Individual Information form at least 30 days prior to the Portal beginning to facilitate distributions. ***Due Diligence and other requirements***: Portals will be required to make the offering document of the issuer and the important risk warnings separately available to investors electronically online; allow an investment only once the investor confirms online they have read and understood the offering document and important risk warnings; release funds to the issuer only when the minimum offering amount to close the offering has been reached; ensure that all funds received for an offering are held in trust for the investors; provide the issuer with the details on the investors (name, address, telephone number, email address, detail of purchase) within 15 days of closing of the offering. ***Prohibited activities***: A portal cannot provide investment advice or be related to the issuer of the securities. The comment period for the proposed exemptions is open until June 18, 2014. **Categories:** News & Updates --- ### [University of Toronto - Arbor Award](https://baxsecuritieslaw.com/2014824university-of-toronto-arbor-award/) **Published:** June 28, 2014 **Author:** Barbara Hendrickson **Excerpt:** University of Toronto - Arbor Award June 27th, 2014The University of Toronto has selected the Environmental Finance Advisory Committee of which Barbara Hendrickson is a long time member for the prestigious 2014 Arbor Award. The Arbor Awards were created in 1989 to recognize volunteers for... **Content:** University of Toronto – Arbor Award June 27th, 2014 The University of Toronto has selected the Environmental Finance Advisory Committee of which Barbara Hendrickson is a long time member for the prestigious 2014 Arbor Award. The Arbor Awards were created in 1989 to recognize volunteers for their outstanding personal service to the University of Toronto. Since then, the University has annually acknowledged those whose loyalty, dedication and generosity have added immeasurably to the quality of the experience for students, faculty, staff and alumni. The award ceremony takes place in September at the President’s official residence. **Categories:** News & Updates --- ### [BAX Bulletin - CSA Proposed New Regime for Rights Plans](https://baxsecuritieslaw.com/2014824bax-bulletin-csa-proposed-new-regime-for-rights-plans/) **Published:** July 5, 2013 **Author:** Barbara Hendrickson **Excerpt:** On March 14, 2013, the Canadian Securities Administrators (CSA) published for comment proposed National Instrument 62-105 Security Holder Rights Plans (Proposed Rule) and proposed Companion Policy 62-105CP Security Holder Rights Plans (Proposed Policy).The Proposed Rule and Policy establish a regulatory framework for Rights Plans or... **Content:** On March 14, 2013, the Canadian Securities Administrators (CSA) published for comment proposed National Instrument 62-105 Security Holder Rights Plans (Proposed Rule) and proposed Companion Policy 62-105CP Security Holder Rights Plans (Proposed Policy). The Proposed Rule and Policy establish a regulatory framework for Rights Plans or poison pills in all CSA jurisdictions. In general, the Proposed Rule will allow Rights Plans adopted by boards of directors of issuers to remain in place provided majority security holder approval of the Rights Plan is obtained within 90 days. In order for the Rights Plan to remain effective it must be approved by the shareholders within the 90 day period. This approach would change the current regulatory treatment of Rights Plans. Currently, if a hostile bidder asks a Canadian securities regulatory authority to cease trade a Rights Plan to render it inoperative, that authority will generally do so after a specified time (normally 30-45 days). **Categories:** News & Updates --- ### [Gender Diversity and Canadian Boards of Directors](https://baxsecuritieslaw.com/2014824gender-diversity-and-canadian-boards-of-directors/) **Published:** July 30, 2013 **Author:** Barbara Hendrickson **Excerpt:** On July 30, 2013 the Ontario Securities Commission (“OSC”)published a Staff Consultation Paper 58-401 Disclosure Requirements regarding Women on Boards and in Senior Management(“Paper”) which discussed low levels of representation of women on the boards of Canadian public companies. The Paper arises out of a... **Content:** On July 30, 2013 the Ontario Securities Commission (“OSC”)published a Staff Consultation Paper 58-401 Disclosure Requirements regarding Women on Boards and in Senior Management(“Paper”) which discussed low levels of representation of women on the boards of Canadian public companies. The Paper arises out of a request by the Ontario Minister of Finance, Charles Sousa, and the then Minister Responsible forWomen’s Issues, Laurel Broten. TheOSCis asking for comments on a proposal that would impose a “comply or explain” disclosure regime forTSX listed companies relating to board and senior management gender diversity policies and practices. The focus of the consultation is on advancing the representation of women on boards and in senior management. The proposals would apply to TSX‐listed companies and not companies listed on the TSX Venture Exchange. The Paper outlines how corporate decision‐making benefits from a diversity of opinions and viewpoints. This diversity is enhanced when leadership roles are filled with individuals who have different professional experience, education,skill and individual qualities and attributes such as gender, age, ethnicity and cultural background. The OSC is considering implementing disclosure requirements for TSX listed companies which would require annual disclosure of a company’s policies regarding representation of women on the board and in senior management; including providing a summary of the policy; set out how the policy is intended to advance the participation of women on the board and in senior management of the issuer; explain how the policy is being implemented; describe measurable objectives established under the policy; describe annual and cumulative progress under the policy; describe how the board or the nominating committee measures the effectiveness of the policy. If the issuer does not have a policy the issuer will be required to explain why not and identify any risks or opportunity costs associated with the decision not to have such a policy. The comment period for the Paper will end on September 27, 2013. **Categories:** News & Updates --- ### [New Prospectus Exemption for Distributions to Existing Security Holders March 13, 2014](https://baxsecuritieslaw.com/2014824new-prospectus-exemption-for-distributions-to-existing-security-holders-march-13-2014/) **Published:** March 13, 2014 **Author:** Barbara Hendrickson **Excerpt:** On March 13, 2014 the Canadian Securities Administrators announced that the securities commissions in all of the Canadian jurisdictions except Ontario and Newfoundland are introducing a prospectus exemption that, subject to certain conditions, allows issuers listed on the TSX Venture Exchange (TSXV), Toronto Stock Exchange... **Content:** On March 13, 2014 the Canadian Securities Administrators announced that the securities commissions in all of the Canadian jurisdictions except Ontario and Newfoundland are introducing a prospectus exemption that, subject to certain conditions, allows issuers listed on the TSX Venture Exchange (TSXV), Toronto Stock Exchange (TSX) or Canadian Securities Exchange (CSE) to raise money by distributing securities to their existing security holders. The exemption for existing securities holders permits listed issuers to issue listed securities to their existing security holders, subject to a number of conditions: - the issuer must have a class of equity securities listed on the TSXV, TSX or CSE; - the offering can consist only of a class of equity securities listed on the TSXV, TSX, or CSE, or units consisting of the listed security and a warrant to acquire the listed security; - the issuer must make the offering available to all existing security holders that hold the same type of listed security; - unless the investor has obtained suitability advice from a registered investment dealer, the investor can only invest a maximum of $15,000 per issuer under the exemption in a 12-month period; - the issuer must have filed all timely and periodic disclosure documents as required under applicable securities laws; - the issuer must issue a news release disclosing the proposed offering, including details of the use of proceeds; - each investor must confirm in writing to the issuer that, as at the record date, they held the type of listed security offered under the exemption; - an investor must be provided with certain rights of action in the event of a misrepresentation in the issuer’s continuous disclosure record; and - although an offering document is not required, if an issuer voluntarily provides one, the issuer must file the offering document with the securities regulatory authority and an investor will have certain rights of action in the event of a misrepresentation in it. Issuers will have to file a report of exempt distribution within 10 days after each distribution under the exemption. **Categories:** News & Updates --- ### [TSX V Notice to Issuers - Changes to TSX V Policy Manual](https://baxsecuritieslaw.com/2014824tsx-v-notice-to-issuers-changes-to-tsx-v-policy-manual/) **Published:** August 7, 2013 **Author:** Barbara Hendrickson **Excerpt:** Private Placements - Lapsing of Temporary ReliefOn August 17, 2012, the TSX V implemented, on a temporary basis, relief from certain existing pricing requirements related to Private Placement financings. The three temporary measures (“Relief Measures”) are as follows:Allowing a share/unit offering with an offering price... **Content:** **Private Placements – Lapsing of Temporary Relief** On August 17, 2012, the TSX V implemented, on a temporary basis, relief from certain existing pricing requirements related to Private Placement financings. The three temporary measures (“**Relief Measures**”) are as follows: - Allowing a share/unit offering with an offering price below $0.05. - Allowing a debenture offering with a debenture conversion price below $0.10 - Allowing offerings involving a warrant with an exercise price below $0.10. The Relief Measures are set to expire on August 31, 2013. The TSX V will not be extending the Relief Measures and they will therefore lapse on August 31, 2013. **Proposed Pricing and Share Consolidation Amendments** The TSX V has received regulatory approval for the following amendments which are expected to come into effect sometime in the near future: **Minimum Price for Warrants and Options:** The minimum allowable exercise price for share purchase warrants and incentive stock options will be reduced from $0.10 to $0.05 per share. This will apply to the full term of the warrant or option. **Minimum Price for Convertible Debentures:** The minimum allowable conversion price for debentures will be reduced from $0.10 to $0.05 per share for the first year of the term of the debenture. It will remain at $0.10 per share for the balance of the term of the debenture. **Minimum Price for Initial Public Offerings:** The minimum allowable offering price for a non-Capital Pool Company initial public offering will be reduced from $0.15 to $0.10 per security. **Shareholder Approval for Share Consolidations:** The TSX V will only require shareholder approval for a share consolidation which, when combined with any other share consolidation conducted by the Issuer within the previous 24 months that was not approved by the Issuer’s shareholders, would result in a cumulative consolidation of greater than 10 to 1 over such 24 month period. It should be noted that an Issuer may still be subject to shareholder approval requirements under applicable corporate laws. Although these amendments are not currently in force and will not be until such time as the specific policy amendments are formally implemented, the TSX V has indicated that they will, in the interim, consider allowing Issuers to rely upon the intended changes to the existing policy requirements. **Rescission of Deal Structure and Founder Shares Guidelines** Effective immediately, the TSX V rescinded its Bulletins/Notices to Issuers dated December 11, 2007 and October 20, 2008 related to Deal Structure and Founder Shares Guidelines (collectively, the “**Capital Structure Guidelines**”). Rescinding the Capital Structure Guidelines will have the principal effect of removing the existing 15% limit on “Founder Shares” prescribed by the Capital Structure Guidelines in respect of any New Listing. **Categories:** News & Updates --- ### [Crowdfunding - New Developments June 2014](https://baxsecuritieslaw.com/2014824crowdfunding-newdevelopmentsjune2014/) **Published:** June 18, 2014 **Author:** Barbara Hendrickson **Excerpt:** By Barbara HendricksonOn March 20, 2014, the securities commissions of Quebec, Saskatchewan, New Brunswick, Manitoba and Nova Scotia (“participating jurisdictions”) published for comment:proposed Multilateral Instrument 45-108 and CP “Crowdfunding” (“crowdfunding exemption”); anda separate prospectus and registration exemption for “start-up companies” published under local blanket rulings... **Content:** By Barbara Hendrickson On March 20, 2014, the securities commissions of Quebec, Saskatchewan, New Brunswick, Manitoba and Nova Scotia (“**participating jurisdictions**”) published for comment: - proposed Multilateral Instrument 45-108 and CP “Crowdfunding” (“**crowdfunding exemption**”); and - a separate prospectus and registration exemption for “start-up companies” published under local blanket rulings (“**start-up exemption**”). It is intended that both proposed exemptions will coexist as they are meant to target issuers at different stages of development. On March 20, 2014, the OSC also published a request for comments on an exemption substantially similar to the crowdfunding exemption under a local Ontario notice. On the same date the BCSC published a local notice soliciting comments on the start-up exemption. Alberta, P.E.I., Newfoundland and the territories are not formally participating in the request for comments. Saskatchewan introduced an exemption on Dec. 6, 2013 which is similar to the start-up exemption. The proposals create the potential for a patchwork of regulation in Canada the crowdfunding area. The following is a summary of the crowdfunding exemption: - Available to private or public Canadian issuers selling their own securities. - Not available to investment funds, non-public real estate issuers, issuers without a written business plan; and issuers who are non-compliant with the crowdfunding exemption. - Available for common shares, non-convertible preference shares, certain convertible securities, limited partnership units, and flow-through shares. - Issuers cannot raise more than $1.5 million during a 12-month period. - Offerings cannot remain open for more than 90 days and must have a minimum and maximum. - Offerings can only be closed if the minimum offering is fully subscribed and the issuer has financial resources to meet targets in a business plan. - Issuers cannot advertise the offering or solicit potential investors, except as prescribed. Prescribed materials can only be made available to potential investors on portal’s website. Investors can be directed to the website by paper notice or through social media. Offering materials must be delivered to the regulator at same time they are posted on portal’s website. - An investor cannot invest more than $2,500 in a single investment and not more than $10,000 in a calendar year and must sign a risk-acknowledgement form. - Disclosure documents must include basic information about the offering, the issuer, the portal and certain prescribed financial information. Financial statements may be required and must be audited if the issuer has raised more than $500,000 under a prospectus exemption and has expended more than $150,000 since its formation. - Investors are entitled to rights of action for rescission or damages in the event of a misrepresentation. - Special rules for private companies for ongoing disclosure including audited annual financial statements in certain circumstances. - Special rules for private companies to maintain books and records including offering documents; marketing materials; risk acknowledgement forms; and details of the offerings and investors. - Reports of trade must be filed within 10 days of completion of the distribution. - Offering must be made through a funding portal registered in the restricted dealer category. Portals must comply with general registrant requirements applicable to exempt market dealers (with certain exceptions). - Basic due diligence required by portals includes background checks on issuers, directors, officers, promoters and control persons; understanding of securities offered; review of materials on website; and signed risk acknowledgement forms obtained. - Portals cannot advise or market securities; pay finder’s fees; hold or handle investor funds/securities; invest in securities offered (subject to 10 per cent compensation options) or facilitate resales. The start-up exemption differs from the crowdfunding exemption in that there is no requirement for portal registration; the maximum raises are lower and the provisions are generally less prescriptive. The following is a summary of the differences between the exemptions: - Not available for public companies and the issuer’s head office must be located in a participating jurisdiction. - Not available for flow through shares. - Cannot raise more than $150,000 under each offering. Cannot be used more than twice in a calendar year. - Each promoter, officer, director and control person of the issuer must deliver a complete individual information form at least 10 business days prior to beginning to trade. - An investor cannot invest more than $1,500 in an issuer. - No financial statements required. - No requirement for ongoing disclosure. - Report of trade forms must be filed within 30 days. - No registration requirement for portals. Head office of portals must be in a participating jurisdiction. - Promoters, directors, officers and control persons of the portal must be Canadian residents and must deliver a completed portal individual information form and portal information form at least 30 days prior to commencing operations. - Portals can: only allow trading after the investor confirms they have read and understood the offering documents and risk warnings; only release funds to the issuer after reaching the minimum offering; and must provide issuers with the details on the investors within 15 days of closing of the offering. The comment period is open until June 18, 2014. ***Barbara Hendrickson** is securities partner BAX Securities Law* [http://www.cba.org/CBA/sections\_business/newsletters2014/crowd.aspx](http://www.cba.org/CBA/sections_business/newsletters2014/crowd.aspx) **Categories:** News & Updates --- ### [Appointment to Vice Chair of the Responsible Investment Committee (“RIC”) of the University of Toronto](https://baxsecuritieslaw.com/2014127appointment-to-vice-chair-of-the-responsible-investment-committee-ric-of-the-university-of-toronto/) **Published:** November 28, 2014 **Author:** Barbara Hendrickson **Excerpt:** Barbara has been appointed as Vice Chair of the Responsible Investment Committee (“RIC”) of the University of Toronto. RIC was created to provide advice to the Governing Council of the University through the Financial Services Department, the Business Board to the Administration and the University... **Content:** Barbara has been appointed as Vice Chair of the Responsible Investment Committee (“RIC”) of the University of Toronto. RIC was created to provide advice to the Governing Council of the University through the Financial Services Department, the Business Board to the Administration and the University Of Toronto Asset Management Corporation on how to leverage its investment funds to promote social justice and sustainability and to make proposals regarding how the University can better engage companies as shareholder on becoming more active on the environmental, social, governance issues. **Categories:** News & Updates **Tags:** Announcements --- ### [The Ontario Securities Commission introduces the Existing Security Holder Exemption February 11, 2015](https://baxsecuritieslaw.com/2015211jd7yyofsjr1v5ut347hft46f30b3sd/) **Published:** February 12, 2015 **Author:** Barbara Hendrickson **Excerpt:** Effective February 11, 2015, the Ontario Securities Commission amended OSC Rule 45-501 to introduce a new prospectus exemption that allows issuers listed on the TSX, the TSXV, the CSE or the Aequitas NEO Exchange to raise capital from existing shareholders. The introduction of the existing... **Content:** Effective February 11, 2015, the Ontario Securities Commission amended OSC Rule 45-501 to introduce a new prospectus exemption that allows issuers listed on the TSX, the TSXV, the CSE or the Aequitas NEO Exchange to raise capital from existing shareholders. The introduction of the existing security holder exemption in Ontario follows the introduction of a similar exemption in the rest of Canada in March of 2014 ([See “New Prospectus Exemption for Distributions to Existing Security Holders” March 13, 2014](https://lawfirmbarbara.wpengine.com/blog/2014/8/24/new-prospectus-exemption-for-distributions-to-existing-security-holders-march-13-2014)) The Ontario exemption differs from the exemption in place outside of Ontario in that the Ontario exemption is not available to investment funds. In addition, the Ontario exemption imposes a dilution limit not found in the other jurisdictions. The Ontario exemption imposes an anti-dilution provision that prohibits an issuer from making a distribution that would increase the number of listed securities by more than 100%. In addition only the Ontario exemption includes the Aequtas NEO Exchange. **Categories:** News & Updates --- ### [Barbara Hendrickson running for Bencher of the Law Society of Upper Canada](https://baxsecuritieslaw.com/201532barbara-hendrickson-running-for-bencher-of-the-law-society-of-upper-canada/) **Published:** February 13, 2015 **Author:** Barbara Hendrickson **Excerpt:** Barbara is running for Bencher of the Law Society of Upper Canada. The Law Society of Upper Canada is mandated to govern the legal profession in the public interest. Benchers sit as embers of Convocation to fulfill that mandate. The Bencher election will be held... **Content:** Barbara is running for Bencher of the Law Society of Upper Canada. The Law Society of Upper Canada is mandated to govern the legal profession in the public interest. Benchers sit as embers of Convocation to fulfill that mandate. The Bencher election will be held on April 30, 2015. Read more: [Election Statement](/election-statement) Read more: [Biographical Data](/biographical) **Categories:** News & Updates --- ### [Update on Crowdfunding in Canada - New Rules Effective in BC, Saskatchewan, Manitoba, Quebec, New Brunswick and Nova Scotia effective May 14, 2015](https://baxsecuritieslaw.com/201563update-on-crowdfunding-in-canada-new-rules-effective-in-bc-saskatchewan-manitoba-quebec-new-brunswick-and-nova-scotia-effective-may-14-2015/) **Published:** June 3, 2015 **Author:** Barbara Hendrickson **Excerpt:** The securities commissions in British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia (“participating jurisdictions”) have adopted a new registration and prospectus exemption (“start-up crowdfunding exemption") that allows start-up and early stage companies to raise capital in these jurisdictions, subject to certain conditions. The... **Content:** The securities commissions in British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia (“**participating jurisdictions**”) have adopted a new registration and prospectus exemption (“**start-up crowdfunding exemption”**) that allows start-up and early stage companies to raise capital in these jurisdictions, subject to certain conditions. The start-up crowdfunding exemption was effective May 14, 2015 and is scheduled to expire on May 13, 2020. Ontario is not one of the participating jurisdictions and has indicated that it will bring forward its own version of the crowdfunding exemption. ## The Exemption Private Companies: The start-up crowdfunding exemption allows private companies (non reporting issuers) which are located in a participating jurisdiction to sell their own securities through an online funding portal (“portal”). Disclosure Document: Companies must make available an offering document in the prescribed form to investors, (Form 1) which includes basic information about the issuer, its management and the offering, including how the issuer intends to use the funds raised and the minimum offering amount. Companies must also make available to investors a risk acknowledgement form (Form 2). Limits on Offerings: Companies will not be able to raise more than $250,000 per offering and will only be allowed two offerings in a calendar year. Individual investors will not be able to invest more than $1500 per offering. All offerings must have a minimum offering amount and must stay open for a maximum of 90 days. Contractual Rescission Rights: Investors will have a contractual right to withdraw their offer to purchase securities within 48 hours of the investor’s subscription or notification to the investor that the offering document has been amended. ## Portals The issuer’s securities must be sold through a portal that is either relying on the start-up crowdfunding exemption or is operated by a registered dealer. Registered dealers that operate portals must meet their existing registration obligations under securities legislation and confirm to issuers that they meet or will meet certain conditions provided in the start-up crowdfunding exemption. In order for a portal that is not a registered dealer to operate a portal they must meet a number of conditions. The key conditions are: Filings with Securities Commissions: Portals must deliver a portal information form (Form 3) and individual information forms (Form 4) for each of its principals to the securities commission in the participating jurisdiction at least 30 days prior to its offering. The commission has the option of notifying the portal that the portal cannot rely on the start-up crowdfunding exemption because its principals or their past conduct demonstrate a lack of integrity, financial responsibility or relevant knowledge or expertise. Corporate: The head office of the portal must be in Canada and the majority of the portal’s directors must be Canadian residents. Conflicts: An issuer cannot sell through a portal if the promoters, directors, officers and control persons (“**principals**”) of the portal are a principal of the issuer. Website: The portal must make the offering document of the issuer and the risk acknowledgement form available online to investors and cannot allow a subscription until the investors have confirmed that they have read and understood these documents and that the investor is resident in the jurisdiction. The portal must also disclose the name, residence and contact information for each of the principals of the portal. Payment for Securities: The portal must receive payment for the securities sold through the portal’s website. The funding portal must either release funds to the issuer after the minimum offering amount has been reached if the 48-hour right of withdrawal has elapsed, or return the funds to investors if the minimum offering amount is not reached or if the offering is withdrawn by the issuer. If the investor exercises his or her right to cancel the purchase, the portal must refund all of the investor’s funds within five days of the exercise. No Commissions from Investors: The portal cannot receive a commission, fee or any other amount from an investor and it can only be compensated by issuers. No Advice: The portal cannot provide advice to a purchaser or otherwise recommend or represent that an eligible security is suitable, or about the merits of the investment. Handling Assets: The portal must hold the investors’ assets separate and apart from its own property, in trust for the investor and, in the case of cash, at a Canadian financial institution. Books & Records: The portal must maintain books and records at its head office to accurately record its financial affairs and client transactions, and to demonstrate the extent of the portal’s compliance with the start-up crowdfunding exemption orders for a period of eight years from the date a record is created. **Categories:** News & Updates --- ### [Canadian Securities Regulators adopt changes to the Accredited Investor Regime](https://baxsecuritieslaw.com/2015219canadian-securities-regulators-adopt-changes-to-the-accredited-investor-regime/) **Published:** February 20, 2015 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrator’s announced certain changes to the accredited investor exemption on February 19, 2015 (effective May 5, 2015). The changes require, among other things, that issuers selling under the accredited investor exemption include a new risk acknowledgement form (45-106F9) for most individual accredited... **Content:** The Canadian Securities Administrator’s announced certain changes to the accredited investor exemption on February 19, 2015 (effective May 5, 2015). The changes require, among other things, that issuers selling under the accredited investor exemption include a new risk acknowledgement form (45-106F9) for most individual accredited investors. The form explains the categories of accredited investors and highlights, in plain language, the risk associated with the investment. Individuals with financial assets over $5 million need not sign the form. Issuers are required to retain the form for 8 years after the distribution. The February 19, 2015 amendments also require that issuers take certain steps to verify the availability of the accredited investor exemption for investors. These steps include obtaining and retaining “necessary documents” to demonstrate that the investor is accredited, that is, that the investor has the requisite income and assets to meet the terms of the exemption and asking the investor questions about their net income, financial or net assets and other details of their financial circumstances. It will no longer be sufficient to rely on standard representations in a subscription agreement or an initial beside a category of accredited investor on a certificate unless the issuer also takes reasonable steps to “verify” the representations made by the investor. The new rules impose the additional obligation on the issuer to ensure that the investor and all parties acting on behalf of the issuer understand the terms and conditions of the exemption. The revised CP 45-106 states that the expectation is that the issuer will have policies and procedures in place to confirm that parties acting on behalf of the issuer understand the exemption being relied upon, are able to describe the exemption to the investor, and know what information and documentation must be obtained from the investor to confirm that the conditions of the exemption have been satisfied. Issuers are required to retain all documentation obtained to verify the availability of the exemption for a period of time deemed “suitable” considering, among other things, local legislation concerning limitation periods. **Categories:** News & Updates --- ### [Capital Markets Open Program – How can we get risk capital back?](https://baxsecuritieslaw.com/201533capital-markets-open-program/) **Published:** March 4, 2015 **Author:** Barbara Hendrickson **Excerpt:** Prospectors & Developers Association of CanadaInternational Convention Trade Show & Investors Exchange March 3, 2015 Chair Barbara Hendrickson, CEO Securities Partner BAX Securities LawCapital Markets Open Program: How can we get risk capital back?The Capital Markets Open Program will focus on financing options available for exploration... **Content:** # Prospectors & Developers Association of Canada # International Convention Trade Show & Investors Exchange March 3, 2015 ## Chair Barbara Hendrickson, CEO Securities Partner BAX Securities Law --- ### Capital Markets Open Program: How can we get risk capital back? The Capital Markets Open Program will focus on financing options available for exploration companies during a prolonged downturn in capital raising for the sector. It will also highlight what is happening in other jurisdictions with respect to risk capital for mineral exploration. ### Global issues impacting risk capital **8:45 – 10:00 am** **Chair:** Barbara Hendrickson, BAX Securities Law & Jim Borland, Strait Minerals **Speaker:** Douglas Porter, BMO Capital Markets The financial crisis has resulted in a decline in accessing risk capital. Beyond factors such as commodity prices, global economic conditions and investor demographic shift, what else is driving investors away from investing in risk capital? ### USA and international exchanges: Opportunities for accessing risk capital **10:30 am – 12 noon Chair:** Jim Borland, Strait Minerals **Speakers:** Alexander Lehmann, London Stock Exchange Group & Cromwell Coulson, OTC Markets Group Perspective from International exchanges on how other jurisdictions are coping with the capital raising challenges for junior issuers. ### New exemptions: Will they bring risk capital back? **2:00 – 3:30 pm Chair:** Barbara Hendrickson, BAX Securities Law **Speakers:** Oscar A Jofre, EquityCrowdfunding; Greg Gosson, Amec Foster Wheeler; Matthew McGarth, Optimize Capital Markets & John Steele, Pan Asia Mining Co. Ltd. Discussions focused on new exemption that could be considered by junior issuers for raising capital: crowdfunding, crowdfunding – issuer’s perspective, and offering memorandum exemption, including discussion of NI 43-101 issues. ### Flow-through shares: The good, the bad and the ugly **4:00 – 5:30 pm Chair:** Tom King, KPMG LLP **Speakers:** James Lauer, Natural Resources Canada; Benjamin Cox, Oreninc & Norm Brownstein, PearTree Securities Speakers on the impact of flow through and METC on capital flows, and exploration in Canada - Issues to consider before using flow-through - Trends in using flow-through shares - Type of investors who can get involved, and also compensate for some of the shortcomings of flow-through **Categories:** News & Updates --- ### [Ontario Securities Commission adopts a Family, Friend and Business Associates Exemption](https://baxsecuritieslaw.com/2015219ontario-securities-commission-adopts-a-family-friend-and-business-associates-exemption/) **Published:** February 20, 2015 **Author:** Barbara Hendrickson **Excerpt:** On February 19, 2015 the Ontario Securities Commission announced the introduction of the family, friend and business associates exemption (“FFBA exemption”) effective May 5, 2015. The purpose of the new rules is to bring Ontario in line with the rest of the Canadian jurisdictions to... **Content:** On February 19, 2015 the Ontario Securities Commission announced the introduction of the family, friend and business associates exemption (“FFBA exemption”) effective May 5, 2015. The purpose of the new rules is to bring Ontario in line with the rest of the Canadian jurisdictions to benefit “early-stage” issuers. However, the “made in Ontario” FFBA exemption imposes a number of additional requirements and conditions on the use of the exemption not found in the other jurisdictions. The FFBA exemption allows issuers to distribute securities to the issuer’s directors, officers, control persons and founders as well as certain family members, close personal friends and close business associates of such persons subject to a number of conditions: - The use of registrants, finders, advertising or the payment of fees is considered inconsistent with use of the FFBA exemption. - Relationships based on Internet forums and social media are expressly excluded. - Investment funds are not able to use the FFBA exemption. - Any “offering memorandum” provided to investors in conjunction with the use of the exemption will give investors certain rights of action for damages or rescission in the event of a misrepresentation. - All investors are required to sign a special risk acknowledgment form (45-106F12) and which sets out in plain language the risk associated with making the investment. The form must be retained by the issuer for 8 years. CP 45-106 sets out guidance on who will be considered to fall under the close personal friend and close business associate categories as well as procedures for verifying and documenting whether investors fall under the FFBA exemption. **Categories:** News & Updates --- ### [New Rules on using the Accredited Investor Exemption](https://baxsecuritieslaw.com/2015424new-rules-on-using-the-accredited-investor-exemption/) **Published:** April 23, 2015 **Author:** Barbara Hendrickson **Excerpt:** New Rules on using the Accredited Investor Exemption May 5, 2015On February 19, 2015 the Canadian Securities Administrators (“CSA”) published guidance that clarified how the accredited investor exemption in National Instrument 45-106 Prospectus Exemptions (“NI 45-106”) was to be applied in Canada. Going forward the CSA... **Content:** New Rules on using the Accredited Investor Exemption May 5, 2015 On February 19, 2015 the Canadian Securities Administrators (“CSA”) published guidance that clarified how the accredited investor exemption in National Instrument 45-106 Prospectus Exemptions (“NI 45-106”) was to be applied in Canada. Going forward the CSA guidance stipulates that before issuers will be able to rely on the exemption they will have to verify and document its availability and provide investors relying on the accredited investor exemption with enhanced risk disclosure (Form 45-106F9). These new requirements are expected to come into force on May 5, 2015 **Definition of Accredited Investor** The categories of accredited exemptions have not generally changed with the exception of a new category of accredited investors for a trust established by an accredited investor for the benefit of the accredited investor’s family provided that all of the trustees are accredited investors and all of the family members fall within the prescribed classes of family members. In Ontario, harmonizing with the rest of Canada, fully managed account purchasing investment fund securities will also be exempt under the managed account category. The following is a summary of the categories of accredited investors: 1. An individual who, alone or together with a spouse, owns financial assets worth more than $1 million before taxes but net of related liabilities (related liabilities means liabilities incurred for the purpose of acquiring the financial assets and liabilities that are secured by financial assets); 2. An individual, who alone or together with a spouse, has net assets of at least $5,000,000; 3. An individual whose net income before taxes exceeded $200,000 in both of the last two years and who expects to maintain at least the same level of income this year; or An individual whose net income before taxes, combined with that of a spouse, exceeded $300,000 in both of the last two years and who expects to maintain at least the same level of income this year; 4. An individual who currently is, or once was, a registered adviser or dealer, other than a limited market dealer; 5. Financial institutions; 6. Governments and governmental agencies; 7. Insurance companies; 8. Pension funds; 9. Registered charities; 10. Certain mutual funds, pooled funds and managed accounts; 11. Companies with net assets of at least $5 million; 12. Persons or companies recognized by the OSC as an accredited investor. **Financial assets:** are defined in NI 45-106 to mean cash, securities, or a contract of insurance, a deposit or an evidence of a deposit that is not a security for the purposes of securities legislation. These financial assets are generally liquid or relatively easy to liquidate. The value of an investor’s personal residence is not included in a calculation of financial assets. **Net assets:** means all of the investor’s total assets minus all of the investor’s total liabilities. Accordingly, for the purposes of the net asset test, the calculation of total assets would include the value of an investor’s personal residence and the calculation of total liabilities would include the amount of any liability (such as a mortgage) in respect of the investor’s personal residence. **Determining the Availability of the Accredited Investor Exemption** Before discussing the details of an investment with a prospective investor, issuers are required to obtain information that confirms the investor meets the criteria set out in the accredited investor exemption. The accredited investor exemption requires an investor to meet certain income or asset tests in order for securities to be sold in reliance on the exemption. When distributing securities under the accredited investor exemption, the issuer will have to obtain information from the investor in order to determine whether the investor has the requisite income, assets or relationship to meet the terms of the exemption. It will not be sufficient for the issuer to accept standard representations in a subscription agreement or a certificate attached to a subscription agreement or an initial beside a category on Form 45-106F9 Form unless the issuer has taken reasonable steps to verify the representations made by the investor. **Reasonable Steps:** The issuer must take **reasonable steps** confirm that the investor meets the conditions for the accredited investor exemption. Whether the types of steps are reasonable will depend on the particular facts and circumstances of the investor, the offering and the exemption being relied on, including: • how the issuer identified or located the potential investor; • what category of accredited investor or eligible investor the investor claims to meet; • how much and what type of background information is known about the investor; and • whether the person who meets with, or provides information to, the investor is registered. **Understand Terms of the Exemption:** Issuers must understand the terms and conditions of the accredited investor exemption and be able to explain to an investor the meaning of the terms and conditions of the exemption. **Policies & Procedures:** Issuer must have policies and procedures in place to confirm that the representatives of the issuer understand the exemption being relied on, and are able to describe the terms of the exemption to investors and know what information and documentation must be obtained from investors to confirm that the conditions of the exemption have been satisfied. **Verification:** Issuers must verify that the investor meets the criteria set out in the exemption. To assess whether an investor is an accredited investor or eligible investor, issuers should ask questions about the investor’s net income, financial assets or net assets, or other questions designed to elicit details about the investor’s financial circumstances. If the issuer has concerns about the investor’s responses, the issuer should make further inquiries about the investor’s financial circumstances. If the issuer still questions the investor’s eligibility, the issuer should ask to see documentation that independently confirms the investor’s claims. **Collection and Retention of Documentation:** The issuer should consider what documentation it needs to retain or collect from an investor to evidence the steps the issuer followed to establish the investor met the conditions of the exemption. The issuer must retain the documentation to evidence the steps the issuer has taken to verify the availability of the exemption. **Risk Acknowledgement Form:** The issuer must obtain a signed risk acknowledgement form (45-106F9 from the investor and retain that risk acknowledgement for 8 years after the distribution. The issuer must also comply with the requirements under provincial or federal legislation concerning the protection of personal information when collecting and retaining investor information. **Categories:** News & Updates --- ### [Barbara Hendrickson quoted in CBA National Magazine - "Alternative Fee Arrangements”](https://baxsecuritieslaw.com/2015515alternative-fee-arrangements-article-by-becky-rynor/) **Published:** May 15, 2015 **Author:** Barbara Hendrickson **Excerpt:** From National Magazine: Legal Insights and Practice Trends - a magazine published by the Canadian Bar Association"Barbara Hendrickson was ahead of the pack when she founded BAX Securities Law in Toronto in 2012 and started offering alternative fee structures from day one."...Read more: http://www.nationalmagazine.ca/Articles/Mai-2015-Web/Alternative-fee-arrangements.aspx **Content:** From National Magazine: Legal Insights and Practice Trends – a magazine published by the Canadian Bar Association *“Barbara Hendrickson was ahead of the pack when she founded BAX Securities Law in Toronto in 2012 and started offering alternative fee structures from day one.”…* [Read more: http://www.nationalmagazine.ca/Articles/Mai-2015-Web/Alternative-fee-arrangements.aspx](http://www.nationalmagazine.ca/Articles/Mai-2015-Web/Alternative-fee-arrangements.aspx) **Categories:** News & Updates --- ### [New Friends Family & Business Associates Exemption Comes to Ontario May 5, 2015](https://baxsecuritieslaw.com/201569new-friends-family-business-associates-exemption-comes-to-ontario-may-5-2015/) **Published:** June 10, 2015 **Author:** Barbara Hendrickson **Excerpt:** Effective May 5, 2015 the Ontario Securities Commission (“OSC”) introduced a friends and business associates prospectus exemption (“FFBA Exemption”) to allow issuers (other than investment funds) to raise capital from their networks of family, close personal friends and close business associates. The FFBA Exemption is... **Content:** Effective May 5, 2015 the Ontario Securities Commission (“**OSC**”) introduced a friends and business associates prospectus exemption (“**FFBA Exemption**”) to allow issuers (other than investment funds) to raise capital from their networks of family, close personal friends and close business associates. The FFBA Exemption is available to reporting issuers as well as non-reporting issuers and to issuers as well as selling securityholders. The FFBA Exemption permits issuers to distribute securities to the issuer’s directors, executive officers, control persons and founders as well as certain family members, close personal friends and close business associates of such persons, subject to a number of conditions. The new exemption in Ontario is largely harmonized with an exemption that is currently available in other Canadian jurisdictions. It allows for the sale of securities by a selling security holder or an issuer to principals of the issuer as well as certain family members, close personal friends and close business associates. The exemption is based on investors having a sufficiently close relationship with a principal of the issuer to assess the capabilities and trustworthiness of the principals and access information about their investment. As a condition to the exemption, a signed risk acknowledgement form must be obtained, setting out the key risks related to the investment and confirming how the investor qualifies to make the investment. Guidance in 45-106CP explains that in Ontario, the use of registrants, finders or advertising, as well as payment of fees or commissions to any person to find purchasers is inconsistent with the use of the FFBA Exemption. Expanded guidance in 45-106CP on the meaning of close personal friend and close business associate provides that the onus is on the issuer or selling security holder to establish whether a close personal relationship exists, various factors will be considered relevant in making this determination, and we will not generally consider an individual with whom a friendship is primarily founded on participation in an internet forum or social media to be a close personal friend or close business associate. The risk acknowledgement form, Form 45-106F12 *Risk Acknowledgement Form for Family, Friend and Business Associate Investors* (Form 45-106F12), must be signed by (1) the investor, (2) the director, executive officer, control person or founder of the issuer with whom the investor has asserted the relationship (either directly or through the spouse of the director, executive officer, founder or control person), if applicable, and (3) the issuer. The investor must acknowledge certain risks associated with the investment The investor must also disclose as applicable the identity of the director, executive officer, control person or founder of the issuer with whom they assert a relationship, that person’s position at or relationship with the issuer, the category of the relationship asserted by the investor and how long the investor has known that person. Risk acknowledgement form must be retained by the person making the distribution for a period of eight years after the distribution **Categories:** News & Updates --- ### [CSA Proposes Amendments to Take-over Bid Rules March 31, 2015](https://baxsecuritieslaw.com/201569csa-proposes-amendments-to-take-over-bid-rules-march-31-2015/) **Published:** June 10, 2015 **Author:** Barbara Hendrickson **Excerpt:** On March 31, 2015, the Canadian Securities Administrators (“CSA”) published, for a 90 day comment period, proposed amendments to Multilateral Instrument 62-104 Take-Over Bids and Issuer Bids (“MI 62-104”) and changes to National Policy 62-203 Take-Over Bids and Issuer Bids (“NP 62-203”) (“Proposed TOB Amendments”).Currently, MI 62-104 governs take-over... **Content:** On March 31, 2015, the Canadian Securities Administrators (“**CSA**”) published, for a 90 day comment period, proposed amendments to Multilateral Instrument 62-104 *Take-Over Bids and Issuer* Bids (“**MI 62-104”**) and changes to National Policy 62-203 *Take-Over Bids and Issuer Bids* (“**NP 62-203”**) (“**Proposed TOB Amendments”**). Currently, MI 62-104 governs take-over bids and issuer bids in all jurisdictions of Canada, except Ontario. In Ontario, substantively harmonized requirements for take-over bids and issuer bids are set out in Part XX of the *Securities Act* (Ontario) (“**OSA**”) and Ontario Securities Commission Rule 62-504 *Take-Over Bids and Issuer Bids* (“**62-504”**). NP 62-203 applies in all jurisdictions of Canada. MI 62-104, the OSA, 62-504 and NP 62-203 are referred to as the “**take-over bid rules”**. The OSC intends to seek legislative amendments to the OSA to accommodate the adoption of the Proposed TOB Amendments in Ontario. According to the CSA, the Proposed TOB Amendments are designed “to enhance the quality and integrity of the take-over bid regime and rebalance the current dynamics among offerors, offeree issuer boards of directors (“**offeree boards”**), and offeree issuer security holders by (i) facilitating the ability of offeree issuer security holders to make voluntary, informed and co-ordinated tender decisions, and (ii) providing the offeree board with additional time and discretion when responding to a take-over bid. The following outlines the Proposed TOB Amendments for all non-exempt take-over bids: **Minimum Tender Requirement** Under the Proposed TOB Amendments, Offerors will be required to receive tenders of more than 50% of the outstanding securities of the class that are subject to the bid, excluding securities beneficially owned, or over which control or direction is exercised, by the offeror or by any person acting jointly or in concert with the offeror (“**Minimum Tender Requirement”**). The Minimum Tender Requirement will establish a mandatory majority acceptance standard for all take-over bids, whether a bid is made for all or only a portion of the outstanding securities. The purpose of the majority standard is to address the current possibility that control of, or a controlling interest in, an offeree issuer can be acquired through a take-over bid without a majority of the independent security holders of the offeree issuer supporting the transaction if the offeror elects, at any time, to waive its minimum tender condition (if any) and end its bid by taking up a smaller number of securities. **10 Day Extension Requirement** The Proposed TOB Amendments require that the offer be extended by the offeror for an additional 10 days after the Minimum Tender Requirement has been achieved and all other terms and conditions of the bid have been complied with or waived (“**10 Day Extension Requirement”**); Currently, offerors are not required to extend their bids after they have taken up offeree issuer securities and there is no formal mechanism for offeree issuer security holders to coordinate their actions in the bid context. As a result, offeree issuer security holders make tender decisions without knowing what other security holders will do and with the awareness that the offeror can always elect to waive its minimum tender condition (if any) and end its bid by taking up a smaller number of securities, thereby altering the future control of the offeree issuer. This situation creates “pressure to tender” or coercion concerns since security holders may tender to the take-over bid or sell in the market not because they support the bid but because they are afraid of being “left behind” if the offeror obtains sufficient tenders from other security holders. The 10 Day Extension Requirement addresses the “pressure to tender” concern by protecting the security holder’s ability to tender whether or not it supports the bid in the first instance. As well, by mitigating coercive dynamics in the tender process, the 10 Day Extension Requirement enhances the quality and integrity of the collective majority security holder decision on whether or not to approve the bid. **120 Day Requirement** The Proposed TOB Amendments require that the offer remain open for a minimum deposit period of 120 days (“**120 Day Requirement”**) unless: (a) the offeree board states in a news release a shorter deposit period for the bid of not less than 35 days that is acceptable to the offeree board, in which case all contemporaneous take-over bids must remain open for at least the stated shorter deposit period, or (b) the issuer issues a news release that it has agreed to enter into, or determined to effect, a specified alternative transaction, in which case all contemporaneous take-over bids must remain open for a deposit period of at least 35 days. The first exception is available where an offeree board issues a news release in respect of a proposed or commenced take-over bid stating a deposit period for the bid of not less than 35 days that is acceptable to the offeree board. In this circumstance, the bid regime would provide that the minimum deposit period for the subject bid must be at least the number of days from the date of the bid as stated in the news release, instead of 120 days from the date of the bid. The second exception covers the situation where an issuer issues a news release announcing that it has agreed to enter into, or determined to effect, an “alternative transaction” (being, generally, a plan of arrangement or similar change of control transaction to be approved by security holders of the issuer). In this case, the minimum deposit period for any then-outstanding take-over bid or subsequent take-over bid commenced before the completion of the alternative transaction must be at least 35 days, rather than 120 days, from the date of the bid. The 120 Day Requirement is intended to provide offeree boards with a longer, fixed period of time to consider and respond to a take-over bid. The current take-over bid regime mandates a minimum 35 day deposit period. Where a board has adopted a security holder rights plan (a **Rights Plan**) to prevent a bid from being completed after 35 days, securities regulators have typically cease-traded the Rights Plan approximately 45-60 days after the commencement of the bid. The 120 Day Requirement responds to the concern, that offeree boards do not have enough time to respond to unsolicited take-over bids with appropriate action, such as seeking value-maximizing alternatives or developing and articulating their views on the merits of the bid. The comment period closed on June 30, 2015 **Categories:** News & Updates --- ### [Manitoba Model - Offering Memorandum Prospectus Exemption (November 25, 2015)](https://baxsecuritieslaw.com/20151129manitoba-model-offering-memorandum-prospectus-exemption-november-25-2015/) **Published:** November 30, 2015 **Author:** Barbara Hendrickson **Excerpt:** Going forward in Canada there will be three forms of the offering memorandum prospectus exemption in place across Canada: the new “Ontario Model” (Alberta, New Brunswick, Nova Scotia, Ontario, Québec and Saskatchewan), the “BC Model” (BC and Newfoundland) and the “Manitoba Model” (Northwest Territories, the... **Content:** Going forward in Canada there will be three forms of the offering memorandum prospectus exemption in place across Canada: the new “Ontario Model” (Alberta, New Brunswick, Nova Scotia, Ontario, Québec and Saskatchewan), the “BC Model” (BC and Newfoundland) and the “Manitoba Model” (Northwest Territories, the Yukon, Nunavut, Prince Edward Island and Manitoba). For a discussion of the Ontario Model which will come into effect in Ontario on January 13th 2016 and the other Ontario Model jurisdictions on April 30th 2016 please see Offering Memorandum Prospectus Exemption Available in Ontario January 13, 2016. For a discussion of the BC Model (which is currently in effect) please see [BC Model – Offering Memorandum Prospectus Exemption.](https://lawfirmbarbara.wpengine.com/blog/2015/11/29/bc-model-offering-memorandum-prospectus-exemption-november-25-2015) This article discusses the Manitoba Model which has been in effect for over 10 years. Under all of the offering memorandum exemptions in effect in Canada, issuers who produce a prescribed disclosure document are able to sell securities to investors as long as the disclosure document is up to date and the financial statements are not stale. The Manitoba Model (unlike the Ontario Model) does not require that non-reporting issuers provide investors with audited annual financial statements; annual notices on how the proceeds raised under the offering memorandum exemption have been used, notices in the event of a discontinuation of the issuer’s business, a change in the issuer’s industry or a change of control of the issuer, and does not require that marketing materials be incorporated by reference into the offering memorandum to provide investors with the same rights of action in respect of all disclosure made under the offering memorandum exemption in the event of a misrepresentation. The following is a summary of the new key features of the Manitoba Model: Issuer qualifications – available to both reporting and non-reporting issuers. Types of securities – available for all types of securities including investment funds. Offering parameters – there is no limit on the size or the number of offerings and there is no restriction on the length of time the offering can remain open (subject to the offering memorandum being up to date and the financial statements not stale). Registrant Involvement – there is no prohibition on using registrants that are related to an issuer. Investment limits – there will be no investment limits for eligible investors. Non-eligible investors will only be able invest up to $10,000. Eligible investors are those with net assets alone or with a spouse in the case of an individual which exceeds $400,000 or whose net income before taxes exceeded $75,000 alone or $125,000 with a spouse in two of the most recent calendar years and reasonable expects to exceed that level in the current year. Risk acknowledgement form – investors must sign a risk acknowledgement form 45-106 F4. Disclosure of audited annual financial statements, notice of use of proceeds and notice of specified key events – none required. Marketing and advertising – there is no restriction on advertising. Marketing materials used by issuers in distributions under the offering memorandum exemption must only contain material that is found in the offering memorandum. For more information on the Manitoba Model as well as the BC and Ontario Models please contact Barbara Hendrickson at 647.403.4606. **Categories:** News & Updates --- ### [BC Model - Offering Memorandum Prospectus Exemption (November 25, 2015)](https://baxsecuritieslaw.com/20151129bc-model-offering-memorandum-prospectus-exemption-november-25-2015/) **Published:** November 30, 2015 **Author:** Barbara Hendrickson **Excerpt:** Going forward in Canada there will be three forms of the offering memorandum prospectus exemption in place across Canada: the new “Ontario Model” (Alberta, New Brunswick, Nova Scotia, Ontario, Québec and Saskatchewan) which will be in effect in Ontario on January 13, 2016 and the... **Content:** Going forward in Canada there will be three forms of the offering memorandum prospectus exemption in place across Canada: the new “Ontario Model” (Alberta, New Brunswick, Nova Scotia, Ontario, Québec and Saskatchewan) which will be in effect in Ontario on January 13, 2016 and the other Ontario Model jurisdictions on April 30, 2016, the “BC Model” (BC and Newfoundland) and the “Manitoba Model” (Northwest Territories, the Yukon, Nunavut, Prince Edward Island and Manitoba) which is currently in effect. For a discussion of the Ontario Model please see Offering Memorandum Prospectus Exemption Available in Ontario January 13, 2015. For a discussion of the Manitoba Model please see [Manitoba Model – Offering Memorandum Prospectus Exemption.](https://lawfirmbarbara.wpengine.com/blog/2015/11/29/manitoba-model-offering-memorandum-prospectus-exemption-november-25-2015) This article discusses the BC Model which has been in effect for over 10 years. Under all of the offering memorandum exemptions, issuers who produce a prescribed disclosure document are able to sell securities to investors as long as the disclosure document is up to date and the financial statements are not stale. Under the BC Model (unlike the Ontario Model), there is no requirement that non-reporting issuers provide investors with audited annual financial statements; annual notices on how the proceeds raised under the exemption have been used; notices in the event of a discontinuation of the issuer’s business, a change in the issuer’s industry or a change of control of the issuer; requiring that marketing materials be incorporated by reference into the offering memorandum to provide investors with the same rights of action in respect of all disclosure made under the offering memorandum exemption in the event of a misrepresentation; and imposing additional investment limits in respect of both eligible (i.e., investors who meet certain income or asset thresholds) and non-eligible investors that are individuals to limit the risks associated with an investment in securities acquired under the offering memorandum exemption. The following is a summary of the key features of the Manitoba Model: Issuer qualifications – available to both reporting and non-reporting issuers. Types of securities – available for any type of security including investment funds. Offering parameters – there is no limit on the size or the number of offerings and there is no restriction on the length of time the offering can remain open (subject to the OM being up to date and the financial statements not stale). Registrant Involvement – there is no prohibition on using registrants that are related to an issuer. Investment limits – there will be no investment limits for “eligible investors”. Non eligible investors will only be able invest up to $10,000. Eligible investors are individuals with net assets alone or with a spouse in the case of an individual which exceeds $400,000 or whose net income before taxes exceeded $75,000 alone or $125,000 with a spouse in two of the most recent calendar years and reasonable expects to exceed that level in the current year. Risk acknowledgement form – there are no risk acknowledgment forms. Ongoing Disclosure of audited annual financial statements, notice of use of proceeds and notice of specified key events – there are no ongoing requirements. Marketing and advertising – there is no restriction on advertising, marketing materials used by issuers in distributions; but any material in the marketing materials must also be included in the offering memorandum. For more information on the BC Model as well as the Ontario and Manitoba Models please contact Barbara Hendrickson at 647.403.4606. **Categories:** News & Updates --- ### [September 1st, 2015 Barbara Hendrickson appointed Co-Chair of the Ontario Bar Association (“OBA”) Securities Committee.](https://baxsecuritieslaw.com/201591september-1st-2015-barbara-hendrickson-appointed-co-chair-of-the-ontario-bar-association-oba-securities-committee/) **Published:** September 2, 2015 **Author:** Barbara Hendrickson **Excerpt:** The Business Law Section of the OBA has appointed Barbara as the Co-Chair of the Securities Committee. The Securities Committee covers all aspects of securities laws and is made up of securities law experts from private practice, in house and government. This highly active Committee... **Content:** The Business Law Section of the OBA has appointed Barbara as the Co-Chair of the Securities Committee. The Securities Committee covers all aspects of securities laws and is made up of securities law experts from private practice, in house and government. This highly active Committee plays a key role in advising the Ontario Securities Commission on legislative and policy changes in the securities law area. **Categories:** News & Updates --- ### [Crowdfunding Exemption in effect in Ontario on January 25th , 2016](https://baxsecuritieslaw.com/20151117crowdfunding-exemption-in-effect-in-ontario-on-january-25th-2015/) **Published:** November 13, 2015 **Author:** Barbara Hendrickson **Excerpt:** The securities commissions in Manitoba, Ontario, Québec, New Brunswick and Nova Scotia (“Participating Jurisdictions”) are publishing in final form Multilateral Instrument 45-108 Crowdfunding (“MI 45-108”), which includes a crowdfunding prospectus exemption and a registration framework for funding portals (the “New Crowdfunding Exemption”).MI 45-108 is expected... **Content:** The securities commissions in Manitoba, Ontario, Québec, New Brunswick and Nova Scotia (“**Participating Jurisdictions**”) are publishing in final form Multilateral Instrument 45-108 *Crowdfunding* (“**MI 45-108**”), which includes a crowdfunding prospectus exemption and a registration framework for funding portals (the “**New Crowdfunding Exemption**”). MI 45-108 is expected to come into force in the Participating Jurisdictions on January 25, 2016. Saskatchewan has gone out for a 60 comment period on MI 45-108. The provinces of British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia also have another form of crowdfunding exemption which is focused on starts up which has been place since May 14, 2014. On October 19th, 2015 the province of Alberta and the territory of Nunavut published a request for comments on their version of the crowdfunding exemption. The New Crowdfunding Exemption encompasses measures which are intended to provide effective protection for investors, including: **Type of security** – issuers can only offer non-complex securities such as common shares and nonconvertible debt. Offering limit – issuers can only raise $1.5 million in a 12 month period under the New Crowdfunding Exemption. **Distribution period** – the offering can only continue for 90 days. **Issuer qualification** – available to entities organized or incorporated in Canada, with a head office in Canada with the majority of directors resident in Canada. **Investment limits** – investors are subject to the following investment limits: 1\. an investor that does not qualify as an accredited investor: · $2,500 per investment, and · in Ontario, $10,000 in total in a calendar year, 2\. an accredited investor other than a permitted client: · $25,000 per investment, and · in Ontario, $50,000 in total in a calendar year, 3\. in Ontario, no investment limits for a permitted client. In Ontario the funding portal must file For 45-108F3 – Confirmation of Investment Limits. **Offering document** – issuers are required to prepare an offering document that contains all of the information about the issuer and its business that an investor should know before purchasing the issuer’s securities. The issuer must also provide financial statements and may provide other materials such as term sheets; videos and other summaries. **Risk acknowledgement form 45-108F3** (“**RAF**”) – investors must complete a RAF requiring them to positively confirm having read and understood the risk warnings and information in the crowdfunding offering document before they can enter into an agreement to purchase securities. **Cooling off period** – Investors have a two business day right of withdrawal. **Liability for materials** – issuers are accountable for and are subject to a standard of liability on the crowdfunding offering document and other permitted materials, and investors are provided with a related right of action. The standard for non reporting issuer is an “untrue statement of material fact.” For reporting issuers the standard is a “misrepresentation” which include untrue statements and omissions. **Advertising and solicitation** – there is a prohibition on advertising and general solicitation. Issuers may only inform purchasers that it proposed to distribute securities under the New Crowdfuding Exemption and direct purchasers to the funding portal. Funding portals are allowed to advertise its business but is prohibited from recommending or endorsing a particular issuer or distribution, including highlighting or showcasing an issuer or its distribution. **Ongoing disclosure** – non-reporting issuers must make available to investors (i) annual financial statements (audited in some circumstances), (ii) a notice of use of proceeds, and (iii) in New Brunswick, Nova Scotia and Ontario, a notice of a discontinuation of the issuer’s business, a change in the issuer’s industry or a change of control of the issuer. Reporting issuers must continue to comply with all of their disclosure requirements. **Registered funding portal** – issuers can only distribute securities through a single funding portal that is registered as an investment dealer, exempt market dealer or restricted dealer, and must post the offering document and other permitted materials solely on that funding portal’s online platform. Investment dealers and exempt market dealers must comply with all of the requirements of their registration, including FYC, KYP and suitability. **Funding portal requirements** – funding portals are prohibited from offering securities of a related issuer but can offer real estate securities; a funding portal must fulfill certain gatekeeper responsibilities prior to allowing an issuer access to its online platform, including reviewing the issuer’s disclosure in the crowdfunding offering document and other permitted materials for completeness, accuracy and any misleading statements, a funding portal must review information and obtain background checks on the issuer and its directors, executive officers and promoters (including criminal checks), and deny an issuer access to the funding portal in certain circumstances. During the period of distribution are also required to report “bad actors” to the OSC. Please note that the use of the internet for raising capital is not restricted to the New Crowdfunding Exemption as defined in MI 45-108. Many online platforms are used to raise capital under other prospectus exemptions such as the accredited investor exemption or the offering memorandum exemption. For more information on the New Crowdfunding Exemption please call Barbara Hendrickson at 647.403.4606. **Categories:** News & Updates --- ### [Offering Memorandum Prospectus Exemption Available In Ontario January 13, 2016](https://baxsecuritieslaw.com/20151117offering-memorandum-prospectus-exemption-available-in-ontario-january-16-2016/) **Published:** November 13, 2015 **Author:** Barbara Hendrickson **Excerpt:** The securities commissions in Alberta, New Brunswick, Nova Scotia, Ontario, Québec and Saskatchewan (“Participating Jurisdictions”) are amending National Instrument 45-106 Prospectus Exemptions (“NI 45-106”) in respect of the offering memorandum exemption in section 2.9 of NI 45-106 in those jurisdictions (“New OM Exemption”).The new rules... **Content:** The securities commissions in Alberta, New Brunswick, Nova Scotia, Ontario, Québec and Saskatchewan (“**Participating Jurisdictions**”) are amending National Instrument 45-106 Prospectus Exemptions (“**NI 45-106**”) in respect of the offering memorandum exemption in section 2.9 of NI 45-106 in those jurisdictions (“**New OM Exemption**”). The new rules will come into force in Ontario on January 13, 2016 and in Alberta, New Brunswick, Nova Scotia, Québec and Saskatchewan on April 30, 2016. No changes are being made to the current OM exemption currently in place in Manitoba, Prince Edward Island, British Columbia and the territories. This will result in two different forms of the OM exemption in place across Canada with different phase in periods for the New OM Exemption in Ontario (January 16th, 2016) and in the other Participating Jurisdictions (April 30, 2016). There is currently an OM exemption in two forms in place in all provinces and territories in Canada except Ontario– the “**BC Model**” in place in British Columbia, New Brunswick, Nova Scotia and Newfoundland and the “**Alberta Model**” in place in Alberta, Manitoba, Northwest Territories, Nunavut, Prince Edward Island, Québec, Saskatchewan and the Yukon. The BC Model has no restriction on purchaser or investment size. Under the Alberta Model, the purchaser must be an “eligible investor” or acquisition cost must not be more than $10,000. The Alberta model also has limited application to investment funds. After the New OM Exemption is introduced, the BC Model will be in effect in BC and Newfoundland the Alberta Model will be in effect in the Northwest Territories, the Yukon, Nunavut, Prince Edward Island and Manitoba. Under all of the offering memorandum exemptions, issuers who produce a prescribed disclosure document are able to sell securities to investors as long as the disclosure document is up to date and the financial statements are not stale. The New OM Exemption will contain a number of changes from the BC and Alberta Models exemption which are features designed to enhance investor protection. These include: 1\. requiring that non-reporting issuers provide to investors: - audited annual financial statements - an annual notice on how the proceeds raised under the OM exemption have been used, and - in New Brunswick, Nova Scotia and Ontario, notice in the event of a discontinuation of the issuer’s business, a change in the issuer’s industry or a change of control of the issuer, 2\. requiring that marketing materials be incorporated by reference into the offering memorandum to provide investors with the same rights of action in respect of all disclosure made under the OM exemption in the event of a misrepresentation, and 3\. imposing additional investment limits in respect of both eligible (i.e., investors who meet certain income or asset thresholds) and non-eligible investors that are individuals to limit the risks associated with an investment in securities acquired under the OM exemption. The following is a summary of the new key features of the New OM Exemption adopted by the Participating Jurisdictions. **Issuer qualifications** – available to both reporting and non-reporting issuers, but not available to investment funds in New Brunswick, Quebec and Ontario. There are no industry or other restrictions. **Types of securities** – not available for distributions of specified derivatives and structured finance products. Issuers will be prohibited from relying on the New OM Exemption to distribute specified derivatives or structured finance products. In Alberta, Nova Scotia and Saskatchewan, the New OM Exemption will continue to be available to investment funds only if they are non-redeemable investment funds or mutual funds that are reporting issuers. In New Brunswick, Ontario and Québec, the New OM Exemption will not be available to investment funds. **Offering parameters** – there is no limit on the size or the number of offerings and there is no restriction on the length of time the offering can remain open (subject to the OM being up to date and the financial statements not stale). **Registrant Involvement** – no prohibition on using registrants that are related to an issuer. **Investment limits** – there will be investment limits for both eligible and non-eligible investors that are individuals (other than those that qualify as accredited investors or under the family, friends and business associates exemption). Eligible investors are individuals with net assets alone or with a spouse in the case of an individual which exceeds $400,000 or whose net income before taxes exceeded $75,000 alone or $125,000 with a spouse in two of the most recent calendar years and reasonable expects to exceed that level in the current year. These limits will not apply to non-individual investors, whether eligible or non-eligible. There is a higher investment threshold for eligible investors when a portfolio manager, investment dealer or exempt market dealer has made a positive suitability assessment. The investment limits will apply to all securities acquired under the New OM Exemption as follows: · in the case of a non-eligible investor that is an individual, the acquisition cost of all securities acquired by the purchaser under the New OM Exemption in the preceding 12 months cannot exceed $10,000, · in the case of an eligible investor that is an individual, the acquisition cost of all securities acquired by the purchaser under the New OM Exemption in the preceding 12 months cannot exceed $30,000, and · in the case of an eligible investor that is an individual and that receives advice from a portfolio manager, investment dealer or exempt market dealer that the investment above $30,000 is suitable, the acquisition cost of all securities acquired by the purchaser under the New OM Exemption in the preceding 12 months cannot exceed $100,000. **New schedules to the risk acknowledgement form** – the Participating Jurisdictions will continue to require all investors (including those who qualify as permitted clients) to complete and sign form 45-106F4 Risk Acknowledgement, which highlights for investors the key risks associated with investing in securities acquired under the New OM Exemption. However, two new schedules have been added which must be completed by each investor that is an individual in conjunction with the risk acknowledgement form. One schedule asks investors to confirm their status, as an eligible investor, non-eligible investor, accredited investor or an investor who would qualify to purchase securities under the family, friends and business associates exemption. The other schedule requires confirmation that the investor is within the investment limits, where applicable. Investors that are not individuals do not have to complete these new schedules. **Disclosure of audited annual financial statements, notice of use of proceeds and notice of specified key events** – non-reporting issuers that use the OM exemption will be required to provide audited annual financial statements to investors, as well as a notice that accompanies the financial statements which describes how the money raised under the OM exemption has been used. A new prescribed form has been introduced for the purposes of this disclosure. In New Brunswick, Nova Scotia and Ontario, non-reporting issuers will also be required to provide notice to investors of the following events, within 10 days of the event occurring, in a new prescribed form (Form 45-106F17): · a discontinuation of the issuer’s business, · a change in the issuer’s industry, or · a change of control of the issuer. **Marketing and advertising** – there is no restriction on advertising, marketing materials used by issuers in distributions under the New OM exemption must be incorporated by reference into the OM. As a result, the marketing materials will be subject to the same liability as the disclosure provided in the offering memorandum in the event of a misrepresentation. For more information on the New OM Exemption as well as the BC and Alberta Models please contact Barbara Hendrickson at 647.403.4606. **Categories:** News & Updates --- ### [Barbara Hendrickson quoted in: Canadian Lawyer Magazine: Securities reform heats up](https://baxsecuritieslaw.com/2016112barbara-hendrickson-quoted-in-canadian-lawyer-magazine-securities-reform-heats-up/) **Published:** January 12, 2016 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson quoted in:Canadian Lawyer Magazine: Securities reform heats upRead more... **Content:** Barbara Hendrickson quoted in: [Canadian Lawyer Magazine: Securities reform heats up](http://www.canadianlawyermag.com/legalfeeds/3072/securities-reform-heats-up.html) [Read more…](http://www.canadianlawyermag.com/legalfeeds/3072/securities-reform-heats-up.html) **Categories:** News & Updates --- ### [Update on the Canadian Landscape – Climate Change](https://baxsecuritieslaw.com/2016210update-on-the-canadian-landscape-climate-change/) **Published:** February 8, 2016 **Author:** Barbara Hendrickson **Excerpt:** Canadian Federal GovernmentThe change in federal government last fall from Steven Harper’s Conservative Government to Justin Trudeau’s Liberal Government appears to make the outlook for regulation of climate change in Canada more optimistic. Mr. Trudeau, the new Canadian Prime Minister, made commitments at the Paris... **Content:** ## Canadian Federal Government The change in federal government last fall from Steven Harper’s Conservative Government to Justin Trudeau’s Liberal Government appears to make the outlook for regulation of climate change in Canada more optimistic. Mr. Trudeau, the new Canadian Prime Minister, made commitments at the Paris COP 21 “to establish a “Pan-Canadian framework for combatting climate change”, that accommodates different provincial strategies and that “set a truly national target that the federal government and the provinces can work together to achieve” and “ensure that the provinces and territories have targeted federal funding and the flexibility to design their own carbon pricing policies”. The current federal government proposal is a minimum price on carbon of at least $15 a tonne either through a federal legislation or provincial carbon tax or cap and trade plan. On March 3, 2015 Prime Minister Trudeau and the provincial and territorial premiers announced, after a First Ministers’ meeting on climate change and the environment, that they were working toward a national climate change plan that included a carbon trading mechanism. No specifics of how it would work were provided. A working group has been struck to determinewhich of the mechanisms would be most effective and appropriate for each of the jurisdictions. The federal government is reviewing the environment assessment process under the Canadian Environmental Assessment Act 2012 and the National Energy Board Act to add two factors impacting the approval of project including upstream impacts and greenhouse gas emissions. It is also advocating for more Aboriginal involvement in reviewing and monitoring major resource development projects. The federal government has also announced that Canada will reduce its GHG emissions to 30 per cent below 2005 levels by 2030. To date no legislation has been proposed by the federal government limiting emissions. The following is a summary of federal Canadian legislation in this area: The Reduction of Carbon Dioxide Emissions from Coal-Fired Generation of Electricity Regulations (2012) (under the Canadian Environmental Protection Act 1*999* (CEPA)) set performance standards for carbon dioxide emissions from coal-fired electricity generation units. The performance level will be set at 420 tonnes of generation, such as high efficiency natural gas, renewable energy or fossil fueled power with carbon capture and storage. The Regulations Amending the Passenger and Light Truck Greenhouse Gas Regulations (2014) under CEPA build on the standards established under pre-exiting regulations which set GHG emission standards covering models years 2011–2016. The new Regulations set GHG emission standards for Canadian vehicles of model years 2017– 2025. The Heavy Duty Vehicle and Engine Greenhouse Gas Emissions Regulations (2013) under CEPA establish GHG emission standards for on-road heavy-duty vehicles and engines (e.g. buses, tractors and refuse trucks). The Renewable Fuels Regulations (2010) under CEPA are a key element of the Federal Government’s Renewable Fuels Strategy. The objective of the Regulations is to reduce GHG emissions by mandating an average 5 per cent renewable content based on the gasoline volume. The Federal Gas Tax Fund imposes as federal tax on gas which goes into a fund to provide funding to Canadian municipalities for local infrastructure projects. ### Quebec Quebec’s *Climate Change Action Plan and Adaption Strategy* *(2013-2020)* (2012) sets out its initiatives in the climate change area. The Quebec targets are 20% below 1990 levels by 2020, 37.5% below 1990 by 2030. Quebec has been a member of the Western Climate Initiative (“**WCI**”) since 2008 and linked its system with the California system on January 1, 2014. The Quebec cap and trade system applies to businesses that emit 25,000 metric tonnes or more of CO2e per year and will cover about 85% of Quebec’s emissions by 2015. The first compliance period (2013-2014) applied to the industrial and electrical sectors. The second compliance (2015-2017) and third compliance periods (2018 – 2020) will add distributions and importation of fuels used for consumption in the transport and building sectors as well as in small and medium sized businesses. Covered emitters buy 100% of their allowances at auction (or on the market). Allowances are auctioned up to four times per year (joint auctions are held with California). Some sectors subject to international competition will receive free allowances. Quebec set a floor price of $10.75 per tonnes in 2013 which increases at a rate of 5% plus inflation. With 2% inflation rate the price would be $17.20 a tonne in 2020. Some banking of allowances is allowed but no borrowing. Three domestic offset types are accepted as compliance units originating from projects carried out according to three “protocols”: CH4 destruction as a part of projects to cover manure storage facilities, capture of gas from certain landfill sites and destruction of certain ozone depleting substances contained in insulating foam recovered from appliances. There is a qualitative limit to 8% of each entity’s compliance obligation. Offsets issued by jurisdictions linked with Quebec will be recognized. The Quebec market is currently linked with California with special rules governing joint auctions for carbon credits. The Quebec *Regulation Respecting Mandatory Reporting of Certain Emissions of Contaminants into the Atmospher*e took effect in 2007. The Regulation applies to facilities that emit a contaminant listed in a schedule to the regulation. Any facility that emits more than 25,000 tonnes of CO2e must send in a verification report carried our by an accredited organization. ### Ontario The Ontario Government released its Cap and Trade Regulatory Proposal (Proposal) and Revised Guideline for Greenhouse Gas Emissions Reporting on 25 February 2016 for a 45-day comment period. The Proposal follows a MOU signed by the Ontario and Quebec Provincial Governments in April, 2015 to create a joint cap and trade system and a second MOU signed in the fall of 2015 to harmonise regulations needed to link the two carbon markets and develop common protocols for carbon offset credits. The Proposal covers two pieces of legislation, The Climate Change Mitigation and Low Carbon Economy Act(Act) and The Cap and Trade Program Regulations(Regulations) which prescribe a cap and trade system for Ontario (Cap and Trade Program) scheduled to come into force on January 1, 2017. The Act and Regulations are subject to consultation. The Act prescribes that proceeds from the Cap and Trade Program will be deposited into a Greenhouse Gas Reduction Account which will fund projects related to the reduction of emissions. The Act also enshrines GHGemissions reduction targets for Ontario: 15 per cent below 1990 levels by 2020, 37 per cent below 1990 levels by 2030 and 80 per cent below 1990 levels by 2050. Under the Act, large industrial emitters will get free allowances to produce GHGs at roughly current levels (2017) which are reduced each year to 2020. Only registered participants will be able to sell, trade or deal in the allowances and offset credits. The Act and the Regulations set out the details of the Cap and Trade Program: capped and uncapped (market) participants; compliance periods; registration rules; auction and sale rules; strategic reserve of allowances; market rules such as holding limits and purchase limits; compliance requirements; and allocations and credit for early action. A separate regulation will be introduced regulate offset credits. Amendments will be made to the Regulations to provide for linking with Quebec and California markets. To support the Cap and Trade Program, the Greenhouse Gas Emissions Reporting Regulation will be revoked and replaced with a new GHG reporting regulation under the Act. GHG emissions reduction targets in Ontario are: 15% below 1990 levels by 2020, 37% below 1990 levels by 2030 and 80% below 1990 levels by 2050. In the fall of 2015 the Ontario and Quebec governments signed MOU’s in the power and climate change areas (which built on MOU’s signed in 2014) to exchange electricity capacity, on market based mechanisms including harmonizing regulations needed to link the two carbon markets, and develop common protocols for carbon offset credits. Regulations under the Ontario *Environmental Protection Act* (“*Green Diesel – Renewable Fuel Content Requirements for Petroleum Diesel Fuel*”) require Ontario fuel suppliers to include at last 2% bio-based diesel to renewable bio-fuel made from soy and cooking oils in their products. The amount will rise from 3% in 2016 and 4% in 2017. ### Manitoba In December of 2015 Manitoba joined Ontario, Quebec and California and introduced a linked cap and trade system for 20 large emitters (*Memorandum of Understanding between the Government of Quebec, Ontario and Manitoba Concerning Concerted Climate Change Actions and Market Based Mechanisms 2015)*. Manitoba has also set a new target of reducing carbon emissions by 1/3 by 2030 and to be carbon neutral by 2080. The previous targets were set under the *Climate Change and Emissions Reductions Act* (2013) were not met. The Manitoba action plan – “*Manitoba’s Climate Change and Green Economy Action Plan*”(2015) calls for the province to use more renewable resources to reduce GHG’s including adopting green heating alternatives to fossil fuels such as geothermal technology. *The Emissions Tax on Coal and Petroleum Coke Act (2014)* imposed an emissions tax on the use of petroleum coke in industrial facilities. *The Coal and Petroleum Coke Ban for Space Heating Regulation* (under the *Environment Act*) phases in a ban on petroleum coke and coal for heating purposes beginning July 2014 with full compliance required by July 2017. ### British Columbia (“**BC**”) The BC government published its Climate Change Leadership Team’s Recommendation Report in late 2015which made 32 recommendations to reduce GHG emissions. BC has had a revenue neutral carbon tax since 2008 (*Carbon Tax Act*). The tax rates are based on a price of $30 per tonne of C02e. Further regulation in this area is expected in 2016. The *Greenhouse Industrial Reporting and Control Act* (2016) (“**GGIRCA**”) sets intensity based targets for certain industrial facilities including in the coal and liquefied natural gas industries. GGIRCA provides the authority for the *Emission Offsets Regulations* (2008) and the *Carbon Neutral Government Regulation* (2008). The *Greenhouse Gas Emission Reporting Regulation* (2016) under GGIRCA ensures that industrial polluters over 10,000 CO2e tonnes per year report their GHG emissions annually. Those operations emitting over 25,000 tonnes per year are required to have their reports independently verified. The *Greenhouse Gas Emissions Control Regulation* under GGIRCA establishes infrastructure and requirements for issuing emission offset units and funded units. The regulation also established the British Columbia Carbon Registry which will enable the issuance, transfer and retirement of compliance units (emission offset units, funded units and earned credits) on an electronic platform. The *Clean Energy Act* is designed to make BC self sufficient in electricity generation by 2016 with a clean and renewable energy target of 93%. The *Greenhouse Gas Reduction (Renewable and Low Carbon Fuel Requirements) Act* and the regulation thereunder require minimum fuel content by volume. ### Alberta In late 2015, the Alberta government announced a new Climate Change Plan (“*Climate Change Leadership Discussion Document*”) including an industry wide carbon tax which maintains the existing $30 per tonne level on large emitters and also introduces accelerated phase out of coal by 2030 which the new found capacity to be filled by renewable power, an economy wide carbon levy of C$20 per tonne beginning in 2017 to be increased C$30 per tonne in 2018 and followed by a 2% inflation rate thereafter and an absolute limit on oil sands emissions of 100 MT , a new methane gas emissions reduction plan (45% by 2025) and to phase out coal in the next 15 years. The Alberta government has had an intensity based carbon trading system in place since 2007 when it introduced the *Climate Change and Emissions Management Act* and the *Specified Gas Emitters Regulation.* The *Specified Gas Emitters Regulation* originally imposed incentive based limits on industrial GHG emissions by requiring reductions in emissions by large emitters (more than 100,000 tonnes of C02e annually) below a 2004-2005 baseline intensity or pay C$15.00 for each tonne exceeding the target. Compliance can be achieved by a number of methods: operating improvements; emission performance credits; purchases of verified emission offsets from private sellers; or the purchase of fund credits from the provincial government. In 2015 the Alberta government announced that by 2017 large emitters will have to reduce their GHGs by 20% and that the carbon levy will rise to C$30.00 per tonne. The Alberta government has not updated the existing targets of 50 MT below the business as usual projection by 2030. ### Saskatchewan Saskatchewan has a Climate Change Plan, which is designed to reduce GHGs by setting annual reductions targets for industry and encouraging investments in low carbon technologies. Under a the proposed framework, compliance mechanisms such as the Technology Fund, Recognition for Early Action, Pre- Certified Investments, and Emission Intensive Trade exposed credits and carbon offsets will be established to provide flexibility for regulated emitters to meet their GHG reduction obligations. Targets are 20% below 2006 levels by 2020 to be revised once a national strategy is put in place. The *Management and Reduction of Greenhouse Gases Act* (2010) once brought into force will require facilities that emit 50,000 or more tonnes of GHGs to reduce emissions to certain provincial standards which are to be determined. Industries that emit less than 50,0000 tonnes of GHGs annually are considered to be non regulated emitters. ### New Brunswick (“**NB**”) NB’s 2014-2020 *Climate Change Action Plan* (2014) establishes 2020 and 2050 GHG emission reduction targets of 10% below 1990 levels by 2020 and 75-85% below 2001 levels by 2050. The NB government has been publishing “progress reports” since 2007, which describe emission reduction activities across the province and developments on the adaption side. The NB government published *Guidelines for Greenhouse Management for Industrial Emitters in New Brunswick*, (2015) which are designed to assist industrial facilities in developing and adopting a GHG Management Plan as specified in approvals to operate under the *Air Quality Regulation* under the *New Brunswick Clean Air Act.* The NB *Electricity Act* requires that the provincial power authority secure 40% of its power acquired within NB from renewable sources by 2020. ### Nova Scotia The *Greenhouse Gas Emissions Regulations* (2009) established caps on the electricity sector and creates incentives for new transmission of carbon emission electricity. The *Renewable Electricity Plan* included a community feed in tariff program. Nova Scotia has a Climate Change Adaption Fund, is participating in the Atlantic Climate Adaption Solutions, which is a partnership between the four Atlantic Provinces and municipal associations and the federal government to deal with costal impacts and ground water changes from climate change. Nova Scotia also developed an Adaption Work plan and a five year work plan (2014-2019) to enhance the government’s ability to address climate change. Nova Scotia has finalized “*An Agreement on the Equivalency of Federal and Nova Scotia Regulations for the Control of Greenhouse Gas Emissions form the Electricity Producers of Nova Scotia”.* ### Prince Edward Island (“PEI”) The PEI Climate Change Strategy (2008) was designed to improve educational and public awareness around climate change issues, and reduce GHG emissions through the Office of Energy Efficiency, and enhance carbon sinks. PEI is developing wind as a renewable source of electricity and has fuel efficiency standards for government vehicles. ### Newfoundland and Labrador The Office of Climate Change and Energy Efficiency which has the lead responsibility for strategy and policy development in the areas of climate change, energy efficiency, and emissions trading, has published two planning documents: *Charting our Course – Climate Change Action Plan* (2011) which sets out a five year plan and develops a GHG strategy for the Energy Intensive Sector and prepares a climate change adaption plan for northern Labrador and *Moving Forward: Energy Efficiency Action Plan (*2011), which sets out sets an energy policy that is designed to reduce GHG emissions and local air contaminants. Newfoundland has also published a “*Greening Government Sustainability Innovation Collaboration 2015 Action Plan*” which is designed to demonstrate provincial leadership in the areas of climate change and energy efficiency and provides the provinces general framework for reducing greenhouse gas emissions. ### The Territories While each of the three territories: The Yukon, Northwest Territories and Nunavut have expressed plans to implement legislation to combat climate change, to date none of them have done so. Yukon published a climate change strategy in 2006 and two progress reports – one in 2012 and a second in December of 2015. The Yukon has also published a “*Pan Territorial Adaption Strategy*” and established the Northern Climate Exchange. The Northwest Territories has published a “*Northwest Territories Greenhouse Gas Emission Summary Report 2015*” as well as a “ *Greenhouse Gas Strategy for the Northwest Territories*” Nunavut has published “*Upagiaqtavut Setting the Course Climate Change Impacts and Adaption in Nunavut”* and opened a Climate Change Centre. Barbara Hendrickson has extensive experience in the carbon trading and offset development area in both the regulated and voluntary markets. Barbara has been ranked as one of the top 10 environmental finance lawyers in Canada by Law Day Leading Practitioners. For more information please see [Our Practice Climate Change.](https://lawfirmbarbara.wpengine.com/climate-change-carbon-trading) [](/climate-change-carbon-trading) **Categories:** News & Updates --- ### [Barbara Hendrickson Quoted in Investment Executive](https://baxsecuritieslaw.com/2016210barbara-hendrickson-quoted-in-investment-executive/) **Published:** February 8, 2016 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson Quoted in Investment Executive - "New Investment Options for your Clients""The introduction of a new offering memorandum (OM) prospectus exemption in Ontario on Jan. 13 makes raising capital easier for businesses. At the same time, the OM exemption creates new investment possibilities for... **Content:** [Barbara Hendrickson Quoted in Investment Executive – “New Investment Options for your Clients”](http://www.investmentexecutive.com/-/new-investment-options-for-your-clients) “***The introduction of a*** new offering memorandum (OM) prospectus exemption in Ontario on Jan. 13 makes raising capital easier for businesses. At the same time, the OM exemption creates new investment possibilities for your clients.” – [Read more…](http://www.investmentexecutive.com/-/new-investment-options-for-your-clients) **Categories:** News & Updates --- ### [Barbara Hendrickson is appointed the Canadian Contributing Editor of the International Energy Review](https://baxsecuritieslaw.com/2016216barbara-hendrickson-is-appointed-the-canadian-contributing-editor-of-the-international-energy-review/) **Published:** February 10, 2016 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson is appointed the Canadian Contributing Editor of the International Energy Review (“IELR”) examines the legal issues related to developments in the energy industry including coal, oil, gas, hydro, nuclear, and renewable energy. It provides expert articles, national reports from more than 20 key... **Content:** Barbara Hendrickson is appointed the Canadian Contributing Editor of the International Energy Review (“IELR”) examines the legal issues related to developments in the energy industry including coal, oil, gas, hydro, nuclear, and renewable energy. It provides expert articles, national reports from more than 20 key jurisdictions, country briefs, and interviews. It also discusses the significant growth in environmental issues affecting this area of the law. The journal is a well-established title from Thomson Reuters, trading as Sweet & Maxwell, with a wide readership globally and is widely read on the Westlaw online subscription service. Barbara Hendrickson is a well known practitioner in the climate change / carbon trading area and was ranked by *Law Day Leading Practitioners* as one of the top 10 environmental finance lawyers in Canada. [Please see Climate / Change Carbon Trading ](/climate-change-carbon-trading) [](/climate-change-carbon-trading) **Categories:** News & Updates --- ### [Environmental Finance Advisory Committee (University or Toronto) Submission on Bill 172 - Climate Change Mitigation and Low - Carbon Economy Act, 2016 - March 23, 2016](https://baxsecuritieslaw.com/201645environmental-finance-advisory-committee-university-or-toronto-submission-on-bill-172-climate-change-mitigation-and-low-carbon-economy-act-2016-march-23-2016/) **Published:** April 6, 2016 **Author:** Barbara Hendrickson **Excerpt:** March 24, 2016DELIVERED ONLINE AND BY COURIERMinistry of the Environment and Climate ChangeClimate Change and Environmental Policy DivisionAir Policy Instruments and Programs Design Branch77 Wellesley Street WestFloor 10Ferguson BlockToronto, OntarioM7A 2T5Attention: Melissa Ollevier Senior Policy AdvisorRE: EBR Registry Number 012-6844Dear Sirs/Mesdames:The following letter sets out... **Content:** March 24, 2016 **DELIVERED ONLINE AND BY COURIER** Ministry of the Environment and Climate Change Climate Change and Environmental Policy Division Air Policy Instruments and Programs Design Branch 77 Wellesley Street West Floor 10 Ferguson Block Toronto, OntarioM7A 2T5 Attention: Melissa Ollevier Senior Policy Advisor **RE: EBR Registry Number 012-6844** Dear Sirs/Mesdames: The following letter sets out the submissions of the University of Toronto’s Environmental Finance Advisory Committee (“**EFAC**”) on the proposed Bill 172 “Climate Change, Mitigation and Low-Carbon Economy Act, 2016” (“**Bill 172**” or “**CCMLEA**”) and the proposed regulation to be made under Bill 172 (“**Proposed Regulation**”). By way of background, EFAC serves as a forum for the exchange of innovative ideas in environmental finance between the University of Toronto and the commercial sector, thereby providing professional development and networking opportunities. The Committee operates through the contributions of insight, time, and effort from experts and advisors who represent the intended audience of business and industry leaders, as well as academics and students. At the outset, EFAC supports “putting a price on carbon” to help reduce greenhouse gas (“**GHG**”) emissions. We believe that a key advantage of the pricing system chosen by Ontario, cap and trade, ‎is its promise to achieve the same volume of emission reductions at a lower cost to the economy than other systems, including a carbon tax. At its root, this promise is based on the ability of entities able to make GHG emission reductions at the lowest possible cost to do so and be rewarded by the ability to trade those reductions or the instruments (allowances and offsets) that enable or represent them to others which could make equivalent reductions at a higher cost. The market is designed to operate efficiently so that GHG emission reductions can be achieved at the least cost. “An efficient market means that allowance and offset credit prices reflect supply and demand, and accurately reveal the value of allowances and offset credits.”[\[1\]](#_ftn1) Consequently the ability to efficiently trade instruments related to those emission reductions, whether allowances or credits, as defined in CCMLEA, is a critical factor in achieving a liquid, well financed, balanced and transparent carbon market. Our comments on Bill 172 and the Proposed Regulation are set out below. In this regard, we have endeavored, as much as practicable, to match our comments to the section order set out first, in Bill 172, and then in the Proposed Regulation. 1\. Definitional Matters – Legal Characterization of Allowances/Credits Section 1 of Bill 172 sets out definitions for “credit”, “emissions allowance”, “Ontario credit” and “Ontario emissions allowance” which avoid reference to the legal characterization of these new assets. In our view, it is fundamental to the healthy development of an emissions trading market for those who are permitted to acquire, hold, trade and surrender credits and allowances (including those created in Ontario) to have certainty with respect to their precise legal nature. It is only with that clear understanding that they can evaluate holding and trading risks and develop risk mitigation strategies. For capped emitters themselves, and for those who develop and operate projects intended to generate offset credits, it is also fundamental in understanding the nature of these assets for purposes such as their valuation and treatment for accounting purposes, and their potential use as credit enhancement or financing tools. In Ontario, where definitive legal characterization is not found in a statute, parties looking for certainty can only look to common law jurisprudence. While it is arguable that credits and allowances (including those created in Ontario) may be capable of being found to constitute property, there can be no certainty of whether they would be found to be characterized as such for important purposes such as personal property security legislation or insolvency legislation. In our view, the needed certainty under applicable Ontario law could be provided by making it explicit in the legislation and regulation that credits and allowances (including those created in Ontario) constitute personal property. This, indeed, is an approach which has also been explicitly adopted in many jurisdictions, including certain member countries of the EU ETS, New Zealand and certain US states. This approach, we believe, will promote confidence and integrity in the development of a market, while at the same time reducing uncertainty for holders of credits and allowances. We are aware, as you will be, that California did not adopt this approach in structuring its enabling cap and trade legislation. We understand, however, that there was a valid, uniquely US law concern, which motivated that choice. As you will know, California’s system permits the regulator to void, revoke or invalidate credits in certain circumstances, and, under California law, a government which ‘takes’ personal property is required to do so by making or providing just compensation to the affected party. California did not wish to invoke that legal requirement to compensate in those circumstances. That principle of California law is not, however, and has never been, the law of Ontario. In our province, instead, it is well settled law that no such principle with respect to personal property rights or licenses exists independently of a statute – and that if a statute specifically empowers a revocation, termination or forfeiture, it can do so on any basis which the legislature determines. Accordingly, we believe that the Government of Ontario should not regard California’s choice as determinative – particularly when there are clear benefits to Ontarians of making it clear that credits and allowances are personal property rights. 2\. Certain Mandatory Participants – Obligation to Cover Natural Gas and Fuel ‎GHG Emissions Under Bill 172 and the Proposed Regulation, GHG emissions from the combustion of natural gas and petroleum products will largely need to be covered‎ (i.e. matched by emission allowances and or credits acquired and surrendered to the Ontario government) like GHG emissions emitted by large facilities. In both the case of natural gas and the case of petroleum products (e.g. gasoline, diesel and propane), the emissions are diffuse, occurring in the course of heating individual homes or driving cars, trucks and other vehicles. For practical reasons, the Proposed Regulation allocates that responsibility to the distributors of natural gas and petroleum products, providing these entities with the ability to drive the demand for allowances/credits and to control or at least significantly influence the market. This is compounded by the fact that the Proposed Regulation contemplates that industrial facilities in Ontario (but not natural gas distributors) will receive free allowances for the first compliance period (2017 to 2020). We believe that demand and therefore the carbon market in Ontario will likely be driven by the needs of natural gas and petroleum products distributors. We note that, in comparison, the cap and trade systems of Quebec and California, with which Ontario hopes and expects to link, create a different result within their respective jurisdictions. We note that Quebec has very little gas-fired generation while Ontario has very significant gas-fired generation. In Ontario, under the Proposed Regulation, gas-fired generators, except for those connected to interprovincial or international pipelines, will have their emissions covered by the upstream natural gas distributor. As a result, natural gas distributors in Ontario can be expected to drive a much bigger portion of the demand relative to Quebec, and certainly relative to California, where the gas generators have their own compliance obligation. We believe that Ontario should examine this issue with a view to reducing the potential market influence of the large natural gas distributors on the carbon markets in Ontario, which, we believe, in turn will create a more rational market for allowances and credits in Ontario. 3\. Cap and Trade Accounts and Transactions – Separation of Beneficial and Registered Ownership of Allowances and Credits Section 27(2) of the CCMLEA provides, in effect that, except as otherwise permitted by regulation, “No registered participant shall hold in the participant’s cap and trade account an emission allowance or credit that is owned, directly or indirectly, by another registered participant” (“**Beneficial Interest Prohibition**”). In our view, the Beneficial Interest Prohibition, which ‎we presume is designed to prevent undisclosed ownership relationships from existing and to protect the markets from abusive arrangements that concentrate market power or facilitate fraud, is arguably not necessary. The carbon markets are commodity markets not unlike the energy markets in which commodities, securities and derivatives are trading on a spot and forward basis. No similar ‎prohibition exists in those markets and it is unclear to us why such a prohibition is necessary for the carbon markets. We note that the efficient operation of a market benefits from, and cannot be achieved without, market participants deepening liquidity and arbitraging inappropriate price differentials using an almost unlimited range of strategies and arrangements. Where these efforts result in undesirable market behaviors in other commodity markets, regulators step in to limit or prohibit those activities under broad powers relating to the prevention of market manipulation (which we believe is also contained in Sections 28(1) and (2) of Bill 172). Moreover it is frequently the case that disclosure of activities is a sufficient deterrent rather than a market-constraining prohibition. We suggest that this approach which is used in the non-carbon markets be adopted and the Beneficial Interest Prohibition be eliminated. We also draw to your attention that this approach has not been adopted in other carbon markets such as the EU ETS or the rules relating to the creation and trading of Kyoto credits. One of the arrangements that has proven to be very helpful for participants in the Kyoto Protocol and EU carbon markets has been the use of custodians and escrow agents for carbon allowances and credits. For example, when a large purchase and sale of such Kyoto credits is to be effected, the buyer will be unwilling to transfer the funds until the carbon credits are transferred to avoid the “fail to transfer b‎ut keep the money” risk. Financers of the buyer’s purchase will be even more adverse to this risk. Sellers will not be prepared to transfer the credits to the buyer until there is certainty of payment, i.e. “the money is in the bank”. Placing the credits with a depositary or escrow agent which is well capitalized and familiar with this type of transaction is the preferred approach. But this requires the registered interest in the credits (which needs to be with the depository or escrow agent) to be separated from the beneficial interest (which needs to be with the seller until consideration is paid and then must be moved to the buyer). Other commodity markets do deal with this issue by allowing the registered interest in the commodity to be separated from the beneficial interest. Transactions in these markets are based on the ability of registered interests to be deposited with the depositary or escrow agent in the name of the seller pending payment of the purchase price and transfer of the beneficial interest is to the buyer. In addition, we believe that where credits from an offset project are presold to a variety of purchasers, some of whom may have provided finance for the project, it is also essential that there be an ability to split beneficial and legal ownership and deposit the registered ownership with a depository or escrow arrangement. Buyers will want the registered interest to be deposited in escrow and will be unwilling to risk the offset credits being issued to an offset project developer which may be poorly capitalized who has granted security interests in favour of third party creditors. In our view, allowing these arrangements is essential to the operation of a carbon market. We believe that elimination of the Beneficial Interest Prohibition would be beneficial; the alternative is extensive use of the provisions of the regulation to provide needed exceptions, which we believe would create unneeded complexity. In this context, we would also point out that California, presumably with the same legislative policy intent as Ontario, has drafted its comparable restriction in a manner which better facilitates commercial transactions. “95921. Conduct of Trade (f) General Prohibitions on Trading. (1) An entity may purchase and hold compliance instruments for later transfer to members of a direct corporate association. However, an entity cannot acquire allowances and hold them in its own holding account on behalf of another entity, including the following restrictions: (A) An entity may not hold allowances in which a second entity has any ownership interest. (B) An entity may not hold allowances pursuant to an agreement that gives a second entity control over the holding or planned disposition of allowances while the instruments reside in the first entity’s accounts or control over the acquisition of allowances by the first entity. *Provisions specifying a date to deliver a specified quantity of compliance instruments, or specifying a procedure to determine a quantity of compliance instruments for delivery and/or a delivery date, do not violate the prohibition*.” (Emphasis added). Our comments above lend themselves as well to related comment on the note contained in Section 17 of the Proposed‎ Regulation which contemplates permitting the participation of “clearing houses” to “provide clearing services for transactions between registered participants”. Generally clearing services consist of matching buy and sell orders and often involve settlement as well, with settlement being the acts of transferring the subject matter of the transaction from the buyer to the seller and the transfer of funds from the seller to the buyer. The Proposed Regulation requires that an entity that wishes to be a clearing house for Ontario cap and trade purposes be registered with the MoECC and “recognized by a regulatory authority responsible for supervising financial markets in Canada” with ongoing oversight by that regulatory authority. We believe that the inclusion of a ‎proposal for permitting credit clearing houses is a positive and, in fact, a necessary component of a functioning carbon market. However the note to section 31 of the Proposed Regulation significantly undermines the utility of a clearing house by prescribing that allowances/offsets can only be held for five days and restricting transfers between registered participant sellers and buyers. In our view, these limitations are unnecessarily restrictive, even for specific known-in-advance transactions which often have preconditions and delays that extend the time beyond five days and may require transfers other than to registered buyers, for example, transfers to partnerships, limited partnerships and trusts where undivided interests in the allowances/credits are in fact held directly by the partners or trust unit holders. Other arrangements such as unincorporated arrangements (tenancy in common and unincorporated associations) also employ a principal/agent structure, which would not be accommodated under the Proposed Regulation. We suggest the traditional services structures in non-carbon commodity markets offered by trust companies and depositaries (regulated under the terms of other legislation) be available to participants in the carbon markets on the same terms. 4\. Trading where undisclosed change; Misleading or untrue statements Section 28 of Bill 172 contains provisions respecting potential market abuses including insider trading and market manipulation. We generally agree that these provisions are necessary to deal with issues related to the new carbon markets. An essential component of effective regulation in this area to ensure that market participants have the information necessary to conduct trades. This is critical to the effective functioning of any market. This can be accomplished by requiring that participants (including the Government of Ontario) in the carbon markets make public certain “inside” information in a timely manner. Successful regulation in this area will require a balance between making public, certain information which is needed to participate in the carbon market and restrictions on parties not to trade on information which is not otherwise publicly available and which would provide an unfair advantage to one party leading to manipulative market practices. This concept is set out in the WCI White Paper: “Transparency in the design and the operation of the allowance and offset credit market builds and retains public confidence. Reporting of relevant information to regulatory authorities and public disclosure of information has important benefits. It enables regulatory authorities to conduct effective oversight and ensure compliance. It also helps to ensure market efficiency, effective oversight, and compliance and enforcement. The release of information can change the decisions of market participants, which impacts the prices of allowances and offset credits. Timely, accurate, coordinated and consistent release of market-relevant information allows all market participants to have equal access to public information. The reporting and disclosure requirements for compliance verification and enforcement balance these benefits against the need for entities to protect certain sensitive information. The potential to disclose certain information that could be used to manipulate the market is also considered. This balancing is consistent with applicable law relating to the disclosure of information.” In order for such provisions in Bill 172 to be effective they should apply only to regulated participants (i.e., capped participants and market participants), impose a disclosure obligation on these participants; restrict trading by persons who have a connection or relationship to entities about whom the information relates (through insider lists or establishing relationship categories) and allow persons to acquire the information that they require for rational trading activity. In our view, certain provisions in Bill 172 have not met these standards and, indeed, have gone too far and may create a situation where informational requirements for rational trading activities cannot be met. In particular, we believe that Sections 28(5) and 28(6) of Bill 172 are too far-reaching and ultimately may be extremely difficult to enforce. Section 28 appears to be an attempt to emulate certain provisions found in the Securities Act (Ontario) (“**OSA**”); however, in our view, they diverge materially from the OSA provisions. Section 28(5) of Bill 172 applies to “any person” whereas the equivalent provisions in section 76(1) of the OSA apply to a person in a “special relationship”[\[2\]](#_ftn2) with a “reporting issuer” (i.e., a public company). Persons or companies in a special relationship are a prescribed class of individuals. The provisions in the OSA are designed to prohibit individuals who have a preexisting relationship with a reporting issuer from trading using knowledge of “a material fact or material information” with respect to the reporting issuer that has not been generally disclosed. (Definitionally, “material” information and changes are those relating to the issuer that would reasonably be expected to have a significant effect on the market price or value of any of the securities of the issuer.) In contrast, Section 28(5) of Bill 172 imposes this obligation on persons with no preexisting relationship with the owners of the emission allowances or credits and on information of a broad and undefined character, however acquired. Notably, the OSA provisions apply to “reporting issuers”[\[3\]](#_ftn3) and not to all issuers in the Ontario markets. Reporting issuers have public disclosure obligations under the OSA; in contrast carbon market participants under Bill 172 are not subject to any such comparable obligations. The OSA imposes a duty on reporting issuers to disclose “material information” and “material changes”. These provisions are designed to ensure that all participants in the market trade on the same information. There is no duty to disclose information under Bill 172; in fact the opposite appears to be true. See also the provisions prohibiting the disclosure of any information prior to an auction (Sections 31(6) and (7) of Bill 172). Since there is no similar requirement for disclosure under Bill 172 this means that trading would have to take place in a vacuum with imperfect information. We note, in addition, that Sections 28(3) and (4) prohibit the making of certain statements; what constitutes a “statement” is not defined (i.e., the medium and context) nor to whom such a statement cannot be made. As well, the prohibition applies to “any person”, no matter how engaged, if at all, in the trading of allowances or credits. In contrast, under the OSA, offences and civil liability for misleading statements are premised on concepts that are tightly defined and rigorous, both for certainty and transparency purposes. Arguably all of the above provisions would have the effect of undermining the purpose of “market mechanism” and no true market for the emission allowances and credits could develop in Ontario. We suggest, in the alternative to the approach in Bill 172, an approach to regulation like that set out in section 95921(e) of the California cap and trade system regulations which attempts a more principled and differentially tighter approach to regulation in this area: “Section 95921 Conduct of Trade (e) General Prohibitions on Trading: A trade involving, related to, or associated with any of the following are prohibited: (A) Any manipulative or deceptive device in violation of this article; (B) A corner or an attempt to corner the market for a compliance instrument; (C) Fraud, or an attempt to defraud any other entity; (D) A false, misleading or inaccurate report concerning information or conditions that affects or tends to affect the price of a compliance instrument; (E) An application, report, statement, or document required to be filed pursuant to this article which is false or misleading with respect to a material fact, or which omits to state a material fact necessary to make the contents therein not misleading; or (F) Any trick, scheme, or artifice to falsify or conceal a material fact, including use of any false statements or representations, written or oral, or documents made by or provided to an entity on or through which transactions in compliance instruments occur, are settled, or are cleared. (G) A fact is material if it could probably influence a decision by the Executive Officer, the Board, or the Board’s staff.” 5\. Intensity Caps Section 21 of the Proposed Regulation contemplates a mechanism to deal with an “unexpected production increase that increases emissions by 250k tonnes/yr. or more”, which accommodates increased emissions without an increase in intensity. In our view, a downside adjustment is desirable so a lower cap would apply where production multiplied by a constant (or even slightly declining) intensity produces a lower number than the straight-line reducing cap as is contemplated in the Proposed Regulation. 6\. Trueups In our view, it is possible that problems may arise with the contemplated 2021 one-time trueup‎. California uses a partial trueup along the way to keep emitters from digging a huge hole over the compliance period that swallows them at the end without making reductions. Another technique for consideration would see 2017 (or even a less attractive alternative of 2017 and 2018) as its own compliance period with very little reduction required to give the emitters “practice with training wheels” and kick start the market while delaying the real compliance pain until 2021 as is currently contemplated. 7\. Offset Markets – Timing of Regulation and Development of Protocols We encourage the Province of Ontario to move as quickly as possible with the draft offset regulation and protocol development in order to create the missing link for the development of a robust emissions trading market in Ontario and beyond. Much work has been done in this regard, in particular, under the WCI umbrella working groups and by British Columbia, Alberta, California and Quebec, and we urge the Province to take advantage of this work in the ultimate design. 8\. Ensuring Consistency of Legislation across WCI Jurisdictions We emphasize the need for Ontario to be kept abreast of ‎proposed and pending changes in other jurisdictions including California (and vice versa) and for the Ontario Government to participate directly in consultations in those other jurisdictions and when needed, to institute parallel consultations in Ontario. We note, in particular, that as we submit these comments, California is already well underway in a process that may result in significant amendments to provisions of their cap-and-trade system which are the same or substantially similar to provisions in the CCMLEA and the Proposed Regulation. On behalf of EFAC, yours very truly, **Barbara Hendrickson** BAX Securities Law Suite 720, 40 University Avenue Toronto, OntarioM5J 1T1 T: 416.594.0791 ext. 146 E: bhendrickson@baxsecuritieslaw.com **Patricia A. Koval** Torys LLP 79 Wellington Street West 30th Floor Box 270, TD South Tower Toronto, OntarioM5K 1N2 T: 416-865-7356 E: pkoval@torys.com **Gray Taylor** Barrister and Solicitor GRAY TAYLOR LAW 130 King Street West Exchange Tower, Suite 3670 Toronto, OntarioM5X 1E2 T: 416 786 5533 E: gray@graytaylorlaw.com [\[1\]](#_ftnref1) Western Climate Initiative Market Oversight White Paper, November 18, 2009 page 3 [\[2\]](#_ftnref2) “person or company in a special relationship with an issuer” means, (a) a person or company that is an insider, affiliate or associate of (“insider” includes a person or company that would be an insider of an issuer if the issuer were a reporting issuer), (i) the issuer, (ii) a person or company that is considering or evaluating whether to make a take-over bid, as defined in Part XX, or that proposes to make a take-over bid, as defined in Part XX, for the securities of the issuer, or (iii) a person or company that is considering or evaluating whether to become a party, or that proposes to become a party, to a reorganization, amalgamation, merger or arrangement or similar business combination with the issuer or to acquire a substantial portion of its property, (b) a person or company that is engaging in any business or professional activity, that is considering or evaluating whether to engage in any business or professional activity, or that proposes to engage in any business or professional activity if the business or professional activity is, (i) with or on behalf of the issuer, or (ii) with or on behalf of a person or company described in subclause (a) (ii) or (iii), (c) a person who is a director, officer or employee of, (i) the issuer, (ii) a subsidiary of the issuer, (iii) a person or company that controls, directly or indirectly, the issuer, or (iv) a person or company described in subclause (a) (ii) or (iii) or clause (b), (d) a person or company that learned of the material fact or material change with respect to the issuer while the person or company was a person or company described in clause (a), (b) or (c), (e) a person or company that learns of a material fact or material change with respect to the issuer from any other person or company described in this subsection, including a person or company described in this clause, and knows or ought reasonably to have known that the other person or company is a person or company in such a relationship; [\[3\]](#_ftnref3) “issuer” means, (a) a reporting issuer, or (b) any other issuer whose securities are publicly traded; **Categories:** News & Updates --- ### [Barbara Hendrickson to speak at the University of Toronto’s Environmental Finance Advisory Committee’s TODAY'S NEW AND DEVELOPING CARBON MARKETS on June 3, 2016](https://baxsecuritieslaw.com/201652barbara-hendrickson-to-speak-at-the-university-of-torontos-environmental-finance-advisory-committees-todays-new-and-developing-carbon-markets-on-june-3-2016/) **Published:** May 2, 2016 **Author:** Barbara Hendrickson **Excerpt:** TODAY'S NEW AND DEVELOPING CARBON MARKETSAround the globe, initiatives to price carbon, including cap-and-trade systems, are proliferating at a rapid pace. The Development of carbon markets, including potential new markets, market mechanisms, and market participants is occurring at an almost dizzying rate. Join The University of... **Content:** ![](http://static1.squarespace.com/static/538ccb7ee4b0c9bb1896333b/538ccc06e4b021ab8ae2b852/572b48f92fe1318ba490c761/1462454603520//img.png) **TODAY’S NEW AND DEVELOPING CARBON MARKETS** Around the globe, initiatives to price carbon, including cap-and-trade systems, are proliferating at a rapid pace. The Development of carbon markets, including potential new markets, market mechanisms, and market participants is occurring at an almost dizzying rate. Join The University of Toronto’s Environmental Finance Advisory Committee for a lively and comprehensive update on all of these developments and more in Canada and elsewhere. **Date:** Friday, June 3rd, 2016 **Registration:** $49.00 plus HST. Register on Eventbrite HERE **Event Time:** 8:30 a.m. to 5:00 p.m. Registration begins at 8:00 a.m. **Where:** Torys LLP, 79 Wellington Street West, 33rd Floor, TD South Tower, Toronto **Refreshments:** A light breakfast will be available from 8:00 a.m. Lunch is also included. 8:00 a.m. – 8:25 a.m. Breakfast and Registration **Day Moderator: Patricia A. Koval, Partner, Torys LLP** 8:25 a.m. OPENING REMARKS **Gray Taylor, Gray Taylor Law** 8:30 a.m. – 9:30 a.m. THE PARIS DEAL AND CANADA - Status and developments since December 2015. - What does it really mean for carbon markets? For finance? - How will the Kyoto offset mechanisms and the work done to develop and administer those programs potentially factor in implementation of the new agreement? - What is Canada’s role in the international process now? Canada’s NDC: What does it mean and how will Canada rely on markets to meet its climate target? - Status of the Federal efforts to put a price on carbon (overview). **Katie Sullivan, Canadian Director, IETA** 9:30 a.m. – 10:30 a.m. PRIORITY INTERNATIONAL MARKETS - Status of the EU ETS and EU 2030 climate and energy targets. - The California carbon market – status and outlook? - Regional Greenhouse Gas Initiative (RGGI) – status and outlook? - U.S. Federal – status and outlook? Other U.S. States? - China – cap-and-trade pilots and plans for a national Chinese cap-and-trade system. - Other market updates. **MORNING BREAK** 10:30 a.m. – 10:50 a.m. **Barbara Hendrickson, BAX Securities Law** 10:50 a.m. – 11:50 a.m. CANADA’S EXISTING CARBON MARKETS - Overview of Canadian Markets including role of Federal Government Initiatives. - Updates on the Provinces – Quebec, Alberta, BC, Manitoba and Saskatchewan. - Where is the trading occurring in Canada – regulated and OTC. - Regulation of Canadian carbon markets – interaction of environmental compliance regimes and securities and commodities regimes. **Morning Wrap-Up** 11:50 p.m. – 12:15 p.m. - Question and Answer Session **LUNCH** 12:15 p.m. – 1:15 p.m. **Patricia A. Koval, Partner, Torys LLP** 1:15 a.m. – 2:15 p.m. ONTARIO’S NEW CAP AND TRADE SYSTEM - Status – Timing of the legislation and regulations. - Overview of its intended operation and issues that we can expect to see. - Status of development of the offset protocols and offsetting generally. - When will linking with Quebec and California occur? **Rob Wilson** Director, Carbon Finance Nature Conservancy of Canada 2:15 p.m. – 3: 15 p.m. THE VOLUNTARY AND PRE COMPLIANCE MARKETS FOR OFFSET CREDITS IN CANADA - How are the voluntary markets operating in Canada? Status, standards and processes? - The special case of forestry offsets – what is happening across Canada. - The growing importance of “co-benefits”. - Key carbon offset project design considerations and examples. - Transforming early action and other voluntary offsets into compliance offsets. **AFTERNOON BREAK** 3-15 p.m. – 3:30 p.m. **Julie Desjardins, Director, Reporting & Capital Markets Research, Guidance & Support Chartered Professional Accountants of Canada** 3:30 p.m. – 4:30 p.m. CARBON AND THE CAPITAL MARKETS: GOVERNANCE, ACCOUNTING, TAX TREATMENT AND DISCLOSURE - Update on Federal income tax proposals, commodity tax experience and Canadian accounting protocols and developments. - Developments in climate and carbon risk disclosure, including current initiatives in Canada and the U.S. - Governance considerations in the new low carbon economy. **Afternoon Wrap-Up** 4:30 p.m. – 5:00 p.m. Question and Answer Session **Categories:** News & Updates --- ### [CSA requires use of SEDAR for Certain Exempt Market Filings, May 12, 2016](https://baxsecuritieslaw.com/2016516csa-requires-use-of-sedar-for-certain-exempt-market-filings-may-12-2016/) **Published:** May 17, 2016 **Author:** Barbara Hendrickson **Excerpt:** Effective May 24th, 2016, the members of the Canadian Securities Administrators (CSA) except for British Columbia and Ontario (participating jurisdictions) will require that exempt market offering and disclosure filings be made on the System for Electronic Document Analysis and Retrieval (SEDAR).This reflects the adoption of... **Content:** Effective May 24th, 2016, the members of the Canadian Securities Administrators (CSA) except for British Columbia and Ontario (participating jurisdictions) will require that exempt market offering and disclosure filings be made on the System for Electronic Document Analysis and Retrieval (SEDAR). This reflects the adoption of amendments by the CSA of *Multilateral CSA Notice of Amendments to National Instrument 13-101 System for Electronic Data Analysis and Retrieval (SEDAR)* and *Multilateral Instrument 13-102 System Fees for SEDAR and NRD*. The amendments will require that the following documents be filed electronically on SEDAR in the participating jurisdictions: - Form 45-106F1 Report of Exempt Distribution excluding Schedules Schedules 1 and 2. - Material to be filed or delivered under s. 2.9 of National Instrument 45-106 *Prospectus Exemptions* (NI 45-106) including the offering memorandum and any other document, such as financial statements or marketing materials. that may be required in the future to be filed or delivered under section 2.9 - In Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia, the offering document and Form 5 Report of Exempt Distribution under the start-up crowdfunding prospectus and registration exemptions. - Offering documents, distribution materials, annual financial statements, notice of use of proceeds under Multilateral Instrument 45-108 *Crowdfunding*. - In Québec, a disclosure document delivered to subscribers is required to be filed under section 37.2 of the *Securities Regulation* (Québec). - Financial statements of “mutual funds in the jurisdictions” as defined in National Instrument 81-106 *Investment Fund Continuous Disclosure*. Exempt market filings being made electronically in British Columbia and Ontario will either have to make their filings through the BCSC eServices portal in British Columbia or the Electronic Filing in Portal in Ontario. A long-term project is under way to create a single Canadian disclosure filing system. Exempt market filings can be made on a voluntary basis on SEDAR before May 24th, 2016. Effective May 24th, 2016 a mandatory $25 fee will apply to all exempt market filings made on SEDAR. The CSA published a notice on April 26, 2016 which sets out a number of frequently asked questions related to these filings: *[Multilateral CSA Staff Notice 13-323, Frequently Asked Questions About Making Exempt Market Filings on SEDAR](http://www.fcaa.gov.sk.ca/adx/aspx/adxGetMedia.aspx?DocID=9367,1382,1369,1364,2259,2257,244,1,Documents&MediaID=22d93f17-7634-440c-b5ce-2947b647b3cd&Filename=13-323-csa-staff-notice-april-21-2016.pdf)* is posted on websites of the participating jurisdictions. 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.* > **Categories:** News & Updates --- ### [CSA Adopts Fundamental Changes to Early Warning and Take-over Bid Regimes, May 9, 2016](https://baxsecuritieslaw.com/2016517csa-adopts-fundamental-changes-to-early-warning-and-take-over-bid-regimes-may-9-2016/) **Published:** May 17, 2016 **Author:** Barbara Hendrickson **Excerpt:** On February 25, 2016, the Canadian Securities Administrators (CSA) published the amendments to:Multilateral Instrument 62-104 Take-Over Bids and Issuer Bid (MI 62-104);National Instrument 62-103 The Early Warning System and Related Take-Over Bid and Insider Reporting Issues (NI 62-103); andNational Policy 62-203 Take-Over Bids and Issuer... **Content:** On February 25, 2016, the Canadian Securities Administrators (CSA) published the amendments to: - Multilateral Instrument 62-104 *Take-Over Bids and Issuer Bid* (MI 62-104); - National Instrument 62-103 *The Early Warning System and Related Take-Over Bid and Insider Reporting Issues* (NI 62-103); and - National Policy 62-203 *Take-Over Bids and Issuer Bids* (NP 62-203). **Changes to the Early Warning Regime** Amendments were made to the early warning reporting regime as set out in MI 62-104, NI 62-103 and NP 62-203. In Ontario, amendments were also made to Part XX of the *Securities Act* (Ontario) respecting the early warning regime and OSC Rule 62-504 *Take-over and Issuer Bids* (OSC Rule 62-504) (together the Early Warning Amendments). The Early Warning Amendments came into effect on May 9th, 2016. Ontario has adopted the NI 62-104 and OSC Rule 62-504 has been repealed. According to the CSA, the Early Warning Amendments provide greater transparency about significant holdings of reporting issuers’ holdings under the early warning system and address growing concerns regarding hidden ownership and empty voting. The Early Warning Amendments: - require disclosure of decreases in ownership, control or direction of 2% or more; - require disclosure when ownership, control or discretion falls below the 10% threshold; - exempt lenders from including securities lent or transferred for the purposes of determining the early warning reporting threshold trigger if they lend securities pursuant to a specified securities lending arrangement; - require disclosure regarding the material terms of any related financial instruments, any securities lending arrangements, and other arrangements or agreements involving securities; - make the alternative monthly reporting system unavailable to eligible institutional investors who solicit proxies from securityholders in order to contest director elections, reorganizations, amalgamations, merger arrangements or similar corporate actions involving the securities of the reporting issuer; - require disclosure in the early warning report of an interest in a related financial instrument, a securities lending arrangement, and other agreement, arrangement or understanding in respect of a security of the class of securities for which disclosure is required; - enhance the disclosure in the early warning report by requiring more detailed information regarding the intentions of the acquiror and the purpose of the transaction; - require the early warning report to be certified and signed; - clarify the timeframe to issue and file a news release and an early warning report (to be issued no later than the opening of trading on the next business day); and - further streamline the information required in a news release filed in connection with the early warning reporting requirements. The Early Warning Amendments also clarify the application of early warning reporting requirements to certain derivative arrangements and to securities lending arrangements. The CSA opted to retain the 10% reporting threshold (rather than reducing it to 5% as was earlier proposed.) The forms setting out the required disclosure have also changed. Please see new forms 62-103F1, 62-013F2 and 62-103F3. **Changes to the Take-Over Bid Regime** The CSA adopted amendments to the regime governing the conduct of take-over bids set out in MI 62-104 and changes to NP 62-203 which governs take-over bids and issuer bids. In Ontario, amendments will also be made to Part XX the *Securities Act* (Ontario) and OSC Rule 62-504 (together the Take-Over Bid Amendments). The Take-over Bid Amendments came into effect on May 9th, 2016. According to the CSA, the Take-over Bid Amendments will enhance the quality and integrity of the take-over bid regime and rebalance the current dynamics among offerors, offeree issuer boards of directors (offeree boards), and offeree issuer security holders by (i) facilitating the ability of offeree issuer security holders to make voluntary, informed and co-ordinated tender decisions, and (ii) providing the offeree board with additional time and discretion when responding to a take-over bid. The Take-over Bid Amendments will require that all non-exempt take-over bids: - receive tenders of more than 50% of the outstanding securities of the class that are subject to the bid, excluding securities beneficially owned, or over which control or direction is exercised, by the offeror or by any person acting jointly or in concert with the offeror (Minimum Tender Requirement); - be extended by the offeror for an additional 10 days after the Minimum Tender Requirement has been achieved and all other terms and conditions of the bid have been complied with or waived (10 Day Extension Requirement); and - remain open for a minimum deposit period of 105 days unless (a) the offeree board states in a news release a shorter deposit period for the bid of not less than 35 days, in which case all contemporaneous take-over bids must remain open for at least the stated shorter deposit period, or (b) the issuer issues a news release that it intends to effect, pursuant to an agreement or otherwise, a specified alternative transaction, in which case all contemporaneous take-over bids must remain open for a deposit period of at least 35 days. There are certain exceptions to the 105 day deposit requirement including where the target announces that it has agreed to be acquired pursuant to a plan of arrangement or similar corporate transaction and bids outstanding at the time of the announcement and future bids commenced before the completion of the transaction or the expiry of any other previous bid will be subjct to a 35 day deposit period. Under the previous regime non exempt take-over bids only remained open for 35 days and there were no minimum tender requirements or an extension requirement once the bidder had taken up deposited securities. No amendments are being made to National Policy 62-202 *Defensive Tactics* which will continue to apply. The CSA noted that “Securities regulatory authorities will be prepared to examine the actions of the offeree boards in specific cases, and in light of the amended bid regime, to determine whether they are abusive of security holders rights.” 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. **Categories:** News & Updates --- ### [New Harmonized Exempt Distribution Reporting Structure, May 20th, 2016](https://baxsecuritieslaw.com/2016529new-harmonized-exempt-distribution-reporting-structure-may-20th-2016/) **Published:** May 30, 2016 **Author:** Barbara Hendrickson **Excerpt:** With the amendments to National Instrument 45-106, Prospectus Exemptions, the Canadian Securities Administrators (CSA) are introducing a new harmonized reporting structure (the New Reports) for exempt distributions, effective June 30, 2016 (subject to ministerial approval). The CSA is also making changes to Companion Policy 45-106,... **Content:** With the amendments to National Instrument 45-106, Prospectus Exemptions, the Canadian Securities Administrators (CSA) are introducing a new harmonized reporting structure (the New Reports) for exempt distributions, effective June 30, 2016 (subject to ministerial approval). The CSA is also making changes to Companion Policy 45-106, Prospectus Exemption (45-106 CP). Currently, in all CSA jurisdictions except British Columbia, Form 45-106F1 Report of Exempt Distribution (Form 45-106F1, the Current Report) is in use. In British Columbia, Form 45-06F6 British Columbia Report of Exempt Distribution (Form 45-106F6, and together with Form 45-106F1, the Current Reports) is in use. As of June 30th, 2016, the amendments replace the Current Reports with the New Report. The New Reports must be used for distributions that occur on or after June 30, 2016 with some exceptions. **Key Features:** The New Report will apply in all CSA jurisdictions to both investment fund issuers and non-investment fund issuers that distribute securities under certain prospectus exemptions. The New Report introduces new information requirements in most of the CSA jurisdictions, including disclosure of the following: • additional details about the issuer including its size and primary business activity; • identities of the directors, executive officers, and promoters of certain issuers; • identities of control persons of certain issuers in a non-public schedule; • additional details about the securities distributed and, for certain jurisdictions, details about the documents provided in connection with the distribution; • specific details about the prospectus exemptions relied on, both on an aggregate and per investor basis, and; • details about compensation paid to registrants, connected persons, insiders and employees of the issuer or the investment fund manager involved in the distribution. For investment fund issuers, the New Report also requires disclosure regarding the size of the fund, the general type of the fund and net proceeds to the fund for the period for which the report is filed. The New Report also provides carve-outs from certain information requirements for: • investment fund issuers; • reporting issuers and their wholly owned subsidiaries; • foreign public issuers and their wholly owned subsidiaries, and • issuers distributing eligible foreign securities only to permitted clients. In addition, an issuer is not required to provide certain information in the New Report if the information can be gathered through the issuer’s continuous disclosure filings, the issuer’s profile on the System for Electronic Document Analysis and Retrieval (SEDAR), or a registrant firm’s profile on the National Registration Database (NRD). For more information on the New Reports, 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. **Categories:** News & Updates --- ### [SEC Adopts Crowdfunding, May 16, 2016](https://baxsecuritieslaw.com/2016516sec-adopts-crowdfunding-may-16-2016/) **Published:** May 17, 2016 **Author:** Barbara Hendrickson **Excerpt:** New Securities and Exchange Commission (SEC) rules went into effect May 16, 2016 allowing companies to sell and offer securities through crowdfunding. These rules and amendments are designed to help start-up and early stage companies raise capital while providing investors with additional protection.The final rules... **Content:** New Securities and Exchange Commission (SEC) rules went into effect May 16, 2016 allowing companies to sell and offer securities through crowdfunding. These rules and amendments are designed to help start-up and early stage companies raise capital while providing investors with additional protection. The final rules recognize crowdfunding as an evolving method of raising capital and permit individuals to invest in securities-based crowdfunding transactions subject to certain limits: • Issuers are capped at $1 million for the amount of capital they may raise through crowdfunding in any 12-month period. • If the investor’s annual income or net worth is less than $100,000, the maximum that can be invested is the greater of $2,000 or 5% of the lesser of the investor’s annual income or net worth. • If the investor’s annual income and net worth are equal to, or greater than $100,000, the maximum that can be invested is 10% of the investor’s annual income, but not to exceed $100,000. Calculating net worth involves adding up all of an investor’s assets and subtracting all liabilities. The resulting sum is the investor’s net worth. The value of a primary residence is not included in the net worth calculation. Correspondingly any mortgage or loan against a primary residence is not included in a liability unless the loan amount is over the fair market value of the house then it would count as a liability. Any increases in a loan amount within 60 days of the purchase will count as a liability as well. Investors can only invest in a crowdfunding offering through a broker dealer or funding portal both of which must be registered with the SEC and be a member of the Financial Industry Regulatory Authority. Companies cannot offer crowdfunding offerings directly. Broker dealers and funding portals that operate crowdfunding portals are required to offer disclosure to investors. These materials include, among other things, information about directors and officers, description of the business, use of proceeds, maximum offerings, deadline for the offering, details of related party transactions and risks. The new rules also provide for tiered financial disclosure to investors which depends on the amount of money raised by the company in the prior 12 months: • If the issuer raised $100,000 or less the issuer must disclose financial statements and specific line items from their income tax returns as certified by an officer of the company. • If the amount raised is between $100,000 and $500,000 the financial statements must be reviewed by an independent public accountant who must produce a review report. • If the amount is between $500,000 – $1 million and it is first time crowdfunding, then an accountants review report – otherwise the financial statements must be audited. Funding portals and broker dealers are required to provide online forums for investors to discuss investment opportunities. Investors have 48 hours to change their mind and cancel their investment. If the company makes a material change to the offering terms, then the investor must be given 5 business days to reconfirm their investment. For more information, please see SEC Investor Bulletin: Crowdfunding for Investors [https://www.sec.gov/oiea/investor-alerts-bulletins/ib\_crowdfunding-.html](https://www.sec.gov/oiea/investor-alerts-bulletins/ib_crowdfunding-.html). For information on crowdfunding in Canada 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. **Categories:** News & Updates --- ### [New Prospectus Exemption for Distributions through an Investment Dealer, January 14, 2016](https://baxsecuritieslaw.com/2016517new-prospectus-exemption-for-distributions-through-an-investment-dealer-january-14-2016/) **Published:** May 18, 2016 **Author:** Barbara Hendrickson **Excerpt:** The securities regulatory authorities in BC, Alberta, Saskatchewan, Manitoba, and New Brunswick (the participating jurisdictions) have each adopted a prospectus exemption that subject to certain conditions, lets issuers who are listed on a Canadian exchange raise money by selling securities to investors who have been... **Content:** The securities regulatory authorities in BC, Alberta, Saskatchewan, Manitoba, and New Brunswick (the participating jurisdictions) have each adopted a prospectus exemption that subject to certain conditions, lets issuers who are listed on a Canadian exchange raise money by selling securities to investors who have been advised on the suitability of the investment by an IIROC dealer. The purpose of the exemption, as detailed in Multilateral CSA Notice 45-318, Prospectus Exemption for Certain Distributions Through an Investment Dealer, is to make capital raising easier for listed issuers and to encourage retail investors to invest in private placements, while maintaining appropriate investor protection. The exemption was adopted concurrently by the participating jurisdictions on January 14th, 2016. **Under the exemption:** - the issuer must be a reporting issuer in at least one jurisdiction of Canada and have a class of equity securities listed on the Toronto Stock Exchange, the TSX Venture Exchange, the Canadian Securities Exchange, or the Aequitas Neo Exchange Inc.; - the issuer must have filed all timely and periodic disclosure documents as required under the continuous disclosure requirements in our securities legislation; - the offering can consist only of a listed security, a unit consisting of a listed security and a warrant to acquire another listed security, or another security convertible into a listed security at the security holder’s sole discretion; - the news release announcing the offering must: - dsclose, in reasonable detail, the distribution, including use of proceeds, and any material fact not yet generally disclosed, and - include a statement that there is no material fact or material change about the issuer that has not been generally disclosed; - the investor must obtain advice regarding the suitability of the investment from an investment dealer; - in British Columbia, Saskatchewan, Manitoba and New Brunswick, the investor must be provided with a contractual right of action in the event of a misrepresentation in the issuer’s continuous disclosure record regardless of whether the investor relied on the misrepresentation. In Alberta, purchasers are afforded a statutory right of action under Part 17.01 of the Securities Act (Alberta); and, - although an offering document is not required, if an issuer voluntarily provides one, an investor will have certain rights of action in the event of a misrepresentation in it. Issuers will have to file a report of exempt distribution within 10 days after each distribution under the exemption. 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. **Categories:** News & Updates --- ### [TODAY'S NEW AND DEVELOPING CARBON MARKETS - Barbara Hendrickson’s speaking notes June 3, 2016](https://baxsecuritieslaw.com/2016613todays-new-and-developing-carbon-markets-barbara-hendricksons-speaking-notes-june-3-2016/) **Published:** June 13, 2016 **Author:** Barbara Hendrickson **Excerpt:** “Around the globe, initiatives to price carbon, including cap-and-trade systems, are proliferating at a rapid pace. The shifting evolution of carbon markets, including potential new markets, market mechanisms, and market participants is occurring at an almost dizzying rate, including across Canada.”The Environmental Finance Advisory Committee... **Content:** “Around the globe, initiatives to price carbon, including cap-and-trade systems, are proliferating at a rapid pace. The shifting evolution of carbon markets, including potential new markets, market mechanisms, and market participants is occurring at an almost dizzying rate, including across Canada.” The Environmental Finance Advisory Committee (“EFAC”) of the University of Toronto held an all day session on Friday June 3rd, 2016 on new developments in the carbon markets. Barbara Hendrickson spoke at the session and the following is a summary of her speaking notes: **CARBON TRADING REGULATION in CANADA: THE BASICS** I wanted to say a few words to you about the application of the Ontario securities and commodities regimes to trading the allowances and offsets created under the Ontario Climate Change Mitigation and Low Carbon Economy Act (“Act”). Before I do that I should note that the Ontario provincial government has included in the new cap and trade legislation several provisions that mirror aspects of securities regulation and which will apply to all trades in credits and emission allowances under the Act. I am not going to cover those here as they will be reviewed later this afternoon. A discussion of those provisions is also included in the comment letter that EFAC submitted to the Ontario government during the consultations on Bill 172. A copy of this letter can be found on the EFAC website. In addition, I would also like to note that my comments here are limited to Ontario securities and commodities laws. Please keep in mind that trades in Ontario offsets and allowances may be subject to the securities laws of other provinces. As you are likely aware, we have 13 regulators in the securities / commodities area in Canada. While, securities and commodities rules across Canada are similar, there are some important differences. As you are likely aware carbon based products such as offset credits and allowances are traded in at least three ways: • through accounts; • through exchanges; • over the counter or OTC. In Ontario the Ontario Securities Commission (“OSC”) regulates the trading of securities and commodities through the Ontario Securities Act (“OSA”) and the Commodity Futures Act (“CFA”). There are at least three ways that a trade in Ontario involving an offset credit or allowance could be caught by the OSA and or the CFA. • Trading through Government Accounts – This is the trading of allowances and offset credits through accounts set up under the Act to evidence the ownership of those credits and allowances. These trades will not likely be subject to securities and commodities legislation in Ontario unless these products are considered to be “securities” under the OSA. • Trading through Exchanges – The trading of carbon based futures contracts and options on future contracts on an exchange will be regulated in Ontario under the Commodity Futures Act. • Trading OTC or over the counter (not on an exchange) – OTC trading of carbon based forward contracts will likely be considered to be a “derivative” under Ontario securities laws and will be subject to certain securities requirements. An OTC forward trade may also in some circumstances may also be considered to be a “security” under the OSA and therefore subject to securities regulation. Commodity Futures Act The CFA covers exchange traded commodity futures contracts and options on commodity futures contracts which are carbon based. The OSC in 2004 passed OSC Rule 14-502 which recognizes that “a product based on environmental quality including emissions or emission credits” could be a commodity. Currently there are no exchanges for carbon products in Ontario. Derivatives Certain OTC forward trading relating to allowances and offset credits may be considered to be derivatives for the purposes of Ontario securities laws. The definition of derivatives includes a “commodity contract” and the OSC has recognized that “commodities” include certain intangible commodities such as “carbon credits and emission allowances.” I just want to emphasize that definition of “derivatives” catches trades in carbon based products sold on a forward basis and not on a spot basis. The definition of derivatives expressly excludes a contract where it is intended by the parties that the commodity is to be “delivered” and does not allow for cash settlement in place of delivery. Generally, “delivery” for a carbon product such as an allowance or offset credit is considered to be effected when the allowance or credit is transferred in an account or registry. Therefore, trading carbon between accounts would not likely be caught by the definition of derivative (although it still could be a “security” under the OSA in some circumstances.) There are a number of areas of regulation of derivatives under the OSA including: • fraud, • market manipulation, • marketing, and • insider trading and tipping. Importantly in Ontario “derivatives” are covered by the prospectus rule. The prospectus rule specifies that you cannot trade in a security or derivative unless: • you file and receive a receipt for a prospectus, or • you trade under an exemption from the prospectus requirements such as the accredited investor exemption or the minimum investment exemption ($150,000). Currently in Ontario, the advisor and dealer registration requirements do not apply to derivatives. However, Ontario intends to introduce legislation that would make trades in derivatives subject to the dealer registration and advisor registration requirements. In addition to certain provisions of the OSA, there are a number of new rules that either have been and will be passed to regulate trading in derivatives to avoid a reoccurrence of the 2008 meltdown. These include rules respecting the regulating the derivatives industry: • reporting trades in derivatives; • trade repositories, • clearing and • counterparty collateral and positions. Security In some circumstances a trade in a carbon based product such as an offset credit or an allowance could be considered to be a “security” and therefore subject to the full impact of the Ontario Securities Act. This is where the product falls under the definition of a “security” in the OSA which includes • an investment contract; • a document evidencing an option in or to a security; • a document, instrument or writing commonly known as a security. To be clear the trading allowances and offsets through government mandated accounts will not likely be subject to securities legislation as “derivatives” as it is generally considered that the transferring of allowances and credits in these government mandated registries is the equivalent of physical delivery and therefore a spot trade. However, trading in allowances and credits whether on a spot or forward basis may be subject to securities regulation if the Ontario Securities Commission deems that it is in the public interest to do so. **Categories:** News & Updates --- ### [Registration Reform – the CSA publishes the proposals for a “Best Interests” Standard, April 28, 2016](https://baxsecuritieslaw.com/2016614registration-reform-the-csa-publishes-the-proposals-for-a-best-interests-standard-april-28-2016/) **Published:** June 14, 2016 **Author:** Barbara Hendrickson **Excerpt:** Canadian Securities LawsRegistration Reform – the CSA publishes the proposals for a “Best Interests” Standard, April 28, 2016On April 28, 2016, the Canadian Securities Regulators (CSA) published CSA Consultation Paper 33-404 Proposals to Enhance the Obligations of Advisers, Dealers and Representatives Toward Their Clients (“CSA... **Content:** **Canadian Securities Laws** **Registration Reform – the CSA publishes the proposals for a “Best Interests” Standard, April 28, 2016** On April 28, 2016, the Canadian Securities Regulators (CSA) published CSA Consultation Paper *33-404 Proposals to Enhance the Obligations of Advisers, Dealers and Representatives Toward Their Clients* (“**CSA 33-404**”) for a comment period ending August 26, 2016. CSA 33-404 includes reforms to National Instrument 31-103, *Registration Requirements, Exemptions and Ongoing Registrant Obligations* (“**NI 31-103**”) which are designed to *“*better align the interests of registrants to the interests of their clients, better define the client-registrant relationship for clients and enhance various specific obligations that registrants owe to their clients.” The proposed changes to NI 31-103 include expanded obligations with respect to conflict of interests, know your client, know your product, suitability, relationship disclosure, enhanced proficiency requirements, titles of representatives, use of designations, clarification of UDP and CCO roles and the introduction of a statutory fiduciary obligation for advisors with discretionary authority. In addition, CSA 33-404 includes a proposed regulatory “best interest” standard, accompanied by guidance that would “form an over-arching standard and governing principle against which all other client obligations would be interpreted.” The proposed “best interest” standard would require that a registered dealer or registered adviser or their representatives “deal fairly, honestly and in good faith” with clients and act in their clients’ “best interests”. The standard of care would be that of “a prudent and unbiased firm or representative, acting reasonably”. In complying with the standard of care, registrants would be guided by the following principles: - Act in the best interests of the client, - Avoid or control conflicts of interest in a manner that prioritizes the client’s best interests, - Provide full, clear, meaningful and timely disclosure, - Interpret law and agreements with clients in a manner favourable to the client’s interest where reasonably conflicting interpretations arise, - Act with care All of the CSA jurisdictions are consulting on the regulatory best standard, except for the British Columbia Securities Commission (BCSC) which is only consulting on the proposed changes to NI 31-103. The BCSC has declined to consult on the best interest standard as in its view it “may not be workable” and it is “vague and unclear and will create uncertainty for registrants.” The remaining members of the CSA, with the exception of the Ontario and New Brunswick share some of the BCSC’s reservations on the benefits of the “best interest standard” but are interested in receiving and reviewing the comments. Both the proposed targeted reforms of NI 31-103 and the best interest standard would apply to all advisers, dealers and representatives, including IIROC and MFDA members. 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 Securities Law 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. **Categories:** News & Updates --- ### [Proposed CSA Proxy Voting Protocols, May 29, 2016](https://baxsecuritieslaw.com/2016614vtfksgwcjqapl9862takl6rpiz9zmg/) **Published:** June 14, 2016 **Author:** Barbara Hendrickson **Excerpt:** Canadian Securities Laws Proposed CSA Proxy Voting Protocols, May 29, 2016On March 31, 2016, the Canadian Securities Administrators (CSA) published for comment CSA Multilateral Staff Notice 54-304 Final Report on Review of the Proxy Voting Infrastructure and Request for Comments on Proposed Meeting VoteReconciliation Protocols... **Content:** **Canadian Securities Laws** **Proposed CSA Proxy Voting Protocols, May 29, 2016** On March 31, 2016, the Canadian Securities Administrators (CSA) published for comment 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* (CSA 54-304). CSA 54-304 proposes voluntary protocols containing CSA staff expectations and guidance for improving the processes involved in the tabulation of proxy votes. The comment period closes on July 15, 2016. **Background:** The CSA has deemed shareholder voting as one of the most important means by which shareholders can affect an issuer’s governance and fundamental to the quality and integrity of the capital markets. Because most shares in Canada are voted through proxy voting, the CSA is committed to “increasing the accuracy, the accountability, and the reliability of the proxy voting infrastructure.” For some time, issuers and investors have expressed concerns that the proxy voting infrastructure and meeting vote reconciliation are inaccurate, unreliable and non-transparent. They pointed to two specific problems as evidence: - Over-voting: Over-voting occurs when an intermediary submits proxy votes and the meeting tabulator cannot establish that the intermediary has any vote entitlements or the number of proxy votes submitted exceeds the number of vote entitlements for that intermediary as calculated by the tabulator. - Missing votes: Beneficial owners generally have no way of knowing whether a tabulator or meeting chair accepted their intermediary’s proxy votes. Investors have identified instances where the voting results suggested their proxy votes were not included in the tabulation and therefore went “missing.” Following extensive research and consultation, including reviews of shareholder meetings, CSA staff identified two significant information and communication gaps in the processes used to tabulate proxy votes submitted by intermediaries on behalf of their beneficial owner clients (known as meeting vote reconciliation): - Information gaps: Meeting tabulators do not always have the accurate and complete vote entitlement information they require to properly establish which intermediaries have vote entitlements for a meeting and how many vote entitlements these intermediaries have. Missing, incomplete or inaccurate vote entitlement information can cause an intermediary that submits proxy votes to be in an over-vote position from the meeting tabulator’s perspective. Meeting tabulators use different methods to address over-vote situations. Depending on the tabulator, the same proxy votes could be accepted, rejected or pro-rated. Rejected or pro-rated votes could result in the appearance of missing votes. - Communication gaps: There are no standard communication channels between intermediaries and tabulators. The lack of such communication channels means there is no way to efficiently and accurately: - confirm that all necessary information has been sent and received, or; - detect and resolve information problems that could lead to proxy votes being rejected or pro-rated at a meeting. Furthermore, intermediaries are not routinely notified if a meeting tabulator rejects or pro-rates their proxy votes due to missing or incomplete vote entitlement information. In response, CSA staff developed the proposed protocols to address these gaps. The protocols outline roles and responsibilities and provide detailed guidance on operational processes for the key entities in the proxy voting process including intermediaries, tabulators and Broadridge Fiancial Solutions as well as issuers, that implement meeting vote reconciliation. For more details please see CSA 54-304. http://www.osc.gov.on.ca/en/SecuritiesLaw\_csa\_20160331\_54-304\_proxy-voting-infrastructure.htm The CSA’s goal is to finalize and publish the protocols in time for the 2017 proxy season. 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 Securities Law 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. **Categories:** News & Updates --- ### [Barbara Hendrickson - On The Record with Mick Hassell [Audio Interview]](https://baxsecuritieslaw.com/2016629barbara-hendrickson-on-the-record-with-mick-hassell-audio-interview/) **Published:** June 29, 2016 **Author:** Barbara Hendrickson **Excerpt:** Episode D: The Toronto Business Lawyers Association, Interview with Barbara HendricksonBarbara is is the CEO and Founder of BAX Securities Law and discusses an organization that promotes referrals between lawyers at small firms.Visit the Hassell Tribal Counsel podcast site **Content:** Episode D: The Toronto Business Lawyers Association, Interview with Barbara Hendrickson Barbara is is the CEO and Founder of BAX Securities Law and discusses an organization that promotes referrals between lawyers at small firms. [Visit the Hassell Tribal Counsel podcast site](http://trialcounsel.ca/business-of-law-podcast/) **Categories:** News & Updates --- ### [[Link] Financial Post - "Mitch Kowalski: Why small is beautiful for exchanging ideas, tips and experiences"](https://baxsecuritieslaw.com/2016629link-financial-post-mitch-kowalski-why-small-is-beautiful-for-exchanging-ideas-tips-and-experiences/) **Published:** June 25, 2016 **Author:** Barbara Hendrickson **Excerpt:** http://business.financialpost.com/legal-post/mitch-kowalski-why-small-is-beautiful-for-exchanging-ideas-tips-and-experiences **Content:** **Categories:** News & Updates --- ### [Canadian Bar Association submissions on the Capital Markets Stability Act July 6, 2016](https://baxsecuritieslaw.com/2016711canadian-bar-association-submissions-on-the-capital-markets-stability-act-july-6-2016/) **Published:** July 11, 2016 **Author:** Barbara Hendrickson **Excerpt:** The Securities Committee of the Canadian Bar Association, of which Barbara Hendrickson is the co-chair, filed their comments on the latest version of the Capital Markets Stability Act.Read more here: PDF **Content:** The Securities Committee of the Canadian Bar Association, of which Barbara Hendrickson is the co-chair, filed their comments on the latest version of the Capital Markets Stability Act. [Read more here: PDF](/s/16-35-engCMSA-July-2016-CBA.pdf) **Categories:** News & Updates --- ### [Ontario Securities Commission Issues Request for Comment on Proposed Changes for Distributions Outside of Canada](https://baxsecuritieslaw.com/201688ontario-securities-commission-issues-request-for-comment-on-proposed-changes-for-distributions-outside-of-canada/) **Published:** August 8, 2016 **Author:** Barbara Hendrickson **Excerpt:** July 23, 2016Ontario Securities Commission Issues Request for Comment on Proposed Changes for Distributions Outside of CanadaOn June 30th, 2016, the Ontario Securities Commission (OSC) issued proposed OSC Rule 72-503 – Distributions Outside of Canada and Proposed Companion Policy 72-503CP, Distributions Outside of Canada (“Proposed... **Content:** **July 23, 2016** **Ontario Securities Commission Issues Request for Comment on Proposed Changes for Distributions Outside of Canada** On June 30th, 2016, the Ontario Securities Commission (OSC) issued proposed *OSC Rule 72-503 – Distributions Outside of Canada* and *Proposed Companion Policy 72-503CP, Distributions Outside of Canada* (“Proposed Rule”). The Proposed Rule replaces Interpretation Note 1 (the Interpretation Note), issued in 1983. The purpose of the Proposed Rule is to provide certainty to participants in cross-border transactions by providing prospectus and dealer registration exemptions, in connection with a distribution of securities to investors outside of Canada. The Proposed Rule only provides prospectus and dealer registration exemptions and is not otherwise determinative of whether Ontario securities law would otherwise apply to a distribution outside of Canada or to activities related to the distribution. Generally, the Proposed Rule provides exemptions from the prospectus requirement in respect of a distribution of securities to a person or company outside of Canada in the following circumstances: - if the distribution is under a public offering document in the US or a designated foreign jurisdiction; - if a concurrent distribution is qualified under a final prospectus in Ontario; - if the issuer is and has been a reporting issuer in a jurisdiction of Canada for the four months immediately preceding the distribution, and; - all other distributions, but subject to restrictions on resale to a person or company in a jurisdiction of Canada. The Proposed Rule also provides an exemption from the dealer and underwriter registration requirement in respect of a distribution of securities to a person or company outside of Canada on the following conditions: - the head office or principal place of business of the person or company is in the US, a designated foreign jurisdiction or Canada; - in the case of a distribution to a purchaser in the US, the person or company is appropriately registered with the SEC and FINRA and complies with all applicable regulatory requirements; - in the case of a distribution to a purchaser located in a designated foreign jurisdiction, the person or company is registered in a category similar to a dealer in that jurisdiction and complies with all applicable regulatory requirements; - subject to a limited exception, the person or company does not carry on business as a dealer or underwriter from an office or place of business in Ontario; - other than the issuer or selling security holder, the person or company does not trade securities to, with or on behalf of anyone in Ontario, and; - the person or company relying on the exemption is not registered as a dealer in any jurisdiction of Canada. Issuers will be required to file the Proposed Form electronically in Ontario, pursuant to [OSC Rule 11-501 Electronic Delivery of Documents](http://www.osc.gov.on.ca/en/SecuritiesLaw_11-501.htm) to the Ontario Securities Commission. Proposed OSC Rule 72-503 is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20160630_72-503_rfc_distributions-outside-canada.htm) from Ontario Securities Commission’s website. 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. **Categories:** News & Updates --- ### [Ontario Securities Commission Introduces OSC Policy 15-601, The Whistleblower Program](https://baxsecuritieslaw.com/2016817ontario-securities-commission-introduces-osc-policy-15-601-the-whistleblower-program/) **Published:** August 17, 2016 **Author:** Barbara Hendrickson **Excerpt:** On July 14th, 2016, the Ontario Securities Commission (“OSC”) introduced OSC Policy 15-601, the Whistleblower Program (“Program”) which is designed to encourage individuals to report information on serious securities or derivatives related misconduct to the OSC, or where appropriate in the circumstances, through an internal... **Content:** On July 14th, 2016, the Ontario Securities Commission (“OSC”) introduced OSC Policy 15-601, the Whistleblower Program (“Program”) which is designed to encourage individuals to report information on serious securities or derivatives related misconduct to the OSC, or where appropriate in the circumstances, through an internal compliance and reporting mechanism. Under the Program, individuals who meet certain eligibility criteria and who voluntarily submit information to OSC staff regarding a breach of Ontario securities laws may be eligible for a monetary reward of up to $5 million if it is determined that the information submitted was of meaningful assistance to the OSC staff in investigating the matter and in obtaining a decision of the OSC that results in an order imposing monetary sanctions and/ or making of a voluntary payment of $1 million or more. Whistleblowers are required to file a declaration stating among other things that they understand that it is an offence to make a statement to the OSC that is misleading or untrue or does not state a fact that is required to be stated to make the statement not misleading. The whistleblower may be prosecuted for providing misleading or untrue information to the OSC. The form may be submitted online or sent by mail. In certain circumstances, the whistleblower may submit the information anonymously if the whistleblower is represented by a lawyer. In this instance, the lawyer will complete whistleblower submission form and will sign the declaration on behalf of the whistleblower. However, before any monetary award can be made, the whistleblower will be generally be required to reveal their name. In addition, the OSC cannot guarantee anonymity if there is a request made under the Freedom of Information and Personal Protection and privacy act (Ontario). The policy states that the OSC expects that employers will not retaliate against the whistleblower; however, the OSC does not currently have the statutory ability to enforce these provisions of the policy. In order to qualify for an award, the information submitted must be original, gathered from the whistleblower’s independent knowledge derived from his or her experiences, communications and observations or the whistleblower’s critical analysis of publicly available information. The following types of information are excluded from the accepted information: - Subject to solicitor-client privilege; - Obtained in connection with the provision of legal advice to a client or employer on whose behalf the whistleblower or his /her firm acts or provides services; - Obtained from an allegation made in a judicial administrative hearing or enforcement matter of a securities-related self-regulatory organization, a government report, hearing; and, audit or investigation or news media (unless the whistleblower is the only source) or a violation of applicable criminal law. Even after the whistleblower has made the original submission, the Policy allows the OSC to request additional information and assistance from the whistleblower, including: - Guidance and explanations, so that the OSC may evaluate and use the information provided; - A description and precise location of, any documents that support the whistleblower’s submission that the whistleblower has knowledge of, but not possession; - Any additional information in the whistleblower’s possession; - Testimony at any OSC proceedings; and, - Information relating to whether the whistleblower is entitled to a whistleblower award. In general, the information submitted will only be eligible if it relates to a serious violation of Ontario securities laws. It should be of a high quality and provide meaningful assistance to the OSC in investigating the matter and relating to the outcome. Additionally, the information must relate to a violation that is not currently being investigated or which significantly broadens the scope of an existing investigation. Whistleblowers are required to maintain as confidential any information provided to them by a Commission staff member and any information they may have become aware of during their course of their participation in the investigation. OSC Policy 15-601 is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_20160714_15-601_policy-whistleblower-program.htm) from the Ontario Securities Commission’s website. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson quoted in Law Times on the timing of the new Canadian Capital Markets Regulator](https://baxsecuritieslaw.com/201691barbara-hendrickson-quoted-in-law-times-on-the-timing-of-the-new-canadian-capital-markets-regulator/) **Published:** September 1, 2016 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson quoted in Law Times on the timing of the new Canadian Capital Markets RegulatorRead more: http://www.lawtimesnews.com/201608085561/focus-on/focus-governments-move-on-co-operative-securities-regulator **Content:** Barbara Hendrickson quoted in Law Times on the timing of the new Canadian Capital Markets Regulator Read more: **Categories:** News & Updates --- ### [September 27, 2016 Barbara Hendrickson Appointed to the editorial board of the Canadian Institute’s Securities Law & Litigation Review.](https://baxsecuritieslaw.com/20161029september-27-2016-barbara-hendrickson-appointed-to-the-editorial-board-of-the-canadian-institutes-securities-law-litigation-review/) **Published:** September 29, 2016 **Author:** Barbara Hendrickson **Excerpt:** Barbara joins a senior editorial board of securities lawyers of the Canadian Institute's Securities Law & Litigation Review from a number of national and international law firms recognized as experts in the securities area. The CI Review which is published quarterly is designed to cover... **Content:** Barbara joins a senior editorial board of securities lawyers of the Canadian Institute’s Securities Law & Litigation Review from a number of national and international law firms recognized as experts in the securities area. The CI Review which is published quarterly is designed to cover key developments and trends in a variety of practice areas, legislation, practice and procedure – providing securities lawyers with access to up-to-date information that is critical to their practice. **Categories:** News & Updates --- ### [OSC Warns after Penalizing Mortgage Investment Entities for Unregistered Securities Trading, February 19, 2016](https://baxsecuritieslaw.com/2016529osc-warns-after-penalizing-mortgage-investment-entities-for-unregistered-securities-trading-february-19-2016/) **Published:** May 30, 2016 **Author:** Barbara Hendrickson **Excerpt:** In the wake of announcing enforcement settlement agreements with mortgage investment entities (MIEs), mortgage brokers, administrators, and their principals involved in trading securities without registration contrary to the Securities Act (Ontario), the Ontario Securities Commission (OSC) issued a stern reminder for MIEs.The OSC took the... **Content:** In the wake of announcing enforcement settlement agreements with mortgage investment entities (MIEs), mortgage brokers, administrators, and their principals involved in trading securities without registration contrary to the Securities Act (Ontario), the Ontario Securities Commission (OSC) issued a stern reminder for MIEs. The OSC took the extra step to remind those businesses engaged in trading in securities such as units or common shares of a MIE that they may require registration with the OSC, as well as with Financial Services Commission of Ontario. In the notice the OSC encouraged those entities to review registration requirements and obtain legal advice if necessary. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson has Achieved a BV Distinguished™ Peer Review Rating™ from Martindale-Hubbell®.](https://baxsecuritieslaw.com/20161012barbara-hendrickson-has-achieved-a-bv-distinguished-peer-review-rating-from-martindale-hubbell/) **Published:** October 13, 2016 **Author:** Barbara Hendrickson **Excerpt:** Toronto, ON October 11, 2016 - Martindale-Hubbell® has confirmed that Barbara Hendrickson, Securities Partner, BAX Securities Law has again been granted the BV Distinguished Peer Review Rating™ from Martindale-Hubbell. Barbara first achieved this rating in 2007.For more than 140 years, The Martindale-Hubbell®Peer Review Ratings™ are an... **Content:** Toronto, ON October 11, 2016 – Martindale-Hubbell® has confirmed that Barbara Hendrickson, Securities Partner, BAX Securities Law has again been granted the BV Distinguished Peer Review Rating™ from Martindale-Hubbell. Barbara first achieved this rating in 2007. For more than 140 years, The Martindale-Hubbell®Peer Review Ratings™ are an objective indicator of a lawyer’s high ethical standards and professional ability, generated from evaluations of lawyers and the judiciary in the United States and Canada. It is achieved only after an lawyer has been reviewed and recommended by their peers – members of the bar and the judiciary. Congratulations go to Barbara Hendrickson who has achieved the Martindale-Hubbell Peer Review Rating™. She commented, “The Martindale-Hubbell BV Distinguished Rating is a credential highly valued and sought after in the legal world. I am thankful to my peers who nominated me for this distinction, and proud to have earned this rating.” **Categories:** News & Updates --- ### [The OSC “Launches” Launchpad for FinTech Companies October 27, 2016](https://baxsecuritieslaw.com/20161031the-osc-launches-launchpad-for-fintech-companies-october-27-2016/) **Published:** October 31, 2016 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (“OSC”) has announced the introduction of Launchpad which is a hub to work directly with fintech companies to help them navigate the securities regulatory framework. http://www.osc.gov.on.ca/en/what-you-need-to-know.htmThe OSC has identified a broad range of activities that may give rise securities regulatory compliance... **Content:** The Ontario Securities Commission (“OSC”) has announced the introduction of Launchpad which is a hub to work directly with fintech companies to help them navigate the securities regulatory framework. The OSC has identified a broad range of activities that may give rise securities regulatory compliance issues including: · Connecting investors with companies looking to raise capital through an online platform, website, or app. · Setting up lending platforms that allow investors to fund loans or portions of loans. · On line platforms recommending investments. · Online advising, including operating platforms that recommend model portfolios or other investments (“robo-advising”). · Setting up online platforms (including equity crowdfunding portals), auction boards, bulletin boards, apps, or similar facilities for securities trading. · Operating angel investor organizations or networks, or acting as a lead investor. · Using artificial intelligence to recommend investments or facilitate trading. · Arranging or participating in pitch sessions, where companies present their businesses, products, services, or applications to potential investors. · Setting up means for investors and companies looking to raise capital to interact, including chat rooms, message boards, and other forms of social media. · Helping to prepare offering documents, marketing materials, or other similar documents for companies looking to raise capital. Barbara Hendrickson has extensive experience providing corporate finance, securities and financial services advice to the fintech industry. Her clients have operated in the following areas: online marketplace lending including peer to peer lending and real estate based lending, equity crowdfunding, trading signal providers, robo-advisors, online mortgage syndication, financial services software providers, artificial intelligence and robotics providers, online commodity traders, foreign exchange, regulatory compliance software, exempt market dealers with online trading systems, mobile apps and trading and clearing and settlement system. If you would like more information, please call Barbara Hendrickson at 416.601.1004. **Categories:** News & Updates --- ### [Barbara Hendrickson: Guest Speaker - Manitoba Bar Association Luncheon - "Navigating the securities regime for Fintech companies”](https://baxsecuritieslaw.com/mba-luncheon-dec1-2016/) **Published:** December 19, 2016 **Author:** Barbara Hendrickson **Excerpt:** Barbara was a guest speaker at a meeting of the Securities Committee of the Manitoba Bar Association on Fintech developments in Canada, with an emphasis on peer to peer lending as a case study. Barbara Hendrickson has extensive experience providing corporate finance, securities and financial... **Content:** Barbara was a guest speaker at a meeting of the Securities Committee of the Manitoba Bar Association on Fintech developments in Canada, with an emphasis on peer to peer lending as a case study. Barbara Hendrickson has extensive experience providing corporate finance, securities and financial services advice to the Fintech industry. Her clients have operated in the following areas: online marketplace lending including peer to peer lending and real estate based lending, equity crowdfunding, trading signal providers, robo advisors, online mortgage syndication, financial services software providers, artificial intelligence and robotics providers, online commodity traders, foreign exchange, regulatory compliance software, mobile apps and trading and clearing and settlement system. The complete presentation can be [downloaded here](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2016/12/Manitoba-Bar-Association_BHendrickson_Luncheon.pdf). If you would like more information, please call Barbara Hendrickson at 416.601.1004. **Categories:** News & Updates --- ### [Barbara Hendrickson quoted in Law Times article “Taking the Business Plunge” November 28, 2016](https://baxsecuritieslaw.com/taking_the_plunge/) **Published:** December 30, 2016 **Author:** Barbara Hendrickson **Excerpt:** “It’s a bit of a myth that you can’t practice securities law at a smaller firm.” Read full article here... **Content:** ### “It’s a bit of a myth that you can’t practice securities law at a smaller firm.” [ ***Read full article here…***](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2016/12/BarbaraHendrickson_Nov28_16.pdf) **Categories:** News & Updates --- ### [Raising Capital in Canada – Crowdfunding Update January 12, 2017](https://baxsecuritieslaw.com/raising-capital-canada-crowdfunding-update/) **Published:** January 12, 2017 **Author:** Barbara Hendrickson **Excerpt:** Canadian securities law has recently embraced the concept of crowdfunding. Canadian securities rules now allow companies or “issuers” to raise small amounts of capital through online portals with a minimum of disclosure.  Investors do not have to be “accredited investors” to take participate in these capital... **Content:** Canadian securities law has recently embraced the concept of crowdfunding. Canadian securities rules now allow companies or “issuers” to raise small amounts of capital through online portals with a minimum of disclosure. Investors do not have to be “accredited investors” to take participate in these capital raises. The US Securities and Exchange Commission (“**SEC**”) has also recently introduced a crowdfunding option in the United States. Crowdfunding gives start-ups and small businesses a new way of raising money. The securities rules on how companies / issuers can “crowdfund” vary across Canada: - British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia announced their crowdfunding exemption in CSA Notice 45-316 “Start-up Crowdfunding Registration and Prospectus Exemptions” on May 14, 2015 (as amended by CSA Notice 45-317 and CSA Notice 45-319) (“**Start-up Exemption**”). - Manitoba, Ontario, Québec, New Brunswick and Nova Scotia’s crowdfunding exemption was effective January 25, 2016 – Multilateral Instrument 45-108 Crowdfunding (“**MI 45-108 Exemption**”) with Alberta joining on October 16, 2016. - Alberta adopted its own crowdfunding exemption on July 19, 2016 – Alberta Securities Commission Rule 45-517 Prospectus Exemption for Start-up Businesses (“**ASC Rule 45-517 Exemption**”). - Prince Edward Island, Newfoundland and Labrador and the Canadian territories do not have a crowdfunding prospectus or registration exemption. - Manitoba, Quebec, New Brunswick, Nova Scotia have both the Start-up Exemption and the MI 45-108 Exemption. - Alberta has both the MI 45-108 Exemption and the ASC Rule 45-517 Exemption. - New SEC rules in the United States came into effect May 16, 2016 which allow companies to sell and offer securities through crowdfunding portals. These rules and amendments are designed to help start-up and early stage companies raise capital while providing investors with additional protection. For more information, please see SEC Investor Bulletin: Crowdfunding for Investors **[https://www.sec.gov/oiea/investor-alerts-bulletins/ib\_crowdfunding-.html](https://www.sec.gov/oiea/investor-alerts-bulletins/ib_crowdfunding-.html)**. Please note that the use of the internet for raising capital is not restricted to crowdfunding as provided for in the above rules. Many online platforms are used to raise capital under other prospectus exemptions such as the accredited investor exemption or the offering memorandum exemption. **MI 45-108 Exemption in effect in Alberta, Manitoba, Ontario, Québec, New Brunswick and Nova Scotia** If a small business wants to raise money from investors in the provinces of Alberta, Manitoba, Ontario, Québec, New Brunswick and Nova Scotia (“participating jurisdictions”) it can rely on Multilateral Instrument 45-108 Crowdfunding (“**MI 45-108 Exemption**”). MI 45-108 provides a framework for crowdfunding portals. The MI 45-108 Exemption provides a prospectus and registration exemption and imposes a number of requirements on issuers and crowd funding portals including: **Type of securities**: Issuers can only offer non-complex securities such as common shares, non-convertible preferred shares, certain convertible securities and non-convertible debt, flow through shares and units in a limited partnership. **Restrictions on offerings:** Issuers (and their “issuer groups”) can only raise $1.5 million in a 12-month period under the MI 45-108 Exemption. Issuer groups include affiliates, controlled entities and entities involved in a common enterprise. The offering can only continue for 90 days. **Issuers:** MI 45-108 is available to entities organized or incorporated in Canada, with a head office in Canada and with the majority of directors resident in Canada. The exemption is available to reporting issuers as well as private companies. **Investment limits**: Investors are subject to the following investment limits: 1. an investor that does not qualify as an accredited investor: - $2,500 per investment, and - in Ontario, $2,500 per investment and $10,000 in total in a calendar year, 2. an accredited investor other than a permitted client: - $25,000 per investment, and - in Ontario, $25,000 per investment and $50,000 in total in a calendar year, 3. in Ontario, no investment limits for a permitted client. **Offering documents / risk acknowledgment forms:** Issuers are required to prepare an offering document that contains information about the issuer and its business and sign a certificate which certifying that the offering document does not include a misrepresentation. The disclosure must be read by the investor before purchasing the issuer’s securities. The issuer may also provide other materials such as term sheets and videos to investors and materials summarizing the offering document. Investors must complete a risk acknowledgement form requiring them to positively confirm having read and understood the risk warnings and information in the crowdfunding offering document before they can enter into an agreement to purchase securities. **Statutory / Contractual rights**: Issuers are accountable for, and are subject to, a standard of liability on the crowdfunding offering document and other permitted materials, and investors are provided with a related right of action. The standard for non-reporting issuers is an “untrue statement of material fact.” For reporting issuers, the standard is a “misrepresentation” which include untrue statements and omissions. Investors have a right of rescission for a misrepresentation for a 180 period after the purchase and a right of action for damages within 180 days of the investor becoming aware of the misrepresentation or statement or three years from the date of purchase whichever is earlier. Investors have the right to withdraw from a purchase within 48 hours of the date of the purchase agreement or any amendment to the disclosure document. **Advertising restrictions:** There is a prohibition on advertising and general solicitation. Issuers may only inform purchasers that it proposes to distribute securities under the MI 45-108 Exemption and direct purchasers to the funding portal. Funding portals are allowed to advertise its business but prohibited from recommending or endorsing a particular issuer or distribution, including highlighting or showcasing an issuer or its distribution. **Ongoing disclosure**: Non-reporting issuers must make available to investors (i) annual financial statements (audited in some circumstances) within 120 days of the end of the financial year, (ii) an annual notice of use of proceeds, and (iii) in New Brunswick, Nova Scotia and Ontario, a notice of a discontinuation of the issuer’s business, a change in the issuer’s industry or a change of control of the issuer. Non-reporting issuers must continue to with these disclosure requirements until the issuer is becomes a reporting issuer, is wound up or dissolved, there are fewer than 51 shareholders. Reporting issuers must continue to comply with all of their disclosure requirements. Non-reporting issuers must keep certain material for 8 years. **Issuer filing requirements*:*** Report of trade forms must be filed by issuers with the applicable securities commissions within 10 days of the closing of the distribution along with a copy of the offering document and all materials provided to investors (except any videos which is on request from a securities regulator). **Commissions or fees**: No person in the issuer group may pay a commission, finder’s fee or referral fees to any person in connection with a distribution except to the funding portal. A restricted dealer may pay a referral fee to a third party but cannot participate in a referral arrangement. **Portal requirements**: Issuers can only distribute securities through a single funding portal that is registered as an investment dealer, exempt market dealer or restricted dealer, and must post the offering document and other permitted materials solely on that funding portal’s online platform. Investment dealers and exempt market dealers must comply with all of the requirements of their registration, including know your client and suitability. Funding portals are prohibited from offering securities of a related issuer but can offer real estate securities. A funding portal must fulfill certain gatekeeper responsibilities prior to allowing an issuer access to its online platform, including reviewing the issuer’s disclosure in the crowdfunding offering document and other permitted materials for completeness, accuracy and any misleading statements, a funding portal must review information and obtain background checks on the issuer and its directors, executive officers and promoters (including criminal checks), and deny an issuer access to the funding portal in certain circumstances. Funding portals must have a chief compliance officer who has met certain proficiency requirements. **Start-up Exemption in British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia** The provinces of British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia have another form of a crowdfunding exemption which is found in local blanket rulings of the specific provinces (“**Start-up Exemption**”). The start-up exemption orders found in the local blanket rulings will expire on May 13, 2020. The Start-up Exemption differs from the MI 45-108 Exemption in that there is no requirement for portal registration, the maximum raises are lower and the provisions are generally less prescriptive. The following is a summary of the Start-up Exemption under the local blanket orders of British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia (“participating jurisdictions”). The Start-up Exemption provides a registration and prospectus exemption. **Type of securities***:* The Start-up Exemption is limited to distributions by an issuer of securities of its own issue and to certain types of securities: common shares, non-convertible preference shares, securities convertible into common shares or non-convertible, preference shares, non-convertible debt securities linked to a fixed or floating interest rate; and units of a limited partnership. **Restrictions on offerings**: The issuer (and the issuer group) cannot raise aggregate funds totaling more than $250,000 per distribution. Offerings cannot remain open for more than 90 days. The exemption cannot be used more than twice in a calendar year. The minimum amount must be equal to the amount needed to carry out the purpose for which the funds are sought. There can be no concurrent offerings using the exemption for the same project. **Issuers*:* The Start-up Exemption is not available for reporting issuers. The issuer’s head office must be located in Canada and the majority of the directors must be Canadian residents. This exemption is not available to investment funds. None of the promoters, directors, officers and control persons (collectively, the principals) of the issuer group can be a principal of the funding portal. Each promoter, officer, director and control person of the issuer must deliver a complete individual information form at least 10 business days prior to beginning to trade. **Investment limits:** An investor cannot invest more than $1,500 in a single investment under the Start-Up Exemption. **Offering document / risk acknowledgement** **form*:*** Issuers must provide standardized offering document that includes basic information about the issuer, its management and the distribution, including how the issuer intends to use the funds raised and the minimum offering amount. No financial statements are required. Investors must be provided with a risk warning that includes that: the investor understands they may lose their entire investment; the investor understands the illiquid nature of the investment; the investor has read and understood the offering document; the investment opportunity has not been approved by a participating jurisdiction; the investor has not received advice from the portal or the government of a participating jurisdiction; the investor doesn’t have as many legal rights when purchasing under this exemption as they would through a prospectus offering; and they reside in a participating jurisdiction. Offering documents are required to disclose minimum offering size and whether there is a maximum offering size. The funding portal must make the offering document of the issuer and the risk warnings available online to purchasers and does not allow a subscription until the purchasers have confirmed that they have read and understood the documents. **Statutory / contractual rights**: The issuer must grant individual purchasers a contractual right to withdraw their offer to purchase securities within 48 hours of the purchaser’s subscription or notification to the purchaser that the offering document has been amended or if the start-up crowdfunding distribution is withdrawn by the issuer. If the minimum raise is not achieved the portal must return the funds to the purchasers. **Ongoing disclosure**: There is no requirement for ongoing disclosure above any corporate requirements. **Issuer reporting requirements*:*** Report of trade forms along with the offering document must be filed by issuers within 30 days of the closing of the distribution. **Commissions or fees:** The funding portal cannot receive a fee from any purchaser of the securities sold through the portal. **Portal requirements:** There is no registration requirement for the portals relying on the Start- up Exemption. The distribution must be made through a funding portal that is either relying on the Start-up Exemption or is operated by a registered dealer. Funding portals relying on the exemption must file certain forms with the securities regulators more than 30 days before commencing capital raising. The funding portal cannot provide advice to a purchaser or otherwise recommend or represent that an eligible security is suitable, or about the merits of the investment. The funding portal must maintain books and records at its head office to accurately record its financial affairs and client transactions, and to demonstrate the extent of the funding portal’s compliance with the Start-up Exemption orders for a period of eight years from the date a record is created. **ASC 45-517 Exemption in Alberta** ASC Rule 45-517 was introduced to help facilitate Alberta-based small or start-up issuers seeking to raise small amounts of capital. ASC Rule 45-517 allows issuers to rely on the exemption with or without a funding portal or other registered dealer. ASC Rule 45-517 provides a prospectus exemption but not a registration exemption. An issuer can raise funds in reliance on the exemption through a registrant or the issuer’s own network of contacts provided that the issuer is not in the business of trading securities. The ASC Rule 45-517 requirements include the following: **Type of securities:** Only certain types of securities can be sold under the crowdfunding exemption: common shares; certain types of preference share; a security convertible into a common share or preference share; a non-convertible debt security linked to a fixed or floating interest rate; or certain shares issued under the *Cooperatives Act* (Alberta); and limited partnership units. **Restrictions on offerings:** The aggregate funds raised by an issuer together with all funds raised by members of the “issuer group” cannot exceed $1,000,000. This is a lifetime limit. The funds raised in any one distribution cannot exceed $250,000. Issuers can only have two offerings per year. **Issuers:** The issuer cannot be an investment fund nor a reporting issuer in Canada nor one that is subject to reporting obligations in a foreign jurisdiction. The head office of the issuer must be located in Alberta or a Canadian jurisdiction with a corresponding crowdfunding exemption. **Investment limits:** The acquisition cost of the securities acquired by the investor cannot exceed $1,500 unless a registered dealer provides the investor with positive suitability advice in respect of the purchase, in which case the maximum acquisition cost of the securities acquired by an investor is $5,000. **Offering documents/ risk acknowledgement forms:** At the same time or before the investor signs the agreement to purchase the security, the issuer or, if the issuer has retained a registered dealer in respect of the distribution, the dealer (i) delivers to the investor an offering document in the prescribed form, and (ii) obtains a risk acknowledgment in the prescribed form from the investor which evidences that the investor has read and understood the contents of that form. The offering documents must contain a certificate which states that the document does not include a statement that is misleading or untrue. Any financial statements provided to investors must be made in accordance with Canadian GAAP applicable to reporting issuers. **Statutory / contractual rights:** The issuer provides to the investor a contractual right to withdraw the investor’s offer to purchase the security which right can be exercised by the investor delivering a notice to the issuer or, if the issuer has retained a registered dealer in respect of the distribution, the dealer within 48 hours of the later of (i) the investor’s subscription, and (ii) an amended offering document being delivered to the investor. **Issuer filing requirements:** The issuer must file a report of trade along with the offering document with the ASC within 30 days of any distribution on SEDAR. **Commissions or fees:** No commission, fee or payment can be made to the issuer or the issuer group or any founders, control persons or promoters of the issuer. **Portal Requirements:** Funding portals must be registered as an exempt market dealer to take advantage of the ASC exemption. The exemption can also be used to raise money through an investment dealer or an exempt market dealer where the dealer will solicit investments and distribute securities through “traditional distribution channels”. For information on crowdfunding 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. **Categories:** News & Updates --- ### [Barbara Hendrickson Has Been Granted The Martindale-Hubbell’s  AV Preeminent® Rating](https://baxsecuritieslaw.com/barbara-hendrickson-granted-martindale-hubbells-rating/) **Published:** January 31, 2017 **Author:** Barbara Hendrickson **Excerpt:** This being the highest peer rating standard. This rating signifies that the lawyer's reviewed peers rank him or her at the highest level of professional excellence for their legal knowledge, communication skills and ethical standards. Martindale-Hubbell® Peer Review Ratings™ are the gold standard in lawyers ratings,... **Content:** This being the highest peer rating standard. This rating signifies that the lawyer’s reviewed peers rank him or her at the highest level of professional excellence for their legal knowledge, communication skills and ethical standards. Martindale-Hubbell® Peer Review Ratings™ are the gold standard in lawyers ratings, and have been for more than a century. Lawyers looking to refer a client, as well as individuals researching lawyers for their own legal needs, use these ratings to identify, evaluate and select the most appropriate lawyer for their legal issue. **Categories:** News & Updates --- ### [Barbara Hendrickson - A Proud Alumni of University of Calgary Law School](https://baxsecuritieslaw.com/barbara-hendrickson-a-proud-alumni-of-university-of-calgary-law-school/) **Published:** February 7, 2017 **Author:** Barbara Hendrickson **Excerpt:** Over the last 40 years the University of Calgary Law School has distinguished itself on the Canadian legal landscape as as a leader in innovative approaches to legal education and expertise on law and policy relating to Canada’s natural resources. Barbara Hendrickson is very proud... **Content:** Over the last 40 years the University of Calgary Law School has distinguished itself on the Canadian legal landscape as as a leader in innovative approaches to legal education and expertise on law and policy relating to Canada’s natural resources. Barbara Hendrickson is very proud to have been among the early graduating classes of the University of Calgary Law School. Barbara is honoured to be featured as an alumni on the University of Calgary Law School website. https://law.ucalgary.ca/alumni/meet-alumni/hendrickson **Categories:** News & Updates --- ### [Canadian Securities Administrators (CSA) Staff Notice 54-305 Meeting Vote Reconciliation Protocols, March 4, 2017](https://baxsecuritieslaw.com/canadian-securities-administrators-csa-staff-notice-54-305-meeting-vote-reconciliation-protocols/) **Published:** March 7, 2017 **Author:** Barbara Hendrickson **Excerpt:** On January 26th, 2017, the Canadian Securities Administrators (CSA) published in final form CSA Staff Notice 54-305, Meeting Vote Reconciliation Protocols (Protocols). Meeting vote reconciliation consists of the processes used to tabulate proxy votes for shares held through intermediaries. The Protocols contain: • CSA staff... **Content:** On January 26th, 2017, the Canadian Securities Administrators (CSA) published in final form CSA Staff Notice 54-305, *Meeting Vote Reconciliation Protocols* (Protocols). Meeting vote reconciliation consists of the processes used to tabulate proxy votes for shares held through intermediaries. The Protocols contain: • CSA staff expectations on the roles and responsibilities of the key entities that implement meeting vote reconciliation (CDS; intermediaries (bank custodians and investment dealers); the primary intermediary voting agent, Broadridge, and transfer agents who act as meeting tabulators); and • guidance on the kinds of operational processes that they should implement to support accurate, reliable and accountable meeting vote reconciliation. CSA Staff Notice 54-305 follows on the March 31, 2016 CSA Multilateral Staff Notice 54-304 Final Report of the Proxy Voting Infrastructure and Request for Comments on Proposed Meeting Vote Reconciliation Protocols. In the view of the CSA, given the importance of shareholder voting to the quality and integrity of Canadian capital markets, reconciliation needs to be accurate, reliable and accountable. As set out in the Protocols, accurate, reliable and accountable meeting vote reconciliation has the following characteristics: • accurate and complete vote entitlement information for each intermediary that will solicit voting instructions from beneficial owners and submit proxy votes is provided to meeting tabulators; • meeting tabulators set up vote entitlement accounts for each intermediary in a consistent manner; • accurate and complete proxy vote information is provided to the meeting tabulator, and meeting tabulators tabulate and record the proxy votes in a consistent manner; • beneficial owners know if proxy votes submitted to the meeting tabulator in respect of their shares were not accepted at a meeting and the reason why. It is the view of CSA staff that the Protocols have been developed taking into account existing operational processes and should not require a major technological overhaul of existing systems. The CSA also acknowledges that, if the key entities can identify and implement alternative ways to achieve accurate, reliable and accountable meeting vote reconciliation, the Protocols should not be viewed as preventing them from doing so. The Protocols are voluntary and are meant to lay the foundation for the key entities to work collectively to eliminate paper and move to electronic transmission of vote entitlement and proxy vote information, and develop end-to-end vote confirmation capability that would allow beneficial owners, if they wish, to receive confirmation that their voting instructions have been received by their intermediary and submitted as proxy votes, and that those proxy votes have been received and accepted by the tabulator. These Protocols have been drafted with specific reference to meeting vote reconciliation for uncontested meetings. However, some of the expectations and guidance are also relevant to meeting vote reconciliation for proxy contests and should be taken into account where appropriate. The CSA intends to monitor industry initiatives in these areas. While acknowledging that the Protocols do not address client account vote reconciliation, the CSA encourages intermediaries to establish, maintain and apply written policies and procedures that specify: • how they determine which beneficial owner clients have voting entitlements for a particular meeting (including how this information is communicated to beneficial owner clients); • how they reconcile voting entitlements to their positions with CDS, DTC or other intermediaries, and • appropriate internal safeguards and controls to monitor the effectiveness of those processes. Please refer to *Appendix A: Meeting Vote Reconciliation Flowchart* which outlines at a high-level the information flows for meeting vote reconciliation assuming the processes outlined in the Protocols are implemented. CSA Staff Notice 54-305 is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170126_54-305_meeting-vote.htm) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [Binary Options Fraud, March 13, 2017](https://baxsecuritieslaw.com/binary-options-fraud-march-13-2017/) **Published:** March 13, 2017 **Author:** Barbara Hendrickson **Excerpt:** On March 2, 2017, the Canadian Securities Administrators (CSA) issued a warning to Canadians about binary options fraud. The CSA had formed the Binary Options Task Force to raise awareness and protect Canadians from binary options scams. It has launched a new resource site, www.BinaryOptionsFraud.ca,... **Content:** On March 2, 2017, the Canadian Securities Administrators (CSA) issued a warning to Canadians about binary options fraud. The CSA had formed the Binary Options Task Force to raise awareness and protect Canadians from binary options scams. It has launched a new resource site, [www.BinaryOptionsFraud.ca](http://www.BinaryOptionsFraud.ca), as part of a campaign to educate Canadians about the serious financial dangers posed by binary options trading. The CSA has identified binary options fraud is a leading type of investment fraud facing Canadians today. The CSA warns that no registered individuals or firms are permitted to trade binary options in Canada. [http://www.osc.gov.on.ca/en/NewsEvents\_nr\_20170302\_binary-options-fraud.htm](http://www.osc.gov.on.ca/en/NewsEvents_nr_20170302_binary-options-fraud.htm) Binary options take the form of a wager in which investors bet on the performance of an underlying asset, often a currency, stock index, or share, and the timeframe on this bet is typically very short, sometimes hours or even minutes. When the ‘investment’ period is up, the investor receives a predetermined payout or loses the entire amount. Binary options “traders” rely on websites and social media ads to market their product. The current CSA warning against binary options trading follows on earlier warnings published by the CSA on March 9, 2015 http://www.osc.gov.on.ca/en/NewsEvents\_nr\_20150309\_binary-option.htm and on March 16, 2016 http://www.osc.gov.on.ca/en/NewsEvents\_nr\_20160323\_csa-alert-beware-binary-options.htm On February 1, 2017 the Autorite des marches (“AMF”) Quebec’s securities regulatory authority, published proposed amendments to the Derivatives Regulation under the Quebec Derivatives Act which would effectively ban the sale of short term binary options to Quebec residents. 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. **Categories:** News & Updates --- ### [CSA Staff Notice 51-348 Staff’s Review of Social Media Used by Reporting Issuers, March 12, 2017](https://baxsecuritieslaw.com/csa-staff-notice-51-348-staffs-review-social-media-used-reporting-issuers-march-12-2017/) **Published:** March 12, 2017 **Author:** Barbara Hendrickson **Excerpt:** On March 9th, 2017, the Canadian Securities Administrators (“CSA”) published CSA Staff Notice 51-348 Staff’s Review of Social Media Used by Reporting Issuers (“Staff Notice”). The Staff Notice summarizes the finding of the Alberta, Ontario and Québec securities commissions after a review of the social... **Content:** On March 9th, 2017, the Canadian Securities Administrators (“CSA”) published CSA Staff Notice 51-348 *Staff’s Review of Social Media Used by Reporting Issuers* (“Staff Notice”). The Staff Notice summarizes the finding of the Alberta, Ontario and Québec securities commissions after a review of the social media disclosure of 111 reporting issuers (“Review”). The Review covered disclosure on Facebook, Twitter, YouTube, Linkedin, Instagram and GooglePlus as well as message boards and blogs. The Review was carried out to determine if the disclosure review was consistent with *National Policy 51-201*, Disclosure Standards and the requirements of *National Instrument 51-102 Continuous Disclosure Obligations.* As a result of the Review, 25% of issuers reviewed took corrective action and filed clarifying disclosure on SEDAR, removed inappropriate social media disclosure and, or committed to improving disclosure and governance practices. The Staff Notice reports that 77% of issuers had not developed a specific governance policy with respect to disclosure practices on social media websites. The Staff Notice identifies several areas of concern where issuers need to improve their disclosure practices: • Selective or early disclosure when some investors receive material information through social media that other investors do not receive because it is not generally disclosed. • Misleading and unbalanced social media disclosure where information is not sufficient to provide a complete picture or is inconsistent with information already disclosed by issuers on SEDAR. • Forward looking information (“FLI”) that provides key information on future prospects without ensuring that the information was generally disclosed. FLI tended not to comply with other disclosure obligations related to forward looking information. • Lack of coordination on the timing of social media announcements with other press releases, filings etc. • Third party posts on social media which is inconsistent with the issuer’s own disclosure. • Social media postings being untrue, unduly promotional or unbalanced. • Social media disclosure linked to other documents such as analyst reports without complying with securities requirements. • Figures disclosed on social media not being GAAP compliant. • Insufficient social media governance policies in place to support social media activity. According to the Staff Notice, a strong media governance policy should cover the following: • Who monitors the issuer’s social media accounts. • Who can post information on social media. • What types of sites can be used. • What type of information can be posted. • What approvals are required before posting. • Other guidelines and best practices e.g. identifying the relationship of person doing the posting to the issuer. According to the Staff Notice, the CSA will continue to monitor the problem areas identified in the Review. The CSA expects that those issuers that are not in compliance will take corrective action. CSA Staff Notice 51-348 is available for download from the websites of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [OSC Highlights Potential Securities Law Requirements for Businesses Using Blockchain Technologies, March 13, 2017](https://baxsecuritieslaw.com/osc-highlights-potential-securities-law-requirements-businesses-using-blockchain-technologies-march-13-2017/) **Published:** March 13, 2017 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) published a news release on March 8th, 2017 advising businesses that use distributed ledger technologies (“DLT”), such as blockchain, as part of their financial products or service offerings that they may be subject to Ontario securities law requirements. http://www.osc.gov.on.ca/en/NewsEvents_nr_20170308_osc-highlights. The press... **Content:** The Ontario Securities Commission (OSC) published a news release on March 8th, 2017 advising businesses that use distributed ledger technologies (“DLT”), such as blockchain, as part of their financial products or service offerings that they may be subject to Ontario securities law requirements. [http://www.osc.gov.on.ca/en/NewsEvents\_nr\_20170308\_osc-highlights](http://www.osc.gov.on.ca/en/NewsEvents_nr_20170308_osc-highlights). The press release provides that some uses of this technology could trigger securities law requirements. According to the OSC: ”Businesses are using DLT in a variety of ways. DLT may be used as the underlying technology in trading, clearing and settling securities. For example, DLT may be used to facilitate issuances of equity and debt securities and to track their ownership. DLT are core to a growing number of new virtual or digital assets. Businesses may also, for example, facilitate initial coin or token offerings where ownership of the coins or tokens is tracked using DLT, or may establish investment funds with DLT-based virtual currencies in their portfolios. Products or other assets that are tracked and traded as part of a distributed ledger may be securities, even if they do not represent shares of a company or ownership of an entity.” The press release suggests that businesses that are operating or planning to operate a DLT-based venture should consider the different types of offerings that involve securities within the meaning of the Ontario Securities Act; the types of trading activities that will occur; and whether registration as a dealer, adviser and/or 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Announce Climate Change Disclosure Review Project](https://baxsecuritieslaw.com/canadian-securities-administrators-announce-climate-change-disclosure-review-project/) **Published:** March 27, 2017 **Author:** Barbara Hendrickson **Excerpt:** On March 21, 2017, the Canadian Securities Administrators (CSA) announced that they are launching a project to review the disclosure of risks and financial impacts associated with climate change (“Disclosure Review Project”). The project will gather information on the current state of climate change disclosure... **Content:** On March 21, 2017, the Canadian Securities Administrators (CSA) announced that they are launching a project to review the disclosure of risks and financial impacts associated with climate change (“Disclosure Review Project”). The project will gather information on the current state of climate change disclosure in Canada and internationally, and will include consultations with investors and public companies. The Disclosure Review Project, follows on a number of international initiatives on the disclosure practices of public companies regarding climate-related risks and financial impacts. Several voluntary disclosure frameworks have been proposed, culminating in the publication in December 2016 of a set of recommendations by the G20’s Financial Stability Board’s Task Force on Climate-related Financial Disclosures chaired by Michael Blomberg. Currently, reporting issuers in Canada are required to disclose material risks, which may include risks associated with climate change, among other environmental matters in their periodic disclosure. In 2010, the CSA published [CSA Staff Notice 51-333 Environmental Reporting Guidance](https://www.bcsc.bc.ca/Securities_Law/Policies/Policy5/PDF/51-333__CSA_Staff_Notice___October_27__2010/), which provided guidance to reporting issuers (other than investment funds) on existing continuous disclosure requirements relating to environmental matters under securities legislation in Canada. The Disclosure Review Project is designed to review various matters in relation to the disclosure risks and financial impacts associated with climate change. The Disclosure Review Project includes three key components: *1. Review of international disclosure requirements and voluntary frameworks:* CSA staff will review climate-related disclosure requirements under the securities laws of jurisdictions such as Australia, the United Kingdom, and the United States. They will also review recommendations contained in recently proposed voluntary disclosure frameworks with respect to climate-related disclosure, including: • International Integrated Reporting Framework published by the International Integrated Reporting Council • Global Standards for Sustainability Reporting published by the Global Reporting Initiative • Climate Risk Technical Bulletin published by the Sustainability Accounting Standards Board • Recommendations of the Task Force on Climate-Related Financial Disclosures published by the Financial Stability Board. *2. Review of continuous disclosure by reporting issuers:* CSA Staff intends to review the mandatory continuous disclosure filings and voluntary sustainability reports of large TSX-listed reporting issuers for the 2016 financial year to assess the extent to which these filings currently include disclosure concerning material climate-related risks and financial impacts, and the governance processes related to them. *3. Consultations:* CSA staff will gather feedback from reporting issuers on climate-related disclosure and the associated costs. They will also consult with investors regarding the appropriate level of climate-change disclosure required for them to make informed investment decisions. These consultations will occur through an anonymous online survey of reporting issuers as well as focus groups with investors and reporting issuers. The CSA expects to conduct its information gathering in spring and summer of 2017 and publish a progress report outlining its findings upon completing its review. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publishes 2016 Enforcement Report](https://baxsecuritieslaw.com/canadian-securities-administrators-publishes-2016-enforcement-report/) **Published:** April 3, 2017 **Author:** Barbara Hendrickson **Excerpt:** On February 27, 2017, The Canadian Securities Administrators (CSA) published its 2016 Enforcement Report (The Report).  The ninth annual report highlights actions taken by the CSA to police the capital markets. The report states that as a result of increased cooperation between the CSA and... **Content:** On February 27, 2017, The Canadian Securities Administrators (CSA) published its 2016 Enforcement Report (The Report). The ninth annual report highlights actions taken by the CSA to police the capital markets. The report states that as a result of increased cooperation between the CSA and the RCMP, both the number of successfully concluded criminal proceedings and the amount jail time rose during the last year. The CSA introduced new measures to fight insider trading and tipping and a market analytics program aimed at detecting securities violations in trades made through automated trading systems. Highlights of the 2016 report include: - 39 years of jail time ordered for those committing securities-related misconduct. - $299 million in compensation that respondents undertook to return to investors through no-contest settlements and $51 million in restitution and disgorgement orders. - 120 people and 82 companies placed under interim and asset freeze orders, preventing further harm to investors. - 109 concluded cases. - $62,148,866 in fines, administrative penalties, and other voluntary payments. The Report highlights the growing “serious and growing problem” of penny-stock “pump-and-dump” fraud, where fraudsters artificially inflate the price of shares through misleading information in order to sell them at a profit before their price crashes. The Report discusses a number of “ponzi schemes” that were successfully prosecuted for fraud. The Report defines “ponzi schemes” as “a fraudulent activity in which the promised rate of return on an investment is paid to initial investors using funds provided by subsequent investors.” A number of illegal distributions, where sale or attempted sales of securities to investors failed to comply with securities registration, prospectus and report of trade requirements are also discussed in the Report. The full 2016 Enforcement Report is [available for download](http://www.csasanctions.ca/) from the CSA’s website. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Seeking Input on Proposed Conduct Rules for Derivatives Dealers and Advisors, April 7, 2017](https://baxsecuritieslaw.com/canadian-securities-regulators-seeking-input-proposed-conduct-rules-derivatives-dealers-advisors-april-7-2017/) **Published:** April 10, 2017 **Author:** Barbara Hendrickson **Excerpt:** On April 4, 2017, the Canadian Securities Administrators (CSA) published for comment Proposed National Instrument 93-101 Derivatives: Business Conduct (“Proposed Instrument”) and a related proposed companion policy, 93-101 Derivatives: Business Conduct (“Proposed CP”). The comment period will last 150 days, closing on September 1, 2017, during... **Content:** On April 4, 2017, the Canadian Securities Administrators (CSA) published for comment Proposed National Instrument 93-101 *Derivatives: Business Conduct* (“Proposed Instrument”) and a related proposed companion policy, 93-101 Derivatives: Business Conduct (“Proposed CP”)*.* The comment period will last 150 days, closing on September 1, 2017, during which the CSA is inviting specific feedback from stakeholders. The goal of the proposed Instrument and CP is to protect investors, improve transparency and accountability, and protect against market abuse. The proposed Instrument establishes an investor protection regime for over-the-counter (OTC) derivatives markets that is consistent with international standards and foreign requirements and is intended to create a uniform approach to derivatives business conduct regulation in Canada. It sets out fundamental obligations for OTC derivatives dealers and advisers. These include: - a fair dealing model suitable for derivatives markets that contains obligations to identify and respond to conflicts of interest; - know-your-derivatives party obligations; and, - compliance and recordkeeping requirements. For derivatives dealers and advisers working with non-institutional counterparties, the proposed instrument introduces further measures such as a derivatives-specific suitability standard, the requirement to identify derivatives party-specific needs, and disclosure regarding leverage. While noting that a “significant proportion” of OTC derivatives trading is cross-border, the proposed Instrument includes exemptions for foreign derivatives dealers and advisers that are subject to and comply with comparable laws of certain foreign jurisdictions. The CSA is also in the process of developing a registration regime for derivatives dealers and advisers. The CSA anticipates publishing proposed NI 93-102 *Derivatives: Registration* shortly. The CSA recommends that stakeholders consider the proposed registration regime in conjunction with the proposed Instrument and CP. The proposed National Instrument 93-101 *Derivatives: Business Conduct* and the proposed Companion Policy, 93-101 *Derivatives: Business Conduct*, are [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170404_93-101_rfc-derivatives.htm) from the websites of CSA members. 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. **Categories:** News & Updates --- ### [First Leaside Group Divisional Court Appeal – Fraud, Misrepresentations, Penalties in a Captive Dealer Context April 27, 2017](https://baxsecuritieslaw.com/first-leaside-group-divisional-court-appeal-fraud-misrepresentations-penalties-captive-dealer-context-april-27-2017/) **Published:** May 1, 2017 **Author:** Barbara Hendrickson **Excerpt:** The recent Superior Court of Justice, Divisional Court decision in David Charles Phillips and John Russell Wilson v the Ontario Securities Commission 2016 ONSC 7901 (“Appeal Decision”) provides important insights into the application of the test for fraud under section 126.1 of the Ontario Securities Act... **Content:** The recent Superior Court of Justice, Divisional Court decision in *David Charles Phillips and John Russell Wilson v the Ontario Securities Commission* 2016 ONSC 7901 (“Appeal Decision”) provides important insights into the application of the test for fraud under section 126.1 of the Ontario *Securities Act* (“OSA”) and the basis for finding a breach of section 44(2) of the OSA regarding making false or misleading statements by registrants. The Appeal Decision also concerns the disgorgement penalty under section 127(1) of the OSA. This was an appeal from decision made on January 14, 2015 by an Ontario Securities Commission (“OSC”) panel made up of Commissioners Edward P. Kerwin and C. Wesley M. Scott (“OSC Panel”). The OSC found that David Charles Phillips and John Russel Wilson (“Appellants”) had defrauded investors by selling and overseeing sales of almost $19 million in securities while withholding certain information (“Fraud Finding”) as well as making certain misrepresentations contrary to the *Securities Act* (“Misrepresentation”) and had failed to deal with their clients honestly, fairly and in good faith. On October 28, 2015, the OSC ordered, among other things, that Appellants disgorge all of the proceeds realized from their misconduct (“Disgorgement Order”). The appeal to the Divisional Court was from the Fraud Finding, the Misrepresentation Finding and the Disgorgement Order. Wilson and Phillips did not contest that they failed to deal with their clients honestly, fairly and in good faith. The Appellants were involved with a group of companies First Leaside Group (“FLG”) that was in the business of selling real estate investment products to the public through a related exempt market dealer – First Leaside Securities Inc. (“FLS”). Phillips was the founder of the FLG and the CEO, president and director of its parent company – First Leaside Wealth Management Inc. (“FLWM”) and its sole shareholder. Phillips was also a dealing representative and ultimate designated person with FLS. Wilson was a director of FLWM and a dealing representative with FLS. By August of 2011 the FLG had 161 companies and both Canadian and US limited partnerships formed to acquire and own real estate. The background of the OSC Involvement are as follows: - In late 2010 or early 2011, the FLG provided OSC Staff with a valuation of one of their properties – Wimberly Apartments LP – a US limited partnership that held the FLG’s Texas real estate holdings. At the time the US limited partnership had about 1000 investors. - In March 2011, the OSC asked that a viability study of FLG be conducted and Grant Thornton LLP was retained to conduct the study. - On August 19, 2011 Grant Thornton completed the report (“Report”) which found among other things that “the future viability of FLG was contingent upon its ability to raise new capital” and that a “Base Model” be adopted where funds would siloed in each LP; that the practice of moving cash between the LPs would be stopped and that they would stop using new investor moneys to fund existing projects. The Report also found that if the Group was restricted from raising new capital that the Group would be “unable to continue its operations in the ordinary course.” - On September 1, 2011 FLG’s lawyers and Grant Thornton met with the OSC to discuss the Report. The OSC staff said that they had not yet accepted the Base Model but they had no immediate plans to take further steps. - August 22 – October 28th, 2011 FLG continued to sell FLG securities for a total of $18,765,168. - October 28, 2011 OSC Staff advised the FLG that it intended to commence an action against FLG and will bring an application for an immediate cease trade order. - November 7, 2011 FLG wrote to investors and advised them for the first time about the Report and said that they had voluntarily cease trading. - February 2012 a substantial part of the FLG sought creditor protection under the *Companies’ Creditors Arrangement Act*. - On June 4, 2012 the OSC filed a Statement of Allegations and on April 23, 2013 an amended Statement of Allegations. - June 5 – September 25, 2013 an OSC hearing on the merits took place. - January 14, 2014 the OSC released its decision. - October 28, 2015 the OSC made a series of order against Wilson and Phillips. - September 22, 2016 the Divisional Court released its decision. **Fraud Finding** Section 126.1 (1)(b) of the OSA provides that a person or company shall not directly or indirectly engage or participate in any act, practice or course of conduct relating to securities … that the person knows or reasonably ought to know … perpetrated a fraud on any person or company.” The OSC found that Appellants had breached section 126.1 (1)(b) of the OSA. The OSC found that the Report and its contents should have been disclosed to investors who invested in the FLG companies during the sales period. The following contents of the Report were identified: - FLG’s LP’s could not continue to cover the FLG’s stated distributions; - an asset valuation had disclosed a significant equity deficit (assets were worth $67 million while the FLG had raised approximately $200 million resulting in a “significant shortfall”); - cash flow deficiency of approx. $15.9 million extended over a three-year period of 2011 – 2013. The OSC applied the test for fraud set out by the SCC in *R v Theroux* 1993 CanL.II 134 (SCC) – the *actus reus* of fraud is the proof of prohibited act, “be it an act of deceit, a falsehood or some other fraudulent means” and deprivation caused by prohibited act, which “may consist of actual loss or the placing of the victim’s pecuniary interests at risk”. “Other fraudulent means” includes non-disclosure of important facts. The test for “other fraudulent means” was determined by the SCC to be such means which is “determined objectively by reference to what a reasonable person would consider to be a dishonest act”. The OSC found that Appellants knew the Report contained important facts that they did not disclosure to investors during the sales period and that the Appellants knew that the likely consequences to the investors of the non-disclosure would be deprivation or the risk of deprivation and that they therefore committed fraud. Failure to disclose constituted a “dishonest act” which caused deprivation by putting the financial or pecuniary interests of FLG’s investors at risks. Wilson and Phillips appealed the finding of fraud on the basis that the OSC’s reason did not disclose whether it undertook the objective analysis prescribed by the SCC. According to the Appellants, the OSC Panel simply went from a finding of non- disclosure to of important facts to a finding of fraud by “other fraudulent means”. In her decision, Justice Sachs pointed to “significant information” in the Report “that could adversely affect the pecuniary interests of anyone who invested in FLG, namely that FLG could not meet its distributions, that it had a significant equity deficit and that it had a cash flow deficit.” Justice Sachs stated that “the Commission’s implicit conclusion that the non-disclosure in this case would be regarded by a reasonable person as dishonest, and therefore its conclusion that the allegations were made out, was reasonable.” Wilson and Phillips had also argued that a finding of fraud must be reviewed on a standard of correctness, as fraud is a question of general law of central importance to the legal system as a whole and therefore it was a question that was outside of the Commission’s area of expertise (“General Law Exception”). Justice Sachs, referring to *McLean v. British Columbia (Securities Commission)* 2013 SCC 67, stated that in order to rebut the presumption on the basis of the General Law Exception, the question must be both of central importance to the legal system and outside of the tribunals’ area of expertise. Justice Sachs found that the OSC applied developed jurisprudence to the facts before it and that securities fraud was squarely within the OSC’s expertise and that therefore the presumption had not been rebutted and the applicable standard of review was correctness. **Misrepresentation Finding** Phillips and Wilson challenged the “Misrepresentation Finding” on the basis that the OSC Panel breached the rules of natural justice by grounding the finding of misrepresentation on conduct not alleged in the amended Statement of Allegations. Justice Sachs rejected this argument on the basis that a statement of allegations under a prosecution under the OSA is not the same as a criminal information or indictment because of the OSC’s public interest jurisdiction and that the Statement of Allegations did allege misrepresentations even though it did not refer to the specific evidence of the breach. Justice Sachs also pointed to the fact that the evidence used to establish a violation was in the possession of the FLG and the Appellants did not raise this issue earlier in the proceedings. Another argument put forward by the Appellants was that the OSC Panel had committed an error of law in failing to find that establishing reliance by the investor was essential to a finding of misrepresentation under the OSA. Justice Sachs stated that: “All that is necessary is to establish that a reasonable investor would consider the statements relevant to his or her decision about whether to make the investment.” **Disgorgement Order** The OSC Panel required that Phillips disgorge $16,587.254 representing the full amounts raised by him, and others under his supervision and direction and Wilson disgorge $7,817,739 presenting the amounts that he had personally raised from investors. Wilson and Phillips argued that the OSC Panel erred in its application of the test for disgorgement when it ordered that Appellants to disgorge amounts that they had not actually obtained for themselves and when those amounts had gone to entities that were not named respondents in the OSC proceedings. Justice Sachs found that the disgorgement order was proper in the circumstances given the broad wording of the OSA which allows the disgorgement of “any amounts obtained” and has no limitation based on the individual’s use of the funds. She also pointed to the OSC’s ability to make orders of “general deterrence”. She also stated that individuals cannot shelter themselves from sanctions conducted through companies that they control. Also important was the fact that the Appellants were both registrants and therefore in positions of trust and that they had committed fraud, one of the most serious violations. **Summary** The Divisional Court decision provides important guidance for exempt market dealer in Ontario who sell related products. It also provides insight into when an OSC panel will find fraud in the context of the failure to make adequate disclosure in a private placement context. It also shows the reluctance of the court to grant an appeal from findings and decisions of the Ontario Securities Commission. 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. **Categories:** News & Updates --- ### [Mortgage Investment Corporations, April 30, 2017](https://baxsecuritieslaw.com/mortgage-investment-corporations-april-30-2017/) **Published:** May 3, 2017 **Author:** Barbara Hendrickson **Excerpt:** Introduction Mortgage investment corporations (“MICs”) are created under section 130.1 of the Income Tax Act which sets out the rules that apply to mortgage investment corporations and their shareholders. MICs primarily invest in mortgages including commercial, industrial, developmental and residential mortgages and are designed to... **Content:** **Introduction** Mortgage investment corporations (“MICs”) are created under section 130.1 of the Income Tax Act which sets out the rules that apply to mortgage investment corporations and their shareholders. MICs primarily invest in mortgages including commercial, industrial, developmental and residential mortgages and are designed to flow through income from those investments onto investors without being taxed at the corporate level. **Tax Treatment** A MIC must distribute 100% of its net annual income before taxes to shareholders in the form of dividends. MICs are entitled to deduct from its income all taxable dividends, other than capital gains dividends, paid by the MIC during the year or within 90 days of the year end and 50% of all capital gains dividends during the period commencing 90 days after the start of the year and ending 90 days after the end of the year. A MIC is deemed to be a public corporation for the purposes of the Income Tax Act. Investment in a MIC may be eligible for investment in registered products such as RRSPs, RRIFs, DPSPs, or RESPs and TFSAs. Dividends paid to shareholders, other than as a capital gains dividend, are deemed treated as interest payable on a bond. Where a dividend is paid as a capital gains dividend this amount is not included in the shareholder’s income but rather is deemed to be a capital gain. **Management of the MIC** MICs are managed by mortgage brokerage firms which are provincially registered under the Mortgage Brokers, Lenders and Administrators Act, pursuant to management agreements which set out the duties and obligations of the manager as well as annual and performance fees. The manager is responsible investing the MICs funds in suitable mortgages and administering the mortgages. Some MICs have a Credit Review Committee comprised of the manager and shareholders whose responsibility it is to review and approve mortgages to be added to the MIC’s portfolio. **Income Tax Act Requirements** A corporation will be a MIC under the section 130.1 of the Income Tax Act if throughout a taxation year: 1\. It is a “Canadian corporation” (incorporated in Canada and a resident of Canada). 2\. Its only undertaking is the investing of funds of the corporation and it does not manage or develop real or immoveable property. 3\. None of its property consists of: a. debts secured by real or immoveable property situated outside of Canada; b. debts owing to the MIC by non-resident persons (except any such debts secured on real or immoveable property situated in Canada); c. shares of corporations not resident in Canada; d. real or immoveable property situated outside of Canada or any leasehold interest in such property; 4\. There are 20 or more shareholders of the corporation and no investor is a “specified shareholder” of the corporation during the year. “Specified shareholders” are those who alone or together with related persons hold more than 25% of the issuers shares of a class of the MIC’s share capital. 5\. Preferred shareholders must have the right after payment to them of their preferred dividends and the payment of like dividends to the common shareholders, to participate pari passu with the common shareholders in any further payment of dividends paid to the common shareholders. 6\. The cost amount to the corporation of such property consisting of debts owing to the corporation that were secured by mortgages on houses (as defined in section 2 of the National Housing Act or on housing including within a “housing project” under that Act) and the amounts of any deposits with a bank or credit union or entity insured by CDIC or Quebec equivalent must be at least 50% of the cost amount of all of its property. 7\. The cost amount of all real or immoveable property including leasehold interests on such property (except property acquired by foreclosure or otherwise after a default) must not exceed 25% of the cost amount of all of its assets. 8\. The liabilities of the corporation cannot exceed three times the amount by which the cost amount of all of it properties exceeded its liabilities where at any time during the year the cost amount of its mortgages on residential property and its deposits with a bank or company was less than two thirds of the costs amounts of all of its properties. Otherwise liabilities of the MIC must not exceed five times the amount by which the cost amount to all of its properties exceeded it liabilities. **Securities Act Requirements** Investments in MICs whether through common or preferred equity are subject to securities regulation including the requirement to sell MIC securities under a prospectus or an exemption from the prospectus requirement and the requirement to comply with the dealer, advisor and investment manager registration requirements. The following guidelines are set out in CSA Guidance Staff Notice 31-323: Generally, mortgage investment entities (“MIEs”) which manage a portfolio of mortgages (“Pooled MIEs”) are only subject the investment fund manager registration if they are considered to be an “investment fund” as that term is defined under securities laws. If a Pooled MIE is an investment fund then it must ensure that the person or company that directs its business, operations or affairs is registered as an investment fund manager. A person or company that advises a Pooled MIE about buying or selling mortgages or other securities will be subject to the adviser registration requirement if it is in the business of advising in securities. The securities commissions will consider an exemption from the proficiency requirement for these individuals. A Pooled MIE will be subject to the dealer registration requirement if it is in the business of trading in securities as outlined in section 1.3 of 31-103CP. BAX Securities Law can assist with the creation and administration of a mortgage investment corporation. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson quoted in the Canadian Legal Newswire In-house Edition - Incenting Securities Snitches, May 1, 2017](https://baxsecuritieslaw.com/barbara-hendrickson-quoted-canadian-legal-newswire-house-edition-incenting-securities-snitches-may-1-2017/) **Published:** May 11, 2017 **Author:** Barbara Hendrickson **Excerpt:** For the full article, please click here! **Content:** For the full article, please **[click here!](http://canadianlawyermag.com/6428/Incenting-securities-snitches.html?utm_term=Incenting%20securities%20snitches&utm_campaign=CLIHNewswire_20170426&utm_content=email&utm_source=Act-On+Software&utm_medium=email)** **Categories:** News & Updates --- ### [Canadian Securities Regulators Publish for comment National Instrument 91-102 Prohibition of Binary Options, May 7, 2017](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-comment-national-instrument-91-102-prohibition-binary-options-may-7-2017/) **Published:** May 12, 2017 **Author:** Barbara Hendrickson **Excerpt:** On April 26, 2017, the Canadian Securities Administrators (“CSA”) (other than the British Columbia Securities Commission) published for comments, proposed National Instrument 91-102 Prohibition of Binary Options and proposed Companion Policy 91-102 Prohibition of Binary Options (together, the “Proposed Instrument”), which would prohibit the advertising,... **Content:** On April 26, 2017, the Canadian Securities Administrators (“CSA”) (other than the British Columbia Securities Commission) published for comments, proposed National Instrument 91-102 *Prohibition of Binary Options* and proposed Companion Policy 91-102 *Prohibition of Binary Options* (together, the “Proposed Instrument”), which would prohibit the advertising, selling, and trading of binary options to individuals in Canada (“CSA Notice”). The CSA Notice provides that all offerings of binary options in Canada are illegal, with binary options remain an avenue for fraud, with certain individuals continuing to mislead potential investors by promoting these products as both legal and legally offered. Binary options take the form of a wager in which investors bet on the performance of an underlying asset, often a currency, stock index, or share, and the timeframe on this bet is typically very short, sometimes hours or even minutes. These take the form of a yes/no proposition, where at the end of the “investment period,” the investor is either wins or “is in the money,” or loses and “is out of the money.” Binary options “traders” rely on websites and social media ads to market their product, which makes it difficult to determine their location. The overwhelming majority of binary options sites are rigged to lure in victims with small early returns. In many instances, no actual trading occurs, and the entire interaction takes place for the purpose of stealing money. Once larger sums are invested, the losses begin to spiral, often through unauthorized credit card withdrawals and requests to send money offshore to an unregistered firm. Once a victim has lost their money, it is almost impossible to recuperate their losses. The Proposed Instrument protects investors by prohibiting the advertising, offering, selling or otherwise trading of binary options with or to an individual. To prevent a party that offers a binary option from avoiding the prohibition by having their proposed client create a corporation or other type of entity to trade binary options, the Proposed Instrument also prohibits advertising, offering, selling or otherwise trading a binary option with or to or any other person or company that is created, or is primarily used, to trade a binary option. The Proposed Instrument sets out a definition of “binary option” that is intended to capture a range of products that are, or are similar to, products that are commonly called binary options, regardless of how they are named, including but not limited to “all-or-nothing options,” “asset-or-nothing options,” “bet options,” “cash-or-nothing options,” “digital options,” “fixed-return options,” and “one-touch options.” All contracts or instruments, however named, marketed, or sold that meet this definition will be prohibited under the Proposed Instrument. CSA staff is encouraging interested parties in participating jurisdictions to submit their comments by May 28, 2017. The public comment period expires May 29, 2017, in Alberta and Québec, June 28, 2017, in Manitoba and Saskatchewan, and July 28, 2017, in all other participating jurisdictions. The British Columbia Securities Commission (“BCSC”) has not published the Proposed Instrument for comment, but BCSC staff anticipates doing so in the near future, after obtaining necessary approval. The Proposed National Instrument is [available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170426_91-102_binary-options.htm) from the websites of participating jurisdictions. 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. **Categories:** News & Updates --- ### [CSA Staff Notice 45-323: Update on Use of the Rights Offering Exemption in National Instrument 45-106 Prospectus Exemptions, May 10, 2017](https://baxsecuritieslaw.com/csa-staff-notice-45-323-update-use-rights-offering-exemption-national-instrument-45-106-prospectus-exemptions-may-10-2017/) **Published:** May 12, 2017 **Author:** Barbara Hendrickson **Excerpt:** On April 20, 2017, the Canadian Securities Administrators (“CSA”) published CSA Staff Notice 45-323 Update on Use of the Rights Offering Exemption in National Instrument 45-106 Prospectus Exemptions which reviewed the use of the revised right offering exemption which was effective December 8, 2015 (the... **Content:** On April 20, 2017, the Canadian Securities Administrators (“CSA”) published CSA Staff Notice 45-323 *Update on Use of the Rights Offering Exemption in National Instrument 45-106 Prospectus Exemptions* which reviewed the use of the revised right offering exemption which was effective December 8, 2015 (the “Revised Offering Exemption”). The CSA Staff Notice also provides guidance based on CSA reviews of the use of the exemption. According to the CSA Staff Notice, the revised rights offering exemption was a way of addressing concerns that issuers had with the previous rights offering exemption because of the associated time and costs of that exemption. The Revised Rights Offering Exemption was designed to make prospectus-exempt rights offerings more attractive to reporting issuers. Key elements of the Revised Offering Exemption include: - a new rights offering notice that reporting issuers must file and send to security holders informing them how to access the rights offering circular electronically; - a new form of simplified rights offering circular in a question and answer format intended to be easier to prepare and more straightforward for investors to understand – it has to be filed but not sent to security holders; - a dilution limit of 100%, increased from 25%, and; - the addition of statutory secondary market liability. The CSA reviewed the use of the exemption in certain jurisdictions. The review showed that use of prospectus-exempt rights offerings increased significantly. Prior to adoption, there were approximately 13 prospectus-exempt rights offerings by Canadian reporting issuers each year. As of December 31, 2016, 30 issuers had used the exemption to raise $247.6 million. While the majority of issuers that used the exemption were venture issuers, the exemption was also used by issuers listed on the TSX – 23 venture issuers used the exemption as compared to seven TSX-listed issuers. Additionally, the time to conduct a rights offering has been reduced significantly, taking on average 38 days from filing to closing. The CSA found that while the 30 offerings met the requirements of the exemption, there were a number of areas where compliance and disclosure could be improved: - stand-by commitments – the CSA noted a weakness in the disclosure regarding the relationship between the issuer and the stand-by guarantors; - use of available funds – CSA noted reoccurring deficiencies in the disclosure where available funds are insufficient to cover short-term liquidity requirements and overhead expenses; and - closing news release – the CSA noted that issuers did not always include the required information. CSA Staff Notice 45-323 is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170420_45-323_prospectus.htm) from the websites of participating jurisdictions. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Seeking Input on Proposed Conduct Rules for Derivatives Dealers and Advisors](https://baxsecuritieslaw.com/canadian-securities-regulators-seeking-input-proposed-conduct-rules-derivatives-dealers-advisors-april-7-2017-2/) **Published:** September 27, 2017 **Author:** Barbara Hendrickson **Excerpt:** On April 4, 2017, the Canadian Securities Administrators (CSA) published for comment Proposed National Instrument 93-101 Derivatives: Business Conduct (“Proposed Instrument”) and a related proposed companion policy, 93-101 Derivatives: Business Conduct (“Proposed CP”). The comment period will last 150 days, closing on September 1, 2017, during... **Content:** On April 4, 2017, the Canadian Securities Administrators (CSA) published for comment Proposed National Instrument 93-101 *Derivatives: Business Conduct* (“Proposed Instrument”) and a related proposed companion policy, 93-101 Derivatives: Business Conduct (“Proposed CP”)*.* The comment period will last 150 days, closing on September 1, 2017, during which the CSA is inviting specific feedback from stakeholders. The goal of the proposed Instrument and CP is to protect investors, improve transparency and accountability, and protect against market abuse. The proposed Instrument establishes an investor protection regime for over-the-counter (OTC) derivatives markets that is consistent with international standards and foreign requirements and is intended to create a uniform approach to derivatives business conduct regulation in Canada. It sets out fundamental obligations for OTC derivatives dealers and advisers. These include: - a fair dealing model suitable for derivatives markets that contains obligations to identify and respond to conflicts of interest; - know-your-derivatives party obligations; and, - compliance and recordkeeping requirements. For derivatives dealers and advisers working with non-institutional counterparties, the proposed instrument introduces further measures such as a derivatives-specific suitability standard, the requirement to identify derivatives party-specific needs, and disclosure regarding leverage. While noting that a “significant proportion” of OTC derivatives trading is cross-border, the proposed Instrument includes exemptions for foreign derivatives dealers and advisers that are subject to and comply with comparable laws of certain foreign jurisdictions. The CSA is also in the process of developing a registration regime for derivatives dealers and advisers. The CSA anticipates publishing proposed NI 93-102 *Derivatives: Registration* shortly. The CSA recommends that stakeholders consider the proposed registration regime in conjunction with the proposed Instrument and CP. The proposed National Instrument 93-101 *Derivatives: Business Conduct* and the proposed Companion Policy, 93-101 *Derivatives: Business Conduct*, are [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170404_93-101_rfc-derivatives.htm) from the websites of CSA members. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/09/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Mortgage Investment Corporations](https://baxsecuritieslaw.com/mortgage-investment-corporations-april-30-2017-2/) **Published:** September 27, 2017 **Author:** Barbara Hendrickson **Excerpt:** Introduction Mortgage investment corporations (“MICs”) are created under section 130.1 of the Income Tax Act which sets out the rules that apply to mortgage investment corporations and their shareholders. MICs primarily invest in mortgages including commercial, industrial, developmental and residential mortgages and are designed to... **Content:** **Introduction** Mortgage investment corporations (“MICs”) are created under section 130.1 of the *Income Tax Act* which sets out the rules that apply to mortgage investment corporations and their shareholders. MICs primarily invest in mortgages including commercial, industrial, developmental and residential mortgages and are designed to flow through income from those investments onto investors without being taxed at the corporate level. **Tax Treatment** A MIC must distribute 100% of its net annual income before taxes to shareholders in the form of dividends. MICs are entitled to deduct from its income all taxable dividends, other than capital gains dividends, paid by the MIC during the year or within 90 days of the year end and 50% of all capital gains dividends during the period commencing 90 days after the start of the year and ending 90 days after the end of the year. A MIC is deemed to be a public corporation for the purposes of the *Income Tax Act*. Investment in a MIC may be eligible for investment in registered products such as RRSPs, RRIFs, DPSPs, or RESPs and TFSAs. Dividends paid to shareholders, other than as a capital gains dividend, are deemed treated as interest payable on a bond. Where a dividend is paid as a capital gains dividend this amount is not included in the shareholder’s income but rather is deemed to be a capital gain. **Management of the MIC** MICs are managed by mortgage brokerage firms which are provincially registered under the *Mortgage Brokers, Lenders and Administrators Act*, pursuant to management agreements which set out the duties and obligations of the manager as well as annual and performance fees. The manager is responsible investing the MICs funds in suitable mortgages and administering the mortgages. Some MICs have a Credit Review Committee comprised of the manager and shareholders whose responsibility it is to review and approve mortgages to be added to the MIC’s portfolio. **Income Tax Act Requirements** A corporation will be a MIC under the section 130.1 of the Income Tax Act if throughout a taxation year: It is a “Canadian corporation” (incorporated in Canada and a resident of Canada). Its only undertaking is the investing of funds of the corporation and it does not manage or develop real or immoveable property. None of its property consists of: a. debts secured by real or immoveable property situated outside of Canada; b. debts owing to the MIC by non-resident persons (except any such debts secured on real or immoveable property situated in Canada); c. shares of corporations not resident in Canada; d. real or immoveable property situated outside of Canada or any leasehold interest in such property; There are 20 or more shareholders of the corporation and no investor is a “specified shareholder” of the corporation during the year. “Specified shareholders” are those who alone or together with related persons hold more than 25% of the issuers shares of a class of the MIC’s share capital. Preferred shareholders must have the right after payment to them of their preferred dividends and the payment of like dividends to the common shareholders, to participate pari passu with the common shareholders in any further payment of dividends paid to the common shareholders. The cost amount to the corporation of such property consisting of debts owing to the corporation that were secured by mortgages on houses (as defined in section 2 of the National Housing Act or on housing including within a “housing project” under that Act) and the amounts of any deposits with a bank or credit union or entity insured by CDIC or Quebec equivalent must be at least 50% of the cost amount of all of its property. The cost amount of all real or immoveable property including leasehold interests on such property (except property acquired by foreclosure or otherwise after a default) must not exceed 25% of the cost amount of all of its assets. The liabilities of the corporation cannot exceed three times the amount by which the cost amount of all of it properties exceeded its liabilities where at any time during the year the cost amount of its mortgages on residential property and its deposits with a bank or company was less than two thirds of the costs amounts of all of its properties. Otherwise liabilities of the MIC must not exceed five times the amount by which the cost amount to all of its properties exceeded it liabilities. **Securities Act Requirements** Investments in MICs whether through common or preferred equity are subject to securities regulation including the requirement to sell MIC securities under a prospectus or an exemption from the prospectus requirement and the requirement to comply with the dealer, advisor and investment manager registration requirements. The following guidelines are set out in CSA Guidance Staff Notice 31-323: Generally, mortgage investment entities (“MIEs”) which manage a portfolio of mortgages (“Pooled MIEs”) are only subject the investment fund manager registration if they are considered to be an “investment fund” as that term is defined under securities laws. If a Pooled MIE is an investment fund then it must ensure that the person or company that directs its business, operations or affairs is registered as an investment fund manager. A person or company that advises a Pooled MIE about buying or selling mortgages or other securities will be subject to the adviser registration requirement if it is in the business of advising in securities. The securities commissions will consider an exemption from the proficiency requirement for these individuals. A Pooled MIE will be subject to the dealer registration requirement if it is in the business of trading in securities as outlined in section 1.3 of 31-103CP. BAX Securities Law can assist with the creation and administration of a mortgage investment corporation. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/09/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [CSA Consultation Paper 51-404 Considerations for Reducing Regulatory Burden for Non-Investment Fund Reporting Issuers, May 11, 2017](https://baxsecuritieslaw.com/csa-consultation-paper-51-404-considerations-reducing-regulatory-burden-non-investment-fund-reporting-issuers-may-11-2017/) **Published:** May 12, 2017 **Author:** Barbara Hendrickson **Excerpt:** On April 6, 2017 the Canadian Securities Administrators (“CSA”) released CSA Consultation Paper 51-404 Considerations for Reducing Regulatory Burden for Non-Investment Fund Reporting Issuers. The goal of the paper is to identify and consider areas of securities legislation applicable to non-investment fund reporting issuers that... **Content:** On April 6, 2017 the Canadian Securities Administrators (“CSA”) released *CSA Consultation Paper 51-404 Considerations for Reducing Regulatory Burden for Non-Investment Fund Reporting Issuers*. The goal of the paper is to identify and consider areas of securities legislation applicable to non-investment fund reporting issuers that could benefit from a reduction of undue regulatory burden, without compromising investor protection or the efficiency of the capital market. The CSA has raised a number of possible areas of reform to “support” public companies and to reduce regulatory burdens. **2.1 Extending the application of streamlined rules to smaller reporting issuers** The CSA is considering reducing reporting requirements for smaller reporting issuers based on a different metric other than venture / non venture exchange issuer, such as a size-based distinction (for example, by the size of its assets, revenue, market capitalization or a combination of criteria). These streamlined reporting requirements would include longer filing deadlines for annual and interim financial statements, a higher threshold for significant acquisition reporting, no requirement to file an annual information form (**AIF**), ability to file a quarterly highlights document to meet interim management’s discussion and analysis (**MD&A**) requirements, different corporate governance requirements and reduced certification requirements. **2.2 Reducing the regulatory burdens associated with the prospectus rules and offering process** **(a) Reducing the audited financial statement requirements in an IPO prospectus** The CSA is considering allowing issuers that intend to list on a Non-Venture Exchange to present a reduced number of years of audited financial statements (three to two years) in their IPO prospectus if they have pre-IPO revenues under a certain threshold. Alternatively, the CSA is considering allowing all issuers to do so. **(b) Streamlining other prospectus requirements** The CSA is considering removing or modifying other prospectus requirements to reduce the issuer’s preparation costs including increasing BAR thresholds for non-venture issuers, removing the requirement for interim financial statements to be reviewed by an auditor, removing the requirement to include pro forma financial statements for significant acquisitions; and tailoring disclosure requirements for non-IPO prospectuses to focus on: the issuer’s business, the issuer’s management, conflicts of interest, securities distributed, and risks. **(c) Streamlining public offerings for reporting issuers** *(i) Short form prospectus offering system* The CSA is considering eliminating or modifying existing short form prospectus disclosure requirements where such requirements are duplicative, are not providing potential investors with timely, relevant information or may be misaligned with current market practices (for example, risk factor disclosure and the required disclosure of price ranges and trading volumes). The CSA is also considering extending the short form prospectus offering system to additional reporting issuers not currently qualified to use it. *(ii) Potential alternative prospectus model* The CSA is considering limiting the disclosure in a prospectus to relevant items concerning the offering and the offered securities, such as a detailed description of the securities offered, intended use of proceeds, the plan of distribution, consolidated capitalization, earnings coverage, material risk factors associated with the offering and the offered securities, conflicts of interest and investors’ statutory rights of withdrawal, damages and rescission. *(iii) Facilitating at-the-market (ATM) offerings* The CSA is considering whether some of the current restrictions on ATM offerings could be relaxed or eliminated. An ATM offering is a continuous distribution by a reporting issuer of equity securities into a public trading market, such as the TSX, at prevailing market prices. Currently, a reporting issuer wishing to conduct an ATM offering must obtain exemptive relief from the appropriate regulatory authority and onerous conditions are imposed including limiting the number of securities that may be sold on any given trading day (as a percentage of the aggregate daily trading volume) and requiring monthly reports in respect of sales made through the ATM offering. **(d) Other potential areas** The CSA is also considering other areas for reducing regulatory burden associated with capital raising, including facilitating cross-border offerings and further liberalizing the pre-marketing and marketing regime. **2.3 Reducing ongoing disclosure requirements** **(a) Removing or modifying the criteria to file a Business Acquisition Report (“BAR”)** The CSA is considering changes to the BAR requirements such as removing the requirement to file a BAR entirely in certain circumstances, removing one or more of the significance tests, increasing the threshold applied to the three significance tests for non-venture issuers and providing alternative tests based on specific industry criteria. **(b) Reducing disclosure requirements in annual and interim filings** The CSA is considering ways to refocus annual and interim filings including removing the discussion of prior period results from the MD&A, removing the summary of quarterly results for the eight most recently completed quarters in the MD&A and allowing all reporting issuers to meet interim MD&A requirements by preparing a “quarterly highlights” document **(c) Permitting semi-annual reporting** The CSA is considering providing reporting issuers the option to report on either a quarterly or semi-annual basis to all reporting issuers, or limit this option to smaller reporting issuers. **2.4 Eliminating overlap in regulatory requirements** The CSA is considering the removal of some or all of the overlap in the disclosure requirements of IFRS and Form 51-102F1 *Management’s Discussion & Analysis* in the following areas: financial instrument, critical accounting estimates, change in accounting policies and contractual obligations. **2.5 Enhancing electronic delivery of documents** Finally, the CSA is considering whether new methods of electronic delivery should be permitted to further reduce the use of paper to fulfill delivery requirements under the “notice and access method”. Submissions on the above proposals are due by July 7, 2017. CSA Consultation Paper 51-404 is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170405_51-404_considerations-for-reducing-regulatory-burden.htm) from the websites of participating jurisdictions. 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. **Categories:** News & Updates --- ### [CSA Staff Notice 33-319: Status Report on CSA Consultation Paper 33-404 Proposals to Enhance the Obligations of Advisers, Dealers, and Representatives Toward Their Clients](https://baxsecuritieslaw.com/csa-staff-notice-33-319-status-report-csa-consultation-paper-33-404-proposals-enhance-obligations-advisers-dealers-representatives-toward-clients/) **Published:** May 29, 2017 **Author:** Barbara Hendrickson **Excerpt:** On May 21, 2017 the Canadian Securities Administrators (“CSA”) released CSA Staff Notice 33-319  Status Report on CSA Consultation Paper 33-404 Proposals to Enhance the Obligations of Advisers, Dealers, and Representatives Toward Their Clients (“Staff Notice”). The goal of the Staff Notice was to provide... **Content:** On May 21, 2017 the Canadian Securities Administrators (“CSA”) released *CSA Staff Notice 33-319* *Status Report on CSA Consultation Paper 33-404 Proposals to Enhance the Obligations of Advisers, Dealers, and Representatives Toward Their Clients* (“Staff Notice”). The goal of the Staff Notice was to provide an update of the consultation process on the Consultation Paper. The Consultation Paper sought comment on proposed regulatory action designed to enhance the obligations of registrants towards their clients. The Consultation Paper dealt covered two general areas of reform: - a proposed set of regulatory amendments to *National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103*) and potential guidance (“Targeted Reforms”); and, - a proposed regulatory best interest standard, accompanied by guidance, that would serve as an overarching standard and governing principle for all other client-related obligations (“Regulatory Best Interest Standard”). Targeted Reforms: The Consultation Paper proposed a set of Targeted Reforms to NI 31-103 and potential guidance that increases the obligations of all registrants, including advisers, dealers and representatives, IIROC and MFDA members. This includes the following areas: - Conflicts of interest - Know Your Client (KYC) - Know Your Product (KYP) - Suitability - Relationship disclosure - Proficiency - Titles - Designations - Role of the Ultimate Designated Person (UDP) and the Chief Compliance Officer (CCO), and; - Statutory fiduciary duty when client grants discretionary authority. The CSA has considered the feedback received from stakeholders regarding the targeted reforms outlined in the Consultation Paper. It remains committed to addressing the issues identified in the client-registrant relationship and raising the bar on what is required of registrants. This includes better aligning the interests of registrants with the interests of their clients, improving outcomes for clients and clarifying the nature of the client-registrant relationship. To achieve these outcomes, the CSA will reconsider some of the proposed targeted reforms, including: - the mandatory collection of basic tax information that was proposed as part of the KYC reforms; - the element of the KYP proposal that would require the market investigation of a reasonable universe of products, and the differentiation of KYP requirements based on whether a firm is proprietary or mixed / non-proprietary in terms of its product offering; - considering adding an element of reasonableness or other modification to the requirement for representatives to understand and consider the structure, product strategy, features, costs, and risks of each security on their firm’s product list; and, - the default requirement to perform a suitability assessment at least once every 12 months absent a triggering event, and the requirement to perform a suitability assessment if there is a significant market event affecting capital markets to which the client is exposed. The CSA will also reconsider certain wording expressed in some of the proposed targeted reforms in light of comments received, as well as looking for ways to address concerns about a one-size-fits-all approach by incorporating the concept of scalability, where appropriate. It will also consider changes to refine or eliminate a number of the number of elements of the deemed prescriptive by some stakeholders. **Regulatory Best Interest Standard:** The Consultation Paper also set out a Best Interest Standard which was designed to: - act in the best interest of the client; - avoid or control conflicts of interest in a manner that prioritizes the client’s best interests provide full, clear, meaningful and timely disclosure; - interpret law and agreements with clients in a manner favourable to the client’s interest where reasonably conflicting interpretations arise; and - act with care. While the revised set of Targeted Reforms received unanimous support, only the securities regulators of Ontario (OSC) and New Brunswick (FCNB) supported the proposed regulatory best interest standard and will pursue it on a parallel path. The securities regulators of British Columbia (BCSC), Alberta (ASC), Manitoba (MSC) and Quebec (AMF) have rejected outright the proposed standards; those of Nova Scotia (NSSC) and Saskatchewan (FCAA) are taking a wait-and-see approach to see the results of Ontario and New Brunswick’s work. **Next Steps:** In response to the feedback, the CSA will prepare a revised set of Targeted Reforms to NI 31-103 as well as draft guidance over the 2017-2018 fiscal year. The CSA has identified certain reforms that should be given higher priority in the next phase of work. Proposed amendments in the following areas will be prioritized as they are fundamental to addressing the issues identified in the Consultation Paper: - Conflicts of interest - Suitability - Know Your Client - Know Your Product - Relationship disclosure - Titles and designations The revised rule proposals will be published for comment, providing further opportunity for meaningful input from stakeholders. As noted, work on the Regulatory Best Interest Standards will continue by the regulators in those jurisdictions who have expressed an interest in it, albeit on a parallel track. CSA Staff Notice 33-319 is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170511_33-319_proposals-enhance-obligations-advisers.htm) from the websites of participating jurisdictions. 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. **Categories:** News & Updates --- ### [CSA Staff Notice 31-350 - Guidance on Small Firms Compliance and Regulatory Obligations, June 6, 2017](https://baxsecuritieslaw.com/csa-staff-notice-31-350-guidance-small-firms-compliance-regulatory-obligations-june-6-2017/) **Published:** June 9, 2017 **Author:** Barbara Hendrickson **Excerpt:** On May 18, 2017, the Canadian Securities Administrators (“CSA”) released CSA Staff Notice 31-350 Guidance on Small Firms Compliance and Regulatory Obligations (“Staff Notice”). The Staff Notice was the result of a two-year compliance review of 65 small firms, lasting from October 2014 to June... **Content:** On May 18, 2017, the Canadian Securities Administrators (“CSA”) released *CSA Staff Notice 31-350* *Guidance on Small Firms Compliance and Regulatory Obligations* (“Staff Notice”). The Staff Notice was the result of a two-year compliance review of 65 small firms, lasting from October 2014 to June 2016. The individual firms’ compliance was measured against the applicable securities legislation, including *National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103*) and its Companion Policy *(31-103CP).* The small firms fell into one or more of the following categories: investment fund managers (“IFM”), portfolio managers (“PM”) and exempt market dealers (“EMD”). The firms selected were primarily sole proprietorships or firms with one registered individual (i.e., one individual who was registered in a category that authorizes the individual to act as a dealer or an adviser on behalf of the registered firm, or in the case of an IFM, one individual registered as the chief compliance officer (“CCO”)). The CSA’s review uncovered widespread deficiencies, including inadequate or missing business continuity plans (“BCPs”) (35% of firms), inadequate monitoring systems (71% with inadequate written policies), unfulfilled regulatory filing obligations (34%), non-compliant client statements (45%) and inadequate relationship disclosure materials (63%). **Business Continuity Planning** The CSA provided guidance focusing on managing risks related to business interruption and continuity, both which raise significant issues for many small firms. It noted that many of these firms need to: - develop a BCP that is appropriate for their size and business model, - designate an individual to execute the BCP (BCP executor); and, - review their BCP annually. The CSA found that small firms with only one individual and no support or administration staff may have to designate an individual external to the firm such as a spouse or legal counsel to act as BCP executor. The CSA may grant exemptive relief should the BCP executor be acting for more than one registered firm. When working with an external BCP executor, the CSA advises, depending on the firm’s business model: - a written agreement is in place so that the BCP executor understands his or her responsibilities; - the BCP executor is familiar with the firm’s BCP and is familiar with the firm’s business to properly wind down or temporarily manage it or facilitate the transfer of client accounts; - a confidentiality agreement is in place if the BCP executor would have access to confidential client information and that the firm has properly pre-arranged client authorization to share this confidential information (e.g., in the relationship disclosure information documentation); - if the BCP executor is another registrant, conflicts of interest between both firms have been considered (e.g., an external BCP executor could be managing clients of two firms in a scenario of temporary absence); and, - the BCP executor understands securities legislation and is aware of costs (e.g., costs related to filing an application for exemptive relief). The CSA stressed the importance of spelling out in the BCPs the importance of the business’ succession or wind-down procedures in the event of death, incapacitation or prolonged temporary absence of the sole registered individual and who is responsible for notifying the regulators. The CSA also noted, that where applicable, small firms should also have procedures to mitigate and recover from business interruptions, including how the firm will communicate with clients, key personnel, third-party service providers, and regulators (e.g., provide an alternate means of communication, and procedures to protect, backup and recover the firm’s books and records (e.g., as a result of a cyber-security incident or natural disaster). **Monitoring Systems:** While the CSA also observed that many small firms may not have the resources to make segregation duties possible, it cautioned that all firms must maintain records to accurately record business activities, financial affairs, and client transactions, and demonstrate the extent of a firm’s compliance with applicable requirements of securities legislation. The CSA also warned that firms must establish, maintain and apply policies and procedures that establish a system of controls and supervision in order to: - provide reasonable assurance that the firm and each individual acting on its behalf comply with securities legislation; and, - manage the risks associated with its business in accordance with prudent business practices. **Other Guidance:** The Staff Notice also provided guidance on these additional areas of concern: - **CCO Annual Reports** – CSA Staff stress that it is important that a small firm’s CCO must assess the firm’s compliance structure on at least an annual basis. If no report has been filed, the CSA notes that questions may arise regarding the adequacy of the firm’s compliance system and how well it has complied with securities legislation and whether the CCO is adequately performing his or her responsibilities. CSA staff note that a small firm’s CCO can readily meet this reporting requirement by documenting this assessment in the firm’s board of directors’ minutes. - **Accounting Deficiencies:** CSA staff found that some of the reviewed small firms were deficient in their accounting practices, applying the cash basis accounting method instead of the accrual basis accounting method. For example, firms were not accruing revenues as they were earned; instead, they were waiting for when cash was received to recognize revenues. The CSA urges that small firms should review the guidance provided in: - sections 12.10 to 12.11 of NI 31-103CP - section 2.7 of the *Companion Policy to National Instrument 52-107 Acceptable Accounting Principles and Auditing Standards.* - **Inadequate Excess Working Capital:** The CSA staff review found that some firms had improperly completed *Form 31-103F1 Calculation of Excess Working Capital*. Probing further, CSA staff found some of the reviewed firms had inadequate excess working capital during the period covered by the compliance review. The review also found that many forms were improperly completed. Guidance on how to properly complete the Form is provided in sections 12.1 and 12.2 of NI 31-103 CP. The CSA also cautioned that firms should include procedures for when and if a working capital deficiency should occur, indicating who is responsible for rectifying the deficiency and how the deficiency would be reported to the applicable regulator as soon as possible. In closing, the CSA notes that it will continue to monitor small firm compliance. CSA Staff Notice 31-350 is [available for download](https://www.osc.gov.on.ca/documents/en/Securities-Category3/csa_20170517_31-350_guidance-on-small-firms.pdf) from the websites of participating jurisdictions. 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. **Categories:** News & Updates --- ### [OSC Staff Notice 45-715, 2017 Ontario Exempt Market Report](https://baxsecuritieslaw.com/osc-staff-notice-45-715-2017-ontario-exempt-market-report-june-22-2017/) **Published:** June 30, 2017 **Author:** Barbara Hendrickson **Excerpt:** On June 15, 2017, the Ontario Securities Commission (“OSC”) released OSC Staff Notice 45-715, 2017 Ontario Exempt Market Report (“Report”) which summarizes capital raising activity in 2015 and 2016 by corporate (non-investment fund) issuers in Ontario’s exempt market. The Report also examines the impact of... **Content:** On June 15, 2017, the Ontario Securities Commission (“OSC”) released *OSC Staff Notice 45-715, 2017 Ontario Exempt Market Report* (“Report”) which summarizes capital raising activity in 2015 and 2016 by corporate (non-investment fund) issuers in Ontario’s exempt market. The Report also examines the impact of recently introduced prospectus exemptions which were designed to facilitate capital raising for small and medium-sized enterprises (“SMEs”). The recently introduced prospectus exemptions include: - Existing security holder exemption – February 11, 2015 - Family, friends and business associates exemption – May 5, 2015 - Offering memorandum exemption – January 13, 2016 - Crowdfunding exemption – January 25, 2016 **Highlights** In 2016, Ontario residents invested approximately $72 billion in over 2,500 non-investment fund issuers through prospectus-exempt offerings. Canadian issuers accounted for only 37% ($27 billion) of the capital raised in Ontario, but represented almost two-thirds of issuers (approximately 1,600 issuers) participating in Ontario’s exempt market in 2016. The key findings highlighted in the report include: - Approximately 57% of Canadian issuers participating in Ontario’s exempt market were small issuers, defined as issuers raising less than $1 million annually. Notwithstanding the large number of small issuers, they only accounted for less than 1% of annual gross proceeds raised by Canadian issuers. - In 2016, the number of small Canadian issuers and the gross proceeds raised by these issuers rose significantly, by 30% and 40%, respectively. This increased activity was concentrated among small Canadian issuers in three main industries: natural resources, consumer goods and services, and real estate and mortgage finance. - The Report found that since the new prospectus exemptions were introduced starting in 2015, they have been supported by a significant amount – 25% – of Canadian issuers. In 2016, approximately 400 issuers relied on the new prospectus exemptions to raise approximately $133 million, with close to half of these issuers raising capital in Ontario for the first time since 2014. - Natural resource issuers were the largest issuers relying on the prospectus exemptions Among issuers relying on the new prospectus exemptions at 37%, while real estate and mortgage finance issuers accounted for most capital raised at 70%. - Accredited investors, mainly institutional investors, contributed over 90% of the total capital invested in the Ontario exempt market. However, most of the capital was invested in large issuers, primarily foreign-based and consisting of financial entities such as banks, private equity funds, and asset-backed structured finance vehicles. - Within the context of the broader Canadian capital market, Ontario’s exempt market accounted for less than one-fifth of the total gross proceeds raised by Canadian issuers domestically and less than one-tenth of gross proceeds raised globally. OSC Staff Notice 45-715 2017 is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20170615_45-715_exempt-market.htm) from the website of the Ontario Securities Commission. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/08/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [CSA Staff Notice 33-320, The Requirement for True and Complete Applications for Registration, August 2, 2017](https://baxsecuritieslaw.com/csa-staff-notice-33-320-requirement-true-complete-applications-registration-august-2-2017/) **Published:** August 3, 2017 **Author:** Barbara Hendrickson **Excerpt:** On July 13, 2017, the Canadian Securities Administrators (“CSA”) published CSA Staff Notice CSA 33-320, The Requirement for True and Complete Applications for Registration to state its concern to stakeholders regarding what it calls the “serious problem” of applications for registration that contain false or... **Content:** On July 13, 2017, the Canadian Securities Administrators (“CSA”) published CSA Staff Notice CSA 33-320, *The Requirement for True and Complete Applications for Registration* to state its concern to stakeholders regarding what it calls the “serious problem” of applications for registration that contain false or misleading statements, and to warn of the consequences of submitting such applications. **Background:** The registration application process is governed by National Instrument 33-109 Registration Information (“NI 33-109”) and National Instrument 31-103 Registration Requirements, Exemptions, and Ongoing Registrant Obligations (“NI 31-103”). NI 33-109 requires, among other things, that applications for individual registration be submitted through the National Registration Database using a Form 33-109F4 Registration of Individuals and Review of Permitted Individuals (Form F4). Registration applications, notes CSA staff, may be false or misleading when it includes information that is untrue, omits relevant information, provides vague information, or mischaracterizes information. In addition, applications may be false or misleading because of things said (or not said) on the application form, or in information and materials provided in connection with the application, such as correspondence from the applicant or statements made during interviews with CSA staff. The CSA warns that explanations based on carelessness or misunderstanding are not acceptable. There is an onus on registrants, according to the CSA staff notice, to provide continuous disclosure to the OSC or other applicable securities regulator. If any of the information provided on an individual’s Form F4 changes, the registrant is required to update the information via a Form 33-109F5 Change of Registration Information within the time period provided for in NI 33-109. Failure to disclose in a timely fashion not only is a breach of securities legislation, warns CSA staff, but also may affect the individual’s suitability for registration. CSA staff points out that section 5.1(1) of NI 33-109, requires the sponsoring firm to make “reasonable efforts” to ensure that the information in the registration is accurate. The notice clarifies that because Form F4 is intended to foster investor protection, applicants should always err on the side of disclosure, following the “golden rules” for registration applications: - read the application form carefully; and - complete the application form truthfully and with candor. CSA staff strongly warned against any “novel, aggressive, or otherwise self-serving interpretations.” CSA Staff Notice 33-320 is [available for download](https://bcsc.bc.ca/Securities_Law/Policies/Policy3/PDF/33-320__CSA_Staff_Notice___July_13__2017/) from the websites of the participating jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/08/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Barbara Hendrickson quoted in Law Times article Focus: Social media use should comply with securities law, August 14, 2017](https://baxsecuritieslaw.com/barbara-hendrickson-quoted-law-times-article-focus-social-media-use-comply-securities-law-august-14-2017/) **Published:** August 16, 2017 **Author:** Barbara Hendrickson **Excerpt:** To access the featured article, click here. **Content:** To access the featured article, [click here.](http://www.lawtimesnews.com/201708146351/focus-on/focus-social-media-use-should-comply-with-securities-law) ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/08/Barb-bar-01.jpg) **Categories:** News & Updates --- ### [CSA Multilateral Staff Notice 61-302 Staff Review and Commentary on Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions.](https://baxsecuritieslaw.com/csa-multilateral-staff-notice-61-302-staff-review-commentary-multilateral-instrument-61-101-protection-minority-security-holders-special-transactions/) **Published:** August 19, 2017 **Author:** Barbara Hendrickson **Excerpt:** On July 29, 2017, the securities regulatory authorities in Ontario, Québec, Alberta, Manitoba and New Brunswick (the participating jurisdictions) published CSA Multilateral Staff Notice 61-302 Staff Review and Commentary on Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (the Notice”). The notice outlines the... **Content:** On July 29, 2017, the securities regulatory authorities in Ontario, Québec, Alberta, Manitoba and New Brunswick (the participating jurisdictions) published [CSA Multilateral Staff Notice 61-302 *Staff Review and Commentary on Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions*](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170727_61-302_sn-staff-review.htm) *(the Notice”).* The notice outlines the approach used by the participating jurisdictions to review material conflict of interest transactions, including insider bids, issuer bids, business combinations and related party transactions that give rise to concerns regarding the protection of minority security holders. The notice also advises market participants of the participating jurisdictions’ views on special committees of independent directors and enhanced disclosure requirements. The notice describes how staff review conflict of interest transactions to assess compliance with Multilateral Instrument 61-101 *Protection of Minority Security Holders in Special Transactions* (“MI 61-101”), including the timing and scope of such reviews, the information-gathering process and potential remedies in the event of non-compliance. The Notice also contains a discussion of staff’s views on special committees of independent directors and enhanced disclosure requirements based on the requirements of MI 61-101 and associated guidance, decisions of securities regulatory authorities, and issues identified in reviews of “material conflict of interest transactions”. The Notice addresses the role of boards of directors and/or special committees of independent directors in negotiating, reviewing, and approving or recommending material conflict of interest transactions, and disclosure obligations that enable security holders to make informed decisions to vote or tender in favour of proposed material conflict of interest transactions. “Material conflict of interest transaction” refers to insider bids, issuer bids, business combinations and related party transactions, each as defined in MI 61-101 and generally does not include transactions that are captured incidentally within the scope of MI 61-101, such as transactions that are business combinations only as a result of employment-related collateral benefits. The term “minority security holder” refers to equity security holders of a reporting issuer that are not an “interested party” (as such term is defined in MI 61-101) in connection with the material conflict of interest transaction. The Notice states that Staff will review material conflict of interest transactions on a real-time basis to assess compliance with the requirements of MI 61- 101 and to determine whether a transaction raises potential public interest concerns. Staff will generally initiate a review of a material conflict of interest transaction upon the filing of a disclosure document for the transaction. Reviews focus on compliance with disclosure requirements, compliance with the conditions for exemptions in MI 61-101 from the formal valuation and minority approval requirements, and the substance and disclosure of the process conducted by an issuer’s board of directors or special committee in considering a material conflict of interest transaction plus any complaints received by Staff. The Notice, consistent with the guidance found in ss. 6.1(6) of 61-101, states that a special committee is advisable for all material conflict of interest transactions. The Notice warns against special committees formed after a proposed transaction had been substantially negotiated or where the special committee is passive and fails to conduct a robust review of the circumstances leading to the transaction, alternatives to the transaction that were available in the circumstances, and the transaction itself. According to the Notice an effective special committee process in the context of a “material conflict of interest transaction” generally includes a robust mandate, the engagement by the committee of independent advisors, supervision over or direct conduct of negotiations, accurate record keeping, and non- coercive conduct on the part of interested parties. The Notice states that the special committee should be able to hire its own independent legal and financial advisors and that where the special committee has not been involved in preliminary negotiations, the board of directors and special committee should not be bound by any such negotiations. The Notice also discusses the requirement of fairness opinions to be obtained by special committees and boards of directors from financial advisors in connection with material transactions. In addition to requirements under MI 61-101 to obtain a formal valuation, the Notice states that it is the responsibility of the board and special committee to determine whether a fairness opinion is necessary to assist in making a recommendation to security holders on a proposed transaction. Staff believe that it is generally the responsibility of the board of directors and the special committee to determine the terms and financial arrangements for the engagement of an advisor to provide a fairness opinion. disclosure concerning fairness opinions should provide security holders with a meaningful understanding of the fairness opinion and how it was considered by the board or special committee. The Notice also discussing appropriate disclosure in the context of a material conflict of interest transaction”. The Notice states that the disclosure in the context of a material conflict of interest transaction requires a thorough discussion of the review and approval process; the reasoning and analysis of the board of directors and/or special committee, the views of the board of directors and/or special committee as to the desirability or fairness of the transaction, reasonably available alternatives to the transaction, including the status quo, and the pros and cons of the transaction. Multilateral CSA Staff Notice 61-302 is available [CSA Multilateral Staff Notice 61-302 *Staff Review and Commentary on Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions*](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170727_61-302_sn-staff-review.htm) *(the Notice”) t*he website of the Ontario Securities Commission. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/08/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Ontario Securities Commission releases decision on the Sino-Forest Corporation](https://baxsecuritieslaw.com/ontario-securities-commission-releases-decision-sino-forest-corporation/) **Published:** August 28, 2017 **Author:** Barbara Hendrickson **Excerpt:** On July 14, 2017 the Ontario Securities Commission (“OSC”) published its 278-page decision respecting Sino-Forest.  The panel found that the respondents, former CEO Allan Chan and three other executives of Sino-Forest Corporation – Alfred Hung, George Ho and Albert Ip breached Ontario securities laws.  Allen... **Content:** On July 14, 2017 the Ontario Securities Commission (“OSC”) published its 278-page decision respecting Sino-Forest. The panel found that the respondents, former CEO Allan Chan and three other executives of Sino-Forest Corporation – Alfred Hung, George Ho and Albert Ip breached Ontario securities laws. Allen Chan was a co-founder of Sino-Forest and Chairman of the Board and CEO of Sino-Forest. The OSC found that Chan, together with three other executives, committed fraud. The panel found that Simon Yeung misled OSC staff during the investigation but the other allegations against him were dismissed. The decision comes six years after short seller Muddy Waters first raised issues about Sino–Forest. Sino-Forest was a commercial forest plantation operator in the People’s Republic of China. Its principal businesses were described as the ownership and management of tree plantations, the sale of standing timber and wood logs, and the complementary manufacturing of downstream engineered-wood products. The majority of Sino-Forest’s business was in standing timber. Following the release of the Muddy Waters Report, Sino-Forest shares plummeted. The OSC issued a cease trade order in August 2011 and on May 9, 2012, the TSX delisted Sino-Forest’s shares. Between February 2003 and October 2010, Sino-Forest raised approximately US $3.0 billion from investors by issuing debt and equity securities. By March 31, 2011, Sino-Forest’s market capitalization was over C$6 billion. On June 2, 2011, Muddy Waters, LLC, a short-seller with a short position in Sino-Forest shares, released a report that alleged Sino-Forest was a “near total fraud” and a “Ponzi scheme”. The panel agreed and found that Sino-Forest and four of the five executives engaged in deceitful and dishonest conduct related to Sino-Forest’s standing timber assets and revenue that constituted fraud, contrary to subsection 126.1(b) of the *Securities Act*. The panel held that public disclosure regarding Sino-Forest’s ownership of assets and revenue recognition was misleading, untrue or did not state facts that were necessary to make the statements not misleading contrary to subsection 122(1)(b) of the *Securities Act*. The panel also found that four of the five executives misled the Commission during its investigation, contrary to subsection 122(1)(a) of the *Securities Act*. Sino-Forest’s deceitful disclosure included the following: (a) concealing key facts, (b) overstatement of assets and revenue, (c) creating documents to deceive CFO and auditors, (d) backdating of contracts post-quarter-end; (e) providing insufficient proof of ownership of assets, and (f) failing to identify the specific assets being acquired, such that the standing timber could be independently verified. According to the panel, the deceitful disclosure put the financial interests of its investors at risk. The OSC panel found that to establish the requisite intent of a corporation to commit fraud, it is sufficient to show its directing mind(s) knew or reasonably ought to have known the acts of the corporation perpetrated a fraud. Chan was the directing mind of Sino-Forest. The Panel found that Chan never disclosed any interests and conflicts of interest in several transactions with a non-arm’s length company to the Board of Directors of Sino-Forest, or the investors before, during or after the transactions and that the investors’ interests were put at risk by Chan’s failure to disclose his interests and conflicts of interest. According to the panel, investors need to be able to rely on the accuracy and truthfulness of the public disclosure documents of issuers so they can reliably base their investment decisions on this disclosure. In the absence of this required and truthful disclosure, Sino-Forest investors were unable to make informed investment decisions. As a result, their pecuniary interests were put at risk. The panel found therefore that Sino-Forest engaged in deceitful and dishonest conduct related to its standing timber assets and revenue that constituted fraud, contrary to subsection 126.1(b) of the *Securities Act*. The OSC panel found that Chan’s conduct did not meet the standard of a reasonably competent Chief Executive Officer acting in similar circumstances at the time. Chan was deeply involved in the day-to-day operations of Sino-Forest. It was Chan’s responsibility to ensure that Sino-Forest complied with Ontario securities law. The panel rejected expert testimony that the illegal conduct was not fraud but rather in accordance with the Chinese customary practice of “guanxi”, which was described as “drawing on connections in order to secure favours and reciprocal obligations, is based on intricate and pervasive relational networks”. They found that the evidence was something more than a cultural difference and stated that: “For the purpose of our analysis, Ontario securities law is paramount and overrides any explanation for illegal conduct being excusable in the name of “guanxi” however defined.” At the time of writing, a hearing to determine appropriate sanctions for the respondents is yet to be scheduled. The reasons of the OSC panel can be found at [http://www.osc.gov.on.ca/documents/en/Proceedings-RAD/rad\_20170713\_sino-forest.pdf](http://www.osc.gov.on.ca/documents/en/Proceedings-RAD/rad_20170713_sino-forest.pdf) on *t*he website of the Ontario Securities Commission. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/08/Barb-bar-01-1024x248.jpg)![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [CSA Staff Notice 46-307 Cryptocurrency Offerings](https://baxsecuritieslaw.com/csa-staff-notice-46-307-cryptocurrency-offerings/) **Published:** September 4, 2017 **Author:** Barbara Hendrickson **Excerpt:** On August 24, 2017, the Canadian Securities Administrators (“CSA”) published CSA Staff Notice 46-307 Cryptocurrency Offerings (“Notice”), to address the increasing number of cryptocurrency offerings, either through Initial Token Offerings (“ITOs”) or Initial Coin Offerings (“ICOs”) and sales of securities of cryptocurrency investment funds. A... **Content:** On August 24, 2017, the Canadian Securities Administrators (“**CSA**”) published CSA Staff Notice 46-307 *Cryptocurrency Offerings* (“**Notice**”), to address the increasing number of cryptocurrency offerings, either through Initial Token Offerings (“**ITOs**”) or Initial Coin Offerings (“**ICOs**”) and sales of securities of cryptocurrency investment funds. A cryptocurrency is a digital asset designed to work as a decentralized medium of exchange using cryptography to secure the transactions and to control the creation of additional units of the currency. The first cryptocurrency was Bitcoin, which emerged in 2009. Bitcoin and the other cryptocurrencies, such as Ethereum, that have come into use since then, use decentralized control, as opposed to a centralized electronic money or centralized banking systems. \[1\] The structures of ICOs/ITOs will vary, and they may be used to raise capital for a variety of projects, including the development of a new cryptocurrency, distributed ledger technology, service or platform. An ICO/ITO is typically open for a set period, during which investors can visit a website to purchase coins/tokens in exchange for fiat currency (US or Canadian dollars) or a cryptocurrency such as Bitcoin or Ethereum. ICOs/ ITOs are generally used by startup businesses to raise capital from retail investors through the internet. Anyone with internet access can create or invest in an ICO/ITO, in many cases, they can do so anonymously. The coins/tokens can be similar to traditional shares of a company because their value may increase or decrease depending on how successfully the business executes its business plan using the capital raised. Tokens and coins and other cryptocurrencies may be sold on online exchanges that allow investors to buy and sell the cryptocurrencies. Purchases and sales may be made using either fiat currencies (e.g. US or Canadian dollars) or cryptocurrencies (using another cryptocurrency such as Ethereum). The Notice is intended to help financial technology (fintech) businesses understand their obligations under securities laws. If the cryptocurrency offerings involve sales of “securities” and if the person or company selling the securities is conducting business from within Canada or if there are Canadian resident investors, Canadian securities laws will apply. According to the Notice, there are significant investor protection concerns related to these markets, due to the volatility, lack of transparency, lack of proper valuations, custodial concerns, and lack of liquidity and the fact that trading occurs on unregulated cryptocurrency exchanges. Investor protection concerns also arise because the ICO/ITO products are so complex and investors may not understand the properties of the investment products they are purchasing which may make them particularly vulnerable to being harmed by unethical practices or illegal schemes. The Notice warns that, in many instances, the coins/tokens constitute “securities” and or “derivatives” for the purposes of securities laws and are subject to regulation by securities commissions across Canada even though what is being sold is referred to as a “coin” or a “token” instead of a share, stock, or unit. A “coin” or “token” may still be a “security” as defined in securities legislation if the coin or token is similar to a traditional share in that the value of the coin or token increases or decreases depending on how successful the business in which the funds are invested executes its business plan with the capital that is raised. If the value of a token or a coin is tied to future profits or success of a business then they will likely be considered “securities” for the purpose of securities laws. If the tokens or coins in an ITO or ICO is found to be a “security” under applicable securities laws, the prospectus, registration and/or marketplace requirements apply to the cryptocurrency offerings. These requirements include: - Tokens and coins may only be sold after a receipt has been received from a securities regulatory authority for a comprehensive disclosure document called a “prospectus,” or pursuant to a private placement in reliance on a prospectus exemption such as to “accredited investors” or under the “offering memorandum exemption”; - Offering documents used in ICOs and ITOs must comply with securities laws and can trigger certain ongoing obligations and other protections for investors including providing investors with the right to sue for a misrepresentation and the right to withdraw from a transaction; - Filings of exempt distributions and offering documents must be made with the applicable securities commission where a prospectus exemption is relied upon; - Tokens and coins sold under a prospectus exemption are subject to restrictions on secondary trading; - Businesses and individuals in the business of “trading in” or “advising” on the tokens or coins must be properly registered and must meet fundamental obligations to investors, including know-your client (KYC) and suitability; and - Platforms that facilitate trades in coins/tokens that are “securities” may be a “marketplace” and need to comply with marketplace requirements regarding “exchanges” or “alternative trading systems”. The Notice also cautions that the offerings may also be “derivatives” under applicable securities rules and subject to the derivatives laws adopted by the Canadian securities commissions, including trade reporting rules. The Notice also discussed the emergence of cryptocurrency “investment funds”, as defined under securities laws set up to invest in Bitcoin and other cryptocurrencies. One of the key purposes of this type of investment fund is to provide investors with the opportunity to obtain exposure to cryptocurrencies, or baskets of cryptocurrencies, that they may not otherwise have. CSA staff actively encourage these fintech businesses seeking to establish a cryptocurrency investment fund to consider factors such as: - In certain jurisdictions in Canada, the OM prospectus exemptions cannot be used by investment funds; - The investment fund must do due diligence on the cryptocurrency exchanges that the fund uses to purchase or cell cryptocurrencies for its portfolios including ensuring compliance with anti-money laundering and counterterrorist financing laws; - Registration as a dealer, adviser and /or investment fund manager may be required; - Valuation of the cryptocurrencies in the investment funds portfolio should be carefully valued; and - Generally, the assets of an investment fund must be held by a custodian that meets certain prescribed requirements. The Notice encourages business with proposed cryptocurrency offerings to contact the local securities commission including in Ontario the OSC Launchpad Team at . CSA Staff Notice 46-307 is available from the websites of the participating jurisdictions including the website of the Ontario Securities Commission: http://www.osc.gov.on.ca/en/SecuritiesLaw\_csa\_20170824\_cryptocurrency-offerings.htm 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 Securities Laws 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/08/Barb-bar-01-1024x248.jpg)![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ \[1\] **Categories:** News & Updates --- ### [CSA Publishes National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) and National Instrument 33-109 Registration Information.](https://baxsecuritieslaw.com/csa-publishes-national-instrument-31-103-registration-requirements-exemptions-ongoing-registrant-obligations-ni-31-103-national-instrument-33-109-registration-information/) **Published:** September 9, 2017 **Author:** Barbara Hendrickson **Excerpt:** In late July 2017, the Canadian Securities Administrators (CSA) published the final amendments (the Amendments) to National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) and National Instrument 33-109 Registration Information (NI 33-109) and their respective Companion Policies, 31-103CP and 33-109CP. The... **Content:** In late July 2017, the Canadian Securities Administrators (CSA) published the final amendments (the Amendments) to National Instrument 31-103 *Registration Requirements, Exemptions and Ongoing Registrant Obligations* (NI 31-103) and National Instrument 33-109 *Registration Information* (NI 33-109) and their respective Companion Policies, 31-103CP and 33-109CP. The Amendments range from technical adjustments to more substantive matters. The CSA has organized the Amendments into four areas: “Custody Amendments,” “Exempt Market Dealer Amendments,” “Client Relationship Model Phase 2 Amendments,” and “Housekeeping Amendments.” The Amendments: - clarify the activities that may be conducted under the exempt market dealer (EMD) category of registration in respect of trades in prospectus-qualified securities to make it clear that EMDs may not participate in offerings of securities under prospectuses in any capacity; - make permanent certain temporary relief granted by the CSA in May 2015 relating to the requirements for client reporting (the CRM2 Requirements) and also add guidance to 31-103CP regarding the CRM2 Requirements; - incorporate other changes to the Instrument of a minor housekeeping nature, and; - enhance custody requirements applicable to registered firms that are not members of the Investment Industry Regulatory Organization of Canada (IIROC) or the Mutual Fund Dealers Association of Canada (MFDA) (collectively, Non-SRO Firms). IIROC member firms and MFDA member firms will comply with the custodial regimes of IIROC or the MFDA. The Custody Amendments: - address potential intermediary risks when Non-SRO Firms are involved in the custody of client assets, - enhance the protection of client assets; and, - codify existing custodial best practices of Non-SRO Firms. The Amendments are expected to be in force in all member jurisdictions on December 4, 2017. In some cases, depending on the jurisdiction, this may occur earlier. The Custody Amendments will come into force six months later, on June 4, 2018. The Final Amendments to NI 31-103 and NI 33-109 are [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_20170727_31-103_amendments.htm) from the websites of the participating jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/08/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [BCSC Registers Cryptocurrency Investment Fund Manager](https://baxsecuritieslaw.com/bcsc-registers-cryptocurrency-investment-fund-manager/) **Published:** September 20, 2017 **Author:** Barbara Hendrickson **Excerpt:** On September 6th, 2017 the British Columbia Securities Commission (“BCSC")  announced the first registration of an investment fund manager in Canada solely dedicated to cryptocurrency investments. The BCSC has granted First Block Capital Inc. registration as an investment fund manager and an exempt market dealer in... **Content:** On September 6th, 2017 the British Columbia Securities Commission (“BCSC”) announced the first registration of an investment fund manager in Canada solely dedicated to cryptocurrency investments. The BCSC has granted First Block Capital Inc. registration as an investment fund manager and an exempt market dealer in order to operate a bitcoin investment fund. According to the BCSC cryptocurrency investments raise risks that are different from traditional asset classes, including the cybersecurity risks inherent in dealing with digital currencies. These risks relate not only to the registrant, but also to the bitcoin fund’s custodian, a third party chosen to facilitate the safekeeping and exchange of bitcoins. The BCSC encourages companies in British Columbia, whether they are potential new registrants or existing investment fund managers, to contact the BCSC’s Tech Team if they are considering pursuing cryptocurrency investments in their funds. The BCSC launched the Tech Team in January 2017 as part of its fintech outreach initiative to help B.C.-based fintech and technology companies understand their securities regulatory requirements. The Tech Team is also actively involved with the Canadian Securities Administrators’ Regulatory Sandbox Initiative, which supports fintech businesses seeking to offer innovative products, services and applications in Canada. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/09/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Recent Proposed Changes to the Ontario Business Corporations Act](https://baxsecuritieslaw.com/recent-proposed-changes-ontario-business-corporations-act/) **Published:** September 27, 2017 **Author:** Janny Cho **Excerpt:** On March 7, 2017, Bill 101, Enhancing Shareholders Rights Act, 2017, was introduced in the Legislative Assembly of Ontario for amending the Business Corporations Act (Ontario) (“OBCA”). Bill 101 received second reading on March 9, 2017. Bill 101 propositions include: (1) reducing the minimum requirement... **Content:** On March 7, 2017, Bill 101, *Enhancing Shareholders Rights Act, 2017*, was introduced in the Legislative Assembly of Ontario for amending the *Business Corporations Act (Ontario)* (“**OBCA**”). Bill 101 received second reading on March 9, 2017. Bill 101 propositions include: (1) reducing the minimum requirement of aggregate shareholdings from 5% to 3% for shareholder proposal of director nomination; (2) reducing the minimum requirement of aggregate shareholdings from 5% to 3% for the requisition of a shareholder meeting; (3) requiring proxy voting to specify that the shares shall be voted for or against the election of any directors; (4) including the names of director nominees in shareholder proposals; (4) providing that a majority cast of “for” votes are required for the election of any directors; (5) providing that a separate vote of shareholders shall be taken for each director nominee; (6) requiring the disclosure of diversity information at the director and senior management level to shareholders; and (7) enabling shareholders to propose the adoption of an executive compensation policy in relation to the remuneration of directors or officers. The introduction of Bill 101 closely followed the enactment of Bill C-25 on June 21, 2017, which amends the *Canada Business Corporations Act*, the *Canada Cooperatives Act*, the *Canada Not-for-Profit Corporations Act* and the *Competition Act*. The aims of Bill C-25 include: (1) reforming some aspects of the election process of directors for some corporations; and (2) requiring some corporations to share diversity information to shareholders; and (3) changing the requirements for using the “notice-and-access” communication system with shareholders. Both Bill 101 and Bill C-25 aim to enhance the rights, engagement and control of shareholders, thereby reducing agency costs and increase the transparency of corporate governance. While reducing the shareholding threshold from 5% to 3% for director nomination and the requisition of shareholder meetings might advance the interest of the shareholders, the majority of corporations incorporated under the OBCA are smaller corporations, such as corporations with only a few shareholders. A 2% change of threshold margin might not have any significant impacts for most OBCA corporations. In addition, the CBCA currently specifies the 5% threshold. It might be a good idea to keep the requirements of the OBCA more aligned with the CBCA requirements. The OBCA specifies that a director can be elected with a single “for” vote regardless of the number of “withheld” votes in an uncontested election. In other words, a director can be elected with less than half of the support of shareholders, which is not representative of the position of the majority of shareholders. Bill 101 intends to make the election process more representative by requiring director nominees to obtain majority support from shareholders. Incumbent directors who fail to receive majority support would be required to submit their resignations. The OBCA currently allows slate voting, which enables a group of directors to be elected at the same time in an “all or none” fashion. The slate system curtails the express approval or disapproval of individual director nominee. Bill 101 proposes that slate voting should be prohibited and that each director should be elected individually. At the present time, the OBCA allows directors to be elected for a maximum term of three years. Bill 101 proposes that the maximum term should be reduced from three years to one year. Shortening the term period would allow more frequent evaluations of the performance of directors and increase their accountability to shareholders. On the other hand, the directors might not stay around long enough to make executive decisions in favour of the business’s long-term profit. Bill 101 proposes the mandatory disclosure of diversity information to shareholders at every annual meeting. However, Bill 101, similar to Bill C-25 did not clearly define “diversity”. In a June 2016 report released by the Ontario government, women continued to be underrepresented on boards and at the senior management level and Canada lagged behind in terms of gender diversity on boards compared to other developed nations. The study stated that around 20% of board members are women in Canada. In contrast, 35% of board members are women in Norway. In a [2015 MSCI ESG study](https://www.msci.com/www/research-paper/research-insight-women-on/0263428390), companies with a strong female leadership generate a return of equity of 10.1% compared to 7.4% of those without. In addition, companies without a diverse board suffer more governance related controversies. Therefore, it is in the interest of both corporations and women to have more women on board. Bill 101’s proposal regarding diversity is a laudable goal if diversity includes the category of gender. Bill 101 gave shareholders the right to submit a proposal in relation to executive compensation policies for the remuneration of directors or officers, or make a proposal to amend or appeal such policies. Currently, corporations would propose an advisory resolution with respect to the remuneration of directors or officers at a shareholder meeting. The shareholders would then either approve or disapprove the resolution. However, the shareholders’ approval, commonly known as the “say on pay” vote, is not binding on the board. The board ultimately has the final say on executive remuneration. Bill 101 proposes that the shareholders should make the executive remuneration proposals and the board should comply with the adopted proposals. Since the strength of a corporation’s management would determine the business’s profit level, improperly compensated executives would lead to the loss of management talent and ultimately the loss of profit. Therefore, shareholders, if given the final say on executive remuneration, should ensure that the level of remuneration attracts talent, aligns with the shareholders’ interest, and promotes the creation of long-term wealth for shareholders. Bill 101 has laudable goals. However, its practical implications might be limited. For example, a reduction of 2% threshold margin might not lead to any significant impacts on OBCA corporations. Modification of the plurality voting scheme, elimination of slate voting and shortening of the term of office would enable shareholders to engage in a more democratic and representative system. On the other hand, directors who are only in office for a short term might not be interested in making executive decisions in favour of the business’s long-term profit. Although encouraging diversity on board is an important goal, Bill 101 did not specify the categories of diversity. Granting the final say on executive remuneration to the shareholders can be a risky exercise and shareholders must be educated on how to determine an appropriate package for the management team. For more information, please call Janny Cho at (416) 601-0591 or Barbara Hendrickson (416) 601 -1004 at BAX Securities Law. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Canadian Securities Regulators Announce Ban on Binary Options](https://baxsecuritieslaw.com/canadian-securities-regulators-announce-ban-binary-options/) **Published:** October 1, 2017 **Author:** Barbara Hendrickson **Excerpt:** On September 28, 2017, the Canadian Securities Administrators (“CSA”) announced the implementation of Multilateral Instrument 91-102 Prohibition of Binary Options (“MI 91-102” or the “Instrument”) and the Companion Policy 91-102 Prohibition of Binary Options (“CP 91-102” or the “Companion Policy”), which makes it illegal to... **Content:** On September 28, 2017, the Canadian Securities Administrators (“**CSA**”) announced the implementation of Multilateral Instrument 91-102 *Prohibition of Binary Options* (“**MI 91-102**” or the “**Instrument**”) and the Companion Policy 91-102 *Prohibition of Binary Options* (“**CP 91-102**” or the “**Companion Policy**”), which makes it illegal to advertise, offer, sell or otherwise trade binary options shorter than 30 days with any individual. MI 91-102 is scheduled to come into effect on December 12, 2017 in all Canadian jurisdictions except British Columbia. The purpose of MI 91-102 according to the CSA is to protect investors from becoming victims of binary options fraud and from an illegal promotion of extremely high-risk products. To this end, the Instrument and its Companion Policy explicitly prohibits advertising, offering, selling or otherwise trading a binary option with or to an individual. CSA staff identified binary options as the leading type of investment fraud facing Canadian investors. Binary options take the form of a wager in which investors bet on the performance of an underlying asset, often a currency, stock index, or share, and the timeframe on this bet is typically very short, sometimes hours or even minutes. When the ‘investment’ period is up, the investor receives a predetermined payout or loses the entire amount. Binary options “traders” rely on websites and social media ads to market their product, which makes it difficult to determine their location. The firms and individuals involved in the operation of binary options trading platforms are often located overseas. Investing offshore is a common red flag of fraud, as it may be impossible for investors to get their money back if something goes wrong. According to the CSA the overwhelming majority of binary options sites are “rigged and the entire interaction takes place for the purpose of defrauding investors. Binary options are sometimes marketed under other names, including “all-or-nothing options,” “asset-or-nothing options,” “bet options,” “cash-or-nothing options,” “digital options,” “fixed-return options,” and “one-touch options.” CSA staff advise anyone who has invested with, or has concerns about, an offshore binary options trading platform should immediately contact their local securities regulator. For more information on binary options fraud, and tips on how investors can protect themselves, please visit . Multilateral Instrument 91-102 *Prohibition of Binary Options* and the Companion Policy are [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170927_91-102_binary-options.htm) from the websites of participating member jurisdictions. The British Columbia Securities Commission (BCSC) is not an authority implementing the Binary Options Rule. BC Notice 2017/02 – *Binary Options*, which discusses the regulation of binary options in British Columbia, is [available for download](https://www.bcsc.bc.ca/BCN_2017-02_%5bBCN%5d_09282017/) 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/09/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Update on Crowd Funding Start-up Crowdfunding Registration and Prospectus Exemptions](https://baxsecuritieslaw.com/update-crowd-funding-start-crowdfunding-registration-prospectus-exemptions-2/) **Published:** October 9, 2017 **Author:** Barbara Hendrickson **Excerpt:** On September 21, 2017, the British Columbia Securities Commission (“BCSC”) published the amended BC Instrument 45-535 Start-up Crowdfunding Registration and Prospectus Exemptions, (the “BC Instrument 45-515”), which details improvements to crowdfunding rules that will enable BC-based issuers to access investors in Alberta when conducting crowdfunding... **Content:** On September 21, 2017, the British Columbia Securities Commission (“**BCSC**”) published the amended BC Instrument 45-535 *Start-up Crowdfunding Registration and Prospectus Exemptions*, (the “**BC Instrument 45-515**”), which details improvements to crowdfunding rules that will enable BC-based issuers to access investors in Alberta when conducting crowdfunding campaigns. These amendments also raise the limit on investments, from $1500 to $5000. The amendments are the result of a survey carried earlier in the year out by BCSC staff of BC Fintech business and stakeholders. The survey identified the lack of harmonization across jurisdictions as one of the major concerns. The new amendments take steps to resolve that issue by allowing an interface between the BC and Alberta crowdfunding rules. Respondents also recommended increasing the investment amounts allowed under the current crowdfunding rules. The new amendments raise the investment limit from $1500 to $5000 if the investor has obtained advice from a registered dealer that the investment is suitable for them. BC Instrument 45-515 is the local BC rule for what has been referred to as the “Start-up Exemption” which was implemented in British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia (the “**Start-up Jurisdictions**”) in May of 2015 by local rules. See CSA Notice 45-316 “Start-up Crowdfunding Registration and Prospectus Exemptions” published on May 14, 2015 as amended – see CSA Notice 45-317 published on January 21, 2016 and CSA Notice 45-319 published on June 30, 2016 (“**Start-up Exemption**”). To date there has been no CSA notice evidencing amendments to the local rules of the Start-up Jurisdictions which would correspond to the recent BC amendments. The following is a summary of BC Instrument 45-515 which will expire on May 13, 2020. **Type of securities***:* BC Instrument 45-535 is limited to distributions by an issuer of securities of its own issue and to certain types of securities: common shares, non-convertible preference shares, securities convertible into common shares or non-convertible, preference shares, non-convertible debt securities linked to a fixed or floating interest rate; and units of a limited partnership. **Restrictions on offerings**: The issuer (and the issuer group) cannot raise aggregate funds totaling more than $250,000 per distribution. Offerings cannot remain open for more than 90 days. The exemption cannot be used more than twice in a calendar year. The minimum amount must be equal to the amount needed to carry out the purpose for which the funds are sought. There can be no concurrent offerings using the exemption for the same project. **Issuers*:* BC Instrument 45-535 is not available for reporting issuers. The issuer’s head office must be located in Canada and the majority of the directors must be Canadian residents. This exemption is not available to investment funds. None of the promoters, directors, officers and control persons (collectively, the principals) of the issuer group can be a principal of the funding portal. Each promoter, officer, director and control person of the issuer must deliver a complete individual information form at least 10 business days prior to beginning to trade. **Investment limits:** An investor cannot invest more than $5,000 in a single investment under the Start-Up Exemption if the investor has obtained advice from a registered dealer that the investment was suitable for them. An investor cannot invest more than $1,500 without that advice. **Offering document / risk acknowledgement** **form*:*** Issuers must provide standardized offering document that includes basic information about the issuer, its management and the distribution, including how the issuer intends to use the funds raised and the minimum offering amount. No financial statements are required. Investors must be provided with a risk warning that includes that: the investor understands they may lose their entire investment; the investor understands the illiquid nature of the investment; the investor has read and understood the offering document; the investment opportunity has not been approved by a participating jurisdiction; the investor has not received advice from the portal or the government of a participating jurisdiction; the investor doesn’t have as many legal rights when purchasing under this exemption as they would through a prospectus offering; and they reside in a participating jurisdiction. Offering documents are required to disclose minimum offering size and whether there is a maximum offering size. The funding portal must make the offering document of the issuer and the risk warnings available online to purchasers and does not allow a subscription until the purchasers have confirmed that they have read and understood the documents. **Statutory / contractual rights**: The issuer must grant individual purchasers a contractual right to withdraw their offer to purchase securities within 48 hours of the purchaser’s subscription or notification to the purchaser that the offering document has been amended or if the start-up crowdfunding distribution is withdrawn by the issuer. If the minimum raise is not achieved the portal must return the funds to the purchasers. **Ongoing disclosure**: There is no requirement for ongoing disclosure above any corporate requirements. **Issuer reporting requirements*:*** Report of trade forms must be filed by issuers within 30 days of the closing of the distribution along with the offering document. Issuers in BC must file Form 45-106F1 through BCSC eServices. **Commissions or fees:** The funding portal cannot receive a fee from any purchaser of the securities sold through the portal. **Portal requirements:** There is no registration requirement for the portals provided that the funding portal provides the BCSC with certain documentation included a completed Forms 3 and 4 and has not been notified that the business of the funding portal is prejudicial to the public interest and meets certain requirements. The funding portal cannot provide advice to a purchaser or otherwise recommend or represent that an eligible security is suitable, or about the merits of the investment. The funding portal must maintain books and records at its head office to accurately record its financial affairs and client transactions, and to demonstrate the extent of the funding portal’s compliance with BC Instrument 45-535 orders for a period of eight years from the date a record is created. The amended BC Instrument 45-535 is available from the website of the British Columbia Securities Commission. https://www.bcsc.bc.ca/Securities\_Law/Policies/Policy4/PDF/45-535\_\_BCI\_\_\_July\_13\_\_2017/ 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Update on Crowd Funding Start-up Crowdfunding Registration and Prospectus Exemptions](https://baxsecuritieslaw.com/update-crowd-funding-start-crowdfunding-registration-prospectus-exemptions/) **Published:** October 1, 2017 **Author:** Barbara Hendrickson **Excerpt:** On September 21, 2017, the British Columbia Securities Commission (“BCSC”) published the amended BC Instrument 45-535 Start-up Crowdfunding Registration and Prospectus Exemptions, (the “BC Instrument 45-515”), which details improvements to crowdfunding rules that will enable BC-based issuers to access investors in Alberta when conducting crowdfunding... **Content:** On September 21, 2017, the British Columbia Securities Commission (“**BCSC**”) published the amended BC Instrument 45-535 *Start-up Crowdfunding Registration and Prospectus Exemptions*, (the “**BC Instrument 45-515**”), which details improvements to crowdfunding rules that will enable BC-based issuers to access investors in Alberta when conducting crowdfunding campaigns. These amendments also raise the limit on investments, from $1500 to $5000. The amendments are the result of a survey carried earlier in the year out by BCSC staff of BC Fintech business and stakeholders. The survey identified the lack of harmonization across jurisdictions as one of the major concerns. The new amendments take steps to resolve that issue by allowing an interface between the BC and Alberta crowdfunding rules. Respondents also recommended increasing the investment amounts allowed under the current crowdfunding rules. The new amendments raise the investment limit from $1500 to $5000 if the investor has obtained advice from a registered dealer that the investment is suitable for them. BC Instrument 45-515 is the local BC rule for what has been referred to as the “Start-up Exemption” which was implemented in British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia (the “**Start-up Jurisdictions**”) in May of 2015 by local rules. See CSA Notice 45-316 “Start-up Crowdfunding Registration and Prospectus Exemptions” published on May 14, 2015 as amended – see CSA Notice 45-317 published on January 21, 2016 and CSA Notice 45-319 published on June 30, 2016 (“**Start-up Exemption**”). To date there has been no CSA notice evidencing amendments to the local rules of the Start-up Jurisdictions which would correspond to the recent BC amendments. The following is a summary of BC Instrument 45-515 which will expire on May 13, 2020. **Type of securities***:* BC Instrument 45-535 is limited to distributions by an issuer of securities of its own issue and to certain types of securities: common shares, non-convertible preference shares, securities convertible into common shares or non-convertible, preference shares, non-convertible debt securities linked to a fixed or floating interest rate; and units of a limited partnership. **Restrictions on offerings**: The issuer (and the issuer group) cannot raise aggregate funds totaling more than $250,000 per distribution. Offerings cannot remain open for more than 90 days. The exemption cannot be used more than twice in a calendar year. The minimum amount must be equal to the amount needed to carry out the purpose for which the funds are sought. There can be no concurrent offerings using the exemption for the same project. **Issuers*:* BC Instrument 45-535 is not available for reporting issuers. The issuer’s head office must be located in Canada and the majority of the directors must be Canadian residents. This exemption is not available to investment funds. None of the promoters, directors, officers and control persons (collectively, the principals) of the issuer group can be a principal of the funding portal. Each promoter, officer, director and control person of the issuer must deliver a complete individual information form at least 10 business days prior to beginning to trade. **Investment limits:** An investor cannot invest more than $5,000 in a single investment under the Start-Up Exemption if the investor has obtained advice from a registered dealer that the investment was suitable for them. An investor cannot invest more than $1,500 without that advice. **Offering document / risk acknowledgement** **form*:*** Issuers must provide standardized offering document that includes basic information about the issuer, its management and the distribution, including how the issuer intends to use the funds raised and the minimum offering amount. No financial statements are required. Investors must be provided with a risk warning that includes that: the investor understands they may lose their entire investment; the investor understands the illiquid nature of the investment; the investor has read and understood the offering document; the investment opportunity has not been approved by a participating jurisdiction; the investor has not received advice from the portal or the government of a participating jurisdiction; the investor doesn’t have as many legal rights when purchasing under this exemption as they would through a prospectus offering; and they reside in a participating jurisdiction. Offering documents are required to disclose minimum offering size and whether there is a maximum offering size. The funding portal must make the offering document of the issuer and the risk warnings available online to purchasers and does not allow a subscription until the purchasers have confirmed that they have read and understood the documents. **Statutory / contractual rights**: The issuer must grant individual purchasers a contractual right to withdraw their offer to purchase securities within 48 hours of the purchaser’s subscription or notification to the purchaser that the offering document has been amended or if the start-up crowdfunding distribution is withdrawn by the issuer. If the minimum raise is not achieved the portal must return the funds to the purchasers. **Ongoing disclosure**: There is no requirement for ongoing disclosure above any corporate requirements. **Issuer reporting requirements*:*** Report of trade forms must be filed by issuers within 30 days of the closing of the distribution along with the offering document. Issuers in BC must file Form 45-106F1 through BCSC eServices. **Commissions or fees:** The funding portal cannot receive a fee from any purchaser of the securities sold through the portal. **Portal requirements:** There is no registration requirement for the portals provided that the funding portal provides the BCSC with certain documentation included a completed Forms 3 and 4 and has not been notified that the business of the funding portal is prejudicial to the public interest and meets certain requirements. The funding portal cannot provide advice to a purchaser or otherwise recommend or represent that an eligible security is suitable, or about the merits of the investment. The funding portal must maintain books and records at its head office to accurately record its financial affairs and client transactions, and to demonstrate the extent of the funding portal’s compliance with BC Instrument 45-535 orders for a period of eight years from the date a record is created. The amended BC Instrument 45-535 is available from the website of the British Columbia Securities Commission. [https://www.bcsc.bc.ca/Securities\_Law/Policies/Policy4/PDF/45-535\_\_BCI\_\_\_July\_13\_\_2017/](_wp_link_placeholder) 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Canadian Securities Regulators Publish CSA Staff Notice 33-321, Cyber Security and Social Media](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-csa-staff-notice-33-321-cyber-security-social-media/) **Published:** October 25, 2017 **Author:** Barbara Hendrickson **Excerpt:** On October 19, 2017, the Canadian Securities Administrators (“CSA”) published CSA Staff Notice 33-321 Cyber Security and Social Media, (“Notice”) which summarizes survey results of registered firms' cyber security and social media practices, in addition to providing guidance to firms in these areas. According to... **Content:** On October 19, 2017, the Canadian Securities Administrators (“CSA”) published CSA Staff Notice 33-321 Cyber Security and Social Media, (“Notice”) which summarizes survey results of registered firms’ cyber security and social media practices, in addition to providing guidance to firms in these areas. According to the Notice, over the last few years, both cyber threats and issues surrounding social media have posed growing risks for registered firms. Between October and November, 2016, the CSA conducted a survey designed to gather information from 1,000 firms registered as investment fund managers, portfolio managers, and exempt market dealers to form the basis for providing guidance about cyber security and social media practices. CSA staff report that 51% of firms surveyed experienced a cyber security incident in 2016. Of the firms surveyed, 43% reported phishing incidents, 18% reported incidents involving malware, and 15% of firms surveyed reported fraudulent email attempts to transfer funds or securities. In addition, the survey also found that most firms have policies and procedures on social media practices. While 59% of firms surveyed have guidelines on the appropriate and inappropriate use of social media, only 36% reported they had policies and procedures in place specifically regarding the training of employees in social media use and 21% had specific recordkeeping policies for social media communications. In terms of guidance, CSA staff recommend that firms have policies and procedures in place that not only address the following areas but also ensure that employees are adequately trained in them: • use of electronic communications, including the types of information that may be collected or sent through email, use of secured or unsecured communication systems and the verification of client instructions sent electronically; • use of firm-issued electronic devices, including the use of such devices to externally access the firm’s network and data; • the loss or disposal of an electronic device, including electronic storage devices; • use of public electronic devices or public internet connections to remotely access the firm’s network and data, including to access client communications or client information; • detecting internal or external unauthorized activity on the firm’s network or electronic devices (e.g., hacking attempts, phishing or suspicious emails, malware); • ensuring software, including anti-virus programs, is updated in a timely manner; • overseeing third-party vendors or service providers with access to the firm’s network or data (e.g., vetting, confidentiality); and, • reporting any cyber security incidents to the board of directors (or equivalent). On the subject of social media, CSA staff also issued the following guidance, advising that firms should review, supervise, retain and have the ability to retrieve social media content. Policies and procedures on social media practices should include: • guidelines on the appropriate use of social media, including the use of social media for business purposes; • guidelines on what content is permitted when using social media; • procedures for ensuring that social media content is current; • record keeping requirements for social media content; and, • reviews and approvals of social media content, including evidence of such reviews and approvals. CSA staff recommend that these policies and procedures should be designed to safeguard the confidentiality, integrity, and availability of the firm’s data, including the personal information of clients. To stay up-to-date with changing cyber threats, firms should review and update these policies and procedures frequently. CSA Staff Notice 33-321 Cyber Security and Social Media, is available for download from the websites of participating member jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [OSC Grants Approval for First Initial Coin Offering](https://baxsecuritieslaw.com/osc-grants-approval-first-initial-coin-offering/) **Published:** October 30, 2017 **Author:** Barbara Hendrickson **Excerpt:** On October 23, 2017, the Ontario Securities Commission (“OSC”) has granted approval to the province’s first regulated Initial Coin Offering (“ICO”) in a decision (“decision”).  The OSC granted regulatory relief to Toronto-based TokenFunder Inc. (“TokenFunder”). This exempts ToeknFunder from the dealer registration requirements and allows... **Content:** On October 23, 2017, the Ontario Securities Commission (“**OSC**”) has granted approval to the province’s first regulated Initial Coin Offering (“**ICO**”) in a [decision](http://www.osc.gov.on.ca/en/SecuritiesLaw_ord_20171023_token.htm) (“**decision**”). The OSC granted regulatory relief to Toronto-based TokenFunder Inc. (“**TokenFunder**”). This exempts ToeknFunder from the dealer registration requirements and allows it to carry out an ICO under existing prospectus exemptions subject to certain conditions. ICOs, sometimes known as Initial Token Offerings (“**ITOs**”), have been gaining in popularity. They are used by start-up businesses to raise capital from investors through the internet, using a cryptocurrency such as Bitcoin or Ethereum. In many ways, an ICO/ITO can be very similar to an initial public offering (IPO). The coins/tokens can be similar to traditional shares of a company because their value may increase or decrease depending on how successfully the business executes its business plan using the capital raised. The decision treats the ICOs in the TokenFunder capital raise as a security. The company intends to use the funds raised by the ICO to construct a token issuance and governance platform that will enable third-party investors to raise capital through investments in blockchain-based securities. However, before TokenFunder can operationalize the platform they will be required to return to the OSC for registration as an exempt market dealer. The decision, which is due to expire after a 12-month period, was granted to TokenFunder with a number of conditions, including that the company conduct know-your-client (KYC) and suitability reviews for each investor and investors will have to be educated to ensure they have a “detailed understanding” of cryptocurrency and digital token offerings. TokenFunder must also establish and maintain policies and procedures to manage the risks associated regarding Ethereum Blockchain, cybersecurity and conflicts of interest between the company and its investors. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Canadian Securities Regulators Publish CSA Staff Notice 33-321, Cyber Security and Social Media](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-csa-staff-notice-33-321-cyber-security-social-media-2/) **Published:** October 30, 2017 **Author:** Barbara Hendrickson **Excerpt:** On October 19, 2017, the Canadian Securities Administrators (“CSA”) published CSA Staff Notice 33-321 Cyber Security and Social Media, which summarizes survey results of registered firms' cyber security and social media practices, in addition to providing guidance to firms in these areas. According to the... **Content:** On October 19, 2017, the Canadian Securities Administrators (“**CSA**”) published CSA Staff Notice 33-321 *Cyber Security and Social Media*, which summarizes survey results of registered firms’ cyber security and social media practices, in addition to providing guidance to firms in these areas. According to the CSA, over the last few years, both cyber threats and issues surrounding social media have posed growing risks for registered firms. Reflecting the growth in technology, the risks posed by cybercrime and social media have increased in complexity and in number. Between October and November 2016, the CSA conducted a survey designed to gather information from 1,000 firms registered as investment fund managers, portfolio managers, and exempt market dealers to form the basis for providing guidance about cyber security and social media practices. CSA staff report that 51% of firms surveyed experienced a cyber security incident in 2016. Of the firms surveyed, 43% reported phishing incidents, 18% reported incidents involving malware, and 15% of firms surveyed reported fraudulent email attempts to transfer funds or securities. In addition, the survey also found that most firms have policies and procedures on social media practices. While 59% of firms surveyed have guidelines on the appropriate and inappropriate use of social media, only 36% reported they had policies and procedures in place specifically regarding the training of employees in social media use and 21% had specific recordkeeping policies for social media communications. In terms of guidance, CSA staff recommend that firms have policies and procedures in place that not only address the following areas but also ensure that employees are adequately trained in them: - use of electronic communications, including the types of information that may be collected or sent through email, use of secured or unsecured communication systems and the verification of client instructions sent electronically; - use of firm-issued electronic devices, including the use of such devices to externally access the firm’s network and data; - the loss or disposal of an electronic device, including electronic storage devices; - use of public electronic devices or public internet connections to remotely access the firm’s network and data, including to access client communications or client information; - detecting internal or external unauthorized activity on the firm’s network or electronic devices (e.g., hacking attempts, phishing or suspicious emails, malware); - ensuring software, including anti-virus programs, is updated in a timely manner; - overseeing third-party vendors or service providers with access to the firm’s network or data (e.g., vetting, confidentiality); and, - reporting any cyber security incidents to the board of directors (or equivalent). On the subject of social media, CSA staff also issued the following guidance, advising that firms should review, supervise, retain and have the ability to retrieve social media content. Policies and procedures on social media practices should include: - guidelines on the appropriate use of social media, including the use of social media for business purposes; - guidelines on what content is permitted when using social media; - procedures for ensuring that social media content is current; - record keeping requirements for social media content; and, - reviews and approvals of social media content, including evidence of such reviews and approvals. CSA staff recommend that these policies and procedures should be designed to safeguard the confidentiality, integrity, and availability of the firm’s data, including the personal information of clients. To stay up-to-date with changing cyber threats, firms should review and update these policies and procedures frequently. CSA Staff Notice 33-321 *Cyber Security and Social Media*, is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20171019_33-321_cyber-security-and-social-media.htm) from the websites of participating member jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [CSA Consultation Paper 52-404: Approach to Director and Audit Committee Member Independence](https://baxsecuritieslaw.com/csa-consultation-paper-52-404-approach-director-audit-committee-member-independence/) **Published:** November 6, 2017 **Author:** Barbara Hendrickson **Excerpt:** On October 26, 2017, the Canadian Securities Administrators (“CSA”) published CSA Consultation Paper 52-404, Approach to Director and Audit Committee Member Independence (“Consultation Paper”). The purpose of the Consultation Paper is to encourage a discussion regarding the CSA's approach to determining director and audit committee... **Content:** On October 26, 2017, the Canadian Securities Administrators (“**CSA**”) published *CSA Consultation Paper 52-404,* *Approach to Director and Audit Committee Member Independence* (“**Consultation Pap**er”). The purpose of the Consultation Paper is to encourage a discussion regarding the CSA’s approach to determining director and audit committee member independence and to solicit views on whether any changes should be considered. The Consultation Paper is being published for a 90-day comment period, ending on January 25, 2018. The corporate governance regime Canada (“**regime**”) and the approach taken by the CSA to determine the independence of a director or an audit committee member (“**approach**”) has its beginnings with two important documents: - The 1994 report sponsored by the Toronto Stock Exchange, *Where were the Directors?* (“**Dey Report**”) became the basis for the regime. The regime encompasses guidelines related to the exercise of independent judgement, including the composition of the board of directors (“**board**”) and the audit committee. Non-venture issuers must provide disclosure with reference to the guidelines within the framework of a “comply or explain” disclosure model, whereas venture issuers are subject to more basic disclosure requirements; and, - *Multilateral Instrument 52-110, Audit Committees* and *Companion Policy 52-110CP Audit Committees* was adopted by the CSA in 2004, as the basis for the approach. Subsequent updates over the years have brought the approach to its current iteration. The approach used by the CSA is largely subjective, but it has elements, such as bright-line tests, that when applied do not permit a board to determine whether a director could reasonably be expected to exercise independent judgement. Stakeholders have expressed concerns regarding the approach: - the approach excluded individuals with the requisite expertise and judgement from being considered as independent members of a board or from being able to serve as audit committee members; - the approach has limited the pool of individuals who could be considered independent to the detriment of certain issuers; and - the approaches used in other jurisdictions, such as the UK, Sweden and Australia should be considered. CSA Consultation Paper 52-404, *Approach to Director and Audit Committee Member Independence,* is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_sn_20171026_52-404_committee-member-independence.htm) from the websites of participating member jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Institutional Investors Release Declaration on Financial Risks Related to Climate Change](https://baxsecuritieslaw.com/institutional-investors-release-declaration-financial-risks-related-climate-change/) **Published:** November 20, 2017 **Author:** Barbara Hendrickson **Excerpt:** Pressure is continuing to grow on Canadian companies to disclose the risks associated with climate change. In late October, 2017, thirty Canadian and international financial institutions and pension funds representing approximately CAD $1.2 trillion in assets under management, issued a joint Declaration of Institutional Investors... **Content:** Pressure is continuing to grow on Canadian companies to disclose the risks associated with climate change. In late October, 2017, thirty Canadian and international financial institutions and pension funds representing approximately CAD $1.2 trillion in assets under management, issued a joint Declaration of Institutional Investors on Climate-Related Financial Risks (the declaration). The declaration, supported in principle by 13 organizations, calls on Canadian publicly traded companies to commit to enhanced disclosure on their exposure to climate change risks, and the measures they are taking to manage them. The declaration’s signatories intend to work with these companies to help them mitigate their climate change risks. By signing the declaration, the signatories are advocating for other economic and financial institutions to join forces in order to stimulate sustainable world economic growth, while reducing environmental impact. The declaration remains open to new signatories who wish to endorse it. The full text of the declaration, as well as a complete list of signatories, is available [here](http://www.finance-montreal.com/sites/default/files/publications/declaration_institutional_investors_on_climate_related_financial_risks.pdf). 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [November 17, 2017: 2017 Ontario Economic and Fiscal Review Confirms Changes Ahead for Syndicated Mortgages and Financial Planners](https://baxsecuritieslaw.com/november-17-2017-2017-ontario-economic-fiscal-review-confirms-changes-ahead-syndicated-mortgages-financial-planners/) **Published:** November 20, 2017 **Author:** Barbara Hendrickson **Excerpt:** On November 17, 2017, the Ontario Government released its 2017 Ontario Economic and Fiscal Review (the Review). The Review contains advance notice of two important forthcoming changes for the securities industry in Ontario. First, it confirmed that the province is moving forward with regulatory changes... **Content:** On November 17, 2017, the Ontario Government released its [2017 Ontario Economic and Fiscal Review](https://www.fin.gov.on.ca/en/budget/fallstatement/2017/) (the Review). The Review contains advance notice of two important forthcoming changes for the securities industry in Ontario. First, it confirmed that the province is moving forward with regulatory changes regarding syndicated mortgages; and second, it also confirmed that the government is introducing legislation regarding the regulation of financial planners in Ontario. **Syndicated Mortgages** Ontario is moving forward with regulatory changes that will strengthen protections for investors in syndicated mortgages. This includes expanding requirements to ensure that mortgage brokers provide investors with the information they need to effectively assess their level of risk when investing in these products. The government is reviewing the feedback received over the last few months through consultations on potential changes to regulations under the *Mortgage Brokerages, Lenders and Administrators Act, 2006* that would: - Establish investment limits on these products to prevent retail investors from becoming overly concentrated in an investment that carries a high risk; and, - Require mortgage brokerages to document their assessments of whether a product is suitable for their clients to ensure that only investors who can tolerate the high risks associated with these products are investing in them. The Province also plans to propose amendments to the *Securities Act* to transfer the regulatory oversight of syndicated mortgage investments from the Financial Services Commission of Ontario (FISCO) to the Ontario Securities Commission (OSC). **Regulating Financial Planners** The Province also is planning to introduce legislation to regulate financial planners in Ontario. Under the proposed framework, financial planners would be required to meet specified proficiency requirements. The government will also take steps to reduce consumer confusion created by the wide variety of titles used in the industry, by restricting the use of titles related to financial planning. Moving forward, the government will consult extensively with stakeholders in shaping the proposed framework. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [CSA Multilateral Staff Notice 58-309 - Staff Review of Women on Boards and in Executive Officer Positions – Compliance with NI 58-101 Disclosure of Corporate Governance Practices](https://baxsecuritieslaw.com/csa-multilateral-staff-notice-58-309-staff-review-women-boards-executive-officer-positions-compliance-ni-58-101-disclosure-corporate-governance-practices/) **Published:** November 24, 2017 **Author:** Barbara Hendrickson **Excerpt:** On October 5, 2017, the participating jurisdictions of the securities regulatory authorities of all provinces with the exceptions of British Columbia and PEI (the “Participating Jurisdictions”) published a review (the Staff Notice) of disclosure regarding women on boards and in executive officer positions. The Staff... **Content:** On October 5, 2017, the participating jurisdictions of the securities regulatory authorities of all provinces with the exceptions of British Columbia and PEI (the “**Participating Jurisdictions**”) published a review (the Staff Notice) of disclosure regarding women on boards and in executive officer positions. The Staff Notice is a review of corporate governance disclosure of 660 non-venture issuers regarding women in leadership roles in accordance with *National Instrument 58-101 – Disclosure of Corporate Governance Practices* (“**NI 58-101**”). NI 58-101 takes a “disclose or explain” approach; the approach requires non-venture issuers in most provinces to disclose information about their policies and procedures regarding the representation of women on boards and in executive officer positions, or to explain the absence of such policies or procedures. Issuers with year ends between December 31, 2016 and March 31, 2017 were studied and compared with the results of a similar study conducted three years ago, with these results: - The total board seats occupied by women has increased from 11% to 14%. - The percentage of issuers with at least one woman on their board increased from 49% to 61%. - For issuers with a market capitalization of more than $10 billion, 24% of board seats are held by women, in contrast to 21% in the first year. - Of the issuers in the sample, issuers with at least one woman in an executive officer position increased from 60% to 62%. - The percentage of issuers that adopted a policy relating to the representation of women on their board increased from 15% to 35%. In terms of compliance, the Staff Notice reported among issuers: - 97% disclosed the number or percentage of women on their boards; - 94% disclosed the number or percentage of women in executive officer positions; - 99% disclosed whether they had adopted a policy relating to the identification and nomination of women directors; - 96% disclosed whether they had set targets for the representation of women on their boards; - 95% disclosed whether they had set targets for the representation of women in executive officer positions; and, - 98% disclosed whether they had adopted director term limits, other mechanisms of board renewal, or both. *CSA Multilateral Staff Notice 58-309 – Staff Review of Women on Boards and in Executive Officer Positions – Compliance with NI 58-101 Disclosure of Corporate Governance Practices,* is [available for download](https://www.osc.gov.on.ca/documents/en/Securities-Category5/sn_20171005_58-309_staff-review-women-on-boards.pdf) from the websites of participating member jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Canadian Securities Regulators, Investment Industry Regulatory Organization of Canada and Mutual Fund Dealers Association of Canada issue joint notice regarding the Ombudsman for Banking Services and Investments](https://baxsecuritieslaw.com/canadian-securities-regulators-investment-industry-regulatory-organization-canada-mutual-fund-dealers-association-canada-issue-joint-notice-regarding-ombudsman-banking-services/) **Published:** December 14, 2017 **Author:** Barbara Hendrickson **Excerpt:** On December 7, 2018, the Canadian Securities Administrators (CSA), the Investment Industry Regulatory Organization of Canada (IIROC), and the Mutual Fund Dealers Association of Canada (MFDA) (the regulators) jointly released CSA Staff Notice 31-351, IIROC Notice 17-0229, MFDA Bulletin #0736-M Complying with requirements regarding the... **Content:** On December 7, 2018, the Canadian Securities Administrators (CSA), the Investment Industry Regulatory Organization of Canada (IIROC), and the Mutual Fund Dealers Association of Canada (MFDA) (the regulators) jointly released *CSA Staff Notice 31-351, IIROC Notice 17-0229, MFDA Bulletin #0736-M Complying with requirements regarding the Ombudsman for Banking Services and Investments (OBSI)* (The Joint CSA/IIROC/MFDA Staff Notice). The Joint CSA/IIROC/MFDA Staff Notice highlights concerns about some registered firms’ complaint handling systems and participation in OBSI’s services and sets out potential regulatory responses. The three regulators, which jointly oversee the OBSI through the Joint Regulators Committee (JRC), have outlined a number of concerns of regarding the practices of certain registered firms: - not providing a client with appropriate notification of OBSI’s services within the required timeframes pursuant to subsections 13.16(2), 13.16(3), 13.16(4) and paragraph 14.2(2)(j) of NI 31-103 or the SRO rules; - misrepresenting OBSI’s services in communications with a client (for example, by implying that OBSI’s services do not become immediately available to the client pursuant to the requirements through the placement and prominence given to OBSI as a complaint dispute resolution service, the language used to describe timelines to access the services of OBSI or the sequence of escalation options following receipt of the firm’s decision); - exerting pressure on a client to not use OBSI’s services; - failing to establish and implement complaint handling policies and procedures regarding notification to clients of when and how the complaint can be submitted to OBSI for investigation; and, - not fully cooperating or assisting OBSI with its investigation of a complaint consistent with OBSI’s Terms of Reference or the SRO rules; and/or pressuring a client to accept any offer. The regulators are also concerned regarding the use of an internal “ombudsman” by some firms as part of their complaint handling systems, which while not prohibited under Companion Policy 31-103 *Registration Requirements, Exemptions and Ongoing Registrant Obligations* (CP 31-303*)*, they caution must be fully in compliance with CP 31-303. The regulators warn that an internal ombudsman must not be presented as an “alternative” to the OBSI, nor that it must not be portrayed as something that must be accessed before the OBSI process can be entered into. The regulators see a potential danger that if an internal ombudsman is used as part of the complaint resolution process that it could be used in an abusive manner to wear down an investor to accept a lesser settlement. The Joint CSA/IIROC/MFDA Staff Notice also sets out regulatory remedies, including but not limited to: - recommending terms and conditions on the registration of the firm or registered individuals to mitigate risks in the area of concern; and, - initiating an enforcement investigation of the registered firm and/or registered individual relating to the issue. The regulators stress their expectations that firms must participate in the OBSI’s dispute resolution process with their clients fairly, honestly, and expeditiously. They caution firms that they are also expected to respond in good faith to each customer complaint in a manner that a reasonable investor would consider fair and effective. They will continue to consider options for strengthening OBSI’s ability to secure redress for investors, a key recommendation made by the independent evaluator in its 2016 report. *CSA Staff Notice 31-351, IIROC Notice 17-0229, MFDA Bulletin #0736-M Complying with requirements regarding the Ombudsman for Banking Services and Investments (OBSI),* is [available for download](https://www.bcsc.bc.ca/31-351_%5bJoint_CSA_Staff_Notice%5d_12072017/) from the websites of participating member jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [CSA Staff Notice 23-320 Consideration of the Markets in Financial Instruments Directive (MiFID II) Unbundling Requirements on the Regulatory Requirements in Canada](https://baxsecuritieslaw.com/csa-staff-notice-23-320-consideration-markets-financial-instruments-directive-mifid-ii-unbundling-requirements-regulatory-requirements-canada/) **Published:** December 19, 2017 **Author:** Barbara Hendrickson **Excerpt:** On December 14, 2017, the Canadian Securities Administrators (CSA) issued CSA Staff Notice 23-320, Consideration of the Markets in Financial Instruments Directive (MiFID II) Unbundling Requirements on the Regulatory Requirements in Canada (Staff Notice 23-320), regarding the unbundling of research inducements from trading fees under... **Content:** On December 14, 2017, the Canadian Securities Administrators (CSA) issued *CSA Staff Notice 23-320, Consideration of the Markets in Financial Instruments Directive (MiFID II) Unbundling Requirements on the Regulatory Requirements in Canada (Staff Notice 23-320),* regarding the unbundling of research inducements from trading fees under MiFID II (the MiFID II unbundling requirements) which are expected to be effective on January 3, 2018. CSA staff has engaged in consultations with key industry participants and other regulatory authorities to better understand their views and to assess the potential impact of the MiFID II unbundling requirements on the current Canadian regulatory regime under National Instrument 23-102 *Use of Client Brokerage Commissions* (NI 23-102). The CSA has published Staff Notice 23-320 to provide an update on the work that has been completed to date and to outline next steps. The CSA notes while no changes to NI 23-102 are currently forthcoming as a result of the MiFID II unbundling requirements, it will continue to monitor developments in this regard. On April 7, 2016, the European Commission issued a Delegated Directive, which proposed a complete separation of research and trading fees charged to clients by investment firms, commonly known as “unbundling of commissions.” The new MiFID II unbundling requirements are expected to apply to all European Union (EU) and third country investment firms providing investment services or activities in the EU. In Canada, the use of client brokerage commissions is governed by NI 23-102. NI 23-102 and its Companion Policy 23-102CP set out requirements pertaining to brokerage transactions involving client brokerage commissions that are directed to a dealer in return for the provision of order execution goods and services or research goods and services. The payment for research and order execution can be bundled into a single transaction commission and may be done pursuant to a commission sharing agreement. In response to the MiFID II unbundling requirements, CSA staff engaged in a series of consultations with asset managers, dealers, pension plans, and other regulatory authorities. Based on the feedback from these discussions, CSA staff has determined that MiFID II requirements do not create an immediate need to amend the current regulatory regime in Canada and changes to NI 23-102 are unnecessary at this time, since the MiFID II requirements will not directly conflict with NI 23-102. CSA staff note that when a market participant is obliged to comply with both MiFID II and NI 23-102, if they comply with MiFID II, then they could also comply with NI 23-102. CSA staff will continue to monitor the situation regarding the MiFID II unbundling requirements and any potential impact on NI 23-102. For further information, the European Securities and Markets Authority, which is responsible for MiFID II implementation, maintains a [Question and Answer document on the subject](https://www.esma.europa.eu/sites/default/files/library/esma35-43-349_mifid_ii_qas_on_investor_protection_topics.pdf). *CSA Staff Notice 23-320 Consideration of the Markets in Financial Instruments Directive (MiFID II) Unbundling Requirements on the Regulatory Requirements in Canada,* is [available for download](https://www.bcsc.bc.ca/23-320_%5bCSA_Staff_Notice%5d_12142017/) from the websites of participating member jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Multilateral Staff Notice 96-302 Variation, amendment, or revocation and replacement of Blanket Order Relief from Certain Derivatives Data Reporting Requirements under Multilateral Instrument 96-101 Trade Repositories and Derivatives Data Reporting](https://baxsecuritieslaw.com/multilateral-staff-notice-96-302-variation-amendment-revocation-replacement-blanket-order-relief-certain-derivatives-data-reporting-requirements-multilateral-instrument-96-101-t/) **Published:** December 20, 2017 **Author:** Barbara Hendrickson **Excerpt:** Effective December 15, 2017, the securities regulators in the participating jurisdictions of British Columbia, Alberta, Saskatchewan, New Brunswick, Prince Edward Island, Nova Scotia, Newfoundland and Labrador, Yukon, Northwest Territories, and Nunavut (the Participating Jurisdictions) announced they are each varying, amending, or revoking and replacing, in... **Content:** Effective December 15, 2017, the securities regulators in the participating jurisdictions of British Columbia, Alberta, Saskatchewan, New Brunswick, Prince Edward Island, Nova Scotia, Newfoundland and Labrador, Yukon, Northwest Territories, and Nunavut (the Participating Jurisdictions) announced they are each varying, amending, or revoking and replacing, in each applicable jurisdiction, harmonized discretionary relief (in each jurisdiction, the 2017 Order) from certain requirements in *Multilateral Instrument 96-101 Trade Repositories and Derivatives Data Reporting* (the TR Rule). In 2016, the Participating Jurisdictions issued harmonized discretionary relief from certain reporting requirements under the TR Rule relating to over-the-counter (OTC) derivatives in limited circumstances (collectively, the 2016 Orders). Without any form of revision, amendment or reinstatement, the 2016 Orders would have expired on December 15, 2017. The local 2017 Order varies, amends, or revokes and replaces, as applicable in the local jurisdiction. The changes in the 2017 Orders: - extend the relief relating to situations where foreign laws prevent or hinder the reporting of required information by a reporting counterparty (CSA Staff continues to monitor changes to foreign laws to determine whether this relief is necessary); - extend the relief relating to required counterparty feedback, counterparty Legal Entity Identifiers (LEI) and broker or clearing intermediary LEIs. The relief, which is consistent with changes to corresponding exemptive relief decisions issued in Manitoba, Ontario, and Québec, is intended to be transitional and will be narrowed in certain circumstances following a phase-in period of approximately six months; and, - include additional relief of a technical nature relating to reporting of valuation data to address situations where the relevant closing market data from the previous business day is not available because that day is not a business day in the jurisdiction of the relevant market. *Multilateral Staff Notice 96-302 Variation, amendment, or revocation and replacement of* *Blanket Order Relief from Certain Derivatives Data Reporting Requirements under Multilateral Instrument 96-101 Trade Repositories and Derivatives Data Reporting,* is [available for download](https://www.bcsc.bc.ca/Securities_Law/Policies/Policy9/PDF/96-302__Multilateral_CSA_Notice___December_15__2017/) from the websites of participating member jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Competition Bureau Publishes 2017 Fintech Market Study](https://baxsecuritieslaw.com/competition-bureau-publishes-2017-fintech-market-study/) **Published:** December 23, 2017 **Author:** Barbara Hendrickson **Excerpt:** On December 14, 2017, the Competition Bureau (the Bureau) published the final draft of its examination of Canada’s Fintech markets, Technology-Led Innovation in the Canadian Financial Services Sector, A Market Study, December 2017. The report is very similar to the draft report issued for comment... **Content:** On December 14, 2017, the Competition Bureau (the Bureau) published the final draft of its examination of Canada’s Fintech markets, *Technology-Led Innovation in the Canadian Financial Services Sector, A Market Study, December 2017.* The report is very similar to the draft report issued for comment in November 2017, except with the addition of an executive summary. The Bureau’s report, which is intended as guidance for Canada’s financial sector regulators, acknowledges the significant progress in adapting the Canadian regulatory environment to support innovation in the financial services sector. However, it stresses that in order to achieve important policy objectives, such as consumer protection and a stable financial system, regulations should be modernized to promote greater competition and innovation for Canadians. Based on the findings of this market study, the Bureau has proposed eleven broad recommendations for future regulation that features these characteristics: - **Technology‑neutral and device‑agnostic:** Rules that can accommodate and encourage new and yet‑to‑be developed technologies open the door to more innovative offers today and down the road; - **Principles‑based:** Instead of prescribing how a service must be carried out, the Bureau recommends a principles‑based approach that will allow regulators to be more flexible in their approach to enforcement as technology changes; - **Function-based:** Regulation should be based on the function an entity carries out**,** ensuring that all entities that perform the same function carry the same regulatory burden and when dealing with competitive providers, consumers have the same protections; - **Proportional to risk**: The Bureau says that regulation should be proportional to the risk, and recommends a tiered approach, where smaller players who pose less of a risk require less oversight. This, argues the Bureau, will give smaller players a level playing field to innovate; - **National harmonization:** The Bureau argues that regulation should be harmonized across Canada; - **Encourage collaboration:** Greater collaboration, says the Bureau, by use of such tools as regulatory sandboxes and innovation hubs, will enable a clear and unified approach to risk, innovation and competition; - **A fintech policy lead**: The Bureau argues that a Canadian fintech policy lead is needed to spearhead fintech development. This would provide, says the agency, a one‑stop resource for information and encourage greater investment in innovative businesses; - **Greater access to core infrastructure and services**: The Bureau recommends greater access to the banking system, including the payments system, under the appropriate risk management framework. This will, says the Bureau, facilitate the development of innovative new fintech services; - **Open access banking:** The Bureau supports open banking, which means greater access to both data and systems. With risk mitigation measures in place and greater access to consumer data gained through informed consent, maintains the Bureau, fintech firms can help Canadians overcome their inability or unwillingness to shop around and switch between service providers; - **Digital identification** **verification:** This, notes the Bureau, would reduce customer‑acquisition costs for service providers, ultimately reducing the costs of switching for consumers and facilitating regulatory compliance where identity verification is needed; and, - **Continued review by policymakers of the regulatory frameworks**: Doing so, says the Bureau, will ensure that these frameworks remain relevant in the context of future innovation and can achieve their objectives in a way that does not unnecessarily inhibit competition. *Technology-Led Innovation in the Canadian Financial Services Sector, A Market Study, December 2017* [is available online from the Competition Bureau’s website](http://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/04322.html). 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Ontario Securities Commission adopts final rule for distributions outside Canada](https://baxsecuritieslaw.com/ontario-securities-commission-adopts-final-rule-distributions-outside-canada/) **Published:** January 3, 2018 **Author:** Barbara Hendrickson **Excerpt:** On November 28, 2017, the Ontario Securities Commission (OSC) adopted its final rule regarding distributions outside Canada, OSC Rule 72-503 - Distributions Outside Canada (The Final Rule), including Form 72-503F Report of Distributions Outside Canada (The Final Form), and Companion Policy 72-503 Distributions Outside Canada... **Content:** On November 28, 2017, the Ontario Securities Commission (OSC) adopted its final rule regarding distributions outside Canada, OSC Rule 72-503 – Distributions Outside Canada (The Final Rule), including Form 72-503F Report of Distributions Outside Canada (The Final Form), and Companion Policy 72-503 Distributions Outside Canada (The Final Companion Policy). A consequential amendment to OSC Rule11-501 Electronic Delivery of Documents To The Ontario Securities Commission (The Final Consequential Amendment) has also been adopted (Taken together, The Final Rule). The Final Rule provides explicit exemptions that preserve current cross-border practices, and responds to the challenges issuers and intermediaries face in determining whether a prospectus must be filed or an exemption from the prospectus requirement must be relied on, and the effect of related dealer registration requirements, in connection with a distribution of securities to investors outside of Canada. The Final Rule replaces Interpretation Note 1 Distributions of Securities Outside of Ontario, and is intended to bring greater certainty to cross-border activities in Ontario. The Final Rule has been delivered to the Minister of Finance for approval, and is expected to come into force on March 31, 2018. **Background:** Generally, the Final Rule provides exemptions from the prospectus requirement in respect of a distribution of securities to a person or company outside of Canada in the following circumstances: - if the distribution is under a public offering document in the US or a designated foreign jurisdiction; - if a concurrent distribution is qualified under a final prospectus in Ontario; - if the issuer is and has been a reporting issuer in a jurisdiction of Canada for the four months immediately preceding the distribution, and; - all other distributions, but subject to restrictions on resale to a person or company in a jurisdiction of Canada. The Final Rule also provides an exemption from the dealer and underwriter registration requirement in respect of a distribution of securities to a person or company outside of Canada on the following conditions: - the head office or principal place of business of the person or company is in the US, a designated foreign jurisdiction or Canada; - in the case of a distribution to a purchaser in the US the person or company is appropriately registered with the SEC and FINRA and complies with all applicable regulatory requirements; - in the case of a distribution to a purchaser located in a designated foreign jurisdiction, the person or company is registered in a category similar to a dealer in that jurisdiction and complies with all applicable regulatory requirements; - subject to a limited exception, the person or company does not carry on business as a dealer or underwriter from an office or place of business in Ontario; - other than the issuer or selling security holder, the person or company does not trade securities to, with or on behalf of anyone in Ontario, and; - the person or company relying on the exemption is not registered as a dealer in any jurisdiction of Canada. *The notice of adoption of OSC Rule 72-503 -Distributions Outside Canada, including Form 72-503F Report of Distributions Outside Canada and Companion Policy 72-503 Distributions Outside Canada,* is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20171221_72-503_rfc_distributions-outside-canada.htm) from the Ontario Securities Commission website. *OSC Rule 72-503 -Distributions Outside Canada, including Form 72-503F Report of Distributions Outside Canada and Companion Policy 72-503 Distributions Outside Canada,* is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20160630_72-503_rfc_distributions-outside-canada.htm) from the Ontario Securities Commission website. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Barbara Hendrickson quoted in the Lexis Nexis' The Lawyer's Daily article “Three technologies that will shake up the legal world in 2018."](https://baxsecuritieslaw.com/lawyers-daily-spoke-barbara-hendrickson-bax-securities-firms-strong-technology-practices-predictions-upcoming-year-legal-tech/) **Published:** January 6, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Lawyer’s Daily, spoke to Barbara Hendrickson of BAX Securities Law and other firms with strong technology practices about what their predictions were for the upcoming year in legal tech. Here's the link to the article that includes Barbara's comments and predictions on blockchain as... **Content:** The Lawyer’s Daily, spoke to Barbara Hendrickson of BAX Securities Law and other firms with strong technology practices about what their predictions were for the upcoming year in legal tech. Here’s the link to the article that includes Barbara’s comments and predictions on blockchain as well as other key legal technologies and the role they play. “The cloud, blockchain and artificial intelligence (AI) are the technologies predicted to play the biggest role in the legal world this year…” **To read the full article:** ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Barbara Hendrickson Appointed by the Ontario Securities Commission as New Member of the Securities Advisory Committee, January 15, 2018](https://baxsecuritieslaw.com/barbara-hendrickson-appointed-ontario-securities-commission-new-member-securities-advisory-committee-january-15-2018/) **Published:** January 16, 2018 **Author:** Barbara Hendrickson **Excerpt:** Congratulations to Barbara Hendrickson for her appointment to the Securities Advisory Committee (SAC).  Barbara is one of four new members that the Ontario Securities Commission (OSC) recently announced who will be participating on its Securities Advisory Committee for the next three years. The SAC provides advice... **Content:** Congratulations to Barbara Hendrickson for her appointment to the Securities Advisory Committee (SAC). Barbara is one of four new members that the Ontario Securities Commission (OSC) recently announced who will be participating on its Securities Advisory Committee for the next three years. The SAC provides advice to the Commission and staff on a variety of matters including legislative and policy initiatives and important capital markets trends and brings various issues to the attention of the Commission and staff. ![](../wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Ontario Securities Commission Publishes Proposed Changes to Whistleblower Program for Comment, February 4, 2018](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-proposed-changes-whistleblower-program-comment-february-4-2018/) **Published:** February 5, 2018 **Author:** Barbara Hendrickson **Excerpt:** On January 20, 2018, the Ontario Securities Commission (“OSC”) published proposed changes to OSC Policy 15-601, The Whistleblower Program (“Policy”) for a 60-day comment period, ending March 20, 2018 (“Notice”).   The Notice clarifies the role of in-house counsel and the exceptions from ineligibility so they... **Content:** On January 20, 2018, the Ontario Securities Commission (“**OSC**”) published proposed changes to *OSC Policy 15-601, The Whistleblower Program* (“**Policy**”) for a 60-day comment period, ending March 20, 2018 (“**Notice**”). The Notice clarifies the role of in-house counsel and the exceptions from ineligibility so they would not apply to in-house counsel in respect of matters that arise while the in-house counsel is acting in a legal capacity. The Policy, which came into effect in July 2016, provides guidance on the OSC’s Whistleblower Program (“**Program**”). The Program is designed to encourage individuals to report and submit to the OSC information on serious securities-related misconduct. Under the Program, individuals who meet certain eligibility criteria and who voluntarily submit ‘original information’ to OSC staff regarding a breach of Ontario securities law may be eligible for financial compensation (whistleblower award), depending if the information submitted meets these criteria: - If the information was of meaningful assistance to Staff in investigating the matter and obtaining a decision of the Commission under section 127 of the *Securities Act* (Ontario) (the Act) or section 60 of the *Commodity Futures Act* (Ontario) (the CFA); and, - results in an order for monetary sanctions (i.e., administrative penalties and/or disgorgement orders) and/or voluntary payments of $1,000,000 or more. The Policy also sets out the practices generally followed by the OSC Staff in administering the Program; the nature of the information that may be eligible for the payment of a whistleblower award and the criteria that would make an individual eligible for a whistleblower award; and the factors considered in determining eligibility for, and the amount of, a whistleblower award. The Policy is not intended to override applicable provincial or territorial bar or law society rules or equivalent rules applicable in another jurisdiction or to incent misconduct on the part of in-house counsel. It has provisions that are intended to protect against conduct that would violate a lawyer’s professional obligations: - the definition of ‘original information’ that may qualify for a whistleblower award expressly excludes information that a whistleblower has obtained through a communication that was subject to solicitor-client privilege; - subsection 14(3) of the Policy provides that no whistleblower award will be provided for information that Staff determines is subject to solicitor-client privilege; - subsection 15(1) of the Policy provides that a lawyer will generally be considered ineligible for a whistleblower award unless the disclosure of the information would otherwise be permitted by the lawyer under applicable provincial or territorial bar or law society rules or equivalent rules applicable in another jurisdiction (see s. 15(1) (c) and (d)). (This reflects that fact that in some jurisdictions disclosure by a lawyer may now or in the future be permitted under applicable law society rules or the equivalent.); and - Part 4, item F of the Whistleblower Submission Form A requires in-house counsel to state whether disclosure of the information he or she is providing is permitted under applicable provincial or territorial bar or law society rules or the equivalent rules applicable in another jurisdiction. The Policy contains exceptions from ineligibility for certain otherwise ineligible classes of individuals. They may be eligible for a whistleblower award if they fall within one or more of the exceptions set out in subsection 15(2) of the Policy, as follows: - the whistleblower has a reasonable basis to believe that disclosure of the information to the Commission is necessary to prevent the subject of the whistleblower submission from engaging in conduct that is likely to cause or continue to cause substantial injury to the financial interest or property of the entity or investors; - the whistleblower has a reasonable basis to believe the subject of the whistleblower submission is engaging in conduct that will impede an investigation of the misconduct; or - at least 120 days have elapsed since the whistleblower provided the information to the relevant entity’s audit committee, chief legal officer, CCO (or their respective functional equivalents) or the individual’s supervisor, or, at least 120 days have elapsed since the whistleblower received the information, if in the circumstances the whistleblower received the information, the whistleblower became aware that one or more of those individuals were already aware of the information. The Notice states that the exceptions apply to in-house counsel in situations where the employee serves both legal and non-legal functions within an organization and provides a whistleblower submission that relates to matters that arise while the in-house counsel is acting outside of their legal capacity. The proposed changes: - spells out that the exceptions arising from ineligibility in subsection 15(2) of The Policy would not apply to in-house counsel while the in-house counsel is acting in a legal capacity. This change also further affirms the fact OSC staff do not wish to receive information that is subject to solicitor-client privilege or the provision of which would otherwise be in breach of applicable provincial or territorial bar or law society rules or equivalent rules applicable in another jurisdiction. - further clarifies that in Ontario, in-house counsel acting in a legal capacity are ineligible for a whistleblower award because their duty to protect the confidentiality of their clients’ information would preclude them from making a whistleblower submission under the rules governing the legal profession in the province. The OSC notes that in some jurisdictions legal counsel are not prohibited from reporting client misconduct and in fact, may be required to report it. It also advises that when the proposed changes come into force, in-house counsel acting in a legal capacity will be ineligible for an OSC whistleblower award unless the disclosure would otherwise be permitted under applicable law society rules. The proposals in the Notice should be read with the amendments introduces last November by the Government of Ontario provide for a civil cause of action for whistleblowers who experience a reprisal for cooperating with the OSC. The Ontario *Securities Act* and the *Commodity Futures Act* were amended to provide a civil cause of action for whistleblower who experience reprisals including the whistleblower being able to bring an action in the Superior Court of Justice or bring a complaint to be resolved by binding arbitration. The notice of publication of proposed changes to *OSC Policy 15-601, The Whistleblower Program,* is [available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20180118_15-601_rfc-whistleblower-program.htm) from the Ontario Securities Commission website. *OSC Policy 15-601, The Whistleblower Program,* is [available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20151028_15-601_policy-whistleblower-program.htm) from the Ontario Securities Commission website. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [British Columbia Securities Commission Publishes BC Notice 28/01, Notice and Request for Comment Consulting on the Securities Law Framework for Fintech Regulation](https://baxsecuritieslaw.com/british-columbia-securities-commission-publishes-bc-notice-28-01-notice-request-comment-consulting-securities-law-framework-fintech-regulation/) **Published:** February 26, 2018 **Author:** Barbara Hendrickson **Excerpt:** On February 14, 2018, the British Columbia Securities Commission (BCSC) published for comment BC Notice 28/01, Notice and Request for Comment Consulting on the Securities Law Framework for Fintech Regulation (the Notice), with the aim of understanding the nature and growth of the financial technology... **Content:** On February 14, 2018, the British Columbia Securities Commission (BCSC) published for comment *BC Notice 28/01, Notice and Request for Comment Consulting on the Securities Law Framework for Fintech Regulation* (the Notice), with the aim of understanding the nature and growth of the financial technology (fintech) industry in British Columbia. The Notice sets out the result of consultations with stakeholders that the BCSC held in the Summer of 2017 and seeks comment on potential regulatory action to clarify or modernize securities laws to benefit all stakeholders, including investors in fintech. The Notice identifies specific subjects and poses a series of questions for comment and discussion regarding fintech and fintech regulation, with the aim of developing a competitive regulatory environment that fosters innovation and gives investors the confidence to invest in British Columbia’s capital markets. This update will examine in detail at two parts of the Notice: Part Five, Cryptocurrency Funds and Part Six, Initial Coin Offerings and Cryptocurrencies. The complete Notice [is available for download](https://www.bcsc.bc.ca/BCN_2018_01_02142018/) from the BCSC’s website. **Part Five: Cryptocurrency Funds:** In Part Five, BCSC staff noted that as cryptocurrency use increases, they expect continued registration applications from fund managers looking to operate cryptocurrency investment funds. These may range from investments in established cryptocurrencies such as bitcoin and ethereum, to investing in speculative cryptocurrencies that may have other functionalities. These funds may also look to invest in ICOs and initial token offerings (ITOs). Staff identified the following areas that could merit further regulatory consideration: *Risk management for cryptocurrency investment funds:* The BCSC is studying how to best mitigate the risks posed by cryptocurrencies, including those identified in [CSA Staff Notice 46-307](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170824_cryptocurrency-offerings.htm) (the CSA Staff Notice). These risks range from the operational (e.g. the risks associated with using specific cryptocurrency exchanges, cryptocurrency wallets and custodians; difficulties in determining a fair price for a cryptocurrency transaction) to the systemic (e.g. the lack of regulation of cryptocurrencies overall; the lack of transparency in cryptocurrency trading). *Incoming changes to custody requirements in NI 31-103:* BCSC staff also examined the impact on cryptocurrencies of the proposed [amendments for NI 31-103](http://www.osc.gov.on.ca/en/SecuritiesLaw_20170727_31-103_amendments.htm) (the Amendments), which are expected to come into force on June 4, 2018. The Amendments will impose requirements on registrants regarding custody of client cash, securities or other assets and will set out additional requirements for external custodians used by registered firms to hold cash or securities. The Amendments also set specified restrictions on self-custody of cash and securities for registrants. The requirements for custody of client assets that are not cash or securities will remain essentially unchanged. *Investment and operational concerns for cryptocurrency investment funds:* The BCSC is also studying the implications of the CSA Staff Notice, more specifically whether funds investing in ICOs may give rise to additional concerns such as: - if the fund’s assets include securities (which could include coins or tokens), the fund would need a registered PM to oversee its investment activities. - coins or tokens that are securities may be subject to resale restrictions, adding liquidity risks to the fund. - as market participants must evaluate each cryptocurrency offering on a case-by-case basis, a fund could incur significant risks if it invests in an ICO before there is clarity on whether the ICO is a distribution of securities. For instance, if an investment manager for a fund is not a registered PM and causes the fund to invest in an ICO that is later determined to be a distribution of securities, that investment manager would have advised the fund on securities without being properly registered. This may result in sanctions against the investment manager or the fund, such as a cease trade order of the securities. *Operational requirements for cryptocurrency funds:* In addition, BCSC staff are also are considering whether operational requirements for cryptocurrency investment funds should differ from requirements for other types of funds. There has been some stakeholder concern raised that the proficiency and operational requirements for advisers and IFMs may not be pertinent to cryptocurrencies. **Part Six: ICOs and Cryptocurrencies:** In opening this section, the BCSC refers to the CSA Staff Notice, in which CSA (Canadian Securities Administrators) staff notes the increase in ICOs and ITOs. (The term ICO used here includes the distribution of coins or tokens, but can also refer to an initial token offering, token generation event, or token distribution event.) *Exemptive Relief Decisions for ICOs:* Since August 2017, the CSA has granted exemptive relief to two businesses proposing to conduct ICOs. The relief granted consisted of: - in both cases, dealer registration relief that provided for the ICO coins or tokens to be distributed using prospectus exemptions; and, - in one case, prospectus relief, to facilitate the tokens’ circulation in a defined ecosystem as a form of currency. The relief allowed these novel businesses to raise capital with tailored restrictions. The prospectus relief demonstrates the regulators’ willingness to consider a flexible approach to tokens with unique characteristics, if investor protection concerns are adequately addressed. *ICOs as a distribution of securities:* In the CSA Staff Notice, the CSA noted that in many cases, the determination of whether a coin or token is a security depends on whether it is an investment contract. However, BCSC staff have received requests for additional stakeholder guidance on the factors that staff consider in determining whether an ICO is an offering of securities. Stakeholders have identified the following list of variables as potential factors to consider whether an investment contract exists with a given ICO: - Whether a secondary market exists and is available for a coin or token. For example, tokens compliant with the Ethereum standard ERC-20 are structured in a way that makes them readily tradable on many cryptocurrency exchanges. This may increase the potential for speculation in a token. - Whether a buyer is intending to use a coin or token for a utility function or speculation. Sellers of tokens often purport that there is a “utility” function to the token that constitutes the reason for its purchase, that is separate from its potential function as an investment. However, tokens are often traded from the time they are sold, indicating that buyers may be treating the token as a speculative instrument without an intention to participate in its future utility. BCSC staff also note instances of futures trading for some tokens prior to their distribution under an ICO. - Functional differences to forms of non-securities crowdfunding. Stakeholders argue that many businesses proposing ICOs use a coin or token in a manner similar to a prepayment of a good or service. However, we have observed that some ICOs issue coins or tokens that are readily tradable with an available secondary market, unlike the standard lack of transferability observed with prepaid promises to deliver under non-securities crowdfunding platforms such as Kickstarter. - Whether the utility function is available at the time the tokens are sold. Most businesses that conduct ICOs are prospective and looking to raise capital to build out the utility function for the token. However, it has been argued that where some businesses have already built out the product for which the tokens are needed, the token may be less of a speculative instrument compared to a token whose utility function is not available at the time the token is sold. - Whether the business conducting the ICO has created an impression that the token is an investment or profit opportunity. ICOs are conducted through the internet and can attract a wide range of potential buyers. Where a business is offering tokens and indicates that such token may generate positive returns for a buyer outside its use, the business may be creating the impression that such coin or token is actually an investment instead of a token with a specific use. This promotional aspect may be observed even where the business is separately asserting that the token is intended to be used for a utility function. BCSC staff note that this list may not encompass all the factors that they may wish to consider. *Proposed ICO models:* The most common ICO model, noted the BCSC, is where a business raises capital by selling non-functional tokens and uses those proceeds to develop the functionalities it advertised for that token. The business issues the non-functional tokens immediately to purchasers following the ICO. Staff do add however, that other proposed or in-use ICO models used by business include: - an ICO structured so that one token is a security used for capital raising prior to the development of the platform, and a second, functional token is used for deployment once the platform is operational; - an ICO where the developer delays release of the token to a later time, such as once the platform is functional; and, - an ICO in which the first step involves the purchasers and developer entering into an agreement for the right to a functional token, and then a second step involves fulfilment of the agreement by releasing the token when the platform/ecosystem is functional. BCSC staff note when considering a transaction, they look at the substance of a transaction, and not simply its form. However, they also advise that the choice of ICO model that a business uses may affect the legal analysis of whether there is a distribution of securities. *Securities Regulatory Approach to Virtual Currencies:* Financial regulators are monitoring and taking varying approaches to respond to the challenges posed by virtual currencies. The BCSC defines a “virtual currency” as meaning a cryptocurrency purported to function solely as a medium of exchange, without any added utility or purpose (e.g. bitcoin). There have been arguments made that virtual currencies fail the investment contract test when they are highly decentralized. For these virtual currencies it is argued there is no common enterprise, and no expectation of profit that relies on the significant efforts of others. Stakeholders have identified the following additional factors securities regulators should consider in determining when a virtual currency is not an investment contract, and therefore not a security: - No central governance for the coin. For example, bitcoin has no entity or entities with authority to set rules applicable to the coin on an ongoing basis; - Creation or distribution of coins not dependent on a central issuer. For example, new coins could be created or distributed through mining, staking or other decentralized forms of coin creation/distribution; and, - Transfer and trading of coins not dependent on a central party. There are no restrictions on who may record new transactions on the blockchain ledger for the coin, and there is no central entity that can influence which transactions occur. *BC Notice 28/01, Notice and Request for Comment Consulting on the Securities Law Framework for Fintech Regulation*, is [available for download](https://www.bcsc.bc.ca/BCN_2018_01_02142018/) from the British Columbia Securities Commission website. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Canadian Securities Administrators Propose Changes to the Syndicated Mortgage Regime](https://baxsecuritieslaw.com/canadian-securities-administrators-propose-changes-syndicated-mortgage-regime/) **Published:** March 11, 2018 **Author:** Barbara Hendrickson **Excerpt:** On March 8, 2018, the Canadian Securities Administrators (CSA) published for a 90-day comment period ending June 6, 2018, proposed changes aimed at substantially harmonizing the regulatory framework for syndicated mortgages in Canada. These changes are detailed in the proposed amendments to National Instrument 45-106... **Content:** On March 8, 2018, the Canadian Securities Administrators (CSA) published for a 90-day comment period ending June 6, 2018, proposed changes aimed at substantially harmonizing the regulatory framework for syndicated mortgages in Canada. These changes are detailed in the proposed amendments to *National Instrument 45-106 Prospectus* *Exemptions and National Instrument 31-103 Registration Requirements, Exemptions and Ongoing* *Registrant Obligations* (the Proposed Amendments), as well as changes to *Companion Policy 45-106CP Prospectus* *Exemptions* (the Proposed Changes). The Proposed Amendments will introduce additional investor protections related to the distribution of syndicated mortgages and will increase harmonization regarding the regulatory framework for syndicated mortgages across all CSA jurisdictions, while the Proposed Changes will provide guidance regarding the new requirements introduced by the Proposed Amendments and regarding the determination of the issuer of a syndicated mortgage. All CSA jurisdictions currently have prospectus and registration exemptions for securities that are mortgages (the Mortgage Exemptions) if they are sold by a mortgage broker licensed in the Canadian jurisdiction where the property is located. In Alberta, British Columbia, Manitoba, New Brunswick, Québec and Saskatchewan, the Mortgage Exemptions are not available for syndicated mortgages. The Proposed Amendments include changes to the prospectus and registration exemptions available for the distribution of syndicated mortgages. In particular, the Proposed Amendments: - Remove the prospectus and registration exemptions under sections 2.36 of [NI 45-106](http://www.osc.gov.on.ca/en/15126.htm) and 8.12 of [NI 31-103](http://www.osc.gov.on.ca/en/SecuritiesLaw_31-103.htm), respectively for the distribution of syndicated mortgages in the CSA jurisdictions where the exemptions are available; - Introduce additional requirements to the offering memorandum exemption under section 2.9 of NI 45-106 (the OM Exemption) that apply when the exemption is used to distribute syndicated mortgages; and, - Amend the private issuer prospectus exemption under section 2.4 of NI 31-103 (the Private Issuer Exemption) so that it is not available for the distribution of syndicated mortgages. **Background:** A syndicated mortgage is defined by CSA staff as a mortgage in which two or more persons participate, either directly or indirectly, as lenders in the debt obligation that is secured by the mortgage. Over the last number of years, there has been what CSA staff term “a significant increase” in the offering of syndicated mortgages in certain jurisdictions in connection with real estate development. These offerings are often sold to retail investors and in that light, says CSA staff, they potentially raise investor protection concerns because they may: - be used to raise seed financing for real estate developments, such as the costs of initial design proposals and start-up expenses; - be sold based on projected values of a completed development; - not be fully secured by a charge against real property, since the amount of the loan may significantly exceed the current fair value of the land; - be subordinate to future financings, such as construction financing, which may be substantial and effectively render the investment more similar in risk to an equity investment rather than a fixed income investment; - be offered by issuers with no source of income, rendering the payment of ongoing interest dependent on future financing or reserves from the principal advanced; and, - be subject to the risk of delay and increased costs inherent to real estate development. **Summary of Proposed Changes:** *Changes to the Mortgage Exemptions:* Consistent with the current approach in Alberta, British Columbia, Manitoba, New Brunswick, Québec and Saskatchewan, the Proposed Amendments, together with related legislative amendments in Ontario, would remove the Mortgage Exemptions for syndicated mortgages in Newfoundland and Labrador, the Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island and Yukon. Under the Proposed Amendments, alternative prospectus exemptions will be required for the distribution of syndicated mortgages in all CSA member jurisdictions. CSA staff expect that syndicated mortgages will most likely be offered primarily under the Accredited Investor Exemption under section 2.3 of NI 45-106 (the AI Exemption), the OM Exemption or the Family, Friends and Business Associates Exemption under section 2.5 of NI 45-106 (the FFBA Exemption), although other prospectus exemptions may be available. In those jurisdictions where the Mortgage Exemption already applies to syndicated mortgages, market participants engaged in their trading would be required to consider whether the registration requirement applies to them. Since some of these firms are usually engaged in repeat rounds of financing activities, CSA staff expect that they will either will be required to become registered as a dealer or will have to rely on a registration exemption. *Changes to the Offering Memorandum Exemption:* The OM Exemption allows for the distribution of syndicated mortgages to retail investors based on the premise that adequate disclosure being provided to potential investors. In the marketing of these offerings, mortgage syndicators often stress the projected value of the completed development and the fact that the syndicated mortgage is secured against real property. The protection provided by this security interest, however, depends primarily on the current fair market value of the real property relative to the obligations and any prior ranking charges. Issuers will still be allowed to distribute syndicated mortgages under the OM Exemption, but under the Proposed Amendments, will face more stringent disclosure requirements. Issuers will have to deliver a current fair market value appraisal of the of the property that is the subject of the syndicated mortgage to potential investors. The appraisal must be prepared by a qualified third-party appraiser independent of the issuer. Any other valuation of the property disclosed by the issuer would be required to have a reasonable basis in fact. The issuer will also be required to disclose any and all material factors and assumptions underlying that value and whether the valuation was prepared by a qualified appraiser who is also independent of the issuer. Consistent with the current approach in British Columbia, the Proposed Amendments also include supplemental disclosure requirements for syndicated mortgages, including disclosure of development risks, prior obligations secured against the real property and the price paid by the developer to acquire the real property. The intention of these amendments is to require adequate information for: - potential purchasers under the OM Exemption to make an informed investment decision; and, - any registrants involved in the distribution to discharge their obligations to know the product being offered and to conduct a meaningful analysis of the suitability of the investment. Issuers of syndicated mortgages would be required to meet the requirements of Form 45-106F2 *Offering Memorandum for Non-Qualifying Issuers,* as supplemented by proposed Form 45-106F18 *Supplemental Offering Memorandum Disclosure for Syndicated Mortgages*. The new disclosure requirements include information regarding the business and financial position of the borrower under the syndicated mortgage. While CSA staff expect that the issuer and borrow will generally be the same entity, in circumstances where the issuer of the syndicated mortgage is not the borrower, its ability to rely on the OM Exemption will depend on its ability to provide the required information regarding the borrower and to certify that it does not contain a misrepresentation. The CSA considers information regarding the borrower to be essential since the borrower will be required to make payments of principal and interest under the syndicated mortgage. Any mortgage broker involved in the distribution of a syndicated mortgage under the OM Exemption would also be required to provide a certificate stating the offering memorandum does not contain a misrepresentation with respect to matters within its knowledge and that the mortgage broker has made best efforts to ensure that matters that are not within its knowledge do not contain a misrepresentation. While the latter is a current regulatory requirement in British Columbia, in some other jurisdictions a person who certifies an offering memorandum is subject to the statutory right of action for purchasers if the offering memorandum contains a misrepresentation. *Removal of the Private Issuer Exemption:* The Proposed Amendments would remove the availability of the Private Issuer Exemption for the distribution of syndicated mortgages. The CSA staff believes that the Private Issuer Exemption, intended for small businesses to raise capital, is not appropriate for products such as syndicated mortgages. CSA staff believe that the with the continued availability of the FFBA Exemption and the AI Exemption, this proposed amendment should not significantly restrict the range of potential purchasers for syndicated mortgages. By removing the Private Issuer Exemption for syndicated mortgages, CSA staff believe this would result in more consistent reporting for syndicated mortgage distributions through the report of exempt distribution. **Impact on Investors** CSA staff expects that investors in syndicated mortgages who purchase under the amended OM Exemption would be entitled to enhanced disclosure relating to their investment. The expectation by the CSA is that this will result in more informed investment decisions by investors and enable registrants involved in the distribution to better fulfill their obligations related to the distribution. CSA staff also note that investors in syndicated mortgages distributed under other prospectus exemptions will also benefit from the potential involvement of a registrant in the distribution, in the same manner as for the distribution of other real estate-related securities. *CSA Notice and Request for Comment Proposed Amendments to National Instrument 45-106 Prospectus Exemptions and National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations relating to Syndicated Mortgages and Proposed Changes to Companion Policy 45-106CP Prospectus Exemptions*, is [available for download](https://www.bcsc.bc.ca/Securities_Law/Policies/Policy4/PDF/CSA_Notice_and_Request_for_Comment__March_8__2018/) from the websites of the participating jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Barbara Hendrickson recently interviewed by Law Times on the topic of a national securities regulator](https://baxsecuritieslaw.com/potential-national-securities-regulator-raises-concerns/) **Published:** March 12, 2018 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson recently interviewed by Law Times on the topic of the skepticism around the plan of creating one national securities regulator. Read the full article here: A potential national securities regulator raises concerns **Content:** Barbara Hendrickson recently interviewed by Law Times on the topic of the skepticism around the plan of creating one national securities regulator. Read the full article here: [A potential national securities regulator raises concerns](http://www.lawtimesnews.com/author/dale-smith/a-potential-national-securities-regulator-raises-concerns-15414/) **Categories:** News & Updates --- ### [Ontario Securities Commission publishes OSC Staff Notice 11-779 Seniors Strategy](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-osc-staff-notice-11-779-seniors-strategy/) **Published:** March 26, 2018 **Author:** Barbara Hendrickson **Excerpt:** On March 20 2018, the Ontario Securities Commission published OSC Staff Notice 11-779 Seniors Strategy (the Staff Notice), which outlined new initiatives to respond to the needs of older investors and better equip registered firms and representatives to address issues that may arise as their... **Content:** On March 20 2018, the Ontario Securities Commission published *OSC Staff Notice 11-779 Seniors Strategy* (the Staff Notice), which outlined new initiatives to respond to the needs of older investors and better equip registered firms and representatives to address issues that may arise as their clients age. The Staff Notice has its origins in a 2017 Government of Ontario document, *Aging with Confidence,* which was an action plan dealing with the challenges faced by Ontario’s seniors. The OSC’s Seniors Strategy (the Strategy) was an outgrowth of the action plan, with the goal of a more secure financial future for older investors in Ontario. **Key Elements:** The key elements of the Strategy include: - Developing a framework to address issues of financial exploitation and cognitive impairment among older investors, which includes: - a requirement that registered firms and their representatives make reasonable efforts to obtain the name and contact information for a client’s “trusted contact person” in case of concerns over a client’s behaviour or transactions in their account; - enabling registered firms and their representatives (for example, through a safe harbour) to place a temporary hold on disbursements from a client’s account or make a disclosure to a trusted contact person when they have a reasonable belief that financial exploitation or fraud has occurred, is occurring, or will be attempted or have a reasonable belief that a client’s judgement may be impaired; - guidance for registered firms and their representatives when engaging with older clients, such as collecting sufficient information about a client, supervising client accounts and communicating effectively with clients and supporting their decision making as they age. - Addressing registered firms’ and their representatives’ use of confusing and misleading titles, designations, and marketing practices, including issues related to older investors. - Strengthening the OBSI (Ombudsman for Banking Services and Investments) and exploring how the dispute resolution process can better respond to the issues of older investors. - Working with other regulators and organizations toward a common goal of designing policies and programs that serve the interests of older individuals in areas such as powers of attorney and privacy laws. - Enhancing the OSC’s education and outreach activities to provide tools and resources for older investors, their families and caregivers who support them, as well as their registered firms and representatives, and improving the ways in which it delivers information through written materials, digital publications and in-person engagement. *OSC Staff Notice 11-779 Seniors Strategy* and the attached whitepaper is [available for download](http://www.osc.gov.on.ca/en/NewsEvents_nr_20180320_osc-outlines-initiatives-ontario-seniors.htm) from the Ontario Securities Commission website. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Twitter Blocks Initial Token Offering Advertising](https://baxsecuritieslaw.com/twitter-blocks-initial-token-offering-advertising/) **Published:** March 28, 2018 **Author:** Barbara Hendrickson **Excerpt:** On March 28 2018, in an effort to stop online fraud being carried out through its social networking service, Twitter began blocking all advertisements promoting Initial Token Offerings (ITOs). ITOs also referred to as an Initial Coin Offerings (ICOs), are similar to Initial Public Offerings... **Content:** On March 28 2018, in an effort to stop online fraud being carried out through its social networking service, Twitter began blocking all advertisements promoting Initial Token Offerings (ITOs). ITOs also referred to as an Initial Coin Offerings (ICOs), are similar to Initial Public Offerings (IPOs), in that they are used to raise capital from investors. However, there are some major differences. An ITO/ICO is typically open for a set period, during which investors can visit a website to purchase coins/tokens in exchange for fiat currency or a cryptocurrency such as Bitcoin or Ethereum. The structures of ITOs/ICOs will vary, and they may be used to raise capital for a variety of projects. Anyone with internet access can create or invest in an ITO/ICO; in many cases, they can do so anonymously. The very nature of ITOs/ICOs has left potential investors open to the risk of online fraud. Twitter had previously identified the issue and had promised to crack down on users or bot accounts seeking cryptocurrencies from other users of the social networking site. The ban extends to all ads related to ITOs/ICOs, token sales, exchanges, and wallet services but excludes public companies listed on major stock markets. Twitter’s move follows earlier similar announcements by Facebook to ban cryptocurrency advertising on its social networking site and by Google to restrict certain forms of cryptocurrency-related advertising. This move has come in the wake of stepped-up efforts by regulators such as the Canadian Securities Administrators (CSA) to [monitor and regulate cryptocurrencies and ITOs/ICOs](http://www.osc.gov.on.ca/documents/en/Securities-Category4/csa_20170824_cryptocurrency-offerings.pdf). 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Ontario Securities Commission Probing Cryptocurrency Trading Platforms Following Complaints](https://baxsecuritieslaw.com/barbara-hendrickson-recently-spoke-on-a-panel-organized-by-the-ryerson-law-network-on-the-topic-of-crypto-law-securities-law-practice-march-8-2018/) **Published:** April 6, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) announced today it is investigating several cryptocurrency platforms after receiving a number of complaints. The OSC said that the platforms and any businesses that allow cryptocurrencies that are securities as defined under CSA Staff Notice 46-307 Cryptocurrency Offerings (the Staff... **Content:** The Ontario Securities Commission (OSC) announced today it is investigating several cryptocurrency platforms after receiving a number of complaints. The OSC said that the platforms and any businesses that allow cryptocurrencies that are securities as defined under *CSA Staff Notice 46-307 Cryptocurrency Offerings* (the Staff Notice), to trade on them, may be operating outside securities law. The OSC warns that any cryptocurrency-based trading platform must define themselves as marketplaces and follow the same rules as other marketplace exchanges. The OSC also notes that no platforms to-date have been recognized as an exchange or have exempted from recognition. This action by the OSC comes after the recent launch of a numerous ITOs (Initial Token Offerings) and ICOs (Initial Coin Offerings), which may be used by companies as an alternative way to raise funds. With little regulation, however, ITOs/ICOs have also raised worries about possible financial scams. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Canadian Securities Administrators Issue Report on Climate Change-Related Disclosure Project](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-report-on-climate-change-related-disclosure-project/) **Published:** April 6, 2018 **Author:** Barbara Hendrickson **Excerpt:** On April 5, 2018, the Canadian Securities Administrators (CSA) published CSA Staff Notice 51-354 Report on Climate change-related Disclosure Project (The Staff Notice). The Staff Notice summarizes the results of the CSA's review of the disclosure by reporting issuers of the risks and financial impacts associated... **Content:** On April 5, 2018, the Canadian Securities Administrators (CSA) *published CSA Staff Notice 51-354 Report on Climate change-related Disclosure Project* (The Staff Notice). The Staff Notice summarizes the results of the CSA’s review of the disclosure by reporting issuers of the risks and financial impacts associated with climate change and outlines its plans for future work. The focus on climate change-related issues in Canada and around the world has grown rapidly in recent years. Various stakeholders are seeking improved disclosure of the material risks, opportunities, financial impacts and governance processes related to climate change and in response to a changing regulatory environment as illustrated by federal government’s pan-Canadian framework on clean growth and climate change and by its commitment under the Paris Agreement to reduce greenhouse gas (GHG) emissions, including by 30% below 2005 levels by 2030. As a result, on March 21, 2017, the CSA announced a project to review the disclosure of risks and financial impacts to issuers associated with climate change, and the governance processes related to them (the Project). The Project was focused on climate change-related risks and opportunities that impact an issuer and its business, as opposed to the impact an issuer has or may have on climate change. The objectives of the Project were: - to assess whether current securities legislation in Canada and guidance are sufficient for issuers to determine what climate change-related disclosures they should provide; - to better understand what climate change-related information investors need in order to make informed voting and investment decisions, and; - to see whether or not issuers are providing appropriate disclosures in this regard. In the process of carrying out the project, CSA staff identified a number of key themes arising out of the Project, which include: - a better understanding of Canadian issuers’ current disclosure practices in relation to climate change-related information; and, - an insight into users’ and issuers’ perspectives on the materiality of climate change-related risks and opportunities and the associated financial impacts. During the course of the Project, CSA staff held a number of consultations with stakeholders. Staff sought to understand their disclosure needs, whether those needs were being met by issuers, and their suggestions for improvement. Staff consulted with issuers with respect to their interactions with users of climate change-related information, as well as the challenges involved in identifying climate change-related risks and opportunities, quantifying impacts, and preparing meaningful disclosure of material information. The CSA has identified a series of next steps stemming from the Project. They include: - developing guidance and educational initiatives which are useful to issuers across a wide range of industries with respect to the business risks and opportunities and potential financial impacts of climate change; - considering new disclosure requirements regarding corporate governance in relation to business risks, including climate change-related risks, and risk oversight and management; and, - monitoring the quality of issuers’ disclosure and the evolution of best disclosure practices in this area, to assess whether further work needs to be done to ensure that Canadian issuers’ disclosure continues to develop and improve; - determining whether investors require additional types of climate change-related disclosure to make investment and voting decisions; and, - monitoring developments in reporting frameworks, evolving disclosure practices and investors need for additional types of climate change-related disclosure to make investment and voting decisions, including whether disclosure requirements in relation to GHG emissions are warranted in the future. *CSA Staff Notice 51-353 Update on CSA Staff Notice 51-354 Report on Climate change-related Disclosure Project* is [available for download](https://www.bcsc.bc.ca/51-354_%5bCSA_Staff_Notice%5d_04052018/) from the websites of participating jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Investment Canada Act Regulates Significant Foreign Investments in Canada](https://baxsecuritieslaw.com/investment-canada-act-regulates-significant-foreign-investments-in-canada/) **Published:** April 7, 2018 **Author:** Janny Cho **Excerpt:** *Article available in English and Chinese – The Investment Canada Act regulates non-Canadian investments in Canadian businesses, including reviewing significant non-Canadian investments in Canada in order to ensure net benefit to Canada and reviewing and blocking foreign investments that may be injurious to national security.... **Content:** \*Article available in English and Chinese – The Investment Canada Act regulates non-Canadian investments in Canadian businesses, including reviewing significant non-Canadian investments in Canada in order to ensure net benefit to Canada and reviewing and blocking foreign investments that may be injurious to national security. [Read the full article here](../wp-content/uploads/2018/04/Bax_InvestmentCanAct_march2018-2.pdf) 《加拿大投资法》对外国人在加拿大进行大型投资的规管 撰文: 曹静怡律师 | 2018-01-29 非加拿大人在加拿大的企业投资行为要受到 Investment Canada Act《加拿大投资法》的规管。该法案规定：加拿大政府需审核非加拿大人在加拿大进行的大型投资，以确保其不会妨碍加拿大的“整体利益”。此外，政府还会审核并阻止任何可能“危害加拿大国家安全”的投资。[阅读全文](../wp-content/uploads/2018/04/BAX-investment-Canada-Act-chinese-versionF.pdf) **Categories:** News & Updates --- ### [How to Raise Capital by “Going Public” in Canada](https://baxsecuritieslaw.com/how-to-raise-capital-by-going-public-in-canada/) **Published:** April 7, 2018 **Author:** Janny Cho **Excerpt:** *Article available in English and Chinese – Companies can raise funds from investors by “going public. ̋ “Going public” means offering equity securities to the public. A distribution of securities must be qualified by a prospectus that is approved by the relevant securities regulators,... **Content:** \*Article available in English and Chinese – Companies can raise funds from investors by “going public. ̋ “Going public” means offering equity securities to the public. A distribution of securities must be qualified by a prospectus that is approved by the relevant securities regulators, unless an exemption applies. Different listing requirements apply to companies in different industries. ”. [Read the full article here.](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/04/BAX-Going-Public-in-Canada-English-version.pdf) 如何筹集资金? — 在加拿大“上市” 撰文: 曹静怡律师 | 2018-02-05 为向投资者筹集资金, 公司可以安排 证券“上市”。上市”是指向公众提供股票证券。 除非經法規豁免，经相关证券监管机构批准的招股说明书是证券發行的必备部分。申請上市的公司需符合該行業的上市要求。[阅读全文:](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/04/BAX-Going-Public-in-Canada-Chinese-version-F.pdf) **Categories:** News & Updates --- ### [Canadian Anti-Money Laundering Legislations Target Proceeds of Crime and Terrorist Financing](https://baxsecuritieslaw.com/canadian-anti-money-laundering-legislations-target-proceeds-of-crime-and-terrorist-financing/) **Published:** April 7, 2018 **Author:** Janny Cho **Excerpt:** *Article available in English and Chinese – Criminals often make the funds gained from their illegal activities appear legitimate by money laundering. In contrast, terrorist financing provides funds for terrorist activities, which may involve funds raised from legitimate and/or criminal sources. Canadian anti-money laundering legislations... **Content:** \*Article available in English and Chinese – Criminals often make the funds gained from their illegal activities appear legitimate by money laundering. In contrast, terrorist financing provides funds for terrorist activities, which may involve funds raised from legitimate and/or criminal sources. Canadian anti-money laundering legislations focus on detecting, deterring, investigating and prosecuting money laundering and terrorist financing activities. [Read the full article here](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/04/BAX-Anti-Money-Laundering-Article-English-version.pdf) 《加拿大反洗钱法》针对犯罪收益和恐怖融资 撰文: 曹静怡律师 | 2018-03-07 犯罪分子经常通过洗钱掩饰、隐瞒从非法活动中获得资金的来源和性质, 试图令资金合法化。此外，恐怖融资是指为恐怖活动提供资金，而该资金的筹集来源涉及合法和/或犯罪的性質。加拿大反洗钱法侧重于侦查，制止，调查和起诉洗钱和恐怖融资活动。[阅读全文:](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/04/BAX-Anti-Money-Laundering-Article-Chinese-version-F.pdf) **Categories:** News & Updates --- ### [Ontario Securities Commission Establishes Permanent Mediation Program](https://baxsecuritieslaw.com/ontario-securities-commission-establishes-permanent-mediation-program/) **Published:** April 11, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) announced today that its Mediation Program, which began as a pilot in 2015, will now continue on a permanent basis. The Mediation Program, the first and only of its kind in Canada offered by a securities regulator provides a forum... **Content:** The Ontario Securities Commission (OSC) announced today that its Mediation Program, which began as a pilot in 2015, will now continue on a permanent basis. The Mediation Program, the first and only of its kind in Canada offered by a securities regulator provides a forum for respondents who are represented by counsel and enforcement staff involved in OSC enforcement proceedings with an option to seek a resolution through an independent third-party mediator. The goal of the program is to resolve outstanding enforcement matters in a timely, efficient and cost-effective way. According to CSA staff, the Mediation Program has been successful in achieving these aims. The program allows a mediator, selected from a published roster, to help facilitate the negotiation of settlement terms, an agreed statement of facts, and resolve other enforcement issues. The program is generally available to any respondent, and the OSC encourages its use at the earliest opportunity. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Canadian Securities Administrators Seek Comment on Soliciting Dealer Arrangements](https://baxsecuritieslaw.com/canadian-securities-administrators-seek-comment-on-soliciting-dealer-arrangements/) **Published:** April 15, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published for comment CSA Staff Notice 61-303 and Request for Comment Soliciting Dealer Arrangements (The Staff Notice). The Staff Notice outlines regulatory issues raised by soliciting dealer arrangements and seeks input on the practice. The 60-day comment period ends... **Content:** The Canadian Securities Administrators (CSA) has published for comment *CSA Staff Notice 61-303 and Request for Comment Soliciting Dealer Arrangements* (The Staff Notice). The Staff Notice outlines regulatory issues raised by soliciting dealer arrangements and seeks input on the practice. The 60-day comment period ends June 11, 2018. Soliciting dealer arrangements may be used to solicit securities from securityholders to vote in connection with a matter requiring shareholder approval, or to tender securities for a takeover bid. These arrangements may also be used to incentivize dealers to contact securityholders to participate in a rights offering, to exercise rights to redeem or convert securities, or to attain the requisite quorum for amendments to documents affecting the rights of securityholders. Generally, the fees for soliciting dealer arrangements are subject to a minimum or maximum. In a number of cases, the payment of any fee is contingent on “success” and/or only if a securityholder votes in a particular manner (e.g., only “for” or only “against” a transaction). The CSA cites a number of recent instances of soliciting dealer arrangements in connection with contested director elections, with the most prominent examples being the 2013 proxy contest initiated by JANA Partners LLC for Agrium Inc. and the 2017 proxy contest initiated by PointNorth Capital Inc. for Liquor Stores N.S. Ltd. In each of those proxy contests, the CSA notes, the issuer made payments to soliciting dealers only for votes cast in favour of the election of its own incumbent nominee directors and the soliciting dealer fees would only be paid if the incumbent slate was elected. The cause for the CSA’s concern arises out of the possibility that it may be difficult for issuers entering into soliciting dealer arrangements to communicate directly with retail investors who are objecting beneficial owners (OBOs) under *National Instrument 54-101* *Communication with Beneficial Owners of Securities of a Reporting Issuer* (NI 54-101). CSA staff are additionally concerned that although proxy solicitation firms retained by an issuer may be able to communicate with non-objecting beneficial owners and may have insights with respect to holdings by significant holders, they are not also able to contact retail OBOs. The CSA notes that while there are rules in place such as *National Instrument 54-102 Continuous Disclosure Obligation* (NI 51-102) and the Investment Industry Regulatory Organization of Canada (IIROC)’s Rule 42 *Conflicts of Interest*, soliciting dealer arrangements still raise certain securities regulatory issues. From the perspective of the dealer, notes the CSA, soliciting dealer arrangements raise issues respecting appropriate management of conflicts of interest as well as risks associated with potential solicitations of proxies. From the perspective of the issuer, they raise public interest-related questions as to whether those arrangements affect the integrity of the tendering process or securityholder vote, including by potentially being used to entrench the board and management. *CSA Staff Notice 61-303 and Request for Comment Soliciting Dealer Arrangements* is [available for download](https://www.bcsc.bc.ca/61-303_%5bCSA_Staff_Notice%5d_04122018/) from the websites of participating jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Barbara Hendrickson to speak at the CBA Environmental, Energy & Resources Law Summit on “Environment and Financial Markets”](https://baxsecuritieslaw.com/barbara-hendrickson-to-speak-at-the-canadian-bar-association-environmental-energy-resources-law-summit-may-31-june-1-2018-winnipeg-manitoba-on-environment-and-financial-markets/) **Published:** April 19, 2018 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson will speak at the Canadian Bar Association Environmental, Energy & Resources Law Summit on May 31 – June 1, 2018 in Winnipeg Manitoba on “Environment and Financial Markets” Barbara will speak on a CBA panel which will review the roles of legal counsel... **Content:** Barbara Hendrickson will speak at the Canadian Bar Association Environmental, Energy & Resources Law Summit on May 31 – June 1, 2018 in Winnipeg Manitoba on “Environment and Financial Markets” Barbara will speak on a CBA panel which will review the roles of legal counsel on the frontiers of environmental finance including structuring impact investments, green or climate bonds, tradable credits, renewable energy certificates and other environmental finance innovations. **Categories:** News & Updates --- ### [CSA Request for Comment Proposed National Instrument 93-102 Derivatives: Registration and Proposed Companion Policy 93-102](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-for-comment-csa-notice-and-request-for-comment-proposed-national-instrument-93-102-derivatives-registration-and-proposed-companion-policy-93-102-derivatives/) **Published:** April 26, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published for comment Proposed National Instrument 93-102 Derivatives: Registration and Proposed Companion Policy 93-102 Derivatives: Registration (Together, these are referred to as the Proposed Instrument.) The 150-day comment period ends September 17, 2018. The Proposed Instrument, together with the Proposed... **Content:** The Canadian Securities Administrators (CSA) has published for comment *Proposed National Instrument 93-102 Derivatives: Registration and Proposed Companion Policy 93-102 Derivatives: Registration* (Together, these are referred to as the Proposed Instrument.) The 150-day comment period ends September 17, 2018. The Proposed Instrument, together with the Proposed National Instrument 93-101 *Derivatives: Business Conduct* and Proposed Companion Policy 93-101 *Derivatives: Business Conduct* (referred collectively as the Business Conduct Instrument), which was published for comment in April of 2017, are intended to implement a comprehensive regime for the regulation of persons or companies that are in the business of trading derivatives and in the business of advising on derivatives. CSA staff expect that a future version of the Business Conduct Instrument will be published for a second comment period shortly after the publication of the Proposed Instrument so that there will be considerable overlap of each instrument’s comment period. This will allow commenters to consider the Proposed Instrument and the revised Business Conduct Instrument together when making their comments. **Background:** In April 2013, the CSA published for comment a consultation paper, CSA Consultation Paper 91-407 Derivatives: Registration (the Consultation Paper), that outlined a proposed registration and business conduct regime for derivatives market participants. After considering the comments received on the Consultation Paper and reviewing developments internationally, CSA staff have published the Proposed Instrument. Staff from certain jurisdictions will consider whether modifications to securities legislation, including act amendments, are needed to implement the Proposed Instrument. In particular, it is known that accredited counterparties are exempt by law from the registration requirement under the Québec Derivatives Act when transacting with each other. The implementation of the Proposed Instrument is therefore subject to the Québec National Assembly’s decision to revoke this exemption. While the registration regime contemplated by the Proposed Instrument would apply in all CSA jurisdictions, Ontario’s Securities Act provides that certain specified financial institutions are exempt from registration. As a result, the Ontario Securities Commission (the OSC) will not register those specified financial institutions when they act as derivatives dealers or advisers in the Ontario market. OSC staff note that to the extent these financial institutions are acting as derivatives dealers or advisers, they will be subject to the Business Conduct Instrument, other relevant requirements and prohibitions under Ontario securities law, and various powers that are available to the OSC to promote compliance with the law. These specified financial institutions are also subject to certain prudential obligations and oversight. OSC staff would expect to employ all of the available tools, as appropriate, to attempt to achieve outcomes that are as closely aligned as possible to future outcomes of the Proposed Instrument. Even with the regulatory tools discussed above, the OSC has identified a gap that relates to the registration of individual representatives of specified financial institutions and is currently assessing potential regulatory solutions that are available to address this gap. **Substance and Purpose:** The CSA has developed the Proposed Instrument to help protect investors, reduce risk and, improve transparency and accountability in the over-the-counter (OTC) derivatives markets. It is the view of the regulator, that during the financial crisis of 2008, some firms dealing in derivatives contributed to the crisis by not effectively managing their own derivatives related risks. Responding to this, the Proposed Instrument includes requirements: - designed to mitigate risks to market participants; - designed to ensure that key staff members of derivatives dealers and derivatives advisers have the necessary education, training, and experience needed to carry out their obligations; and, - for derivatives firms and individual representatives to register with applicable securities regulators in Canada and allow those regulators to deny registration to a firm or an individual or suspend the registration of a firm or an individual in appropriate circumstances. The Proposed Instrument, together with the Business Conduct Instrument, is intended to establish a robust investor protection regime that meets The International Organization of Securities Commissions (IOSCO)’s international standards. The resulting proposed regime is consistent with the regulatory approach taken by most IOSCO jurisdictions with active derivatives markets. A person or company is subject to the Proposed Instrument only if it must register as a derivatives adviser or a derivatives dealer under securities legislation. The Proposed Instrument also provides exclusions and exemptions for certain persons or companies from the requirements to register as a derivatives dealer or as a derivatives adviser. Persons or companies that are excluded or exempted from the requirement to register are not subject to any obligations under the Proposed Instrument other than the conditions relating to the exclusion or exemption. This version of the Proposed Instrument does not include registration requirements for persons that have very large gross notional amounts under derivatives but would not otherwise be required to be registered. After additional analysis relating to Canadian derivatives markets, a future version of the Proposed Instrument, that will be published for comment, may include an additional registration category for these large non-dealer derivatives participants. **Conditional Exemptions:** The Proposed Instrument provides a number of exemptions from registration requirements, subject to specific terms and conditions. The exemptions include: - an exemption from registration for derivatives dealers that have a limited notional amount of derivatives. (The notional amount is determined based on the derivatives dealer’s aggregate month-end gross notional amount under outstanding derivatives.); - exemptions from the requirement to register for certain derivatives dealers and derivatives advisers that have their head office or principal place of business outside of Canada; and, - an exemption from specific registration requirements meeting certain requirements, including an exemption from specific registration requirements is for registered derivatives dealers that are dealer members of the Investment Industry Regulatory Organization of Canada (IIROC). This particular exemption is subject to the condition that dealers comply with the equivalent requirements imposed by IIROC. *CSA Notice and Request for Comment Proposed National Instrument 93-102 Derivatives: Registration and Proposed Companion Policy 93-102 Derivatives: Registration* is [available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20180419_93-102_rfc-derivatives-registration.htm) from the websites of participating jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Cooperative Capital Markets Regulatory System Takes Shape as Participating Jurisdictions Publish for Comment the Draft Prospectus and Related Registration Exemptions Regulations](https://baxsecuritieslaw.com/cooperative-capital-markets-regulatory-system-takes-shape-as-participating-jurisdictions-publish-for-comment-the-draft-prospectus-and-related-registration-exemptions-regulations/) **Published:** May 15, 2018 **Author:** Barbara Hendrickson **Excerpt:** The provinces and territory (British Columbia, New Brunswick, Ontario, Prince Edward Island, Saskatchewan, and Yukon – the Participating Jurisdictions) participating in the development of the Cooperative Capital Markets Regulatory System (Cooperative System) have published for comment a draft prospectus and related registration exemption regulations (the... **Content:** The provinces and territory (British Columbia, New Brunswick, Ontario, Prince Edward Island, Saskatchewan, and Yukon – the Participating Jurisdictions) participating in the development of the Cooperative Capital Markets Regulatory System (Cooperative System) have published for comment a draft prospectus and related registration exemption regulations (the draft regulations) under the proposed provincial-territorial *Capital Markets Act* (CMA) for a period ending August 7, 2018. When in force, the CMA and the initial regulations would constitute the single set of substantive provincial/territorial capital market laws under the Cooperative System. The draft regulations currently are contemplated as a possible single set of prospectus and related registration exemptions that would apply in the Participating Jurisdictions on the launch of the Cooperative System. These draft regulations were not part of the draft initial regulations that were published for comment in August 2015. The Participating Jurisdictions also plan to publish for comment a draft prospectus exemption for certain distributions made through investment dealers in the near future. Additionally, they are also considering additional regulations on a registration exemption for certain financial institutions, as well as transitional matters and fees under the CMA and the federal *Capital Markets Stability Act* (CMSA). Consultations on these items are expected in advance of the launch of the Capital Markets Regulatory Authority (CMRA). The CMRA, when in place, will administer the Cooperative System, and is intended to be a single operationally independent capital markets regulatory authority, with an expert Board of Directors, a regulatory division, and an adjudicative tribunal. It will administer the CMA and the CMSA and a single set of regulations under authority delegated by the participating jurisdictions. It is intended to be responsible for regulatory, enforcement, and adjudicative functions, and will have the authority to identify and manage systemic risk. The CMRA will represent Canada internationally in matters of capital markets regulation. Currently, the timeline for the implementation of Cooperative System is in a holding pattern pending an appeal to the Supreme Court of Canada by the Quebec Court of Appeal that was heard on March 22, 2018, on the constitutionality of elements of the Cooperative System. The Supreme Court’s decision will determine the future of the Cooperative System. If the Supreme Court overturns the Quebec Court of Appeal’s decision, the Participating Jurisdictions will be able to go ahead with their launch plan of the Cooperative System. As it stands now, the Participating Jurisdictions are presently reviewing the timelines for the launch, while waiting for the Supreme Court to render its decision. The Participating Jurisdictions do note however, they will respect the Supreme Court’s decision and will proceed accordingly. They will provide an update on the timing of the launch of the Cooperative System following the decision and the completion of their implementation timeline review. At present, the launch of the Cooperative System is not expected to occur by the end of 2018. More information and further updates on the Cooperative Capital Markets Regulatory System can be found [here](http://ccmr-ocrmc.ca/). 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [When the Blockchain Gets Broken: The Coincheck Breach](https://baxsecuritieslaw.com/when-the-blockchain-gets-broken-the-coincheck-breach/) **Published:** May 17, 2018 **Author:** Barbara Hendrickson **Excerpt:** Since their inception, cryptocurrencies and their underlying blockchain technologies have been touted by their promoters as both secure and anonymous. Unfortunately, as a number of recent breaches by hackers into blockchain-based cryptocurrency exchanges have shown, this is not the case. Blockchain technology, which relies upon... **Content:** Since their inception, cryptocurrencies and their underlying blockchain technologies have been touted by their promoters as both secure and anonymous. Unfortunately, as a number of recent breaches by hackers into blockchain-based cryptocurrency exchanges have shown, this is not the case. Blockchain technology, which relies upon a decentralized control system, as opposed to a centralized electronic money or centralized banking system, serves as the heart of cryptocurrencies such as Bitcoin. In a blockchain system, the transaction can be validated and secured without the presence of trusted intermediary parties, with the security due to the fact the blockchains are designed to be inherently resistant to modification of data. However, there have been some glaring examples of blockchain breaches by hackers, resulting in the theft of millions of dollars of bitcoin and other cryptocurrencies. Most recently, in January 2018, in the single largest incident to date, hackers stole over US$530 million of the XEM token belonging to 260,000 customers from Coincheck, a Japanese cryptocurrency exchange and wallet service. Key to the relative ease that the hackers breached Coincheck’s defenses was that the XEM tokens were stored in hot wallets directly connected to external networks. Meanwhile, cryptocurrencies such as Bitcoin perceived by Coincheck as being more valuable were stored in cold wallets, which are typically removable media such as USB drives or other external hard drives and are securely stored offsite. The Coincheck attack participated a shake-up within the Japanese crypto sector. The Japanese Financial Services Agency (FSA), which had begun regulating and licensing cryptocurrency-related business in 2017, launched onsite inspections of the country’s 15 unlicensed cryptocurrency exchanges. The FSA has handed out business improvement notices to Coincheck and six other crypto firms and issued temporary cease trade orders to two more. Coincheck which had begun business 2014 and operated on an unlicensed basis, has since said it will apply for licensing under the FSA. The exchange is currently the target of [two class-action suits](https://cointelegraph.com/news/another-lawsuit-filed-against-hacked-crypto-exchange-coincheck-asks-for-almost-800000) by cryptocurrency traders who lost tokens in the attack. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Toronto Stock Exchange Issues Staff Notice 2018-003, Prospectus Offerings and Private Placements](https://baxsecuritieslaw.com/toronto-stock-exchange-issues-staff-notice-2018-003-prospectus-offerings-and-private-placements/) **Published:** May 29, 2018 **Author:** Barbara Hendrickson **Excerpt:** On May 10, 2018, the Toronto Stock Exchange (TSX) issued Staff Notice 2018-003, Prospectus Offerings and Private Placements (the Staff Notice), which provides guidance regarding pricing a prospectus offering or private placement where there has been recent disclosure of material information. Generally, the TSX requires... **Content:** On May 10, 2018, the Toronto Stock Exchange (TSX) issued *Staff Notice 2018-003, Prospectus Offerings and Private Placements* (the Staff Notice), which provides guidance regarding pricing a prospectus offering or private placement where there has been recent disclosure of material information. Generally, the TSX requires private placements and prospectus offerings to be priced at “market price” less an allowable discount. The TSX defines “market price” as the five-day volume-weighted average trading price (Five Day VWAP) of the securities on the TSX immediately preceding the relevant date. In the Staff Notice, the TSX notes there may be instances where the Five Day VWAP may not be appropriate, especially in cases where trading days occur both before and after material information is disclosed. Consequently, the TSX may elect to let issuers use a shorter time period for determining market price, taking into account: - the liquidity and volatility of the issuer’s securities, both before and after the material information is announced; - the time period proposed to be used as a reference for market price; - the rationale for pricing a financing immediately after the material information is disseminated; and, - any insider participation in the financing. As the availability of this particular exception is expected to be limited, the TSX strongly encourages listed issuers and their advisors to contact them when considering a shorter time period for calculating market price. The TSX will continue to permit exceptions in cases where an undisclosed event would not occur without a financing agreement, such as where financing proceeds are used to fund an acquisition and the key terms of the financing, including the price, are announced at the same time as the acquisition. *TSX Staff Notice 2018-003, Prospectus Offerings and Private Placements* can be found [here](http://tmx.complinet.com/en/display/display.html?rbid=2072&element_id=1148). 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Ontario Securities Commission Joins North American Securities Regulators in Operation Cryptosweep, Issues Warnings](https://baxsecuritieslaw.com/ontario-securities-commission-joins-north-american-securities-regulators-in-operation-cryptosweep-issues-warnings/) **Published:** May 29, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) announced this month it had participated with over 40 North American Securities regulators in Operation Cryptosweep, in a coordinated effort to take down fraudulent cryptocurrency schemes. Since its launch at the beginning of May, Cryptosweep resulted in nearly 70 inquiries... **Content:** The Ontario Securities Commission (OSC) announced this month it had participated with over 40 North American Securities regulators in Operation Cryptosweep, in a coordinated effort to take down fraudulent cryptocurrency schemes. Since its launch at the beginning of May, Cryptosweep resulted in nearly 70 inquiries and investigations, and 35 pending or completed enforcement actions regarding initial coin offerings (ICOs) or cryptocurrencies, according to the North American Securities Administrators Association (NASAA). As a result, the OSC has issued warnings regarding five firms that are targeting investors in Ontario but are not registered to trade in securities in that province: Brera, BitSerial, Hypercube Ventures LP, CabinCoin OÜ, and BaapPay Inc. The regulator also issued a separate warning regarding BitConnect, which is also not registered to trade in securities in the province of Ontario. Other regulators have also taken action regarding BitConnect. In January 2018, the Texas State Securities Board issued an emergency cease and desist order against BitConnect, while the New Brunswick Financial and Consumer Services Commission published an investment alert regarding this entity. Meanwhile, the British Columbia Securities Commission (BCSC) issued letters to 12 offshore companies advertising ICOs in B.C., asking that they cease activities in the province until they become compliant with securities legislation. The OSC advises that investors should consider the risks associated with investing in cryptocurrencies and be aware that the marketing of high returns is often an indication of investment fraud. It asks anyone who has dealt with any of the above companies to contact them. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Canadian Securities Administrators Issue Warning Regarding Cryptocurrency Exchanges](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-warning-regarding-cryptocurrency-exchanges/) **Published:** June 11, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has warned Canadians to be careful when buying cryptocurrency assets through trading platforms. The CSA advises although a platform may call itself an "exchange," that does not mean it is complying with securities regulations. Currently, there are no crypto-asset trading... **Content:** The Canadian Securities Administrators (CSA) has warned Canadians to be careful when buying cryptocurrency assets through trading platforms. The CSA advises although a platform may call itself an “exchange,” that does not mean it is complying with securities regulations. Currently, there are no crypto-asset trading platforms recognized by the CSA or any provincial or territorial securities regulator as an exchange or is otherwise authorized to operate as a marketplace or dealer in Canada. Crypto-asset trading platforms are online trading facilities that allow investors to buy and sell crypto assets, including bitcoin or ether, and/or coins or tokens that may have been sold through initial coin offerings or initial token offerings. In some instances, these platforms are advertising themselves as exchanges. It is the position of the CSA that if a platform is facilitating the trading of crypto assets or interests in crypto assets that are securities or derivatives, that platform is required to comply with securities legislation. It warns potential investors to be wary when dealing with any crypto-asset trading platform because key investor protections such as secure handling of client funds, appropriate safekeeping and protection of assets, and confidentiality safeguards for personal information, may not be in place. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [BCSC Varies BC Instrument 94-501](https://baxsecuritieslaw.com/bcsc-varies-bc-instrument-94-501/) **Published:** June 11, 2018 **Author:** Barbara Hendrickson **Excerpt:** On May 31, 2018, the British Columbia Securities Commission (BCSC), published an update, varying BC Instrument 94-501 - Exemption from the mandatory clearing requirements in National Instrument 94-101 – Mandatory Central Counterparty Clearing of Derivatives for certain counterparties to extend the exemption. The full text... **Content:** On May 31, 2018, the British Columbia Securities Commission (BCSC), published an update, varying *BC Instrument 94-501 – Exemption from the mandatory clearing requirements in National Instrument 94-101 – Mandatory Central Counterparty Clearing of Derivatives for certain counterparties to extend the exemption*. [The full text of BC Instrument 95-501](https://www.bcsc.bc.ca/94-501_%5bBCI%5d_05312018/) is available on the website of the British Columbia Securities Commission. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Barbara Hendrickson speaks at CBA NEERLS conference on June 1, 2018 on CSA Staff Notice 51-354 Report on Climate change-related Disclosure Project](https://baxsecuritieslaw.com/barbara-hendrickson-speaks-at-cba-neerls-conference-on-june-1-2018-on-csa-staff-notice-51-354-report-on-climate-change-related-disclosure-project/) **Published:** June 18, 2018 **Author:** Barbara Hendrickson **Excerpt:** [et_pb_section fb_built="1" admin_label="section" _builder_version="3.0.47"][et_pb_row admin_label="row" _builder_version="3.0.48" background_size="initial" background_position="top_left" background_repeat="repeat"][et_pb_column type="4_4" _builder_version="3.0.47" parallax="off" parallax_method="on"][et_pb_text admin_label="Text" _builder_version="3.0.74" background_size="initial" background_position="top_left" background_repeat="repeat"]To view PowerPoint Presentation, click here. To download PowerPoint Presentation, click here. [/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section] **Content:** \[et\_pb\_section fb\_built=”1″ admin\_label=”section” \_builder\_version=”3.0.47″\]\[et\_pb\_row admin\_label=”row” \_builder\_version=”3.0.48″ background\_size=”initial” background\_position=”top\_left” background\_repeat=”repeat”\]\[et\_pb\_column type=”4\_4″ \_builder\_version=”3.0.47″ parallax=”off” parallax\_method=”on”\]\[et\_pb\_text admin\_label=”Text” \_builder\_version=”3.0.74″ background\_size=”initial” background\_position=”top\_left” background\_repeat=”repeat”\] **To view PowerPoint Presentation, [click here.](https://drive.google.com/file/d/1AEOtYnqjxnLy3xC5CLpTsmCqBkWLaSxz/view?usp=sharing)** To download PowerPoint Presentation, [click here.](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/06/BH-REVIEWED-1-Carbon-finance-presentation-CBA-May-31-2018.pptx) ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) \[/et\_pb\_text\]\[/et\_pb\_column\]\[/et\_pb\_row\]\[/et\_pb\_section\] [previousBCSC Varies BC Instrument 94-501](https://baxsecuritieslaw.com/bcsc-varies-bc-instrument-94-501/) [nextCanadian Securities Administrators Issue Second Request for Comment on Proposed Business Conduct Rules for Derivatives Dealers and Advisers](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-second-request-for-comment-on-proposed-business-conduct-rules-for-derivatives-dealers-and-advisers/) ### About BAX Securities Law® Corporate Securities & Financial Services Lawyers BAX Securities Law® practises in the securities and financial services regulatory areas and has acted as counsel to major Canadian and American corporations, market participants. #### Legal Services If you wish to discuss retaining BAX Securities Law® to provide you with legal services, please contact: **Barbara Hendrickson** Managing Partner **416.601.1004** [*bhendrickson@baxsecuritieslaw.com*](mailto:bhendrickson@baxsecuritieslaw.com) [Get In Touch](https://baxsecuritieslaw.com/consult/) **Categories:** News & Updates --- ### [Canadian Securities Administrators Issue Second Request for Comment on Proposed Business Conduct Rules for Derivatives Dealers and Advisers](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-second-request-for-comment-on-proposed-business-conduct-rules-for-derivatives-dealers-and-advisers/) **Published:** June 19, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published a notice and second request for comment on Proposed National Instrument 93-101 Derivatives: Business Conduct and Proposed Companion Policy 93-101 CP Derivatives: Business Conduct (the Proposed Instrument). The Proposed Instrument establishes a business conduct regime for regulating dealers... **Content:** The Canadian Securities Administrators (CSA) has published a notice and second request for comment on Proposed National Instrument 93-101 Derivatives: Business Conduct and Proposed Companion Policy 93-101 CP Derivatives: Business Conduct (the Proposed Instrument). The Proposed Instrument establishes a business conduct regime for regulating dealers and advisers in over-the-counter (OTC) derivatives in Canada. The Proposed Instrument was developed to help protect derivatives market participants by improving transparency, increasing accountability and promoting responsible business conduct by dealers and advisers in the OTC derivatives market. It was originally published for comment on April 4, 2017. Following this, the Proposed Instrument, together with Proposed National Instrument 93-102 Derivatives: Registration and a related companion policy (NI 93-102) published by the CSA on April 19, 2018. The CSA split the proposed derivatives business conduct and derivatives registration regime into two separate rules to ensure that all dealers and advisers remain subject to certain minimum standards in all Canadian jurisdictions. Some of the changes in the revised Proposed Instrument include an amendment to the definition of “eligible derivatives party,” which now includes a category for a commercial hedger, a revision to some of the restrictions on derivatives party assets and a change to certain senior manager obligations. The Proposed Instrument is intended to create a uniform approach to derivatives business conduct regulation in Canada and promote consistent protections for market participants, regardless of the type of firms they deal with. The Proposed Instrument will also ensure that derivatives dealers and advisers operating in Canada are subject to consistent regulation that does not result in any competitive disadvantage. The Proposed Instrument takes a two-tiered approach to the protection of derivatives market participants, with requirements that are tailored depending on the nature of the derivatives dealer’s or adviser’s counterparty, customer, or other person or company that the firm deals with or advises. In developing the Proposed Instrument, the CSA considered the existing business conduct regime in the securities markets while tailoring the requirements to the OTC derivatives markets. *Proposed National Instrument 93-101 Derivatives: Business Conduct and Proposed Companion Policy 93-101 CP Derivatives*[ is available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20170404_93-101_rfc-derivatives.htm) from the websites of participating jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [SEC’s Hinman: Crypto Tokens Aren’t Securities, Offerings Are](https://baxsecuritieslaw.com/secs-hinman-crypto-tokens-arent-securities-offerings-are/) **Published:** June 22, 2018 **Author:** Barbara Hendrickson **Excerpt:** According to a recent speech in San Francisco, earlier this month by Securities and Exchange Commission (SEC)’s William Hinman, Ether – the cryptocurrency behind the Ethereum network – should not be regulated in the same way as stocks and bonds. These comments, by Hinman, the... **Content:** According to a recent speech in San Francisco, earlier this month by Securities and Exchange Commission (SEC)’s William Hinman, Ether – the cryptocurrency behind the Ethereum network – should not be regulated in the same way as stocks and bonds. These comments, by Hinman, the SEC’s director of the division of corporate finance, speaking at the Yahoo Finance All Markets Summit, come less than a month after similar comments made by SEC chair Jay Clinton. Hinman’s speech offers insight into how the U.S. securities regulator regards Initial Coin Offerings (ICOs) and Initial Token Offerings (ITOs), which are almost always seen by regulators in both Canada and the U.S. as securities, versus the actual cryptocurrencies themselves, which are not. “Can a digital asset that was originally offered in a securities offering ever be later sold in a manner that does not constitute an offering of a security?” asked Hinman. “I believe in these cases the answer is a qualified ‘yes.'” Hinman explained that through ICOs and ITOs, some promoters, in order to raise capital to develop networks that will operate digital assets, will often sell coins and tokens much in the same way securities are sold. Funds are raised through token offerings, he said, with the expectation that the promotors will successfully build their system and the investors can make a return. That kind of economic transaction, says Hinman, passes the SEC’s sniff test of whether there is an investment contract and therefore the coin or token offering is a security. Whether a coin or token offering constitutes an investment contract is the same test used by Canadian regulators to determine if an offering is a security. Hinman noted while some industry participants may prefer a blockchain mediated crowdfunding model in order to reach a global audience, he thinks that some may now be finding it easier to start a blockchain-based enterprise the more conventional way. “In other words,” he said, “conduct the initial funding through a registered or exempt equity or debt offering and, once the network is up and running, distribute or offer blockchain-based tokens or coins to participants who need the functionality the network and the digital assets offer.” When it comes to the tokens themselves, he says, it’s different. Tokens – the digital assets – he observed, “is simply code.” It’s the how those assets – the tokens – are used, he said, that provides the all-important context that determines, whether there is an investment contract – and therefore a security involved. “The way it is sold,” Hinman said, “as part of an investment to nonusers by promoters to develop the enterprise – can be in that context, and most often is, a security – because it evidences an investment contract.” It’s this logic, he noted, that could lead to a point when a digital asset transaction may no longer represent a security offering. “If the network on which the token or coin is to function is sufficiently decentralized, where purchasers would no longer reasonably expect a person or group to carry out essential managerial or entrepreneurial efforts, the assets may not represent an investment contract.” From a regulatory standpoint, Hinman added, increased network decentralization may also pose its own share of issues. “As a network becomes truly decentralized, the ability to identify an issuer or promoter to make the requisite disclosures becomes difficult and less meaningful.” When Hinman looks at cryptocurrencies like Bitcoin and Ether, he said he doesn’t see a third-party who is a central actor filling that key managerial or entrepreneurial role. Therefore, applying securities laws to the offer and resales of Bitcoin, he said would have “little value,” while he believes the current offer and sales of Ether “are not securities transactions.” “Over time,” he added, “there may be other sufficiently decentralized networks and systems where regulating the tokens or coins that function on them as securities may not be required.” 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Barbara Hendrickson Quoted In CBA Practice Link Article](https://baxsecuritieslaw.com/barbara-hendrickson-quoted-in-cba-practice-link-article/) **Published:** June 22, 2018 **Author:** Barbara Hendrickson **Excerpt:** IT’S BECOMING EASIER TO BE GREEN – WITH BETTER RETURNS MAY 25, 2018 Click here to view article **Content:** *IT’S BECOMING EASIER TO BE GREEN – WITH BETTER RETURNS MAY 25, 2018* **[Click here to view article](https://www.cba.org/Publications-Resources/CBA-Practice-Link/Business-and-Corporate/2018/green)** **Categories:** News & Updates --- ### [Japanese Crypto Exchanges Face Action Over Anti-Money-Laundering Concerns](https://baxsecuritieslaw.com/japanese-crypto-exchanges-face-action-over-anti-money-laundering-concerns/) **Published:** June 22, 2018 **Author:** Barbara Hendrickson **Excerpt:** In the wake of the Coincheck breach earlier this year, the Japanese Financial Services Agency (FSA) has been cracking down on that country’s cryptocurrency exchanges. Now a new wrinkle has emerged over concerns that the country’s licensed crypto exchanges do not have sufficient internal processes... **Content:** In the wake of the [Coincheck breach](https://lawfirmbarbara.wpengine.com/when-the-blockchain-gets-broken-the-coincheck-breach/) earlier this year, the Japanese Financial Services Agency (FSA) has been cracking down on that country’s cryptocurrency exchanges. Now a new wrinkle has emerged over concerns that the country’s licensed crypto exchanges do not have sufficient internal processes in place, including anti-money laundering (AML) procedures. According to a [recent report from Nikkei](https://asia.nikkei.com/Spotlight/Bitcoin-evolution/Japan-to-order-bitFlyer-and-other-cryptocurrency-services-to-shape-up), the FSA will issue business improvement orders to more than five crypto exchanges, including bitFlyer and Quoine. The move by the FSA comes after a group of self-regulating Japanese crypto exchanges proposed to strengthen their AML procedures by prohibiting platforms that list anonymous cryptocurrencies such as monero and dash. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish Client Focused Reforms for Comment and Staff Notice 81-330 Status Report on Consultation on Embedded Commissions](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-client-focused-reforms-for-comment-and-staff-notice-81-330-status-report-on-consultation-on-embedded-commissions/) **Published:** June 26, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) recently published two notices for a 120-day comment period regarding investor protection initiatives (Client Focused Reforms). Together, the goal of these reforms, states the regulator, is to provide a single set of harmonized reforms that would require registered firms and... **Content:** The Canadian Securities Administrators (CSA) recently published two notices for a 120-day comment period regarding investor protection initiatives (Client Focused Reforms). Together, the goal of these reforms, states the regulator, is to provide a single set of harmonized reforms that would require registered firms and individuals to put the best interest of their clients first. The CSA has taken a two-pronged approach to its Client Focused Reforms. The first set of reforms targets the obligations of registered firms and individuals (registrants). When implemented, they would result in changes that would require registered firms and individuals to promote the best interests of clients and put clients’ interests first. The second set of Client Focused Reforms aim to better align the interests of registrants and investors, improve investor outcomes, and raises the bar for registrant conduct. The CSA, through the Proposed Amendments to National Instrument 31-103 Registration Requirements, Exemptions, and Ongoing Registrant Obligations, is proposing changes that would require registrants to address conflicts of interest in the best interest of the client; put the client’s interests first when making a suitability determination; and provide clients with greater clarity on what they should expect from their registrants. The reforms are the result of extensive consultations by the CSA as well as focused consultations conducted by the Ontario Securities Commission (OSC) and the Financial and Consumer Services Commission of New Brunswick (FCNB) on an overarching regulatory best interest standard. In the view of the CSA, the Client Focused Reforms ensure that registrants maintain their client’s best interests first regarding the conflicts of interest obligation and puts clients first in the suitability obligations of registrants. of interest obligation and puts clients first in the suitability obligations of registrants. **CSA Staff Notice 81-330 Status Report on Consultation on Embedded Commissions and Next Steps:** In a separate notice, the CSA published CSA Staff Notice 81-330 Status Report on Consultation on Embedded Commissions and Next Steps (The Staff Notice). In the Staff Notice, the CSA announced its policy decision on mutual fund embedded commissions. The CSA’s policy decision has three parts. The first is integrated into the Client Focused Reforms’ proposal to require registrants to address conflicts of interest in the best interest of the client, including conflicts of interest associated with embedded commissions and other third-party compensation. The CSA will address the other two components with a publication of rule proposals for comment in September 2018 to prohibit: - all forms of the deferred sales charge option, including low-load options and their associated upfront commissions; and - the payment of trailing commissions to dealers who do not make a suitability determination. Together, the Client Focused Reforms and the Staff Notice are part of the CSA’s harmonized response to concerns with the client-registrant relationship as it exists today. *The Client Focused Reforms and the policy decision on mutual fund embedded commissions* [is available for download](http://osc.gov.on.ca/documents/en/Securities-Category3/rule_20180621_31-103_client-focused-reforms.pdf) from the websites of participating jurisdictions. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [Tezos Investors Hit with Surprise KYC/AML Check](https://baxsecuritieslaw.com/tezos-investors-hit-with-surprise-kyc-aml-check/) **Published:** June 26, 2018 **Author:** Barbara Hendrickson **Excerpt:** In a move that should have surprised no-one but actually did, investors in the Tezos blockchain project are being hit with a Know Your Client (KYC)/Anti-Money Laundering (AML) audit, which has managed to have enraged almost all the participants. On June 10, the Tezos Foundation... **Content:** In a move that should have surprised no-one but actually did, investors in the Tezos blockchain project are being hit with a Know Your Client (KYC)/Anti-Money Laundering (AML) audit, which has managed to have enraged almost all the participants. On June 10, the Tezos Foundation which had carried out the July 2017 Tezos Initial Coin Offering (ICO) which brought in an at the time a record USD 232 billion from investors, announced it was conducting the KYC/AML check of those investors who participated in the ICO. The Foundation noted in its announcement, “performing KYC/AML checks – as has become the norm for blockchain projects – is the best way forward.” The reaction from investors who had signed up to purchase the Tezos tokens – “tezzies” – was, to say the least unimpressed. The selling point of the Tezos initiative was that it was “different,” offering a new system that would fix what was seen as a broken governance model. Many investors have expressed intense frustration that the KYC/AML process that was not part of the original ICO seemed to have been sprung on them. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [OSC Study: Ontario Investors at Risk by Lack of Understanding of Crypto Assets](https://baxsecuritieslaw.com/osc-study-ontario-investors-at-risk-by-lack-of-understanding-of-crypto-assets/) **Published:** July 3, 2018 **Author:** Barbara Hendrickson **Excerpt:** According to a study recently published by the Ontario Securities Commission (OSC), while a sizable number of Ontarians own cryptocurrency assets, the majority remain unclear on the basics of cryptocurrency, while many are ignorant of the regulatory framework surrounding them. The OSC study, The Taking... **Content:** According to a study recently published by the Ontario Securities Commission (OSC), while a sizable number of Ontarians own cryptocurrency assets, the majority remain unclear on the basics of cryptocurrency, while many are ignorant of the regulatory framework surrounding them. The OSC study, *The Taking Caution: Financial Consumers and the Cryptoasset Sector* sampled over 2,500 Ontarians. According to the survey, 5% of Ontarians – 500,000 people, based on provincial population estimates and survey data – own cryptocurrency assets. Among purchasers, the study found that men aged 18-34 are more likely to own a cryptoasset. The majority owned Bitcoin (63%) or Ether (35%). Cryptocurrency investors seemed also to be somewhat risk-adverse, with less than half (38%) spending less than $1,000, while only 9% spent more than $10,000. The study also found that 42% of those who purchased cryptoassets reported that they had done so with the hope of selling them for a higher price later in time. The study also found that 16% of those surveyed participated in an Initial Coin Offering (ICO) to acquire their tokens. Almost half (46%) of those who acquired cryptoassets used an online trading platform, while 28% acquired their tokens through mining. Of those who used online trading platforms, many reported issues, such as a halt in trading (21%), difficulties withdrawing money from their account (20%), problems transferring money into their trading platform account (16%), and not understanding the fees they are being charged (15%). However, as top of mind cryptocurrencies have become, the study found that many people actually do not understand them. Fully 52% of those surveyed say they’ve heard about cryptocurrencies but don’t know much about them. Another 25% admitted they are somehow familiar with them, but they don’t know much details. Only 5% felt familiar enough to be able to explain them in detail to others. The study also revealed that more education for would-be cryptoasset purchasers is clearly needed. Of the current and former cryptoasset owners surveyed, 21% believed that ICOs were unregulated, while just 41% could correctly identify the OSC as the regulator responsible for oversight of ICOs in Ontario. The complete study, *The Taking Caution: Financial Consumers and the Cryptoasset Sector,* is [available for download](http://www.osc.gov.on.ca/documents/en/Investors/inv_research_20180628_taking-caution-report.pdf) from the website of the Ontario Securities Commission. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2017/10/Barb-bar-01-1024x248.jpg) **Categories:** News & Updates --- ### [CSA Multilateral Notice and Request for Comment Proposed Amendments to National Instrument 45-106 Prospectus Exemptions relating to Reports of Exempt Distribution](https://baxsecuritieslaw.com/csa-multilateral-notice-and-request-for-comment-proposed-amendments-to-national-instrument-45-106-prospectus-exemptions-relating-to-reports-of-exempt-distribution/) **Published:** August 2, 2018 **Author:** Barbara Hendrickson **Excerpt:** On June 8, 2018, the Canadian Securities Administrators (CSA ) published a notice indicating that they are making amendments (the Rule Amendments) to National Instrument 45-106 Prospectus Exemptions (NI 45-106) to amend Form 45-106F1 Report of Exempt Distribution (the Report)  and a related change to Companion Policy 45-106CP Prospectus Exemptions (45-106CP). Provided all necessary... **Content:** On June 8, 2018, the Canadian Securities Administrators (**CSA** ) published a notice indicating that they are making amendments (the **Rule Amendments**) to National Instrument 45-106 *Prospectus Exemptions* (**NI 45-106**) to amend Form 45-106F1 *Report of Exempt Distribution* (the **Report**) and a related change to Companion Policy 45-106CP *Prospectus Exemptions* (**45-106CP**). Provided all necessary ministerial approvals are obtained, the Revisions will come into force on October 5, 2018. Changes to 45-105F1 will include the following amendments and clarifications: Certification: The instructions will be clarified that if the Report is being certified by an agent on behalf of an issuer or underwriter, the name of the agent should be provided in the box titled “Name of issuer/underwriter/investment fund manager/agent” and the information for the agent’s certifying individual should be used to complete all other boxes. North American Industry Classification Standard (**NAICS**) code: Amendments will be made Item 5a) of the Report to explicitly request filers to provide the issuer’s NAICS code that in their reasonable judgment most closely corresponds to the issuer’s primary business activity. Public listing status: In Item 5g) of the Report, the requirement for non-investment fund issuers to identify the name of the exchange on which the issuer’s securities primarily trade will be amended, to provide that this requirement only applies to equity securities. Filers are not required to provide any exchange information pertaining to an issuer’s debt securities. Size of assets: Item 5h) to direct filers to select the size of the issuer’s assets based on its most recently available annual financial statements has been amended. Distribution by co-issuers: In circumstances where two or more issuers distribute a single security, amendments will provide that an issuer or underwriter is not required to file a report for a distribution of securities if a report has been filed by another issuer or underwriter for the distribution of the same security. Item 3 of the Report will be amended to require that, in these instances, the filer identifies the co-issuers of the security. Purchasers’ secondary given names: Paragraph b)3 of Schedule 1 will be amended to add the words “(if applicable)” to the requirement for purchasers’ secondary given names. Cryptocurrencies and cryptocurrency-related assets: According to the notice, given the increase in the number of offerings in the exempt market by issuers that invest in cryptoassets: - Item 5a) of the Report will be amended to require filers to identify an issuer whose primary business is to invest all or substantially all of its assets in cryptoassets; - Item 6b) of the Report will be amended to require filers to identify where the type of investment fund that most accurately identifies an investment fund issuer is a cryptoasset investment fund; and - the list of security codes in the general instructions of the Report will be amended to introduce a new security code “DCT” for distributions of securities involving digital coins or tokens. These changes will allow the CSA to more accurately monitor issuers that invest in cryptocurrencies and cryptocurrency-related assets and to identify distributions of securities involving digital coins or tokens. The complete notice is [available for download](http://www.osc.gov.on.ca/documents/en/Investors/inv_research_20180628_taking-caution-report.pdf) from the website of the Ontario Securities Commission. [http://www.osc.gov.on.ca/en/SecuritiesLaw\_ni\_20170608\_45-106\_exempt-distribution.htm](http://www.osc.gov.on.ca/en/SecuritiesLaw_ni_20170608_45-106_exempt-distribution.htm) 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/09/DOUBLE-CREST.png) **Categories:** News & Updates --- ### [BAX Securities Law voted a Top 10 Canadian Corporate Boutique Law Firm for 2018-2019](https://baxsecuritieslaw.com/bax-securities-law-voted-a-top-10-canadian-corporate-boutique-law-firm-for-2018-2019/) **Published:** September 11, 2018 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law voted a Top 10 Canadian Corporate Boutique Law Firm for 2018-2019 Toronto, September 10, 2018: BAX Securities Law (BAX) is pleased to announce it has once again been ranked as one of the Top 10 Corporate Boutique law firms in Canada for... **Content:** ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/05/Barb-Logo-JPG.jpg)![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/09/Barb-Logo.jpg) **BAX Securities Law voted a Top 10 Canadian Corporate Boutique Law Firm for 2018-2019** **Toronto, September 10, 2018:** BAX Securities Law (BAX) is pleased to announce it has once again been ranked as one of the Top 10 Corporate Boutique law firms in Canada for 2018-2019 by [Canadian Lawyer](https://www.canadianlawyermag.com/author/aidan-macnab/client-centred-growth-top-ten-corporate-boutiques-16123/?utm_term=Client-centred%20growth:%20Top%20Corporate%20Boutiques&utm_campaign=CLNewswire_20180904&utm_content=email&utm_source=Act-On+Software&utm_medium=email) a Thomson Reuter’s publication. It also received this prestigious ranking for 2016-2017. *Canadian Lawyer* selected Canada’s top litigation and corporate law boutiques by asking readers to rank a long list of notable firms. Based on a voting process and input by industry peers, lawyers and clients, BAX was chosen and is among the group of boutique firms most highly rated. The top 10 boutique firms in this category were all equally confident of their ability to match Big Law’s strength and expertise. “I’m very proud and honoured to have our firm selected, once again, to be part of this impressive group of Top 10 Boutique Law firms in Canada”, says Barbara Hendrickson, who founded BAX in 2013. “This ranking survey is further validation that our firm continues to be recognized for its expertise, caliber of work and ability to execute for our valued clients and business partners.” **About BAX Securities Law** BAX Securities Law (BAX) has a national and cross-border focus and offers corporate and securities advice to its clients operating in a number of areas including the fintech industry (including cryptocurrency), investment funds, real estate syndication and commodities (carbon, energy, and minerals) sectors. It specializes in online offering platforms including crowdfunding and peer-to-peer lending, and acts for public companies, venture capitalists, private equity firms and securities registrants including exempt market dealers. Barbara Hendrickson is the founder of BAX and a senior securities lawyer with more than 20 years experience including with the Ontario Securities Commission, a leading Canadian national firm, and one of the world’s largest international law firms. For additional info please visit: lawfirmbarbara.wpengine.com or Contact: Barbara Hendrickson E: [bhendrickson@baxsecuritieslaw.com](bhendrickson@baxsecuritieslaw.com) P: 416.601.1004 or M: 647.403.4606 **Categories:** News & Updates --- ### [Coordinated Crypto Crackdown](https://baxsecuritieslaw.com/coordinated-crypto-crackdown/) **Published:** September 12, 2018 **Author:** Barbara Hendrickson **Excerpt:** On August 28, 2018 the North American Securities Administrators Association (NASAA) announced that more than 200 active investigations of Initial Coin Offerings (ICOs) and cryptocurrency-related investment products are currently underway by state and provincial securities regulators in the United States and Canada as part of... **Content:** On August 28, 2018 the North American Securities Administrators Association (NASAA) announced that more than 200 active investigations of Initial Coin Offerings (ICOs) and cryptocurrency-related investment products are currently underway by state and provincial securities regulators in the United States and Canada as part of NASAA’s ongoing initiative “[Operation Cryptosweep](http://www.nasaa.org/regulatory-activity/enforcement-legal-activity/operation-cryptosweep/).” NASAA reports that since its launch in May of 2018, cross border regulatory focus has resulted in 46 enforcement actions involving ICOs or cryptocurrency-related investment products. Some of the enforcement investigations initiated as part of Operation Cryptosweep involve suspected securities fraud, other investigations involve potential violations of state and provincial securities laws, including failure to properly register a product before it was offered to investors. NASAA is a voluntary association whose membership consists of 67 state, provincial, and territorial securities administrators in the 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Canada, and Mexico. 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. ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/09/DOUBLE-CREST-New.png) **Categories:** News & Updates --- ### [BAX Securities Law sponsors the Women's Law Association of Ontario 2018 Deb Snead Golf Tournament](https://baxsecuritieslaw.com/bax-securities-law-voted-a-top-10-canadian-corporate-boutique-law-firm-for-2018-2019-2/) **Published:** September 13, 2018 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law sponsors the Women's Law Association of Ontario 2018 Deb Snead Golf Tournament Toronto, September 13, 2018: BAX Securities Law (BAX) is delighted to announce its sponsorship of the 17th annual Women's Law Association Deb Snead Golf Tournament to be held at Richmond... **Content:** ![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/05/Barb-Logo-JPG.jpg)![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/09/Barb-Logo.jpg) **BAX Securities Law sponsors the Women’s Law Association of Ontario 2018 Deb Snead Golf Tournament** **Toronto, September 13, 2018**: BAX Securities Law (BAX) is delighted to announce its sponsorship of the 17th annual Women’s Law Association Deb Snead Golf Tournament to be held at *Richmond Hill Golf Club* on September 17, 2018. The Women’s Law Association of Ontario is dedicated to empowering women in the legal professional by providing a collective voice and advocating for equality, diversity and change. Women’s Law has been providing leadership and support to advance the status of women in the legal profession in Ontario for nearly 100 years. “We are extremely pleased and excited to support such a wonderful event. Not only in support of the annual golf day but to endorse Women’s Law which has a rich history representing women lawyers in Ontario,” states Barbara Hendrickson, managing partner at BAX Securities Law. Barbara Hendrickson was President of Women’s Law when the Deb Snead golf tournament was first held in 2000 and Barbara has been a proud member of Women’s Law for nearly 25 years. This annual golf event combines a day of golf followed by a cocktail reception, silent auction/raffle and dinner. For sponsorship and ticket information, and to learn more about this event, please visit . **About BAX Securities Law** BAX Securities Law (BAX) has a national and cross-border focus and offers corporate and securities advice to its clients operating in a number of areas including the fintech industry (including cryptocurrency), investment funds, real estate syndication and commodities (carbon, energy, and minerals) sectors. It specializes in online offering platforms including crowdfunding and peer-to-peer lending, and acts for public companies, venture capitalists, private equity firms and securities registrants including exempt market dealers. Barbara Hendrickson is the founder of BAX and a senior securities lawyer with more than 20 years experience including with the Ontario Securities Commission, a leading Canadian national firm, and one of the world’s largest international law firms. For additional info please visit: lawfirmbarbara.wpengine.com or Contact: Barbara Hendrickson E: [bhendrickson@baxsecuritieslaw.com](bhendrickson@baxsecuritieslaw.com) P: 416.601.1004 or M: 647.403.4606 **Categories:** News & Updates --- ### [BAX Securities Law announces ongoing sponsorship of the TBLA](https://baxsecuritieslaw.com/bax-securities-law-announces-ongoing-sponsorship-of-the-tbla/) **Published:** September 16, 2018 **Author:** Barbara Hendrickson **Excerpt:** Toronto, September 19, 2018: BAX Securities Law (BAX) is pleased to announce that the firm will be supporting the solo, small and mid size law firm community by providing the annual sponsorship of the Toronto Business Lawyers Association (TBLA), a forum for business lawyers in... **Content:** **Toronto, September 19, 2018:** BAX Securities Law (BAX) is pleased to announce that the firm will be supporting the solo, small and mid size law firm community by providing the annual sponsorship of the Toronto Business Lawyers Association (TBLA), a forum for business lawyers in downtown Toronto and the GTA for business and professional development purposes. **[Click here to open the full article (PDF)](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/09/revised-Bax-_TBLA_sponsorship-announcement.pdf)** **Categories:** News & Updates --- ### [BAX’ Top Dog turns six](https://baxsecuritieslaw.com/bax-top-dog-turns-six/) **Published:** September 19, 2018 **Author:** Barbara Hendrickson **Excerpt:** Toronto: September 18, 2018 - BAX Securities Law wishes to extend birthday wishes to Dirk, who is the Top Dog of BAX Securities Law. Click here to open the full article (PDF) **Content:** **Toronto: September 18, 2018** – BAX Securities Law wishes to extend birthday wishes to Dirk, who is the Top Dog of BAX Securities Law. **[Click here to open the full article (PDF)](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/09/BAX-Securities-Law_Dirk_2018.pdf)** **Categories:** News & Updates --- ### [BAX Securities Law announces appointment of Barbara Hendrickson to CBA's Small, Solo and General Practice executive.](https://baxsecuritieslaw.com/bax-securities-law-announces-appointment-of-barbara-hendrickson-to-cbas-small-solo-and-general-practice-executive/) **Published:** October 2, 2018 **Author:** Barbara Hendrickson **Excerpt:** Toronto, September 19, 2018: BAX Securities Law (BAX) is pleased to announce that Barbara Hendrickson has been appointed as secretary treasurer to the CBA Small solo and General Practice Section Executive for a one-year term. Close to 10,000 CBA members practice at firms with fewer... **Content:** **Toronto, September 19, 2018:** BAX Securities Law (BAX) is pleased to announce that Barbara Hendrickson has been appointed as secretary treasurer to the CBA Small solo and General Practice Section Executive for a one-year term. Close to 10,000 CBA members practice at firms with fewer than 10 lawyers, as solo practitioners or as general practitioners. The CBA Small, Solo and General Practice Section serves the needs of lawyers and notaries in these categories of practice wtih a mandate to: promote participation of small, solo and general practitioners in the CBA; organize professional activities of interest to our Section members; and act as the national voice of small, solo and general practitioners in the CBA. Barbara Hendrickson, Managing Partner of BAX commented, “I am delighted to be appointed to the role of secretary treasurer and to be a valuable part of the executive of the CBA Small Solo and General Practice Section” She added, ” I’m also very pleased to be part of this groups important work and to offer my ongoing commitment to lawyers working in small firms. It aligns well and echo’s my ongoing work and sponsorship of the TBLA.” Barbara previously spent ten years on the Business Law Section board of the CBA including two years as its Chair, further demonstrating her commitment to the business Bar. **About BAX Securities Law** BAX Securities Law (BAX) has a national and cross-border focus and offers corporate and securities advice to its clients operating in a number of areas including the fintech industry (including cryptocurrency), investment funds, real estate syndication and commodities (carbon, energy, and minerals) sectors. It specializes in online offering platforms including crowdfunding and peer-to-peer lending, and acts for public companies, venture capitalists, private equity firms and securities registrants including exempt market dealers. For additional info please visit: lawfirmbarbara.wpengine.com or Contact: Barbara Hendrickson E: bhendrickson@baxsecuritieslaw.com P: 416.601.1004 or M: 647.403.4606 **Categories:** News & Updates **Tags:** CBA solo firms small firms secretary treasurer --- ### [Canadian Securities Administrators issue CSA Multilateral Staff Notice 58-310, Report on Fourth Staff Review of Disclosure regarding Women on Boards and in Executive Officer Positions](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-csa-multilateral-staff-notice-58-310-report-on-fourth-staff-review-of-disclosure-regarding-women-on-boards-and-in-executive-officer-positions/) **Published:** October 3, 2018 **Author:** Barbara Hendrickson **Excerpt:** On September 27, 2018, the securities regulators of Alberta, Manitoba, New Brunswick, Nova Scotia, Ontario, Quebec and Saskatchewan (the participating jurisdictions) jointly published CSA Multilateral Staff Notice 58-310 Report on Fourth Staff Review of Disclosure regarding Women on Boards and in Executive Officer Positions (The... **Content:** On September 27, 2018, the securities regulators of Alberta, Manitoba, New Brunswick, Nova Scotia, Ontario, Quebec and Saskatchewan (the participating jurisdictions) jointly *published CSA Multilateral Staff Notice 58-310 Report on Fourth Staff Review of Disclosure regarding Women on Boards and in Executive Officer Positions* (The Staff Notice). This is the fourth review by the participating jurisdictions of disclosure of women on boards and in executive officer roles of reporting issuers since 2015, when *National Instrument 58-101 Disclosure of Corporate Governance Practices* was published. The Staff Notice summarizes the results of a review of issuers with year-ends between December 31, 2017, and March 31, 2018. Key takeaways include: - The total percentage of board seats held by women rose to 15% in 2018, up from 11% in 2015. - When board seats became available and were filled, almost 30% were filled by women. - The number of issuers with at least one woman on their board increased to 66% in 2018, rising from 49% in 2015. - 42% of issuers had adopted a policy on identifying and nominating women directors in 2018, representing an almost threefold increase since 2015. - Issuers that adopted targets for the representation of women on their boards increased to 16% in 2018 from 7% in 2015. - The number of issuers with at least one woman in executive officer positions increased to 66% in 2018, up from 60% in 2015, with 4% of issuers having a female CEO and 14% of issuers having a female CFO. CSA staff noted that the manufacturing and real estate industries had the highest percentage of issuers with one or more women in executive officer positions, while the technology, oil and gas and mining industries had the lowest percentage. Going forward, the CSA says it will continue to conduct further research and analysis in this area and based on this work, may determine if further changes to the regulatory regime are warranted. It points out at this time, that no changes are forthcoming. *CSA Multilateral Staff Notice 58-310*[ is available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_sn_20180927_58-310_staff-review-women-on-boards.htm) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [Real Estate Syndication - the use of REITs and Limited Partnerships October 1, 2018](https://baxsecuritieslaw.com/real-estate-syndication-the-use-of-reits-and-limited-partnerships-october-1-2018/) **Published:** October 3, 2018 **Author:** Barbara Hendrickson **Excerpt:** In recent years the use of REITs and Limited Partnerships have expanded in the last few years and investments in real estate through these types of structure have become a common way for investors to participate in real estate projects. The attached presentation provide a... **Content:** In recent years the use of REITs and Limited Partnerships have expanded in the last few years and investments in real estate through these types of structure have become a common way for investors to participate in real estate projects. The attached presentation provide a overview of these investment structures. ## [**Click here for full PDF presentation**](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/10/Real-Estate-Syndication-2021-updated.pdf) **Categories:** News & Updates --- ### [Canadian Securities Administrators issue CSA Staff Notice 51-357 Staff Review of Reporting Issuers in the Cannabis Industry](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-csa-staff-notice-51-357-staff-review-of-reporting-issuers-in-the-cannabis-industry/) **Published:** October 16, 2018 **Author:** Barbara Hendrickson **Excerpt:** On October 10, 2018, with a week remaining before cannabis becomes legalized, the Canadian Securities Administrators (CSA) issued CSA Staff Notice 51-357 Staff Review of Reporting Issuers in the Cannabis Industry (The Staff Notice). CSA staff reviewed the disclosure of 70 reporting issuers in the... **Content:** On October 10, 2018, with a week remaining before cannabis becomes legalized, the Canadian Securities Administrators (CSA) issued *CSA Staff Notice 51-357 Staff Review of Reporting Issuers in the Cannabis Industry* (The Staff Notice). CSA staff reviewed the disclosure of 70 reporting issuers in the cannabis industry, with the intent of highlighting good disclosure practices for these issuers so that investors may make informed investment decisions based on transparent information about financial performance, risks, and uncertainties. Of the 70 issuers, 21 were licensed cannabis producers (LPs), 23 had U.S. related cannabis activities, and 31 were classified as other cannabis-related issuers. Key findings include: - LPs often did not provide sufficient information in their financial statements and management’s discussion and analysis (MD&A) for an investor to understand their financial performance; - While International Financial Reporting Standards (IFRS) require issuers to record growing cannabis plants at their fair value, CSA staff found that all of the LPs they surveyed needed to improve their fair value and fair value-related disclosures. Most specifically: - 100% of LPs had issues with their fair value measurement processes; - 71% of LPs had issues regarding the impact of fair value accounting on their financial statements; - 95% of LPs had issues regarding their accounting policies related to biological assets; - 52% expensed costs related to biological assets; and, - 38% of LPs had non-GAAP (Generally Accepted Accounting Principles) measures in place to deal with fair value. - Some issuers did not consistently comply with securities requirements for forward-looking information, guidance for providing balanced disclosure and certain other requirements; and, - CSA staff found that 74% of issuers with cannabis operations in the U.S. did not provide sufficient disclosure about the risks related to their U.S. operations to satisfy the disclosure expectations set out in [*CSA Staff Notice 51-352 (Revised) Issuers with U.S. Marijuana-Related Activities*](https://www.osc.gov.on.ca/documents/en/Securities-Category5/csa_20180208_51-352_marijuana-related-activities.pdf). CSA staff reported that where insufficient disclosure was found, the issuers in question either promised prospective improvements or in the more serious cases, refiled documents. *CSA Staff Notice 51-357* [ is available for download](https://www.bcsc.bc.ca/51-357_%5bCSA_Staff_Notice%5d_10102018/) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators issue CSA Staff Notice 11-338 CSA Market Disruption Coordination Plan](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-csa-staff-notice-11-338-csa-market-disruption-coordination-plan/) **Published:** October 22, 2018 **Author:** Barbara Hendrickson **Excerpt:** On October 18, 2018, the Canadian Securities Administrators (CSA) published CSA Staff Notice 11-338, CSA Market Disruption Coordination Plan (The Staff Notice), detailing the CSA’s plans to deal with a disruption in the Canadian capital markets, including one that stems from a large-scale cybersecurity incident.... **Content:** On October 18, 2018, the Canadian Securities Administrators (CSA) published *CSA* *Staff Notice 11-338, CSA Market Disruption Coordination Plan* (The Staff Notice), detailing the CSA’s plans to deal with a disruption in the Canadian capital markets, including one that stems from a large-scale cybersecurity incident. In the Staff Notice, CSA staff note that market participants face potential risks relating to systems integrity and that the CSA has undertaken a number of measures related to systems requirements and cybersecurity to bolster the resilience of the capital markets in Canada and mitigate risk, as detailed, for example, in National Instrument 21-101 *Marketplace Operation* (NI 21-101) and National Instrument 24-102 *Clearing Agency Requirements* (NI 24-102). National Instrument 31-103 *Registration Requirements, Exemptions, and Ongoing Registrant Obligations* (NI 31-103) also include internal controls and systems requirements applicable to registrants. Focusing on cybersecurity issues, the CSA has published two separate staff notices dealing with the matter, *CSA Staff Notice 11-326* *Cyber Security* (the 2013 Notice) and *CSA Staff Notice 11-332 Cyber Security* (the 2016 Notice) and has hosted a roundtable of market participants and other stakeholders in 2017 and published *CSA Staff Notice 11-336* *Summary of CSA Roundtable on Response to Cyber Security Incidents* as a result of this meeting. The CSA defines a market disruption event as an event or series of events that prevent market participants from operating in a regular manner. While CSA staff note that while it is not possible to anticipate all market disruption events, they do note some possible disruption events, including those stemming from cybersecurity incidents, physical disasters, major geopolitical events, critical infrastructure disruptions, default of a key or integrated investment dealer, and disruptions on foreign marketplaces. The overarching goal of the CSA is to ensure that markets continue to be fair, efficient and orderly, and overall market integrity is not compromised. An incident, such as a material systems failure, malfunction, delay or security breach, may not qualify as a market disruption event, but still will be material if the marketplace or clearing agency in the normal course of events would inform its senior management responsible for technology. Each registrant is required to notify its respective regulator when it experiences a material systems incident. Prompt notification of a material systems incident will put CSA staff on alert and, accordingly, they can consider whether the incident has market-wide implications, and thus qualify as a market disruption event. In the event of a market disruption, CSA staff will identify the relevant actions that should be undertaken until an affected regulated entity has normalized operations. CSA staff have developed specific procedures for a cybersecurity event, that emphasize the speed at which the disruption advances, the risk of contagion and communication with other relevant federal and provincial organizations. The CSA notes that when responding to an incident, it will first consider its materiality. CSA staff will gather information regarding the developing situation and, if necessary, will take action. In the event of a market disruption, the CSA will work with the participating jurisdictions and other external parties, including IIROC, MFDA, CIPF, OSFI and the Bank of Canada, where appropriate, and developing recommendations for determining an appropriate course of action. *CSA Staff Notice 11-338* [ is available for download](https://www.bcsc.bc.ca/11-338_%5bCSA_Staff_Notice%5d_10182018/) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators issue CSA Notice and Request for Comment Proposed Amendments to National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations - Custody-Related Amendments](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-csa-notice-and-request-for-comment-proposed-amendments-to-national-instrument-31-103-registration-requirements-exemptions-and-ongoing-registrant-obligations/) **Published:** November 1, 2018 **Author:** Barbara Hendrickson **Excerpt:** On October 25, 2018, the Canadian Securities Administrators (CSA) published CSA Notice and Request for Comment Proposed Amendments to National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations – Custody Related Amendments (The Proposed Custody Amendments).  All comments on the Proposed Custody Amendments must... **Content:** On October 25, 2018, the Canadian Securities Administrators (CSA) published *CSA Notice and Request for Comment Proposed Amendments to National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations – Custody Related Amendments* (The Proposed Custody Amendments). All comments on the Proposed Custody Amendments must be submitted by December 24, 2018. The Proposed Custody Amendments are being published for comment as the result of recent changes to the custody-related amendments of National Instrument 81-102 Investment Funds (NI 81-102). This was part of a larger “Modernization of Investment Fund Product Regulation – Alternative Funds” project (the NI 81-102 Amendments). The NI 81-102 Amendments describe the current relief granted regarding the use of cleared derivatives by investment funds under NI 81-102. Section 6.8 of NI 81-102 was also amended to allow these investment funds to deal with futures commission merchants and clearing corporations in accordance with the rules of those organizations for cleared over-the-counter derivatives. The NI 81-102 Amendments in their final form were published on October 4, 2018. The goal of the Proposed Custody Amendments is to give all clients and investment funds of registered firms the same ability to deposit assets with certain dealers of cleared over-the-counter derivatives. Without the Proposed Custody Amendments, this option would only be available to investment funds that fall under NI 81-102. Generally, this is a summary of the Proposed Custody Amendments: - Subsection 14.6.1(1) being amended to add the following two definitions: “cleared specified derivative” and “regulated clearing agency;” - Subsection 14.6.1(2) is being expanded to permit clients or investment funds of a registered firm to deposit cash or securities with members of regulated clearing agencies in respect of certain prescribed margin transactions outside of Canada; and, - Subsection 14.6.1(2) is also being expanded to include an additional type of permitted margin transaction, namely, transactions involving cleared specified derivatives. *The Proposed Custody Amendments to National Instrument 31-103* [are available for download](https://www.bcsc.bc.ca/31-103_%5bCSA_Notice_and_Request_for_Comment%5d_10252018.aspx) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates **Tags:** BAXSecurtiesLaw, clearedoverthecounterderivatives. CSA, Proposed Amendments to National Instrument 31-103 #ProposedCustodyAmendments --- ### [Ontario Securities Commission Launches Two Cryptoasset Educational Initiatives](https://baxsecuritieslaw.com/ontario-securities-commission-launches-two-cryptoasset-educational-initiatives/) **Published:** November 9, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) today launched two cryptoasset educational initiatives as part of its activities for Financial Literacy Month. The first, GetSmarterAboutCrypto.ca provides investors with an overview of cryptoasset products and services, the OSC’s role in regulating them, and tips for exercising due diligence... **Content:** The Ontario Securities Commission (OSC) today launched two cryptoasset educational initiatives as part of its activities for Financial Literacy Month. The first, [GetSmarterAboutCrypto.ca](http://www.getsmarteraboutcrypto.ca/) provides investors with an overview of cryptoasset products and services, the OSC’s role in regulating them, and tips for exercising due diligence before considering this type of investment. The second, [TBACoin.ca](http://www.tbacoin.ca) shows what a typical fraudulent initial coin offering (ICO) website may look like and to help those interested in this type of capital raising tool identify potential red flags. The widespread promotion and growth of the ICO market, coupled with a relatively low understanding of cryptoassets among the general public, which provides fertile ground for fraudsters to take advantage of Main Street investors has prompted the OSC to redouble its educational efforts. An OSC study, published in June 2018, found that five percent of Ontario adults, translating to about 500,000 Ontarians, own cryptoassets, with half of this group spending $1,000 or more on purchasing these products. Of all Ontario adults, men aged 18-34 were three times more likely to report owning cryptoassets. According to the OSC, this research results shows that Ontarians are very interested in blockchain technology and new ways of capital raising. 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. **Categories:** News & Updates **Tags:** BAXSecurtiesLaw, Blockchain, Cryptoassets, Cryptocurrency, Fintech, OSC --- ### [Canadian Securities Administrators Publish Amendments to Finalize Alternative Mutual Funds Framework](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-amendments-to-finalize-alternative-mutual-funds-framework/) **Published:** November 9, 2018 **Author:** Barbara Hendrickson **Excerpt:** On October 4, 2018, the Canadian Securities Administrators (CSA) published CSA Notice of Amendments, Modernization of Investment Fund Product Regulation – Alternative Mutual Funds (the Amendments). The Amendments establish a comprehensive framework for alternative mutual funds and streamline the regulation of non-redeemable investment funds. The... **Content:** On October 4, 2018, the Canadian Securities Administrators (CSA) published *CSA Notice of Amendments, Modernization of Investment Fund Product Regulation – Alternative Mutual Funds* (the Amendments). The Amendments establish a comprehensive framework for alternative mutual funds and streamline the regulation of non-redeemable investment funds. The Amendments are subject to approval and possible changes but are expected to enter into force January 3, 2019. Briefly, the Amendments: - rename “commodity pools” as “alternative mutual funds” and modernize the regulatory regime governing these products by moving most of the regulatory framework in National Instrument 81-104 *Commodity Pools* into National Instrument 81-102 *Investment Funds;* - update the investment restrictions for alternative mutual funds, allowing greater flexibility with investing strategies and focusing on those typically associated with “liquid alternatives.” The updates include increased concentration limits, more flexibility for fund-of-fund investing, an increased ability to borrow cash for investing purposes, and increased flexibility to short-sell and around the use of derivatives, amongst others; - simplify the prospectus requirements for alternative mutual funds by fully bringing them within the prospectus disclosure regime applicable to other mutual funds. Similar investment restrictions are also being introduced for non-redeemable investment funds; and, - include changes that will codify certain routine exemptive relief granted to mutual funds. The Amendments [are available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20181004_81-102_alternative-mutual-funds.htm) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates **Tags:** Alternative mutual funds, Amendments, BAXSecurtiesLaw, CSA, Investment funds, Mutual funds --- ### [The Cooperative Capital Markets Regulatory System held upheld by the Supreme Court of Canada](https://baxsecuritieslaw.com/the-cooperative-capital-markets-regulatory-system-held-upheld-by-the-supreme-court-of-canada/) **Published:** November 13, 2018 **Author:** Barbara Hendrickson **Excerpt:** The Supreme Court of Canada (“SCC”) on November 9, 2018 released its written decision on the Cooperative Capital Markets Regulatory System (“CCMR”) and the proposals of the federal government and the governments of Ontario, British Columbia, Saskatchewan, New Brunswick, Prince Edward Island, and Yukon to... **Content:** The Supreme Court of Canada (“SCC”) on November 9, 2018 released its written decision on the Cooperative Capital Markets Regulatory System (“CCMR”) and the proposals of the federal government and the governments of Ontario, British Columbia, Saskatchewan, New Brunswick, Prince Edward Island, and Yukon to implement a national cooperative system for the regulation of capital markets in Canada. The framework of the CCMR is set out in an agreement between the federal government and the participating provincial and territorial governments (the “Memorandum”), first signed in September 2014 , and includes a model provincial and territorial statute (the “Model Provincial Act”) that deals primarily with the day-to-day aspects of the securities trade, a proposed federal statute (the “Draft Federal Act”) that is aimed at preventing and managing systemic risk and which establishes criminal offences relating to financial markets, and a national securities regulator (the “Authority”) charged with administering this coordinated regime. The Authority and its board of directors are to operate under the supervision of a Council of Ministers, which will comprise the ministers responsible for capital markets regulation in each participating province and the federal Minister of Finance. In July, 2015, the Government of Quebec referred the following two questions pertaining to the CCMR to the Quebec Court of Appeal: • Does the Constitution of Canada authorize the implementation of pan-Canadian securities regulation under the authority of a single regulator, according to the model established by the most recent publication of the “Memorandum of Agreement regarding the Cooperative Capital Markets Regulatory System?” • Does the most recent version of the draft of the federal “Capital Markets Stability Act” exceed the authority of the Parliament of Canada over the general branch of the trade and commerce power under [subsection 91(2)](https://qweri.lexum.com/w/calegis/30---31-vict-c-3-en#!fragment/sec91subsec2/BQCwhgziBcwMYgK4DsDWszIQewE4BUBTADwBdoJC4BOARgkQCNK4AmASgBpltTCIAiokK4AntADkEzhDi5sAGwUBhJGmgBCZDMJhcCISPFSdehAGU8pAELiASgFEAMg4BqAQQByyh51JhGaFJsOHZ2IA) of the [Constitution Act, 1867](https://qweri.lexum.com/w/calegis/30---31-vict-c-3-en#!fragment/I__PRELIMINARY__3203/BQCwhgziBcwMYgK4DsDWszIQewE4BUBTADwBdoBJAfSoAUAlAUQBkKBZCgOQEF6BNGgGYATAAZBASgA0ybKUIQAiokK4AntADkmqRDi5sAG0MBhJGmgBCZLsJhcCZao3bb9hAGU8pAEIamzIwAatycJoxSpGAARtCk2HASEkA) (“Constitution Act”)? A majority of the Quebec Court of Appeal answered both questions in the negative. The Government of Quebec subsequently appealed this ruling to the SCC. In its ruling on the appeal from the decision of the Quebec Court of Appeal, the SCC held that: • Question 1 should be answered in the affirmative; and, • Question 2 should be answered in the negative. The SCC held that the Constitution Act authorizes the implementation of pan-Canadian securities regulation under the authority of a single regulator in accordance with the terms set out in the Memorandum. The CCMR, as set out in the Memorandum, does not purport to — and in any event, cannot — improperly fetter the legislatures’ sovereignty. The CCMR does not entail an impermissible delegation of law-making authority. The SCC also held that the proposed Draft Federal Act is intra vires; as it falls within the general branch of Parliament’s trade and commerce under the Constitution Act. The pith and substance of the Draft Federal Act is to control systemic risk having the potential to create material adverse effects on the Canadian economy and the federal government’s role in regulating capital markets under the Draft Federal Act is limited to the detection, prevention and management of risk to the stability of the Canadian economy, as well as to the protection against financial crimes. The concept of systemic risk is specifically invoked throughout the Draft Federal Act as a means of limiting the scope of federal regulatory powers. According to the SCC, systemic risk can be understood as having three constituent elements: the risk must represent a threat to the stability of the country’s financial system as a whole; it must be connected to the capital markets; and it must have the potential to have a material adverse effect on the Canadian economy. The intention of the Draft Federal Act on the face of the legislation is to address economic objectives that are considered to be national in character. The preservation of the integrity and stability of the Canadian economy quite clearly has a national dimension, and one which lies beyond provincial competence. Lastly, the SCC held that the manner in which the Draft Federal Act delegates the power to make regulations accords with Parliament’s constitutional powers. The delegation of administrative powers in a manner solicitous of (or even dependent upon) provincial input is in no way incompatible with the principle of federalism, provided that the delegating legislature has the constitutional authority to legislate in respect of the applicable subject matter in the first place. For the full text of the SCC decision please see: 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. **Categories:** News & Updates --- ### [Securities and Exchange Commission Charges EtherDelta Founder with Operating Unregistered Exchange](https://baxsecuritieslaw.com/bax-securities-and-exchange-commission-charges-etherdelta-founder-with-operating-unregistered-exchange/) **Published:** November 21, 2018 **Author:** Barbara Hendrickson **Excerpt:** Earlier this month, the United States Securities and Exchange Commission (SEC) announced settled charges against the founder of a digital token trading platform, EtherDelta, Zachary Coburn with operating an unregistered national securities exchange. This is the SEC’s first enforcement order against such a platform operating... **Content:** Earlier this month, the United States Securities and Exchange Commission (SEC) announced settled charges against the founder of a digital token trading platform, EtherDelta, Zachary Coburn with operating an unregistered national securities exchange. This is the SEC’s first enforcement order against such a platform operating as an unregistered national securities exchange. In its investigation, the SEC found that EtherDelta is an online platform for secondary market trading of ERC20 tokens, a type of blockchain-based token commonly issued in Initial Coin Offerings (ICOs). The SEC found that Coburn caused EtherDelta to operate as an unregistered national securities exchange. Without admitting or denying the SEC’s findings, Coburn consented to the SEC’s enforcement order and agreed to pay $300,000 in disgorgement plus $13,000 in prejudgment interest and a $75,000 penalty. The Commission’s order recognizes Coburn’s cooperation, which the Commission considered in determining not to impose a greater penalty. **Background:** EtherDelta provided a marketplace for bringing together buyers and sellers for digital asset securities through the combined use of an order book, a website that displayed orders, and a “smart contract” run on the Ethereum blockchain. EtherDelta’s smart contract was coded to validate the order messages, confirm the terms and conditions of orders, execute paired orders, and direct the distributed ledger to be updated to reflect a trade. Over an 18-month period, the SEC found that EtherDelta’s users executed more than 3.6 million orders for ERC20 tokens, including tokens that are securities under the federal securities laws. Almost all of the orders placed through EtherDelta’s platform were traded after the SEC issued its 2017 report which found that certain digital assets such as DAO (Decentralized Autonomous Organization) tokens, were securities and that platforms that offered trading of these digital asset securities would be subject to the SEC’s requirement that exchanges register or operate pursuant to an exemption. This became the basis of the SEC’s subsequent finding that EtherDelta offered trading of various digital asset securities but failed to register as an exchange or operate pursuant to an exemption. The SEC has previously bought enforcement actions to unregistered broker-dealers and unregistered ICOs, including some of the tokens traded on EtherDelta. 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. **Categories:** News & Updates **Tags:** BAX Securities Law, Crytptocurrency, ERC20, EtherDelta, Fintech, ICO, SEC --- ### [Ontario Sets Out Regulations for the Licensing and Operation of Private Cannabis Stores](https://baxsecuritieslaw.com/ontario-sets-out-regulations-for-the-licensing-and-operation-of-private-cannabis-stores/) **Published:** November 26, 2018 **Author:** Barbara Hendrickson **Excerpt:** On November 14, 2018, the Ontario Government set forth the regime for the licensing and operation of private cannabis stores under Ontario Regulation 468/18 (the Regulation) made under the Cannabis Licence Act, 2018 (the License Act). Generally, the Regulation: establishes a minimum distance of 150... **Content:** On November 14, 2018, the Ontario Government set forth the regime for the licensing and operation of private cannabis stores under Ontario Regulation 468/18 (the Regulation) made under the Cannabis Licence Act, 2018 (the License Act). Generally, the Regulation: - establishes a minimum distance of 150 metres (approximately 500 feet) between cannabis retail stores and schools, including private and federally-funded First Nation schools off-reserve; - prohibits anyone under the age of 19 from entering a retail cannabis store; - denies cannabis licenses to certain applicants, including those guilty of cannabis-related criminal offences. This also extends to those illegal cannabis retailers who were operating after October 17, 2018; - prohibits the issuance of a licence to any individual or organization who has an association with organized crime; - requires that individuals or entities applying for an operator licence demonstrate their tax compliance status to show that they are in good standing with the government; - sets forth allowable business hours of between 9am and 11pm and requires licensed stores to prominently display the provincial cannabis retail seal; - contains a requirement for all private recreational cannabis retail storefronts to be stand-alone stores only; and, - requires that individuals with a store authorization, cannabis retail managers, and all retail employees will be required to complete the approved training to ensure that any individual who works in the cannabis retail market is trained in the responsible sale of cannabis. The application process for private retail cannabis stores in Ontario begins on December 17, 2018, with the private retail model expected to be established by April 1, 2019. These stores will operate under the auspices of the Alcohol and Gaming Commission of Ontario (AGCO). *Ontario Regulation 468/18 can be* [*downloaded from here*](https://www.ontario.ca/laws/regulation/r18468)*.* 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. **Categories:** News & Updates **Tags:** BAX Securities Law, Cannabis, Ontario Regulation 468/18, Private Cannabis Stores --- ### [BCSC Finds Increased Deficiencies in Compliance Among Portfolio Managers](https://baxsecuritieslaw.com/bcsc-finds-increased-deficiencies-in-compliance-among-portfolio-managers/) **Published:** December 1, 2018 **Author:** Barbara Hendrickson **Excerpt:** The British Columbia Securities Commission (BCSC) reports that it has found an increased number of deficiencies in compliance among portfolio managers during 2018. The BCSC published these findings in its 2018 BCSC Annual Compliance Report Card (the Report Card). In 2018, the BCSC conducted 23... **Content:** The British Columbia Securities Commission (BCSC) reports that it has found an increased number of deficiencies in compliance among portfolio managers during 2018. The BCSC published these findings in its 2018 BCSC Annual Compliance Report Card (the Report Card). In 2018, the BCSC conducted 23 compliance reviews and found 151 deficiencies, averaging 6.57 deficiencies per review. Although that number was down slightly from 2017 with 6.58 deficiencies per review, it is an increase from 4.29 in 2016, and 4.64 in 2015. Among the most common types of deficiencies were questionable risk management, outdated manuals, and weak cybersecurity policies and procedures. Other common problems included inadequate disclosure, especially about the registrant-client relationship, and patchy efforts to ensure the suitability of investments for each client. As a result of these ongoing reviews, the BCSC imposed extra restrictions on two firms, one of which decided to surrender its registration as a result. Two other firms chose to give up their registrations while still being reviewed. The BCSC is increasingly referring the most egregious cases of non-compliance to its enforcement team for further investigation and possible penalties, including suspension or bans from the capital markets, as well as fines. In 2018, the BCSC opened investigations into four cases that began as compliance reviews. The 2018 BCSC Annual Compliance Report Card [is available for download](http://www.bcsc.bc.ca/uploadedFiles/For_Registrants/F_Report_card_NOV_2018_.pdf) from the website of 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. **Categories:** News & Updates **Tags:** BAX Securities Law, BCSC, Compliance Report Card --- ### [The Licences and Authorizations you need from the AGCO, December 8, 2018](https://baxsecuritieslaw.com/the-licences-and-authorizations-you-need-from-the-agco-december-8-2018/) **Published:** December 10, 2018 **Author:** Ray Luckiram **Excerpt:** Over the next few weeks, the Alcohol and Gaming Commission of Ontario (“AGCO”) will be updating its online Cannabis Retail Regulation Guide (“Cannabis Guide”). The Cannabis Guide will be continually updated as information becomes available on the application process for retail cannabis licenses. The new retail scheme will allow stores... **Content:** Over the next few weeks, the Alcohol and Gaming Commission of Ontario (“AGCO”) will be updating its online [*Cannabis Retail Regulation Guide*](https://www.agco.ca/cannabis/guides/cannabis-retail-regulation-guide) (“*Cannabis Guide*”). The *Cannabis Guide* will be continually updated as information becomes available on the application process for retail cannabis licenses. The new retail scheme will allow stores to open their doors on April 1, 2019. However, the licensing application process will open in December, 2018. In Ontario, Cannabis can only be sold by licensed and authorized retailers approved by the AGCO. All licensed retailers must have a supply purchase contract with the Ontario Cannabis Retail Store (OCS). Only cannabis obtained through the OCS can be sold by licensed retailers. Further, the AGCO recently published the [*Registrar’s Standards for the Private Retail Sale of Cannabis*](https://www.agco.ca/content/registrars-standards-private-retail-sale-cannabis)*.* Currently, the AGCO has established three different licenses: Retail Operator License, Retail Store Authorization and a Cannabis Retail Manager License. The requirements of each license are set out in the [*Cannabis Licence Act, 2018*](https://www.ontario.ca/laws/statute/S18012) (*Cannabis License Act)* and the *Registrar’s Standards for the Private Retail Sale of Cannabis (Registrar’s Standards)*. **Retail Operator Licence** The Retail Operator Licence is required to legally open a retail store selling recreational cannabis. To attain this license, the eligibility criteria set out in the *Cannabis License Act* must be met. A Retail Operator Licence allows you to operate one or more retail stores in Ontario. However, each store will require a Retail Store Authorization. **Requirements** There are several restrictions on applicants of a Retail Operator License. For example, applicants will not be eligible for a Retail Operator Licence if they are under the age of 19. In the case of corporate applicants, all directors, officers and shareholders must be over 19. Convictions or charges under certain legislation will limit eligibility, such as any offence under the *Cannabis Licence Act*, certain offences under the *Cannabis Control Act* and *Cannabis Act*, and certain roles or connections with a criminal organization as defined in subsection 467.1(1) of the *Criminal Code (Canada).* Failure to file personal or business tax returns will also affect eligibility. Additionally, if more than 9.9 percent of the corporation is owned or controlled, either directly or indirectly, by a licensed producer or their affiliate, the corporation will not be eligible. For the full set of requirements of eligibility, see the *Cannabis Guide* and the *Cannabis License Act.* **Retail Store Authorization** As each retail location must satisfy a specific set of requirements under the *Cannabis Licence Act*, a Retail Store Authorization is required for each store. However, there is a limit of 75 Retail Store Authorizations per individual, corporation and any of their affiliates. Municipalities and band councils of First Nation reserves may also opt-out of the legislation to stop the establishment of retail stores within their boundaries. **Requirements** Many of the requirements of eligibility are related to the requirements of a Retail Operator License. Additional requirements based on store layout and location are set out in the *Registrar’s Standards for the Private Retail Sale of Cannabis* and the *Cannabis Licence Act.* This includes a limitation on the proximity to a school. In addition, after an application for a Retail Store Authorization, the Registrar of the AGCO will inform residents and the municipality of the proposed location by a posted notice. The municipality and local residents will have 15 calendar days after the notice is posted to submit written submissions to the Registrar in respect to the public interest. Specifically, the public interest will be based on protecting public health & safety, protecting youth and restricting their access to cannabis, and preventing illicit activities in relation to cannabis. If the Registrar determines that a location is not in the public interest based on the need of the people who live in the municipality, it will not be eligible for a Retail Store Authorization. **Cannabis Retail Manager Licence** Each authorized store location must have one licensed manager. The *Cannabis Licence Act* sets out the eligibility criteria for the persons in the management role. The manager with a Cannabis Retail Manager License will be responsible for cannabis inventory, hiring and managing employees, managing compliance issued relating cannabis, entering into contracts for the store and ensuring the store operates with honesty and integrity at all times. **Requirements** To obtain a Cannabis Retail Manager License, an individual must be 19 years of age. Also, they cannot have been convicted of any offence under the *Cannabis Licence Act*, certain offences under the *Cannabis Control Act* and *Cannabis Act* or certain roles or connections with a criminal organization as defined in subsection 467.1(1) of the Criminal Code (Canada): - you are, or have been a member of the criminal organization - you are, or have been involved in the criminal organization - you contribute, or have contributed to, the activities of the organization. The *Cannabis Guide* outlines the fees associated with each license: **Initial Fee 2-year term****Renewal Fee 2-year term****Renewal Fee 4-year term****Retail Operator License**$6,000$2,000$4,000**Retail Store Authorization**$4,000$3,500$7,000**Cannabis Retail Manager License**$750$500$1,000[*\* If you are a sole proprietor or in a partnership between two or more individuals, and will be both the licensed operator and performing the duties of the retail store manager for a particular store, you will not need to get a Cannabis Retail Manager Licence for that store.*](https://www.agco.ca/content/fees-and-payment) For more information, please call Barbara Hendrickson at BAX Securities Law (416) 601 -1004 or Ray Luckiram (416) 601-0591. 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. **Categories:** News & Updates **Tags:** Cannabis License Act, Cannabis Retail Regulation Guide, Retail Operator License, Retail Store Authorization --- ### [Changes made to the Retail Ontario Cannabis Licensing Regime](https://baxsecuritieslaw.com/changes-made-to-the-retail-ontario-cannabis-licensing-regime/) **Published:** December 16, 2018 **Author:** Ray Luckiram **Excerpt:** On December 13, 2018, the Government of Ontario announced changes to the retail licensing scheme of cannabis. The government will issue 25 licenses to retail outlets. The changes come three days before the portal for applications was set to be open.  The government based its... **Content:** On December 13, 2018, the Government of Ontario announced changes to the retail licensing scheme of cannabis. The government will issue 25 licenses to retail outlets. The changes come three days before the portal for applications was set to be open. The government based its decision on a national shortage in the supply of cannabis. In addition, only six licenses will be available in the GTA and five license for Toronto, according to Ontario Regulation 497/18 made under the [Cannabis License Act, 2018](https://www.ontario.ca/laws/regulation/r18497). Initial license holders will be able to open their stores on April 1, 2019. The demand for the licenses will greatly outweigh the number of applicants. To distribute the licenses, the AGCO will conduct a lottery. Expression of interests may be submitted to the AGCO from January 7 to January 9, 2019. The province and AGCO will use a third-party monitor to oversee the lottery process. The lottery process aims to ensure fairness and transparency in the treatment of the expressions of interest, as well as an appropriate distribution of stores in each region of the province. Eventually, the AGCO will publish more details on the lottery process. For more information, please call Barbara Hendrickson at BAX Securities Law (416) 601 -1004 or Ray Luckiram at (416) 601-4651. 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. **Categories:** News & Updates **Tags:** Cannabis, Cannabis License Act 2018, Retail Cannabis License --- ### [BCSC Publishes Notice of Amendments to National Instrument NI 41-101, Prospectus Requirements](https://baxsecuritieslaw.com/bcsc-publishes-notice-of-amendments-to-national-instrument-ni-41-101-prospectus-requirements/) **Published:** December 27, 2018 **Author:** Barbara Hendrickson **Excerpt:** The British Columbia Securities Commission (BCSC) has published updates to National Instrument, N1 41-101, Prospectus Requirements (NI 41-101). These non-material amendments, which deal with Exchange Traded Funds (ETFs), became effective, December 10, 2018. The Amendments to NI 41-101: add a BC carve-out to the meaning... **Content:** The British Columbia Securities Commission (BCSC) has published updates to National Instrument, N1 41-101, Prospectus Requirements (NI 41-101). These non-material amendments, which deal with Exchange Traded Funds (ETFs), became effective, December 10, 2018. The Amendments to NI 41-101: - add a BC carve-out to the meaning of a dealer acting as agent of the purchaser in section 6 of NI 41- 101, which achieves the objective of introducing a summary disclosure document regime for exchange traded funds under which all dealers who receive an order to buy an ETF must deliver an ETF Facts document to the purchaser. (It should be noted that both Ontario and Québec have this same carve-out); and, - specify that the purchaser’s right of action if an ETF Facts document is not delivered or sent is found in section 135 of the Securities Act (British Columbia). The Notice of Amendments to NI 41-401, Prospectus Requirements [is available for download](https://www.bcsc.bc.ca/Securities_Law/Policies/PolicyBCN/BCN2018/08_Notice_of_Amendments_to_National_Instrument_41-101_General_Prospectus_Requirements_BCN_/) from the website of 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. **Categories:** News & Updates **Tags:** BAX Securities Law, BCSC, NI41-101, Prospectus Requirements --- ### [Ontario Publishes Results of Lottery for Retail Cannabis Store Licenses](https://baxsecuritieslaw.com/ontario-publishes-results-of-lottery-for-retail-cannabis-store-licenses/) **Published:** January 14, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Government has published the results of Expressions of Lottery Interest for retail Cannabis stores (the Lottery) the under Ontario Regulation 468/18 (the Regulation) made under the Cannabis Licence Act, 2018 (the License Act). According to the Alcohol and Gaming Commission of Ontario (AGCO),... **Content:** The Ontario Government has published the results of Expressions of Lottery Interest for retail Cannabis stores (the Lottery) the under Ontario Regulation 468/18 (the Regulation) made under the Cannabis Licence Act, 2018 (the License Act). According to the Alcohol and Gaming Commission of Ontario (AGCO), which oversaw the lottery, on a provincial level, there were 17,320 expressions of interest for the 25 retail storefront cannabis licenses that were issued. Of these, 415 applicants were disqualified under Rules #4, #6, #8, and #9 of the Regulation. Of the remaining 16,905 entrants that were included in the draw, on a regional basis: - In the east region, five applicants were selected out of a total of 11,804 entrants; - In the GTA region, six applicants were selected out of a total of 13,453 entrants; - In the North region, two applicants were selected out of a total of 8,545 entrants; - In the Toronto region, five applicants were selected out of a total of 13,693 entrants; and, - In the West region, seven applicants were selected out of a total of 12,294 entrants. Combined applications across different regions meant that 59,069 regional entries were received by the AGCO. The retail model for cannabis is expected to be established by April 1, 2019. The full list of the results of the expression of lottery interest is [available on the website](https://agco.ca/cannabis/expression-interest-lottery-selection-results?utm_medium=email&utm_campaign=) of the Alcohol and Gaming Commission of Ontario. 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. **Categories:** News & Updates **Tags:** BAX Securities Law, Cannabis, Ontario Regulation468/18, Private Cannabis Stores --- ### [BAX Securities Law’s Barbara Hendrickson Interviewed for Canadian Bar Association News](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-interviewed-for-canadian-bar-association-news/) **Published:** January 17, 2019 **Author:** Barbara Hendrickson **Excerpt:** An article featuring an interview with Barbara Hedrickson, CEO of BAX Securities Law, regarding the November 2018 Supreme Court of Canada (SCC) decision on the constitutionality of Cooperative Capital Markets Regulatory System (CCMR) has been published on the website on the Canadian Bar Association (CBA).... **Content:** An article featuring an interview with Barbara Hedrickson, CEO of BAX Securities Law, regarding the November 2018 Supreme Court of Canada (SCC) decision on the constitutionality of Cooperative Capital Markets Regulatory System (CCMR) has been published on the website on the Canadian Bar Association (CBA). The SCC decision had overturned a previous Quebec Court of Appeal decision which found the CCMR unconstitutional. The full article been published on the [website of the Canadian Bar Association](http://www.cba.org/Publications-Resources/CBA-Practice-Link/Business-and-Corporate/2019/Cooperative-Capital-Markets-Regulatory-System). 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securties Law, CBA News, Cooperative Capital Markets System, SCC --- ### [FINTRAC Publishes New Suspicious Transactions Guidelines](https://baxsecuritieslaw.com/fintrac-publishes-new-suspicious-transactions-guidelines/) **Published:** January 23, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), has published updated suspicious activity guidelines.  FINTRAC is Canada’s financial intelligence unit and is tasked with the detection and prevention of money laundering and the financing of terrorist activities. The new, more concise guidelines include... **Content:** The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), has published updated suspicious activity guidelines. FINTRAC is Canada’s financial intelligence unit and is tasked with the detection and prevention of money laundering and the financing of terrorist activities. The new, more concise guidelines include revisions to: - [What is a is a suspicious transaction report?](http://www.fintrac-canafe.gc.ca/guidance-directives/transaction-operation/Guide2/2-eng.asp) - [Reporting suspicious transactions to FINTRAC](http://www.fintrac-canafe.gc.ca/guidance-directives/transaction-operation/Guide3/str-eng.asp) - [Money laundering and terrorist financing indicators that are sector specific.](http://www.fintrac-canafe.gc.ca/guidance-directives/transaction-operation/1-eng.asp) Although the guidelines have been revised, FINTRAC advises that the reporting obligations of issuers and other organizations and individuals have not changed. 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. **Categories:** News & Updates **Tags:** AML, BAX Securities Law, Financing of Terrorism, FINTRAC, Suspicious transactions --- ### [BCSC Publishes BCN2019/01: Expiry of BC Instrument 32-517 Exemption from Dealer Registration Requirement for Trades in Securities of Mortgage Investment Entities and registration requirements for persons relying on BCI 32-517](https://baxsecuritieslaw.com/bcsc-publishes-bcn2019-01-expiry-of-bc-instrument-32-517-exemption-from-dealer-registration-requirement-for-trades-in-securities-of-mortgage-investment-entities-and-registration-requirements-for-pers/) **Published:** January 24, 2019 **Author:** Barbara Hendrickson **Excerpt:** The British Columbia Securities Commission (BCSC) has published a new policy publication, BCN2019/01: Expiry of BC Instrument 32-517 Exemption from Dealer Registration Requirement for Trades in Securities of Mortgage Investment Entities and registration requirements for persons relying on BCI 32-517 (BCN2019/01). BCN2019/01 addresses the expiry... **Content:** The British Columbia Securities Commission (BCSC) has published a new policy publication, *BCN2019/01: Expiry of BC Instrument 32-517 Exemption from Dealer Registration Requirement for Trades in Securities of Mortgage Investment Entities and registration requirements for persons relying on BCI 32-517* (BCN2019/01). BCN2019/01 addresses the expiry of the dealer registration exemption in section 8 of BC Instrument 32-517 Exemption from Dealer Registration Requirement for Trades in Securities of Mortgage Investment Entities (BCI 32-517), which will occur on February 15, 2019. The BCSC has published BCN2019/01 in a Frequently Asked Question (FAQ) format and is based on the inquiries BCSC staff has received concerning the forthcoming expiry of BCI 32-517 and the registration requirements for persons trading or intending to trade securities of mortgage investment entities (MIEs) in British Columbia. BCN2019/01 [is available for download](https://www.bcsc.bc.ca/BCN_2019_01_01212019/) from the website of 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. **Categories:** News & Updates **Tags:** BAX Securities Law, BCI 32-517, BCN2019/01, BCSC --- ### [New Canada Business Corporations Act Record-Keeping Requirements to Come into Effect June 13th, 2019](https://baxsecuritieslaw.com/new-canada-business-corporations-act-record-keeping-requirements-to-come-into-effect-june-13th-2019/) **Published:** February 4, 2019 **Author:** Barbara Hendrickson **Excerpt:** With the granting of Royal Assent to Bill C-86 Budget Implementation Act, 2018, No. 2 (Bill C-86) on December 13th, 2018 changes are in store for how corporations maintain their records under the Canada Business Corporations Act (CBCA). Division 6 of Part 4 of Bill... **Content:** With the granting of Royal Assent to Bill C-86 Budget Implementation Act, 2018, No. 2 (Bill C-86) on December 13th, 2018 changes are in store for how corporations maintain their records under the Canada Business Corporations Act (CBCA). Division 6 of Part 4 of Bill C-86 (the Division) amends the CBCA to set out criteria for identifying individuals with significant control over a corporation. The Division also sets out a requirement for a corporation that meets certain criteria to keep a register of individuals with significant control and requirements respecting the information to be recorded in it. Finally, the Division includes applicable offences and punishments. Bill C-86 details new CBCA record-keeping requirements. These new provisions are not applicable to “distributing corporations” – those issuers and corporations who typically file documents with a securities commission and do not sell shares on a stock exchanges. Non-distributing corporations governed by the CBCA will be required to maintain a register of all individuals with “significant control” over a “significant number” of share corporation. An individual is deemed to have “significant control” of a corporation if he or she individually or jointly with another is the registered holder of shares, the beneficial owner of shares, has direct or indirect control or direction over shares; or direct or indirect influence that, if exercised, would result in control in fact of the corporation; A significant number of shares of a corporation is any number of shares that carry 25% or more of the voting rights attached to all of the corporation’s outstanding voting shares; or any number of shares that is equal to 25% or more of all of the corporation’s outstanding shares measured by fair market value. All non-distributing CBCA Corporations will be required to prepare and maintain, at their registered office or at any other place in Canada designated by the directors, a register of individuals with significant control over the corporation that contains: (a) the names, the dates of birth and the latest known address of each individual with significant control; (b) the jurisdiction of residence for tax purposes of each individual with significant control; (c) the day on which each individual became or ceased to be an individual with significant control, as the case may be; (d) a description of how each individual is an individual with significant control over the corporation, including, as applicable, a description of their interests and rights in respect of shares of the corporation; (e) any other prescribed information; and, (f) a description of each step taken in accordance with subsection (2), meaning the corporation should prepare and maintain meeting records, minutes and resolutions of the directors and of any committee and should also maintain adequate accounting records. At least once during its financial year, the corporation must take reasonable steps to ensure that it has identified all individuals with significant control over the corporation and that the information in the register is accurate, complete, and up-to-date. All non-distributing CBCA corporations must otherwise update this information within 15 days of becoming aware of it. The information must be retained for 6 years (or such longer period required by applicable law) after the day on which an individual ceases to be an individual with significant control over the corporation. Access to corporate records must be provided to shareholders and creditors of a corporation, their personal representatives and the corporation’s director during the corporation’s usual business hours. These individuals may take extracts from the records, free of charge, and, if the corporation is a distributing corporation, any other person may do so on payment of a reasonable fee. A shareholder of a corporation is also entitled on request and without charge to one copy of the articles and by-laws and of any unanimous shareholder agreement. Anyone wishing to examine the securities register of a corporation must first make a request to the corporation or its agent or mandatary, accompanied by an affidavit. On receipt of the affidavit, the corporation or its agent or mandatary must allow the applicant access to the securities register during the corporation’s usual business hours, and, on payment of a reasonable fee, provide the applicant with an extract from the securities register. Corporations Canada is expected to provide additional information on the creation and maintenance of registers before June 2019. The new record-keeping requirements will come into effect on June 13th, 2019. More information on Bill C-86 can be found on the [Corporations Canada](https://corporationscanada.ic.gc.ca/eic/site/cd-dgc.nsf/eng/cs08123.html) website. 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. **Categories:** News & Updates **Tags:** BAX Securities Law, Bill C86, Canada Business Corporations Act, distributing corporations, Record Keeping --- ### [Death of QuadrigaCX CEO and Bankruptcy Leaves Almost $180 Million in Cryptocurrency Missing](https://baxsecuritieslaw.com/death-of-quadrigacx-ceo-and-bankruptcy-leaves-almost-180-million-in-cryptocurrency-missing/) **Published:** February 8, 2019 **Author:** Barbara Hendrickson **Excerpt:** The death of Canadian crypto exchange QuadrigaCX CEO Gerald Cotton in December 2018 and the platform’s subsequent filing for creditor protection under the Companies' Creditors Arrangement Act (CCAA) on February 5th has left company officials struggling to locate roughly $180 million in missing cryptocurrency. Court... **Content:** The death of Canadian crypto exchange QuadrigaCX CEO Gerald Cotton in December 2018 and the platform’s subsequent filing for creditor protection under the Companies’ Creditors Arrangement Act (CCAA) on February 5th has left company officials struggling to locate roughly $180 million in missing cryptocurrency. Court filings in the Nova Scotia Supreme Court show that QuadrigaCX staff has been so far unable to locate the missing cryptocurrency or an additional $70 million in cash, owed to users. This has resulted in a major cause for concern among Vancouver-based QuadrigaCX’s 115,000-strong user base. Key to the possible location of the missing cryptoassets is an encrypted laptop which has been given to a court-appointed third-party monitor. The laptop was previously held by QuadrigaCX’s representatives. Because the assets are believed to have been stored in an Ethereum cold wallet – which are typically removable media such as USB drives or other external hard drives and are securely stored offsite – the court has acknowledged this is not a typical bankruptcy. Contributing to the problem is that Cotton had sole control of the exchange’s cold wallet private keys. When Cotton died, the company reported it had lost the keys. If the keys are not recovered, QuadrigaCX’s lawyers have stated they will consider selling the exchange in order to pay off its debts. QuadrigaCX’s representatives have asked the court for a 30-day stay of proceedings. 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. **Categories:** News & Updates **Tags:** BAX Securities Law, Cryptocurrency, Ethereum, Fintech, Nova Scotia supreme court, QuadrigaCX --- ### [CSA Staff Notice 51-356 Problematic Promotional Activities by Issuers](https://baxsecuritieslaw.com/csa-staff-notice-51-356-problematic-promotional-activities-by-issuers/) **Published:** February 13, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (“CSA”) has published CSA Staff Notice 51-356, Problematic Promotional Activities by Issuers (“CSA Staff Notice 51-356”).  CSA staff have noted with concern instances by activities by some issuers that include questionable promotional or disclosure campaigns.  These extend to the providing of... **Content:** The Canadian Securities Administrators (“CSA”) has **published** *CSA Staff Notice 51-356, Problematic Promotional Activities by Issuers* (“CSA Staff Notice 51-356”)**.** CSA staff have noted with concern instances by activities by some issuers that include questionable promotional or disclosure campaigns. These extend to the providing of unbalanced or unsubstantiated material claims about the issuer’s businesses and the corresponding opportunity for profit by investing in the issuer, which appear to be undertaken for the specific purpose of artificially promoting interest in the issuer’s securities. CSA staff are further concerned that these activities might artificially inflate the issuer’s share price and trading volume. The CSA warns that any misleading behavior by issuers may result in a regulatory response. The regulator has cited these examples that have given it cause for concern, including the: - issuing of presentations, marketing materials, social media posts, or other information that describes early-stage plans with unwarranted certainty, or make unsupported assertions about growth of markets or demand for a product; - publication of multiple news releases that disclose no new material facts; - compensation of third parties, who use social media and general investing blogs to promote the interests of the issuers, but who do not disclose their relationship, compensation and/or financial interest; - announcing of an issuer name and/or business change to reference an emerging industry or technology such as blockchain, cannabis, battery minerals, or cryptocurrency without a supporting business plan or comprehensive risk disclosure; - announcing of a positive event such as a large acquisition then subsequently changing or cancelling the transaction with no announcement; and, - disclosing of details about mineral projects that: - suggest without direct evidence from sampling or exploration, that a property holds high potential for development including production; - rely on projected peak versus long-term commodity prices; or, - imply that a property holds a specific fair market value without a feasibility report. CSA staff have issued requirements and guidance for promotional and disclosure activities, including: - general prohibitions against false or misleading statements that could significantly impact the price or value of an issuer’s securities; - general prohibitions against acts, practices, or conduct relating to securities that result in or contribute to a misleading appearance of trading activity or an artificial price for a security; - requirements that every investor relations record disseminated by or on behalf of an issuer or security holder must clearly and conspicuously disclose that the record is being issued by or on behalf of that issuer or security holder; - requirements that an issuer must not disclose forward-looking information unless the issuer has a reasonable basis for the information and requirements that any such disclosure must: - identify any forward-looking information; - caution users that actual results may vary from the forward-looking information and identify material risk factors that could cause actual results to differ materially from the forward-looking information; and, - state the material factors or assumptions used to develop forward-looking information. - requirements to update previously disclosed forward-looking information when events and circumstances occur that are reasonably likely to cause actual results to differ materially; - guidance on general disclosure including: - the types of events or information that may be material; - avoiding exaggerated reports and potentially misleading promotional commentary; - establishing appropriate board and senior officer oversight over oral, written, and electronic disclosures; and, - issuers not participating in, hosting, or linking to chat rooms or bulletin boards; reinforcing the need to also comply with exchange disclosure policies. - guidance reminding issuers to have rigorous social media disclosure controls with the expectation that issuers ensure that all disclosures regardless of venue are balanced and not misleading, including by/through: - not making misleading statements; - not excluding facts needed to avoid misleading readers; - announcing material changes in a factual and balanced way; - disclosing unfavorable news as promptly and completely as favorable news; - avoiding exaggerated reports or potentially misleading promotional commentary; - appropriately disclosing and using forward-looking information; - not cherry-picking analysts’ reports; and, - prominently disclosing when reports and articles are paid for by the issuer. CSA staff have warned that promotional activities that they deem problematic may result in an enforcement action against any offending issuers or other regulatory responses. These can include requiring the issuers to: - issue a clarifying news release; - retract or remove overly promotional language from their disclosure record including their website and/or social media; and, - re-file continuous disclosure documents. CSA staff advise that they will continue to monitor the situation and intervene when and where necessary. CSA Staff Notice 51-356[ is available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20181129_51-356_problematic-promotional-activities-issuers.htm) from the website of the participating jurisdictions. 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. **Categories:** News & Updates **Tags:** BAX Securities Law, CSA Staff Notice 51-356, disclosure, promotion --- ### [BAX Securities Law’s Barbara Hendrickson Interviewed for Legal Entrepreneurs Podcast](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-interviewed-for-legal-entrepreneurs-podcast/) **Published:** February 19, 2019 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson, CEO and Founder of BAX Securities Law, was recently interviewed by Antonio DiMinno, host of the Legal Entrepreneurs Podcast. Barbara speaks about her background in the public sector, working for the Ontario Securities Commission (OSC), and in the private sector, and her experiences... **Content:** Barbara Hendrickson, CEO and Founder of BAX Securities Law, was recently interviewed by Antonio DiMinno, host of the Legal Entrepreneurs Podcast. Barbara speaks about her background in the public sector, working for the Ontario Securities Commission (OSC), and in the private sector, and her experiences in establishing and managing BAX Securities Law. She also discusses the state of the industry and challenges and opportunities facing young lawyers. The link to the Legal Entrepreneurs Podcast can be found [here](https://www.buzzsprout.com/195650/961286-episode-7-talking-business-with-barbara-hendrickson). 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, Legal Entrepreneurs Podcast --- ### [BAX Securities Law’s Barbara Hendrickson Announces Candidacy in the Law Society of Ontario 2019 Bencher Election](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-announces-candidacy-in-the-law-society-of-ontario-2019-bencher-election/) **Published:** February 19, 2019 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson, of BAX Securities Law has announced her candidacy in the Law Society of Ontario’s (LSO) 2019 Bencher Election. The Benchers, who sit on the LSO’s Convocation, play a vital role in determining policy and guidance regarding Ontario’s lawyers and paralegals. Benchers also sit... **Content:** Barbara Hendrickson, of BAX Securities Law has announced her candidacy in the Law Society of Ontario’s (LSO) 2019 Bencher Election. The Benchers, who sit on the LSO’s Convocation, play a vital role in determining policy and guidance regarding Ontario’s lawyers and paralegals. Benchers also sit on committees to adjudicate lawyer and paralegal conduct, as well as matters of licencing and competency. Ms. Hendrickson’s platform includes: taking action against systemic and individual discrimination within the legal profession; improving access to Legal Aid for the public; and, improving support for small law firms and sole practitioners. “As a profession,” she notes, “we face numerous challenges, some historical, but many having emerged more recently. Our Law Society’s role in meeting these challenges is to govern in a way that both meets its public interest mandate and ensures that we have a viable profession going forward.” For more information, call Barbara at BAX Securities Law (416) 601-1004 or check out her website at [www.lawfirmbarbara.wpengine.com](https://lawfirmbarbara.wpengine.com) **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, Bencher Elections, Law Society of Ontario, Legal Profession --- ### [BCSC Publishes Variation Order for BC Instrument 21-502, Exemption from Certain Filing Requirements for Out-of-Province Alternative Trading Systems](https://baxsecuritieslaw.com/bcsc-publishes-variation-order-for-bc-instrument-21-502-exemption-from-certain-filing-requirements-for-out-of-province-alternative-trading-systems/) **Published:** February 23, 2019 **Author:** Barbara Hendrickson **Excerpt:** On February 15, 2019, the British Columbia Securities Commission (BCSC) published a variation order (the Variation Order) for BC Instrument 21-502, Exemption from Certain Filing Requirements for Out-of-Province Alternative Trading Systems (BCI 21-502), removing the exemption for out-of-province alternative trading systems (ATS) from reporting change... **Content:** On February 15, 2019, the British Columbia Securities Commission (BCSC) published a variation order (the Variation Order) for BC Instrument 21-502, *Exemption from Certain Filing Requirements for Out-of-Province Alternative Trading Systems* (BCI 21-502), removing the exemption for out-of-province alternative trading systems (ATS) from reporting change filings under National Instrument 21-101 *Marketplace Operation* (NI 21-101). In 2004, the BCSC published BCI 21-502 which originally exempted out-of-province ATS from reporting change filings and quarterly activity filings as required by NI 21-101. However, with changes to the securities markets, the BCSC has determined that it now required out-of-province ATS to report change filings. With the subsequent Variation Order, the BCSC has now revised BCI 21-502 to only provide relief for out-of-province ATS from quarterly activity filings under NI 21-101. The Variation Order and the revised BCI 21-502 [is available for download](https://www.bcsc.bc.ca/21-502_%5bBCI%5d_02192019/) 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. **Categories:** News & Updates **Tags:** Alternative Trading System, BAX Securities Law, BCI 21-502, BCSC, NI 21-101, Variation Order --- ### [CSA Staff Notice 45-324 Update on the Start-up Crowdfunding Registration and Prospectus Exemptions](https://baxsecuritieslaw.com/csa-staff-notice-45-324-update-on-the-start-up-crowdfunding-registration-and-prospectus-exemptions/) **Published:** February 24, 2019 **Author:** Barbara Hendrickson **Excerpt:** On February 21, 2019, the Canadian Securities Administrators (CSA) published CSA Staff Notice 45-324 Update on the Start-up Crowdfunding Registration and Prospectus Exemptions (CSA Staff Notice 45-324), providing an update on the progress of a proposed national instrument (the proposed National Instrument) that will replace... **Content:** On February 21, 2019, the Canadian Securities Administrators (CSA) published *CSA Staff Notice 45-324 Update on the Start-up Crowdfunding Registration and Prospectus Exemptions* (CSA Staff Notice 45-324), providing an update on the progress of a proposed national instrument (the proposed National Instrument) that will replace the start-up crowdfunding exemption orders. In May 2015, the securities regulatory authorities of British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia (the participating jurisdictions), adopted substantially harmonized registration and prospectus exemptions (together, the start-up crowdfunding exemptions) that allow start-ups and early-stage businesses to raise capital in these jurisdictions. The participating jurisdictions implemented the start-up crowdfunding exemptions by way of local blanket orders and were occasionally amended (the start-up crowdfunding exemption orders). The CSA is in the process of developing a proposed National Instrument with the same key features the start-up crowdfunding exemption orders, with targeted amendments to improve harmonization and the effectiveness of crowdfunding as a capital raising tool for start-ups and early stage businesses. Subject to obtaining the necessary approvals, CSA staff will publish the proposed National Instrument for comment. While the start-up crowdfunding exemption orders expire on May 13, 2020, CSA staff expect that proposed National Instrument will not be implemented by this date. Until the proposed National Instrument is adopted, staff of the participating jurisdictions anticipate that they will amend the start-up crowdfunding exemption orders so that they will remain available for issuers and funding portals. CSA Staff Notice 45-324 [ is available for download](http://www.osc.gov.on.ca/documents/en/Securities-Category4/csa_45-324_prospectus-exemptions.pdf) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates **Tags:** BAX Securities Law, Crowdfunding, CSA Staff Notice 45-324, Proposed National Instrument, Prospectus Exemptions, Start-up crowdfunding exemption orders --- ### [Ontario Securities Commission Publishes OSC Staff Notice 45-716, Exempt Market Report, 2018](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-osc-staff-notice-45-716-exempt-market-report-2018/) **Published:** February 28, 2019 **Author:** Barbara Hendrickson **Excerpt:** On February 27, 2019, the Ontario Securities Commission released OSC Staff Notice 45-716, Exempt Market Report, 2018 (Staff Notice 45-716, The Exempt Market Report), which provides an overview on the state on the Ontario exempt markets in 2017. The findings highlighted in the Exempt Market... **Content:** On February 27, 2019, the Ontario Securities Commission released *OSC Staff Notice 45-716, Exempt Market Report, 2018* (Staff Notice 45-716, The Exempt Market Report), which provides an overview on the state on the Ontario exempt markets in 2017. The findings highlighted in the Exempt Market Report will help OSC staff as they continue to monitor the exempt market from an operational compliance perspective and to understand its role in capital formation for future policymaking. Key take-aways from the Exempt Market Report include: - Capital raised from institutional investors accounts for approximately $89.4 billion (or 98%) of the total capital invested in Ontario’s exempt market. - Individual investors contributed $2.2 billion (2%) of the total capital invested in the exempt market in Ontario and represented a large proportion (77%) of the approximately 28,500 exempt market investors. - Approximately 39% of the total capital invested by individual investors and 10% of the total capital invested by institutional investors went toward real estate or mortgage investments. - Approximately 37% or 700 of Canadian issuers in the province’s exempt market were small issuers, raising $194 million, which accounted for less than 1% of the total capital raised in 2017. Significantly, 47% of small issuers were junior mining companies with 96% in the exploration stage. Most of these junior mining companies were listed on a Canadian exchange and relied mainly upon the accredited investor exemption to raise capital. - Other Canadian issuers that raised capital in Ontario’s exempt market were also largely based in sectors such as manufacturing, technology, and life sciences. - In 2017 while the total capital raised under the offering memorandum and family, friends, and business associates exemptions rose to $327 million, representing use by 600 Canadian issuers in the province’s exempt market, most issuers relied on other exemptions, chiefly the accredited investor exemption, under which a total of $1.5 billion was raised. - The offering memorandum exemption was largely used by real estate and mortgage investment entities. - In 2017 there was no reported use of the crowdfunding prospectus exemption. However, the regulator does note that there have been several exempt market dealers and other registered entities that have facilitated a crowdfunding-like model to raise capital predominantly from accredited investors. OSC Staff Notice 45-716, Exempt Market Report, 2018 [ is available for download](http://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20181129_45-716_exempt-market-report.htm) from the website of the Ontario Securities Commission. 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. **Categories:** News & Updates **Tags:** accredited investor, BAX Securities Law, Exempt Market, Offering Memorandum Exemption, OSC, OSC Staff Notice 45-716 Exempt Market Report 2018, Prospectus Exemption --- ### [Ontario Securities Commission Refuses to Issue Receipt for The Bitcoin Fund’s Prospectus](https://baxsecuritieslaw.com/ontario-securities-commission-refuses-to-issue-receipt-for-the-bitcoin-funds-prospectus/) **Published:** March 4, 2019 **Author:** Barbara Hendrickson **Excerpt:** On February 15, 2019, the Ontario Securities Commission (OSC) declined to approve the prospectus (the prospectus) for The Bitcoin Fund (the Fund), which is managed by 3iQ Corp (the Manager). In his 17-page decision, the OSC’s Raymond Chan, Acting Director of Investment Funds and Structured... **Content:** On February 15, 2019, the Ontario Securities Commission (OSC) declined to approve the prospectus (the prospectus) for The Bitcoin Fund (the Fund), which is managed by 3iQ Corp (the Manager). In his 17-page decision, the OSC’s Raymond Chan, Acting Director of Investment Funds and Structured Products, cited subsections 61(1) and 61(2)(a)(i) of the Securities Act, (Ontario) (the Act), stating that granting permission to issue the prospectus “would not be in the public interest to do so,” and “the prospectus does not comply in a substantial respect with a requirement of the Act or the regulations.” The Manager announced the Fund in October, 2018, filing a non-offering prospectus with the intention of creating what it termed as the “first regulated Bitcoin fund in the world.” It was structured as a non-redeemable investment fund (NRIF) established under the laws of the Province of Ontario. The Fund’s investment objectives for its investors were twofold: to provide to exposure to bitcoin and the daily price movements of bitcoin; and, second, to provide the opportunity for long-term capital appreciation. In making the public interest case, the OSC’s Chan wrote, “In my view, because of the lack of established regulation for the bitcoin market at this time, an investment in the Fund raises a number of investor protection issues, notably concerning the valuation, safeguarding and liquidity of bitcoin.” In ruling that the Fund’s prospectus was noncompliant with the Act, Chan noted that bitcoin was an illiquid asset and as such, did not comply with NI 81-102, *Investment Funds* and its restriction against holding illiquid assets. Under NI 81-102, an illiquid asset is defined “as a portfolio asset that cannot be readily disposed of through market facilities on which public quotations in common use are widely available at an amount that at least approximates the amount at which the portfolio asset is valued in calculating the net asset value per security of the mutual fund.” The complete written verdict [ is available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_ord_20190221_321_3iq.htm) from the website of the Ontario Securities Commission. 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. **Categories:** News & Updates **Tags:** 3iQ Corp, BAX Securities Law, bitcoin, Cryptocurrency, Fintech, NI 81-102, OSC, prospectus, The Bitcoin Fund, the Securities Act (Ontario) --- ### [BAX Securities Law’s Barbara Hendrickson Quoted in Law Times Article Profiling Solo Legal Practitioners Running in Law Society of Ontario’s Bencher Elections](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-quoted-in-law-times-article-profiling-solo-legal-practitioners-running-in-law-society-of-ontarios-bencher-elections/) **Published:** March 13, 2019 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hedrickson, of BAX Securities Law, was prominently quoted a recent article in the Law Times. The article, Solo lawyers, small firms strive for seats at Convocation, by staff writer Anita Balakrishnan, profiled solo legal practitioners and lawyers practicing in small firms who are running... **Content:** Barbara Hedrickson, of BAX Securities Law, was prominently quoted a recent article in the *Law Times*. The article, *Solo lawyers, small firms strive for seats at Convocation,* by staff writer Anita Balakrishnan, profiled solo legal practitioners and lawyers practicing in small firms who are running in the Bencher elections for the Law Society of Ontario (LSO). The Benchers, who sit on the LSO’s Convocation, help set policy and guidance regarding Ontario’s lawyers and paralegals. Benchers also sit on committees to adjudicate lawyer and paralegal conduct, as well as issues regarding licencing and competency. “I think there has to be a greater recognition of how the existing rules differentially impact small firms and large firms,” Ms. Hendrickson was quoted as saying. In the article, she noted how her experience of moving from large firm to a solo firm demonstrated to her a difference in how rules were applied. She cited the example of referral fees, which, she said, which if involving smaller firms tend to receive more regulatory scrutiny than if involving a larger firm. The complete *Law Times* article can be found [here.](https://www.lawtimesnews.com/author/anita-balakrishnan/solo-lawyers-small-firms-strive-for-seats-at-convocation-16935/) 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, Bencher Elections, Convocation, Law Society of Ontario, Law Times, Legal Profession --- ### [Ontario Securities Commission Issues Cease Trade Order for USI-Tech Ltd.](https://baxsecuritieslaw.com/ontario-securities-commission-issues-cease-trade-order-for-usi-tech-ltd/) **Published:** March 15, 2019 **Author:** Barbara Hendrickson **Excerpt:** On February 22, 2019, the Ontario Securities Commission (OSC) issued an interjurisdictional order, permanently forbidding USI-Tech Management Limited (USI -Tech) from trading in or acquiring securities, and from trading in derivatives in the province of Ontario (the permanent order). The permanent order was issued after... **Content:** On February 22, 2019, the Ontario Securities Commission (OSC) issued an interjurisdictional order, permanently forbidding USI-Tech Management Limited (USI -Tech) from trading in or acquiring securities, and from trading in derivatives in the province of Ontario (the permanent order). The permanent order was issued after an earlier order was issued by Autorite des marches financiers (AMF) that found USI-Tech guilty of the illegal distribution of securities and forbade USI-Tech from trading in any form of securities. The five-page permanent order, based on s. 127(1) and s. 127(10) of the Ontario Securities Act (The Act), which allows for the prohibition of conduct that would be detrimental to the markets and the public interest, and the issuing of the inter-jurisdictional enforcement of orders imposed following breaches of securities law. The permanent order follows a series of temporary orders by the OSC. CSA staff found that USI-Tech, a Dubai-based online cryptocurrency and forex trading platform, is not a reporting issuer in Ontario and has never filed a prospectus in Ontario, nor was it registered as a broker in Quebec with the AMF. It’s purported offering was a “Bitcoin package,” which offered investors a return of 1% a day; and a “token,” that offered investors in the opinion of the OSC “astronomical” returns, based on the success of a hypothetical new cryptoasset, the Tech Coin, that USI-Tech intended to create and market. The Ontario and Quebec verdicts are only the most recent enforcement decisions against USI-Tech by regulators in jurisdictions in Canada, the United States, and elsewhere. The complete written verdict [ is available for download](https://www.osc.gov.on.ca/en/Proceedings_rad_20190222_usi-tech.htm) from the website of the Ontario Securities Commission. 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. **Categories:** News & Updates **Tags:** Administrative des marches financiers, BAX Securities Law, Cryptocurrency, Fintech, OSC, techcoin, the Securities Act (Ontario), USI-Tech Ltd. --- ### [CSA and IIROC Publish Consultation Paper and Request for Comment on Proposed Regulatory Framework for Cryptoasset Trading Platforms](https://baxsecuritieslaw.com/csa-and-iiroc-publish-consultation-paper-and-request-for-comment-on-proposed-regulatory-framework-for-cryptoasset-trading-platforms/) **Published:** March 20, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) have published a joint consultation paper and a request for comment, Consultation Paper 21-402 Proposed Framework for Crypto-Asset Trading Platforms (The Consultation Paper), for a sixty-day comment period ending May 15,... **Content:** The Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) have published a joint consultation paper and a request for comment, Consultation Paper 21-402 *Proposed Framework for Crypto-Asset Trading Platforms* (The Consultation Paper), for a sixty-day comment period ending May 15, 2019. The CSA and IIROC (the regulators) are jointly seeking input from the fintech community regarding a proposed framework for cryptoasset trading platforms. The regulators note that distributed ledger technology (DLT) and cryptoassets, such as bitcoin, while relatively new, are transforming the financial landscape. Although these technologies may have benefits going into the future, they also point out that a series of major incidents regarding the loss and theft of cryptoassets has raised the concern of regulatory bodies around the world. To that end, the regulators have published a 22-page Consultation Paper that seeks input on a number of areas and will assist them in determining an appropriate regulatory framework for cryptoasset platforms. These considerations include: the addressing of custody and the verification of assets; price determination; market surveillance; systems and business continuity planning; conflicts of interest; cryptoasset insurance; and, clearing and settlement. Depending on how they operate and the cryptoassets they trade in, the regulators note that cryptoasset platforms may be subject to securities and/or derivatives regulation. The form and structure of these platforms may include features that can pose risks for Canadian investors and the capital markets that may be not fully accounted for by the existing regulatory framework. The regulators are considering what they have termed “a tailored regulatory framework” to address the risks and features posed by cryptoasset platforms. The staff of CSA and IIROC advise that they will continue to coordinate with regulators in other jurisdictions regarding their approaches to cryptoasset platforms and will welcome their input on a variety of regulatory approaches that exist in this area. The Consultation Paper [ is available for download](https://www.bcsc.bc.ca/21-402_%5bJoint_Canadian_Securities_Administrators_Investment_Industry_Regulatory_Organization_of_Canada_Consultation_Paper%5d_03142019/) from the website of the participating jurisdictions and of IIROC. 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. **Categories:** News & Updates **Tags:** BAX Securities Law, Consultation Paper 21-402, cryptoasset platforms, CSA, distributed ledger technology, Fintech, IIROC --- ### [CSA Publishes Annex B, Amendments to National Instrument 31-303, Registration Requirements and Ongoing Registrant Obligations](https://baxsecuritieslaw.com/csa-publishes-annex-b-amendments-to-national-instrument-31-303-registration-requirements-and-ongoing-registrant-obligations/) **Published:** March 21, 2019 **Author:** Barbara Hendrickson **Excerpt:** On March 14, 2019, the Canadian Securities Administrators (CSA) published Annex B, Amendments to National Instrument 31-103, Registration Requirements, Exemptions and Ongoing Registrant Obligations (The Amendments). Together, the Amendments replace subsections 14.6.1(1) and (2) of National Instrument 31-303, Registration Requirements and Ongoing Registrant Obligations (NI-303):... **Content:** On March 14, 2019, the Canadian Securities Administrators (CSA) published *Annex B, Amendments to* National Instrument 31-103, *Registration Requirements, Exemptions and Ongoing Registrant Obligations* (The Amendments). Together, the Amendments replace subsections 14.6.1(1) and (2) of National Instrument 31-303, *Registration Requirements and Ongoing Registrant Obligations* (NI-303): - In Subsection 146.1(1): - “cleared specified derivative”, “clearing corporation option”, “futures exchange”, “option on futures”, “specified derivative” and “standardized future” have the same definitions as in 1.1 of National Instrument 81-102 *Investment Funds* (NI 81-102*)*; and, - “regulated clearing agency” is redefined to align with the definition in subsection 1(1) of National Instrument 94-101 *Mandatory Central Counterparty Clearing of Derivatives* (NI 94-101)*.* - Subsection 146.1(2) does not apply to a registered firm dealing with cash or securities of a client or investment fund deposited with a member of a regulated clearing agency or a dealer as margin for transactions outside of Canada involving clearing corporation options, options on futures, standardized futures, or cleared specified derivatives, if: - the member or dealer is a member of a regulated clearing agency, futures exchange, or stock exchange, and, as a result in any case, is subject to a regulatory audit; - the member or dealer has a net worth, determined from its most recent audited financial statements, in excess of $50 million; and, - a reasonable person would conclude that using the member or dealer is more beneficial to the client or investment fund than using a Canadian custodian. The Amendments come into force on June 12, 2019. In Saskatchewan, if the Amendments do not come into force at this time, they will come into force on the date it is filed with the Registrar of Regulations. The Amendments[ are available for download](https://www.bcsc.bc.ca/31-103_%5bNI_Amendment_Advance_Notice%5d_03142019/) from the website of the participating jurisdictions. 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. **Categories:** News & Updates **Tags:** Amendments, BAX Securities Law, CSA, NI 31-103 --- ### [Stablecoins](https://baxsecuritieslaw.com/stablecoins/) **Published:** March 29, 2019 **Author:** Barbara Hendrickson **Excerpt:** By: Barbara Hendrickson and Ray Luckiram[1] March 19, 2019 Introduction Stablecoins have become increasingly popular over the last few years. Stablecoins differ from other cryptocurrencies and digital assets because they are ‘pegged’ to an underlying asset.  When a cryptocurrency is said to be ‘pegged,’ it... **Content:** By: Barbara Hendrickson and Ray Luckiram[\[1\]](#_ftn1) March 19, 2019 **Introduction** Stablecoins have become increasingly popular over the last few years. Stablecoins differ from other cryptocurrencies and digital assets because they are ‘pegged’ to an underlying asset. When a cryptocurrency is said to be ‘pegged,’ it means the underlying asset is purchased by the issuer and held by a third party on behalf of the investor. By pegging their value to an underlying asset, stablecoins are considered by some to be less volatile than other cryptoassets.[\[2\]](#_ftn2) According to the cryptocurrency exchange Coinbase, most stablecoins use either a fiat-collateralized, crypto-collateralized, or follow an algorithmic model. Fiat-collateralized stablecoins are backed by actual fiat currencies held in reserve by the stablecoins’ issuers, such as central banks (centralized), whereas crypto-collateralized stablecoins are backed by digital assets locked in smart contracts (decentralized). Algorithmic stablecoins, by contrast, aren’t backed by collateral. Instead, they use various mechanisms to expand or contract their circulating supply as necessary to maintain a stable value.[\[3\]](#_ftn3) **Fiat Collaterized Stablecoin** The most common form of stablecoins are those that are backed by fiat currencies such as the USD, CAD, Euro, or Swiss Franc. Generally, fiat-backed stablecoins are held at a 1:1 redemption ratio, that is $1 of stablecoin is equal to $1 of fiat currency.[\[4\]](#_ftn4) The theory is that a portion, at least, of the general risk associated with cryptoassets is mitigated in the case of fiat-based stablecoins because the fiat currency underlying the coin are held in reserves So that in the instance where the crypto asset is compromised due to technical error or fraud, the owner of the stablecoin may still exchange the cryptocurrency for the fiat currency.[\[5\]](#_ftn5) Issuers of stablecoins face certain challenges. Developers must fundraise to finance the creation of the digital asset. They must also find trusted custodians to hold large amounts of fiat currency.[\[6\]](#_ftn6) As a consequence, the ability of the larger stablecoin issuers to hold reserves equal to the amount of circulating coins has previously been called into question.[\[7\]](#_ftn7) Most fiat currency-backed stablecoins are created in roughly the same way: purchasers deposit dollars with a stablecoin issuer, and in exchange, the issuer mints and returns an equivalent amount of the stablecoin. The process also works in reverse: stablecoin-holders can send a stablecoin back to its issuer in exchange for an equivalent amount of dollars.[\[8\]](#_ftn8) Currently, the world’s dominant fiat-backed stablecoin is Tether, which issues Tether Coins. Each Tether Coin is said to be 100% backed by reserves, which include traditional fiat currency and cash equivalents and, from time to time, may include other assets and receivables from loans made by Tether to third parties, which may include affiliated entities. According to Tether, every Tether is 1-to-1 pegged to the dollar, so 1 USD₮ is valued at 1 USD. Tether is registered as a Money Services Business with the Financial Crimes Enforcement Network of the U.S. Department of the Treasury. [\[9\]](#_ftn9) **Commodity Collateralized Stablecoin** Commodity-backed stablecoins are linked to an underlying precious or industrial metal which is traded on a commodity exchange. The commodity-backed stablecoin is backed by a physical asset. Another important element of commodity-backed stablecoins is a mandated baseline. As a rule, the minimum value of the coin will be based on the specific value of the underlying commodities. The commodity itself normally trades on an organized commodity market.[\[10\]](#_ftn10) The stablecoin normally has a fixed redemption ratio of coin to weight. For example, one coin would be equal to one gram of gold.[\[11\]](#_ftn11) Again, the issuer is required to hold the commodity in reserve on behalf of the investor, often done through a third-party custodian.[\[12\]](#_ftn12) One of the most popular commodity-backed stablecoins is the Digix Gold Token, which is redeemable at a ratio of 1 token to 1 gram of gold. According to Digix, which is based in Singapore, its digital token is backed by 99.99% gold cast bars.[\[13\]](#_ftn13) An example of a Canadian commodity-backed stablecoin is one issued by Canamex Gold Corp. (“Canamex”) a CSE-listed company. On May 9, 2018 Canamex announced a non-brokered private placement to accredited investors, of GOLDUSA Ethereum ERC20 Crypto Tokens via a Security Token Offering (“STO”). Each GOLDUSA token purchased at $US 4.00 per token represents 1/200 oz. gold. On September 28, 2018 Canamex announced the launch of the Silver STO. Each SILVERUSA is an interest in ½ oz. silver at an initial token price of $US 5.00 per token. On October 29, 2018, Canamex announced that it has executed a MOU with MDXH, a public company incorporated in Malta. Canamex is now exploring the possibility of listing and admitting to trade these GOLDUSA Tokens and SILVERUSA Tokens on the MDX. MDXH intends to establish and operate a Multilateral Trading Facility, the Malta Digital Exchange (“MDX”), a secondary market exchange platform which would allow the trading of tokens. According to the press release, MDX will be a multi-asset digital exchange, which focuses on virtual financial assets and security tokens. **Crypto Collaterized Stablecoins** Crypto collaterized stablecoins, which are backed by crypto assets and are decentralized in nature, rely on trustless issuance, which is also referred to as on-chain issuance. This type of stablecoin maintains its 1:1 peg against assets via overcollateralization, incentives, and other methods. Crypto collateralized stablecoins provide the opportunity to use crypto assets as debt collateral. These stablecoins attempt to counteract price volatility by providing that each coin is fully backed with this reserve. Collateral is held in a smart contract and accessible only by clearing the stablecoin debt. Alternatively, the smart contract can be closed and the collateral sold by the stablecoin system if excess collateral falls below a certain predetermined level. [\[14\]](#_ftn14) The DAI Stablecoin, by MakerDAO, is an example of a crypto-collateralized stablecoin. According to the Dai website, Dai is a decentralized, asset-backed currency whose value is stable relative to the USD. Price is maintained through a system of smart contracts, designed to respond to varying market dynamics. Each Dai is fully backed by an asset held in the secure MakerDAO smart contract platform. Anyone can lock their tokens up as collateral and issue Dai against them. In much the same way, any user can create Dai by opening a Collateralized Debt Position (“CDP”) on the MakerDAO platform. A CDP is a smart contract which gives users Dai in exchange for locking up valuable collateral. The assets are held in escrow until the borrowed Dai is returned by the user. Put another way, Dai is created when users lock up collateral and Dai is removed from circulation when users free up their collateralized assets. Third-party network participants, known as “keepers” help maintain the price of Dai. Keepers are generally automated programs that take advantage of arbitrage opportunities to keep Dai near its peg. They also participate in CDP auctions ensuring the orderly wind-down of liquidated contracts.[\[15\]](#_ftn15) **Algorithmic Model** Algorithmic stablecoins, also referred to as “Seigniorage Shares” and “Future Growth-Backed stablecoins,” are algorithmically-backed with expansion and reduction of coin supply mathematically determined. There is no collateral backing issuance. In the case of algorithmic stablecoins, increased demand causes the system to issue new coins, thus increasing supply and lowering price back to the peg. Seigniorage is the revenue earned from the issue of money. Historically, this revenue accrued to the “seigneur” or ruler. In Canada today, seigniorage can be calculated as the difference between the interest the Bank of Canada earns on a portfolio of Government of Canada securities—in which it invests the total value of all bank notes in circulation—and the cost of issuing, distributing, and replacing those notes.[\[16\]](#_ftn16) Anytime the price of the stablecoin is less than USD$1, the system starts offering “shares.” In order to buy the shares, though, stablecoins are needed. Essentially, speculators are offered a small portion of future growth in the stablecoin’s market cap in exchange for providing the capital to peg the fiat currency. This is why non-collateralized stablecoins are often referred to as “Seigniorage Shares”, as seignorage is the profit made by a government through issuing fiat currency, especially the difference between the face value of coins and production costs.[\[17\]](#_ftn17) Basis is an example of an algorithmic stablecoin. In April 2018, Basis made headlines when its promoters raised $133 million from several prominent venture firms. But, only eight months later, Basis shut down unexpectedly and returned its remaining capital to investors. The reason for the shuttering, according to Basis CEO Nader Al-Naji: “We met with the SEC to clarify a lot of our thinking \[and\] got the impression that we would not be able to avoid securities classification.” **Looking Forward** Stablecoins have not been the subject of extensive discussion by securities regulators in Canada and nor the U.S. to date. However, when Valerie A. Szczepanik, Associate Director of the SEC’s Division of Corporation Finance and the SEC’s Senior Advisor for Digital Assets and Innovation, was recently asked her view on stablecoins, she made the following cautionary remark in reference to two types of stablecoins: those that maintains a fixed price and those whose value fluctuates in order to help the first token’s price stay fixed (algorithmic stablecoins): “You might be getting into the land of security.”[\[18\]](#_ftn18) Securities regulators in Canada might say the same thing. For more information, please call Barbara Hendrickson at BAX Securities Law (416) 601 -1004 or Ray Luckiram (416) 601-0591. 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. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ [\[1\]](#_ftnref1) We are grateful to Addison Cameron-Huff for his review of this piece. [\[2\]](#_ftnref2) accessed on March 19, 2019. [\[3\]](#_ftnref3) accessed on March 19, 2019. [\[4\]](#_ftnref4) https://masterthecrypto.com/guide-to-stablecoin-types-of-stablecoins/ accessed on March 19, 2019. [\[5\]](#_ftnref5) accessed on March 19, 2019. [\[6\]](#_ftnref6) accessed on March 19, 2019. [\[7\]](#_ftnref7) https://medium.com/datadriveninvestor/the-power-of-code-stablecoins-part-4-5c18cc5b7f7 [\[8\]](#_ftnref8) ; accessed on March 19, 2019 [\[9\]](#_ftnref9) ; accessed on March 19, 2019. [\[10\]](#_ftnref10) ; accessed on March 19, 2019. [\[11\]](#_ftnref11) N. https://loopring.org/resources/pwc-loopring-stablecoin-paper.pdf [\[12\]](#_ftnref12) ; accessed on March 19, 2019. [\[13\]](#_ftnref13) https://digix.global/dgx/, accessed on March 19, 2019; accessed on March 19, 2019. [\[14\]](#_ftnref14) ; accessed on March 19, 2019. [\[15\]](#_ftnref15) ; accessed on March 19, 2019. [\[16\]](#_ftnref16) ; accessed on March 19, 2019. [\[17\]](#_ftnref17), ; accessed on March 19, 2019. [\[18\]](#_ftnref18)https://www.coindesk.com/secs-valerie-szczepanik-at-sxsw-crypto-spring-is-going-to-come; accessed on March 19, 2019. ; **Categories:** News & Updates **Tags:** Basis, Cryptocurrency, Dai, Digix, Fintech, MakerDAO, stablecoins, Tether --- ### [SEC’s Latest Guidance on Digital Assets Reinforces Importance of Howey](https://baxsecuritieslaw.com/secs-latest-guidance-on-digital-assets-reinforces-importance-of-howey/) **Published:** April 15, 2019 **Author:** Barbara Hendrickson **Excerpt:** The most recent guidance published by the Securities and Exchange Commission (SEC) goes even further to reinforce the importance of the concept of the “investment contract”  and the Howey Test when determining if a digital asset is a security. The SEC relies heavily upon the... **Content:** The most recent guidance published by the Securities and Exchange Commission (SEC) goes even further to reinforce the importance of the concept of the “investment contract” and the *Howey Test* when determining if a digital asset is a security. The SEC relies heavily upon the *Howey Test* to determine if, in fact, an investment contract exists in digital assets such as an Initial Coin Offering (ICO). At the heart of *Howey* is the twofold question whether in the offering there has been an investment of money in a common enterprise and whether there is a reasonable expectation of profit from the efforts of others. If an offering is found to have met these criteria, then an investment contract is deemed to exist. In its guidance, the SEC broke down its thoughts on its application of *Howey* to digital assets: - *The Investment of Money*: this criterion is typically satisfied in an offer and sale of a digital asset because the asset is purchased or otherwise acquired in exchange for value, whether in the form of fiat currency, another digital asset, or other types of consideration; - *A Common Enterprise:* the SEC notes that courts have found the existence of a common enterprise a “distinct element of an investment contract.” Most U.S. federal courts have defined this as a situation where individuals are found to have pooled their money with the goal of making an investment; and, - *A Reasonable Expectation of Profit from the Efforts of Others*: The SEC noted that to meet this requirement, a purchaser may expect to realize a return through participating in distributions or through other methods of realizing appreciation on the asset, such as selling at a gain in a secondary market through the efforts of a third party. The SEC defines the third party – whether they be a sponsor, promoter, or group of third parties – as Active Participants (AP). It’s important to note that price appreciation resulting solely from external market forces (such as inflation or economic trends) impacting the supply and demand for an underlying asset is not usually considered “profit” under *Howey.* - In asking whether the purchaser is relying upon the others, questions raised by the SEC include: does the purchaser reasonably expect to rely upon the AP’s efforts? Are these efforts what the regulator terms “undeniably significant?” Does the AP further develop the digital asset as to enhance its value? Does the AP have a lead, central or managerial role? Does the AP have the ability through capital appreciation of the digital asset? - In determining whether a reasonable expectation of profit exists, the SEC asks a number of questions, including: does the digital asset gives the holder rights to share in the enterprise’s income or profits or to realize a gain from capital appreciation of the digital asset? Is the asset tradable on a secondary market or platform? Is there a reasonable expectation that purchasers would expect the AP’s efforts to result in capital appreciation? Is the asset being offered broadly to purchasers rather than those who may have a need for it based on a strict network application? In this guidance, besides *Howey*, the SEC notes that there are other considerations present when determining whether there is an investment contract present in a digital asset. Federal courts in the United States, will look to economic realities of the transaction when determining if a reasonable expectation of a profit exists. The regulator also notes that certain characteristics of a digital asset, such as the operational status of the distributed ledger network and/or digital asset, and whether the digital asset’s creation and structure is designed for strictly for its user needs rather than broader capital appreciation, can mean it is less likely that the *Howey* criteria will be met. The *Framework for “Investment Contract” Analysis of Digital Assets* can be found [on the website of the Securities and Exchange Commission.](https://www.sec.gov/corpfin/framework-investment-contract-analysis-digital-assets) 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, Digital asset, Fintech, Howey, ICO, SEC --- ### [TSX Staff Notice 2019-0002: The TSX Sandbox](https://baxsecuritieslaw.com/tsx-staff-notice-2019-0002-the-tsx-sandbox/) **Published:** April 17, 2019 **Author:** Barbara Hendrickson **Excerpt:** On April 12 2019,  the Toronto Stock Exchange (TSX) published its latest guidance on the TSX Sandbox, TSX Staff Notice 2019-0002 (the Staff Notice). The Toronto Stock Exchange created the TSX Sandbox to facilitate listing applications that ordinarily would not satisfy the requirements and guidelines... **Content:** On April 12 2019, the Toronto Stock Exchange (TSX) published its latest guidance on the TSX Sandbox, *TSX Staff Notice 2019-0002* (the Staff Notice). The Toronto Stock Exchange created the TSX Sandbox to facilitate listing applications that ordinarily would not satisfy the requirements and guidelines of TSX, but due to facts or situations unique to a particular issuer may otherwise warrant a listing on TSX or an exemption from certain requirements in the TSX Company Manual (the Manual). TSX staff advise that applications to the Sandbox should by no means be considered as establishing precedents for future applications to the Sandbox. All applications will be reviewed by TSX staff on a case-by-case basis. Additionally, staff will also continue to deal with those standard applications that might require regulatory relief in the ordinary course of business. The TSX Sandbox is open to applicants from all industry sectors from early-stage companies to those who are more seasoned. The Sandbox is also open to existing TSX-listed issuers who wish to pursue novel financing, including equity, debt, structured products, and other securities. The eligibility requirements, principally for new corporate or supplemental listings, include, but are not limited to the following considerations: - The experience level of the management team, and whether the board of directors and other supporters has a demonstrated track record in public markets; A significant public raise resulting in a wide distribution of the applicant’s securities. - Size of the application’s market capitalization and significant pre-tax cash flow from operations; - Incorporation in Canada or in a jurisdiction with corporate governance practices comparable to Canadian standards; - The existence of a long-form prospectus recently receipted by a member of the Canadian Securities Administrators (CSA) or a U.S. registration statement recently made effective through a Securities and Exchange Commission (SEC) filing; - Sponsorship by a TSX participating organization or commentary and support from another entity with recognizable sector-specific expertise; - Evidence of wide public support and investor interest; and, - Established corporate governance practices. Certain conditions, however, advise TSX staff, may make an application ineligible for the TSX Sandbox. These include, but are not limited to: - ongoing regulatory or historical sanctions or investigations; - emerging market issuers; - unfavorable regulatory or media information regarding the applicant, its management, or board members; and, - those applicants and listed issuers who have previously applied through TSX’s standard procedures, unless invited to apply to the Sandbox by TSX staff. Given that TSX Sandbox applications would not generally satisfy listing requirements, TSX staff note that they may apply additional conditions in order to facilitate a listing on a one-off basis. Such conditions may include, but are not limited to: - Enhanced disclosure requirements; - Impositions of a minimum public raise and/or a minimum market capitalization; and, - Enhanced sponsorship or “expertised support” in the form of a report to TSX. As the TSX Sandbox is intended to be a proving ground for policy initiatives that might ordinarily develop over a longer term, TSX staff advise that they will continue to provide further updates and guidance through additional Staff Notices as necessary. The complete TSX Staff Notice 2019-0002 can be found on the website of the [Toronto Stock Exchange](http://tmx.complinet.com/en/display/display.html?rbid=2072&element_id=1172&record_id=1525). 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, TSX, TSX Staff Notice 2019-0002 --- ### [IIROC Publishes Rules Notice and Request for Comment Regarding Proposed Alternative Forms of Discipline](https://baxsecuritieslaw.com/iiroc-publishes-rules-notice-and-request-for-comment-regarding-proposed-alternative-forms-of-discipline/) **Published:** April 30, 2019 **Author:** Barbara Hendrickson **Excerpt:** On April 25, 2019, the Investment Industry Regulatory Organization of Canada (IIROC) published Rule Notice and Request for Comment 19-0076, (the rule notice and request for comment) for a period ending July 24, 2019, regarding two proposed alternative forms of disciplinary action. The two proposed... **Content:** On April 25, 2019, the Investment Industry Regulatory Organization of Canada (IIROC) published Rule Notice and Request for Comment 19-0076, (the rule notice and request for comment) for a period ending July 24, 2019, regarding two proposed alternative forms of disciplinary action. The two proposed alternative forms of disciplinary action, the Minor Contravention Program (MCP) and the Early Resolution Offers, were proposed as amendments to IIROC’s Consolidated Enforcement, Examination, and Approval Rules (the Consolidated Rules). They were first published on February 22, 2018, in Notice 18-0045 (the February Notice). - Minor Contravention Program: According to IIROC staff, the MCP would allow IIROC to deal with contraventions that fall between a cautionary letter and a formal disciplinary proceeding. IIROC staff believe that the MCP highlights the importance of progressive discipline and ensures enforcement outcomes are proportionate to the contravention yet provide adequate deterrence. Based on stakeholder feedback from the Notice, IIROC staff made a series of amendments (the amendments), which it is now asking for comment on. - The Early Resolution Offers: In the current settlement regime, enforcement cases may only be resolved by entering into a settlement agreement subject to approval by a hearing panel. Settlement agreements are typically reached after an investigation by staff and extensive negotiations between IIROC staff and the respondent. By contrast, the proposed Early Settlement Offer would represent IIROC’s best settlement offer by granting a reduction of 30% on the sanctions that would be ordinarily imposed. IIROC staff believe that the use of Early Resolution Offers would promote the timely resolution of cases, increase the application of the Staff Policy Statement on Credit for Cooperation and encourage Dealers to implement timely compensation and remedial measures. Rule Notice and Request for Comment 19-0076 can be found on the [website of the Investment Industry Regulatory Organization of Canada](https://www.osc.gov.on.ca/documents/en/Marketplaces/iiroc_20190425_notice-rfc-minor-contravention-program.pdf). 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, IIROC, Rule Notice and Request for Comment 19-0076 --- ### [Canadian Securities Regulators Publish IIROC Oversight Review Report](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-iiroc-oversight-review-report/) **Published:** May 14, 2019 **Author:** Barbara Hendrickson **Excerpt:** On April 18, 2019, the Canadian Securities Administrators (CSA), along with seven participating jurisdictions, released its oversight review (the Review) of the Industry Regulatory Organization of Canada (IIROC). The risk-based review of IIROC’s functional areas and key processes was carried out under the mandates of... **Content:** On April 18, 2019, the Canadian Securities Administrators (CSA), along with seven participating jurisdictions, released its oversight review (the Review) of the Industry Regulatory Organization of Canada (IIROC). The risk-based review of IIROC’s functional areas and key processes was carried out under the mandates of the respective jurisdictions. In conducting the Review, staff identified three low-priority findings: - An examination module used in the Trading Conduct Compliance department that was not updated on a timely basis to assess new amendments to the Uniform Market Integrity Rule (UMIR) 6.2 *Designations and Identifiers;* - the maintenance of the edit-access functionality within the rule interpretation database not being restricted to the Policy department and other applicable IIROC senior staff; and, - The Registration department’s inadequate monitoring of an external service provider’s re-accreditation of licensing and continuing education courses. CSA staff carried out the Review in conjunction with the staff of seven of the participating provincial jurisdictions that recognize IIROC (the Autorité des marches financiers; the British Columbia Securities Commission; the Financial and Consumer Affairs Authority of Saskatchewan; the Financial and Consumer Services Commission of New Brunswick; the Manitoba Securities Commission; the Nova Scotia Securities Commission; and, the Ontario Securities Commission – together, the Recognizing Regulators). The Review did not identify any further concerns other than the ones noted above. The Recognizing Regulators require that IIROC resolve the findings and will continue to monitor and follow up as necessary. The staff of the Recognizing Regulators made no other comments or conclusions on IIROC operations or activities that are outside the scope of the Review. Staff have also set out certain other expectations regarding various practices and procedures carried out by IIROC across the functional areas reviewed. These expectations are identified for IIROC to take note of and use as a basis for seeking improvements going forward. The expectations are set out in the *Risk Assessment and Fieldwork* section of the report. The full *Oversight Review Report of the Investment Industry Regulatory Organization of Canada* [is available for download](https://www.osc.gov.on.ca/documents/en/Marketplaces/sro-iiroc_20180426_oversight-rev-rpt-investment.pdf) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, CSA, IIROC --- ### [Canadian Securities Administrators Take First Steps to Replacing SEDAR](https://baxsecuritieslaw.com/canadian-securities-administrators-take-first-steps-to-replacing-sedar/) **Published:** May 14, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have taken the first steps to replace the current range of electronic records filing systems used In Canada’s capital markets. The CSA is proposing to replace the System for Electronic Document Analysis and Retrieval (SEDAR), the System for Electronic Disclosure... **Content:** The Canadian Securities Administrators (CSA) have taken the first steps to replace the current range of electronic records filing systems used In Canada’s capital markets. The CSA is proposing to replace the System for Electronic Document Analysis and Retrieval (SEDAR), the System for Electronic Disclosure by Insiders (SEDI), the National Registration Database (NRD), and various local records filing systems with a new, more user-friendly integrated national information and filing system (the Renewed System). The Renewed System will be rolled out in stages. The first stage, with a planned launch date in early 2021, will replace issuer-related systems and filings: SEDAR, the National Cease Trade Order Database, the Disciplined List, and certain filings made in paper format or in local electronic filing systems. Later stages will see the replacement of SEDI, NRD, the National Registration Search, and the remaining filings in local systems. In order to prepare for the Renewed System, the CSA published on May 2, 2019 two notices for comment for a period ending July 31, 2019: - *Multilateral Instrument 13-102 System Fees for SEDAR and NRD*, which proposes a fee flat structure for the New System. This would reflect the New System’s operating cost while allowing for future enhancements and reducing the administrative burden for market participants; - *National Instrument 13-103 \[System Replacement Rule\],* discusses proposed changed filing requirements under the Renewed System. These new requirements would require filers to electronically transmit all documents to securities regulators through the new system, subject to certain exemptions. The exemptions include: - Documents delivered in connection with a hearing, compliance review or investigation, or certain documents that are filed infrequently; and, - Certain documents that would be required to be filed or delivered via the Renewed System in future phases of the project. The CSA expects to propose further changes to National Instrument 13-103 \[System Replacement Rule\] as future phases of the Renewed System are rolled out and will publish updates accordingly. Multilateral Instrument 13-102 System Fees for SEDAR and NRD, [is available for download](https://www.bcsc.bc.ca/Securities_Law/Policies/Policy1/PDF/13-102__MI_Advance_Notice__August_27__2013/) from the website of the participating jurisdictions. National Instrument 13-103 \[System Replacement Rule\], [ is available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_ni_20190502_13-103_proposed-nsrp-rule.htm) from the website of the participating jurisdictions. 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, CSA, Multilateral Instrument 13-102, National Instrument 13-103, SEDAR --- ### [What is a Simple Agreement for Future Equity or SAFE?](https://baxsecuritieslaw.com/what-is-a-simple-agreement-for-future-equity-or-safe/) **Published:** May 22, 2019 **Author:** Ray Luckiram **Excerpt:** A Simple Agreement for Future Equity (SAFE) is a financing contract used by start-ups and investors where operating capital is exchanged for the right to acquire equity at a future time or event, such as the closing of an equity financing round, an M&A transaction... **Content:** A Simple Agreement for Future Equity (SAFE) is a financing contract used by start-ups and investors where operating capital is exchanged for the right to acquire equity at a future time or event, such as the closing of an equity financing round, an M&A transaction or an IPO/ reverse takeover. A SAFE differs from a convertible loan because it is not a debt instrument and it is considered a “convertible equity.”[\[1\]](#_ftn1) Benefits of SAFEs include execution in a short period of time and relatively lower legal costs due to the simplicity of the agreement itself. Potential Investors may prefer a SAFE because in the event of a dissolution, the agreement may contain a clause which gives the investor priority over common shareholders. However, the investor will not have security rights over the assets of the company and other creditors may have priority. [\[2\]](#_ftn2) **Introduction** The Y Combinator Accelerator in Silicon Valley first introduced the SAFE in late 2013 due to the relatively high volume of early stage deals. A SAFE was simple and effective method of financing to get the initial capital of a company. According to Y Combinator: *The \[SAFE\] has what we think is a huge advantage for both founders and investors – the ability to calculate immediately and precisely how much ownership of the company has been sold. It’s critically important for founders to understand how much dilution is caused by each safe they sell, just as it is fair for investors to know how much ownership of the company they have purchased.[**\[3\]**](#_ftn3)* In early 2017, the National Angel Capital Organization (NACO) created a task force of members and stakeholders, including the Federal government, RBC and large law firms, to bring legally compliant and nationally accepted best practices of SAFEs to the Canadian market. The task forced published the *Educational Notes to the Simple Agreement for Future Equity (SAFE)* (NACO Guidelines) which highly Canadian nuances to the financing contract. The Canadian Simple Agreement for Future Equity (Canadian SAFE) is modelled after the Y Combinator SAFE. According to NACO, pros of the Canadian SAFE include: - It is a simple and fast agreement, a figurative ‘papered handshake’ - It favours the company much like a convertible loan can - It works best in a hot/active market with promising start-ups - It can assist with obtaining a tax credit in certain provinces Conversely, the negatives of the Canadian SAFE include: - It is an open-ended deal and the investor can be left ‘hanging’ - Can be used inappropriately, if the founder is not properly knowledgeable on the structure - Some formats may not work in Canada[\[4\]](#_ftn4) Important elements of both the Canadian SAFE and the Y Combinator SAFE is the inclusion of a triggering event, valuation cap and a discount. A maturity date was added to the Canadian SAFE to make it more appropriate for the Canadian market. The definition of terms and discussion of sections in the Canadian SAFE will be discussed in the next paragraph. **The Important Terms and Features of a Canadian SAFE** **Triggering Event** A SAFE is based on an anticipated event in the future as opposed to a strict date (a Canadian SAFE may still need a maturity date to be effective). Once this event occurs, the right to receive equity by the investor will convert to actual equity, often preferred shares. A common event for conversion is future equity financing, usually led by an institutional venture capital (VC) fund. However, there are other events which may trigger the conversion, such as a change of control scenario, an IPO or liquidation. If a liquidity event occurs, under the NACO Guidelines, there are two options available to the investor. The first option is to receive a cash payment equal to the purchase amount, or second, automatically receive from the corporation a number of shares equal to the purchase amount divided by the liquidity price. Both a merger or acquisition, and an IPO qualify as a liquidity event.[\[5\]](#_ftn5) **Equity Financing** In general, the purpose of investing through a SAFE is to capitalize on a future equity financing event. The conversion from a right to equity is governed by a specific formula based on the terms of the SAFE. Importantly, many SAFEs do not to include a minimum amount for future equity financing event and may convert based on the valuation of the financing event If there is an equity financing event before the maturity or termination of the SAFE, the company will automatically issue to the investor either: 1. a number of shares sold in the equity financing equal to the purchase amount divided by the price per share of the shares, if the pre-money valuation is less than or equal to the valuation cap; or, 2. a number of shares equal to the purchase amount divided by the SAFE price (valuation cap divided by total outstanding shares, less the discount), if the pre-money valuation is greater than the valuation cap.[\[6\]](#_ftn6) The first equity financing event may be in common or preferred shares. In the US, it is commonly in preferred shares. On the triggering of the conversion of the SAFE, the investor will become a shareholder and his or her name will show in the share register. **Dissolution Event** If a dissolution event of the company occurs before the SAFE matures, the company will be liable to pay the investor the purchase amount. The purchase amount should be paid before any distribution to common shareholders of the company. Under the NACO Guidelines, if the assets of the company are insufficient to permit the payment then the entire assets of the company available for distribution will be distributed with equal priority and *pro rata* among the investors. In practical reality, it is questionable if there would be any funds left to distribute to investors as they will rank behind the government, employees and trade creditors.[\[7\]](#_ftn7) **Valuation Cap** The valuation cap is an optional term which protects the investor from dilution of their shares. It will generally be the main basis of negotiation between the investor and company. The valuation cap of a SAFE sets a contractual ceiling on the pre-money valuation that will be used to calculate the price at which an investor’s SAFE converts to equity at the time of a future conversion event. The valuation cap entitles investors to convert into equity at the lower of the valuation cap or the price in the subsequent financing.[\[8\]](#_ftn8) Essentially, the valuation cap ensures the initial SAFE investor gets a better price per share than a later investor. If in a subsequent equity financing round, the company is able to raise more money than the valuation cap, the investor benefits because it receives equity based on the lower valuation cap, thus receiving more shares. If less money than the valuation cap is raised, the investor still benefits because it can select the lower amount as the basis for the equity financing calculation. **Discount Rate** The discount rate is another optional term which benefits the investor. It is an incentive for the investor for participating in a convertible equity structure. It is specifically defined amount which is a discount to the share price at which the SAFE converts. The NACO Guidelines suggest that this often ranges from 15 to 30%, however, founders should negotiation in the best interest of the company. As a general rule, the shorter the term and the less risky the investment, the lower the expected discount.[\[9\]](#_ftn9) **Maturity Date** The maturity date is an inclusion in Canadian SAFE and is not included in its US counterpart. Based on the construction of a SAFE, it could be outstanding for a relatively long period of time, as the it will expire only when the investor receives equity or cash. To improve investor protection in the Canadian market, NACO suggests a specific maturity date. **Conclusion** Thus, a SAFE has three main forms: 1. SAFE with a valuation cap, no discount 2. SAFE with discount, no valuation cap 3. SAFE with valuation cap and discount If you are interested in using SAFEs, it important to plan your financing cycle with the founders based on the business plan and growth valuation. Understanding the long-term cash needs of your business will help you execute effective SAFE which benefit both the company and the investors. For more information, please call Barbara Hendrickson (416) 601-1004 or Ray Luckiram (416) 601-0591 at BAX Securities Law. 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. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ [\[1\]](#_ftnref1) *Educational Notes to the Simple Agreement for Future Equity (SAFE),* National Angel Capital Organization (NACO), April 2017. [\[2\]](#_ftnref2) C. Levy, *Safe Financing Documents,* Y Combinator, September 2018, available at [\[3\]](#_ftnref3) NACO, *supra* note 1. [\[4\]](#_ftnref4) *Common Docs,* NACO, accessed on May 12, 2019, available at https://www.nacocanada.com/cpages/common-docs [\[5\]](#_ftnref5) NACO, *supra* note 1. [\[6\]](#_ftnref6) NACO, *supra* note 1. [\[7\]](#_ftnref7) NACO, *supra* note 1. [\[8\]](#_ftnref8) NACO, *supra* note 1. [\[9\]](#_ftnref9) NACO, *supra* note 1. **Categories:** News & Updates **Tags:** Capital raising, Private Placement, SAFE, Simple agreement for future equity, Venture capital --- ### [SEC Charges Waterloo-based Kik Interactive Inc. over Unregistered ICO](https://baxsecuritieslaw.com/sec-charges-waterloo-based-kik-interactive-inc-over-unregistered-ico/) **Published:** June 6, 2019 **Author:** Barbara Hendrickson **Excerpt:** The United States Securities and Exchange Commission (SEC) today commenced an enforcement action against Waterloo, Ontario-based Kik Interactive Inc. (Kik) for what it alleges is an illegal USD $100 million ICO Initial Coin Offering (ICO). The SEC alleges that Kik sold the tokens to U.S.... **Content:** The United States Securities and Exchange Commission (SEC) today commenced an enforcement action against Waterloo, Ontario-based Kik Interactive Inc. (Kik) for what it alleges is an illegal USD $100 million ICO Initial Coin Offering (ICO). The SEC alleges that Kik sold the tokens to U.S. investors without first registering their offering and sale as required by the U.S. Securities law. The SEC is charging Kik under Section 5 of the *Securities Act of 1933*. The SEC is seeking a permanent injunction, disgorgement plus interest, and a penalty. The regulator alleges that since the ICO involved securities transactions, Kik was required to comply with the registration requirements of the U.S. securities laws. In May 2017, Kik, the developer of the Kik Messenger app for smartphones, pivoted to the cryptocurrency space with an ICO of its Kin digital tokens. By the time of the end of the sale in the following September, it had offered and sold one trillion Kin tokens, making it one of the most widely-held cryptocurrencies in the world and had raised $100 million worldwide, with $55 million coming from U.S. investors. The SEC alleges that Kik had been motivated to do this because it “had lost money for years” on its messenger product. At the time of the ICO, the Ontario Securities Commission (OSC) took the position that the offering would likely violate Ontario securities law because the tokens were investment contracts and thus, securities. After learning of the OSC’s position, Kik barred Canadians from participating in the offering. The SEC’s complaint alleges that Kik marketed its tokens as investment opportunities, selling them at a discounted price to wealthy investors. The regulator further alleges that Kik told investors that demand would drive up the value of the token and that the company would help spark this demand by incorporating the tokens into its messenger app, creating a Kin transaction service, and rewarding other companies to adopt its token. At the time, the SEC notes that these services did not exist and there was nothing to purchase with the token. The SEC alleges that Kik reserved a further three trillion kin tokens for itself, which would immediately trade on secondary markets, and the company would profit alongside investors from the increased demand that it would foster. Finally, the regulator also charges the company told its investors they could expect profits from its efforts to create a digital ecosystem. The expectation of profits based on the efforts of others is a hallmark of a securities offering, according to the SEC. The announcement from the Securities and Exchange Commission can be [downloaded from the SEC’s website](https://www.sec.gov/news/press-release/2019-87). 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, ICO, Kik Interactive, Kin token, OSC, SEC --- ### [Ontario Government Replaces FSCO, DICO with new Financial Services Regulator](https://baxsecuritieslaw.com/ontario-government-replaces-fsco-dico-with-new-financial-services-regulator/) **Published:** June 12, 2019 **Author:** Barbara Hendrickson **Excerpt:** The government of Ontario has announced that a new independent agency, the Financial Services Regulatory Authority of Ontario (FSRA), will replace both the Financial Services Commission of Ontario (FSCO) and the Deposit Insurance Corporation of Ontario (DICO), effective June 8, 2019. The new agency will... **Content:** The government of Ontario has announced that a new independent agency, the Financial Services Regulatory Authority of Ontario (FSRA), will replace both the Financial Services Commission of Ontario (FSCO) and the Deposit Insurance Corporation of Ontario (DICO), effective June 8, 2019. The new agency will regulate Ontario’s financial services providers, excluding the securities sector, which is under the jurisdiction of the Ontario Securities Commission (OSC). FSRA’s areas of supervision include the province’s insurance sector, pension plans, loan and trust corporations, credit unions and caisses populaires, mortgage brokers and service providers who invoice auto insurers for statutory accident benefit claims. The agency proposes to eventually supervise the activities of financial planners and advisors. FSRA’s legislative mandate, under the [Financial Services Regulatory Authority of Ontario Act, 2016, S.o. 2016, chapter 37, Schedule 8](https://www.ontario.ca/laws/statute/16f37) (the Act) is to: - Regulate and generally supervise the regulated sectors; - Contribute to public confidence; - Monitor and evaluate developments and trends; - Promote public education and knowledge; - Promote transparency and disclosure of information; and, - Deter deceptive or fraudulent conduct, practices and activities. The Ontario Ministry of Finance will administer FSCO’s Dispute Resolution Services until June 30, 2020. During the transitional period, all open cases will continue; however, no new proceedings will commence. As of July 1, 2020, any remaining cases will be extinguished, with parties able to start a new proceeding under FSRA’s Licence Appeal Tribunal. The link to the Financial Services Regulatory Authority of Ontario (FSRA) website [can be found here](https://www.fsrao.ca/). 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, DICO, FISCO, FSRA --- ### [Canadian Securities Administrators Publish Fiscal Year 2018/2019 Enforcement Report](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-fiscal-year-2018-2019-enforcement-report/) **Published:** July 2, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published the Fiscal Year 2018/2019 Enforcement Report (the Report) which details the enforcement actions the regulator took during the past year.  As well, the Report highlighted cooperation between different jurisdictions and the investments in new technology that have enabled... **Content:** The Canadian Securities Administrators (CSA) have published the Fiscal Year 2018/2019 Enforcement Report (the Report) which details the enforcement actions the regulator took during the past year. As well, the Report highlighted cooperation between different jurisdictions and the investments in new technology that have enabled it to punish misconduct and preserve the integrity of the capital markets. Fiscal Year 20018/2019 saw CSA members continue to strengthen collaboration efforts with each other and securities regulators in other countries by sharing best practices and aligning on enforcement priorities. This included advancing the multijurisdictional response to emerging pump-and-dump threats as part of the Cross-Border Market Fraud Initiative and hosting global representatives at the annual Insider Trading and Market Manipulation Conference. Highlights of the Report include: - Over 200 public inquiries were received by NASAA (North American Securities Administrators Association) from Operation Cryptosweep; - 100 cease-trade and asset-freeze orders were issued; - 63 individuals were banned from participating in the capital markets; - 46 investor alerts were issued; - 12 offenders received a combined 36 years of jail time under the Criminal Code, with a further 11 individuals receiving a combined 12.7 years for quasi-criminal offenses; and, - 82 files were referred among the jurisdictions for further action. The full *Fiscal Year 2018/2019 Enforcement Report* [is available for download](http://www.csasanctions.ca/) from the website of the Canadian Securities Administrators. 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, CSA, Enforcement --- ### [CSA, IIROC Provide Update on Conflict of Interest Resulting from Soliciting Dealer Requirements](https://baxsecuritieslaw.com/csa-iiroc-provide-update-on-conflict-of-interest-resulting-from-soliciting-dealer-requirements/) **Published:** July 2, 2019 **Author:** Barbara Hendrickson **Excerpt:** In April 2018, the Canadian Securities Administrators issued (CSA) CSA Staff Notice 61-303, Soliciting Dealer Requirements and Request for Comment (the CSA Staff Notice and Request for Comment) for stakeholder consultation. After the comment period ended and after reviewing the feedback, the CSA and IIROC... **Content:** In April 2018, the Canadian Securities Administrators issued (CSA) *CSA Staff Notice 61-303, Soliciting Dealer Requirements and Request for Comment* (the CSA Staff Notice and Request for Comment) for stakeholder consultation. After the comment period ended and after reviewing the feedback, the CSA and IIROC (Investment Industry Regulatory Organization of Canada) determined that the publication of the guidance contained in *IIROC Notice 19-0092 Managing Conflicts of Interest arising from Soliciting Dealer Arrangements* (the Notice) provided the best means of addressing regulatory concerns associated with soliciting dealer arrangements. In drafting its guidance, IIROC consulted with its Dealer Members (Dealers), its advisory committees, the CSA, and considered the comments received in response to the CSA’s Staff Notice and Request for Comment. The Notice sets out IIROC’s view that in some cases, conflicts of interest arising from soliciting dealer arrangements can be managed through appropriate policies and procedures. In other cases, where conflicts are or appear to be unmanageable, they should be avoided. For example, Dealers should avoid arrangements that contemplate one-sided or success-based fees in contested director elections. *IIROC Notice, 19-0092 Managing Conflicts of Interest arising from Soliciting Dealer Arrangements* [is available for download](https://www.iiroc.ca/documents/2019/8655bc0b-d4fc-4aab-90eb-ebc5291f4bf9_en.pdf) from the website of the Investment Industry Regulatory Organization of Canada. 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, CSA, IIROC, Soliciting Dealer Requirements --- ### [OSC Reduces Regulatory Burden on Investment Fund Managers of Pooled Funds](https://baxsecuritieslaw.com/osc-reduces-regulatory-burden-on-investment-fund-managers-of-pooled-funds/) **Published:** July 15, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has lifted some of the regulatory burden for investment fund managers of pooled funds. Fund managers of pooled funds now no longer need to apply for approval to act as trustees. As registrants, the OSC deems that fund managers are... **Content:** The Ontario Securities Commission (OSC) has lifted some of the regulatory burden for investment fund managers of pooled funds. Fund managers of pooled funds now no longer need to apply for approval to act as trustees. As registrants, the OSC deems that fund managers are already capable of acting as trustees and are subject to the current securities regulatory framework for safeguarding the assets of pooled funds. The change is reflected in *Revised Approval 81-901 Mutual Fund Trusts: Approval of Trustees Under Clause 213(3)(b) of the Loan and Trust Corporations Act.* The requirement dates back to 1997 when fund managers were not subject to other forms of regulatory oversight by the OSC, including the requirement to register*.* Under the old system an investment fund manager of a pooled fund seeking to act as a trustee had to pay an application fee of $1500, file the application, have it reviewed by OSC staff and receive approval of the application. Since January 2009 OSC staff have received 134 applications, which seen have routine approval. *Revised Approval 81-901 Mutual Fund Trusts: Approval of Trustees Under Clause 213(3)(b) of the Loan and Trust Corporations Act* [is available for download](https://www.osc.gov.on.ca/documents/en/Securities-Category8/20190627_81-901_approval-of-trustees.pdf) from the website of the Ontario Securities Commission. 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, OSC, PooledFunds --- ### [Canadian and Foreign Cryptocurrency Exchanges to be Required to Register with FINTRAC](https://baxsecuritieslaw.com/canadian-and-foreign-cryptocurrency-exchanges-to-be-required-to-register-with-fintrac/) **Published:** July 15, 2019 **Author:** Barbara Hendrickson **Excerpt:** Effective June 1, 2020, Canadian cryptocurrency exchanges and foreign cryptocurrency exchanges serving Canadians will be required by Canada’s Finance Department to register as Money Service Bureaus (MSBs) with FINTRAC (Financial Transactions and Reports Analysis Centre of Canada) to comply with recent amendments to the Proceeds... **Content:** Effective June 1, 2020, Canadian cryptocurrency exchanges and foreign cryptocurrency exchanges serving Canadians will be required by Canada’s Finance Department to register as Money Service Bureaus (MSBs) with FINTRAC (Financial Transactions and Reports Analysis Centre of Canada) to comply with recent amendments to the *Proceeds of Crime (Money Laundering) and Terrorist Financing Act, 2019 (PCMLTFA, 2019, or the Amendments).* The definition of an MSB will be expanded to include domestic and foreign businesses that are “dealing in virtual currency.” These “dealing in” activities will now include virtual or cryptocurrency exchange services and value transfer services. As required of all MSBs, individuals and entities dealing in cryptocurrencies would need to fulfil all obligations, including implementing a full compliance program and registering with FINTRAC. Those reporting entities receiving $10,000 or more in cryptocurrency in deposit or any form of payment, would have to meet record keeping, identification, and reporting obligations. According to the Finance Department, the goal of the Amendments is to close the gaps the exist in Canada’s AML/ATF Regime, by addressing the inherent vulnerabilities in cryptocurrencies for money laundering and terrorist financing. In order to do this in a way that is both consistent with the existing legal framework, while not unduly hindering innovation, the Amendments have been targeted at individuals and entities engaged in the business of dealing in cryptocurrencies, and not the cryptocurrencies themselves. *Canada Gazette, Part 2, Volume 153, Number 14: Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, 2019,* can be found on the [website of the Government of Canada](http://www.gazette.gc.ca/rp-pr/p2/2019/2019-07-10/html/sor-dors240-eng.html). 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. **Categories:** News & Updates **Tags:** AML, ATF, Barbara Hendrickson, BAX Securities Law, Cryptocurrency Exchange, FINTRAC, MSB --- ### [FSRA Announces its Priorities for Auto Insurance, Syndicated Mortgages, Pension Plans, Credit Unions Sectors](https://baxsecuritieslaw.com/fsra-announces-its-priorities-for-auto-insurance-syndicated-mortgages-pension-plans-credit-unions-sectors/) **Published:** July 22, 2019 **Author:** Barbara Hendrickson **Excerpt:** Ontario’s newest financial services regulatory body, the Financial Services Regulatory Authority of Ontario (FSRA), has announced its priorities for the sectors it watches over, intending to provide sector-specific burden reductions while maintaining regulatory effectiveness. Currently, the regulator is in consultations with sectoral stakeholders and reviewing... **Content:** Ontario’s newest financial services regulatory body, the Financial Services Regulatory Authority of Ontario (FSRA), has announced its priorities for the sectors it watches over, intending to provide sector-specific burden reductions while maintaining regulatory effectiveness. Currently, the regulator is in consultations with sectoral stakeholders and reviewing existing guidance to see where opportunities for streamlining processes can be found. - The FSRA says it is close to introducing a new standard rate filing process for the auto insurance sector that will operate on a “file and use” basis. The regulator expects that insurers will be able to, when acting within FSRA-defined boundaries, implement rates in a matter of days. Not only does this act as a service standard for FSRA, but the regulator expects that consumers will receive rates that are more responsive to market conditions and therefore more competitive. - The regulator is conducting a review of syndicated mortgage investments (SMI), including whether the SMI disclosure requirements introduced in July 2018 are ensuring that risks are adequately disclosed to potential investors. After discussions with stakeholders, FSRA staff intend to focus their attention on those investments they deem “unfair” to investors. While targeting those specific transactions, the regulator expects it will also be possible to ease the regulatory burden on the broader sector. - The FSRA is presently in discussions with stakeholders in the pension plan sector. So far, its prime takeaways have included the need to support pension plan flexibility while supporting innovation. - With the amalgamation of the Deposit Insurance Corporation of Ontario (DICO) and the Financial Services Commission of Ontario (FSCO) into the FSRA, the province’s credit unions and *caisse populaires* have been brought under the regulator’s aegis. The FSRA is presently reviewing all applicable guidance and documentation from the two predecessor agencies. After planned stakeholder consultations, and following the statutory rule-making process, the regulator expects to replace the DICO by-law governing credit union disclosure of deposit insurance with a new FSRA rule. The link to the Financial Services Regulatory Authority of Ontario (FSRA) website [can be found here](https://www.fsrao.ca/). 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, FSRA --- ### [Ontario Securities Commission approves settlement with CoinLaunch](https://baxsecuritieslaw.com/ontario-securities-commission-approves-settlement-with-coinlaunch/) **Published:** July 29, 2019 **Author:** Barbara Hendrickson **Excerpt:** An Ontario Securities Commission (OSC) panel has approved a settlement with CoinLaunch Corp. (CoinLaunch) which had formerly operated in the crypto-asset space, penalizing it for engaging in the business of trading in securities without a registration. CoinLaunch, which ultimately chose to cease operations rather than... **Content:** An Ontario Securities Commission (OSC) panel has approved a settlement with CoinLaunch Corp. (CoinLaunch) which had formerly operated in the crypto-asset space, penalizing it for engaging in the business of trading in securities without a registration. CoinLaunch, which ultimately chose to cease operations rather than seek registration, must pay an administrative penalty of CAD $30,000 and disgorge CAD $12,223.06. Reuven Cohen, CoinLaunch’s former CEO, has also agreed not to become or act as a director or officer of any company which engages in or holds itself out as engaging in trading securities, without the applicable registration or an exemption under Ontario securities law. Between March and September 2018, CoinLaunch had advertised and provided services to issuers of crypto-asset tokens which included helping clients administer and promote crypto-asset token offerings. Taken together, these services constituted acts in furtherance of trades and required registration under Ontario securities law. OSC staff note that upon becoming aware of its registration requirements, CoinLanch failed to make use of the supports the regulator had in place to foster Ontario’s emerging crypto-asset sector and that it additionally failed to seek registration or alternately, seek relief from the registration requirements. However, OSC staff also note that during the investigation CoinLaunch cooperated and took steps to remediate its conduct, including shutting down websites, ceasing business operations with token issuers, and ultimately closing its doors. The settlement agreement between the OSC and CoinLanch is [available for download](https://www.osc.gov.on.ca/en/Proceedings_enr_20190724_coinlaunch.htm) from the website of the OSC. 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. **Categories:** News & Updates **Tags:** BAX Securities Law, Coin Launch, Cryptoasset, OSC --- ### [CSA issues Guidance on Climate-Change Related Disclosure](https://baxsecuritieslaw.com/csa-issues-guidance-on-climate-change-related-disclosure/) **Published:** August 6, 2019 **Author:** Barbara Hendrickson **Excerpt:** With the publication of CSA Staff Notice 51-358, Reporting of Climate Change-Related Risks (the Staff Notice), the Canadian Securities Administrators (CSA) continue to set forth their expectations regarding the disclosure by issuers of material risks posed by climate change. While the Staff Notice does not... **Content:** With the publication of *CSA Staff Notice 51-358, Reporting of Climate Change-Related Risks* (the Staff Notice), the Canadian Securities Administrators (CSA) continue to set forth their expectations regarding the disclosure by issuers of material risks posed by climate change. While the Staff Notice does not create any new legal requirements for issuers, it does clarify the requirements listed under *CSA Staff Notice 51-333,* *Environmental Reporting Guidance* (the Environmental Reporting Guidance). CSA staff recommend that the Staff Notice be read in conjunction with the Environmental Reporting Guidance, as it continues to provide guidance to issuers on existing continuous disclosure requirements relating to a broad range of environmental matters, including climate change. While recognizing the importance of the disclosure of material climate change-related risks is important for investors to make informed decisions, CSA staff also realize the disclosure of material climate change-related risks can produce challenges for issuers, especially smaller issuers with more limited resources. The goal of the Staff Notice is to provide all issuers with guidance as to how they might approach preparing disclosures of material climate change-related risks. In addition to addressing regulatory requirements, CSA staff note that disclosing the material climate-change related risks also provides issuers with an opportunity to inform investors about the sustainability of their business model and to provide insights into how they are mitigating and adapting to the risks posed by climate change. *CSA Staff Notice 51-358, Reporting of Climate Change-Related Risks* is [available for download](https://www.osc.gov.on.ca/en/Securitieslaw_csa-20190801_51-358_reporting-of-climate-change-related-risks.htm) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates **Tags:** BAX Securities Law, Climate Change, CSA, CSA Staff Notice 51-358, disclosure --- ### [OSC Publishes Summary Report for Dealers, Advisers, and Investment Fund Managers](https://baxsecuritieslaw.com/osc-publishes-summary-report-for-dealers-advisers-and-investment-fund-managers/) **Published:** August 13, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has published Staff Notice 33-750 Summary Report for Dealers, Advisers and Investment Fund Managers (the Staff Notice or Summary Report), which reviews information impacting registration, information from compliance reviews, and policy initiatives that affect registrants. The four-part Summary Report prepared... **Content:** The Ontario Securities Commission (OSC) has published Staff Notice 33-750 *Summary Report for Dealers, Advisers and Investment Fund Managers* (the Staff Notice or Summary Report), which reviews information impacting registration, information from compliance reviews, and policy initiatives that affect registrants. The four-part Summary Report prepared by the staff of the OSC’s CRR Branch (Compliance and Registrant Regulation), provides registrants with information on the following: - *Education and Outreach*: links and information to the registration and ongoing educational resources and outreach opportunities available to current and prospective registrants. - *Regulatory Oversight Activities and Guidance*: self-assessment tools that can be used by registrants to strengthen compliance with Ontario securities law and, as appropriate, to make changes to enhance their systems of compliance, internal controls, and supervision. - *Impact of Upcoming Initiatives*: insights into some of the new and proposed rules and other regulatory initiatives that may impact a registrant’s operations. - *Registrant Conduct Activities:* this section is intended to enhance the registrant’s understanding of the CRR Branch’s expectations and interpretation of regulatory requirements. It also provides insight into the types of regulatory actions the CRR Branch may take to address non-compliance. OSC Staff Notice 33-750 *Summary Report for Dealers, Advisers and* *Investment Fund Managers* [is available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_sn_20190898_summary-report-for-dealers.htm) from the website of Ontario Securities Commission. 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, CRRBranch, OSC --- ### [CSA Staff Notice 31-335: OBSI 2018 Joint Regulators Annual Report](https://baxsecuritieslaw.com/csa-staff-notice-31-335-obsi-2018-joint-regulators-annual-report/) **Published:** August 17, 2019 **Author:** Barbara Hendrickson **Excerpt:** The 2018 Annual Report of the Joint Regulators Committee (JRC) of the Ombudsman for Banking Services and Investments (OBSI) (the Annual Report) has been published jointly by its member organizations: the Canadian Securities Administrators (CSA), the Investment Industry Regulatory Organization of Canada (IIROC), and the... **Content:** The 2018 Annual Report of the Joint Regulators Committee (JRC) of the Ombudsman for Banking Services and Investments (OBSI) (the Annual Report) has been published jointly by its member organizations: the Canadian Securities Administrators (CSA), the Investment Industry Regulatory Organization of Canada (IIROC), and the Mutual Fund Dealers Association of Canada (MFDA). The goals of the JRC are to promote investor protection and confidence in the external dispute resolution process (the dispute resolution process) and facilitate information sharing and monitor the dispute resolution process between registered dealers and clients; support fairness, accessibility and the effectiveness of the dispute resolution process; and, facilitate the consultation process among JRC members and the OBSI. The Annual Report reviews the actions of the JRC during the past year, which include: - Identifying and addressing systemic issues: In 2018, there was one matter relating to fee disclosure reported to the JRC that OBSI determined as being a systemic issue. In response to OBSI’s notification, the applicable regulator reviewed the matter and took appropriate action; - As part of its mandate to continuously monitor for investor-related complaints of issues such as compensation refusals and the settling for lower amounts than recommended by OBSI, the JRC found no compensation refusals in 2018. However, the JRC noted that among the closed investment-related cases ending with monetary compensation in 2018, approximately 8% were settled for amounts lower than recommended by OBSI as compared with 15% the year before; - The JRC continued to facilitate consultation among its members and the OBSI, providing feedback on proposed changes to the OBSI’s key documents; and, - An independent evaluation of the OBSI and of its practices and investment mandate. The OBSI released its findings in June, 2016, *Independent Evaluation of the Canadian Ombudsman for Banking Services and Investments’ (OBSI) Investment Mandate* (the Report). The JRC was founded as a result of amendments to *National Instrument NI-31-103, Registration Requirements and Ongoing Registrant Obligations* (the Amendments) coming into force in May 2014. The Amendments required all registered dealers and advisers to make OBSI available to their clients as their dispute resolution service. Initially, all participating CSA jurisdictions except for Quebec’s Autorité des marchés financiers (AMF) signed on, with the AMF subsequently joining in 2015. CSA Staff Notice 31-335: 2018 OBSI Joint Regulators Annual Report [is available for download](https://www.bcsc.bc.ca/Securities_Law/Policies/Policy3/PDF/31-335__CSA_Staff_Notice__August_15_2019/) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, CSA, CSA Staff Notice 31-335: 2018 OBSI Joint Regulators Annual Report, JRC, OSBI --- ### [FSRA Issues Request for Comment on Proposed Supervision Approach to High-Risk Syndicated Mortgages and Publishes New Fee Rule for Non Qualified Syndicated Mortgages](https://baxsecuritieslaw.com/fsra-issues-request-for-comment-on-proposed-supervision-approach-to-high-risk-syndicated-mortgages-and-publishes-new-fee-rule-for-non-qualified-syndicated-mortgages/) **Published:** August 17, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Financial Services Regulatory Authority (FSRA) of Ontario’s approach to syndicated mortgage investments started to take shape with the publication of two key documents early in August. The first was the regulator’s Request for Comment - Proposed Supervision Approach for High-risk Syndicated Mortgage Investments (the Proposed... **Content:** The Financial Services Regulatory Authority (FSRA) of Ontario’s approach to syndicated mortgage investments started to take shape with the publication of two key documents early in August. The first was the regulator’s *Request for Comment – Proposed Supervision Approach for High-risk Syndicated Mortgage Investments* (the Proposed Supervisory Approach), which singled out three indicators of potential harm to retail investors: - High loan-to-value ratio; - Inclusion of a subordination clause; and, - Inherent conflict of interest among key participants. The Proposed Supervisory Approach will require brokerages to provide retail investors with additional summary disclosure for syndicated mortgage transactions that have one or more of above indicators. The regulator believes that the additional disclosure will help ensure that retail investors are more informed of the potential risks associated with the potential investment. Brokerages will also be required to file the disclosure form with the FSRA. Comments on the Proposed Supervisory Approach must be received by September 6, 2019. The second was the announcement by the regulator, which deals with non-qualified syndicated mortgage investments. Effective June 8, 2019, subsection *6.3 of FSRA’s New Fee Rule (*the New Fee Rule) requires that within five (5) days after providing the prescribed disclosure to the first potential or actual investor in a non-qualified syndicated mortgage, mortgage brokerages must: - File with FSRA a completed and signed disclosure Form 3.2 – *Disclosure Statement for Investor/Lender in a Non-qualified Syndicated Mortgage*; and, - Pay a $200 fee. The regulator notes that there is a one-time grace period for non-qualified syndicated mortgages brokered between June 8, 2019 and August 13, 2019, where the filing requirements can be completed by August 23, 2019. *Request for Comment – Proposed Supervision Approach for High-risk Syndicated Mortgage Investments* [is available for download](https://www/fsrao/ca/newsroom/request-comment-proposed-supervision-approach-high-risk-syndicated-mortgage-investments) from the website of Financial Services Regulatory Authority of Ontario. *New Fee Rule related to non-qualified syndicated mortgages (subsection 6.3)* [is available for download](https://www/fsrao/ca/newsroom/new-feel-rule-related-non-qualified-syndicated-mortgages-subsection-63) from the website of Financial Services Regulatory Authority of Ontario. 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, disclosure, FSRA, Syndicated Mortgages --- ### [Ontario Securities Commission Issues Staff Notice 11-787 Improving Fee Disclosure Through Behavioural Insights](https://baxsecuritieslaw.com/ontario-securities-commission-issues-staff-notice-11-787-improving-fee-disclosure-through-behavioural-insights/) **Published:** August 27, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has issued Staff Notice 11-787 Improving Fee Disclosure Through Behavioural Insights (the Staff Notice), outlining the findings of a research report (the Report) aimed at improving the investor’s experience with correspondingly better market outcomes through behaviorally-informed tactics for designing more... **Content:** The Ontario Securities Commission (OSC) has issued Staff Notice 11-787 Improving Fee Disclosure Through Behavioural Insights (the Staff Notice), outlining the findings of a research report (the Report) aimed at improving the investor’s experience with correspondingly better market outcomes through behaviorally-informed tactics for designing more effective investment fee disclosures. The Report, which is appended to the Staff Notice, focuses on the annual fee reports (the annual fee report) on charges and other compensation investors receive from registered dealers or advisers. OSC staff noted that while many investors benefit from the information included in these reports, other investors, even though they have received their reports, may not notice them or even understand how their dealer or adviser is compensated for their services. The Report identified the three key barriers to investors using the information found in their annual reports as intended: - Barriers to engagement: Investors may not notice or recognize the importance of their annual fee report amid the various other disclosures provided to them. - Barriers to comprehension: Investors may be confused by the terminology and information included in their annual fee report. They may not understand which fees are included (and which are excluded) from the report, and lack reference points to determine whether their fees are higher or lower than the norm. - Barriers to action: Even if investors see and understand their report, they may not know how to act on the information it provides. The Report also identified twenty-four tactics registrants and other stakeholders can use to help investors to overcome these barriers. Some of these include: using electronic alerts or notifications that attract investors’ attention or, if the annual fee report is being provided by mail, including attention-grabbing language or visuals on the envelope; testing and employing simpler terms to describe key concepts and different types of fees; and, listing actions investors can take to reduce their investment fees or increase the level of service they receive for those fees. OSC Staff Notice 11-787, Improving Fee Disclosure Through Behavioural Insights [is available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_sn_20190819_11-787_improving-fee-disclosure-through-behavioural-insights.htm) from the website of 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, disclosure, OSC, OSC Staff Notice11-787 --- ### [Canadian Securities Administrators Issue Staff Notice 31-356, Guidance on Compliance Consultants Engaged by Firms Following a Regulatory Decision](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-staff-notice-31-356-guidance-on-compliance-consultants-engaged-by-firms-following-a-regulatory-decision/) **Published:** August 27, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has provided guidance to firms seeking to engage the services of compliance consultants (Consultants) following a regulatory decision. CSA Staff Notice 31-356, Guidance on Compliance Consultants (The Staff Notice) defines the scope and role of compliance consultants. In detail, the... **Content:** The Canadian Securities Administrators (CSA) has provided guidance to firms seeking to engage the services of compliance consultants (Consultants) following a regulatory decision. CSA Staff Notice 31-356, Guidance on Compliance Consultants (The Staff Notice) defines the scope and role of compliance consultants. In detail, the purpose of the Staff Notice is to: - help firms identify, evaluate and engage appropriate Consultants to assist them to effectively address their compliance deficiencies on a timely basis, as CSA staff do not endorse or recommend any Consultants; - provide transparency on the CSA staff’s process and criteria for approving or accepting a Consultant proposed by a firm; and, - inform Consultants and firms about the CSA staff’s expectations for a Consultant’s engagement, including their role, and the format and content for reporting improve the oversight and remediation processes of Firms subject to a Regulatory Decision by increasing their consistency, efficiency and effectiveness. As defined by CSA staff, a Consultant may be a lawyer, public accountant, experienced compliance professional, former securities regulator, management or risk consultant, experienced industry person, or some combination of these roles. Their role is to provide professional advice and services in respect of compliance with securities law, relevant industry rules, industry best practices, and development of systems regarding controls and supervision. The regulator has final approval over the hiring of the Consultant by the firm. A Consultant is typically engaged by a firm following a regulatory action by CSA staff, a decision by a director, or as a result of a compliance order following an investigation by a regulator, where significant non-compliance with securities law has been identified. If the firm in question is required to bring a consultant on board, it could be as a result of terms and conditions placed on the firm’s registration; an order that the firm submit to a review of its practices and procedures; or, an order approving a settlement agreement with the firm, all of which create a requirement under securities law. CSA Staff Notice 31-356, Guidance on Compliance Consultants [is available for download](https://www.bcsc.bc.ca/31-356_%5BCSA_Staff_Notice%5D_08222019/) from the websites of participating jurisdictions. 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, Compliance, Consultants, CSA --- ### [Royal Bank of Canada, Toronto Dominion Bank to Pay OSC Over $24 Million for Foreign Exchange Compliance Failures](https://baxsecuritieslaw.com/royal-bank-of-canada-toronto-dominion-bank-to-pay-osc-over-24-million-for-foreign-exchange-compliance-failures/) **Published:** September 4, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Royal Bank of Canada (RBC) and the Toronto Dominion Bank (TD) have agreed to pay the Ontario Securities Commission (OSC) over CAD $24 million for their failure to properly supervise their respective Foreign Exchange (FX) traders who exchanged confidential client information via online chatrooms.... **Content:** The Royal Bank of Canada (RBC) and the Toronto Dominion Bank (TD) have agreed to pay the Ontario Securities Commission (OSC) over CAD $24 million for their failure to properly supervise their respective Foreign Exchange (FX) traders who exchanged confidential client information via online chatrooms. In the course of their investigation, OSC Staff discovered hundreds of instances between 2011 and 2013 where RBC and TD FX traders disclosed confidential transaction details, such as trade sizes, timing, price, or stop-loss levels. In the view of the regulator, this information allowed the traders to gain a potentially unfair advantage in the market. Moreover, the regulator found that the FX supervisors at both banks permitted the continued exchange of confidential client information, with neither imposing a chatroom ban until 2013. Even with the ban in place, the OSC found it was not effectively enforced until 2015 because of the inadequate internal controls at both banks at the time. The OSC was careful to point out that there was no allegations of, or any evidence of an attempt to manipulate FX benchmark rates. For its part, RBC agreed to voluntarily pay $13.552 million to the OSC, plus a further $800,000 to cover the costs of the investigation. Meanwhile, TD has agreed to make a voluntary payment of $9.3 million to the regulator, with an additional $800,000 towards the investigation. The OSC notes that the voluntary settlement amounts reflect both banks’ cooperation with staff during the investigation. Both banks have also agreed to audit the compliance frameworks of their respective FX businesses. The regulator is now turning an eye towards Ontario’s derivatives dealers to assess whether they have sufficient controls in place to manage the risks faced by their FX trading businesses. OSC staff note that they will review their findings, and coordinate with other Canadian regulators as appropriate. The settlement agreements with both [RBC](https://www.osc.gov.on.ca/en/Proceedings_enr_20190830_royal-bank.htm) and [TD](https://www/osc/gov.on/ca/en/Proceedings_enr_20190830_the-toronto-dominion-bank.htm) are available from the website of the Ontario Securities Commission. 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, Foreign Exchange, FX, OSC, RBC, TD --- ### [CSA Seeks Comment on Proposed Amendments to Business Acquisition Report Requirements](https://baxsecuritieslaw.com/csa-seeks-comment-on-proposed-amendments-to-business-acquisition-report-requirements/) **Published:** September 6, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published for a request for comment to proposed amendments to the business acquisition report (BAR) requirements for reporting issuers that are not venture issuer (e.g. an investment fund). The ninety-day comment period ends December 4, 2019. The proposed amendments... **Content:** The Canadian Securities Administrators (CSA) have published for a request for comment to proposed amendments to the business acquisition report (BAR) requirements for reporting issuers that are not venture issuer (e.g. an investment fund). The ninety-day comment period ends December 4, 2019. The proposed amendments and changes impact National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102); Companion Policy 51-102CP Continuous Disclosure Obligations (Companion Policy 51-102CP); Companion Policy 41-101CP to National Instrument 41-101 General Prospectus Requirements (Companion Policy 41-101CP); Companion Policy 44-101CP to National Instrument 44-101; and, Short Form Prospectus Distributions (Companion Policy 44-101CP) (together, the Proposed Amendments). The aim of the Proposed Amendments is to reduce regulatory burden and address certain concerns expressed by stakeholders by narrowing the circumstances under which a BAR must be filed. Currently, a BAR must be filed by reporting issuer who is not an venture issuer after completing a significant acquisition. Part 8 of NI 51-102 (Part 8) sets out three significance tests for the filing of a BAR: the asset test, the investment test, and the profit or loss test. A filing of a BAR under Part 8 for an acquisition of a business or related businesses that is a significant acquisition must occur when: - a reporting issuer that is not a venture issuer, if the result from any one of the three significance tests exceeds 20%; and, - a venture issuer, if the result of either the asset test or investment test exceeds 100% (collectively, the BAR requirements). The BAR requirements were introduced in 2004 to provide investors with relatively timely access to historical financial information on a significant acquisition. They also require a reporting issuer that is not a venture issuer to prepare and file pro forma financial statements. *CSA Notice and Request for Comment Proposed Amendments to National Instrument 51-102 Continuous Disclosure Obligations and Changes to Certain Policies Related to the Business* *Acquisition Report Requirements*, [is available for download](http://www.bcsc.bc.ca/51-102_%5BCSA_Notice_and_Request_for_Comment%5D_09052019/) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates **Tags:** Barbara Hendrickson, BAX Securities Law, Business Acquisition Report, NI-51-502 --- ### [Canadian Securities Administrators Introduce Eight Initiatives to Reduce Regulatory Burden for Investment Funds](https://baxsecuritieslaw.com/canadian-securities-administrators-introduce-eight-initiatives-to-reduce-regulatory-burden-for-investment-funds/) **Published:** September 16, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Security Administrators (CSA) have introduced for a ninety-day comment period ending December 11, 2019, eight initiatives (collectively, The Proposed Amendments) that seek to reduce the regulatory burden on investment funds by eliminating duplicate requirements, streamlining regulatory processes, codifying frequently-granted exemptions from certain rules... **Content:** The Canadian Security Administrators (CSA) have introduced for a ninety-day comment period ending December 11, 2019, eight initiatives (collectively, The Proposed Amendments) that seek to reduce the regulatory burden on investment funds by eliminating duplicate requirements, streamlining regulatory processes, codifying frequently-granted exemptions from certain rules for investment funds, and eliminating the need for certain regulatory approvals. The Proposed Amendments are part of the CSA’s two-phase plan to reduce the regulatory burden for investment funds, which began in 2016. In Phase One, CSA Staff conducted a comprehensive review of the existing investment fund disclosure regulatory landscape, as well as examining disclosure reporting for non-investment funds, and best practices from other jurisdictions. CSA Staff also undertook meetings with key stakeholders. This work resulted in the Proposed Amendments which are being introduced for comment in Phase 2. In summary, the Proposed Amendments break down into eight individual work streams: • Consolidating the Simplified Prospectus and the Annual Information Form; • Investment Funds Designated Websites; • Codifying Exemptive Relief Granted in Respect of Notice-and-Access Applications; • Minimizing Filings of Personal Information Forms; • Codifying Exemptive Relief Granted in Respect of Conflicts Applications; • Broadening Pre-Approval Criteria for Investment Fund Mergers; • Repealing Regulatory Approval Requirements for Change of Manager, Change of Control of a Manager, and Change of Custodian that Occurs in Connection with a Change of Manager; and, • Codifying Exemptive Relief Granted in Respect of Fund Facts Delivery Applications. The Proposed Amendments impact a wide range of national instruments and allied companion policies: National Instrument 14-101 Definitions (NI 14-101); National Instrument 41-101 General Prospectus Requirements (NI 41-101); National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101); National Instrument 81-102 Investment Funds (NI 81-102); National Instrument 81-106 Investment Fund Continuous Disclosure (NI 81-106); National Instrument 81-107 Independent Review Committee for Investment Funds (NI 81-107); National Instrument 13-101 System for Electronic Document Analysis and Retrieval (SEDAR); Multilateral Instrument 13-102 System Fees for SEDAR and NRD; National Policy 11-202 Process for Prospectus Reviews in Multiple Jurisdictions; Companion Policy 41-101CP to National Instrument 41-101General Prospectus Requirements; Companion Policy 81-101CP to National Instrument 81-101 Mutual Fund Prospectus Disclosure Companion Policy 81-102CP to National Instrument 81-102 Investment Funds Companion Policy 81-106CP to National Instrument 81-106 Investment Fund Continuous Disclosure (81-106CP); and, Commentary in National Instrument 81-107 Independent Review Committee for Investment Funds. CSA Notice and Request for Comment, Reducing Regulatory Burden for Investment Fund Issuers – Phase 2, Stage 1 is [available for download](https://www.osc.gov.on.ca/documents/en/Securities-Category4/ni_20190912_41-101_reducing-regulatory-burden-for-investment-fund-issuers.pdf) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [Ontario Securities Commission Publishes 2019 Annual Report](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-2019-annual-report/) **Published:** September 18, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has published its 2019 Annual Report (the Annual Report), providing a snapshot of the regulator’s initiatives and actions over the past year. In the Annual Report, the OSC noted that in 2018 -2019: • there were 68,366 registered individuals in... **Content:** The Ontario Securities Commission (OSC) has published its 2019 Annual Report (the Annual Report), providing a snapshot of the regulator’s initiatives and actions over the past year. In the Annual Report, the OSC noted that in 2018 -2019: • there were 68,366 registered individuals in Ontario; • Ontario-based listed issuers account for 50% of Canada’s equity market value $362.2 billion in corporate bonds outstanding from Ontario-based issuers; • 1,807 foreign firms operate in Ontario capital markets 63% of registered firms with head offices in Canada have their head office in Ontario; and, • 95% of all Canadian over-the-counter (OTC) derivatives trading included an Ontario Market participant. In terms of enforcement action, during the past year, the regulator reported that: • 565 cases were assessed by the OSC’s Enforcement branch; • 79 administrative sanctions were issued by the OSC; • One no-contest settlement led to $11 million being returned to investors; • 51 months of jail sentences were ordered; and, • 22 individuals were banned from trading or serving as a director for an average of 10.5 years each. The OSC Annual Report 2019 is [available for download](https://www.osc.gov.on.ca/en/Publications_annual-report_index.htm) from the website of Ontario Securities Commission. 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. **Categories:** News & Updates --- ### [Ontario Securities Commission Introduces Flexible Fee Certification Process for Market Participants](https://baxsecuritieslaw.com/ontario-securities-commission-introduces-flexible-fee-certification-process-for-market-participants/) **Published:** September 19, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has announced that it is amending the fee rules (the Rules) for the submitting of annual capital market participation fee forms (the Fee Forms) to the OSC to allow market participants great flexibility. All market participants are required on an... **Content:** The Ontario Securities Commission (OSC) has announced that it is amending the fee rules (the Rules) for the submitting of annual capital market participation fee forms (the Fee Forms) to the OSC to allow market participants great flexibility. All market participants are required on an annual basis to pay a participation fee to the OSC. This is done according to the fee calculation form (the Fee Calculation Form). Currently, it is the role of the firm’s Chief Compliance Officer (CCO) to certify the Fee Calculation Form for completeness and accuracy and to submit the Fee Form in a timely fashion to the OSC. In the case of an unregistered capital markets participant without a CCO, this is done by an individual acting in a similar capacity. The Rule Amendments would change OSC Rules 13-502 and 13-503 to allow others identified in the Rule Amendments to certify the Fee Forms. Generally, this would mean that the CFO or other specified individual who might typically be responsible at the firm for preparing the fee calculation would now be allowed to submit the Fee Form directly to the Commission without requiring additional review by the CCO to certify the Fee Form. The OSC believes that this will result in a time savings for the submitting firm. The regulator notes that it is still permissible for a firm to have its CCO certify its Fee Forms. Notice of Amendments to Ontario Securities Commission Rule 13-502 Fees and OSC Rule 13-503 (Commodity Futures Act) Fees [is available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20190912_13-502_13-503_amendments-fees.htm) from the website of the Ontario Securities Commission. 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. **Categories:** News & Updates --- ### [BCSC Imposes $1.7 M in Fines, Lifetime Bans for on Three Men, two MICs for Fraud](https://baxsecuritieslaw.com/bcsc-imposes-1-7-m-in-fines-lifetime-bans-for-on-three-men-two-mics-for-fraud/) **Published:** September 24, 2019 **Author:** Barbara Hendrickson **Excerpt:** A British Columbia Securities Commission (BCSC) panel has imposed a total of CAD $1.7 million in fines and lifetime securities trading bans on three British Columbia men and two Mortgage Investment Corporations (MICs) after finding them guilty of committing fraud. At the time, David Scott... **Content:** A British Columbia Securities Commission (BCSC) panel has imposed a total of CAD $1.7 million in fines and lifetime securities trading bans on three British Columbia men and two Mortgage Investment Corporations (MICs) after finding them guilty of committing fraud. At the time, David Scott Wright (Wright ), Donald Bruce Wilson (Wilson), and Patrick K. Prinster (Prinster) and the DominionGrand II Mortgage Investment Corporation (MIC II) and the DominionGrand Investment Fund Inc. (MIC III), were primarily engaged in the investment of capital in mortgages secured by real estate. The panel had found that funds invested in MICs II and III had been diverted to companies related to the respondents, breaching section 57(b) of the Securities Act, RSBC 1996 (the Act). Although most all of the $1.1 million raised from investors was lost, except for some funds paid back to investors as purported returns, the BCSC panel found no evidence that Prinster, Wright, or Wilson as individuals had personally gained by the diversion of the investment funds. Additionally, while the panel found no evidence that the individual respondents beneficially owned the related companies or any evidence of what those entities did with the funds, it also noted that the three men had diverted the funds “despite warnings and concerns expressed to them from multiple sources.” The panel cast aside assertions from Wilson, Wright, and Prinster that their misconduct was simply due to a failure to provide better disclosure to their investors. In summation, the panel found: • the DominionGrand II Mortgage Investment Corporation (MIC II) had breached section 57(b) of the Act, defrauding 19 investors for a total of $610,1341; • DominionGrand Investment Fund Inc. (MIC III) had contravened section 57(b) of the Act, defrauding 21 investors for a total of $506,693; • Wright, Wilson, and Prinster had contravened section 57(b) of the Act, for defrauding 19 investors each, for a total of $610,134, and both Wright and Prinster had breached section 57(b) of the Act, for defrauding 21 investors for a total of $506,693. The panel also permanently banned Prinster, Wright, and Wilson from trading in or purchasing securities or exchange contracts; using the exemptions set out in the Act; becoming or acting as a registrant or promoter; becoming or acting as a director or officer of any issuer or registrant; acting in a management or consultative capacity in the securities market; and, engaging in investor relations. The three men were ordered to resign any position they may have held as officers or directors. In addition, the panel also imposed fines of $561,479 on DominionGrand II Mortgage Investment Corporation, and $500,961 on DominionGrand Investment Fund Inc. Both companies also received permanent bans on trading in or purchasing securities or exchange contracts; using the exemptions set out in the Act; becoming or acting as a registrant or promoter; acting in a management or consultative capacity in the securities market; and, engaging in investor relations. The link to British Columbia Securities Commission Securities Act, RSBC 1996, c. 418 Citation: Re DominionGrand, 2019 BCSECCOM 335, can be found on [the website of the BCSC.](https://www.bcsc.bc.ca/Enforcement/Decisions/PDF/2019_BCSECCOM_335/) 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. **Categories:** News & Updates --- ### [BCSC Issues Guidelines and Expectations for the Electronic Filing of Reports of Exempt Distribution](https://baxsecuritieslaw.com/bcsc-issues-guidelines-and-expectations-for-the-electronic-filing-of-reports-of-exempt-distribution/) **Published:** October 6, 2019 **Author:** Barbara Hendrickson **Excerpt:** 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... **Content:** 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. **Categories:** News & Updates --- ### [CSA Publishes Results of Fifth Staff Review of Disclosure Regarding Women on Boards and in Executive Officer Positions](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-csa-multilateral-staff-notice-58-310-report-on-fourth-staff-review-of-disclosure-regarding-women-on-boards-and-in-executive-officer-positions-2/) **Published:** October 7, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA), along with its participating jurisdictions, have published Multilateral Staff Notice, 58-311, Report on Fifth Staff Review of Disclosure Regarding Women on Boards and in Executive Officer Positions (the Report). In summary, the Report noted these key trends: • 73% of... **Content:** The Canadian Securities Administrators (CSA), along with its participating jurisdictions, have published Multilateral Staff Notice, 58-311, Report on Fifth Staff Review of Disclosure Regarding Women on Boards and in Executive Officer Positions (the Report). In summary, the Report noted these key trends: • 73% of issuers had at least one woman on their boards, up 7% from the previous year; • Although 17% of board seats were held by women, the report noted this number tended to increase with the size of the issuer and varied by industry. This latter number was also up by 2% from the previous year; • 33% of all issuers’ vacated board seats were occupied by women, up from 29% in the previous year; • Of all issuers, 5% had board chairs who were women, with 4% in the CEO’s position and 15% in the CFO’s role. 64% of issuers had at least one woman in an executive officer position. These numbers tended to remain largely unchanged over the previous year; and, • 50% of issuers had adopted policies relating to the representation of women on their boards, while 22% had adopted targets for the representation of women on their boards, and 3% had adopted targets for women in executive roles. The Report also looked at director term limits and board renewal. It found that 21% of all issuers had some form of director term limits, while 36% of issuers had some other form board renewal, but 39% had no such plans in place. The percentage of issuers with term limits in place remained unchanged from the previous year. The Report summarizes results from a review of the disclosure of 641 issuers with year-ends between December 31, 2018, and March 31, 2019. The review, conducted by the participating jurisdictions, focuses on disclosure requirements regarding the representation of women on boards and in executive officer positions, as set out in National Instrument 58-101 Disclosure of Corporate Governance Practices. Multilateral Staff Notice, 58-311, Report on Fifth Staff Review of Disclosure Regarding Women on Boards and in Executive Officer Positions is available for [download from the websites](https://www.osc.gov.on.ca/en/SecuritiesLaw_sn_20191002_58-311_staff-review-women-on-boards.htm) of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [CSA Publishes Amendments to NI-31-103, Registration Requirements, Exemptions and Ongoing Registrant Obligations](https://baxsecuritieslaw.com/csa-publishes-amendments-to-ni-31-103-registration-requirements-exemptions-and-ongoing-registrant-obligations/) **Published:** October 11, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA), along with its participating jurisdictions, have published Amendments to NI-31-103, Registration Requirements, Exemptions and Ongoing Registrant Obligations, and to its allied companion policy, CP-31-103 (together, the Amendments). The Amendments once adopted will require registrants to address material conflicts of interest... **Content:** The Canadian Securities Administrators (CSA), along with its participating jurisdictions, have published Amendments to NI-31-103, Registration Requirements, Exemptions and Ongoing Registrant Obligations, and to its allied companion policy, CP-31-103 (together, the Amendments). The Amendments once adopted will require registrants to address material conflicts of interest in the best interest of their clients and put clients’ interests first when determining the suitability of investments. They introduce new obligations on registered individuals and firms (registrants) and codify best practices when considering the suitability of clients for investments. The Amendments introduce a Know Your Product (KYP) provision and will strengthen existing Know Your Client (KYC), Conflict of Interest, and Relationship Disclosure Information (RDI) provisions. In detail: • The new KYP provisions set out obligations for both firms and registered individuals regarding suitability determination and conflict of interest requirements; • The amended KYC requirements will support the enhanced suitability determination requirements; • The amended Conflict of Interest provisions will support the new obligation of registrants to address conflicts in the best interests of their clients, with requirements regarding the disclosure of material conflicts; • The amendments to the RDI provisions will require registrants to inform clients regarding potentially significant costs, restrictions, and limitations regarding the product or service being offered; and, • The Amendments also feature new provisions including those regarding misleading communications and additions to internal controls that require firms to provide training to their registered individuals. These new and strengthened provisions set out the expectations of the regulators regarding the fundamental obligations of registrants towards investors. They are designed to work together throughout the client-registrant relationship and act as an extension of the registrants to deal fairly, honestly, and in good faith with clients. The Amendments and their attendant provisions will become effective December 31, 2019, subject to ministerial approval. There will be a phased transition period, with the changes relating to conflicts of interest and the associated relationship disclosure provisions taking effect on December 31, 2020, and the remaining changes taking effect on December 31, 2021. Amendments to NI-31-103, Registration Requirements, Exemptions and Ongoing Registrant Obligations, and to Companion Policy CP-31-103, Registration Requirements, Exemptions and Ongoing Registrant Obligations, is available for [download from the websites](https://www.bcsc.bc.ca/31-103_%5bCSA_Notice%5d_10032019/) of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [CSA Publishes Notice and Request for Comment Proposed Amendments to National Instrument 52-108 Auditor Oversight and Proposed Changes to Companion Policy 52-108 Auditor Oversight](https://baxsecuritieslaw.com/csa-publishes-notice-and-request-for-comment-proposed-amendments-to-national-instrument-52-108-auditor-oversight-and-proposed-changes-to-companion-policy-52-108-auditor-oversight/) **Published:** October 16, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA), along with its participating jurisdictions, have published Notice and Request for Comment Proposed Amendments to National Instrument 52-108 Auditor Oversight and Proposed Changes to Companion Policy 52-108 Auditor Oversight (together, the Proposed Amendments), for a comment period ending January 1st,... **Content:** The Canadian Securities Administrators (CSA), along with its participating jurisdictions, have published Notice and Request for Comment Proposed Amendments to National Instrument 52-108 Auditor Oversight and Proposed Changes to Companion Policy 52-108 Auditor Oversight (together, the Proposed Amendments), for a comment period ending January 1st, 2020. The Proposed Amendments specifically cover the audit work done for reporting issuers with operations within foreign jurisdictions. Currently, Participating Audit Firms (PAFs) under Canadian Public Accountability Board (CPAB) auspices often utilize the services of audit firms in these locales (known as component auditors) to support the auditor’s report issued by the PAF. Because these component auditors are not under CPAB’s jurisdiction, the regulator has experienced difficulty in obtaining the audit records from some firms. If approved, the Proposed Amendments will enable CPAB to perform audit inspections of the work of those component auditors who are employed by PAFs at a significant level (significant component auditors). If a given significant component auditor did not voluntarily agree to an inspection, under the Proposed Amendments, reporting issuers will be required to direct them to enter into an agreement with CPAB permitting access to the audit files (a CPAB access agreement) which gives CPAB the ability, upon request, to inspect the audit work. If the component auditor refuses to enter into a CPAB access agreement, a PAF after a transition period would not be permitted to use the audit firm as a significant component auditor. Notice and Request for Comment Proposed Amendments to National Instrument 52-108 Auditor Oversight and Proposed Changes to Companion Policy 52-108 Auditor Oversight, are available for [download from the websites](https://www.bcsc.bc.ca/52-108_%5bCSA_Notice_and_Request_for_Comment%5d_10032019/) of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [TSX Venture Exchange Amends Corporate Finance Manual to Reduce Frequency of Filings](https://baxsecuritieslaw.com/tsx-venture-exchange-amends-corporate-finance-manual-to-reduce-frequency-of-filings/) **Published:** October 23, 2019 **Author:** Barbara Hendrickson **Excerpt:** The TSX Venture Exchange (TSXV) has announced amendments (the Amendments) to its Corporate Finance Manual (the Manual) to reduce the frequency by which directors, officers, promoters, and other insiders (individuals) have to submit a Form 2A (The Personal Information Form or PIF). The Amendments are... **Content:** The TSX Venture Exchange (TSXV) has announced amendments (the Amendments) to its Corporate Finance Manual (the Manual) to reduce the frequency by which directors, officers, promoters, and other insiders (individuals) have to submit a Form 2A (The Personal Information Form or PIF). The Amendments are effective immediately. Together, the TSXV is Amending: i) the PIF, ii) the Form 2C1- Declaration (the Declaration), and (iii) sections 1.7 and 4.8 of Policy 2.3, Listing Procedures (Policy 2.3), and iv) section 7.7 (a) of Policy 3.2 – Filing Requirements and Continuous Disclosure of the Manual. The goal of the Amendments is to reduce the regulatory burden on issuers by reducing the time and cost involved with individuals having to complete PIFs. Previously under the Manual, if an individual who had submitted a PIF within 36 months (3 years) and was required to submit a second PIF, they would be allowed to submit a Declaration in place of the PIF. Under the Amendments, the TSXV will accept a Declaration in place of a PIF if the individual has submitted a PIF within the last 60 months (5 years). The Declaration asks the individual to confirm the accuracy of the information on the PIF that the individual had most recently submitted. The full text of the amended Policy 2.3 and Policy 3.2 is available for [download from the website](https://www.tsx.com/listings/tsx-and-tsxv-issuer-resources/tsx-venture-exchange-issuer-resources/tsx-venture-exchange-corporate-finance-manual/tsxv-corporate-finance-manual-policies) of the TSXV. 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. **Categories:** News & Updates --- ### [British Columbia Government Introduces Major Updates with the Securities Amendment Act, 2019](https://baxsecuritieslaw.com/british-columbia-government-introduces-major-updates-with-the-securities-amendment-act-2019/) **Published:** October 29, 2019 **Author:** Barbara Hendrickson **Excerpt:** On October 2, 2019, the Government of British Columbia introduced proposed legislation that would provide a sweeping set of updates to existing provincial securities law, Bill 33 – 2019, the Securities Amendment Act, 2019 (the Act.) Once given Royal Assent and enacted into law, the... **Content:** On October 2, 2019, the Government of British Columbia introduced proposed legislation that would provide a sweeping set of updates to existing provincial securities law, *Bill 33 – 2019, the Securities Amendment Act, 2019* (the Act.) Once given Royal Assent and enacted into law, the Act will modernize and strengthen the existing provincial securities regulation framework supporting the British Columbia Securities Commission (BCSC) and establish a modern system for regulating derivatives and benchmarks that are harmonized with other jurisdictions across Canada, such as Alberta and Ontario. It is the first significant update to provincial securities legislation since 2011. The amendments in the Act will come into force through regulation. The amendments to improve the BCSC’s enforcement powers include: - increasing maximum fine and jail term amounts and introducing minimum sentences for people who are convicted of significant offences multiple times; - expanding the BCSC’s investigative powers, including powers to obtain information; - strengthening obligations and sanctions relating to records; - adding an ability to order administrative monetary penalties without a hearing for - contraventions of regulations or decisions; and, - adding protection for whistleblowers. Amendments to improve the BCSC’s collection powers include: - providing the BCSC with enhanced powers to freeze and seize property transferred by - fraudsters to third parties for below market value; - allowing the BCSC to direct the Insurance Corporation of BC (ICBC) to refuse to issue or renew a driver’s licence or licence plates; and, - allowing the BCSC to seize registered retirement savings plans. Amendments to establish a new regime for derivatives include: - representations (e.g., false and misleading); - prohibitions on making certain representations about derivatives, underlying interests of derivatives, benchmarks or benchmark administrators or investors; - manipulation and fraud; - right of action against a person required to send a prescribed disclosure document; - halt trading orders; - enforcement orders (e.g. cease-trade and disgorgement) and regulation-making powers; - providing a clear power to regulate trade repositories; and, - providing the BCSC with the ability to regulate benchmarks consistent with the framework for regulating benchmarks that are already established in other jurisdictions across Canada. Also included in the Act are amendments that are aimed at modernization. These include: - expanding the BCSC’s powers regarding corporate transactions; - modernizing the prohibition on securities registrants using another registrant’s name; - ensuring that B.C.’s regime for civil liability aligns with all other jurisdictions in Canada; and, - general housekeeping. The backgrounder published by the BC Ministry of Finance on *Bill 33 – 2019, the Securities Amendment Act, 2019* can be viewed [here.](https://news.gov.bc.ca/releases/2019FIN0112-002020) 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. **Categories:** News & Updates --- ### [Ontario Government Completes Review of Business Law, Asks for Recommendations](https://baxsecuritieslaw.com/ontario-government-completes-review-of-business-law-asks-for-recommendations/) **Published:** November 1, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Government of Ontario’s Ministry of Government and Consumer Services (MGCS) has completed its review of key elements of Ontario business law and is now requesting input from stakeholders. The proposed changes include amendments to the Business Corporations Act (OBCA) and amendments to the Arthur... **Content:** The Government of Ontario’s Ministry of Government and Consumer Services (MGCS) has completed its review of key elements of Ontario business law and is now requesting input from stakeholders. The proposed changes include amendments to the Business Corporations Act (OBCA) and amendments to the Arthur Wishart Act (Franchise Disclosure), 2000 (AWA). Proposed amendments to the OBCA include: - Removal of the current requirement under the OBCA that at generally, at least 25% of a business corporations’ directors be Canadian residents; - Amending the OBCA to lower the approval threshold for a written shareholder resolution instead of a meeting for privately-held corporations. This is proposed to be done by lowering written shareholder approval to a majority of the voting shares – or special majority for certain decisions – instead of the current requirement for a unanimous written resolution; and, - Amending the OBCA to allow corporations to relieve or limit the liability of fiduciaries (e.g. directors and officers) arising from the corporate opportunity doctrine by allowing fiduciaries to pursue certain business opportunities without fear of liability arising from their duties in certain circumstances. The MGCS is also proposing to amend the AWA by clarifying what it sees as existing ambiguities in law by bringing into force related amendments to the regulations under the AWA. Proposed amendments could include: - The manner of determining “Total Initial Investment” for minimum and large investment thresholds; - Any changes to the minimum and large investment threshold amounts for exemptions from disclosure; - The amount of the franchise deposit paid under a fully refundable deposit agreement that does not bind a prospective franchisee to enter into a franchise agreement would be exempt from disclosure; - The information that must be contained in a Statement of Material Change; and, - The accounting standards for financial statements that must be included in the Disclosure Document. MGCS is also proposing additional amendments to the Personal Property Security Act*,* which are not covered here. The deadline for comments is November 26, 2019. The Ontario Ministry of Ministry of Government and Consumer Services has posted a detailed backgrounder on the proposed amendments [on its website.](https://www.ontariocanada.com/registry/showAttachment.do?postingId=30607&attachmentId=41836) 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Reviews Automatic Securities Disposition Plans](https://baxsecuritieslaw.com/canadian-securities-administrators-reviews-automatic-securities-disposition-plans/) **Published:** November 1, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA), along with its participating jurisdictions, is conducting a review of Automatic Securities Disposition Plans (ASDPs). ASDPs allow insiders to carry out preplanned sales of securities of an issuer through an arms-length administrator, according to a predetermined set of instructions. The... **Content:** The Canadian Securities Administrators (CSA), along with its participating jurisdictions, is conducting a review of Automatic Securities Disposition Plans (ASDPs). ASDPs allow insiders to carry out preplanned sales of securities of an issuer through an arms-length administrator, according to a predetermined set of instructions. The goal of the review is to ensure that ADSPs continue to remain a legitimate mechanism of trading by insiders. At the moment, provincial and territorial securities laws provide an insider trading defence for trades made under automatic plans, but there is no national framework regarding ADSPs. CSA staff will look at the possibility of establishing a national harmonized regulatory framework governing ADSPs. It will consider whether existing provincial plans provide sufficient constraints on trading activities of insiders and will be informed by relevant international developments in this area. Another area to be considered is whether exemptions from insider reporting for trades done under ASDPs should continue to be granted under certain circumstances. While not requested by all issuers establishing ADSPs, there have been several exemptions granted over the last ten years. Until the CSA completes its review and updates the market on its conclusions, CSA staff are unlikely to recommend new insider reporting relief for trades done under ASDPs. Existing insider reporting relief will be unaffected. 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. **Categories:** News & Updates --- ### [Ontario Securities Commission Overturns Bitcoin Fund Ruling, Issues Receipt for Final Prospectus](https://baxsecuritieslaw.com/ontario-securities-commission-overturns-bitcoin-fund-ruling-issues-receipt-for-final-prospectus/) **Published:** November 1, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has overturned a prior OSC ruling and has issued a receipt for the final prospectus of the Bitcoin Fund (the Fund). The Manager of the Fund (3iQ Corp.) announced in October 2018 that the Fund, had filed a non-offering prospectus... **Content:** The Ontario Securities Commission (OSC) has overturned a prior OSC ruling and has issued a receipt for the final prospectus of the Bitcoin Fund (the Fund). The Manager of the Fund (3iQ Corp.) announced in October 2018 that the Fund, had filed a non-offering prospectus to create the “first regulated Bitcoin fund in the world.” It was structured as a non-redeemable investment fund (NRIF) established under the laws of the Province of Ontario. An OSC Director’s [decision made in February 2019,](https://lawfirmbarbara.wpengine.com/ontario-securities-commission-refuses-to-issue-receipt-for-the-bitcoin-funds-prospectus/) denied issuance a receipt for the Fund’s prospectus on the grounds that bitcoin was an illiquid asset and did not comply with NI 81-102, *Investment Funds* and its restriction against holding illiquid assets. The decision was based on public interest concerns regarding valuation, the lack of regulation, and investor protection issues. In setting aside the earlier decision the OSC Commissioner, Lawrence P. Haber noted that Staff “… has not demonstrated that: bitcoin is an illiquid asset such that the Fund will not be compliant with the restrictions on illiquid assets in NI 81-102.” Haber also overturned the public interest case regarding Staff’s concerns on the integrity of the bitcoin markets, and the Fund’s ability to value and safeguard the bitcoin it holds and file audited financial statements. Before granting the receipt to the final prospectus, Haber imposed several conditions on the Manager and Fund. These included: - insurance for Bitcoin stored in hot wallets; and, - a compromise regarding the methodology and composition of the Fund’s valuation index. *Reasons and Decisions in the Matter of 3iQ and the Bitcoin Fund* [is available for download](https://www.osc.gov.on.ca/documents/en/Proceedings-RAD/rad_20191029_3iq-2.pdf) from the website of the Ontario Securities Commission. 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. **Categories:** News & Updates --- ### [Ontario Securities Commission Greenlights Limited-Time Pilot of Security Token](https://baxsecuritieslaw.com/ontario-securities-commission-greenlights-limited-time-pilot-of-security-token/) **Published:** November 4, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission has granted limited-time approval to TokenGX Inc. (TokenGX or the Company) for the creation of a blockchain-based security token (token). TokenGX sought approval to create its blockchain-based security token trading platform (the Platform) through the OSC’s Launch Pad. The Company is... **Content:** The Ontario Securities Commission has granted limited-time approval to TokenGX Inc. (TokenGX or the Company) for the creation of a blockchain-based security token (token). TokenGX sought approval to create its blockchain-based security token trading platform (the Platform) through the OSC’s Launch Pad. The Company is an affiliate of TokenFunder Inc. which had been [granted regulatory relief](https://lawfirmbarbara.wpengine.com/osc-grants-approval-first-initial-coin-offering/) for an ICO (Initial Coin Offering), also referred to as an Initial Token Offering (ITO), in October 2017. TokenGX’s Platform would facilitate the trading among investors of their tokens that were distributed under prospectus exemptions to facilitate capital raising for issuers and to provide liquidity for the investors. The Company has already completed its capital raise through an ITO (Initial Token Offering) under the offering memorandum prospectus exemption (the OM Exemption) in section 2.9 of *National Instrument 45-106 Prospectus Requirements* (NI 45-106), and is registered as an Exempt Market Dealer (EMD) to operate the Platform in British Columbia, Alberta, Ontario, and Québec. Regulatory relief was granted for the pilot test period by the OSC under the applicable securities legislation: - section 15.1 of National Instrument 21-101 Marketplace Operation (NI 21-101) for relief in whole from the requirements of NI 21-101; - section 12.1 of National Instrument 23-101 Trading Rules (NI 23-101) for relief in whole from the requirements of NI 23-101; - section 10 of National Instrument 23-103 Electronic Trading and Direct Access to Marketplaces (NI 23-103) for relief in whole from the requirements of NI 23-103; and, - section 74 of the Securities Act (Ontario) (the Act) for relief from the prospectus requirement in section 53 of the Act (the Prospectus Relief). The Decision will expire the earlier of twelve months after the closing of the first completed ITO of an issuer on the Primary Distribution Platform and April 16, 2021. OSC staff caution that it should not be viewed as forming a precedent. The Decision, In the Matter of The Securities Legislation of Ontario and in the Matter of TokenGX Inc. (The Filer) [is available for download](https://www.osc.gov.on.ca/documents/en/ord_20191023_tokengx.pdf) from the website of the Ontario Securities Commission. 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. **Categories:** News & Updates --- ### [BCSC Acts Against Two British Columbia Cryptocurrency Exchanges](https://baxsecuritieslaw.com/bcsc-acts-against-two-british-columbia-cryptocurrency-exchanges/) **Published:** November 5, 2019 **Author:** Barbara Hendrickson **Excerpt:** The British Columbia Securities Commission (BCSC) has acted to protect the investors of one BC-based cryptocurrency exchange while launching an investigation against a second. On October 31, 2019 the counsel representing the Vancouver-based Einstein Exchange (Einstein) had informed the BCSC that its client had planned... **Content:** The British Columbia Securities Commission (BCSC) has acted to protect the investors of one BC-based cryptocurrency exchange while launching an investigation against a second. On October 31, 2019 the counsel representing the Vancouver-based Einstein Exchange (Einstein) had informed the BCSC that its client had planned to shut down within 30 to 60 days due to “a lack of profitability.” The company’s website subsequently went off-line. On November 1, 2019 the regulator, acting on complaints from investors alleging they had not been able to withdraw their funds from Einstein, applied to the Supreme Court of British Columbia for an order appointing an interim receiver to preserve and protect the company’s assets. The Court granted the application and appointed Grant Thornton Limited as interim receiver. Grant Thornton entered and secured Einstein’s premises, later that same day. According to an [affidavit posted on Grant Thornton’s](https://docs.grantthornton.ca/document-folder/viewer/docul8LWsxcWho7J/298293881135748939) website, a BCSC investigator’s analysis showed Einstein owed its investors roughly $16.3 million CAD in cryptocurrencies and fiat currency. The same document also raised concerns regarding potential money laundering. In a separate action on November 4, the BCSC launched an investigation of Nanaimo-based ezBtc.ca (ezBtc), after investors alleged they were unable to access their funds after the company’s website went dark in late October. Media reports place potential losses in the millions of dollars. The regulator has advised those with funds invested in Einstein Exchange to contact the receiver, Grant Thornton. It has also advised investors in ezBtc to consult a lawyer to consider their options regarding returning their money. BCSC staff warn they have not authorized any crypto asset trading platforms to operate as an exchange in the province. They urge investors to exercise caution when buying or selling any crypto-assets due to various risks, including the loss of some or all of their investment. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Issue CSA Staff Notice 51-357, Staff Review of Reporting Issuers in the Cannabis Industry](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-csa-staff-notice-51-357-staff-review-of-reporting-issuers-in-the-cannabis-industry-2/) **Published:** November 12, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has completed its review of the disclosure of 70 Canadian Cannabis industry registrants, CSA Staff Notice 51-357, Staff Review of Reporting Issuers in the Cannabis Industry (the Staff Notice). Prior to the Cannabis Act, 2018 (the Act), which permits the... **Content:** The Canadian Securities Administrators (CSA) has completed its review of the disclosure of 70 Canadian Cannabis industry registrants, CSA Staff Notice 51-357, Staff Review of Reporting Issuers in the Cannabis Industry (the Staff Notice). Prior to the Cannabis Act, 2018 (the Act), which permits the recreational sale, production, and use of cannabis, only licensed cannabis producers (LPs) approved by Health Canada to grow medical cannabis were permitted. Since the Act came into force, the number of licensed producers has grown to 253 LPs, which includes both medicinal and recreational growers. As the cannabis market grew, many issuers and their directors and executive officers participated in the financing of other cannabis issuers, resulting in a higher than usual crossover of financial interests. These interests may include overlapping debt and equity, or other business relationships. As a result of these concerns, the CSA has undertaken a survey of the reporting issuers in the cannabis industry and published the resultant Staff Notice to identify best practices so that investors are provided with transparent information about financial performance and to support informed investing decisions. The Staff Notice identified key deficiencies in the disclosure of the 70 LPs it reviewed: • 100% of the 70 LPs the CSA reviewed needed to improve their fair value and fair value-related disclosures. LPs often did not provide sufficient information in their financial statements and management’s discussion and analysis (MD&A) for an investor to understand their financial performance. International Financial Reporting Standards (IFRS) require issuers to record growing cannabis plants at their fair value; • The CSA found that some of the issuers it surveyed did not consistently comply with securities requirements for forward-looking information, guidance for providing balanced disclosure and certain other requirements; and, • 74% of issuers with cannabis operations in the U.S. that the regulator reviewed did not provide sufficient disclosure about the risks related to their U.S. operations to satisfy the disclosure expectations set out in CSA Staff Notice 51-352 (Revised) Issuers with U.S. Marijuana-Related Activities(the U.S. Disclosure Expectations Notice). CSA Staff advise that they will be monitoring the situation closely on a going-forward basis and warn that issuers who do not meet expectations regarding disclosure will face additional regulatory action. CSA Staff Notice 51-357, Staff Review of Reporting Issuers in the Cannabis Industry is [available for download](https://www.osc.gov.on.ca/documents/en/Securities-Category5/csa_20181010_51-357_staff-review-reporting-issuers-cannabis-industry.pdf) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Sign Fintech Cooperation Agreement with Monetary Authority of Singapore](https://baxsecuritieslaw.com/canadian-securities-administrators-sign-fintech-cooperation-agreement-with-monetary-authority-of-singapore/) **Published:** November 19, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) and the participating jurisdictions of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, and Nova Scotia (the Participating Jurisdictions) have signed a cooperation agreement (the Agreement) with the Monetary Authority of Singapore (MAS), which is Singapore’s central bank and... **Content:** The Canadian Securities Administrators (CSA) and the participating jurisdictions of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, and Nova Scotia (the Participating Jurisdictions) have signed a cooperation agreement (the Agreement) with the Monetary Authority of Singapore (MAS), which is Singapore’s central bank and financial regulator. The Agreement extends the work of the CSA Regulatory Sandbox Initiative and that of the MAS Fintech and Innovation Group. Notably, it includes a referral mechanism for businesses and will enhance the information-sharing between the CSA and MAS. It will allow businesses from each country access to the other’s regulated markets. In the past, the CSA and MAS have cooperated on a project to explore cross-border payments transactions on blockchain. The Agreement will come into force in certain Participating Jurisdictions once governmental approval is received. The complete text of the Agreement can be found on the [websites of the participating jurisdictions.](https://lautorite.qc.ca/fileadmin/lautorite/grand_public/salle-de-presse/communiques/2019/Monetary-Authority-of-Singapore-Cooperation-Agreement-2019-10-18.pdf) 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. **Categories:** News & Updates --- ### [Ontario Securities Commission Publishes 2019 Burden Reduction Update](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-2019-burden-reduction-update/) **Published:** November 19, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has published a year-end update on its burden reduction efforts for Ontario capital market participants, Reducing Regulatory Burden in Ontario’s Capital Markets, 2019 (the Update). In OSC Staff Notice 11-784, Burden Reduction (the Staff Notice), published in January 2019 and... **Content:** The Ontario Securities Commission (OSC) has published a year-end update on its burden reduction efforts for Ontario capital market participants, *Reducing Regulatory Burden in Ontario’s Capital Markets, 2019* (the Update). In [*OSC Staff Notice 11-784, Burden Reduction*](https://www.osc.gov.on.ca/en/SecuritiesLaw_sn_20190114_11-784_burden-reduction.htm) (the Staff Notice), published in January 2019 and which began the process, OSC Staff asked for comments from stakeholders. In the subsequent Update, Staff noted that in response they received 69 comment letters and 199 suggestions for improvement. The regulator then grouped this feedback into 38 underlying concerns, of which the regulatory burden reductions (the burden reductions) will address 34. OSC Staff expects that the burden reductions will assist capital market participants by generally minimizing regulatory delays and reducing the cost of capital. Overall, these steps include: greater transparency surrounding the OSC’s processes with clearer communication from staff, greater clarity and flexibility surrounding the fulfillment of regulatory requirements, less duplication of requirements and form filings and more manageable timelines for certain filings, along with rules and guidance that are easier to understand easier to find on the regulator’s website. One of the main commitments coming from the OSC in the Update was the development of a regulatory approach that was geared to the size and type of market participant. For example, the regulator expects small and medium-sized companies and registrants will benefit from: - expanded and improved service standards, particularly in respect of compliance reviews; - greater support for companies seeking public financing, through a confidential prospectus review process before announcing an IPO or other financing; - for small registrants, being able, in appropriate circumstances, to hire a Chief Compliance Officer (CCO) who acts in that role for other, unaffiliated registrant firms; and, OSC staff believes that innovative businesses and startups will benefit from: - greater flexibility for new business models from OSC Staff in the registration process, resales in the secondary market, who can invest (e.g. individuals with specialized knowledge), and other regulatory requirements; - for individuals applying to be a CCO, assessments of their qualifications and experience that consider their broader business experience and its alignment with the firm’s business model; and, - harmonization of the crowdfunding rules across participating CSA (Canadian Securities Administrators) jurisdictions, for startups seeking financing. Similarly, the regulator also believes that large businesses and market participants will benefit from: - reduced instances of duplicative filing requirements for investment fund managers due to investment funds and registration rules; - proposals to codify routine exemptive relief for investment funds; - measures to facilitate registration of multiple CCOs for large registrants with multiple business divisions; - a process for registering of Advising and Associate Advising Representatives as Client Relationship Managers; and, - the ability for public companies to conduct at-the-market offerings without having to obtain prior exemptive relief. The regulator expects that most of the burden reductions can be achieved within the next year, however, it notes some changes involving legislative amendments or harmonization with other regulators may take longer. *Reducing Regulatory Burden in Ontario’s Capital Markets, 2019* [is available for download](https://www.osc.gov.on.ca/en/59153.htm)from the website of the Ontario Securities Commission. 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. **Categories:** News & Updates --- ### [FINTRAC Updates Methods Used Identifying Individuals and Confirming the Existence of Corporations or Other Entities](https://baxsecuritieslaw.com/fintrac-updates-methods-used-identifying-individuals-and-confirming-the-existence-of-corporations-or-other-entities/) **Published:** December 5, 2019 **Author:** Barbara Hendrickson **Excerpt:** Canada’s financial watchdog, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), has published updated requirements for the identification of certain individuals or corporations or entities, Methods to Verify the Identity of an Individual and Confirm the Existence of a Corporation or an Entity... **Content:** Canada’s financial watchdog, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), has published updated requirements for the identification of certain individuals or corporations or entities, *Methods to Verify the Identity of an Individual and Confirm the Existence of a Corporation or an Entity other than a Corporation* (the Updated Requirements). The Updated Requirements for the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations (PCMLTFR) stipulate how and when reporting issuers and promoters must identify an individual or confirm the existence of a corporation or of an entity other than a corporation. Individuals can be identified in one of three ways: - Government-issued photo identification method where the document must be: - authentic, valid and current (this must indicate the individual’s name, have a photo of the individual, have a unique identifying number, and match the name and appearance of the individual in question) ; - Credit file method where the information must: - be valid (from a Canadian credit bureau) and current (have the name and address that matches that of the individual in question, and be three years or less old); or - Dual-process method where the information must be: - valid and current, and two different and reliable sources (information must include the individual’s name, address, date of birth, and confirm the individual in question has a deposit account, credit card, or other loan accounts with a financial entity. Corporations can be identified by: - a certificate of incorporation; - a certificate of active corporate status; - a record that has to be filed annually under provincial securities legislation; or, - any other record that confirms the corporation’s existence, such as the corporation’s published annual report signed by an audit firm, or a letter or notice of assessment for the corporation from a municipal, provincial, territorial or federal government. Entities other than corporations can be identified by: - a partnership agreement; - articles of association; or - any other record that confirms its existence as a legal entity (for example, a trust agreement). FINTRAC staff note that when conducting due diligence regarding the identity of corporations or entities, reporting issuers and promoters must keep a record of: - the corporation’s or the entity’s registration number; and, - the type of record consulted: - if a paper record is used, a copy of it must be kept; or, - if an electronic record, the source of the version of the record. The complete *Methods to Verify the Identity of an Individual and Confirm the Existence of a Corporation or an Entity other than a Corporation* [can be found on the website of](https://www.fintrac-canafe.gc.ca/guidance-directives/client-clientele/Guide11/11-eng) the Financial Transactions and Reports Analysis Centre of Canada. 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. **Categories:** News & Updates --- ### [Financial Services Regulatory Authority of Ontario Provides Update for Burden Reduction of Syndicated Mortgage Investments](https://baxsecuritieslaw.com/financial-services-regulatory-authority-of-ontario-provides-update-for-burden-reduction-of-syndicated-mortgage-investments/) **Published:** December 16, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Financial Services Regulatory Authority of Ontario (FSRA) has provided an update for its intentions to provide burden reduction for syndicated mortgage investments. While earlier introducing a new supervisory approach to higher-risk syndicated mortgages marketed to retail investors, the regulator is now introducing amended disclosure... **Content:** The Financial Services Regulatory Authority of Ontario (FSRA) has provided an update for its intentions to provide burden reduction for syndicated mortgage investments. While earlier introducing [a new supervisory approach](https://lawfirmbarbara.wpengine.com/fsra-issues-request-for-comment-on-proposed-supervision-approach-to-high-risk-syndicated-mortgages-and-publishes-new-fee-rule-for-non-qualified-syndicated-mortgages/) to higher-risk syndicated mortgages marketed to retail investors, the regulator is now introducing amended disclosure forms for non-qualified syndicated mortgages, aimed at reducing the regulatory burden when mortgage brokerages are working with more sophisticated investors, who are generally more knowledgeable and experienced with complex investments. FSRA staff note that the amended forms do not reduce the amount of disclosure or the obligations of mortgage brokerages that are dealing with retail investors who may be less sophisticated in their investment knowledge. FSRA will periodically conduct reviews to assess compliance with requirements related to these investors and will take regulatory action where appropriate. FSRA staff also note that mortgage brokerages must make investors and the regulator aware of syndicated mortgages that bear the characteristics associated with a high-risk transaction. The [complete text of the announcement](https://www.fsrao.ca/newsroom/update-burden-reduction-syndicated-mortgage-investments) can be found on the website of the Financial Services Regulatory Authority of Ontario. 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. **Categories:** News & Updates --- ### [Ontario Securities Commission and Financial Services Regulatory Authority of Ontario Provide Update of Transfer of Syndicated Mortgage Investments](https://baxsecuritieslaw.com/ontario-securities-commission-and-financial-services-regulatory-authority-of-ontario-provide-update-of-transfer-of-syndicated-mortgage-investments/) **Published:** December 16, 2019 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) and the Financial Services Regulatory Authority of Ontario (FSRA) have updated the timeline for the handover of responsibility of oversight of syndicated mortgage investments from FSRA to the OSC. The handover which was to occur at the start of 2020... **Content:** The Ontario Securities Commission (OSC) and the Financial Services Regulatory Authority of Ontario (FSRA) have updated the timeline for the handover of responsibility of oversight of syndicated mortgage investments from FSRA to the OSC. The handover which was to occur at the start of 2020 is now expected to effective July 2020, subject to approvals. Both regulators will provide further details on a going-forward basis.The intention to transfer syndicated mortgages to the OSC’s jurisdiction was first announced in the April, 2017 provincial budget. The [complete text of the announcement](https://www.osc.gov.on.ca/en/NewsEvents_nr_20191211_fsra-osc-provide-update-syndicated-mortgage-investments.htm) can be found on the website of the Ontario Securities Commission. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish CSA Staff Notice 81-332, Next Steps on Proposals to Prohibit Certain Investment Fund Embedded Commissions](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-csa-staff-notice-81-332-next-steps-on-proposals-to-prohibit-certain-investment-fund-embedded-commissions/) **Published:** December 20, 2019 **Author:** Barbara Hendrickson **Excerpt:** [et_pb_section admin_label="section"] [et_pb_row admin_label="row"] [et_pb_column type="4_4"][et_pb_text admin_label="Text"] The Canadian Securities Administrators (CSA) has published CSA Staff Notice 81-332, Next Steps on Proposals to Prohibit Certain Investment Fund Embedded Commissions (the Staff Notice). The document details the regulator’s ongoing plan to prohibit certain classes of embedded... **Content:** [et_pb_section admin_label=”section”] [et_pb_row admin_label=”row”] [et_pb_column type=”4_4″][et_pb_text admin_label=”Text”] The Canadian Securities Administrators (CSA) has published *CSA Staff Notice 81-332, Next Steps on Proposals to Prohibit Certain Investment Fund Embedded Commissions* (the Staff Notice). The document details the regulator’s ongoing plan to prohibit certain classes of embedded investment fund commissions. After a period of consultation in 2018 and analysis of stakeholder feedback, CSA Staff has proposed the final amendments (the final amendments) to National Instrument 81-105 *Mutual Fund Sales Practices* (NI-81-105): - Implementation of enhanced conflict of interest mitigation rules and guidance for dealers and representatives requiring that all existing and reasonably foreseeable conflicts of interest, including conflicts arising from the payment of embedded commissions, be addressed in the best interests of clients or avoided; - Prohibition of all forms the payment of upfront sales commissions by fund organizations to dealers, and in so doing, discontinue sales charge options that involve such payments such as all forms of the deferred sales charge option, including low-load options (collectively, the DSC option), in respect of the purchase of securities of a prospectus qualified mutual fund; and - Prohibition the payment of trailing commissions to, and the solicitation and acceptance of trailing commissions by, dealers who do not make a suitability determination in connection with the distribution of securities of a prospectus qualified mutual fund, such as order-execution-only (OEO) commission payments. The securities regulatory authorities of the participating jurisdictions of British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, New Brunswick, Nova Scotia, Newfoundland and Labrador, Nunavut, Northwest Territories, and the Yukon (the Participating Jurisdictions) are expected to publish the final amendments to ban the DSC option in early 2020. The Ontario Securities Commission (OSC) has declined to participate in the adoption of the final amendments to ban the DSC option. In the jurisdictions where the final amendments are expected to come into force, there will be a transition period of at least two years. On the effective date of the DSC ban, new sales using the DSC option will not be permitted in the Participating Jurisdictions. Any DSC redemption schedules for sales made before the effective date of the DSC ban will be allowed to run their course in the Participating Jurisdictions. The Participating Jurisdictions will provide more information when the final amendments are published, including any transitional provisions that may be required to allow the continued use of the DSC option after the Client Focused Reforms enhanced conflicts of interest requirements come into effect. All CSA member jurisdictions are expected to implement the ban on payments of trailing commissions to dealers who do not make a suitability determination. CSA Staff anticipates at minimum, a two-year transition period for the ban to take effect, along with additional adjustments in response to stakeholder feedback. *CSA Staff Notice 81-332, Next Steps on Proposals to Prohibit Certain Investment Fund Embedded Commissions* [is available for download](https://www.bcsc.bc.ca/81-332_%5bCSA_Staff_Notice%5d_12192019/) from the websites of the Participating Jurisdictions. 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. [/et_pb_text][/et_pb_column] [/et_pb_row] [/et_pb_section] [previousOntario Securities Commission and Financial Services Regulatory Authority of Ontario Provide Update of Transfer of Syndicated Mortgage Investments](https://baxsecuritieslaw.com/ontario-securities-commission-and-financial-services-regulatory-authority-of-ontario-provide-update-of-transfer-of-syndicated-mortgage-investments/) [nextBAX Securities Law Welcomes Neil Mangan as New Associate Lawyer](https://baxsecuritieslaw.com/bax-securities-law-welcomes-neil-mangan-as-new-associate-lawyer/) ### About BAX Securities Law® Corporate Securities & Financial Services Lawyers BAX Securities Law® practises in the securities and financial services regulatory areas and has acted as counsel to major Canadian and American corporations, market participants. #### Legal Services If you wish to discuss retaining BAX Securities Law® to provide you with legal services, please contact: **Barbara Hendrickson** Managing Partner **416.601.1004** [*bhendrickson@baxsecuritieslaw.com*](mailto:bhendrickson@baxsecuritieslaw.com) [Get In Touch](https://baxsecuritieslaw.com/consult/) **Categories:** News & Updates --- ### [BAX Securities Law Welcomes Neil Mangan as New Associate Lawyer](https://baxsecuritieslaw.com/bax-securities-law-welcomes-neil-mangan-as-new-associate-lawyer/) **Published:** January 2, 2020 **Author:** Barbara Hendrickson **Excerpt:** Press Release Toronto ON - January 1, 2020 - Barbara Hendrickson, Managing Partner and Founder of BAX Securities Law welcomed securities lawyer Neil Mangan to the company’s team of legal professionals. “We are proud to have Mr. Mangan practice in association with BAX Securities Law,”... **Content:** **Press Release** Toronto ON – January 1, 2020 – Barbara Hendrickson, Managing Partner and Founder of BAX Securities Law welcomed securities lawyer [**Neil Mangan**](https://lawfirmbarbara.wpengine.com/neil-mangan/) to the company’s team of legal professionals. “We are proud to have Mr. Mangan practice in association with BAX Securities Law,” said Hendrickson. “In addition to his broad business law background, Neil brings a wealth of experience in real estate development and technology matters to his securities practice. Neil also appreciates the needs and challenges facing businesses operating in complex regulatory environments, having worked previously as Vice President of an accredited private college and legal associate in a software company providing communications compliance services for FINRA regulated broker-dealers, hedge funds and financial institutions.” Before moving to Toronto, Mr. Mangan led a successful real estate development, condominium, and business law practice in Vancouver. There he worked with developers and entrepreneurs to help structure, fund, and finance their projects. Mr. Mangan is experienced in corporate mergers and acquisitions and capital raising through corporations, limited partnerships, and real estate syndications. Mr. Mangan has previously co-authored the *Annotated British Columbia Society Act*and taught Land Law as an Adjunct Professor at the University of British Columbia’s Sauder School of Business. He has published articles for a variety of trade publications and is a member of the Law Society of British Columbia and Law Society of Ontario. “Mr. Mangan’s experience and background will complement the suite of professional services that BAX offers,” said Hendrickson. “We look forward to a long and productive association with him.” For more information, please call Neil Mangan at (416) 551-2616 or Barbara Hendrickson at (416) 601 -1004 at BAX Securities Law. 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. **Categories:** News & Updates --- ### [Bank of England Governor Mark Carney to Become United Nations Special Envoy on Climate Action and Finance](https://baxsecuritieslaw.com/bank-of-england-governor-mark-carney-to-become-united-nations-special-envoy-on-climate-action-and-finance/) **Published:** January 2, 2020 **Author:** Barbara Hendrickson **Excerpt:** Mark Carney, OC, Governor of the Bank of England and former Governor of the Bank of Canada, has been appointed by United Nations Secretary-General António Guterres to serve as UN Special Envoy on Climate Action and Finance. Carney’s appointment a UN Special Envoy will commence... **Content:** Mark Carney, OC, Governor of the Bank of England and former Governor of the Bank of Canada, has been appointed by United Nations Secretary-General António Guterres to serve as UN Special Envoy on Climate Action and Finance. Carney’s appointment a UN Special Envoy will commence when his term as Governor of the Bank of England ends in March 2020. Carney’s previous roles include positions with Goldman Sachs, the Canadian Department of Finance, and from 2011 to 2018, Chairman of the Financial Stability Board, which is an international body that monitors and makes recommendations for the world financial system. As UN Special Envoy, Carney’s role will be to focus on the implementation of climate action plans, with special attention to significantly shifting public and private finance markets and mobilizing private finance to the levels needed to achieve the 1.5°C goal of the Paris Agreement. This includes building the frameworks for financial reporting, risk management, and returns in order to bring the impacts of climate change to the mainstream of private financial decision making and to support the transition to a net-zero carbon economy. In an interview recently broadcast on the CBC, Carney compared the climate crisis to a financial crisis, stating that action was “absolutely necessary.” Carney also noted that while thousands of companies around the world have started to make their climate change disclosures public, he said the transition to full disclosure is not happening fast enough. 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. **Categories:** News & Updates --- ### [What is an Unlimited Liability Corporation (ULC)?](https://baxsecuritieslaw.com/what-is-an-unlimited-liability-corporation-ulc/) **Published:** January 7, 2020 **Author:** Ray Luckiram **Excerpt:** Co-Authored by: Artem Kobzev * This article only deals with US corporations and is not applicable to US individuals An unlimited liability corporation (“ULC”) is a unique corporate structure in which shareholders may incur personal liability for debts and liabilities of the corporation. While this... **Content:** **C*o-Authored by:*** Artem Kobzev *\* This article only deals with US corporations and is not applicable to US individuals* An unlimited liability corporation (“ULC”) is a unique corporate structure in which shareholders may incur personal liability for debts and liabilities of the corporation. While this may seem counterintuitive to the normal purpose of incorporation, ULCs are often employed by US businesses as an investment vehicle to the Canadian market due to preferential tax treatment. Specifically, since US tax authorities treat ULCs as “flow through” entities, this allows income and loses to be passed on to the parent company. **What is an Unlimited Liability Corporation (ULC)?** A ULC is a distinct form of corporation available by statute in Alberta, British Columbia and Nova Scotia. The word “unlimited” implies that liability is not limited to assets of the corporation and shareholders personal assets may also be seized to pay debts incurred by the ULC. In British Columbia and Nova Scotia, on dissolution of the ULC, the shareholders and potentially previous shareholders may be liable for obligations of the ULC. In Alberta, dissolution is not required for shareholders to be liable. In general, former shareholders of less than one year may also be liable as well. **Canadian Subsidiaries and Branches** When a US company decides to expand to Canada, it must choose between opening a branch or subsidiary. A branch simply means the US company begins operations in Canada, with the US company subject to Canadian tax obligations. Whereas a subsidiary is the formation of a separate corporate entity in a Canadian jurisdiction. Active business income earned by non-residents is taxable at the rates applicable to Canadian residents under Part I of the *Income Tax Act* (Canada) (the “Tax Act”). If a US company carries on business in Canada through a branch, in addition to Part I tax on the business profit, the Tax Act imposes an additional 25% “branch tax”, designed to prevent foreign corporations from avoiding Canadian withholding tax on dividends by carrying on business through a branch as opposed to a corporation. Activities that do not constitute carrying on business in Canada are taxable under Part XIII of the Tax Act. Part XIII tax is a withholding tax that applies to non-resident taxpayers who receive payments of interest, rent, royalty or dividends from Canadian residents. The Part XIII withholding rate is 25%, subject to a reduction in accordance with the *Canada-US Tax Convention* (the “Tax Treaty”). To avoid certain measures of the withholding tax regulations, US businesses often form a Canadian corporate subsidiary as the Canadian entity would be a resident of Canada. Further, only the Canadian subsidiary would be responsible for Canadian tax obligations, such as filing an income tax return and comping with provincial sales tax regulations. In essence, a Canadian corporate subsidiary of a US company will be subject to Part I tax and would pay Canadian taxes associated with its earning in Canada. With respect to distributions, and subject to anti-deferral provisions that apply to controlled foreign affiliates, a US shareholder of a Canadian corporate subsidiary is generally not taxed on the corporate earnings until the earnings are distributed. Once distributed, the US shareholder pays US tax on the dividend received. **Provincial Residency Requirements for Directors** In the provinces of Ontario, Alberta, Newfoundland, New Brunswick and Saskatchewan the majority of a corporation’s directors must be Canadian. In British Columbia, Quebec, New Brunswick, Nova Scotia, Prince Edward Island, Yukon, Northwest Territories the residency requirements vary, but the majority od directors do not need to be Canadian. In particular, in British Columbia, there is no Canadian residency requirement for any directors and ULCs are available. In Ontario, there have been discussions on changing the residency requirements of directors. **Tax Considerations** For Canadian income tax purposes, ULCs are treated as ordinary corporations. As such, income resulting from interest, dividends, royalties, and other payments from a Canadian ULC to a foreign shareholder may still be subject to a 25 percent Part XIII withholding tax described earlier. Until recently, the Tax Treaty reduced the 25% withholding rate on payment from Canadian ULCs to 5% with the rationale being that for the purposes of US tax law, a ULC is a disregarded entity (not viewed as a separate legal entity from its owner). Due to the implementation of recent hybrid rules, the 5% withholding rate can only be obtained for dividend payments and only if certain steps are followed and certain conditions are met. **US Citizens in Canada Going back to the anti-deferral provisions that apply to controlled foreign affiliates, US anti-deferral regimes create so called phantom income. The passive foreign income corporation (“PFIC”) is one example of such regimes. For US tax purposes, a corporation will be considered a PFIC if: 1. at least 75% of the corporation’s gross income is passive in nature, or; 2. at least 50% of the corporation’s assets are investments which produce income in the form of earned interest, dividends or capital gains. As a result of these rules, if a corporation is found to be a PFIC, its income may be treated as ordinary income for US tax purposes. These rates can be significantly higher than Canadian tax rates for certain types of income (capital gains or dividends) and any tax owing may subject to an interest charge. One strategy that have been used by many cross-border practitioners is to convert a PFIC into a ULC. For more information, please call Barbara Hendrickson at BAX Securities Law (416) 601 -1004 or Ray Luckiram at (416) 601-0591. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish Consultation Paper 51-405 Consideration of an Access Equals Delivery Model for Non-Investment Fund Reporting Issuers](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-consultation-paper-51-405-consideration-of-an-access-equals-delivery-model-for-non-investment-fund-reporting-issuers/) **Published:** January 17, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published CSA Consultation Paper 51-405 Consideration of an Access Equals Delivery Model for Non-Investment Fund Reporting Issuers (the Consultation Paper). The Consultation Paper seeks opinion from stakeholders regarding the appropriateness of introducing an “access equals delivery model” (the Proposed... **Content:** The Canadian Securities Administrators (CSA) has published *CSA Consultation Paper 51-405 Consideration of an Access Equals Delivery Model for Non-Investment Fund Reporting Issuers* (the Consultation Paper). The Consultation Paper seeks opinion from stakeholders regarding the appropriateness of introducing an “access equals delivery model” (the Proposed New Model) into the Canadian market. Stakeholder have until March 9, 2020, to submit their opinions in writing. Under the Proposed New Model, the delivery of a document would be impacted by issuers alerting investors that the document is publicly available on the System for Electronic Document Analysis and Retrieval (SEDAR) and on the company’s website. The goal, according to CSA staff, is to improve electronic access to documents, without compromising investor protections. The Consultation Paper provides an overview of current delivery requirements under securities legislation and describes the Proposed New Model. It also discusses similar models that have been implemented in other jurisdictions. The regulator is seeking comment on the scope and mechanics of access equals delivery, including the types of documents that would be included in the model. *CSA Consultation Paper 51-405 Consideration of an Access Equals Delivery Model for Non-Investment Fund Reporting Issuers* [is available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_irps_index.htm) from the websites of the Participating Jurisdictions. 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. **Categories:** News & Updates --- ### [Has Sustainable Investing Finally Hit Its Stride?](https://baxsecuritieslaw.com/has-sustainable-investing-finally-hit-its-stride/) **Published:** January 21, 2020 **Author:** Barbara Hendrickson **Excerpt:** With recent news breaking that Barron’s fourth-annual ranking of big-cap equity funds receiving a “high” or “above average” sustainability rating from Morningstar substantially outperforming those with lower sustainability ratings, you might be forgiven to think sustainable investing has finally hit its stride. And it might... **Content:** With recent news breaking that *Barron’s* fourth-annual ranking of big-cap equity funds receiving [a “high” or “above average” sustainability](https://www.barrons.com/articles/top-esg-funds-our-annual-ranking-finds-sustainable-funds-are-increasingly-beating-the-market-51579301101) rating from Morningstar substantially outperforming those with lower sustainability ratings, you might be forgiven to think sustainable investing has finally hit its stride. And it might well have, if the recent letter from Larry Fink, chairman of institutional investor Black Rock Inc., warning against the mounting dangers of climate change, is any indication. In the same letter, Fink announced Black Rock was going heavily into sustainable investing, noting the firm’s actively-managed funds were in the process of divesting stocks or bonds of companies that generate more than 25% of their income from thermal coal production. He also noted that companies with high Environmental, Social and Governance (ESG) risks, such as coal companies should be excluded from ESG-driven benchmarks. Fink said he would double Black Rock’s exposure to 150 ESG exchange-traded funds (ETFs) over the next few years and will offer ETFs that will exclude fossil-fuel producers. He said he would work with index providers to expand their ESG offerings. Ultimately, Fink noted that a transition to a carbon-free economy would take place over the course of decades. During that time, Black Rock would continue to hold an exposure to hydrocarbon assets. Black Rock’s move might mean further bad news for already pummelled coal stocks. In response to the announcement by Black Rock, which has almost USD 7 trillion assets under management, Moody’s Investor Service warned that coal companies would have to “express more financial conservatism in 2020.” 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish Staff Notice 21-327 Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-staff-notice-21-327-guidance-on-the-application-of-securities-legislation-to-entities-facilitating-the-trading-of-crypto-assets/) **Published:** January 21, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) published CSA Staff Notice 21-327 Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets (the Staff Notice) on January 18, 2020. The objective of the Staff Notice is to clarify where securities legislation may... **Content:** The Canadian Securities Administrators (CSA) published *CSA Staff Notice 21-327 Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets* (the Staff Notice) on January 18, 2020. The objective of the Staff Notice is to clarify where securities legislation may apply to certain crypto asset transactions facilitated by entities (collectively Platforms), including the buying and selling of crypto assets. Any Platform which trades crypto assets that are “securities” or “derivatives” will be subject to securities legislation. The Staff Notice has its roots in the Joint CSA/IIROC Consultation Paper 21-402 of March 2019 (the Consultation Paper), which stated if crypto assets that are securities or derivatives are traded on a Platform, such Platform would be subject to securities legislation. A crypto asset may be considered a “security” where it falls under the definition of a “security” including any document “commonly known as a security.” One example, is where a crypto asset carries rights traditionally attached to common shares such as voting rights and rights to receive dividends. A crypto asset may be characterized as a “derivative” where it provides an option to acquire an asset in the future including a crypto asset that is a “commodity.” The user’s contractual right to the crypto asset may itself constitute a derivative. In some jurisdictions, a crypto asset that is a “derivative” may also be considered a “security” where it falls under the definition of a “security” including as an “investment contract” or an “evidence of indebtedness” or an “evidence of title to or interest” in the assets or property of another person. Platforms will not be subject to securities legislation where they only allow for transactions involving crypto assets that are not, in and of themselves, derivatives or securities. A Platform would not generally be subject to securities legislation if each of the following apply: - the underlying crypto asset itself is not a security or derivative; and, - the contract or instrument for the purchase, sale, or delivery of a crypto asset: - results in an obligation to make immediate delivery of the crypto asset, and - is settled by the immediate delivery of the crypto asset to the Platform’s user according to the Platform’s typical commercial practice. The Staff Notice states that while there is no “bright-line” test to determine whether a contract or instrument results in an obligation, the transaction will generally be subject to securities legislation if the transaction does not result in an obligation to make and take delivery of the crypto asset immediately following the transaction. The CSA will consider the terms of contracts regarding the terms between the Platform and the user, including whether the contract or instrument creates an obligation to make immediate delivery of the crypto asset. As part of this analysis, the CSA will consider whether the Platform and the user intend, at the time the contract or instrument is entered into, to make and take delivery of the crypto asset on which the contract or instrument is based. Generally, an obligation to immediate delivery of a crypto asset occurs where: - the contract creates an obligation on the Platform to immediately transfers ownership, possession, and control of the crypto asset to the Platform’s user, and, as a result, the user is free to use, or otherwise deal with, the crypto asset without: - further involvement with, or reliance on the Platform or its affiliates, and - the Platform or any affiliate retaining any security interest or any other legal right to the crypto asset; and, - following the immediate delivery of the crypto asset, the Platform’s user is not exposed to insolvency risk (credit risk), fraud risk, performance risk or proficiency risk on the part of the Platform. The Staff Notice provides further clarification on certain Platforms that provide users with an opportunity to transact in crypto assets, including an opportunity to buy and sell crypto assets while retaining ownership, control, and possession of crypto assets. These Platforms only transfers ownership, control and possession from the Platform’s address to the user-controlled address (usually a wallet for crypto asset storage) upon the user’s request. Until the user makes their request, there is no obligation on the Platform’s part for delivery of ownership and possession of the crypto asset. This kind of a transaction may be subject to securities legislation if: - the contract or instrument does not create an obligation to make immediate delivery of the crypto assets to the user; and, - the typical commercial practice on the Platform is not to deliver and users who do not request to transfer crypto assets do not receive full ownership, possession, and control over the crypto assets that they transacted in. The Staff Notice provides clarification on when Platforms that trade in bitcoin will be subject securities legislation. Generally, securities legislation will not apply to these Platforms where there is an obligation to deliver the crypto asset from the Platform to the user and immediate delivery occurs; and each of the following criteria apply: - a Platform offers services for users to buy or sell bitcoin and does not offer margin or leveraged trading; - users send money to the Platform to purchase bitcoin at a given price; - the terms of the transaction require that the entire quantity of bitcoin purchased from the Platform or counterparty seller be immediately transferred to a wallet that is in the sole control of the user, and the transfer is immediately reflected on the Bitcoin blockchain; - there is no agreement, arrangement or understanding between the parties that would allow the transaction to be settled other than by immediate transfer of bitcoin; - the Platform’s typical commercial practice is to make immediate delivery in accordance with the terms of the transaction, and for the Platform or its affiliates not to have ownership, possession or control of the user’s bitcoin at any point following the transaction; - the sale or purchase of bitcoin is not merely evidenced by an internal ledger or book entry that debits the seller’s account with the Platform and credits the crypto assets to the user’s account with the Platform, but rather, there is a transfer of the bitcoin to the user’s wallet; and - the Platform or counterparty seller retains no ownership, possession or control over the transferred bitcoin. *CSA Staff Notice 21-327 Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets* [is available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20200116_21-327_trading-crypto-assets.htm) from the websites of the Participating Jurisdictions. 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. **Categories:** News & Updates --- ### [Proposed New US Legislation to Regulate Stablecoins](https://baxsecuritieslaw.com/proposed-new-us-legislation-to-regulate-stablecoins/) **Published:** January 23, 2020 **Author:** Ray Luckiram **Excerpt:** In the U.S., stablecoins may be regulated by two bills recently proposed by members of Congress. The first bill, “Stablecoins are Securities Act of 2019,” aims to classify “managed stablecoins” as securities. The second bill, which is still untitled, could limit directors and executives of... **Content:** In the U.S., stablecoins may be regulated by two bills recently proposed by members of Congress. The first bill, “Stablecoins are Securities Act of 2019,” aims to classify “managed stablecoins” as securities. The second bill, which is still untitled, could limit directors and executives of publicly listed companies from holding managed stablecoins. Both bills are in draft form and may not be enacted. According to CNBC, the two federal bills could greatly affect Facebook’s proposed stablecoin, Libra.[\[1\]](#_ftn1) On November 21, 2019, Congresswoman Sylvia Garcia (D-TX) sponsored the bill, “*Stablecoins are Securities Act of 2019*,” (“Garcia Bill”) which states that “digital assets, known as managed stablecoins, are investment contracts and therefore are securities within the meaning given the term in section 2(a) of the Securities Act of 1933.” In the Garcia Bill, the term “managed stablecoin” is defined as any digital asset that is not registered under the federal statute regulating mutual funds and exchange-traded funds, and that satisfies at least one of the following criteria: 1. the market value of such digital asset is determined, in whole or in significant part, directly or indirectly, by reference to the value of a pool or basket of assets, including digital assets, held, designated or managed by one or more persons; or 2. one or more holders of such digital asset, directly or indirectly, are entitled to obtain consideration or other assets, including other digital assets and any sovereign currency of a foreign government or the United States, in exchange for the digital asset, the amount of which payment is determined, in whole or in significant part, directly or indirectly, on the basis of the value of a pool or basket of assets, including digital assets, held, designated or managed by one or more persons.[\[2\]](#_ftn2) Interestingly, the Garcia Bill also proposes a general definition of the term digital asset: > The term ‘digital asset’ means any asset, contract, agreement or transaction, including a representation of an economic, proprietary, or access right, that is stored in a computer-readable form and has or will have a transaction history that is recorded in a distributed ledger, digital ledger or other digital data structure. A digital asset may be a managed stablecoin and a security.[\[3\]](#_ftn3) The second bill (“San Nicolas Bill”) is sponsored by Del. Michael San Nicolas (D-Guam). It aims to “prohibit the listing of certain securities if the issuer, a director of the issuer, or an executive officer of the issuer buys or sells a managed stablecoin, and for other purposes.”[\[4\]](#_ftn4) As a result, the San Nicolas Bill would seem to require the Securities and Exchange Commission to delist the securities of any public company whose executives hold managed stablecoins. Both bills are currently in draft form and have not been formally introduced, so it is difficult to predict their trajectories. In June 2019, Facebook announced the creation of Libra, a new digital asset or cryptocurrency. Importantly, Libra’s value will be determined by a basket of assets.[\[5\]](#_ftn5)As such, it would fall under both proposed bills. This would result in more regulatory hurdles for the social media giant’s cryptocurrency plan. *For more information and a description of stable coins, please see our previous* [*article*](https://lawfirmbarbara.wpengine.com/stablecoins/) For more information, please call Barbara Hendrickson at BAX Securities Law (416) 601 -1004 or Ray Luckiram at (416) 601-0591. 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. --- \[1\] See Feiner, *New bill would make Facebook’s cryptocurrency a security under the law, inviting greater regulation*, available at https://www.cnbc.com/2019/11/21/new-bill-would-make-facebooks-cryptocurrency-a-security-under-the-law.html [\[2\]](#_ftnref2) Section 3, *Stablecoins are Securities Act of 2019*, H.R.5197 — 116th Congress (2019-2020*)*, Introduced in House (11/20/2019). [\[3\]](#_ftnref3) Section 3, *Stablecoins are Securities Act of 2019*, H.R.5197 — 116th Congress (2019-2020*)*, Introduced in House (11/20/2019). [\[4\]](#_ftnref4) Section 1, *A Bill*, H.R.5197 — 116th Congress (2019-2020*)*, Introduced in House (11/20/2019). [\[5\]](#_ftnref5) See Libra Association Members, *Libra White Paper,* available at https://libra.org/en-US/wp-content/uploads/sites/23/2019/06/LibraWhitePaper\_en\_US.pdf **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish CSA Notice 23-325, Update on Trading Fee Rebate Pilot Study](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-csa-notice-23-325-update-on-trading-fee-rebate-pilot-study/) **Published:** January 29, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published CSA Notice 23-325, Update on Trading Fee Rebate Pilot Study (the Update) on its plans to proceed with the Trading Fee Rebate Pilot Study (the Pilot Study), which would analyze the effects of the prohibition of marketplace trading... **Content:** The Canadian Securities Administrators (CSA) has published *CSA Notice 23-325, Update on Trading Fee Rebate Pilot Study* (the Update) on its plans to proceed with the Trading Fee Rebate Pilot Study (the Pilot Study), which would analyze the effects of the prohibition of marketplace trading fee rebate payments on market participants. The regulator notes that the launch of the Pilot Study is conditional on a similar study being implemented by the Securities and Exchange Commission in the United States (the SEC Fee Pilot). The Pilot Study would apply temporary pricing restrictions on marketplace trading fee rebates payable for transactions in a sample set of securities. The sample securities would include highly liquid and medium liquidity securities. It is part of the regulator’s plan to identify and address issues concerning trading fee rebates. Implementation of the Pilot Study is expected to occur on a staggered basis, in two stages: - interlisted securities in tandem with the implementation of the SEC Fee Pilot, if possible; and, - non-interlisted securities and exchange-traded products (ETP) three months following the introduction of interlisted securities. The Pilot Study will apply to all trading fee rebates paid by Canadian marketplaces, encompassing both exchanges and alternative trading systems (ATS), for the execution of orders concerning certain equity securities and ETPs. The securities to be considered by the Pilot Study are: - a set of securities selected from a list of highly liquid securities that are prepared and published by the Investment Industry Regulatory Organization of Canada (IIROC); and, a set of actively traded, medium liquidity securities that has been constructed by the Pilot Study’s authors. It is important to note that the Pilot Study will prohibit the payment of trading fee rebates, including linked pricing, by marketplaces regarding the trading in treated securities. It is also important to note that if the SEC Fee Pilot does not go forward, the CSA will consider conducting the Pilot Study with only non-interlisted securities. *CSA Notice 23-325 Trading Fee Rebate Pilot Study* [is available for download](https://www.osc.gov.on.ca/documents/en/Securities-Category2/csa_20200123_23-325_trading-fee-rebate.pdf) from the websites of the Participating Jurisdictions. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Issue CSA Multilateral Staff Notice 58-311, Report on Fifth Staff Review of Disclosure regarding Women on Boards and in Executive Officer Positions](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-csa-multilateral-staff-notice-58-311-report-on-fifth-staff-review-of-disclosure-regarding-women-on-boards-and-in-executive-officer-positions/) **Published:** January 29, 2020 **Author:** Barbara Hendrickson **Excerpt:** The securities regulators of Alberta, Manitoba, New Brunswick, Nova Scotia, Ontario, Quebec, and Saskatchewan (the participating jurisdictions) have jointly published CSA Multilateral Staff Notice 58-311 Report on Fifth Staff Review of Disclosure regarding Women on Boards and in Executive Officer Positions (The Staff Notice). This... **Content:** The securities regulators of Alberta, Manitoba, New Brunswick, Nova Scotia, Ontario, Quebec, and Saskatchewan (the participating jurisdictions) have jointly *published CSA Multilateral Staff Notice 58-311 Report on Fifth Staff Review of Disclosure regarding Women on Boards and in Executive Officer Positions* (The Staff Notice). This is the fifth review by the participating jurisdictions of disclosure of women on boards and in executive officer roles of reporting issuers since 2015 when *National Instrument 58-101 Disclosure of Corporate Governance Practices* was published. The Staff Notice summarizes the results of a review of issuers with year-ends between December 31, 2018, and March 31, 2019. The data was compiled from public documents filed on the System for Electronic Document Analysis and Retrieval (SEDAR) and includes the name, industry, and year-end of the 641 non-venture issuers who were included in the review sample. Key findings include: - The total percentage of board seats held by women rose to 17% in 2019, up from 11% in 2015. This figure increased by 2% from 2018. - When board seats became available and were filled, 33% were filled by women, up 3% from 2018. - The number of issuers with at least one woman on their board increased to 73% in 2019, up from 66% in 2018, and rising from 49% in 2015. However, 170 issuers reported they had no women on their boards. - 50% of issuers had adopted a policy on identifying and nominating women directors in 2019, up significantly from 42% in 2018. This represents an over threefold increase since 2015. - Issuers that adopted targets for the representation of women on their boards increased significantly to 22% in 2019, up from 16% in 2018, and 7% in 2015. - The number of issuers with at least one woman in executive officer positions fell to 64% in 2019 from 66% in 2018, but still represented an overall increase from 60% in 2015. Of all issuers, 4% reported having a female CEO, which remained unchanged over the previous year. Meanwhile, the number of issuers with a female CFO rose to 16% in 2019, up from 15% in 2018. CSA staff noted that the number of women on boards tended to vary with industry. For example, the manufacturing, retail, and utility sectors had the highest percentage of issuers with one or more women in executive officer positions, while the biotechnology, oil, and gas and mining sectors had the lowest percentage. *CSA Multilateral Staff Notice 58-311*[ is available for download](https://www.osc.gov.on.ca/documents/en/Securities-Category5/sn_20191002_58-311_staff-review-women-on-boards.pdf) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [Climate-Change Related Disclosure Becomes Hotter Topic in EU and US](https://baxsecuritieslaw.com/climate-change-related-disclosure-becomes-hotter-topic-in-eu-and-us/) **Published:** February 10, 2020 **Author:** Barbara Hendrickson **Excerpt:** Two recent announcements, one in the United States, and the other in the European Union, provide further evidence that securities regulators are paying closer to attention to climate change disclosure by market participants. A recent address by Jay Clayton, Chairman of the Securities and Exchange... **Content:** Two recent announcements, one in the United States, and the other in the European Union, provide further evidence that securities regulators are paying closer to attention to climate change disclosure by market participants. A recent address by Jay Clayton, Chairman of the Securities and Exchange Commission (SEC), highlighted the growing interest of the U.S. regulator regarding climate change disclosure. Clayton noted that the landscape around these issues “will continue to be complex, uncertain, multi-national/jurisdictional and dynamic.” He also said that issuers and investors will also face climate-related factors that are “substantially forward-looking” and will likely have to make estimates based on or materially influenced by climate-related factors. Current disclosure, said Clayton, is based on the provision of currently verifiable and largely historic issuer-specific information. Because climate change disclosure may become more forward-looking in nature, he noted the requirements surrounding that type of disclosure are limited and, in many cases, it is required or provided voluntarily, the information is afforded safe-harbor protection. “When crafting and implementing disclosure mandates and guidance,” said Clayton, “I am, and must remain, mindful that as a standard-setter, I should not be substituting my operational and capital allocation judgments for those of issuers and investors. More generally, I believe all standard-setters should take care to stay within the bounds of their regulatory mandates.” Meanwhile, Parliament of the European Union has arrived at a set of new rules (the taxonomy regulation) to determine which investments are to be considered environmentally and socially sustainable and which will ultimately help achieve the EU’s goal of carbon neutrality. The taxonomy regulation spells out that the following environmental objectives should be considered when evaluating how sustainable a given economic activity is: - climate change mitigation and adaptation; - sustainable use and protection of water and marine resources; - transition to a circular economy, including waste prevention and - increasing the uptake of secondary raw materials; - pollution prevention and control; and, - protection and restoration of biodiversity and ecosystems. Aside from fossil fuels that use coal or lignite, specific technologies are not blacklisted by the new rules. Sectors depending on natural gas and nuclear energy can be potentially included as part of transitional activities. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish Staff Notice 21-326, Order Protection Rule: Market Share Threshold](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-staff-notice-21-326-order-protection-rule-market-share-threshold/) **Published:** February 18, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published CSA Staff Notice 23-326, Order Protection Rule: Market Share Threshold for the period April 1, 2020 to March 31, 2021 (the Staff Notice and Proposed Rule), for a second notice and comment period ending May 13, 2020. The... **Content:** The Canadian Securities Administrators (CSA) have published *CSA Staff Notice 23-326, Order Protection Rule: Market Share Threshold for the period April 1, 2020 to March 31, 2021* (the Staff Notice and Proposed Rule), for a second notice and comment period ending May 13, 2020. The Proposed Rule would establish disclosure requirements for issuers that disclose non-GAAP (Generally Accepted Accounting Principles) and other financial measures, which often lack standardized meanings, resulting in potentially misleading disclosure. The purpose of the Staff Notice is to provide the list of marketplaces displaying protected orders (protected marketplaces) and marketplaces whose orders are not protected (unprotected marketplaces) under National Instrument 23-101 Trading Rules (NI 23-101) and the order protection rule (OPR) for the period April 1, 2020, to March 31, 2021, because they do not: - provide automated trading functionality as they have an intentional order processing delay, and/or; - meet the market share threshold, which has been set at 2.5%. The Staff Notice updates the list of protected and unprotected marketplaces published on January 31, 2019. The updated list will be in effect from April 1, 2020, to March 31, 2021. CSA staff note that there are no changes compared to the list published last year. *CSA Staff Notice 21-326 Order Protection Rule: Market Share Threshold for the period April 1, 2020 to March 31, 2021* [is available for download](https://www.bcsc.bc.ca/Securities_Law/Policies/Policy2/PDF/23-326__CSA_Staff_Notice___February_13__2020/) from the websites of the Participating Jurisdictions. 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. **Categories:** News & Updates --- ### [Mutual Fund Dealers Association of Canada Proposes New “Purpose Built” Securities Regulator](https://baxsecuritieslaw.com/mutual-fund-dealers-association-of-canada-proposes-new-purpose-built-securities-regulator/) **Published:** February 20, 2020 **Author:** Barbara Hendrickson **Excerpt:** In its recent MFDA Special Report on Securities Industry Self-Regulation (the Report), The Mutual Fund Dealers Association (MFDA) has proposed the creation of a new securities regulator that if adopted, would replace MFDA. The Report, which explores the self-regulatory organization (SRO) environment in Canada, proposes... **Content:** In its recent *MFDA Special Report on Securities Industry Self-Regulation* (the Report), The Mutual Fund Dealers Association (MFDA) has proposed the creation of a new securities regulator that if adopted, would replace MFDA. The Report, which explores the self-regulatory organization (SRO) environment in Canada, proposes creating a new “purpose-built” SRO. This new SRO, which the MFDA has dubbed NewCo (NewCo), would be one that the regulator believes is suited to the changes of the past decade, improves on the existing model, and is adaptable to the dynamic nature of securities regulation in Canada. If the proposal goes forward, the MFDA would no longer exist as a separate SRO, allowing for the establishment of an “ideal” SRO (NewCo), based on cooperation with Canadian Securities Administrator (CSA) members, SROs, industry and public stakeholders. To further that end, NewCo would work alongside the Canadian Securities Administrators (CSA) and provide the CSA with greater SRO oversight capacity, registrant, and market conduct visibility and regulatory expertise, leading to what the MFDA calls “a modern CSA/securities industry regulator partnership.” Bulletin #0809-M – MFDA Special Report on Securities Industry Self-Regulation can found [on the website](https://mfda.ca/bulletin/bulletin0809-m/) of the Mutual Fund Dealers Association of Canada. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Adopt Ban on Deferred Sales Charges on Mutual Funds](https://baxsecuritieslaw.com/canadian-securities-administrators-adopt-ban-on-deferred-sales-charges-on-mutual-funds/) **Published:** February 21, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have adopted a ban on deferred sales charges (the DSC Option) on mutual funds. Specifically, the ban will prohibit the payment by fund organizations of upfront sales commissions to dealers, which will result in the discontinuation of all forms of... **Content:** The Canadian Securities Administrators (CSA) have adopted a ban on deferred sales charges (the DSC Option) on mutual funds. Specifically, the ban will prohibit the payment by fund organizations of upfront sales commissions to dealers, which will result in the discontinuation of all forms of the deferred sales charge option including low-load options (collectively, the DSC option). The ban is expected to become effective in all member jurisdictions, except Ontario, on June 1, 2022. The Ontario Securities Commission (OSC) will not adopt the proposal but will publish for comment an alternative proposal to address the investor protection and market efficiency issues arising from the payment of upfront sales commissions by fund organizations to dealers. The ban on the DSC option comes with the adoption of Multilateral CSA Notice of Amendments to National Instrument 81-105 Mutual Fund Sales Practices, Changes to Companion Policy 81-105CP to National Instrument 81-105 Mutual Fund Sales Practices and Changes to Companion Policy 81-101CP to National Instrument 81-101 Mutual Fund Prospectus Disclosure relating to Prohibition of Deferred Sales Charges for Investment Funds (together, the Amendments). The Amendments are[ available for download](https://www.bcsc.bc.ca/Securities_Law/Policies/Policy8/PDF/81-105__CSA_Notice___February_20__2020/) from the websites of the Participating Jurisdictions. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Propose New National Harmonized Crowdfunding Rules](https://baxsecuritieslaw.com/canadian-securities-administrators-propose-new-national-harmonized-crowdfunding-rules/) **Published:** March 2, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published Proposed National Instrument 45-110 Start-up Crowdfunding Registration and Prospectus Exemptions (the Proposed National Instrument), for a 90-day comment period ending May 27, 2020. The Proposed National Instrument would replace and further harmonize the crowdfunding requirements currently in effect in... **Content:** The Canadian Securities Administrators (CSA) have published Proposed National Instrument 4*5-110 Start-up Crowdfunding Registration and Prospectus Exemptions* (the Proposed National Instrument), for a 90-day comment period ending May 27, 2020. The Proposed National Instrument would replace and further harmonize the crowdfunding requirements currently in effect in British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick, and Nova Scotia. Securities crowdfunding (crowdfunding) has rapidly emerged as an alternative method for businesses, particularly start-ups and early-stage issuers, to raise capital. Through crowdfunding, a business raises capital through online portals by issuing securities (such as shares or debt instruments) to investors. Crowdfunding is intended to provide an alternative source of capital to non-reporting issuers at an earlier stage of development. Prior to the introduction of the Proposed National Instrument, different regulatory regimes for the crowdfunding of securities had emerged in different Canadian jurisdictions. Blanket orders issued (the blanket orders) in May 2014 by the securities regulators of British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick, and Nova Scotia, provided for substantially harmonized registration and prospectus exemptions that allowed start-ups and early-stage issuers to raise capital in these jurisdictions through securities crowdfunding. In October 2019, the Alberta Securities Commission (ASC) adopted a blanket order that substantially harmonized registration and prospectus exemption with those of British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick, and Nova Scotia. In January 2016, Multilateral Instrument 45-108 Crowdfunding (MI 45-108) came into force in Saskatchewan, Manitoba, Ontario, Québec, New Brunswick, and Nova Scotia, while Alberta adopted MI 45-108 in February 2017. Alberta also relies upon ASC Rule 45-517 Prospectus Exemption for Start-up Businesses (ASC Rule 45-517) which came into force in July 2016 and is similar to the blanket orders but does not provide an exemption from the registration requirement and does not require the use of a funding portal. Proposed National Instrument 4*5-110 Start-up Crowdfunding Registration and Prospectus Exemptions* [*are available for download*](https://www.bcsc.bc.ca/Securities_Law/Policies/Policy4/PDF/45-110_CSA_Notice_and_Request_for_Comment__CSA_Notice___February_27__2020/) from the websites of the Participating Jurisdictions. 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. **Categories:** News & Updates --- ### [Regulators Batten Down the Financial Hatches as Coronavirus Impacts Markets](https://baxsecuritieslaw.com/regulators-batten-down-the-financial-hatches-as-coronavirus-impacts-markets/) **Published:** March 13, 2020 **Author:** Barbara Hendrickson **Excerpt:** As the COVID-19 coronavirus spreads across the globe, investor uncertainty over the economic impact of the coronavirus is increasingly reflected in the markets. Financial regulators have begun to take note and react. Early in March, in the United States, the Securities and Exchange Commission (SEC)... **Content:** As the COVID-19 coronavirus spreads across the globe, investor uncertainty over the economic impact of the coronavirus is increasingly reflected in the markets. Financial regulators have begun to take note and react. Early in March, in the United States, the Securities and Exchange Commission (SEC) announced it was applying conditional regulatory relief certain publicly traded company filing obligations under the federal securities laws. The impacts of the coronavirus, said the regulator, may present challenges for certain companies that are required to provide information to trading markets, shareholders, and the SEC. These companies may include U.S. companies located in the affected areas, as well as companies with operations in those regions. In order to ease the compliance burden, the SEC has issued an [order](https://www.sec.gov/rules/other/2020/34-88318.pdf) subject to certain conditions, provides publicly traded companies with an additional 45 days to file certain disclosure reports that would otherwise have been due between March 1 and April 30, 2020. Companies must convey through a current report a summary of why the relief is needed in their particular circumstances. The regulator may extend the time period for the relief, with any additional conditions it deems appropriate, or provide additional relief as circumstances warrant. “…we recognize that this situation may prevent certain issuers from compiling these reports within required timeframes,” said SEC Chairman Jay Clayton. Meanwhile, the Bank of Canada (BOC), in an effort to blunt the impact of the coronavirus outbreak on the Canadian economy, slashed its key target rate a half percent to 1.25% last week, the first rate cut since the summer of 2015. “The downside risks to the economy today are more than sufficient to outweigh our continuing concern about financial vulnerabilities,” said Bank of Canada Governor Stephen Poloz. 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. **Categories:** News & Updates --- ### [Ontario Securities Commission Publishes Proposed Rule on Deferred Sales Charges on Mutual Funds for Comment](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-proposed-rule-on-deferred-sales-charges-on-mutual-funds-for-comment/) **Published:** March 13, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has published for comment Proposed Ontario Securities Rule 81-502, Restrictions on the use of the Deferred Sales Charge Option for Mutual Funds (The Proposed Rule) restricting the use of deferred sales charges (the DSC Option) on mutual funds, for a... **Content:** The Ontario Securities Commission (OSC) has published for comment *Proposed Ontario Securities Rule 81-502, Restrictions on the use of the Deferred Sales Charge Option for Mutual Funds (The Proposed Rule)* restricting the use of deferred sales charges (the DSC Option) on mutual funds, for a comment period ending May 1, 2020. The Proposed Rule is intended to address negative investor outcomes by limiting the circumstances in which mutual funds with the DSC Option can be sold and by giving clients greater flexibility to redeem these investments without penalties. The rule would prohibit the sale of mutual funds with the DSC option to clients who are aged 60 and over, or who have an investment time horizon that is shorter than the DSC schedule. The rule would also prohibit sales to clients who intend to use borrowed money to finance their purchase and would impose a $50,000 threshold for maximum account. The new rule would also shorten the maximum term of the DSC schedule to three years. The OSC expects the rule to become effective June 1, 2022. This date is in line with the member jurisdictions of the Canadian Securities Administrators (CSA) except Ontario, which recently adopted Multilateral CSA Notice of Amendments to National Instrument 81-105 Mutual Fund Sales Practices, Changes to Companion Policy 81-105CP to National Instrument 81-105 Mutual Fund Sales Practices and Changes to Companion Policy 81-101CP to National Instrument 81-101 Mutual Fund Prospectus Disclosure relating to Prohibition of Deferred Sales Charges for Investment Funds (together, the Amendments), banning the DSC Option. *Proposed Ontario Securities Rule 81-502, Restrictions on the use of the Deferred Sales Charge Option for Mutual Funds* is [available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20200220_81-502-rfc-deferred-sales-charge-option-mutual-funds.htm) from the website of the Ontario Securities Commission. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish CSA Staff Notice 21-328 Regulatory Approach to Foreign Marketplaces Trading Fixed Income Securities](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-csa-staff-notice-21-328-regulatory-approach-to-foreign-marketplaces-trading-fixed-income-securities/) **Published:** March 15, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published CSA Staff Notice 21-328 Regulatory Approach to Foreign Marketplaces Trading Fixed Income Securities(the Staff Notice). The Staff Notice discusses the framework developed by the CSA that will grant exemptions to foreign alternative trading systems trading fixed income securities... **Content:** The Canadian Securities Administrators (CSA) have published *CSA Staff Notice 21-328* *Regulatory Approach to Foreign Marketplaces Trading Fixed Income Securities*(the Staff Notice). The Staff Notice discusses the framework developed by the CSA that will grant exemptions to foreign alternative trading systems trading fixed income securities (foreign ATSs) that request to carry on business in Canada. In the same Staff Notice, the regulator also advises that foreign multilateral trading facilities (foreign MTFs) may be permitted to trade fixed income securities. Under the exemption model, foreign ATSs may be permitted to offer direct access to Canadian participants without having to establish a Canadian-based affiliate, provided they meet certain terms and conditions, including a requirement that they comply with the applicable regulation in their home jurisdiction. To offer direct access to Canadian participants, a foreign ATS would need to apply for an exemption from the Marketplace Rules. Regarding the situation where a foreign MTF seeking to offer direct trading in fixed income securities to Canadian participants, the MTF may apply to expand its existing exchange exemption order to allow for trading of fixed income securities. Additional terms and conditions may be appropriate to facilitate this trading. Although the proposed exemption would grant foreign ATSs relief from the Marketplace Rules, depending on their model of operations, the regulator advises that foreign ATSs or their participants may still be subject to registration under applicable securities legislation. Foreign ATSs may trigger registration requirements under applicable Canadian securities laws because they may engage in the business of trading. *CSA Staff Notice 21-328 Regulatory Approach to Foreign Marketplaces Trading Fixed Income Securities* [is available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20200305_21-328_foreign-marketplaces-trading-fixed-income-securities.htm?RSS=IRPEN&RSS=IRPEN) from the websites of the Participating Jurisdictions. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Adopt Harmonized Pre-File Review of Prospectus](https://baxsecuritieslaw.com/canadian-securities-administrators-adopt-harmonized-pre-file-review-of-prospectus/) **Published:** March 15, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have issued CSA Staff Notice 43-310 Confidential Pre-File Review of Prospectuses (for non-investment fund issuers) (the Staff Notice). The Staff Notice expands the availability of confidential pre-file reviews that some CSA jurisdictions are already conducting. Pre-file review (the pre-file process)... **Content:** The Canadian Securities Administrators (CSA) have issued CSA Staff Notice 43-310 Confidential Pre-File Review of Prospectuses (for non-investment fund issuers) (the Staff Notice). The Staff Notice expands the availability of confidential pre-file reviews that some CSA jurisdictions are already conducting. Pre-file review (the pre-file process) allows for the earlier identification of material issues that might delay receipting the prospectus and closing the offering. The pre-file process can be used by any non-investment fund issuer in a Canadian jurisdiction but should be made with the principal regulator only. Issuers can use the pre-file process to pre-file a long-form prospectus under National Instrument 41-101 General Prospectus Requirements (NI 41-101), a short form prospectus under National Instrument 44-101 Short Form Prospectus Distributions (NI 44-101), and a base shelf prospectus under National Instrument 44-102Shelf Distributions (NI 44-102). It should be noted that the pre-file process does not apply to structured notes distributed under the shelf prospectus system as discussed in CSA Staff Notice 44-304 Linked Notes Distributed under Shelf Prospectus System and CSA Staff Notice 44-305 2015 Update – Structured Notes Distributed Under the Shelf Prospectus System. It also does not apply to: - non-offering prospectuses, other than non-offering prospectuses filed in connection with cross-border financings; and, - prospectuses filed solely to qualify the issuance of securities on the conversion of convertible securities, such as special warrants. *CSA Staff Notice 43-310 Confidential Pre-File Review of Prospectuses* [is available for download](https://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20200305_43-310_confidential-pre-file-review-prospectuses.htm) from the websites of the Participating Jurisdictions. 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. **Categories:** News & Updates --- ### [Canadian securities regulators provide update on COVID-19 and potential filing delays by reporting issuers](https://baxsecuritieslaw.com/canadian-securities-regulators-provide-update-on-covid-19-and-potential-filing-delays-by-reporting-issuers/) **Published:** March 17, 2020 **Author:** Barbara Hendrickson **Excerpt:** On March 16, 2020 the Canadian Securities Administrators (CSA) issued a press release which encourages reporting issuers to contact their principal regulator to discuss any potential effect of the current COVID-19 outbreak on their ability to comply with their obligations under securities legislation, including filing deadlines... **Content:** On March 16, 2020 the Canadian Securities Administrators (CSA) issued a press release which encourages reporting issuers to contact their principal regulator to discuss any potential effect of the current COVID-19 outbreak on their ability to comply with their obligations under securities legislation, including filing deadlines or delivery of meeting materials. Issuers that foresee not being able to file their annual or interim financial statements by their prescribed deadline because of the current COVID-19 outbreak should consider applying for a management cease-trade order (MCTO). Under normal circumstances, applications for an MCTO should be filed at least two weeks before the due date for the required filings, however we will work to accommodate shorter periods where necessary. An MCTO restricts certain officers and directors from trading and may be issued by a regulator instead of a failure-to-file cease-trade order. Conditions for granting an MCTO are provided in *National Policy 12-203 Management Cease Trade Orders* (NP 12-203). If an MCTO is issued, the issuer must comply with alternative information guidelines as provided in NP 12-203 until the required documents are filed. MCTOs issued in these circumstances will not be considered required disclosure in future documents. For further information please see: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20200316\_csa-update-covid-19-potential-filing-delays-reporting-issuers.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20200316_csa-update-covid-19-potential-filing-delays-reporting-issuers.htm) 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. **Categories:** News & Updates --- ### [Canadian securities regulators propose changes to tackle financial exploitation and diminished mental capacity of older and vulnerable clients](https://baxsecuritieslaw.com/canadian-securities-regulators-propose-changes-to-tackle-financial-exploitation-and-diminished-mental-capacity-of-older-and-vulnerable-clients/) **Published:** March 19, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) published for comment on March 5, 2020 proposed amendments designed outline how registrants can address situations involving diminished mental capacity or the potential financial exploitation of vulnerable clients. Under the proposed amendments, registrants will be required to take reasonable steps... **Content:** The Canadian Securities Administrators (CSA) published for comment on March 5, 2020 proposed amendments designed outline how registrants can address situations involving diminished mental capacity or the potential financial exploitation of vulnerable clients. Under the proposed amendments, registrants will be required to take reasonable steps to obtain the name and contact information of a Trusted Contact Person (TCP) from their clients, as well as the client’s written consent to contact the TCP in specified circumstances. Additionally, the proposed amendments set out the steps that a registered firm must take if they place a temporary hold on a transaction due to a reasonable belief that a vulnerable client is being financially exploited, or that a client lacks mental capacity. The proposed amendments also clarify that Canadian securities legislation does not prevent a registered firm from placing temporary holds in circumstances where the firm has a reasonable belief of these concerns. The proposed amendments were developed together with the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA). The comment period closes on June 3, 2020. Subject to the nature of comments received, the CSA anticipates that the proposed amendments will come into force at the same time as the Client Focused Reforms relating to enhanced “Know Your Client” (KYC) requirements. The notice is available at: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20200305\_csa-propose-changes-older-vulnerable-clients.htm?RSS=HLEN&RSS=HLEN](https://www.osc.gov.on.ca/en/NewsEvents_nr_20200305_csa-propose-changes-older-vulnerable-clients.htm?RSS=HLEN&RSS=HLEN) The CSA also published, for a 90-day comment period, proposed amendments (the **Proposed Amendments**) to National Instrument 31-103 *Registration Requirements, Exemptions and Ongoing Registrant Obligations* (**NI 31-103** or the **Rule**) and Companion Policy 31-103CP *Registration Requirements, Exemptions and Ongoing Registrant Obligations* (**31-103CP**, together the **Instrument**) relating to business operations and client relationships in order to enhance investor protection by addressing issues of financial exploitation and diminished mental capacity of older and vulnerable clients. The CSA worked together with the Investment Industry Regulatory Organization of Canada (**IIROC**) and the Mutual Fund Dealers Association of Canada (**MFDA**) to develop the Proposed Amendments. The Proposed Amendments will require registrants to take reasonable steps to obtain the name and contact information of a trusted contact person (**TCP**) as well as the clients’ permission to contact the TCP in prescribed circumstances. The TCP is intended to be a resource for registrants to assist in protecting their clients against possible financial exploitation or where there are concerns about the clients’ mental capacity. Amendments do not prevent registrants from opening and maintaining an account if a client refuses or fails to identify a TCP as long as the registrant takes reasonable steps to obtain the information. Proposed Amendments will allow registered firms and registered individuals to place a temporary hold on the purchase or sale of a security or withdrawal or transfer of cash or securities from a clients account if the registrants believes that a vulnerable client is being financially exploited, orwith respect to an instruction given by the client, the client does not have the mental capacity to make financial decisions, and require registered firms to take certain prescribed steps if they place a temporary hold in the above noted circumstances. For a copy of the request for comments, please see: [https://www.osc.gov.on.ca/documents/en/Securities-Category3/csa\_20200305\_31-103\_protection-older-vulnerable-clients.pdf](https://www.osc.gov.on.ca/documents/en/Securities-Category3/csa_20200305_31-103_protection-older-vulnerable-clients.pdf) 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. **Categories:** News & Updates --- ### [Canadian securities regulators to provide blanket relief for market participants due to COVID-19](https://baxsecuritieslaw.com/canadian-securities-regulators-to-provide-blanket-relief-for-market-participants-due-to-covid-19/) **Published:** March 19, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) announced on March 18, 2020 will provide temporary relief from some regulatory filings required to be made on or before June 1, 2020 in light of recent COVID-19 developments and their impact on market participants, The blanket relief will provide... **Content:** The Canadian Securities Administrators (CSA) announced on March 18, 2020 will provide temporary relief from some regulatory filings required to be made on or before June 1, 2020 in light of recent COVID-19 developments and their impact on market participants, The blanket relief will provide a 45-day extension for periodic filings normally required to be made by issuers, investment funds, registrants, certain regulated entities and designated rating organizations on or before June 1, 2020. This will include financial statements, management’s discussion and analysis, management reports of fund performance, annual information forms, technical reports, and certain other filings. Issuers choosing to rely on this exemption and that are complying with the conditions of the relief will not need to file applications for management cease trade orders as they will not be noted in default. The CSA also announced that they are supportive of virtual securityholder meetings as a social distancing measures. “The CSA is supportive of measures issuers are taking to mitigate the risk of transmission and will publish guidance on making changes to annual general meetings as soon as possible.” 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. **Categories:** News & Updates --- ### [Canadian securities regulators warn public of coronavirus-related investment scams and the OSC reports on reduction of services due to COVID-19](https://baxsecuritieslaw.com/canadian-securities-regulators-warn-public-of-coronavirus-related-investment-scams-and-the-osc-reports-on-reduction-of-services-due-to-covid-19/) **Published:** March 20, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) published a notice on March 19, 2020 warning investors about companies claiming to have products or services that will prevent, detect or cure coronavirus (COVID-19) infection. According to the notice fraudsters taking advantage of the current situation to attract potential... **Content:** The Canadian Securities Administrators (CSA) published a notice on March 19, 2020 warning investors about companies claiming to have products or services that will prevent, detect or cure coronavirus (COVID-19) infection. According to the notice fraudsters taking advantage of the current situation to attract potential investors with the expectations of significant returns through pump-and-dump schemes involving publicly traded small “shell” companies which are offering fraudulent opportunities related to COVID-19. In a separate release the Ontario Securities Commission (OSC) announced on March 19, 2020 that in response to the COVID-19 that most OSC staff will be working from home. There will be limiting external access to our offices to only those required for essential operations. In response to market participants working remotely the OSC states that it “will be flexible in our regulatory expectations during this difficult time.” On-site compliance reviews and planned Risk Assessment Questionnaire are postponed until further notice. Normal-course registration and compliance activities will continue as planned, however we will be flexible on deadlines for information. The OSC will not be holding in-person hearings until at least April 30, 2020. The Office of the Secretary will reach out to parties with hearings scheduled between now and April 30 to determine if a hearing may proceed via teleconference or in writing. For more information see: 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. **Categories:** News & Updates --- ### [Canadian securities regulators publish blanket relief for market participants due to COVID-19](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-blanket-relief-for-market-participants-due-to-covid-19/) **Published:** March 23, 2020 **Author:** Barbara Hendrickson **Excerpt:** [et_pb_section admin_label="section"] [et_pb_row admin_label="row"] [et_pb_column type="4_4"][et_pb_text admin_label="Text"] Further to its announcement on March 18, the Canadian Securities Administrators (CSA) announced on March 23, 2020 a temporary blanket relief for market participants from certain regulatory filings, as a result of COVID-19. The blanket relief provides a 45-day extension... **Content:** \[et\_pb\_section admin\_label=”section”\] \[et\_pb\_row admin\_label=”row”\] \[et\_pb\_column type=”4\_4″\]\[et\_pb\_text admin\_label=”Text”\] Further to its [announcement](https://www.securities-administrators.ca/aboutcsa.aspx?id=1877) on March 18, the Canadian Securities Administrators (CSA) announced on March 23, 2020 a temporary blanket relief for market participants from certain regulatory filings, as a result of COVID-19. The blanket relief provides a 45-day extension for periodic filings normally required to be made by issuers, investment funds, registrants, certain regulated entities and designated rating organizations on or before June 1, 2020 and for certain other requirements outlined in the orders. Market participants need to comply with the conditions in the blanket relief to use the extension. The CSA is implementing the relief through local blanket orders that are substantially harmonized across the country. Market participants can view these orders on CSA members’ websites and are encouraged to contact their principal regulator with any questions. The Ontario Securities Commission (OSC) published on March 23, 2020 a Notice of General Order Ontario Instrument 25-502 *Temporary exemption from certain reporting requirements for Regulated Entities carrying on business in Ontario.* As a result of the Coronavirus pandemic the OSC is providing temporary relief from certain regulatory filing requirements under Ontario securities law and Ontario commodity futures law that apply to marketplaces, as defined in subsection 1(1) of the *Securities Act* (Ontario) (“**OSA**”), clearing agencies, as defined in subsection 1(1) of the OSA, designated trade repositories, as defined in subsection 1(1) of the OSA, designated information processors, as defined in subsection 1(1) of the OSA, and commodity futures exchanges, as defined in subsection 1(1) of the *Commodity Futures Act* (Ontario) (“**CFA**”) (the “**Regulated Entities**”). Order 25-502 provides that any Regulated Entity carrying on business in Ontario that would be required to provide the Commission with certain documents or other information specified in the order including financial statements between the date of the order and June 1, 2020 is exempt from the requirement, provided that the Regulated Entity: 1. Provides the Commission with the documents or other information no later than 45 days after the original due date for the documents or information; and 2. Discloses to the Commission that it is relying on the order and states the reasons why it could not submit the document or information by the original due date. The Order 25-502 comes into effect on March 23, 2020, and remains in effect for a period of 120 days. For more information see: [https://www.osc.gov.on.ca/documents/en/Securities-Category2/rule\_20200323\_25-502\_general-order-temporary-exemption-reporting-requirements-regulated-entities.pdf](https://www.osc.gov.on.ca/documents/en/Securities-Category2/rule_20200323_25-502_general-order-temporary-exemption-reporting-requirements-regulated-entities.pdf) The OSC published a second order on March 23, 2020, Notice of General Order Ontario 81-503 Extension of Certain Filing, Delivery and Prospectus Renewal Requirements of Investment Funds. Order 81-503 provides temporary relief from certain requirements under Ontario securities law that apply to investment funds, as defined in subsection 1(1) of the Securities Act (Ontario). Order 81-503 provides that: 1. certain filing and delivery obligations of investment funds under securities legislation, where the obligations are required to be met during the period from March 23, 2020 to June 1, 2020, are extended for a period of 45 days; and 2. certain investment funds distributing securities under a prospectus with a lapse date during the period from March 23, 2020 to June 1, 2020 will have the lapse date extended for a period of 45 days. The relief provided above is includes the following terms and conditions: - any investment fund relying on the order must, as soon as reasonably practicable, notify the Director of the Investment Funds and Structured Products Branch by email at IFSPDirector@osc.gov.on.ca stating that the investment fund is relying on the order and each applicable requirement for which it is relying on the order; and - an investment fund relying on the order must, as soon as reasonably practicable, post a statement on its public website, or the public website of its investment fund manager, stating that the investment fund is relying on the order and each applicable requirement for which it is relying on the order. Order 81-503 comes into effect on March 23, 2020, and remains in effect for a period of 120 days. For more information see: [https://www.osc.gov.on.ca/en/SecuritiesLaw\_rule\_20200323\_81-503\_general-order-extension-investment-funds.htm](https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20200323_81-503_general-order-extension-investment-funds.htm) The OSC also published on March 23, 2020, a third order Ontario Instrument 51-502 Temporary Exemption from Certain Corporate Finance Requirements providing issuers and designated rating organizations with temporary relief from certain requirements of Ontario securities law. Order 51-502 provides that: 1. A person or company required to make an annual or interim filing listed in the order (financial statements and MD&A) , or to send or deliver a document listed in the order, during the period from March 23, 2020 to June 1, 2020, has an additional 45 days from the deadline otherwise applicable under Ontario securities law to make the filing or to send or deliver the document, provided that certain conditions set out in the order are satisfied; 2. A person or company required to make a continuous disclosure filing listed in the order (financial disclosure), or to send or deliver a document listed the order, during the period from March 23, 2020 to June 1, 2020, has an additional 45 days from the deadline otherwise applicable under Ontario securities law to make the filing or to send or deliver the document, subject to a condition set out in the order; 3. A person or company required to make a filing listed in the order (financial disclosure) relating to an exempt distribution or to a designated rating organization, or to send or deliver a document listed the order, during the period from March 23, 2020 to June 1, 2020, has an additional 45 days from the deadline otherwise applicable under Ontario securities law to make the filing or to send or deliver the document, provided that certain conditions set out in the order are satisfied; and 4. A person or company subject to a lapse date for a final base shelf prospectus referred to in the order, that occurs during the period from March 23, 2020 to June 1, 2020, may add an additional 45 days to that lapse date, provided that certain conditions set out in the order are satisfied. Order 51-502 comes into effect on March 23, 2020, and remains in effect for a perod of 120 days. For more information please see: [https://www.osc.gov.on.ca/documents/en/Securities-Category5/sn\_20200323\_51-502\_general-order-temporary-exemption-certain-corporate-finance-requirements.pdf](https://www.osc.gov.on.ca/documents/en/Securities-Category5/sn_20200323_51-502_general-order-temporary-exemption-certain-corporate-finance-requirements.pdf) 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. \[/et\_pb\_text\]\[/et\_pb\_column\] \[/et\_pb\_row\] \[/et\_pb\_section\] [previousCanadian securities regulators warn public of coronavirus-related investment scams and the OSC reports on reduction of services due to COVID-19](https://baxsecuritieslaw.com/canadian-securities-regulators-warn-public-of-coronavirus-related-investment-scams-and-the-osc-reports-on-reduction-of-services-due-to-covid-19/) [nextTSX Venture Exchange Extends Deadlines for AGM and Stock Option Plan Approval](https://baxsecuritieslaw.com/tsx-venture-exchange-extends-deadlines-for-agm-and-stock-option-plan-approval/) ### About BAX Securities Law® Corporate Securities & Financial Services Lawyers BAX Securities Law® practises in the securities and financial services regulatory areas and has acted as counsel to major Canadian and American corporations, market participants. #### Legal Services If you wish to discuss retaining BAX Securities Law® to provide you with legal services, please contact: **Barbara Hendrickson** Managing Partner **416.601.1004** [*bhendrickson@baxsecuritieslaw.com*](mailto:bhendrickson@baxsecuritieslaw.com) [Get In Touch](https://baxsecuritieslaw.com/consult/) **Categories:** News & Updates --- ### [TSX Venture Exchange Extends Deadlines for AGM and Stock Option Plan Approval](https://baxsecuritieslaw.com/tsx-venture-exchange-extends-deadlines-for-agm-and-stock-option-plan-approval/) **Published:** March 25, 2020 **Author:** Barbara Hendrickson **Excerpt:** TSX Venture Exchange (the “Exchange”) on March 23, 2020 has announced temporary blanket relief (the “Temporary Relief”) from certain provisions of the Exchange’s Corporate Finance Manual (the “Manual”) as described in more detail below. The Exchange is extending the timeframe within which Issuers must hold... **Content:** TSX Venture Exchange (the “Exchange”) on March 23, 2020 has announced temporary blanket relief (the “Temporary Relief”) from certain provisions of the Exchange’s Corporate Finance Manual (the “Manual”) as described in more detail below. The Exchange is extending the timeframe within which Issuers must hold their annual meeting of Shareholders. Under Policy 3.2, section 4.1 of the Manual, every Issuer must hold an annual meeting of its Shareholders by the earlier of the time required by applicable corporate or securities legislation and 18 months after: (a) the date of its incorporation; or (b) the date of its certificate of amalgamation, in the case of an amalgamated Issuer; and subsequently thereafter in each year not more than 15 months after its last preceding annual meeting of Shareholders or such earlier date as required by applicable corporate or Securities Laws. Pursuant to the Temporary Relief, the Exchange is permitting an Issuer that must hold an annual meeting of Shareholders during 2020 (the “2020 Annual Meeting”) to hold its 2020 Annual Meeting on any date in 2020 up to and including December 31, 2020. The Exchange continues to expect Issuers to comply with applicable legislation regarding the timing of their 2020 Annual Meeting. The Exchange is extending the timeframe within which Issuers must obtain Shareholder approval of rolling stock option plans. Under Policy 4.4, section 3.9(b) of the Manual, rolling stock option plans generally must receive Shareholder approval at the time the plan is to be implemented and yearly, at the Issuer’s annual meeting. Pursuant to the Temporary Relief, the Exchange is permitting an Issuer to obtain the 2020 yearly Shareholder approval at its 2020 Annual Meeting, which as indicated above may be held on any date in 2020 up to and including December 31, 2020, subject to compliance with applicable legislation. For more information please see: 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. **Categories:** News & Updates --- ### [Mutual Fund Dealers Association of Canada Publishes for Comment Amendments to MFDA Continuing Education Process](https://baxsecuritieslaw.com/mutual-fund-dealers-association-of-canada-publishes-for-comment-amendments-to-mfda-continuing-education-process/) **Published:** March 30, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Mutual Fund Dealers Association of Canada (MFDA) is publishing for a 135 -day comment period proposed amendments to MFDA Policy No. 9 Continuing Education (CE) Requirements (The Amendments). The comment period ends August 10, 2020. The Amendments intend to establish the MFDA’s CE accreditation... **Content:** The Mutual Fund Dealers Association of Canada (MFDA) is publishing for a 135 -day comment period proposed amendments to *MFDA Policy No. 9 Continuing Education (CE) Requirements* (The Amendments). The comment period ends August 10, 2020. The Amendments intend to establish the MFDA’s CE accreditation process including: (a) the entities that can be recognized as accreditors to assess CE activities; (b) the criteria which accreditors must use to evaluate CE activities; and (c) CE eligibility periods. Section V of the MFDA’s notice sets out the process for submitting comments. Once finalized, the Amendments will become effective on a date to be set by the MFDA. *MFDA Policy No. 9 Continuing Education (CE) Requirements* (Request for Comment and Board Resolution) is [available for download](https://www.bcsc.bc.ca/Marketplaces/SRO/MFDA/Request_for_Comment__Proposed_Amendments_to_MFDA_Policy_No__9_(Continuing_Education_(%E2%80%9CCE%E2%80%9D)_Requirements)/) from the websites of the MFDA’s recognizing regulators. 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. **Categories:** News & Updates --- ### [British Columbia Government Declares Capital Markets an Essential Service](https://baxsecuritieslaw.com/british-columbia-government-declares-capital-markets-an-essential-service/) **Published:** March 30, 2020 **Author:** Barbara Hendrickson **Excerpt:** The British Columbia government has declared the capital markets and its regulator, the British Columbia Securities Commission (BCSC), as essential services during the COVID-19 pandemic. In addition to the BCSC, the province has specifically identified the following as part of the capital markets: self-regulatory organizationsexchangesclearing... **Content:** The British Columbia government has declared the capital markets and its regulator, the British Columbia Securities Commission (BCSC), as essential services during the COVID-19 pandemic. In addition to the BCSC, the province has specifically identified the following as part of the capital markets: - self-regulatory organizations - exchanges - clearing agencies - investment-fund dealers, advisers and managers. The BCSC has clarified with the Ministry of Finance that all dealers and advisers, not just those involved with investment funds, are included as essential services. Although these services are allowed to remain open, they must follow the orders and guidance provided by the Provincial Health Officer to ensure safe operations and reduce the risk of transmission of COVID-19. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Adopt CSA Multilateral Notice 24-317, Notice of Relief from Certain Filing Provisions under National Instrument 24-101 Institutional Trade Matching and Settlement](https://baxsecuritieslaw.com/canadian-securities-administrators-adopt-csa-multilateral-notice-24-317-notice-of-relief-from-certain-filing-provisions-under-national-instrument-24-101-institutional-trade-matching-and-settlement/) **Published:** March 30, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Participating Jurisdictions of British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, Nova Scotia, New Brunswick, Prince Edward Island, Newfoundland and Labrador, Nunavut, the Northwest Territories, and Yukon (the Participating Jurisdictions) of the Canadian Securities Administrators (CSA) have adopted CSA Staff Notice 24-317, Notice of Relief from... **Content:** The Participating Jurisdictions of British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, Nova Scotia, New Brunswick, Prince Edward Island, Newfoundland and Labrador, Nunavut, the Northwest Territories, and Yukon (the Participating Jurisdictions) of the Canadian Securities Administrators (CSA) have adopted *CSA Staff Notice 24-317, Notice of Relief from Certain Filing Provisions under National Instrument 24-101 Institutional Trade Matching and Settlement* (the Staff Notice). The Staff Notice grants relief to registered dealers or advisers (registered firms) through a three-year moratorium from the application of section 4.1 of National Instrument 24-101 Institutional Trade Matching and Settlement (NI 24-101). Under the relief, registered firms will not be required to deliver Form 24-101F1 Registered Firm Exception Report of DAP/RAP Trade Reporting and Matching (Form 24-101F1) to the participating jurisdictions beginning on July 1, 2020, and ending on July 1, 2023. The Ontario Securities Commission (OSC) is seeking ministerial approval for amendments to NI 24-101 that would provide harmonized relief (amendments) beginning on July 1, 2020, and ending on July 1, 2023. The CSA and the OSC will coordinate their respective beginning dates and end dates of the amendments. *CSA Staff Notice 24-317, Notice of Relief from Certain Filing Provisions under National Instrument 24-101 Institutional Trade Matching and Settlement* [is available for download](https://www.bcsc.bc.ca/Securities_Law/Policies/Policy2/PDF/24-317__CSA_Multilateral_Notice___March_26__2020/) from the websites of the Participating Jurisdictions. 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. **Categories:** News & Updates --- ### [TSX Venture Exchange Extends Deadline for Payment of Sustaining Fees](https://baxsecuritieslaw.com/tsx-venture-exchange-extends-deadline-for-payment-of-sustaining-fees/) **Published:** March 30, 2020 **Author:** Barbara Hendrickson **Excerpt:** The TSX Venture Exchange (the “Exchange”) is extending the deadline by which Issuers must pay their 2020 annual sustaining fees from March 31, 2020 to May 31, 2020. This is the latest move by the Exchange in response to the COVID-19 pandemic. To provide additional... **Content:** The TSX Venture Exchange (the “Exchange”) is extending the deadline by which Issuers must pay their 2020 annual sustaining fees from March 31, 2020 to May 31, 2020. This is the latest move by the Exchange in response to the COVID-19 pandemic. To provide additional relief to those Issuers who require it, the Exchange will also permit Issuers to pay their 2020 annual sustaining fees in installments, with the first installment of 50% of the annual sustaining fees due on May 31, 2020 and the balance due on July 31, 2020. For more information please see: 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. **Categories:** News & Updates --- ### [BAX Securities Law’s Barbara Hendrickson Quoted in Law Times Article on New Crowdfunding Proposals](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-quoted-in-law-times-article-on-new-crowdfunding-proposals/) **Published:** April 2, 2020 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson, of BAX Securities Law, was prominently quoted in a recent article in the Law Times. The article, “CSA’s equity crowdfunding proposals unlikely to draw more investors: securities lawyers”, by staff writer Luis Mullan, discusses the recent Canadian Securities Administrators (CSA) equity crowdfunding proposals.... **Content:** Barbara Hendrickson, of BAX Securities Law, was prominently quoted in a recent article in the Law Times. The article, “CSA’s equity crowdfunding proposals unlikely to draw more investors: securities lawyers”, by staff writer Luis Mullan, discusses the recent Canadian Securities Administrators (CSA) equity crowdfunding proposals. Barbara Hendrickson, while commending the harmonization efforts, believes that the CSA could have increased the limits. “It’s definitely a step in the right direction,” said Ms. Hendrickson, who is quoted in the article. “The question is whether they have raised the limits for issuers to raise per year enough and whether they’ve raised the limit for investors high enough. Equity crowdfunding is an expensive and highly regulated option, pointed out Hendrickson. “Because under the CSA proposal the amount that individuals can invest is capped at $2,500, it can create a burden on issuers to manage large numbers of investors, added Hendrickson. “It doesn’t make sense to have to raise $1 million and have hundreds of investors,” said Hendrickson. “It’s not practical from a corporate administration point of view. If they really want to give crowdfunding a head start, look at raising it above $1 million. The complete Law Times article can be found: 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. **Categories:** News & Updates --- ### [Ontario Government Issues Emergency Order Regarding Meeting Flexibility](https://baxsecuritieslaw.com/ontario-government-issues-emergency-order-regarding-meeting-flexibility/) **Published:** April 6, 2020 **Author:** Barbara Hendrickson **Excerpt:** In light of the COVID-19 pandemic, the Government of Ontario has acted to support business corporations, not-for-profit corporations, insurers, and share capital social clubs by issuing an Emergency Order (the Emergency Order) to provide flexibility for corporate meetings. The Emergency Order is in effect province-wide... **Content:** In light of the COVID-19 pandemic, the Government of Ontario has acted to support business corporations, not-for-profit corporations, insurers, and share capital social clubs by issuing an Emergency Order (the Emergency Order) to provide flexibility for corporate meetings. The Emergency Order is in effect province-wide and is retroactive to March 17, 2020, the day the Declaration of Emergency came into effect. The ability to hold virtual meetings and the extended timeframe for AGMs applies to corporations under the Ontario Business Corporations Act (OBCA), and the Corporations Act (CA) is set out in the Emergency Order. The Emergency Order will: - Allow all corporations under the Corporations Act and Business Corporations Act to hold meetings of directors, shareholders, and members virtually (i.e., electronically or by telephone). - Extend the timeframe by which corporations under the Corporations Act and Business Corporations Act must hold Annual General Meetings (AGMs) in certain circumstances related to the emergency The Emergency Order [is available for download](https://www.ontario.ca/laws/regulation/r20107) from the website of the Government of Ontario. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish CSA Staff Notice 51-360 Frequently asked Questions Regarding Filing Extension Relief Granted by Way of a Blanket Order in Response to COVID-19](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-csa-staff-notice-51-360-frequently-asked-questions-regarding-filing-extension-relief-granted-by-way-of-a-blanket-order-in-response-to-covid-19/) **Published:** April 6, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published CSA Staff Notice 51-360 Frequently asked Questions Regarding Filing Extension Relief Granted by Way of a Blanket Order in Response to COVID-19 (the Staff Notice). The Staff Notice contains CSA staff’s views on frequently asked questions (FAQs) about... **Content:** The Canadian Securities Administrators (CSA) have published *CSA Staff Notice 51-360 Frequently asked Questions Regarding Filing Extension Relief Granted by Way of a Blanket Order in Response to COVID-19* (the Staff Notice). The Staff Notice contains CSA staff’s views on frequently asked questions (FAQs) about the exemptions from certain corporate finance requirements provided by the CSA that apply to reporting issuers and other issuers that are not investment funds in the blanket orders issued by the Participating Jurisdictions. *CSA Staff Notice 51-360 Frequently asked Questions Regarding Filing Extension Relief Granted by Way of a Blanket Order in Response to COVID-19* [is available for download](https://www.bcsc.bc.ca/Securities_Law/Policies/Policy5/PDF/51-360__CSA_Staff_Notice___April_3__2020/) from the websites of the Participating Jurisdictions. 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. **Categories:** News & Updates --- ### [TSX announces temporary relief of $0.05 Minimum Pricing Requirement](https://baxsecuritieslaw.com/tsx-announces-temporary-relief-of-0-05-minimum-pricing-requirement/) **Published:** April 9, 2020 **Author:** Barbara Hendrickson **Excerpt:** TSX Venture Exchange (the “Exchange”) announced on April 8, 2020 that it is providing notice of further measures in response to the COVID-19 pandemic. Given the current extraordinary ongoing situation, the Exchange will provide temporary relief (the “Temporary Relief”) from certain requirements of the Exchange’s... **Content:** TSX Venture Exchange (the “Exchange”) announced on April 8, 2020 that it is providing notice of further measures in response to the COVID-19 pandemic. Given the current extraordinary ongoing situation, the Exchange will provide temporary relief (the “Temporary Relief”) from certain requirements of the Exchange’s Corporate Finance Manual (the “Manual”) as described in more detail below. **Minimum Price** The minimum price at which Listed Shares may be issued is revised from $0.05 to $0.01 in certain circumstances: - If the Market Price of an Issuer’s Listed Shares is not greater than $0.05, the minimum price at which that Issuer may issue its Listed Shares is equal to that Market Price, subject to a minimum price of $0.01. - If the Market Price of an Issuer’s Listed Shares is greater than $0.05, the minimum price at which that Issuer may issue its Listed Shares remains equal to the Market Price less the existing allowable maximum discounts based on closing price, subject to a minimum price of $0.05. **Private Placement Financings** Under Policy 4.1 – Private Placements of the Manual (“Policy 4.1”), the offering price for a financing involving the issuance of Listed Shares must not be less than the applicable Discounted Market Price, which includes a minimum price of $0.05. Under the Temporary Relief, the minimum offering price is revised from $0.05 to $0.01 in certain circumstances where the Market Price of an Issuer’s Listed Shares is not greater than $0.05. **Shares for Debt** Under Policy 4.3 – *Shares for Debt* of the Manual (“**Policy 4.3**”), the minimum deemed price at which debt may be converted into Listed Shares must not be less than the applicable Discounted Market Price, which includes a minimum price of $0.05. Under the Temporary Relief, the minimum deemed price at which debt may be converted into Listed Shares is revised from $0.05 to $0.01 in certain circumstances where the Market Price of an Issuer’s Listed Shares is not greater than $0.05. **Bonus Shares and Warrants** Under Policy 5.1 – *Loans, Loan Bonuses, Finder’s Fees and Commissions* of the Manual (“**Policy 5.1**”), the calculation of the number of Listed Shares and Warrants that may be issued as a bonus for a loan or guarantee is calculated using the Market Price, which includes a minimum of $0.05. Under the Temporary Relief, that minimum is revised from $0.05 to $0.01 in certain circumstances where the Market Price of an Issuer’s Listed Shares is not greater than $0.05. **NEX Policy** Under the NEX Policy (“**NEX Policy**”), all share issuances are subject to the same price protection mechanisms and pricing policies as would apply to such transactions on the Exchange, including the minimum issuance price of $0.05 for shares. Under the Temporary Relief, that minimum issuance price for any financings and shares for debt transactions is revised from $0.05 to $0.01 in certain circumstances where the Market Price of an Issuer’s Listed Shares is not greater than $0.05. The Temporary Relief will be in effect and apply to Listed Shares that are issued on or before September 30, 2020. For more details on the Temporary Relief please see: 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. **Categories:** News & Updates --- ### [Joint statement by Canadian Securities Administrators and Investment Industry Regulatory Organization of Canada on recent volatility in Canadian equity markets](https://baxsecuritieslaw.com/joint-statement-by-canadian-securities-administrators-and-investment-industry-regulatory-organization-of-canada-on-recent-volatility-in-canadian-equity-markets/) **Published:** April 13, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) issued a joint statement on April 9th, 2020. According to the statement, IIROC’s market monitoring and surveillance functions remain robust, secure and resilient and that over the past several weeks, IIROC... **Content:** The Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) issued a joint statement on April 9th, 2020. According to the statement, IIROC’s market monitoring and surveillance functions remain robust, secure and resilient and that over the past several weeks, IIROC has managed four market-wide circuit breakers and an increased number of single-stock circuit breakers. According to the statement, the CSA and IIROC will continue to monitor developments in other jurisdictions, including decisions by some countries to introduce short selling restrictions. IIROC’s data shows that short selling activity continues to represent a low percentage of total market activity and remains consistent with short selling activity prior to the pandemic. There is no evidence that short selling activity has been the driver of recent market declines. According to the announcement, IIROC is monitoring short selling, and will intervene in instances involving abusive or manipulative trading. Under the market integrity rules and securities legislation, each short sale is required to be marked, and dealers and investors are prohibited from initiating a short sale without the expectation to settle the trade. Dealers must also report short positions and failed trades to IIROC. IIROC publishes a summary of reported short positions, as well as a summary of short sale activity, on its website on a bi-monthly basis. Additionally, IIROC has the ability to declare any security ineligible for short selling if circumstances warrant it. If warranted based on either new information or from analysis, the CSA and IIROC will consider limiting short selling on particular securities. For more details on the announcement please see: [https://www.bcsc.bc.ca/News/News\_Releases/2020/32\_Joint\_statement\_by\_Canadian\_Securities\_Administrators\_and\_Investment\_Industry\_Regulatory\_Organization\_of\_Canada\_on\_recent\_volatility\_in\_Canadian\_equity\_markets/](https://www.bcsc.bc.ca/News/News_Releases/2020/32_Joint_statement_by_Canadian_Securities_Administrators_and_Investment_Industry_Regulatory_Organization_of_Canada_on_recent_volatility_in_Canadian_equity_markets/) 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. **Categories:** News & Updates --- ### [Canadian securities administrators provide update on syndicated mortgage regime](https://baxsecuritieslaw.com/canadian-securities-administrators-provide-update-on-syndicated-mortgage-regime/) **Published:** April 18, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) on April 16, 2020 announced that it is adjusting the timeline to implement changes that will harmonize the regulation of syndicated mortgages across Canada. In December 2019, the CSA published an update on its next steps related to syndicated mortgages, including an... **Content:** The Canadian Securities Administrators (CSA) on April 16, 2020 announced that it is adjusting the timeline to implement changes that will harmonize the regulation of syndicated mortgages across Canada. In December 2019, the CSA published [an update](https://www.osc.gov.on.ca/en/61280.htm) on its next steps related to syndicated mortgages, including an anticipated timeline and effective date. The CSA now anticipate the amendments will take effect January 1, 2021, subject to requisite approvals. Additional details will be communicated later this year. For more details please see: [https://www.bcsc.bc.ca/News/News\_Releases/2020/35\_Canadian\_securities\_administrators\_provide\_update\_on\_syndicated\_mortgage\_regime/](https://www.bcsc.bc.ca/News/News_Releases/2020/35_Canadian_securities_administrators_provide_update_on_syndicated_mortgage_regime/) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403 – 4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators temporarily increase short-term borrowing limits for mutual funds investing in fixed income](https://baxsecuritieslaw.com/canadian-securities-regulators-temporarily-increase-short-term-borrowing-limits-for-mutual-funds-investing-in-fixed-income/) **Published:** April 18, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) announced on April 17, 2020 temporary blanket relief that permits mutual funds to engage in additional short-term borrowing from April 17, 2020 to July 31, 2020. The conditional temporary relief is available to any mutual fund in Canada that invests a portion... **Content:** The Canadian Securities Administrators (CSA) announced on April 17, 2020 temporary blanket relief that permits mutual funds to engage in additional short-term borrowing from April 17, 2020 to July 31, 2020. The conditional temporary relief is available to any mutual fund in Canada that invests a portion of its assets in fixed income securities, including equity funds holding a portion of fixed income securities. Under securities legislation, a mutual fund can engage in temporary borrowing to accommodate redemption requests. However, all borrowings must not exceed five per cent of a fund’s net asset value at the time of borrowing. The CSA is temporarily increasing this limit to 10 per cent to help facilitate a more orderly liquidation of any fixed income securities that might be required to accommodate redemption requests. Mutual funds that engage in additional short-term borrowing provided by this relief must comply with a number of conditions. These include, but are not limited to, ensuring the additional borrowing is in the best interest of all investors, having strict controls around its use, and disclosing the use of any additional borrowing to investors. For more details please see: [https://www.bcsc.bc.ca/News/News\_Releases/2020/36\_Canadian\_securities\_regulators\_temporarily\_increase\_short-term\_borrowing\_limits\_for\_mutual\_funds\_investing\_in\_fixed\_income/](https://www.bcsc.bc.ca/News/News_Releases/2020/36_Canadian_securities_regulators_temporarily_increase_short-term_borrowing_limits_for_mutual_funds_investing_in_fixed_income/) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403 -4606. 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. **Categories:** News & Updates --- ### [CSA Notice 31-357 Blanket Orders/Class Orders in respect of Certain Client Focused Reforms Provisions of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations](https://baxsecuritieslaw.com/csa-notice-31-357-blanket-orders-class-orders-in-respect-of-certain-client-focused-reforms-provisions-of-national-instrument-31-103-registration-requirements-exemptions-and-ongoing-registrant-obligat/) **Published:** April 18, 2020 **Author:** Barbara Hendrickson **Excerpt:** On April 16, 2020, the Canadian Securities Administrators (the CSA) published CSA Notice 31-357 which will allow more time for registered firms and individuals (registrants) to implement certain provisions of the Client Focused Reforms (CFRs). All members of the CSA have issued parallel orders extending... **Content:** On April 16, 2020, the Canadian Securities Administrators (the CSA) published CSA Notice 31-357 which will allow more time for registered firms and individuals (registrants) to implement certain provisions of the Client Focused Reforms (CFRs). All members of the CSA have issued parallel orders extending the timeline for the implementation of amendments to National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations that would otherwise have come into effect in the first phase of the implementation of the CFRs on December 31, 2020. The Investment Industry Regulatory Organization of Canada and the Mutual Fund Dealers Association of Canada (together, the SROs), will harmonize their implementation timelines for conforming changes to their member rules, policies and guidance with the timeline adopted by the CSA. The CSA published the CFRs, which are relevant to all registrants, on October 3, 2019. The CSA provided for a phased transition period, with the reforms relating to conflicts of interest and relationship disclosure information (RDI) provisions taking effect on December 31, 2020, and the remaining reforms taking effect on December 31, 2021. The CSA has postponed the effective date by which registrants will have to comply with the conflicts of interest CFRs by six months to June 30, 2021. The implementation of the RDI CFRs will be postponed until December 31, 2021, so that they will come into effect at the same time as the remaining reforms under the CFRs. The CSA notes that when the conflicts of interest CFRs come into effect on June 30, 2021, registrants will be required to disclose material conflicts of interest to clients before opening an account or in a timely manner after they are identified. Registrants may provide these disclosures separately from any other disclosures using stand-alone documents in any form, be it electronic or paper, that meet the plain language requirements in the conflicts of interest CFRs. Other CFRs All remaining CFRs will take effect on December 31, 2021, consistent with the notice published on October 3, 2019 and the amending instrument for the CFRs. Relief Orders The orders will take effect on December 31, 2020. For more details please see: [https://www.bcsc.bc.ca/Securities\_Law/Policies/Policy3/PDF/31-357\_\_CSA\_Notice\_\_\_April\_16\_\_2020/](https://www.bcsc.bc.ca/Securities_Law/Policies/Policy3/PDF/31-357__CSA_Notice___April_16__2020/) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Staff Notice 51-360 (Updated) Frequently asked questions regarding filing extension relief granted by way of a blanket order in response to COVID-19](https://baxsecuritieslaw.com/csa-staff-notice-51-360-updated-frequently-asked-questions-regarding-filing-extension-relief-granted-by-way-of-a-blanket-order-in-response-to-covid-19/) **Published:** April 19, 2020 **Author:** Barbara Hendrickson **Excerpt:** On April 16, 2020 the Canadian Securities Administrators (CSA) published an update to CSA Staff Notice 51-360 “Frequently asked questions regarding filing extension relief granted by way of a blanket order in response to COVID-19” (CSA Staff Notice) which was first published on April 3,... **Content:** On April 16, 2020 the Canadian Securities Administrators (CSA) published an update to CSA Staff Notice 51-360 “Frequently asked questions regarding filing extension relief granted by way of a blanket order in response to COVID-19” (CSA Staff Notice) which was first published on April 3, 2020. The CSA Staff Notice provided answers to frequently asked questions regarding the harmonized temporary exemptions from certain regulatory filing requirements as a result of COVID-19 which were published on March 23, 2020. The CSA has implemented the relief through local blanket orders that are substantively harmonized across the country. The CSA Staff Notice contains CSA staff’s views on frequently asked questions (FAQs) about the exemptions from certain corporate finance requirements provided by the CSA that apply to reporting issuers and other issuers that are not investment funds in blanket orders including in Ontario “Instrument 51-502 Temporary Exemption from Certain Corporate Finance Requirements. For more details please see: [https://www.bcsc.bc.ca/51-360\_%5BCSA\_Staff\_Notice%5D\_04162020/](https://www.bcsc.bc.ca/51-360_%5BCSA_Staff_Notice%5D_04162020/) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403 – 4606. 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. **Categories:** News & Updates --- ### [OSC temporarily waives all late fees for market participants](https://baxsecuritieslaw.com/osc-temporarily-waives-all-late-fees-for-market-participants/) **Published:** April 19, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has provided temporary relief to market participants by waiving all late fees that accumulate between April 17, 2020 and June 1, 2020. This is estimated to result in over $300,000 of relief to issuers, registrants and insiders during the relief period.  Recently, blanket... **Content:** The Ontario Securities Commission (OSC) has provided [temporary relief](https://www.osc.gov.on.ca/en/covid-19-update.htm#regulatory-relief) to market participants by waiving all late fees that accumulate between April 17, 2020 and June 1, 2020. This is estimated to result in over $300,000 of relief to issuers, registrants and insiders during the relief period. Recently, [blanket exemptive relief](https://www.osc.gov.on.ca/en/covid-19-update.htm#regulatory-relief) was granted by the Canadian Securities Administrators (CSA) to extend filing dates to a variety of market participants impacted by the COVID-19 pandemic. For those that qualify for this relief, no late fee would accrue if the filing was made by the new extended date. Some participants are not eligible or have chosen not to take advantage of the extended filing period. For this reason, the OSC is providing late fee relief by way of a local blanket order, in recognition that all market participants may face some challenges in making fee payments on time during this period. Entities subject to fees under Part 4 of OSC Rule 13-502 *Fees* are not included in the relief as they will not accumulate late fees during this relief period. Market participants must continue to pay fees in accordance with OSC Rule 13-502 *Fees* and OSC Rule 13-503 *(Commodity Futures Act) Fees*. This additional temporary relief will prevent the accumulation of late fees charged under these OSC rules. The OSC blanket orders will come into effect on April 17, 2020 and expire on June 1, 2020. Any additional late fee relief needed for the pandemic period before April 17, 2020 will also be considered. For more details please see: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20200417\_osc-temporarily-waives-all-late-fees-for-market-participants.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20200417_osc-temporarily-waives-all-late-fees-for-market-participants.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403 – 4606. 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. **Categories:** News & Updates --- ### [Canadian Bar Association submission on CSA Consultation Paper 51-405 Consideration of an Access Equals Delivery Model for Reporting Issuers](https://baxsecuritieslaw.com/canadian-bar-association-submission-on-csa-consultation-paper-51-405-consideration-of-an-access-equals-delivery-model-for-reporting-issuers/) **Published:** May 4, 2020 **Author:** Barbara Hendrickson **Excerpt:** On January 9, 2019 the Canadian Securities Administrator (CSA) including the Ontario Securities Commission (OSC) published a consultation paper ‘Consideration of an Access Equals Delivery Model for Non-Investment Fund Reporting Issuers’ (the Consultation Paper) to provide a forum for discussion on the appropriateness of an access... **Content:** On January 9, 2019 the Canadian Securities Administrator (CSA) including the Ontario Securities Commission (OSC) published a consultation paper ‘Consideration of an Access Equals Delivery Model for Non-Investment Fund Reporting Issuers’ (the **Consultation Paper**) to provide a forum for discussion on the appropriateness of an access equals delivery model in the Canadian market. The CSA was looking for data and information to evaluate the effects of an access equals delivery model on capital formation and investor protection. They sought comments on whether and how such a model may affect investor engagement, positively and negatively, including whether it constitutes an efficient way for investors to access information. The Consultation Paper was published for a 60-day comment period. The Business Law Section of the Canadian Bar Association submitted comments on the Consultation Paper in March 2020 – ‘Access Equals Delivery Model for Prospectuses and Other Documents.’ For a copy of the Canadian Bar Association submission please see: [http://](http://www.cba.org/CMSPages/GetFile.aspx?guid=57dd7f08-26fd-444c-af36-9ddd5a679bcc)[www.cba.org](http://www.cba.org/CMSPages/GetFile.aspx?guid=57dd7f08-26fd-444c-af36-9ddd5a679bcc)[/CMSPages/GetFile.aspx?guid=57dd7f08-26fd-444c-af36-9ddd5a679bcc](http://www.cba.org/CMSPages/GetFile.aspx?guid=57dd7f08-26fd-444c-af36-9ddd5a679bcc) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403 – 4606. 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. **Categories:** News & Updates --- ### [CSA Staff Notice 51-360 (Updated) Frequently asked questions regarding filing extension relief granted by way of a blanket order in response to COVID-19](https://baxsecuritieslaw.com/csa-staff-notice-51-360-updated-frequently-asked-questions-regarding-filing-extension-relief-granted-by-way-of-a-blanket-order-in-response-to-covid-19-2/) **Published:** May 4, 2020 **Author:** Barbara Hendrickson **Excerpt:** On May 1st, 2020 the Canadian Securities Administrators (“CSA”) published an update to the CSA staff’s views on frequently asked questions (FAQs) about the exemptions from certain corporate finance requirements provided by the CSA that apply to reporting issuers and other issuers that are not... **Content:** On May 1st, 2020 the Canadian Securities Administrators (“CSA”) published an update to the CSA staff’s views on frequently asked questions (FAQs) about the exemptions from certain corporate finance requirements provided by the CSA that apply to reporting issuers and other issuers that are not investment funds that was first published on March 23, 2020. The CSA published substantively harmonized temporary exemptions from certain regulatory filing requirements as a result of COVID-19. The CSA has implemented the relief through local blanket orders that are substantively harmonized across the country. In Ontario those exemptions are found in in Ontario “Instrument 51-502 Temporary Exemption from Certain Corporate Finance Requirements. For more details please see: [https://www.bcsc.bc.ca/51-360\_%5BCSA\_Staff\_Notice%5D\_04162020/](https://www.bcsc.bc.ca/51-360_%5BCSA_Staff_Notice%5D_04162020/) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403 – 4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators provide temporary relief to public companies with delayed annual meetings due to COVID-19](https://baxsecuritieslaw.com/canadian-securities-regulators-provide-temporary-relief-to-public-companies-with-delayed-annual-meetings-due-to-covid-19/) **Published:** May 4, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) announced on May 1, 2020 it is providing public companies with temporary blanket relief from certain filing and delivery requirements, which are generally tied to the sending of materials for annual general meetings (AGMs) of public companies. Ontario Instrument 51-504 ‘Temporary Exemptions... **Content:** The Canadian Securities Administrators (CSA) announced on May 1, 2020 it is providing public companies with temporary [blanket relief](https://www.osc.gov.on.ca/en/SecuritiesLaw_sn_20200501_51-504_general-order-temporary-exemptions-securityholder-materials.htm) from certain filing and delivery requirements, which are generally tied to the sending of materials for annual general meetings (AGMs) of public companies. Ontario Instrument 51-504 ‘Temporary Exemptions from Certain Requirements to File or Send Securityholder Materials’ provides this relief in Ontario. The CSA is giving public companies until December 31, 2020 to file their executive compensation disclosure. The CSA is also providing companies with temporary relief from the requirements to send, or send upon request, copies of their annual or interim financial statements and management’s discussion and analysis (MD&A) to investors within certain time periods. Under securities legislation, public companies must meet several deadlines tied to sending investors a management information circular for their AGM. These include requirements to file executive compensation disclosure within 140 days (non-venture companies) or 180 days (venture companies) of their year end. Additionally, public companies that have not sent an annual request form must, within 140 days of their year end, send copies of their annual financial statements and MD&A. Upon request, public companies must also send copies of their annual or interim financial statements and MD&A to investors. The CSA is implementing the relief through local blanket orders that are substantially harmonized across the country. Companies that intend to delay filing their executive compensation disclosure must first issue a news release disclosing that they intend to do so and should consult the blanket orders to ensure that they comply with the conditions for the relief. Companies are expected to provide investors with sufficient lead time to review executive compensation disclosure before their AGM. For more details please see: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20200501\_csa-provide-temporary-relief-public-companies-delayed-annual-meetings-covid-19.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20200501_csa-provide-temporary-relief-public-companies-delayed-annual-meetings-covid-19.htm). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403 – 4606. 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. **Categories:** News & Updates --- ### [Temporary relief from certain regulatory filings available to investment funds and non-investment fund issuers due to COVID-19](https://baxsecuritieslaw.com/temporary-relief-from-certain-regulatory-filings-available-to-investment-funds-and-non-investment-fund-issuers-due-to-covid-19/) **Published:** May 22, 2020 **Author:** Barbara Hendrickson **Excerpt:** Toronto – The Canadian Securities Administrators (CSA) published on May 20, 2020 blanket orders that provide investment funds and non-investment fund issuers with temporary relief from certain regulatory filings and delivery obligations, as a result of the COVID-19 pandemic. The conditions of the relief are substantially the same... **Content:** **Toronto** – The Canadian Securities Administrators (CSA) published on May 20, 2020 blanket orders that provide investment funds and non-investment fund issuers with temporary relief from certain regulatory filings and delivery obligations, as a result of the COVID-19 pandemic. The conditions of the relief are substantially the same relief as was announced on March 23, 2020 prior relief), but the relief is only applicable to issuers and investment funds with filing deadlines in the periods described below. For investment funds, the blanket relied provides a 60-day extension for certain filing, delivery and prospectus renewal obligations normally required to be made during the period from June 2, 2020 to September 30, 2020. For non-investment fund issuers, the blanket relief provides a 45-day extension for certain filing, delivery and base shelf prospectus renewal obligations normally due or required to be made during the period from June 2, 2020 to August 31, 2020. Investment funds and non-investment fund issuers that have already used the prior relief to extend any filing, delivery and prospectus renewal deadline occurring on or before June 1, 2020 cannot use this relief to further extend the deadline. Additionally, to rely on the relief, non-investment fund issuers must issue a news release before the required filing deadline and comply with other conditions. Issuers and their counsel are encouraged to review the respective orders to ensure compliance with these conditions. CSA members will consider applications for a management cease trade order (MCTO) by non-investment fund issuers that took advantage of the prior relief and are unable to comply with their filing or delivery obligations by their extended deadline, but anticipate being able to comply shortly thereafter. CSA members will likely reduce the usual period of an MCTO to take into account the 45-day extension. An MCTO restricts certain officers and directors from trading and may be issued by a regulator instead of a failure-to-file cease trade order. Conditions for granting an MCTO are provided in National Policy 12-203 *Management Cease Trade Orders* (NP 12-203). If an MCTO is issued, the issuer must comply with alternative information guidelines, as provided in NP 12-203, until the required documents are filed. For more details please see: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20200520\_csa-relief-regulatory-filings-investment-funds-non-investment-fund-issuers-covid-19.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20200520_csa-relief-regulatory-filings-investment-funds-non-investment-fund-issuers-covid-19.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403 – 4606. 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. **Categories:** News & Updates --- ### [CSA Staff Notice 51-360 (Updated) Frequently asked questions regarding filing extension relief granted by way of a blanket order in response to COVID-19](https://baxsecuritieslaw.com/csa-staff-notice-51-360-updated-frequently-asked-questions-regarding-filing-extension-relief-granted-by-way-of-a-blanket-order-in-response-to-covid-19-3/) **Published:** May 22, 2020 **Author:** Barbara Hendrickson **Excerpt:** First Published April 3, 2020; Updated April 16, 2020, May 1, 2020 and May 13, 2020 On May 13, 2020 the Canadian Securities Administrators (“CSA”) published an update to the CSA staff’s views on frequently asked questions (FAQs) about the exemptions from certain corporate finance... **Content:** *First Published April 3, 2020; Updated April 16, 2020, May 1, 2020 and May 13, 2020* On May 13, 2020 the Canadian Securities Administrators (“CSA”) published an update to the CSA staff’s views on frequently asked questions (FAQs) about the exemptions from certain corporate finance requirements provided by the CSA that apply to reporting issuers and other issuers that are not investment funds that was first published on March 23, 2020. The CSA published substantively harmonized temporary exemptions from certain regulatory filing requirements as a result of COVID-19. The CSA has implemented the relief through local blanket orders that are substantively harmonized across the country. In Ontario those exemptions are found in in Ontario “Instrument 51-502 Temporary Exemption from Certain Corporate Finance Requirements. For more details please see: [https://www.osc.gov.on.ca/documents/en/Securities-Category5/csa\_20200513\_51-360\_frequently-asked-questions-regarding-filing-extension-covid-19.pdf](https://www.osc.gov.on.ca/documents/en/Securities-Category5/csa_20200513_51-360_frequently-asked-questions-regarding-filing-extension-covid-19.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403 – 4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Implement Mandatory Debt Market Transparency](https://baxsecuritieslaw.com/canadian-securities-administrators-implement-mandatory-debt-market-transparency/) **Published:** June 8, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) recently finalized and expanded the mandatory transparency requirements (the transparency requirements) regarding for government debt securities and corporate debt securities. These changes amend National Instrument 21-101 Marketplace Operation and its related Companion Policy (together, NI -21-101). With these changes, information... **Content:** The Canadian Securities Administrators (CSA) recently finalized and expanded the mandatory transparency requirements (the transparency requirements) regarding for government debt securities and corporate debt securities. These changes amend *National Instrument 21-101 Marketplace Operation* and its related Companion Policy (together, NI -21-101). With these changes, information about trades in corporate and government debt securities will be publicly available and disseminated by the Investment Industry Regulatory Organization of Canada (IIROC), the information processor (IP). IROC is currently the IP for corporate debt securities, and the CSA will be expanding its mandate to include government debt securities. - The implementation of the transparency requirements will begin August 31, 2020, with the distribution of post-trade information for trades in government debt securities executed by dealers that are currently subject to IIROC Rule 2800C and banks that are already reporting their corporate and government debt securities to IIROC, as well as their existing post-trade information for corporate debt securities. - Starting May 31, 2021, the transparency requirements will require information to be disseminated regarding corporate and government debt transactions executed by those banks that do not currently report any transactions to IIROC. Provided all ministerial approvals are obtained, the amendments will come into force on August 31, 2020. The amendments are available for download from the websites of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [OSC continues to temporarily waive late fees for market participants due to COVID-19](https://baxsecuritieslaw.com/osc-continues-to-temporarily-waive-late-fees-for-market-participants-due-to-covid-19/) **Published:** June 8, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) announced on May 29, 2020 that it will continue to temporarily waive late fees for market participants impacted by the COVID-19 pandemic. The extensions build on the temporary relief the on April 17, 2020. Late fees will be waived for... **Content:** The Ontario Securities Commission (OSC) announced on May 29, 2020 that it will continue to temporarily waive late fees for market participants impacted by the COVID-19 pandemic. The extensions build on the temporary relief the on April 17, 2020. Late fees will be waived for investment funds, registrants, and firms that rely on certain registration exemptions in Ontario, that accumulate between June 2, 2020 and September 30, 2020. For issuers and regulated entities, including marketplaces, clearing agencies and trade repositories, late fees that accumulate between June 2, 2020 and August 31, 2020 will be waived. Market participants must pay fees in accordance with OSC Rule 13-502 *Fees* and OSC Rule 13-503 *(Commodity Futures Act) Fees*. This additional temporary relief will prevent the accumulation of certain late fees charged under these OSC rules. The OSC blanket order will come into effect on orders can be found on the OSC website: [https://www.osc.gov.on.ca/en/SecuritiesLaw\_rule\_20200529\_13-506\_general-order-accrual-of-late-fees.htm](https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20200529_13-506_general-order-accrual-of-late-fees.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators reinforce disclosure expectations for mining issuers’ mineral resource estimates](https://baxsecuritieslaw.com/canadian-securities-regulators-reinforce-disclosure-expectations-for-mining-issuers-mineral-resource-estimates/) **Published:** June 8, 2020 **Author:** Barbara Hendrickson **Excerpt:** On June 4, 2020, the Canadian Securities Administrators (CSA) released a notice that summarizes the results of a review on the mineral resource estimates disclosed in mining issuers’ technical reports under National Instrument 43-101 Standards of Disclosure for Mineral Projects. The notice explains how regulators assess... **Content:** On June 4, 2020, the Canadian Securities Administrators (CSA) released a notice that summarizes the results of a review on the mineral resource estimates disclosed in mining issuers’ technical reports under National Instrument 43-101 *Standards of Disclosure for Mineral Projects*. The notice explains how regulators assess mineral resource estimates and provides guidance to assist issuers on addressing common deficiencies. CSA Staff reviewed the disclosure of mineral resource estimates in 86 technical reports to assess compliance with securities regulatory requirements and for conformance to the Canadian Institute of Mining, Metallurgy and Petroleum(CIM) best practices guidelines. The review found that most disclosure on mineral resource estimates was satisfactory. Some mining issuers need to improve their mineral resource estimate disclosure in the following areas: - **Reasonable prospects of eventual economic extraction: improving descriptions of the different technical and economic assumptions used to determine that the estimated mineralized material has the potential to be mined and processed economically; - **Data verification:** ensuring data used to support a mineral resource estimate is adequately verified and determined suitable by the qualified person; - **Reporting results, sensitivities, risks and uncertainties: enhancing disclosure about potential risks and uncertainties specific to the mining project. Many technical reports only provided boilerplate disclosure and omitting risks specific to of the mineral resource estimate could be misleading. The notice can be found on the Ontario Securities Commission (OSC) website: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20200604\_csa-reinforce-disclosure-expectations-mining-issuers-mineral-resource-estimates.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20200604_csa-reinforce-disclosure-expectations-mining-issuers-mineral-resource-estimates.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators remind issuers of importance of disclosure in financial reporting](https://baxsecuritieslaw.com/canadian-securities-regulators-remind-issuers-of-importance-of-disclosure-in-financial-reporting/) **Published:** June 8, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) released a notice on May 29, 2020 reminding reporting issuers of the importance of disclosing high quality financial information to investors. The CSA encourages issuers to visit the CSA COVID-19 Information Hub for further guidance and information, including COVID-19: Continuous Disclosure Obligations and... **Content:** The Canadian Securities Administrators (CSA) released a notice on May 29, 2020 reminding reporting issuers of the importance of disclosing high quality financial information to investors. The CSA encourages issuers to visit the [CSA COVID-19 Information Hub](https://www.securities-administrators.ca/aboutcsa.aspx?id=1885) for further guidance and information, including [COVID-19: Continuous Disclosure Obligations and Considerations for Issuers](https://www.securities-administrators.ca/uploadedFiles/General/pdfs/COVID-19_Continuous_Disclosure_Obligations_and_Considerations_for_Issuers.pdf) that discusses a number of important issues, and to consider this information when preparing financial reports and other disclosure documents. The CSA notice also refers to the International Organization of Securities Commissions (IOSCO) issued [IOSCO Statement on Importance of Disclosure about COVID-19](https://www.iosco.org/library/pubdocs/pdf/IOSCOPD655.pdf) to highlight financial reporting issues that should be considered by reporting issuers in order to provide investors with relevant and reliable information in their financial reports and related disclosure documents. The CSA and the Ontario Securities Commission (OSC) supports the IOSCO Statement. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Temporary relief from certain regulatory filings available to registrants and unregistered capital markets participants due to COVID-19](https://baxsecuritieslaw.com/temporary-relief-from-certain-regulatory-filings-available-to-registrants-and-unregistered-capital-markets-participants-due-to-covid-19/) **Published:** June 8, 2020 **Author:** Barbara Hendrickson **Excerpt:** The securities regulatory authorities in Alberta, British Columbia, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island, Saskatchewan and Yukon (the participating jurisdictions) published on May 29, 2020 temporary blanket relief for registrants and unregistered capital markets participants from certain financial... **Content:** The securities regulatory authorities in Alberta, British Columbia, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island, Saskatchewan and Yukon (the participating jurisdictions) published on May 29, 2020 temporary blanket relief for registrants and unregistered capital markets participants from certain financial statement and information delivery requirements, as a result of COVID-19. The conditions of the relief are substantially the same as the temporary relief announced on March 23, 2020 (prior relief), but the relief is only applicable to registrants and unregistered capital markets participants with filing deadlines in the periods described below. The blanket relief provides a 60-day extension for periodic filings normally required to be made between June 2, 2020 and September 30, 2020 by registrants and, in Ontario, unregistered capital markets participants that rely upon certain registration exemptions. These unregistered capital markets participants include unregistered investment fund managers and unregistered exempt international firms. Registrants and unregistered capital markets participants that have already used the prior relief to extend their deadline for any financial statement or information delivery requirements occurring on or before June 1, 2020, cannot use this relief to further extend that deadline. Registrants who are registered in multiple jurisdictions will need to ensure that they satisfy the applicable filing deadlines in those jurisdictions where the relief does not apply. The Ontario Securities Commission (OSC) is implementing the relief through a local blanket order: [https://www.osc.gov.on.ca/en/SecuritiesLaw\_rule\_20200528\_31-513\_notice-temporary-exemption-certain-financial-statement.htm](https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20200528_31-513_notice-temporary-exemption-certain-financial-statement.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators streamline at-the-market distribution regime](https://baxsecuritieslaw.com/canadian-securities-regulators-streamline-at-the-market-distribution-regime/) **Published:** June 8, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators published on June 4, 2020 final amendments that streamline at-the-market (ATM) distributions in Canada, and reduce regulatory burden for issuers, exchanges and investment dealers. ATM distributions will now be available to issuers without having to incur the time and cost of applying for... **Content:** The Canadian Securities Administrators published on June 4, 2020 final amendments that streamline at-the-market (ATM) distributions in Canada, and reduce regulatory burden for issuers, exchanges and investment dealers. ATM distributions will now be available to issuers without having to incur the time and cost of applying for exemptive relief to conduct such distributions. Provided all necessary Ministerial approvals are obtained, the amendments will become effective on August 31, 2020. Stakeholders identified ATM distributions as a recommended area of focus in the CSA’s consultation on reducing regulatory burden for non-investment fund issuers. In response, the CSA initiated a policy project relating to ATM distributions, leading to the publication of proposals for comment on May 9, 2019. The Ontario Securities Commission’s (OSC) Notice of Amendments to National Instrument 44-102 *Shelf Distributions* and its related companion policyis available on its’ websites. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators make it easier for portfolio managers to use client relationship management specialists](https://baxsecuritieslaw.com/canadian-securities-regulators-make-it-easier-for-portfolio-managers-to-use-client-relationship-management-specialists/) **Published:** June 11, 2020 **Author:** Barbara Hendrickson **Excerpt:** On June 10, 2010 the Canadian Securities Administrators (CSA) announced steps to facilitate portfolio managers’ use of client relationship management specialists. These actions aim to better align the CSA’s assessment of relevant investment management experience with portfolio managers’ evolving business models. Many portfolio managers now... **Content:** On June 10, 2010 the Canadian Securities Administrators (CSA) announced steps to facilitate portfolio managers’ use of client relationship management specialists. These actions aim to better align the CSA’s assessment of relevant investment management experience with portfolio managers’ evolving business models. Many portfolio managers now have an operating model that divides responsibilities between specialized client relationship managers and stock-picking teams. To keep pace with this development, the CSA is updating its practice of requiring all advising representatives to have stock-picking expertise. Effective immediately, when a portfolio manager sponsors an individual for registration as an advising representative, the portfolio manager may identify the applicant as a client relationship management specialist whose advice to clients will not include stock-picking. The CSA will impose terms and conditions on client relationship management specialists registered as advising representatives, which will prohibit them from providing stock-picking advice. They will also be required to tell clients about the limits of the advice they can give. The CSA is not making any changes to proficiency requirements. Standard conditions on client relationship managers’ registration as advising representatives will require them to take steps to ensure that clients understand the different roles of the members of the specialized teams that serve them. The CSA will monitor and review the experience of portfolio managers that choose to operate with registered client relationship management specialists. This exercise may lead to further changes designed to formalize a permanent accommodation for client relationship management specialists. The notice can be found at: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20200610\_csa-make-it-easier-portfolio-managers-client-relationship-management.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20200610_csa-make-it-easier-portfolio-managers-client-relationship-management.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [IIROC calls for consolidation of self-regulators](https://baxsecuritieslaw.com/iiroc-calls-for-consolidation-of-self-regulators/) **Published:** June 11, 2020 **Author:** Barbara Hendrickson **Excerpt:** On June 9, 2020 the Investment Industry Regulatory Organization of Canada (IIROC) released its proposal, "Improving Self-Regulation for Canadians", outlining the benefits of bringing together IIROC and the Mutual Fund Dealers Association of Canada (MFDA) as divisions of a consolidated self-regulatory organization (SRO). In the... **Content:** On June 9, 2020 the Investment Industry Regulatory Organization of Canada (IIROC) released its proposal, “Improving Self-Regulation for Canadians”, outlining the benefits of bringing together IIROC and the Mutual Fund Dealers Association of Canada (MFDA) as divisions of a consolidated self-regulatory organization (SRO). In the view of IIROC benefits would include enhanced investor protection and access to advice, and a significant reduction in overlapping regulatory burden and red tape. IIROC developed its proposal after dialogue with a diverse number of stakeholders including investors, investment and mutual fund dealers and advisors, professional bodies and industry associations. IIROC’s objective was to ensure that any proposal recommended to the Canadian Securities Administrators (CSA) in its upcoming review of the investment industry SROs must: • Be positive for investors, regardless of where they live or how many assets they have; • Enhance investor protection; • Have a positive impact on dealers’ and registrants’ ability to serve Canadians, Have a positive impact on dealers’ and registrants’ ability to serve Canadians, regardless of size or business model; • Reduce duplicative regulatory burden; • Be straightforward, simple and inexpensive to execute, with minimal disruption to Canadians, the industry, or the CSA oversight regime; and • Position the SRO model for continued policy streamlining and evolution. According to IIROC its proposal can be implemented within three months, within a year of approval from the CSA. For more details of the IIROC proposal: [https://www.iiroc.ca/Documents/2020/IIROC\_consolidation\_FNL.pdf](https://www.iiroc.ca/Documents/2020/IIROC_consolidation_FNL.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Fiscal Year 2019/20 Enforcement Report](https://baxsecuritieslaw.com/csa-fiscal-year-2019-20-enforcement-report/) **Published:** June 24, 2020 **Author:** Barbara Hendrickson **Excerpt:** On June 23, 2020, the Canadian Securities Administrators (CSA) released its fiscal year 2019/20 Enforcement Report which outlines how securities regulators are protecting investors and the integrity of Canada’s capital markets. Highlights from the fiscal year 2019/20 Enforcement Report include: 66 Investor Alerts were issued to... **Content:** On June 23, 2020, the Canadian Securities Administrators (CSA) released its fiscal year 2019/20 Enforcement Report which outlines how securities regulators are protecting investors and the integrity of Canada’s capital markets. Highlights from the fiscal year 2019/20 Enforcement Report include: - 66 Investor Alerts were issued to warn the public about possible investment scams; - 65 individuals were banned from participating in the capital markets; - 95 interim cease-trade and asset-freeze orders were issued; - Four individuals received a combined total of 18 years and 11 months years of jail time through regulators’ support of Criminal Code case investigations; - 23 fraud cases were concluded, resulting in over $3 million in penalties; and - 291 whistleblower tips were received. The report can be found at: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20200623\_csa\_fiscal-year-enforcement-report.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20200623_csa_fiscal-year-enforcement-report.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [OSC publishes investigative report of QuadrigaCX](https://baxsecuritieslaw.com/osc-publishes-investigative-report-of-quadrigacx/) **Published:** June 24, 2020 **Author:** Barbara Hendrickson **Excerpt:** On June 11, 2020 the Ontario Securities Commission (OSC) published report on a review conducted OSC Staff, of the crypto asset trading platform QuadrigaCX (Quadriga). The collapse of Quadriga in 2019 caused massive losses for 76,000 investors from Canada and around the world, who collectively... **Content:** On June 11, 2020 the Ontario Securities Commission (OSC) published report on a review conducted OSC Staff, of the crypto asset trading platform QuadrigaCX (Quadriga). The collapse of Quadriga in 2019 caused massive losses for 76,000 investors from Canada and around the world, who collectively lost at least $169 million. Approximately 40 per cent of these investors were Ontarians. The report outlines the events from Quadriga’s inception to its eventual collapse. Over a 10-month period, a multi-disciplinary team under the direction of OSC Enforcement Staff analyzed trading and blockchain data, interviewed key witnesses, and collaborated with numerous regulatory bodies in Canada and abroad. OSC Staff analyzed records from third-party payment processors and banks to reconstruct the platform’s affairs. OSC Staff also analyzed platform data relating to more than 368,000 client accounts and over six million individual transactions, as well as thousands of Quadriga-related emails. Staff determined that Quadriga collapsed due to a fraud committed by Cotten. Cotten opened accounts under aliases and credited himself with fictitious currency and crypto asset balances, which he traded with unsuspecting Quadriga clients. Cotten sustained real losses when the price of crypto assets changed, thereby creating a shortfall in assets available to satisfy client withdrawals. Cotten covered this shortfall with other clients’ deposits – in effect, operating a Ponzi scheme. Staff calculated that the bulk of the $169 million in client losses – approximately $115 million – arose from Cotten’s fraudulent trading. Staff also determined that Cotten misappropriated millions in client assets. The report can be found at: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20200611\_osc-publishes-investigative-report-quadrigacx.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20200611_osc-publishes-investigative-report-quadrigacx.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators release interim report on the CSA 2019-2022 Business Plan](https://baxsecuritieslaw.com/canadian-securities-regulators-release-interim-report-on-the-csa-2019-2022-business-plan/) **Published:** July 2, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) on June 30, 20 released an interim progress reports on initiatives published in its CSA 2019-2022 Business Plan, which sets out the priorities of its members over the course of the next three-year period. The progress report provides an update... **Content:** The Canadian Securities Administrators (CSA) on June 30, 20 released an interim progress reports on initiatives published in its CSA 2019-2022 Business Plan, which sets out the priorities of its members over the course of the next three-year period. The progress report provides an update to Canadian investors and market participants on work set out by CSA members in June of last year, highlights achievements outside of the Business Plan, and outlines upcoming policy initiatives. In April 2020 the CSA announced a publication halt for all regulatory work until May 30, 2020 because of the challenges faced by investors and market participants during the COVID-19 pandemic,. In addition, CSA members provided a range of regulatory relief and guidance to various market participants so they could free up resources to focus on front-line activities and investors’ needs. Some highlights in the first year of the Business Plan include the: - Publication in final form of rule amendments to implement the Client Focused Reforms; - Publication in final form by participating members of rule amendments that prohibit mutual and other investment funds from paying upfront sales commissions to dealers, which would lead to the end of or restrictions on deferred sales charges; - Continuation of a broad ranging reform to lighten regulatory burden for all market participants. The report also outlines the policy initiatives for the next year to give market participants additional time to prepare for upcoming regulatory changes and consultations. While the initiatives of the Business Plan remain fundamental to CSA members’ work, the CSA is prepared to continue to address new issues and challenges presented by evolving capital market conditions. The CSA will also continue to monitor emerging trends and international developments in areas that fall within our mandate to determine whether any new initiatives are appropriate. The report can be found at: [interim progress report](https://www.securities-administrators.ca/aboutcsa.aspx?ID=1162) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Consultation Paper 25-402: Consultation on the Self-Regulatory Organization Framework](https://baxsecuritieslaw.com/csa-consultation-paper-25-402-consultation-on-the-self-regulatory-organization-framework/) **Published:** July 2, 2020 **Author:** Barbara Hendrickson **Excerpt:** Read the article here. **Content:** **[Read the article here](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2020/07/25402-CSA-Consultation-Paper-June-25-2020.pdf)**. **Categories:** News & Updates --- ### [Canadian securities regulators introduce guidance for flexible chief compliance officer arrangements for businesses](https://baxsecuritieslaw.com/canadian-securities-regulators-introduce-guidance-for-flexible-chief-compliance-officer-arrangements-for-businesses/) **Published:** July 6, 2020 **Author:** Barbara Hendrickson **Excerpt:** July 2, 2020 staff of the Canadian Securities Administrators (CSA) issued a notice (Notice) setting out guidance regarding the registration requirements for chief compliance officers (CCOs) under National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) for certain Chief Compliance Officer models.... **Content:** July 2, 2020 staff of the Canadian Securities Administrators (CSA) issued a notice (Notice) setting out guidance regarding the registration requirements for chief compliance officers (CCOs) under National Instrument 31-103 *Registration Requirements, Exemptions and Ongoing Registrant Obligations* (NI 31-103) for certain Chief Compliance Officer models. The Notice provide guidance on the three CCO models: 1\) an individual applying to be the CCO for more than one firm (the shared CCO model); 2\) a firm applying to have multiple CCOs, each responsible for one or more business lines and/or different registration categories within the firm (the multiple CCO model); and 3\) an individual applying to be the CCO of a non-traditional or specialized firm, such as a fintech firm, where industry-specific experience may be considered as relevant experience for the purposes of assessing the individual’s proficiency (the specialized CCO model). **Shared CCO Model** Under this model, an individual can act as the CCO for more than one firm. Currently, some affiliated firms have been approved to use a shared CCO model. The Notice states that CSA Staff are open to the possibility of unaffiliated firms using a shared CCO model as well. However, for some smaller firms, a shared CCO may suffice. The shared CCO model may also allow firms with only one individual to separate the role and function of the CCO from that of the UDP and sole director. In reviewing an application by a firm to designate as CCO an individual who holds that position with another firm, OSC staff will consider the following factors: Proficiency: The shared CCO must be able to demonstrate they have the proficiency to act as CCO for each firm’s business. Typically, before an individual could be approved as a CCO in a shared model, the individual would have to have had prior experience as a CCO. Conflicts of Interest: The shared CCO, and the firms sponsoring such applicant, must be able to identify, and appropriately respond to, the existing or potential conflicts of interest resulting from the shared CCO model. Confidentiality: The shared CCO, and the firms sponsoring such applicant, must be able to demonstrate that they will be able to continue to meet their obligations to protect the confidential information of clients. Capacity: The shared CCO must be able to demonstrate their capacity to act as a CCO for more than one registered firm. Effective Compliance System: Firms that make use of a shared CCO must continue to comply with their obligation under section 11.1 of NI 31-103 to maintain an effective compliance system. According to the Notice the shared CCO model does not contemplate a registered firm outsourcing its CCO’s responsibilities to a third-party service provider. An individual acting as CCO of a registered firm must still be an officer, partner or sole proprieter of the registered firm, and a firm may choice to structure its affairs such that the CCO is either an employee or independent contractor of the firm. **Multiple CCO Model** Under this model, and with the necessary exemptive relief to permit it, a firm can designate multiple CCOs with each CCO responsible for one or more registration categories and/or business lines within the firm. For example, a firm that is registered as an investment fund manager, portfolio manager and exempt market dealer may apply to have three CCOs, one for each of the firm’s three registration categories. **Specialized CCO Model** Under this model, where an individual applies to be the CCO of a non-traditional or specialized firm, staff may consider the individual’s business experience when assessing proficiency and experience requirements. The experience demonstrated by the individual being considered for the CCO position should be relevant for both the category of registration and the business of the firm sponsoring the individual. Other business experience may be considered relevant for the purposes of assessing whether the individual meets the experience requirements set out for a CCO in NI 31-103 when a firm applying for registration demonstrates that it is engaged in a non-traditional or specialized business. An individual may be considered proficient to be the CCO under the specialized CCO model but may not be considered proficient to be the CCO of a registered firm with a different business model. In these cases, CSA staff may recommend terms and conditions on the CCO’s registration to this effect. Registrants are inviting to reach out to CSA registration staff if they: · would like to discuss how any of these models might be relevant to them, · wish to combine two or more of the models above with respect to one firm, or · identify other related models, as similar considerations may apply. All applications will be reviewed by CSA Staff on a case by case basis. CSA Staff ask that all comments be provided on the Notice by e-mail to 31-358@acvm-csa.ca on or before September 30, 2020. The report can be found at: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20200702\_csa-introduce-guidance-chief-compliance-officer-arrangements-businesses.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20200702_csa-introduce-guidance-chief-compliance-officer-arrangements-businesses.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish IIROC Oversight Report](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-iiroc-oversight-report/) **Published:** August 11, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) recently published their Oversight Report (the Report) regarding the Investment Industry Regulatory Organization of Canada (IIROC). The report, written by CSA staff, looks at whether IIROC has complied with the terms and conditions of its Recognition Orders, and whether specific... **Content:** The Canadian Securities Administrators (CSA) recently published their Oversight Report (the Report) regarding the Investment Industry Regulatory Organization of Canada (IIROC). The report, written by CSA staff, looks at whether IIROC has complied with the terms and conditions of its Recognition Orders, and whether specific regulatory processes are effective, efficient and applied consistently and fairly. No findings were made and CSA staff note that IIROC has made sufficient progress in resolving findings cited in previous oversight reports. Based on the annual risk-based assessment, CSA staff identified and focused their review on two areas within IIROC’s Enforcement function. These include reviewing the functionalities and capabilities of IIROC’s new Integrated Case Management (ICM) system, which integrates workflow processes of certain key departments, and the written criteria for determining when it is appropriate to have a closed hearing. As part of the report, CSA staff set out two expectations for IIROC. IIROC has been asked to complete a comprehensive review of user access to the ICM system and make improvements where appropriate. CSA staff have also asked IIROC to enhance training for hearing panel members and update its policies and procedures for determining when it is appropriate to hold disciplinary hearings that are closed to the public. The complete report [is available for download](https://www.osc.gov.on.ca/documents/en/Marketplaces/sro-iiroc_20200805_oversight-rev-rpt-investment.pdf) from the websites of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish Final Amendments to Syndicated Mortgage Regime](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-final-amendments-to-syndicated-mortgage-regime/) **Published:** August 11, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) recently published final amendments that substantially harmonize the regulatory framework for syndicated mortgages in Canada. These final amendments will: remove the prospectus and registration exemptions that currently apply to syndicated mortgages in certain jurisdictions to substantially harmonize the regulatory framework... **Content:** The Canadian Securities Administrators (CSA) recently published final amendments that substantially harmonize the regulatory framework for syndicated mortgages in Canada. These final amendments will: - remove the prospectus and registration exemptions that currently apply to syndicated mortgages in certain jurisdictions to substantially harmonize the regulatory framework for distributions of syndicated mortgages in Canada, - enhance investor disclosure through revisions to the offering memorandum prospectus exemption for offerings of syndicated mortgages under that exemption, and - exclude syndicated mortgages from the private issuer exemption, ensuring they are offered under an exemption more appropriate for this type of security. executed by those banks that do not currently report any transactions to IIROC. The amendments will come into force on March 21, 2021. In parallel with the publication of the final amendments, certain jurisdictions are publishing material regarding local exemptions for qualified syndicated mortgages and for syndicated mortgages distributed to permitted clients or institutional investors. These [are available for download](https://www.osc.gov.on.ca/documents/en/Securities-Category4/csa_20200806_45-106_prospectus-exemptions.pdf#page=33) from the websites of these jurisdictions. 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. **Categories:** News & Updates --- ### [The CSA grant relief to Wealthsimple Digital Assets Inc. to operate a Crypto Asset Platform](https://baxsecuritieslaw.com/the-csa-grant-relief-to-wealthsimple-digital-assets-inc-to-operate-a-crypto-asset-platform/) **Published:** August 18, 2020 **Author:** Barbara Hendrickson **Excerpt:** On August 7, 2020 the Canadian Securities Administrators (CSA) granted relief to Wealthsimple Digital Assets Inc. (Wealthsimple) from certain registrant obligations, prospectus requirement and trade reporting requirements and suitability requirements to allow Wealthsimple to distribute Crypto Contracts Rights (as defined below) and operate a platform... **Content:** On August 7, 2020 the Canadian Securities Administrators (CSA) granted relief to Wealthsimple Digital Assets Inc. (Wealthsimple) from certain registrant obligations, prospectus requirement and trade reporting requirements and suitability requirements to allow Wealthsimple to distribute Crypto Contracts Rights (as defined below) and operate a platform that facilitates the buying, selling and holding of crypto assets subject to certain conditions, including investment limits, account appropriateness and reporting requirements. The relief is time limited to allow Wealthsimple to operate in a test environment and will expire upon the earlier of twenty four (24) months or the date the filer transitions the platform to its IIROC affiliate. CSA Staff Notice 21-327 Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets (CSA SN 21-327), securities and/or derivatives legislation may apply to platforms that facilitate the buying and selling of crypto assets, including crypto assets that are commodities, because the user’s contractual right to the crypto asset may itself constitute a security and/or a derivative (Crypto Rights Contract). To foster innovation and respond to novel circumstances, the CSA has considered an interim, time limited registration framework that would allow crypto asset platforms to operate within a regulated environment, with regulatory requirements tailored to the crypto asset platform’s operations. The overall goal of the regulatory framework is to ensure there is a balance between the need to be flexible and facilitate innovation in the Canadian capital markets, while upholding the regulatory mandate of promoting investor protection and fair and efficient capital markets. The Wealthsimple platform permits clients resident in Canada to enter into Crypto Rights Contracts to purchase, hold and sell Bitcoin and Ether (together, the Crypto Assets) through the Wealthsimple. Wealthsimple wishes to ultimately carry on this activity through its affiliated entity, which is registered as an investment dealer and a member of the Investment Industry Regulatory Organization of Canada (IIROC). While the Wealthsimple is engaged in discussions with IIROC on a regulatory approach for its affiliated entity to carry on this activity, the order allows Wealthsimple to commence operations and conduct beta testing. The order can be found at: [https://www.osc.gov.on.ca/documents/en/ord\_20200807\_wealthsimple-digital-assets.pdf](https://www.osc.gov.on.ca/documents/en/ord_20200807_wealthsimple-digital-assets.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario introduces interim registration and prospectus exemptions to facilitate start-up securities crowdfunding](https://baxsecuritieslaw.com/ontario-introduces-interim-registration-and-prospectus-exemptions-to-facilitate-start-up-securities-crowdfunding/) **Published:** August 18, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) announced on July 30, 2020 that in light of COVID-19 and the challenges it presents to small businesses seeking to raise capital, the Ontario Securities Commission (OSC) made an interim local order that adopts the start-up crowdfunding regime currently in... **Content:** The Canadian Securities Administrators (CSA) announced on July 30, 2020 that in light of COVID-19 and the challenges it presents to small businesses seeking to raise capital, the Ontario Securities Commission (OSC) made an interim local order that adopts the start-up crowdfunding regime currently in place in certain other Canadian jurisdictions (the Interim Order). Ontario Instrument 45–506 Start-Up Crowdfunding Registration and Prospectus Exemptions (Interim Class Order) which takes effect on July 30, 2020, provides registration and prospectus exemptions for start-up crowdfunding that are substantially similar to the local exemptions in British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, New Brunswick and Nova Scotia. On February 27, 2020, the CSA published for comment National Instrument 45-110 *Start-Up Crowdfunding Registration and Prospectus Exemptions* (the Proposed National Instrument), which will replace and harmonize the local start-up crowdfunding exemptions in British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia (as well as those in Ontario adopted through the Interim Order). The comment period on the Proposed National Instrument ended on July 13, 2020. The Interim Order remains in effect until the Proposed National Instrument is adopted or until 18 months from the effective date of the order. Other jurisdictions will make corresponding updates to their local guidance documents to include Ontario. The order can be found at: [Interim Order](https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20200730_45-506_start-up-crowdfunding-registration-prospectus-exemptions.htm). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law’s Barbara Hendrickson Quoted in the CBA National Magazine on the Ontario Capital Markets Modernization Taskforce](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-quoted-in-the-cba-national-magazine-on-the-ontario-capital-markets-modernization-taskforce/) **Published:** August 18, 2020 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson, of BAX Securities Law, was prominently quoted in a recent article in the Canadian Bar Association National Magazine. The article, “Going it Alone” by staff writer Doug Beazley, discusses the recent consultation report of the Ontario Capital Markets Modernization Taskforce published in July... **Content:** Barbara Hendrickson, of BAX Securities Law, was prominently quoted in a recent article in the Canadian Bar Association National Magazine. The article, “Going it Alone” by staff writer Doug Beazley, discusses the recent consultation report of the Ontario Capital Markets Modernization Taskforce published in July 2020 which sets out a series of reforms including in the area of reducing legislative and regulatory burden; encouraging competition between market participants and helping business grow and attracting investments. Barbara Hendrickson, while commending the proposed reform efforts set out in the report, believes that the reforms should be harmonized across Canada and developed in the context of a national securities regulator, the Cooperative Capital Markets Regulatory System (“CCMR”). Barbara Hendrickson raises the issue of coordination with the CCMR and the of timing of the initiative in Ontario. Along with B.C., Saskatchewan, New Brunswick, Nova Scotia, Prince Edward Island and Yukon, Ontario is a partner in the Cooperative Capital Markets Regulatory System, an effort to streamline capital markets regulation nationwide. According to Ms. Hendrickson many of the recommendations in the task force’s report only really make sense if they’re implemented nationally, — and introducing them regionally would “create even more fragmentation in our Canadian markets.” Barbara also commented on the need for harmonization in the area of prospectus exemptions in the context of private placements: “Currently, even though we have made great strides through the Canadian Securities Administrators process to streamline securities regulation across Canada, we still have different regimes in effect in different provinces — for example, in the crowdfunding and offering memorandum prospectus exemptions for private placements. A go-it-alone approach by Ontario would result in even more fragmented rules.” The complete article can be found: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Notice of General Order – Ontario Instrument 45-505 Relief in respect of the Distribution of Securities through a Funding Portal Operated by Silver Maple Ventures Inc.](https://baxsecuritieslaw.com/notice-of-general-order-ontario-instrument-45-505-relief-in-respect-of-the-distribution-of-securities-through-a-funding-portal-operated-by-silver-maple-ventures-inc/) **Published:** August 18, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) recently published Ontario Instrument 45-505 Relief in respect of the Distribution of Securities through a Funding Portal Operated by Silver Maple Ventures Inc. The OSC is providing issuers with relief from the requirement to file a prospectus in respect of... **Content:** The Ontario Securities Commission (OSC) recently published Ontario Instrument 45-505 Relief in respect of the Distribution of Securities through a Funding Portal Operated by Silver Maple Ventures Inc. The OSC is providing issuers with relief from the requirement to file a prospectus in respect of crowdfunding distributions of securities through a funding portal operated by Silver Maple Ventures Inc. The order provides that issuers in Ontario are exempt from the requirement to file a prospectus in respect of a crowdfunding distribution of securities facilitated through the funding portal known as “FrontFundr,” which is operated by the Filer, an exempt market dealer in Ontario, provided that certain conditions are satisfied, including that: 1. The distribution is of the issuer’s eligible securities; 2. The issuer is not a reporting issuer or an investment fund; 3. The issuer prepares an offering document that is made available to purchasers on the FrontFundr website; 4. The aggregate amount raised by the issuer in the crowdfunding distribution does not exceed $250,000 and the issuer completes no more than two distributions in a calendar year; and 5. Each purchaser invests no more than $1,500 (or no more than $5,000 if the purchaser has obtained positive suitability advice from a registered dealer). The order is intended to facilitate access to new sources of capital for those start-ups and small and medium sized enterprises that seek to conduct crowdfunding distributions of securities through the FrontFundr portal, without compromising investor protection. According ot the OSC his is particularly relevant in the current COVID-19 business environment, when it may be especially challenging for these categories of businesses to access capital. The order substantially mirrors prospectus exemptions provided to non-reporting issuers by certain other Canadian jurisdictions, including British Columbia, which adopted registration and prospectus exemptions by means of blanket orders intended to facilitate capital-raising through securities crowdfunding. The order can be found at: [https://www.osc.gov.on.ca/en/SecuritiesLaw\_rule\_20200528\_45-505\_general-order-silver-maple-ventures.htm](https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20200528_45-505_general-order-silver-maple-ventures.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 4031 -4606. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson to serve on OBA Council for 2020-2021 term](https://baxsecuritieslaw.com/barbara-hendrickson-to-serve-on-oba-council-for-2020-2021-term/) **Published:** August 25, 2020 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law is pleased to announce that Barbara Hendrickson has been appointed to serve on the Ontario Bar Association’s Council for the 2020-2021 year. The role of Council is to communicate with their constituents and share information about the OBA’s activities and initiatives. Throughout their... **Content:** BAX Securities Law is pleased to announce that Barbara Hendrickson has been appointed to serve on the Ontario Bar Association’s Council for the 2020-2021 year. The role of Council is to communicate with their constituents and share information about the OBA’s activities and initiatives. Throughout their term, Council members act as ambassadors and liaisons for the OBA within their region, identify issues and opportunities and provide advice to the Board on how to address them. This is Barbara’s fourth stint as Council Member having previously held that position as an elected member as well as in her capacity of President of the Association of Law Officers of the Crown and Women’s Law Association of Ontario. 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. **Categories:** News & Updates --- ### [CSA Notice of Amendments to National Instrument 51-102 Continuous Disclosure Obligations and Changes to Certain Policies Related to the Business Acquisition Report Requirements](https://baxsecuritieslaw.com/csa-notice-of-amendments-to-national-instrument-51-102-continuous-disclosure-obligations-and-changes-to-certain-policies-related-to-the-business-acquisition-report-requirements/) **Published:** August 25, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) on August 20, 2020 announced amendments and changes to National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102) (Amendments). The Amendments which are expect to be effective on November 18, 2020 are being made to the business acquisition report requirements. A... **Content:** The Canadian Securities Administrators (CSA) on August 20, 2020 announced amendments and changes to National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102) (Amendments). The Amendments which are expect to be effective on November 18, 2020 are being made to the business acquisition report requirements. A reporting issuer that is not an investment fund is required to file a business acquisition report (BAR) after completing a significant acquisition. The BAR requirements were introduced in 2004 to provide investors with relatively timely access to historical financial information on a significant acquisition. They also require a reporting issuer that is not a venture issuer to include pro forma financial statements in a BAR. Part 8 of NI 51-102 sets out three significance tests: the asset test, the investment test and the profit or loss test. An acquisition of a business or related businesses is a significant acquisition that requires the filing of a BAR under Part 8 of NI 51-102 for a reporting issuer that is not a venture issuer, if the result from any one of the three significance tests exceeds 20%; and for a venture issuer, if the result of either the asset test or investment test exceeds 100%. The Amendments alter the determination of significance for reporting issuers that are not venture issuers such that an acquisition of a business or related businesses is a significant acquisition only if at least two of the existing significance tests are triggered (the Two-Trigger Test); and increase the threshold of the significance tests for reporting issuers that are not venture issuers from 20% to 30%. The Amendments are available at: [https://www.osc.gov.on.ca/documents/en/Securities-Category5/ni\_20200820\_51-102\_business-acquisition-report-requirements.pdf](https://www.osc.gov.on.ca/documents/en/Securities-Category5/ni_20200820_51-102_business-acquisition-report-requirements.pdf) 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. **Categories:** News & Updates --- ### [CSA Notice of Amendments to NI 45-106, NI 31- 103, 45-106CP and 31-103CP relating to Syndicated Mortgages](https://baxsecuritieslaw.com/csa-notice-of-amendments-to-ni-45-106-ni-31-103-45-106cp-and-31-103cp-relating-to-syndicated-mortgages/) **Published:** September 2, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) recently published that an email was sent to stakeholders who the OSC identified as likely being impacted by the transfer of regulatory oversight of certain syndicated mortgage investment (SMI) activity to the OSC. The OSC posted the e-mail that was... **Content:** The Ontario Securities Commission (OSC) recently published that an email was sent to stakeholders who the OSC identified as likely being impacted by the transfer of regulatory oversight of certain syndicated mortgage investment (SMI) activity to the OSC. The OSC posted the e-mail that was sent to certain stakeholders regarding the transfer and the registration process for firms and individuals affected. If you will be impacted by the transfer of regulatory oversight, the OSC has asked that you provide answers to the questions from the e-blast below to the OSC at your earliest convenience. If you are not impacted then there is no need to provide responses. The OSC encourages all firms and individuals to review the information below to see if they may be impacted and contact the registration email address below with any further questions. The following is email that the OSC sent to affected stakeholders by the new SMI rules: **EMAIL FROM THE OSC TO STAKEHOLDERS** *“We are contacting you about changes to the regulation of syndicated mortgage investment (**SMI**) activity, as we understand that your firm may be engaged in SMI activity. We hope that our outreach will provide information to your firm to assist it in evaluating the securities regulatory options relating to its SMI activity after March 1, 2021.* *Amendments *On August 6, 2020, the Ontario Securities Commission (**OSC**) published proposed amendments to Ontario securities legislation, and the Canadian Securities Administrators (**CSA**) published final amendments (the **Amendments**), that would, among other things, subject SMI trading activity in Ontario to the registration requirements under Ontario securities legislation as of March 1, 2021 (**registrable activity**). Under the OSC’s proposed amendments, the following SMI activity would continue to be subject to oversight from the Financial Services Regulatory Authority of Ontario (**FSRA**):* - *transactions in mortgages, other than syndicated mortgages, with any purchaser;* - *transactions in “*[*qualified syndicated mortgages*](https://www.osc.gov.on.ca/documents/en/Securities-Category4/csa_20200806_45-106_prospectus-exemptions.pdf#page=38)*,” which is defined in the Amendments;* - *transactions in any type of syndicated mortgages where the purchaser is a “*[*permitted client*](https://www.osc.gov.on.ca/documents/en/Securities-Category4/csa_20200806_45-106_prospectus-exemptions.pdf#page=34)*”.* *Further information about the Amendments can be found at the following link:* [*https://www.osc.gov.on.ca/documents/en/Securities-Category4/csa\_20200806\_45-106\_prospectus-exemptions.pdf*](https://www.osc.gov.on.ca/documents/en/Securities-Category4/csa_20200806_45-106_prospectus-exemptions.pdf)*. If you have specific questions regarding the Amendments, please contact Adam Braun, Legal Counsel in the OSC’s Compliance and Registrant Regulation Branch at* [*abraun@osc.gov.on.ca*](mailto:abraun@osc.gov.on.ca)*.* *OSC Registration *Firms (and their individuals) that engage in SMI registrable activity in Ontario on or after March 1, 2021, will need to:* - *be registered as dealers in Ontario, or* - *rely on an exemption from registration in Ontario as a dealer.* *Please ensure you discuss the potential impact of the Amendments on your firm with your advisors, including legal counsel, as soon as possible.* *We note that, should registration be required, the OSC’s service standard for routine firm registration applications is 90 working days from the date of a complete application. Novel, complex or incomplete applications, or applications where fitness for registration requires additional analysis, typically take longer to process. In light of the expected volume of new registration applications resulting from the Amendments, **we strongly encourage firms that will require registration with the OSC by March 1, 2021, to apply for registration as soon as possible**.* *For more information about:* - *the OSC registration process generally, see* [*https://www.osc.gov.on.ca/en/Dealers\_getting-registered\_index.htm*](https://www.osc.gov.on.ca/en/Dealers_getting-registered_index.htm)*;* - *the OSC process for initial and firm applications, see* [*https://www.osc.gov.on.ca/en/Dealers\_applying\_index.htm*](https://www.osc.gov.on.ca/en/Dealers_applying_index.htm)*; and* - *completing and filing your initial firm application form with the OSC, see* [*https://www.osc.gov.on.ca/documents/en/Dealers/form-registration-guide.pdf*](https://www.osc.gov.on.ca/documents/en/Dealers/form-registration-guide.pdf)*.* *We will also be providing more information about these registration requirements in the future, which could include e-mails, notices or information sessions. We encourage you to subscribe for e-mails and notifications from the OSC CRR Branch, at* [*https://www.osc.gov.on.ca/en/subscribe.htm#roc*](https://www.osc.gov.on.ca/en/subscribe.htm#roc)*.* *Questions *In order for us to assist your firm with any OSC registration-related questions it may have and, if applicable, facilitate its registration with us, please respond to this email with answers to the following questions:* 1. *Do you expect to engage in SMI trading activity on or after March 1, 2021?* 2. *If the answer to #1 is yes, do you expect to:* 1. *apply for registration with the OSC (or have an affiliate apply for registration) as a dealer with a view to being registered with the OSC by March 1, 2021, or* 1. *rely on an exemption from registration with the OSC.* *Your responses to these questions by August 20, 2020, would be greatly appreciated and will assist your firm should registration with the OSC be required.”* For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403.4606. 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. **Categories:** News & Updates --- ### [SEC Modernizes the Accredited Investor Definition](https://baxsecuritieslaw.com/sec-modernizes-the-accredited-investor-definition/) **Published:** September 3, 2020 **Author:** Barbara Hendrickson **Excerpt:** The U.S. Securities and Exchange Commission (SEC) announced on August 26, 2020 that it was adopting amendments to the “accredited investor” definition, one of the principal tests for determining who is eligible to participate in private capital markets. The amendments allow investors to qualify as... **Content:** The U.S. Securities and Exchange Commission (SEC) announced on August 26, 2020 that it was adopting amendments to the “accredited investor” definition, one of the principal tests for determining who is eligible to participate in private capital markets. The amendments allow investors to qualify as accredited investors based on defined measures of professional knowledge, experience or certifications in addition to the existing tests for income or net worth. The SEC adopted amendments to update and improve the definition of “accredited investor” in the SEC’s rules and the definition of “qualified institutional buyer” in Rule 144A under the Securities Act of 1933. The amendments add new categories of qualifying natural persons and entities and make certain other modifications to the existing definition. The amendments to the qualified institutional buyer definition similarly expand the list of eligible entities under that definition. The amendments revise Rule 501(a), Rule 215, and Rule 144A of the Securities Act. The amendments to the accredited investor definition in Rule 501(a): - add a new category to the definition that permits natural persons to qualify as accredited investors based on certain professional certifications, designations or credentials or other credentials issued by an accredited educational institution, which the Commission may designate from time to time by order. In conjunction with the adoption of the amendments, the Commission designated by order holders in good standing of the Series 7, Series 65, and Series 82 licenses as qualifying natural persons. This approach provides the Commission with flexibility to reevaluate or add certifications, designations, or credentials in the future. Members of the public may wish to propose for the Commission’s consideration additional certifications, designations or credentials that satisfy the attributes set out in the new rule; - include as accredited investors, with respect to investments in a private fund, natural persons who are “knowledgeable employees” of the fund; - clarify that limited liability companies with $5 million in assets may be accredited investors and add SEC- and state-registered investment advisers, exempt reporting advisers, and rural business investment companies (RBICs) to the list of entities that may qualify; - add a new category for any entity, including Indian tribes, governmental bodies, funds, and entities organized under the laws of foreign countries, that own “investments,” as defined in Rule 2a51-1(b) under the Investment Company Act, in excess of $5 million and that was not formed for the specific purpose of investing in the securities offered; - add “family offices” with at least $5 million in assets under management and their “family clients,” as each term is defined under the Investment Advisers Act; and - add the term “spousal equivalent” to the accredited investor definition, so that spousal equivalents may pool their finances for the purpose of qualifying as accredited investors. The amendment to Rule 215 replaces the existing definition with a cross reference to the definition in Rule 501(a). The amendments expand the definition of “qualified institutional buyer” in Rule 144A to include limited liability companies and rural business investment companies (RBICs) if they meet the $100 million in securities owned and invested threshold in the definition. The amendments also add to the list any institutional investors included in the accredited investor definition that are not otherwise enumerated in the definition of “qualified institutional buyer,” provided they satisfy the $100 million threshold. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Postpone Issuing Annual Report of Women on Boards and in Executive Positions](https://baxsecuritieslaw.com/canadian-securities-administrators-postpone-issuing-annual-report-of-women-on-boards-and-in-executive-positions/) **Published:** September 18, 2020 **Author:** Barbara Hendrickson **Excerpt:** The securities regulators of Alberta, Manitoba, New Brunswick, Nova Scotia, Ontario, Quebec, and Saskatchewan (the participating jurisdictions) have jointly announced they are postponing the publication CSA Multilateral Staff Notice 58-311 Report on Fifth Staff Review of Disclosure regarding Women on Boards and in Executive Officer... **Content:** The securities regulators of Alberta, Manitoba, New Brunswick, Nova Scotia, Ontario, Quebec, and Saskatchewan (the participating jurisdictions) have jointly announced they are postponing the publication *CSA Multilateral Staff Notice 58-311 Report on Fifth Staff Review of Disclosure regarding Women on Boards and in Executive Officer Positions* (The report). The data in the report is compiled from public documents filed on the System for Electronic Document Analysis and Retrieval (SEDAR) by non-venture issuers with year-ends between December 31 and March 31 that filed information circulars by July 31. This year, due to COVID-19, a number of issuers delayed their Annual General Meeting and did not file information circulars by July 31. This left the CSA with a sample size not comparable with that of prior years. The CSA expects to publish the report in early 2021. 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. **Categories:** News & Updates --- ### [CSA Notice of Amendments to NI 81-105 Prohibition of Mutual Fund Trailing Commissions Where No Suitability Determination Was Required](https://baxsecuritieslaw.com/csa-notice-of-amendments-to-ni-81-105-prohibition-of-mutual-fund-trailing-commissions-where-no-suitability-determination-was-required/) **Published:** September 18, 2020 **Author:** Barbara Hendrickson **Excerpt:** On September 17, 2020 the Canadian Securities Administrators (CSA) published a notice (Notice) that the CSA are adopting amendments (Amendments) to National Instrument 81-105 Mutual Fund Sales Practices (NI 81-105), changes to Companion Policy 81-105CP Mutual Fund Sales Practices (81-105CP) and related consequential amendments to... **Content:** On September 17, 2020 the Canadian Securities Administrators (CSA) published a notice (Notice) that the CSA are adopting amendments (Amendments) to National Instrument 81-105 Mutual Fund Sales Practices (NI 81-105), changes to Companion Policy 81-105CP Mutual Fund Sales Practices (81-105CP) and related consequential amendments to National Instrument 41-101 General Prospectus Requirements (NI 41-101) and National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101). The Amendments - prohibit the payment of trailing commissions by members of the organization of publicly-offered mutual funds (fund organizations) to participating dealers who were not required to make a suitability determination in connection with a client’s purchase and ongoing ownership of prospectus qualified mutual fund securities, and - prohibit the solicitation or acceptance of trailing commissions by participating dealers from fund organizations, in connection with securities of the mutual fund held in an account of a client of the participating dealer if the participating dealer was not required to make a suitability determination in respect of the client in connection with those securities. According to the Notice the Amendments will effectively prohibit the payment of mutual fund trailing commissions to dealers who are not subject to the obligation to make a suitability determination under section 13.3 of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations or under the corresponding rules and policies of the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA). Such dealers would include, among others, order-execution only dealers and dealers acting on behalf of a “permitted client” that has waived the suitability requirements. The Amendments to NI 81- 101 and NI 41-101, which provide certain exemptions from the delivery requirements for fund facts documents and ETF facts documents, respectively, for all switches from a trailing commission paying series or class of a mutual fund to a no trailing commission series or class of the same mutual fund, are expected to come into force on December 31, 2020, and the Amendments to NI 81-105 are expected to come into force on June 1, 2022. The Amendments are available [here.](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-8/81105-CSA-Notice-September-17-2020.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Staff Notice 81-333 Guidance on Effective Liquidity Risk Management for Investment Funds](https://baxsecuritieslaw.com/csa-staff-notice-81-333-guidance-on-effective-liquidity-risk-management-for-investment-funds/) **Published:** September 22, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) published on September 18, 2020 in a notice (Notice) guidance to help investment fund managers develop and maintain effective liquidity risk management frameworks for investment funds. The Notice states that liquidity risk is the risk that a fund is unable to... **Content:** The Canadian Securities Administrators (CSA) published on September 18, 2020 in a notice (Notice) guidance to help investment fund managers develop and maintain effective liquidity risk management frameworks for investment funds. The Notice states that liquidity risk is the risk that a fund is unable to satisfy redemption requests without having a material impact on the remaining securityholders. A fund must be able to sell the underlying portfolio assets within a reasonable amount of time, in an orderly manner to satisfy redemption requests. Liquidity risk can increase when the liquidity of portfolio assets held by an investment fund does not match the redemption terms and conditions offered to its investors. In recent years, the management of this potential liquidity mismatch has been a key focus for regulators internationally and the asset management sector. While the guidance is intended for investment funds that are subject to National Instrument 81-102 *Investment Funds*, many of the practices and examples outlined may be relevant to other investment funds. Under securities legislation, investment fund managers must establish and maintain an effective liquidity risk management framework and exercise due care, skill and diligence in managing the liquidity of their funds. The Notice is available [here.](https://www.bcsc.bc.ca/about/media-room/news-releases/2020/79-canadian-securities-regulators-publish-liquidity-risk-management-guidance-for-investment-fund-managers) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [45-106 - CSA Notice and Request for Comment: Proposed Amendments to NI 45-106 and 45-106CP Relating to the Offering Memorandum Prospectus Exemption](https://baxsecuritieslaw.com/45-106-csa-notice-and-request-for-comment-proposed-amendments-to-ni-45-106-and-45-106cp-relating-to-the-offering-memorandum-prospectus-exemption/) **Published:** September 22, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) published a notice on September 17, 2020 for comment proposed changes to the offering memorandum prospectus exemption. The changes are reflected in proposed amendments to National Instrument 45-106 Prospectus Exemptions (NI 45-106), as well as proposed changes to Companion Policy 45-106CP Prospectus Exemptions (proposed... **Content:** The Canadian Securities Administrators (CSA) published a notice on September 17, 2020 for comment proposed changes to the offering memorandum prospectus exemption. The changes are reflected in proposed amendments to National Instrument 45-106 *Prospectus Exemptions* (NI 45-106), as well as proposed changes to Companion Policy 45-106CP *Prospectus Exemptions* (proposed amendments). The proposed amendments set out new disclosure requirements for issuers that are engaged in “real estate activities” or issuers that are “collective investment vehicles”. These include a new requirement for issuers with real estate activities to provide an independent appraisal of the real property, if it discloses a value for the real property other than in its financial statements, will use a material amount of the proceeds to acquire an interest in real property, or acquire an interest in real property from a related party. It is proposed that issuers that are collective investment vehicles will need to provide better disclosure to investors about the issuer’s investment decision-making process and the composition and performance of the issuer’s portfolio. Many issuers using the offering memorandum prospectus exemption are issuers that would meet these proposed definitions, and some already provide disclosure that would meet the proposed requirements. The new requirements are intended to set out a clearer framework for these issuers, giving them greater certainty as to what they must disclose, while giving investors more complete and relevant information. In addition, the proposed amendments include a number of general amendments, which are meant to clarify or streamline parts of NI 45-106 or improve disclosure for investors. The CSA Notice and Request for Comment setting out the proposed amendments can be found on the websites of CSA members. Comments should be submitted in writing by December 16, 2020. The CSA, the council of securities regulators of Canada’s provinces and territories, coordinates and harmonizes regulation for the Canadian capital markets. **Categories:** News & Updates --- ### [TSX BULLETIN Re: Temporary Relief of $0.05 Minimum Pricing Requirement - Extension](https://baxsecuritieslaw.com/tsx-bulletin-re-temporary-relief-of-0-05-minimum-pricing-requirement-extension/) **Published:** September 24, 2020 **Author:** Barbara Hendrickson **Excerpt:** On September 16, 2020 the TSX Venture Exchange (the “Exchange”) issued a bulletin on minimum pricing requirements. The Exchange had previously issued a bulletin (the “April 8, 2020 Bulletin”) providing notice that in response to the COVID-19 pandemic, the Exchange would provide temporary relief (the... **Content:** On September 16, 2020 the TSX Venture Exchange (the “**Exchange**”) issued a bulletin on minimum pricing requirements. The Exchange had previously issued a bulletin (the “**April 8, 2020 Bulletin**”) providing notice that in response to the COVID-19 pandemic, the Exchange would provide temporary relief (the “**Temporary Relief**”) from certain requirements of the Exchange’s Corporate Finance Manual (the “**Manual**”). According to the bulletin, the purpose of the April 8, 2020 temporary relief was to revise the minimum price at which Listed Shares may be issued from $0.05 to $0.01 in certain circumstances. If the Market Price of an Issuer’s Listed Shares is not greater than $0.05, the minimum price at which that Issuer may issue its Listed Shares in particular circumstances is equal to that Market Price, subject to a minimum price of $0.01. If the Market Price of an Issuer’s Listed Shares is greater than $0.05, the minimum price at which that Issuer may issue its Listed Shares remains equal to the Market Price less the existing allowable maximum discounts based on closing price, subject to a minimum price of $0.05. In the case of any discrepancy, the details of the Temporary Relief set out in the April 8, 2020 Bulletin prevail. The April 8, 2020 Bulletin stipulates that such Temporary Relief applies to Listed Shares that are issued on or before September 30, 2020. The Exchange now wishes to provide notice that it is extending the Temporary Relief such that it will apply to Listed Shares that are issued on or before December 31, 2020. The Bulletin is available [here.](https://tsx.com/resource/en/2396) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [New Trends in OSC Enforcement](https://baxsecuritieslaw.com/new-trends-in-osc-enforcement/) **Published:** October 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** On October 8, 2020 Barbara Hendrickson gave a Zoom presentation to the Toronto Business Lawyers Association on recent enforcement initiatives by the Ontario Securities Commission against participants in the securities markets. The presentation discusses recent changes in securities laws and enforcement actions by the OSC... **Content:** On October 8, 2020 Barbara Hendrickson gave a Zoom presentation to the Toronto Business Lawyers Association on recent enforcement initiatives by the Ontario Securities Commission against participants in the securities markets. The presentation discusses recent changes in securities laws and enforcement actions by the OSC against promoters, officers and directors of private companies for personal misuse of corporate assets, failure to keep proper business books and records and failure to have appropriate corporate governance and procedures in place. Click to below image to download Presentation: [![](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2020/10/Thumbnail-1.png)](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2020/10/TBLA-October-7th-20-update-2.pptx)For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson on ReferToHer List](https://baxsecuritieslaw.com/barbara-hendrickson-on-refertoher-list/) **Published:** October 28, 2020 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson, the managing partner and founder of BAX Securities Law, has been placed on the ReferToHer list as an expert in the Securities & Capital Markets area. ReferToHer was launched in June 2019, as a directory of experienced women lawyers in Canada. (see: https://refertoher.com)... **Content:** Barbara Hendrickson, the managing partner and founder of BAX Securities Law, has been placed on the ReferToHer list as an expert in the Securities & Capital Markets area. ReferToHer was launched in June 2019, as a directory of experienced women lawyers in Canada. (see: ) ReferToList has a website which lists of experienced practitioners in different fields including Securities & Capital Markets. The ReferToHer list began with 177 names and has now expanded to more than 400 people. New candidates for the list must be partners, senior counsel or sole practitioners and must be nominated by someone already on the list. The list is intended to “level the playing field within the system that exists currently” and “to drive more business to experienced women in law.” ReferToHer was recently the subject of an article in the Report on Business in the Globe & Mail on October 15, 2020. See: Barbara Hendrickson is the founder and managing partner of BAX and a senior securities lawyer with more than 20 years of experience including with the Ontario Securities Commission, a leading Canadian national law firm, and one of the world’s largest international law firms. BAX Securities Law which Barbara founded in 2013 has received for the third time ranked (2019-2020) as one of the Top 10 Corporate Boutique law firms in Canada by Canadian Lawyer It also received this prestigious ranking for 2016-2017 and 2018-2019. See: For additional info please visit: lawfirmbarbara.wpengine.com or contact Barbara Hendrickson: E: [bhendrickson@baxsecuritieslaw.com]() P: 416.601.1004 M: 647.403.4606 **Categories:** News & Updates --- ### [OSC Publishes Charter for Innovation Office](https://baxsecuritieslaw.com/osc-publishes-charter-for-innovation-office/) **Published:** October 31, 2020 **Author:** Barbara Hendrickson **Excerpt:** On October 29, 2020, the Ontario Securities Commission (OSC) announced that it has created a new branch - the Office of Economic Growth & Innovation (Innovation Office), which is “focused on supporting economic growth and innovation in Ontario’s capital markets.” and a Charter “to build a... **Content:** On October 29, 2020, the Ontario Securities Commission (OSC) announced that it has created a new branch – the Office of Economic Growth & Innovation (Innovation Office), which is “focused on supporting economic growth and innovation in Ontario’s capital markets.” and a Charter “to build a stronger innovation ecosystem and fuel Ontario’s long-term economic growth.” The Innovation Office was launched earlier this year, and expects to be fully operational by March 2021. The Charter outlines several initiatives the Office including: - an experimental testing framework for novel ideas and start-ups that will include an Ontario sandbox, - introducing interactive ways to engage with stakeholders, - the publication of research and position papers on how to affect change and support innovative processes in capital markets, - testing and implementing methods to reduce regulatory barriers, - encouraging greater accessibility to data to assist businesses in providing new products and services, and - further consideration of how regulatory technology can benefit market participants and the OSC. The initial areas of focus outlined in the Charter will evolve through further research and stakeholder engagement. Anyone seeking to share feedback or ideas with the Office should contact . The press release and Charter can be found at: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Provide Guidance To Issuers On Reporting Impact Of COVID-19](https://baxsecuritieslaw.com/canadian-securities-regulators-provide-guidance-to-issuers-on-reporting-impact-of-covid-19/) **Published:** October 31, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) on October 29, 2020 published its biennial report on its continuous disclosure review program (Report). The CSA’s continuous disclosure review program assesses the compliance of issuers’ continuous disclosure documents with securities law and aims to help improve the completeness, quality... **Content:** The Canadian Securities Administrators (CSA) on October 29, 2020 published its biennial report on its continuous disclosure review program (Report). The CSA’s continuous disclosure review program assesses the compliance of issuers’ continuous disclosure documents with securities law and aims to help improve the completeness, quality and timeliness of continuous disclosure by reporting issuers. The Report outlines common deficiencies and provides examples of how to improve disclosure on select topics including: forward looking information; non-GAAP financial measures; overly promotional disclosure; insider reporting; and mineral project disclosure. The Report includes guidance for issuers on reporting the impact of COVID-19 to assist market participants to provide clear disclosure on how COVID-19 is impacting their business. According to the CSA, the Report will assist issuers when preparing their financial statements and MD&A, including information about operating performance, financial position, liquidity and future prospects. Please see: [CSA Multilateral Staff Notice 51-361 *Continuous Disclosure Review Program Activities for the fiscal years ended March 31, 2020 and March 31, 2019*](https://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20201029_51-361_continuous-disclosure-review.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [OSC, ASC and AMF invite businesses to participate in cross-border testing](https://baxsecuritieslaw.com/osc-asc-and-amf-invite-businesses-to-participate-in-cross-border-testing/) **Published:** October 31, 2020 **Author:** Barbara Hendrickson **Excerpt:** On October 29, 2020 the Ontario Securities Commission (OSC), Alberta Securities Commission (ASC) and Autorité des marchés financiers (AMF) announced that they are inviting businesses in their respective markets to apply to test innovative products, services and business models across international borders. The initiative allows eligible... **Content:** On October 29, 2020 the Ontario Securities Commission (OSC), Alberta Securities Commission (ASC) and Autorité des marchés financiers (AMF) announced that they are inviting businesses in their respective markets to apply to test innovative products, services and business models across international borders. The initiative allows eligible firms to simultaneously test and scale innovative products or services in multiple jurisdictions. The cross border initiative is led by the [Global Financial Innovation Network (GFIN)](https://www.thegfin.com/crossborder-testing), and is supported by 23 regulators across five continents. The GFIN has published a ‘Regulatory Compendium’ for businesses interested in participating in the initiative, which sets out the roles and responsibilities of the participating regulators and the innovation services available in those markets. Interested businesses are asked to fill out one application, through the single-entry portal, to test in multiple markets. Applications are due by December 31, 2020. Please see: https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20201029\_osc-asc-amf-invite-businesses-to-participate-in-cross-border-testing.htm For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson joins the British Columbia Securities Commission Fintech Advisory Forum](https://baxsecuritieslaw.com/barbara-hendrickson-joins-the-british-columbia-securities-commission-fintech-advisory-forum/) **Published:** November 17, 2020 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law is pleased to announce that Barbara Hendrickson has been appointed to BCSC Fintech Advisory Forum for a two year term. The Forum is made up of financial technology (fintech) industry professionals and experts. The Forum advises BCSC staff on fintech trends and... **Content:** BAX Securities Law is pleased to announce that Barbara Hendrickson has been appointed to BCSC Fintech Advisory Forum for a two year term. The Forum is made up of financial technology (fintech) industry professionals and experts. The Forum advises BCSC staff on fintech trends and developments, including opportunities and risks, and provide input on fintech issues in the securities industry and securities law issues affecting fintech. The Forum is chaired by the BCSC’s Fintech & Innovation Team (FIT), formerly known as the Tech Team. The Forum members will consider a number of issues facing the regulation of the Fintech industry including in the following areas: • distributed ledger technology (DLT)/blockchain (including crypto-assets and/or trading platforms); • artificial intelligence/machine learning (AI/ML); • investment services platforms (including crowdfunding platforms and online advisors); • data analytics and/or big data; • regulatory technology/supervisory technology; • systemic risk; • access to capital; • global fintech trends and developments; • innovator functions (such as incubators, research & development programs, labs/academics, and fintech industry groups); and • marketplaces/ exchanges developing blockchain clearing platforms and other large-scale fintech initiatives. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators provide guidance to issuers on reporting impact of COVID-19](https://baxsecuritieslaw.com/canadian-securities-regulators-provide-guidance-to-issuers-on-reporting-impact-of-covid-19-2/) **Published:** November 24, 2020 **Author:** Barbara Hendrickson **Excerpt:** On November 18, 2020 the Canadian Securities Administrators (CSA) published its biennial report (CSA Multilateral Staff Notice 51-361 Continuous Disclosure Review Program Activities for the fiscal years ended March 31, 2020 and March 31, 2019) on its continuous disclosure review program including guidance on reporting... **Content:** **On November 18, 2020** the Canadian Securities Administrators (CSA) published its biennial report (CSA Multilateral Staff Notice 51-361 Continuous Disclosure Review Program Activities for the fiscal years ended March 31, 2020 and March 31, 2019) on its continuous disclosure review program including guidance on reporting the impact of COVID-19. The report outlines common deficiencies and provides examples of how to improve disclosure on select topics including: forward looking information; non-GAAP financial measures; overly promotional disclosure; insider reporting; and mineral project disclosure. The CSA reported that in fiscal 2020, 55 per cent (2019 – 67 per cent) of review outcomes required issuers to take action to improve and/or amend their disclosure, with some issuers being referred to enforcement, cease-traded or placed on the default list. Relevant regulatory guidance can be accessed at the CSA COVID-19 Information Hub [here](https://www.securities-administrators.ca/aboutcsa.aspx?id=1885). The Hot Buttons and examples of deficient disclosure describe additional potential disclosure considerations in the context of the current environment; however, the observations below do not represent an exhaustive list. Issuers should consider their business and operations to provide clear and transparent disclosure of the impact of COVID-19 and [https://www.osc.gov.on.ca/en/SecuritiesLaw\_csa\_20201029\_51-361\_continuous-disclosure-review.htm](https://www.osc.gov.on.ca/en/SecuritiesLaw_csa_20201029_51-361_continuous-disclosure-review.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Alberta And Saskatchewan Securities Regulators Seek Comment On Proposed New Exemption Designed To Facilitate Access To Capital](https://baxsecuritieslaw.com/alberta-and-saskatchewan-securities-regulators-seek-comment-on-proposed-new-exemption-designed-to-facilitate-access-to-capital/) **Published:** November 24, 2020 **Author:** Barbara Hendrickson **Excerpt:** On November 20, 2020, of the Alberta Securities Commission (ASC) and the Financial and Consumer Affairs Authority of Saskatchewan (FCAA) announced a proposed new prospectus exemption designed to provide greater access to capital for Alberta and Saskatchewan businesses and broaden investment opportunities for Alberta and... **Content:** **On November 20, 2020,** of the Alberta Securities Commission (ASC) and the Financial and Consumer Affairs Authority of Saskatchewan (FCAA) announced a proposed new prospectus exemption designed to provide greater access to capital for Alberta and Saskatchewan businesses and broaden investment opportunities for Alberta and Saskatchewan investors. The proposed prospectus exemption would allow investment by investors who certify to having certain financial and investing experience and education, and acknowledge certain investment considerations and risks. To reduce the risks to investors, investments would be limited in a 12-month period to $10,000 in any one business and $30,000 across multiple businesses. Details of the proposal are set out in CSA Multilateral Notice 45-327 *Proposed Prospectus Exemption for Self-Certified Investors* available on the websites of the [ASC](https://www.albertasecurities.com/) and the [FCAA](https://fcaa.gov.sk.ca/). The comment period for the proposed new prospectus exemption is open until December 23, 2020. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [OSC awards over half a million to three whistleblowers](https://baxsecuritieslaw.com/osc-awards-over-half-a-million-to-three-whistleblowers/) **Published:** November 24, 2020 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) announced on November 17, 2020 that it has awarded a total of CAD $585,000 to three whistleblowers, each of whom provided timely, specific and credible information that helped advance enforcement action resulting in monetary payments to the OSC. According to... **Content:** The Ontario Securities Commission (OSC) announced on November 17, 2020 that it has awarded a total of CAD $585,000 to three whistleblowers, each of whom provided timely, specific and credible information that helped advance enforcement action resulting in monetary payments to the OSC. According to the press release, “The whistleblowers included company outsiders who provided Enforcement Staff with specialized technical analysis on a complex area of securities law that led to the opening of an investigation, and that broadened an existing investigation. The whistleblowers’ detailed information brought to light violations of Ontario securities law that would have otherwise been difficult to detect, and it allowed Staff to proceed more expeditiously. In addition, each whistleblower provided extensive and ongoing assistance to Staff, participating in multiple meetings and providing further evidence and contributions to advance investigations.” According to the press release, since its launch in July 2016, the OSC’s Whistleblower Program has awarded more than $8.6 million to whistleblowers. The Program accepts tips on possible violations of Ontario securities law, offers protections for individuals who come forward, as well as compensation of up to $5 million for tips that lead to enforcement action. For more on the OSC’s Whistleblower Program, see: [http://www.officeofthewhistleblower.ca](http://www.officeofthewhistleblower.ca/) and [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20201117\_osc-awards-over-half-a-million-to-three-whistleblowers.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20201117_osc-awards-over-half-a-million-to-three-whistleblowers.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators outline recent developments on interest rate benchmarks](https://baxsecuritieslaw.com/canadian-securities-regulators-outline-recent-developments-on-interest-rate-benchmarks/) **Published:** November 30, 2020 **Author:** Barbara Hendrickson **Excerpt:** On November 26, 2020, the Canadian Securities Administrators (CSA) published a staff notice on recent developments regarding interest rate benchmarks (Notice). According to the Notice, Refinitiv Benchmark Services (UK) Limited (RBSL), the administrator of Canadian Dollar Offered Rate (CDOR), announced on November 12, 2020 that... **Content:** **On November 26, 2020, the Canadian Securities Administrators (CSA)** published a staff notice on recent developments regarding interest rate benchmarks (Notice). According to the Notice, Refinitiv Benchmark Services (UK) Limited (RBSL), the administrator of Canadian Dollar Offered Rate (CDOR), announced on November 12, 2020 that the six-month and 12-month tenors of CDOR will cease to be published effective May 17, 2021 (the effective date). The one, two and three-month tenors of CDOR will continue to be published after the effective date. The staff notice also outlines international developments to replace key inter-bank offered rates (IBORs) with nearly risk-free reference rates (RFRs). In particular, the United Kingdom, the United States and other countries are currently working to replace the London inter-bank offered rate (LIBOR) with alternative RFRs before the end of 2021. See CSA Staff Notice 25-302 *Matters Relating to CDOR, LIBOR and Other Interest Rate Benchmarks* is available on CSA members’ websites: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Climate Change Legislation](https://baxsecuritieslaw.com/climate-change-legislation/) **Published:** November 30, 2020 **Author:** Barbara Hendrickson **Excerpt:** On 19 November 2020, the Minister of Environment and Climate Change (Minister) introduced Bill C-12 An Act respecting transparency and accountability in Canada's efforts to achieve net-zero greenhouse gas emissions by the year 2050 (Canadian Net-Zero Emissions Accountability Act), in the House of Commons and... **Content:** On 19 November 2020, the Minister of Environment and Climate Change (Minister) introduced Bill C-12 An Act respecting transparency and accountability in Canada’s efforts to achieve net-zero greenhouse gas emissions by the year 2050 (Canadian Net-Zero Emissions Accountability Act), in the House of Commons and it was given first reading. Bill C-12 requires that national targets for the reduction of greenhouse gas emissions in Canada be set, with the objective of attaining net-zero emissions by 2050. The targets are to be set by the Minister of the Environment for 2030, 2035, 2040 and 2045. Each yearly target will be based on the scientific information and target for the year to which the plan relates as well as a description of the key emissions-reduction measures the Government of Canada intends to take to achieve its greenhouse-gas-emissions target; a description of any relevant sectoral strategies; and a description of emissions-reduction strategies for federal government operations. In the event of a missed target, the Minister must table a report outlining the reasons why Canada failed to meet the target and describing the actions the Government will take or is taking to address the failure to achieve the target. Beyond tabling reports in Parliament, the Act calls on the Commissioner of the Environment and Sustainable Development to examine and report on the Government’s implementation of climate-change mitigation measures at least once every five years. The legislation also establishes an independent Net-Zero Advisory Body to provide the Government of Canada with expert advice to grow the economy and achieve net-zero emissions including on measures to catalyze long-term, low-carbon economic growth across the Canadian economy, as well as policy measures to incentivize economically and environmentally beneficial investments in step-change infrastructure and clean technology. The Advisory Body is required to consider a range of factors: - Economic costs and opportunities. For example, impacts on job creation and competitiveness, trade and export opportunities, regional economic impacts, opportunities for small and medium-sized enterprises, and domestic and international supply chain considerations. - Environmental benefits. For example, greenhouse-gas-reduction potential, improved resilience and adaptation to climate change, decreases to other pollutants, and nature conservation and other co-benefits. - Contributions to inclusivity and well-being. For example, opportunities to further reconciliation with Indigenous Peoples; analysis of the impacts on marginalized or vulnerable people; degree of public engagement, awareness, and support for the proposed actions; and improvements to Canada’s education and skills development agenda. - Technological readiness and requirements. For example, available and emerging clean technologies, role of net-negative technologies, and technology needs and investments required. Please see: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson Joins the Women’s Law Association of Ontario’s Advisory Council](https://baxsecuritieslaw.com/barbara-hendrickson-joins-the-womens-law-association-of-ontarios-advisory-council/) **Published:** November 30, 2020 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law is pleased to announce that Barbara Hendrickson, its founder and managing partner has been invited to join to the Women’s Law Association of Ontario’s Advisory Council. The Council is made up to past presidents, past board members and long serving members. The Women’s... **Content:** BAX Securities Law is pleased to announce that Barbara Hendrickson, its founder and managing partner has been invited to join to the Women’s Law Association of Ontario’s Advisory Council. The Council is made up to past presidents, past board members and long serving members. The Women’s Law Association of Ontario (WLAO) has been providing leadership and support to advance the status of women in the legal profession in Ontario since 1919 and is the oldest legal association in Canada. The WLAO Advisory Council was created to guide and assist the WLAO Board to meet its stated mission of empowering women in the legal profession by providing a collective voice and advocating for equality, diversity and change. The WLAO Advisory Council serves to make recommendations and/or provide key information and materials to the Board of Directors. Barbara has a long history with the WLAO having served on the Board Executive from (1994-2002) and President (1998 -2001). Barbara was awarded the WLAO President’s award in 2009 which recognizes lawyers who have made a substantial contribution to the legal community and who demonstrate a commitment to the promotion of women in the law. For additional info please visit: www.lawfirmbarbara.wpengine.com or contact Barbara Hendrickson: E: [bhendrickson@baxsecuritieslaw.com](https://lawfirmbarbara.wpengine.com/bax-securities-law-voted-a-top-10-canadian-corporate-boutique-law-firm-for-2018-2019/bhendrickson@baxsecuritieslaw.com) P: 416.601.1004 M: 647.403.4606 **Categories:** News & Updates --- ### [CSA Consultation Paper 25-403: Activist Short Selling](https://baxsecuritieslaw.com/csa-consultation-paper-25-403-activist-short-selling/) **Published:** December 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** On December 3, 2020 the Canadian Securities Administrators (CSA) published a consultation paper ( Consultation Paper) is to facilitate discussion of concerns relating to activist short selling and its potential impact on Canadian capital markets. The Consultation Paper summarizes stakeholder concerns about activist short selling,... **Content:** On December 3, 2020 the Canadian Securities Administrators (CSA) published a consultation paper ( Consultation Paper) is to facilitate discussion of concerns relating to activist short selling and its potential impact on Canadian capital markets. The Consultation Paper summarizes stakeholder concerns about activist short selling, outlines the Canadian and international regulatory frameworks for this activity and sets out CSA Staff’s findings regarding the nature and extent of activist short selling in Canada. According to press release accompanying the Consultation Paper, activist short selling involves an individual or entity that takes a short position in a security and then publicly shares information that is expected to negatively impact a company’s stock price. If the value of the security declines, the short seller realizes a profit. The CSA’s research and analysis on short selling began in 2019 and the key findings of that review as set out in the Consultation Paper have been: - Activist short sellers tend to gravitate towards the securities of issuers and sectors where there is perceived overvaluation. - U.S. issuers are more frequently targeted by activist short sellers than Canadian issuers. - Canadian short selling campaigns tended to focus on larger issuers. - The majority (75%) of Canadian campaigns analyzed experienced a negative price impact on their price in the short-term and also over time. - Approximately 40 per cent involved allegations of some type of fraud at the issuer, the most common being a stock promotion scheme. The CSA is requesting feedback on the Consultation Paper by March 3, 2021. For more information please see: CSA Consultation Paper 25-403 *Activist Short Selling* can be found on [CSA members’ websites](https://www.securities-administrators.ca/industry_resources.aspx?id=47). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Bank of Canada and OSFI announce Climate Change Risk Scenarios Pilot Project](https://baxsecuritieslaw.com/bank-of-canada-and-osfi-announce-climate-change-risk-scenarios-pilot-project/) **Published:** December 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** On November 16, 2020 the Bank of Canada (Bank) and the Office of the Superintendent of Financial Institutions (OSFI) today announced plans for a pilot project to use climate-change scenarios to better understand the risks to the financial system related to a transition to a... **Content:** On November 16, 2020 the Bank of Canada (Bank) and the Office of the Superintendent of Financial Institutions (OSFI) today announced plans for a pilot project to use climate-change scenarios to better understand the risks to the financial system related to a transition to a low-carbon economy (project). A small group of institutions from the banking and insurance sectors will participate voluntarily in the project. According to the announcement, scenario analysis is a useful tool for identifying potential risks in an environment of considerable uncertainty. Climate-change scenarios related to a transition to a low-carbon economy explore different pathways for emissions reductions – driven by changes in policy, technology, and consumer and investor preferences – and their implications for the economy and financial system. The project aims to: - build the climate scenario analysis capability of authorities and financial institutions, and support the Canadian financial sector in enhancing the disclosure of climate-related risks - increase authorities’ and financial institutions’ understanding of the financial sector’s potential exposure to risks associated with a transition to a low-carbon economy - improve authorities’ understanding of financial institutions’ governance and risk-management practices around climate-related risks and opportunities Building on climate-change scenarios developed for the global economy, the Bank and OSFI will first develop a set of climate-change scenarios that are relevant for Canada. Using these scenarios, participants will explore the potential risk exposures of their balance sheets. The Bank and OSFI will publish a report, planned for the end of 2021, sharing details on the specific scenarios, methodology, assumptions and key sensitivities. This project is not intended to serve as an assessment of individual financial institutions’ exposure to climate-related risks or the broader financial sector’s resilience to transition risks. Further, the selection of project participants is not an endorsement of their current approaches to the management or disclosure of climate risks. The announcement also highlighted the following activities of the Bank of Canada and OSFI in the climate change area: - The Bank’s work on climate-related risks stems from its broader role in assessing risks to the stability of the Canadian [finan](https://www.bankofcanada.ca/core-functions/financial-system/)[c](https://www.bankofcanada.ca/core-functions/financial-system/)[ial system](https://www.bankofcanada.ca/core-functions/financial-system/). - The climate-change scenarios to be developed for the project will build on [work conducted by researchers at the Bank of Canada](https://www.bankofcanada.ca/2020/05/staff-discussion-paper-2020-3/). - In 2019, the Bank joined the [*Network of Central Banks and Supervisors for Greening the Financial System*](https://www.ngfs.net/en) and began building climate-related risks into its [*Financial System Review*](https://www.bankofcanada.ca/2019/05/fsr-summary-2019/). - Research and analysis that stem from the Bank’s [multi-year climate research plan](https://www.bankofcanada.ca/2019/11/researching-economic-impacts-climate-change/) are published on the [*Financial System Hub*](https://www.bankofcanada.ca/core-functions/financial-system/financial-system-hub/). - OSFI’s work on climate-related risks focuses on potential impacts on the financial soundness of individual banks, insurers and private pension plans and on the stability of the financial system as a whole. - OSFI is working with international counterparts as an active participant in the [*Sustainable Insurance Forum*](https://www.sustainableinsuranceforum.org/), a UN-sponsored grouping of financial regulators. - Early in 2021, OSFI will launch a discussion paper on preparing for and building financial resilience to climate-related risks. Please see: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [The TSXV announces Changes to Re: Policy 2.4 - Capital Pool Companies](https://baxsecuritieslaw.com/the-tsxv-announces-changes-to-re-policy-2-4-capital-pool-companies/) **Published:** December 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** On December 1, 2020, the TSX Venture Exchange (the “TSXV”) announced changes to its Capital Pool Company (“CPC”) program found in Policy 2.4 Capital Pool Companies which according to the press release accounted for almost 50% of new TSXV listings over the past 10 years.... **Content:** On December 1, 2020, the TSX Venture Exchange (the “**TSXV**”) announced changes to its Capital Pool Company (“**CPC**”) program found in Policy 2.4 Capital Pool Companies which according to the press release accounted for almost 50% of new TSXV listings over the past 10 years. The CPC program provides entrepreneurs, whose growth and development-stage companies require capital and public company management expertise, with access to investors with financial market experience. The following components of the TSXV’s Corporate Finance Manual are being amended: - Policy 2.4 – *Capital Pool Companies* - Form 3A – *Information Required in a CPC Prospectus* - Form 2F – *CPC Escrow Agreement* - Form 3B1 – *Information Required in an Information Circular for a Qualifying Transaction / Form 3B2 –* *Information Required in a Filing Statement for a Qualifying* According to the press release the new changes will take effect on January 1, 2021 and will provide: - Increased flexibility – new jurisdictions added, residency restrictions eased, spending restrictions simplified - Reduced regulatory burden – relaxed requirements on shareholder distribution and shareholder approval, fewer restrictions on PRO subscriptions - Improved economics – increased seed investment, finders fees, shorter escrow The amendments are expected to become effective on January 1, 2021. For more information please see: [https://www.tsx.com/news?id=798&year=2020](https://www.tsx.com/news?id=798&year=2020) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators publish guidance on automatic securities disposition plans](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-guidance-on-automatic-securities-disposition-plans/) **Published:** December 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** On December 10, 2020, the Canadian Securities Administrators (CSA) and the Ontario Securities Commission (OSC) announced that it was publishing guidance for issuers and insiders on the establishment, use and disclosure of automatic securities disposition plans (ASDPs). ASDPs enable insiders to make preplanned sales of... **Content:** On December 10, 2020, the Canadian Securities Administrators (CSA) and the Ontario Securities Commission (OSC) announced that it was publishing guidance for issuers and insiders on the establishment, use and disclosure of automatic securities disposition plans (ASDPs). ASDPs enable insiders to make preplanned sales of securities of an issuer through a dealer or an arms-length administrator, according to a predetermined schedule and set of instructions. This guidance follows the CSA’s previous guidance on ASDPs announced on October 24, 2019. Recommended best practices set out in the guidance include oversight by the issuer, a waiting period prior to the first transaction made under the plan, and meaningful restrictions for amendments, suspension and termination of an ASDP. According to the announcement and as announced on October 24, 2019, staff of the CSA remain unlikely to recommend insider reporting relief for trades under ASDPs. Please see: [https://www.osc.gov.on.ca/documents/en/Securities-Category5/csa\_20201210\_55-317\_automatic-securities-disposition-plans.pdf](https://www.osc.gov.on.ca/documents/en/Securities-Category5/csa_20201210_55-317_automatic-securities-disposition-plans.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [OSC, ASC, AMF and BCSC invite businesses to participate in cross-border testing of innovative products](https://baxsecuritieslaw.com/osc-asc-amf-and-bcsc-invite-businesses-to-participate-in-cross-border-testing-of-innovative-products/) **Published:** December 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** On December 9, 2020, and British Columbia Securities Commission (BCSC) joined the Ontario Securities Commission (OSC), Alberta Securities Commission (ASC), and the Autorité des marchés financiers (AMF) inviting businesses to apply to test innovative products, services and business models across international borders. According to the release,... **Content:** On December 9, 2020, and British Columbia Securities Commission (BCSC) joined the Ontario Securities Commission (OSC), Alberta Securities Commission (ASC), and the Autorité des marchés financiers (AMF) inviting businesses to apply to test innovative products, services and business models across international borders. According to the release, eligible firms will be able to simultaneously test and scale innovative products or services include fintech products in multiple jurisdictions, while also gaining insights into how their business might operate in these markets. Led by the Global Financial Innovation Network (GFIN), this cross-border initiative is currently chaired by the Financial Conduct Authority (FCA) in the United Kingdom The GFIN consists of 60 international organizations, committed to supporting financial innovation in the interests of consumers, including 23 organizations committed to cross-border-testing. Please see: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [OSC proposes elimination of routine exemptive relief applications for international firms](https://baxsecuritieslaw.com/osc-proposes-elimination-of-routine-exemptive-relief-applications-for-international-firms/) **Published:** December 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** On December 1, 2020 the Ontario Securities Commission (OSC) announced a proposal that would reduce the regulatory burden for international dealers and advisers that provide trading or advisory services to institutional investors in Ontario. The proposal would eliminate the need for these firms to file routine... **Content:** On December 1, 2020 the Ontario Securities Commission (OSC) announced a proposal that would reduce the regulatory burden for international dealers and advisers that provide trading or advisory services to institutional investors in Ontario. The proposal would eliminate the need for these firms to file routine applications for exemptive relief and would enhance institutional investor access to international options and futures markets, thereby reducing regulatory costs for such institutional investors. Currently, international firms must apply for certain exemptions from registration requirements in the [*Commodity Futures Act*](https://www.ontario.ca/laws/statute/90c20) (Ontario). These applications may also include a request to be exempt from certain options proficiency requirements in [OSC Rule 91-502 *Trades in Recognized* *Options*](https://www.osc.gov.on.ca/en/13018.htm). The OSC is proposing to codify a standardized set of exemptions, which are subject to standard terms and conditions, from registration and proficiency requirements for international firms that provide trading or advisory services to institutional investors in Ontario. Under the proposal, applications would continue to be considered on a case-by-case basis only if they raise novel issues, or if applicants indicate that standard terms and conditions are not appropriate for their business model or client base. Stakeholders are asked to submit comments on the proposal by March 1, 2021. Please see: [https://www.osc.gov.on.ca/en/NewsEvents\_nr\_20201201\_osc-proposes-elimination-routine-exemptive-relief-applications-international-firms.htm](https://www.osc.gov.on.ca/en/NewsEvents_nr_20201201_osc-proposes-elimination-routine-exemptive-relief-applications-international-firms.htm) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BCSC gaining greater insight on fintech through new stakeholder forum](https://baxsecuritieslaw.com/bcsc-gaining-greater-insight-on-fintech-through-new-stakeholder-forum/) **Published:** December 14, 2020 **Author:** Barbara Hendrickson **Excerpt:** The British Columbia Securities Commission (BCSC) announced that the first meeting of its Fintech Advisory Forum, was held on November 24, 2020. The Forum advises BCSC staff on trends and development in the fintech space, as well as the unique situations faced by innovative businesses in... **Content:** The British Columbia Securities Commission (BCSC) announced that the first meeting of its [Fintech Advisory Forum](https://www.bcsc.bc.ca/securities-law/law-and-policy/bc-notices/current/bcn-202007-december-10-2020), was held on November 24, 2020. The Forum advises BCSC staff on trends and development in the fintech space, as well as the unique situations faced by innovative businesses in the securities industry. Barbara Hendrickson of BAX Securities Law is one of the 17 volunteer members of the Forum which provides input to BCSC staff about the opportunities, risks and securities law issues facing the fintech industry. The Fintech Advisory Forum is being led by the BCSC’s [Fintech & Innovation Team (FIT)](https://www.bcsc.bc.ca/industry/financial-technology-innovation/fintech-consultation). Established in 2017, the FIT has responds to fintech-related inquiries and facilitates the authorization of innovative business models, including security token dealers, crypto investment funds and client onboarding processes that use artificial intelligence. The FIT also works with other regulators in Canada and globally to adapt securities regulations to business models based on new technology. Please see: & For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [You're Invited! - Selling Your Law Firm (February 11, 2021)](https://baxsecuritieslaw.com/youre-invited-selling-your-law-firm-february-11-2021/) **Published:** January 25, 2021 **Author:** Barbara Hendrickson **Excerpt:** Vitaly Timokhov of Tax Chambers and Barbara Hendrickson of BAX Securities Law will walk you through issues to be considered in selling your law firm from valuation to through negotiation of the sale including: Opportunities for small and mid-size law firmsValuation of the practiceDo you... **Content:** Vitaly Timokhov of Tax Chambers and Barbara Hendrickson of BAX Securities Law will walk you through issues to be considered in selling your law firm from valuation to through negotiation of the sale including: - Opportunities for small and mid-size law firms - Valuation of the practice - Do you need an expert evaluation - What are you selling: the business versus the practice - Tax implications of a same versus assets transaction - Best strategies for marketing your law firm - Vetting proposals / Offers - Tips on negotiating the sale of your practice Please join us on February 11, 2021 at 10:00 am to hear more about this important topic. Vitaly specializes in providing sophisticated tax advice. He practises exclusively in the area of Canadian federal income taxation and tax planning, with an emphasis on international and domestic reorganizations, mergers and acquisitions, and personal tax planning for Canadian and foreign-based corporations and individuals. **Location**: Zoom – **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommended Changes To The Definition Of Accredited Investor For Reporting Issuers](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommended-changes-to-the-definition-of-accredited-investor-for-reporting-issuers/) **Published:** February 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas: - improving regulatory structure to enhance governance - improving competitiveness through regulatory measures - ensuring a level playing field between large and small market players - improving the proxy system, corporate governance and the process of mergers and acquisitions - fostering innovation - modernizing enforcement and enhancing investor protection Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #12 Changes to the Definition of Accredited Investors for Reporting Issuers** Currently, securities issued by any issuer under certain prospectus exemptions set out in in National Instrument 45-106 Prospectus Exemptions (NI 45-106), such as the accredited investor (AI) exemption, are subject to a four-month restricted period before becoming freely tradable. This hold period timeframe was originally put in place to reflect the time required for the dissemination of news in a non-digital capital markets environment. The Report recommends that, for reporting issuers or public companies who distribute securities under the AI prospectus, exemption be subject to a 30 day hold period where the reporting issuer has developed a continuous disclosure record of at least 12 months after filing and obtained a receipt for a prospectus or the filing of a filing statement in the case of a reverse-takeover transaction or Capital Pool Company. Reporting issuers that file their disclosure on a semi-annual basis should be excluded from the reduced hold period. The Report recommends that the 30 day hold period be eliminated altogether after two years. The reporting issuer and any dealer involved in the distribution would still be required to take reasonable steps to ensure that the initial purchaser is properly relying on the AI exemption and is purchasing as a principal and not with a view to further distribution. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommended Changes To Financial Reporting Disclosure](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommended-changes-to-financial-reporting-disclosure/) **Published:** February 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021 the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021 the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The report includes 74 policy recommendations designed to amend securities laws in the following areas: - improving regulatory structure to enhance governance - improving competitiveness through regulatory measures - ensuring a level playing field between large and small market players - improving the proxy system, corporate governance and the process of mergers and acquisitions - fostering innovation - modernizing enforcement and enhancing investor protection Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #14 – Streamline the timing of disclosure** The Report made certain recommendations regarding the requirement for publicly listed companies to provide quarterly financial reporting of interim financial results and accompanying Management Discussion and Analysis (MD&A). The Taskforce recommended changing the requirement for quarterly financial statements to allow for an option for publicly listed reporting issuers to file semi-annual reporting. Reporting issuers would be eligible for this option if the issuer: - has developed a continuous disclosure record of at least 12 months after filing and obtaining a receipt for a final prospectus or filing a filing statement in the case of an reverse takeover or capital pool company; - has annual revenue of less than $10 million, as shown on the audited annual financial statements most recently filed by the reporting issuer; and - is not currently, and has not recently been, in default of their continuous disclosure obligations. If an issuer that has adopted semi-annual filing achieves revenue of $10 million or greater, it would be required to resume quarterly filing following the filing of its audited annual financial statements. In addition, the decision to file on a semi-annual basis must be approved by holders of a majority of shares entitled to vote, excluding any related parties of the issuer, prior to adopting this option and reconfirmed at least every three years. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommended Changes To Dealer Registration Requirements](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommended-changes-to-dealer-registration-requirements/) **Published:** February 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas: - improving regulatory structure to enhance governance - improving competitiveness through regulatory measures - ensuring a level playing field between large and small market players - improving the proxy system, corporate governance and the process of mergers and acquisitions - fostering innovation - modernizing enforcement and enhancing investor protection Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #15 – Dealer Registration “Safe Harbour” for Issuers and “Associated Persons”** Currently if an issuer distributes its own securities with regularity and without the involvement of a registered dealer, the issuer and/or officers, directors, employees or agents of the issuer (Associated Persons), in some circumstances, may be considered in the business of trading securities that “trips” the business trigger and requires registration as a exempt market dealer under National Instrument 31-103 Registration Requirements Exemptions and Ongoing Registrant Regulations (NI 31-103). There is currently some uncertainty among market participants as to when an issuer or its Associated Persons may be considered in the business of trading securities. The Taskforce recommends creating a dealer registration “safe harbour” exemption for issuers and their Associated Persons through an OSC blanket order or rule change that would allow an issuer to engage in certain passive “permitted investor relations activities” (PIRA) without requiring registration. Passive activities may include: - Preparing offering documents and subscription agreements; - Passively offering shares of the issuer to investors through the issuer’s website; and - Passively accepting subscription requests that have not been solicited by the issuer or Associated Persons. According to the Report the effect of implementing this recommendations would be that issuers could conduct some capital raising activities with regularity and without needing to employ the services of a registered dealer. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends Alternative Offering Model For Reporting Issuers](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-alternative-offering-model-for-reporting-issuers/) **Published:** February 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas: - improving regulatory structure to enhance governance - improving competitiveness through regulatory measures - ensuring a level playing field between large and small market players - improving the proxy system, corporate governance and the process of mergers and acquisitions - fostering innovation - modernizing enforcement and enhancing investor protection Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #16 – Alternative Offering Model for Reporting Issuers** According to the Report, the high costs associated with preparing and filing a prospectus can prove to be a barrier to capital-raising for smaller issuers. The purpose of this recommendation is to place greater reliance on a reporting issuer’s continuous disclosure record to support investment decisions rather than the filing of a prospectus for ordinary course financings. Issuers will be able to raise data based on a their continuous disclosure record and a short disclosure document rather than a prospectus. The recommended alternative offering model offers a prospectus exemption for all reporting issuers, with securities listed on an exchange that are in full compliance with their continuous disclosure requirements. The prospectus exemption would include conditions such as: - The issuer must have been a reporting issuer for 12 months; - The issuer must be up to date with its continuous disclosure and not be in default; - Securities offered under this prospectus exemption must be of a class that is listed on an exchange; - The offering must be subject to an annual maximum; and - Issuers must file a short disclosure document with the appropriate regulator to update the continuous disclosure record for recent events (including information regarding the use of proceeds) and certify its accuracy. Both the disclosure document and certificate would be required to be filed on the System for Electronic Document Analysis and Retrieval (SEDAR) or an updated system. The Report recommends that the annual maximum for offerings under this exemption should be set at ten percent of market capitalization as of the beginning of a set annual period. For smaller issuers with a market capitalization under $50 million, the annual maximum should be the lesser of $5 million or 100 percent of the issuer’s market capitalization. Because the remedies for investor losses in secondary market trading for misrepresentations in its continuous disclosure record are more limited than the remedies for a misrepresentation in a prospectus, the Report has recommended that, under this prospectus exemption, an investor should have the right to an effective remedy against the issuer if the offering document used to sell securities contains a misrepresentation with the same liability as under a prospectus offering. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends New “Finder” Category Of Registration](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-new-finder-category-of-registration/) **Published:** February 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas: - improving regulatory structure to enhance governance - improving competitiveness through regulatory measures - ensuring a level playing field between large and small market players - improving the proxy system, corporate governance and the process of mergers and acquisitions - fostering innovation - modernizing enforcement and enhancing investor protection Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #18 – New “Finder” Category of Registration** The Report refers to the practice of issuers using “finders” to conduct non-brokered private placements. According to the Report, acting as a professional finder is generally considered to be a registerable activity since it involves trading in securities with regularity for a business purpose (i.e., the business trigger for registration). The Report also suggests that the definition of a “promoter” in the *Ontario* *Securities Act* is outdated and does not recognize that a person’s status, in terms of whether they are a promoter, may change over time. The Report suggested amendments to NI 31-103 to provide for a new finder registration category that would: - Impose fewer obligations compared to those imposed on exempt market dealers (EMD) (such as lower capital requirements), while maintaining the integrity and proficiency standards that are the cornerstones of investor protection; - Permit finders to engage in solicitation and client-facing conduct and receive transaction-based compensation, while ensuring that sales of securities would be executed through a registered dealer; and - Eliminate the need for a finder to have an ultimate designated person or chief compliance officer since finders would, in substance, perform these functions themselves. Finders would have to comply with conflict of interest and compensation disclosure requirements to maintain fair and efficient capital markets. However, other EMD requirements would be modified such as: - Reduced minimum capital; - Reduced insurance since the finder should be precluded from having access to or custody of client assets; and - Reduced client relationship disclosure. The Report also recommended updating the definition of “promoter “ in the *Ontario Securities Act* to enable the Ontario Securities Commission to designate and make rules regarding promoter status, including: - Defining whether a person or class of persons is or is not a promoter; - Prescribing circumstances in which status as a promoter ends; and - Varying the definition of promoter in specified circumstances to address different organizational structures. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends New Investment Professional Category Of Accredited Investors](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-new-investment-professional-category-of-accredited-investors/) **Published:** February 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas: - improving regulatory structure to enhance governance - improving competitiveness through regulatory measures - ensuring a level playing field between large and small market players - improving the proxy system, corporate governance and the process of mergers and acquisitions - fostering innovation - modernizing enforcement and enhancing investor protection Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #23– New Accredited Investor (AI) Category for Investment Professionals** The Report refers to the current definition of AI in National Instrument 45-106 Prospectus Exemptions (NI 45-106) that includes individuals who meet specific income and net financial asset thresholds and recommends that the AI categories should be expanded to encompass investors who have the proficiency to understand the potential risks of investments. The Taskforce recommended that the AI definition be expanded to include those individuals who have completed and passed relevant proficiency requirements, such as: - the Canadian Securities Course Exam (in conjunction with another proficiency exam); - the Exempt Market Products Exam; - the CFA Charter; or - the Series 7 Exam and the New Entrants Course Exam (as defined in National Instrument 31-103 Registration Requirements Exemptions and Ongoing Registrant Regulations (NI 31-103)). In the view of the Taskforce, if an individual meets the requisite proficiency standard to recommend investment products to other investors, that individual should be capable of making similar investment decisions for themselves. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends Changes To Offering Memorandum Exemption](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-changes-to-offering-memorandum-exemption/) **Published:** February 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas: - improving regulatory structure to enhance governance - improving competitiveness through regulatory measures - ensuring a level playing field between large and small market players - improving the proxy system, corporate governance and the process of mergers and acquisitions - fostering innovation - modernizing enforcement and enhancing investor protection Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #29 – Changes to Offering Memorandum Exemption** The Task Force reported that, after the accredited investor prospectus exemption, the Offering Memorandum (OM) prospectus exemption is the second most relied upon prospectus exemption for individual investors. Notwithstanding this trend, according to the Taskforce, the OM exemption is under-utilized and has recommended changes to the exemption to widen the investor base. The OM prospectus exemption in section 2.9 of National Instrument 45-106 Prospectus Exemptions (NI 45-106) has a $100,000 investment limit and amendments would provide that the re-investment of proceeds from disposition through the OM prospectus exemption to not be counted toward the 12-month preceding $100,000 investment limitation. This recommendation would apply to an eligible investor who is an individual having received advice from a portfolio manager, investment dealer or exempt market dealer, and meets suitability requirements. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends Changes To Liability For Misrepresentations In An Offering Memorandum](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-changes-to-liability-for-misrepresentations-in-an-offering-memorandum/) **Published:** February 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas: - improving regulatory structure to enhance governance - improving competitiveness through regulatory measures - ensuring a level playing field between large and small market players - improving the proxy system, corporate governance and the process of mergers and acquisitions - fostering innovation - modernizing enforcement and enhancing investor protection Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #30 – Changes to Liability for Misrepresentations in an Offering Memorandum** The Taskforce has recommended that the civil liability provisions in the *Ontario Securities Act* for offering memorandum misrepresentations be extended to parties other than the issuer. Under the current law, claims may only be made against the issuer, and not directors or promoters of the issuer. The Report recommends that the board of directors, promoters, influential persons and experts be included as potential litigants. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends Enhanced Environmental, Social And Governance Disclosure Requirements](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-enhanced-environmental-social-and-governance-disclosure-requirements/) **Published:** February 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas: - improving regulatory structure to enhance governance - improving competitiveness through regulatory measures - ensuring a level playing field between large and small market players - improving the proxy system, corporate governance and the process of mergers and acquisitions - fostering innovation - modernizing enforcement and enhancing investor protection Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #32 – ESG Information** The Taskforce has recommend enhanced disclosure of material environmental, social and governance (ESG) information, including forward-looking information, for public issuers. According to the Taskforce, there is increased investor interest in issuers reporting on ESG-related information and, while many issuers provide ESG disclosure, both issuers and investors have expressed concerns about the lack of a standardized framework for this disclosure. According to the Report, the framework that has global support and meets investor needs for concise, standardized metrics on material climate change-related issues is the Taskforce on Climate-Related Financial Disclosures (TCFD) recommendations. The Taskforce recommends mandating disclosure of material ESG information, specifically climate change-related disclosure that is compliant with the TCFD recommendations for issuers through regulatory filing requirements of the OSC. The requirements would apply to all reporting issuers (non-investment fund) and include mandatory disclosure recommended by the TCFD related to governance, strategy and risk management (subject to materiality) on a “comply-or-explain” basis. There would be a transition phase for all issuers to comply with the new disclosure requirements, beginning when the new requirements are implemented. The length of each issuer’s transition phase would depend on the issuer’s market cap at the time the requirements are implemented, with each issuer grouped into one of three market cap tiers that correspond to a certain transition phase. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends Alternative Offering Model For Reporting Issuers](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-alternative-offering-model-for-reporting-issuers-2/) **Published:** February 7, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas: - improving regulatory structure to enhance governance - improving competitiveness through regulatory measures - ensuring a level playing field between large and small market players - improving the proxy system, corporate governance and the process of mergers and acquisitions - fostering innovation - modernizing enforcement and enhancing investor protection Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #16 – Alternative Offering Model for Reporting Issuers** According to the Report, the high costs associated with preparing and filing a prospectus can prove to be a barrier to capital-raising for smaller issuers. The purpose of this recommendation is to place greater reliance on a reporting issuer’s continuous disclosure record to support investment decisions rather than the filing of a prospectus for ordinary course financings. Issuers will be able to raise data based on a their continuous disclosure record and a short disclosure document rather than a prospectus. The recommended alternative offering model offers a prospectus exemption for all reporting issuers, with securities listed on an exchange that are in full compliance with their continuous disclosure requirements. The prospectus exemption would include conditions such as: - The issuer must have been a reporting issuer for 12 months; - The issuer must be up to date with its continuous disclosure and not be in default; - Securities offered under this prospectus exemption must be of a class that is listed on an exchange; - The offering must be subject to an annual maximum; and - Issuers must file a short disclosure document with the appropriate regulator to update the continuous disclosure record for recent events (including information regarding the use of proceeds) and certify its accuracy. Both the disclosure document and certificate would be required to be filed on the System for Electronic Document Analysis and Retrieval (SEDAR) or an updated system. The Report recommends that the annual maximum for offerings under this exemption should be set at ten percent of market capitalization as of the beginning of a set annual period. For smaller issuers with a market capitalization under $50 million, the annual maximum should be the lesser of $5 million or 100 percent of the issuer’s market capitalization. Because the remedies for investor losses in secondary market trading for misrepresentations in its continuous disclosure record are more limited than the remedies for a misrepresentation in a prospectus, the Report has recommended that, under this prospectus exemption, an investor should have the right to an effective remedy against the issuer if the offering document used to sell securities contains a misrepresentation with the same liability as under a prospectus offering. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends Market Participants To Provide Open Data](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-market-participants-to-provide-open-data/) **Published:** February 9, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas improving regulatory structure to enhance governance; improving competitiveness through regulatory measures; ensuring a level playing field between large and small market players; improving the proxy system, corporate governance and the process of mergers and acquisitions; fostering innovation; and modernizing enforcement and enhancing investor protection. Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #32 – Requirement for market participants to provide open data** The Report refers to jurisdictions, including the United Kingdom and the European Union, that mandate open data to increase competition and promote alternatives to consumers giving them choice; while other jurisdictions, such as Japan, India and Singapore, have promoted data sharing arrangements. Open data is defined by the Report as structured data that is machine-readable, freely shared, used and built on. Data governance standards are required to maintain integrity and confidentiality of data. In the view of the Taskforce, many financial technology (FinTech) solutions require open data to create efficiencies and offer better technology solutions for business and services to its customers/investors. The view of the Taskforce is that mandating open data fosters innovation and building technology solutions. The Taskforce proposes that the Ontario Securities Commission’s mandate that capital market participants provide open data so that data sharing arrangements can be further encouraged and facilitate more FinTech solutions for businesses (thereby reducing costs and minimizing duplication of processes) and investors. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends The Prohibition Of Short Selling In Connection With Prospectus Offerings And Private Placements](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-the-prohibition-of-short-selling-in-connection-with-prospectus-offerings-and-private-placements/) **Published:** February 9, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas including regulatory structure to enhance governance; improving competitiveness through regulatory measures; ensuring a level playing field between large and small market players; improving the proxy system, corporate governance and the process of mergers and acquisitions; fostering innovation and modernizing enforcement; and enhancing investor protection. Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #13 – Prohibit short selling in connection with prospectus offerings and private placements** In its Report, the Taskforce addressed the issue of short selling referring to the submissions of multiple stakeholders who advised that short selling in connection with prospectus offerings is making pricing and execution of prospectus offerings more difficult. According to the Task Force, because prospectus offerings are generally priced at a discount to the market price, market participants and investors who expect to purchase under the offering may seek to profit through aggressive short selling prior to the offering to depress the price of the offering. The Report points out that short selling is particularly problematic where the underwriters are engaged in market stabilization in connected with the prospectus offering. The Taskforce recommended that the Ontario Securities Commission (OSC) adopt a rule that would prohibit market participants and investors that have previously sold short securities of the same type as offered under a prospectus or private placement from acquiring securities under the prospectus or private placements which, in the view of the Taskforce, results in greater clarity for all market participants. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Capital Markets Modernization Taskforce Recommends Enhanced Diversity Requirements](https://baxsecuritieslaw.com/ontario-capital-markets-modernization-taskforce-recommends-enhanced-diversity-requirements/) **Published:** February 9, 2021 **Author:** Barbara Hendrickson **Excerpt:** Introduction On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to... **Content:** **Introduction** On January 22, 2021, the Capital Markets Modernization Taskforce (Taskforce) released its final report (Report). The Taskforce was established by the Ontario Provincial Government to help transform the regulatory landscape for the capital markets sector, and advise the Minister of Finance on how to improve the innovation and competitiveness of the Province’s capital markets and best help build Ontario’s economy. The Report includes 74 policy recommendations designed to amend securities laws in the following areas improving regulatory structure to enhance governance; improving competitiveness through regulatory measures; ensuring a level playing field between large and small market players; improving the proxy system, corporate governance and the process of mergers and acquisitions; fostering innovation; and modernizing enforcement and enhancing investor protection Because of the far reaching nature of the numerous recommendations, BAX will do a series of articles over the next few weeks on recommendations of interest to small and midcap issuers and the registrants that service them. **Recommendation #19 – Improve corporate board diversity** The Taskforce refers to the 2014 TSX policy that requires TSX-listed companies to provide disclosure regarding their approach to gender diversity, including data regarding the representation of women on boards of directors and in executive officer positions. The disclosure follows a “comply or explain” model and does not require TSX-listed companies to adopt any gender diversity policies and practices, including targets. The Report refers to Ontario Securities Commission reports that have demonstrated slow progress on the representation of women in these leadership roles at TSX-listed companies. The Taskforce proposes amending securities legislation to require TSX-listed companies to set targets, and annually provide data in relation to the representation of women, black people, Indigenous people, and people of colour (BIPOC), on boards and in executive officer positions. The Taskforce also proposes that legislation should require TSX-listed companies adopt a written policy respecting the director nomination process that expressly addresses the identification of candidates who are women and BIPOC during the nomination process. The Taskforce further proposes to amend securities legislation to set a 10-year maximum tenure limit for directors, with an allowance that 10% of the board can exceed the 10-year maximum for up to two years to deal with the issue of board entrenchment. For a full copy of the Report: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Multilateral Staff Notice 58-312 – Report on Sixth Staff Review of Disclosure regarding Women on Boards and in Executive Officer Positions](https://baxsecuritieslaw.com/csa-multilateral-staff-notice-58-312-report-on-sixth-staff-review-of-disclosure-regarding-women-on-boards-and-in-executive-officer-positions/) **Published:** March 15, 2021 **Author:** Barbara Hendrickson **Excerpt:** On March 10, the securities regulatory authorities in Alberta, Manitoba, Saskatchewan, Ontario, Quebec, New Brunswick, and Nova Scotia published a report outlining key trends from a recent review of public disclosure regarding women on boards and in executive officer positions as required by Form 58-101F1... **Content:** On March 10, the securities regulatory authorities in Alberta, Manitoba, Saskatchewan, Ontario, Quebec, New Brunswick, and Nova Scotia published a report outlining key trends from a recent review of public disclosure regarding women on boards and in executive officer positions as required by Form 58-101F1 Corporate Governance Disclosure (the disclosure requirements) of National Instrument 58-101 Disclosure of Corporate Governance Practices (NI 58-101). The review was completed for the purposes of identifying key trends based on a review sample of 610 issuers that had year-ends between December 31, 2019 and March 31, 2020 (Year 6) and filed information circulars or annual information forms by November 30, 2020. The following key trends were observed: Board seats - Twenty percent of board seats were held by women; however, this number tended to increase with the size of the issuer and varied by industry. - Seventy-nine percent of issuers had at least one woman on their board, however, 127 (21%) issuers had no women on their board. - Six percent of the board chairs were women. - Thirty percent of vacated board seats were filled by women. Executive officer positions - Five percent of issuers had a woman chief executive officer (CEO). - Fifteen percent of issuers had a woman chief financial officer (CFO). - Sixty-five percent of issuers had at least one woman in an executive officer position. Targets - Twenty-six percent of issuers adopted targets for the representation of women on their board. - Four percent of issuers adopted targets for the representation of women in executive officer positions. Term limits and other mechanisms of board renewal - Twenty-three percent of issuers adopted some form of director term limits (alone or with other mechanisms of board renewal). - Thirty-four percnet of issuers adopted other mechanisms of board renewal, but did not adopt term limits. - Thirty-nine percent of issuers disclosed that they did not have director term limits nor had they adopted other mechanisms of board renewal. Policies - Fifty-four percent of issuers adopted a policy relating to the representation of women on their board. Given the results, the CSA will be considering its role in the broader diversity conversation. For a full copy of the notice: [https://www.osc.ca/sites/default/files/2021-03/sn\_20210310\_58-312\_staff-review-women-on-boards.pdf](https://www.osc.ca/sites/default/files/2021-03/sn_20210310_58-312_staff-review-women-on-boards.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Notice 51-362 Staff Review of COVID-19 Disclosures and Guide for Disclosure Improvements](https://baxsecuritieslaw.com/csa-notice-51-362-staff-review-of-covid-19-disclosures-and-guide-for-disclosure-improvements/) **Published:** March 15, 2021 **Author:** Barbara Hendrickson **Excerpt:** On February 25, 2021, the Canadian Securities Administrators (CSA) published key findings of recently completed reviews of issuers’ COVID-19 disclosure to explain the impact of COVID-19 on their industry, operations, customers and suppliers (notice). CSA staff identified some areas where disclosure could be improved, including... **Content:** On February 25, 2021, the Canadian Securities Administrators (CSA) published key findings of recently completed reviews of issuers’ COVID-19 disclosure to explain the impact of COVID-19 on their industry, operations, customers and suppliers (notice). CSA staff identified some areas where disclosure could be improved, including issuers needing to provide more discussion of entity-specific measures taken to reduce the COVID-19 impact on their business. The review also revealed instances where issuers provided unbalanced or overly promotional disclosure, as well as isolated instances of non-compliance of non GAAP measures and forward-looking information. The notice reports that there is no “one size fits all” model for issuers to follow when assessing the disclosure implications of COVID-19 and emphasized that, in addition to continuous disclosure on COVID-19 being transparent and balanced, it should provide an understanding of: - The current and expected impact of COVID-19 on the issuer’s operations and financial condition, including liquidity and capital resources. - The key risks that the COVID-19 pandemic presents to the issuer. - Known trends, demands, events or uncertainties related to COVID-19 that management reasonably believes will materially affect the issuer’s future revenues, expenses or projects. - The operational changes and other measures taken by management in response to COVID19. - How COVID-19 has impacted the issuer’s capacity to meet working capital requirements, debt covenants, planned growth or funding of future development activities and capital expenditures. - How the COVID-19 pandemic has impacted areas of financial reporting subject to significant judgement and measurement uncertainty in the current environment. - How the issuer has assessed impairment of non-financial assets given the extended impact of the COVID-19 pandemic. - Where applicable, sensitivity analysis and disclosures relating to key assumptions will be especially important and should be both realistic and supportable. For a full copy of the notice: [https://www.osc.ca/sites/default/files/2021-02/csa\_20210225\_51-362\_staff-review-covid19.pdf](https://www.osc.ca/sites/default/files/2021-02/csa_20210225_51-362_staff-review-covid19.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Observations on Disclosure of Crypto Asset Reporting Issuers CSA Notice 51-363](https://baxsecuritieslaw.com/observations-on-disclosure-of-crypto-asset-reporting-issuers-csa-notice-51-363/) **Published:** March 15, 2021 **Author:** Barbara Hendrickson **Excerpt:** On March 11, 2021, the Canadian Securities Administrators (CSA) published a staff notice regarding continuous disclosure and other public filings for reporting issuers with crypto and digital assets including cryptocurrencies, tokens, stablecoins, and other digital assets relying on blockchain technology who engage materially with crypto... **Content:** On March 11, 2021, the Canadian Securities Administrators (CSA) published a staff notice regarding continuous disclosure and other public filings for reporting issuers with crypto and digital assets including cryptocurrencies, tokens, stablecoins, and other digital assets relying on blockchain technology who engage materially with crypto assets via mining and/or the holding/ trading of those assets (crypto asset reporting issuers or issuers). **Safeguarding of Crypto Assets** The notice provides that, where crypto asset reporting issuers self-custody their crypto assets, including multi-signature wallets, safeguarding of private keys, the use of “cold wallets” and frequent monetization of crypto assets into fiat currency, adequate disclosure of the controls and risks must be made in public filings. According to the notice, the controls that are appropriate vary depending on its size and the type and quantity of crypto assets held, as well as the frequency for which they move to and from “hot wallets” or liquidate the crypto assets. The controls that are appropriate for a given issuer may vary depending on its size and the type and quantity of crypto assets held, as well as the frequency for which they move to and from “hot wallets” or liquidate the crypto assets. Where issuers do not retain a third-party custodian, the issuer should disclose the reasons for not doing so. According to the notice, for crypto asset reporting issuers who retain a third-party custodian to safeguard all or a substantial portion of their crypto assets, the following information would be material to investors: - the identity and location of the third-party custodian; - if the third-party custodian has appointed a sub-custodian to hold certain crypto assets, the identity and location of the sub-custodian(s); - a general discussion of the services provided to the issuer by the third-party custodian (e.g., is the custodian a payment processor or just responsible for holding/ safeguarding the crypto assets); - whether the custodian is a Canadian financial institution (as defined in NI 45-1065 ) or a foreign equivalent, and if so by whom the custodian is regulated; - whether the issuer is aware of anything with regards to the custodian’s operations that would adversely affect the issuer’s ability to obtain an unqualified audit opinion on its audited financial statements; - whether the custodian is a related party of the issuer; - the quantity or percentage of the issuer’s crypto assets held by the custodian as at each reporting period end date; - whether the crypto assets held by the custodian are insured and any limitations on the custodian’s liability in the event of the loss or theft of the issuer’s crypto assets; - any known security breaches or other similar incidents involving the custodian as a result of which crypto assets have been lost or stolen; - the treatment of the assets in the event of an insolvency or bankruptcy of the custodian, and - if the custodian operates in a foreign jurisdiction, what due diligence the issuer has performed on the custodian (including the issuer’s ability to: effectively monitor the custodian and execute contingency plans and exit strategies with minimal impact on the issuer’s operation). Where crypto asset reporting issuers that self custody their crypto assets, according to the notice, the following information would be material to investors: - a description of the controls implemented to protect the crypto assets against the risk of loss and/or theft associated with holding crypto assets, - whether the issuer employs multi-signature wallets, - the manner in which private keys are safeguarded, including the nature and extent of the use of “cold wallets”, - whether the issuer’s crypto assets are insured, and any exclusions contained in the insurance policy that would prevent the issuer from making a successful claim in the event that the crypto assets are lost or stolen, - measures taken to mitigate cyber security risks, and - the frequency of monetization of crypto assets into fiat currency. **Use of Crypto Asset Trading Platforms** According to the notice, to the extent that an issuer relies on a crypto asset trading platform to hold its crypto assets, the issuer should disclose, at a minimum, all the items referenced in the “Safeguarding of Crypto Assets” above and in sufficient detail to enable investors to make an informed decision about whether to buy, sell or hold the issuer’s securities. **Description of Business** According to the notice, the description of the issuer’s business in its continuous disclosure filings should include information on how the business intends to generate revenue, the specialized skill and knowledge possessed by the issuer, the competitive conditions faced by the issuer and the sources, pricing and availability of equipment used by the issuer, and any reliance on third-party service providers (e.g. trading platforms, mining pool operators, liquidity providers, etc.). ***Risk Factor Disclosure*** Risk factor disclosure, according to the notice, should include, among many others, risks pertaining to: (i) the availability and/or cost of electricity; (ii) potential declines in the price of crypto assets; (iii) decreased rewards for mining a particular crypto asset, and (iv) risks related to access to crypto assets held at third-party custodians and crypto asset trading platforms. The notice points out that risks related to different forms of crypto assets may differ, for example, Bitcoin or Ether, compared to other digital assets, such as digital tokens. ***Promotional Activities*** The notice states that crypto asset reporting issuers should not engage in promotional activities that provide unbalanced or unsubstantiated material claims about the issuer’s business and the corresponding opportunity for profit by investing in the issuer and be supported by objective data. ***Material Changes*** The notice points to the following examples of crypto asset reporting issuers failing to file material change reports: (i) entering into a custodial agreement with a third- party; (ii) changing custodians; (iii) the loss or theft of crypto assets; (iv) an acquisition or sale of crypto asset mining equipment, or (v) entering into a mining pool arrangement or an electricity supply agreement by a crypto asset mining issuer if the arrangement is significant in relation to the issuer’s existing operations. ***Issuers whose Business is Investing in Crypto Assets*** According to the notice, if a material aspect of an issuer’s business is investing in crypto assets and the issuer does not have other substantial operations, despite the fact that the issuer may not meet the definition of an investment fund, many of the investor protection considerations applicable to investment funds may apply. ***Financial Statements/Auditing Issues*** The notice refers to the unique aspects of the crypto asset industry that raise novel accounting issues and outlines considerations that apply to holdings of crypto currencies and refers to the IFRS Interpretations Committee published its agenda decision on *Holdings of Cryptocurrencies* in June 2019. The notice also refers to certain novel auditing challenges have arisen in the context of the crypto asset industry and encourages crypto asset reporting issuers, and their audit committees and advisors, to review guidance that has been published by the Chartered Professional Accountants of Canada and communications from the Canadian Public Accountability Board. For a full copy of the notice: [51-363 – Observations on Disclosure by Crypto Assets Reporting Issuers \[CSA Staff Notice\]](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/5-ongoing-requirements-for-issuers-insiders/current/51-363/51363-csa-staff-notice-march-11-2021). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Staff Notice 41-307 (Revised) Concerns regarding an issuer’s financial condition and the sufficiency of proceeds from a prospectus offering](https://baxsecuritieslaw.com/csa-staff-notice-41-307-revised-concerns-regarding-an-issuers-financial-condition-and-the-sufficiency-of-proceeds-from-a-prospectus-offering/) **Published:** May 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** On March 25, 2021, the Canadian Securities Administrators (CSA) published Staff Notice 41-307 (Revised) Concerns regarding an issuer’s financial condition and the sufficiency of proceeds from a prospectus offering (Notice). The Notice alerts alert issuers (other than investment fund issuers) and their advisors about the... **Content:** On March 25, 2021, the Canadian Securities Administrators (CSA) published Staff Notice 41-307 (Revised) *Concerns regarding an issuer’s financial condition and the sufficiency of proceeds from a prospectus offering* (Notice). The Notice alerts alert issuers (other than investment fund issuers) and their advisors about the CSA approach where there are concerns regarding the financial condition of an issuer and/or the sufficiency of proceeds in the context of a prospectus offering. According to the Notice, these concerns will affect the ability of securities commissions to recommend that a receipt be issued for a prospectus. This Notice applies to all prospectus reviews, regardless of whether the offering is an IPO new issue or secondary offering. The Notice describes issues that have arisen in past prospectus reviews and explains the types of comments raised about an issuer’s financial condition and/or the sufficiency of proceeds. As well, the Notice indicates that securities commissions may refuse to issue a receipt for a prospectus on the basis that it is not in the public interest where proceeds from the prospectus offering, along with the issuer’s other resources, will be insufficient to accomplish the purpose of the issue stated in the prospectus (the sufficiency of proceeds receipt refusal provision). The Notice states that a prospectus must contain clear disclosure on how an issuer intends to use the proceeds raised in the offering as well as disclosure of the issuer’s financial condition, including any liquidity concerns. In some circumstances, this type of disclosure, on its own, may not be sufficient to satisfy receipt refusal concerns such as where an issuer lacks sufficient funds to continue operations, or if the proceeds from the prospectus offering will be insufficient to accomplish the purpose of the offering. According to the Notice when conducting prospectus reviews, anticipated proceeds from a prospectus offering to be insufficient if they are raised: - for a specific purpose but do not address the issuer’s short-term liquidity requirements; - through a best efforts offering without a minimum subscription, or a minimum subscription that does not appear to be sufficient to satisfy the issuer’s short-term liquidity requirements, or - through a shelf prospectus offering that can be drawn down in small increments that, when considered separately, may not be sufficient to satisfy the issuer’s short-term liquidity requirements. For a copy of the Notice: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Joint CSA/IIROC Staff Notice 21-329 - Guidance for Crypto-Asset Trading Platforms: Compliance with Regulatory Requirements](https://baxsecuritieslaw.com/joint-csa-iiroc-staff-notice-21-329-guidance-for-crypto-asset-trading-platforms-compliance-with-regulatory-requirements/) **Published:** May 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** On March 29, 2021, the Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) published a Notice to provide guidance on how securities legislation applies to platforms (Crypto Asset Trading Platforms) that facilitate or propose to facilitate the trading of: crypto... **Content:** On March 29, 2021, the Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) published a Notice to provide guidance on how securities legislation applies to platforms (Crypto Asset Trading Platforms) that facilitate or propose to facilitate the trading of: - crypto assets that are securities (Security Tokens), or - instruments or contracts involving crypto assets (Crypto Contracts). The Notice does not introduce new rules specifically applicable to Crypto Asset Trading Platforms; rather, it provides guidance on how the existing requirements of securities legislation may be tailored through terms and conditions on the registration or recognition of Crypto Asset Trading Platforms and through discretionary exemptive relief with appropriate conditions. This Notice discusses Crypto Asset Trading Platforms that operate in a manner similar to marketplaces and other Crypto Asset Trading Platforms that are in the business of trading Security Tokens or Crypto Contracts that are not marketplaces but are dealers. In some situations, a Crypto Asset Trading Platform may be carrying out activities that have elements of both marketplaces and dealers. The Notice sets out how existing regulatory requirements could apply to these Crypto Asset Trading Platforms. The Notice focuses on Crypto Asset Trading Platforms that facilitate the trading of Security Tokens and/or Crypto Contracts. There may be platforms that facilitate the trading of other products or contracts that are structured as “traditional” derivatives and that also provide exposure to crypto assets (including commodity futures contracts, contracts for difference or swaps). In the Notice, the CSA and IIROC encourage market participants to consult with their legal counsel and to contact staff of their local securities regulatory authority on the appropriate steps to comply with securities legislation and IIROC rules. The Notice warns that securities commissions may take new enforcement actions or continue existing actions against Crypto Asset Trading Platforms that do not and/or have not complied with Canadian securities legislation. For a copy of the Notice: [https://www.iiroc.ca/Documents/2021/12d84d32-7a4b-4f81-b864-cb65f5ffd93b\_en.pdf](https://www.iiroc.ca/Documents/2021/12d84d32-7a4b-4f81-b864-cb65f5ffd93b_en.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BC Notice 2021/02 Clarification of Requirements for Crypto Asset Trading Platforms](https://baxsecuritieslaw.com/bc-notice-2021-02-clarification-of-requirements-for-crypto-asset-trading-platforms/) **Published:** May 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** On April 7, 2021, the British Columbia Securities Commission (BCSC) published BC Notice 2021/02 Clarification of Requirements for Crypto Asset Trading Platforms Vancouver – to clarify expectations for crypto asset trading platforms (platforms) (Notice) operating in British Columbia in light of Joint Staff Notice 21-329,... **Content:** On April 7, 2021, the British Columbia Securities Commission (BCSC) published BC Notice 2021/02 *Clarification of Requirements for Crypto Asset Trading Platforms Vancouver – to clarify expectations for crypto asset trading platforms (platforms)* (Notice) operating in British Columbia in light of Joint Staff Notice 21-329, Guidance for Crypto-Asset Trading Platforms: Compliance with Regulatory Requirements (CSA Staff Notice 21-329), issued March 29, 2021 by the Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC). The Notice provides that platforms headquartered in British Columbia that facilitate trading in crypto assets that are securities or derivatives, or in instruments or contracts based on crypto assets, are required to contact the BCSC to ensure appropriate regulatory authorization. The Notice also refers to CSA Staff Notice 21-327 *Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets* for more guidance. For platforms operating in British Columbia but headquartered in another Canadian province or territory, the Notice states that the platform is required to communicate with its principal securities regulator in that jurisdiction. The Notice suggests that platforms based outside of Canada, but dealing with Canadians, should reach out to the Canadian jurisdiction with which it has the most significant connection. According to the Notice, the BCSC remains flexible and will consider a range of potential regulatory solutions to find an appropriate resolution for each platform. One option, according to the Notice, is pursuing membership with IIROC but the BCSC will also consider other regulatory arrangements where warranted, such as tailored exemptive relief, that do not require IIROC membership. Platforms operating in British Columbia should consult with their legal counsel and contact the BCSC on the appropriate steps to comply with securities legislation, as applicable. CSA Staff Notice 21-329 provides guidance on securities law requirements applicable to platforms. The Notice warns that the BCSC will pursue enforcement action against platforms that are not complying with securities regulations. For a full copy of the Notice: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Alberta and Saskatchewan publish Proposed Multilateral Notice 45-539 Proposed Prospectus Exemption for Small Business Financing](https://baxsecuritieslaw.com/alberta-and-saskatchewan-publish-proposed-multilateral-notice-45-539-proposed-prospectus-exemption-for-small-business-financing/) **Published:** May 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** On March 25, 2021, the Alberta Securities Commission (ASC) and the Financial and Consumer Affairs Authority of Saskatchewan (FCAA) published Multilateral Notice and Request for Comment 45-539 Proposed Prospectus Exemption for Small Business Financing. The proposed new small business financing prospectus exemption would allow Alberta and Saskatchewan... **Content:** On March 25, 2021, the Alberta Securities Commission (ASC) and the Financial and Consumer Affairs Authority of Saskatchewan (FCAA) published Multilateral Notice and Request for Comment 45-539 *Proposed Prospectus Exemption for Small Business Financing*. The proposed new small business financing prospectus exemption would allow Alberta and Saskatchewan businesses to raise up to $5 million from investors in those provinces who would not qualify to invest under other prospectus exemptions. The exemption contemplates the use of a simple, streamline offering document with tiered offering and investment limits depending on whether financial statements are provided to investors. Details of the proposal are set out in Canadian Securities Administrators Multilateral Notice and Request for Comment 45-539 *Proposed Prospectus Exemption for Small Business Financing*. The comment period expires on May 7, 2021. For a full copy of the Notice: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [The ASC and the FCAA publishes proposed CSA Multilateral Notice of Implementation 45-538 Self-Certified Investor Prospectus](https://baxsecuritieslaw.com/the-asc-and-the-fcaa-publishes-proposed-csa-multilateral-notice-of-implementation-45-538-self-certified-investor-prospectus/) **Published:** May 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** On March 31, 2021, the Alberta Securities Commission (ASC) and the Financial and Consumer Affairs Authority of Saskatchewan (FCAA) adopted a new prospectus exemption CSA Multilateral Notice of Implementation 45-538 Self-Certified Investor Prospectus Under the new prospectus, exemption investors who certify to having certain financial and... **Content:** On March 31, 2021, **t**he Alberta Securities Commission (ASC) and the Financial and Consumer Affairs Authority of Saskatchewan (FCAA) adopted a new prospectus exemption CSA Multilateral Notice of Implementation 45-538 *Self-Certified Investor Prospectus* Under the new prospectus, exemption investors who certify to having certain financial and investment knowledge, and acknowledge that they understand certain investment considerations and risks, are permitted to invest alongside accredited investors. Self-certified investors are limited, in a calendar year, to investments of $10,000 in any one issuer and $30,000 across multiple businesses. The investment limits will not apply to an investment in an issuer listed on a Canadian stock exchange that is complying with its ongoing reporting obligations, provided that the investor has received suitability advice with respect to the investment. The exemption is being implemented on a three-year pilot basis. For a copy of the New Rule: [https://www.albertasecurities.com/-/media/ASC-Documents-part-1/Regulatory-Instruments/2021/03/5954938-v1-Multilateral\_CSA\_Notice\_Prospecus\_Exemption\_re\_Bkt\_Order\_45-538.ashx](https://www.albertasecurities.com/-/media/ASC-Documents-part-1/Regulatory-Instruments/2021/03/5954938-v1-Multilateral_CSA_Notice_Prospecus_Exemption_re_Bkt_Order_45-538.ashx) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson speaks at Law Society of Ontario Conference - Emerging Issues in Directors’ and Officers’ Liability 2021](https://baxsecuritieslaw.com/barbara-hendrickson-speaks-at-law-society-of-ontario-conference-emerging-issues-in-directors-and-officers-liability-2021/) **Published:** May 4, 2021 **Author:** Barbara Hendrickson **Excerpt:** On April 21, 2021, Barbara Hendrickson spoke at a virtual conference sponsored by the Law Society of Ontario on “The COVID Pandemic: Implications for Directors and Officers”. To view the PowerPoint presentation: The COVID Pandemic: Implications for Directors and OfficersDownload For more information, please call... **Content:** On April 21, 2021, Barbara Hendrickson spoke at a virtual conference sponsored by the Law Society of Ontario on “The COVID Pandemic: Implications for Directors and Officers”. **To view the PowerPoint presentation:** [The COVID Pandemic: Implications for Directors and Officers](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2021/05/LSO-May-2-2021-LSO-COVID.pptx)[Download](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2021/05/LSO-May-2-2021-LSO-COVID.pptx) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators adopt new nationally harmonized start-up crowdfunding rules](https://baxsecuritieslaw.com/canadian-securities-regulators-adopt-new-nationally-harmonized-start-up-crowdfunding-rules/) **Published:** June 29, 2021 **Author:** Barbara Hendrickson **Excerpt:** On June 23, 2021, the Canadian Securities Administrators (CSA) harmonized rules for securities crowdfunding. National Instrument 45-110 Start-up Crowdfunding Registration and Prospectus Exemptions (Start-up Crowdfunding Rule) introduces a single, uniform set of rules that replaces and enhances the requirements currently in effect in, British Columbia, Alberta, Saskatchewan, Manitoba,... **Content:** On June 23, 2021, the Canadian Securities Administrators (CSA) harmonized rules for securities crowdfunding. National Instrument 45-110 *Start-up Crowdfunding Registration and Prospectus Exemptions* (Start-up Crowdfunding Rule) introduces a single, uniform set of rules that replaces and enhances the requirements currently in effect in, British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, and Nova Scotia. The Start-up Crowdfunding Rule provides a harmonized national framework to facilitate securities crowdfunding for start-ups and early stage issuers. NI 45-110 provides an exemption: - from the prospectus requirement (the start-up crowdfunding prospectus exemption) that allows an issuer to distribute eligible securities through an online funding portal; and - from the dealer registration requirement for funding portals that facilitate online distributions by issuers relying on the start-up crowdfunding prospectus exemption. **Eligible securities that can be distributed under the prospectus exemption** Eligible securities include common shares; non-convertible preference shares; securities convertible into common shares or non-convertible; preference shares; non-convertible debt securities; linked to a fixed or floating; interest rate; units of limited partnerships; and shares in the capital of an association. **Maximum aggregate proceeds that can be raised by the issuer group under the prospectus exemption** The maximum total amount that an issuer can raise under the crowdfunding prospectus exemption in a 12-month period has been increased to $1.5 million. **Maximum investment amount per person per distribution under the prospectus exemption** The maximum investment a purchaser can make in an offering to $2,500, with a higher limit of $10,000 if a registered dealer advises that the investment is suitable for the purchaser. **Confirmation by the regulator before a funding portal starts to facilitate distributions** The funding portal must deliver the required forms at least 30 days before facilitating distributions. There is no requirement for the regulator’s written confirmation. However, a funding portal may not rely on the start-up crowdfunding registration exemption if, within 30 days of receiving the funding portal information form, the regulator has notified the funding portal or any of its principals that its process and procedure for handling of purchasers’ funds does not satisfy the conditions of the instrument. **Bad actor disqualification** A funding portal cannot rely on the start-up crowdfunding registration exemption if it or any of its principals is or has been the subject of certain proceedings in the last ten (10) years related to a claim based in whole or in part on various conduct such fraud, theft, breach of trust, or allegations of similar conduct. **Funding portals financial resources certification** On a semi-annual basis, the funding portal must certify that it has, or expects to have, sufficient financial resources to continue its operations for at least the next six (6) months by delivering a completed funding portal information form or Form 45-110F5 *Semi-Annual Financial Resources Certification.* **Liability in the event the offering document contains misrepresentations** The issuer is subject to statutory liability similar to the offering memorandum exemption under section 2.9 of NI 45-106. **Investment in an unspecified business** The start-up crowdfunding prospectus exemption is not available to issuers who: - have no operations other than to identify and evaluate assets or a business with a view to completing an investment in, merger with, amalgamation with or acquisition of a business, or a purchase of the securities of one or more other issuers; or - intend to use the proceeds of the distribution to invest in, merge with or acquire an unspecified business. **Report of exempt distribution form** Issuers must use Form 45-106F1 Provided all necessary ministerial approvals are obtained, the Start-up Crowdfunding Rule and the consequential amendments will come into force September 21, 2021. For the Notice please see: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BCSC tackles stock promotions with proposal for greater disclosure](https://baxsecuritieslaw.com/bcsc-tackles-stock-promotions-with-proposal-for-greater-disclosure/) **Published:** June 29, 2021 **Author:** Barbara Hendrickson **Excerpt:** On May 26, 2021, the British Columbia Securities Commission (BCSC) published for comment a new rule that is designed to make promotions of companies with a connection to British Columbia to become more transparent. According to the BCSC, the new rules are designed to enable... **Content:** On May 26, 2021, the British Columbia Securities Commission (BCSC) published for comment a new rule that is designed to make promotions of companies with a connection to British Columbia to become more transparent. According to the BCSC, the new rules are designed to enable people to better evaluate the reliability of statements that encourage investment in issuers of securities, often made with the aim of driving up an issuer’s share price. The rules would apply to newsletters, financial blogs, emails, oral statements, social media posts, videos or any other communications, in any platform or medium, and would require promotional communications to disclose: - The name of the issuer on whose behalf the promotion is being conducted; - Compensation being paid for the promotion; - Whether the person conducting the promotion owns securities or derivatives related to the issuer; - Where the promotion is taking place; and - Any other facts that would interfere with the objectivity of the person doing the promotion. The proposed requirements – the first of their kind in Canada – stem from *Securities Act* amendments that give the BCSC greater power to regulate promotional activity, which is sometimes conducted by issuers, by shareholders, and by third parties. The BCSC can now regulate promotional activity regardless of whom is actually conducting it. The new requirements would apply to all promotional activity that occurs in, or has a real or substantial connection to, BC, with certain exceptions. The BCSC is also proposing a couple of other requirements for venture issuers, as defined in the proposed BC instrument: - A venture issuer that outsources promotions would have to issue a news release specifying who it retained, the platforms on which the promotion will appear, and the compensation paid for the promotion. If a significant change occurs to any of this information, the issuer would have to issue an updated news release. - A venture issuer with promotional activity exceeding ten per cent of its total operating expenses in a year (or interim period) would have to disclose those expenditures in its interim and annual reports. “Some companies have a legitimate need to engage in promotional activities and they should have no trouble complying with the proposed rules,” Brady said. “But abusive stock promotions are a scourge that go hand in hand with abusive trading, and the new rules would give us one more tool to tackle them.” The BCSC is seeking comments on the proposed rules by July 26, 2021. Please see the Notice at: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators sign fintech co-operation agreement with the Financial Services Commission, Mauritius](https://baxsecuritieslaw.com/canadian-securities-regulators-sign-fintech-co-operation-agreement-with-the-financial-services-commission-mauritius/) **Published:** June 29, 2021 **Author:** Barbara Hendrickson **Excerpt:** On June 23, 2021, certain members of the Canadian Securities Administrators (CSA) signed a fintech co-operation agreement with the Financial Services Commission, Mauritius (FSC Mauritius). The members are the securities regulatory authorities in British Columbia, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, and Nova Scotia. Notably... **Content:** On June 23, 2021, certain members of the Canadian Securities Administrators (CSA) signed a fintech co-operation agreement with the Financial Services Commission, Mauritius (FSC Mauritius). The members are the securities regulatory authorities in British Columbia, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, and Nova Scotia. Notably the agreement includes a referral mechanism for innovative businesses, and enhances and clearly defines information-sharing between these jurisdictions. For the press release please see: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators seek comment on proposal to streamline continuous disclosure requirements](https://baxsecuritieslaw.com/canadian-securities-regulators-seek-comment-on-proposal-to-streamline-continuous-disclosure-requirements/) **Published:** June 29, 2021 **Author:** Barbara Hendrickson **Excerpt:** On May 20, 2021, the Canadian Securities Administrators (CSA) published changes to the continuous disclosure requirements for non-investment fund reporting issuers. The proposed amendments: Streamline and clarify certain disclosure requirements in the management’s discussion and analysis (MD&A) and the annual information form (AIF) for non-investment... **Content:** On May 20, 2021, the Canadian Securities Administrators (CSA) published changes to the continuous disclosure requirements for non-investment fund reporting issuers. The proposed amendments: - Streamline and clarify certain disclosure requirements in the management’s discussion and analysis (MD&A) and the annual information form (AIF) for non-investment fund reporting issuers. - Eliminate certain requirements that are redundant or no longer applicable. - Combine the financial statements, MD&A and, where applicable, AIF into one reporting document called the annual disclosure statement for annual reporting purposes, and the interim disclosure statement for interim reporting purposes. - Introduce a small number of new requirements to address gaps in disclosure. The CSA is also consulting on a proposed framework for semi-annual reporting on a limited basis. The framework would allow venture issuers that are not SEC issuers the choice of reporting on a semi-annual rather than a quarterly basis. Alternative disclosure would be required for interim periods where financial statements and MD&A would not be filed. While no rule is being published for comment at the present time, the CSA is soliciting public comment on whether rules consistent with the proposed framework could further reduce regulatory burden for these issuers while still providing investors with adequate information to make informed decisions. Please see the media release at . For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators publish final rule for non-GAAP and other financial measures](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-final-rule-for-non-gaap-and-other-financial-measures/) **Published:** June 29, 2021 **Author:** Barbara Hendrickson **Excerpt:** On May 27, 2021, the Canadian Securities Administrators (CSA) today published disclosure requirements for issuers that disclose non-GAAP (generally accepted accounting principles) and other financial measures on a voluntary basis )National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure (NI 52-112)). NI 52-112, according to the CSA,... **Content:** On May 27, 2021, the Canadian Securities Administrators (CSA) [today published](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/5-ongoing-requirements-for-issuers-insiders/current/52-112/52112-csa-notice-of-publication-may-27-2021) disclosure requirements for issuers that disclose non-GAAP (generally accepted accounting principles) and other financial measures on a voluntary basis )National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure (NI 52-112)). NI 52-112, according to the CSA, improves the quality of information provided to investors for various financial measures that commonly lack standardized meaning. NI 52-112 will: - Apply to all reporting issuers, except investment funds and certain foreign issuers; - Apply to non-reporting issuers for certain offering documents and transactions; - Require specified disclosure for certain financial measures presented outside the financial statements, such as non-GAAP financial measures and supplementary financial measures, (as defined in the final rule); and - Apply to disclosures for a financial year ending on or after October 15, 2021 (for reporting issuers) and for certain offering documents or transactions filed after December 31, 2021 (for non-reporting issuers). The final rule incorporates feedback to clarify and streamline the application and disclosure requirements. Prior to adopting the final rule, issuers should continue to refer to Staff Notice 52-306 (Revised) Non-GAAP Financial Measures, which will be withdrawn when transition to the final rule is complete. The final rule will come into effect on August 25, 2021. Please see: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [TSXV Temporary Relief of $0.05 Minimum Pricing Requirement – Further Extension](https://baxsecuritieslaw.com/tsxv-temporary-relief-of-0-05-minimum-pricing-requirement-further-extension/) **Published:** June 29, 2021 **Author:** Barbara Hendrickson **Excerpt:** On June 17, 2021, the TSX Venture Exchange (the “Exchange”) followed up on a previously issued bulletin (the “April 8, 2020 Bulletin”) that provided notice that, in response to the COVID-19 pandemic, the Exchange would provide temporary relief (the “Temporary Relief”) from certain requirements of... **Content:** On June 17, 2021, the TSX Venture Exchange (the “Exchange”) followed up on a previously issued bulletin (the “April 8, 2020 Bulletin”) that provided notice that, in response to the COVID-19 pandemic, the Exchange would provide temporary relief (the “Temporary Relief”) from certain requirements of the Exchange’s Corporate Finance Manual as described in more detail in the April 8, 2020 Bulletin. In summary, the purpose of the April 8, 2020 Bulletin was to revise the minimum price at which listed shares may be issued from $0.05 to $0.01 in certain circumstances. If the market price of an issuer’s listed shares not greater than $0.05, the minimum price at which that issuer may issue its listed shares in particular circumstances is equal to that market price, subject to a minimum price of $0.01. If the market price of an issuer’s listed shares is greater than $0.05, the minimum price at which that issuer may issue its listed shares remains equal to the market price less the existing allowable maximum discounts based on closing price, subject to a minimum price of $0.05. In the case of any discrepancy, the details of the Temporary Relief set out in the April 8, 2020 Bulletin prevail. The April 8, 2020 Bulletin stipulates that such Temporary Relief applies to listed shares that are issued on or before September 30, 2020. That deadline was previously extended to June 30, 2021. The Exchange now wishes to provide notice that it is extending the Temporary Relief such that it will apply to listed shares that are issued on or before December 31, 2021. The bulletin may be found at the following link: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Position Paper 25-404 - New Self-Regulatory Organization Framework](https://baxsecuritieslaw.com/csa-position-paper-25-404-new-self-regulatory-organization-framework/) **Published:** August 19, 2021 **Author:** Barbara Hendrickson **Excerpt:** On August 3, 2021, the Canadian Securities Administrators (CSA) released a framework for replacing the two major Canadian Self- Regulatory Organizations (SROs) – the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association (MFDA) with a single regulatory entity (Position Paper).... **Content:** On August 3, 2021, the Canadian Securities Administrators (CSA) released a framework for replacing the two major Canadian Self- Regulatory Organizations (SROs) – the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association (MFDA) with a single regulatory entity (Position Paper). The CSA has decided to move forward to implement a new single enhanced SRO (New SRO) and, separately, to consolidate the two current investor protection funds (IPFs) into a single protection fund (New IPF) that will be independent from the New SRO. - The process to establish and operationalize the New SRO and New IPF will have two phases. Phase 1 will focus on the design of the New SRO and the New IF, the integration of the existing SROs and IPFs under the new framework and the adoption of the issue-specific solutions detailed in the Position Paper. - Phase 2 will consider whether it is appropriate to incorporate into the New SRO other registration categories, including Portfolio Managers, Exempt Market Dealers and Scholarship Plan Dealers, which are currently overseen by the statutory regulators. Possible modifications to the New IPF (e.g., extending coverage to other registration categories) will also be considered. See For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [The CSA sign Fintech co-operation agreement with the Securities and Futures Commission of Hong Kong](https://baxsecuritieslaw.com/the-csa-sign-fintech-co-operation-agreement-with-the-securities-and-futures-commission-of-hong-kong/) **Published:** August 19, 2021 **Author:** Barbara Hendrickson **Excerpt:** On July 8, 2021, the Canadian Securities Administrators (CSA) signed an innovative functions co-operation agreement with the Securities and Futures Commission of Hong Kong (SFC). The members are the securities regulatory authorities in British Columbia, Alberta,  Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick and Nova Scotia.... **Content:** On July 8, 2021, the Canadian Securities Administrators (CSA) signed an innovative functions co-operation agreement with the Securities and Futures Commission of Hong Kong (SFC). The members are the securities regulatory authorities in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick and Nova Scotia. The agreement extends the work of the CSA Regulatory Sandbox, an initiative of the CSA to support fintech businesses seeking to offer innovative products, services and applications in Canada as well as the work of SFC’s’ Fintech Contact Point to enhance communication with businesses involved in the development and application of fintech which intend to conduct regulated activities in Hong Kong. Notably, it includes a referral mechanism for innovative businesses, and enhances and clearly defines the scope of information-sharing between these jurisdictions. See . For more information please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Notice and Request for Comment: Proposed Changes to Companion Policy 41-101CP to National Instrument 41-101 General Prospectus Requirements Related to Financial Statement Requirements](https://baxsecuritieslaw.com/csa-notice-and-request-for-comment-proposed-changes-to-companion-policy-41-101cp-to-national-instrument-41-101-general-prospectus-requirements-related-to-financial-statement-requirements/) **Published:** August 19, 2021 **Author:** Barbara Hendrickson **Excerpt:** On August 12, 2021, the Canadian Securities Administrators (CSA) are published for a 60-day comment period proposed changes (the Proposed Changes) National Instrument 41-101 General Prospectus Requirements (41-101CP)  and its Companion Policy 41-101CP. The proposed changes will amend Form 41-101F1 Information Required in a Prospectus... **Content:** On August 12, 2021, the Canadian Securities Administrators (CSA) are published for a 60-day comment period proposed changes (the Proposed Changes) National Instrument 41-101 *General Prospectus Requirements* (41-101CP) and its Companion Policy 41-101CP. The proposed changes will amend Form 41-101F1 *Information Required in a Prospectus* (Form 41-101F1) which requires an issuer that is not an investment fund to include certain financial statements in its long form prospectus. These required inclusions include the financial statements of the issuer and any business or businesses acquired, or proposed to be acquired, if a reasonable investor reading the prospectus would regard the primary business of the issuer to be the business or businesses acquired, or proposed to be acquired (collectively, the Primary Business Requirements). The Primary Business Requirements also apply to instances where securities legislation and exchange requirements refer to disclosure prepared in accordance with Form 41-101F1. The Proposed Changes provide additional explanation in 41-101CP for both IPO venture and non-venture issuers regarding: - the interpretation of primary business and predecessor entity; - clarification on when an issuer can use an optional test to calculate the significance of an acquisition; - guidance as to when and for what time periods financial statements would be required in certain circumstances; - guidance on the circumstances when additional information may be needed to meet the requirement for full, true and plain disclosure and the nature of this information; - clarification of when the acquisition of mining assets would not be considered a business. According to the Notice, the Proposed Changes seek to reduce inconsistent interpretation of requirements. The number of pre-file applications is expected to decrease significantly if the proposed changes are implemented. The comment period ends on October 11, 2021. See: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators publish final amendments to enhance protection of older and vulnerable clients](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-final-amendments-to-enhance-protection-of-older-and-vulnerable-clients/) **Published:** August 19, 2021 **Author:** Barbara Hendrickson **Excerpt:** On July 15, 2021, the Canadian Securities Administrators (CSA) published final amendments of National Instrument 31-101 Registration Requirements, Exemptions and Ongoing Registration Obligations designed to improve protection of older and vulnerable clients across Canada. According to the CSA, the amendments strengthen protection of older and... **Content:** On July 15, 2021, the Canadian Securities Administrators (CSA) published final amendments of National Instrument 31-101 Registration Requirements, Exemptions and Ongoing Registration Obligations designed to improve protection of older and vulnerable clients across Canada. According to the CSA, the amendments strengthen protection of older and vulnerable clients through two main components: - Trusted Contact Person (TCP) – registrants will be required to take reasonable steps to obtain the name and contact information of a TCP from individual clients, and written consent for the TCP to be contacted in specified circumstances (e.g. if the registrant has concerns about possible financial exploitation of a client who is vulnerable or about the client’s mental capacity to make decisions involving financial matters), A TCP does not have authority to make transactions on the account; however, is intended to be a resource to assist registrants in protecting a client’s financial interests or assets in these circumstances. While clients are not required to identify a TCP in order to open an account, registrants will be required to take reasonable steps to obtain and update TCP information as part of the Know Your Client process. - Temporary Holds – the amendments create a regulatory framework for registrants who place a temporary hold on transactions, withdrawals or transfers in circumstances where the registrant has a reasonable belief that there is financial exploitation of a vulnerable client or where there are concerns about a client’s mental capacity to make decisions involving financial matters. The CSA worked with the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA) to develop the amendments. The amendments will apply to all registered firms, including members of IIROC and the MFDA. IIROC and the MFDA plan to implement corresponding amendments to the IIROC Rules and MFDA Rules, respectively. All the amendments come into effect on December 31, 2021. Please see: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Notice and request for Comment Proposed Amendments to 45-106 Prospectus Exemptions to introduce the Listed Issuer Financing Exemption](https://baxsecuritieslaw.com/csa-notice-and-request-for-comment-proposed-amendments-to-45-106-prospectus-exemptions-to-introduce-the-listed-issuer-financing-exemption/) **Published:** August 19, 2021 **Author:** Barbara Hendrickson **Excerpt:** On July 28, 2021, the Canadian Securities Administrators (CSA) published, for comment, proposed amendments to National Instrument 45-106 Prospectus Exemptions (NI 45-106) to introduce a new prospectus exemption available to reporting issuers that are listed on a Canadian stock exchange (the Listed Issuer Financing Exemption).... **Content:** On July 28, 2021, the Canadian Securities Administrators (CSA) published, for comment, proposed amendments to National Instrument 45-106 *Prospectus Exemptions* (**NI 45-106**) to introduce a new prospectus exemption available to reporting issuers that are listed on a Canadian stock exchange (the **Listed Issuer Financing Exemption**). The CSA also published for comment proposed changes to Companion Policy 45-106CP (**45- 106CP**). The Proposed Amendments create a new capital raising method for reporting issuers listed on a Canadian stock exchange. The proposed exemption relies on the issuer’s continuous disclosure record, as supplemented with a short offering document, and would allow these issuers to distribute freely tradeable listed equity securities to the public. Issuers would generally be limited to raising the greater of $5million or 10% of the issuer’s market capitalization to a maximum total dollar amount of $10,000,000. In order to use the exemption, the issuer must have been a reporting issuer for at least 12 months. The offering document would be a “core document” under Canadian securities legislation, forming part of the issuer’s continuous disclosure record for purposes of secondary market civil liability. In the event of a misrepresentation in the offering document or in the issuer’s continuous disclosure record for a prescribed period, purchasers under the Listed Issuer Financing Exemption would have the same rights of action under secondary market civil liability as purchasers on the secondary market. In addition, purchasers under the exemption would have a contractual right of rescission against the issuer for a period of 180 days following the distribution in the event of a misrepresentation. The offering document would not be reviewed by CSA staff before use. The Listed Issuer Financing Exemption is subject to the following key conditions: - The issuer must have securities listed on a Canadian stock exchange; been a reporting issuer for 12 months in at least one jurisdiction in Canada; filed all timely and periodic disclosure documents as required under the continuous disclosure requirements in Canadian securities legislation; and active business operations. - The total dollar amount that an issuer may raise using the exemption during any 12 month period may not exceed: the greater of $5 million or 10% of the aggregate market value of the issuer’s listed equity securities, to a maximum total dollar amount of $10 million; or 100% dilution. - The issuer must prepare and file a short offering document, proposed new Form 45-106F *Listed Issuer Financing Document*, containing prescribed disclosure highlighting: any new developments in the issuer’s business, the issuer’s financial condition, including confirmation that the issuer will have sufficient funds to last 12 months after the offering, how proceeds from the current offering will be used, and how proceeds from any other offering in the previous 12 months were actually used. - The issuer must certify that the offering document, together with the continuous disclosure of the issuer for the past 12 months, contains disclosure of all material facts about the issuer or the securities being distributed and does not contain a misrepresentation. The offering document would be prescribed as a “core document” in the issuer’s continuous disclosure record, subject to statutory secondary market civil liability in the event of a misrepresentation Purchasers under the exemption would have two options for recourse in the event of a misrepresentation: A contractual right of recission against the issuer and rights of action under secondary market civil liability a contractual right of rescission against the issuer. - Exemption is not available if the issuer is planning to use the proceeds for a significant acquisition or restructuring transaction, such that the issuer would be required to provide additional financial statements under prospectus rules. - Securities must be listed equity securities or securities convertible into listed equity securities. Subscription receipts may be issued if not used in connection with a significant acquisition, restructuring transaction or other type of transaction that would require security holder approval. - Securities would not be subject to a hold period. - While investment dealers and exempt market dealers may participate, there is no requirement for an underwriter to be involved - No registration exemption. - The issuer would be required to report use of the exemption by filing a Form 45-106F1 *Report of Exempt Distribution.* The issuer would not be required to complete Schedule 1. limits on the type of investor that may participate. Not requiring purchaser information will reduce the administrative burden for the issuer. See: [https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-4/45106-CSA-Notice-and-Request-for-Comment–July-28-2021.pdf](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-4/45106-CSA-Notice-and-Request-for-Comment--July-28-2021.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Notice Of Ministerial Approval of National Instrument 45-110 Start-Up Crowdfunding Registration and Prospectus Exemptions](https://baxsecuritieslaw.com/notice-of-ministerial-approval-of-national-instrument-45-110-start-up-crowdfunding-registration-and-prospectus-exemptions/) **Published:** October 5, 2021 **Author:** Barbara Hendrickson **Excerpt:** On September 23, 2021 the Ontario Minister of Finance recently approved National Instrument 45-110 Start-Up Crowdfunding Registration and Prospectus Exemptions (NI 45-110) and consequential amendments to other instruments (the Consequential Amendments). NI 45-110 provides harmonized national registration and prospectus exemptions to facilitate securities crowdfunding for... **Content:** On September 23, 2021 the Ontario Minister of Finance recently approved National Instrument 45-110 *Start-Up Crowdfunding Registration and Prospectus Exemptions* (NI 45-110) and consequential amendments to other instruments (the Consequential Amendments). NI 45-110 provides harmonized national registration and prospectus exemptions to facilitate securities crowdfunding for start-ups and early stage issuers. The Consequential Amendments include consequential amendments to the following instruments: - National Instrument 45-102 *Resale of Securities*, - Ontario Securities Commission Rule 11-501 *Electronic Delivery of Documents to the Ontario Securities Commission*, - Ontario Securities Rule 45-501 *Ontario Prospectus and Registration Exemptions*, and - Ontario Securities Commission Rule 13-502 The Rules and other amendments came into force in Ontario on September 21, 2021. Please see: [https://www.osc.ca/sites/default/files/2021-06/csa\_20210623\_45-110\_crowdfunding-registration-prospectus-exemptions\_0.pdf](https://www.osc.ca/sites/default/files/2021-06/csa_20210623_45-110_crowdfunding-registration-prospectus-exemptions_0.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Consultation Climate-related Disclosure Update and CSA Notice and Request for Comment Proposed National Instrument 51-107 Disclosure of Climate-related Matters](https://baxsecuritieslaw.com/consultation-climate-related-disclosure-update-and-csa-notice-and-request-for-comment-proposed-national-instrument-51-107-disclosure-of-climate-related-matters/) **Published:** November 10, 2021 **Author:** Barbara Hendrickson **Excerpt:** On October 18, 2021, the Canadian Securities Administrators (CSA) published, for comment, a notice (Notice) regarding proposed National Instrument 51-107 Disclosure of Climate-related Matters (Proposed Instrument). The Proposed Instrument would introduce disclosure requirements regarding climate-related matters for reporting issuers (other than investment funds). According to... **Content:** On October 18, 2021, the Canadian Securities Administrators (CSA) published, for comment, a notice (Notice) regarding proposed National Instrument 51-107 *Disclosure of Climate-related Matters* (Proposed Instrument). The Proposed Instrument would introduce disclosure requirements regarding climate-related matters for reporting issuers (other than investment funds). According to the Notice, the Proposed Instrument: - addresses the need for more consistent and comparable information to help inform investment decisions; - improves the comparability of the information issuers disclose and helps investors make more informed investment decisions by enhancing climate-related disclosure, and - addresses costs associated with reporting across multiple disclosure frameworks, improves access to global markets, and facilitates an equal playing field for issuers. The CSA believes that the climate-related disclosure requirements contained in the Proposed Instrument would provide clarity to issuers on the information required to be disclosed and also facilitates consistency and comparability among issuers. Specifically, the climate-related disclosure requirements are intended to: - improve issuer access to global capital markets by aligning Canadian disclosure standards with expectations of international investors; - assist investors in making more informed investment decisions by enhancing climate-related disclosures; - facilitate an “equal playing field” for all issuers through comparable and consistent disclosure, and - remove the costs associated with navigating and reporting to multiple disclosure frameworks as well as reducing market fragmentation. According to the Notice, the requirements in the Proposed Instrument contemplate disclosure consistent with the recommendations from the Task Force on Climate-related Financial Disclosures (TCFD). The TCFD was established in 2015, by the international Financial Stability Board (FSB), to develop recommendations for: - more effective climate-related disclosures to promote more informed investment, credit, and insurance underwriting decisions, and - enable stakeholders to better understand the concentrations of carbon-related assets in the financial sector and the financial system’s exposures to climate-related risks. In June 2017, the TCFD released its final recommendations, which provided a framework for companies and other organizations to develop more effective climate-related financial disclosures through existing reporting practices. The TCFD organized its climate-related financial disclosures recommendations around four core elements: governance, strategy, risk management, and metrics and targets. - Governance– an issuer’s board’s oversight of and management’s role in assessing and managing climate-related risks and opportunities. - Strategy– the short-, medium- and long-term climate-related risks and opportunities the issuer has identified and the impact on its business, strategy and financial planning, where such information is material. - Risk management– how an issuer identifies, assesses and manages climate-related risks and how these processes are integrated into its overall risk management. - Metrics and targets – the metrics and targets used by an issuer to assess and manage climate-related risks and opportunities where the information is material. According to the Notice, the disclosure requirements in the Proposed Instrument will be phased-in over a one-year period for non-venture issuers and over a three-year period for venture issuers. It is not anticipated that the Proposed Instrument will come into force prior to December 31, 2022. The climate-related disclosure requirements relating to governance in the Proposed Instrument would be included in a reporting issuer’s management information circular. For issuers that do not send a management information circular to its security holders, the disclosure would be provided in the issuer’s annual information form (AIF) or its annual management’s discussion and analysis (MD&A), if the issuer does not file an AIF. The climate-related disclosures related to strategy, risk management and metrics and targets specified by the Proposed Instrument would be included in the reporting issuer’s AIF, or its annual MD&A, if the issuer does not file an AIF. The Notice also refers to the following publications issued by the CSA regarding climate-related disclosures: - CSA Staff Notice 51-333 *Environmental Reporting Guidance* (October 2010) (CSA Staff Notice 51-333) – CSA Staff Notice 51-333, issued in 2010, provided guidance to issuers on existing continuous disclosure requirements relating to environmental matters under securities legislation. - CSA Staff Notice 51-354 (April 2018) – CSA Staff Notice 51-358 reinforced and expanded on the guidance provided in 2010. The intent was to provide issuers, particularly smaller issuers, with guidance on how they might approach preparing disclosures of material climate-related risks. The notice did not create any new legal requirements or modify existing ones. - CSA Staff Notice 51-358 – CSA Staff Notice 51-358 followed the work conducted by the CSA to gather information on the state of climate change-related disclosure in Canada, which was reported in CSA Staff Notice 51-354. The work included a disclosure review, online survey, consultations and research. According to the Notice, the Proposed Instrument follows from the 2020 Ontario government appointed Capital Markets Modernization Taskforce (Modernization Taskforce). The Modernization Taskforce, which reviewed and made recommendations with respect to modernizing the capital markets regulatory framework in Ontario, recommended mandating disclosure by public companies of material ESG information, specifically climate-related disclosure that is compliant with the final TCFD recommendation for issuers through regulatory filing requirements of the OSC The CSA is publishing proposed National Instrument for a 90-day comment period that ends on January 17, 2022. Please see: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Government Proposes New Capital Markets Act](https://baxsecuritieslaw.com/ontario-government-proposes-new-capital-markets-act/) **Published:** November 10, 2021 **Author:** Barbara Hendrickson **Excerpt:** On October 12, 2021, the Ontario government, as part of its Capital Markets Modernization Review, published a draft Capital Markets Act (CMA) and a Capital Markets Act Consultation Commentary (CMA Consultation Commentary). According to the CMA Consultation Commentary, the CMA sets out the regulatory framework... **Content:** On October 12, 2021, the Ontario government, as part of its Capital Markets Modernization Review, published a draft *Capital Markets Act* (CMA) and a Capital Markets Act Consultation Commentary (CMA Consultation Commentary). According to the CMA Consultation Commentary, the CMA sets out the regulatory framework for capital markets participants, outlines the Ontario Securities Commission’s (OSC) regulatory and enforcement powers, including the authority to make rules, and provides for the Capital Markets Tribunal’s (Tribunal) adjudicative powers. The CMA draft follows on the publication of a draft *Securities Commission Act, 2021* (SCA) that was published in March of 2021. The CMA and the SCA would replace the *Securities Act* and the *Commodity Futures Act* (*CFA*) in Ontario. The SCA outlines the governance and accountability of the OSC, including the board of directors, Chief Executive Officer and Tribunal. The *SCA* implemented the following OSC governance changes recommended by the Taskforce: - Separate the regulatory and adjudicative functions at the OSC; and - Separate the current Chair and Chief Executive Officer position into two distinct positions Modernizing Ontario’s capital markets through the introduction of the CMA and the SCA was a recommendation of the final report of the Capital Markets Modernization Taskforce (Taskforce), released in January 2021. An earlier version of the CMA was developed as part of the Cooperative Capital Markets Regulatory System (CCMR) initiative as an attempt to create a Canadian national securities regulatory regime. The following is a brief outline of the several of the key differences between the CMA and the *Securities Act* and the *Commodity Futures Act* (*CFA*). 1. Platform Approach: A significant difference is the extent to which the CMA adopts a platform approach to capital markets regulation, in that the CMA is designed to set out the fundamental provisions of capital markets law while leaving detailed requirements to be addressed in the rules. This approach was developed in the context of the CCMR initiative and has been continued in the CMA. 2. Decision Making: Under the CMA, regulatory decision-making and decisions of the “Director” and “Executive Director” under the *Securities Act* have been assigned to the Chief Regulator. 3. Order Making: Under the *Securities Act*, the OSC’s Board of Directors is responsible for recognition and designation orders and certain cease trade orders. Under the CMA, the Chief Regulator has been assigned responsibility for recognition and designation orders under the CMA and will have authority to make cease trade orders in extraordinary circumstances, subject to confirmation by the OSC’s Board of Directors. 4. *Commodity Futures Act*: In Ontario, commodity futures contracts and commodity futures options are regulated under the *CFA*. It is proposed that, if the CMA is enacted, the *CFA* would be repealed, and commodity futures contracts and commodity futures options currently regulated under the *CFA* would be regulated as derivatives under the CMA. The registration exemptions under the *CFA* that apply to commodity futures contracts and commodity futures options would no longer be available. The “trade trigger” for registration under the *CFA* would be replaced with the CMA’s “business trigger”. Therefore, market participants who previously relied on exemptions under the *CFA* for trading in exchange contracts would be subject to the dealer registration requirement under the CMA only if they are in the business of trading. Furthermore, market participants currently relying on *CFA* exemptions may be able to rely on registration exemptions in NI 31-103 that apply to exchange contracts. 5. Registration Requirements: Unlike in the *Securities Act*, the CMA allows the OSC to make a rule imposing registration requirements on over-the-counter (OTC) derivatives dealers and derivatives advisers not otherwise subject to registration exemptions in the CMA. 6. Rule Making: The CMA provides for approach to rule-making contrasts to the more prescriptive approach currently used in the *Securities Act*, which contains an itemized list of each and every head of rule-making that requires amendment whenever it is necessary to make a rule not covered in the list. manner. Instead of the detailed list of heads of rule-making authority, substantive provisions would be included throughout the CMA. These additional substantive provisions would support the general rule-making authority contained in the legislation. ## Taskforce Recommendations Included in the *Capital Markets Act* According to the Consultation Document, the Government of Ontario is utilizing the CMA as a legislative vehicle to implement a number of Taskforce recommendations, several of which are described below. The CMA includes a provision requiring a periodic review every five years of the capital markets legislation and OSC rules. 1\. The CMA allows the Chief Regulator to make compliance orders to address specific situations where an issuer is non-compliant with requirements. The compliance order power could be delegated to the staff of the OSC’s Corporate Finance Branch. 2\. The CMA includes the rule-making authority to allow for the automatic issuance of prospectus receipts for issuers that meet certain requirements (well-known seasoned issuer model) including that the issuers have a certain public float or have issued debt securities above a set amount in a specified time period and have established an appropriate disclosure record. 3\. The CMA includes broader civil liability recourse for investors in the exempt market by expanding the rights of action for misrepresentations in an offering memorandum to the issuer, as well as directors and promoters of the issuer. 4\. The CMA would provide the OSC with designation powers and rule-making authority for crypto assets that are not already securities or derivatives would allow the OSC to tailor requirements to new platforms and assets. 5\. The CMA would require all publicly listed issuers to have an annual advisory shareholders’ vote on the board’s approach to executive compensation. 6\. The CMA includes the rule-making authority to allow for requirements to be placed on independent directors of issuers in the context of material conflict of interest transactions Including mandating the formation of independent committees to oversee material conflict of interest transactions. Transactions include insider bids, business combinations in which insiders are eliminating public shareholders, and significant related-party transactions with the issuer that could result in the transfer of value from minority shareholders to insiders. 7\. The CMA includes new Tribunal order powers related to M&A matters that may be exercised by the Tribunal upon an application by an interested person. Providing the Tribunal with these powers would provide market participants with an alternative to initiating a court proceeding for these remedies. 8\. The CMA provides that the OSC may prescribe requirements and restrictions for persons engaging in promotional activities, which are defined to include communications that encourage or reasonably could be expected to encourage purchasing and trading securities and derivatives. It also specifically prohibits false or misleading statements about public companies in connection with promotional activity and attempts to make such statements. 9\. The CMA increases the maximum administrative monetary penalties that can be imposed by the Tribunal and the maximum fine for offences that can be imposed by the court. 10\. The Provincial Offences Act search warrant power only provides a power to search for “things” such as paper records and objects.. 11\. The CMA modernizes quasi-criminal investigations by allowing the OSC to apply to a judge or justice of the provincial court (justice) to obtain a production order. Production orders would require firms and individuals that are not under investigation, and who have possession or control of the relevant information or data, to gather or prepare the applicable documents, records, or electronic data to deliver to an investigator. A production order may require the record holder to gather or prepare the records, even if they are in off-site paper or stored electronically, and provide them to an investigator, within a certain period of time specified by the justice. 12\. The CMA includes changes that modernize the OSC’s enforcement powers including removing the personal service requirement and giving the OSC the rule-making authority to set the service requirements that would include electronic service. They also include a new power for the OSC to obtain a warrant to search a dwelling-house during daylight hours. 13\. The CMA allows an authorized investigator to compel a summons recipient to preserve evidence for the purpose of an investigation. This power allows the OSC to enforce non-compliance with a request or demand to preserve evidence and help to ensure that evidence is not destroyed or altered in response to an OSC summons. This power would increase the effectiveness of OSC investigations and aligns with similar investigation tools in other provinces. 14\. The CMA includes a provision that allows the OSC and respondents to mutually agree to extend the limitation period to commence proceedings. 15\. Similar to section 154 of the Securities Act, the CMA includes a provision that clarifies that there is no contractual liability for disclosures to the OSC of information to comply with capital markets law. As such, if a person provides information to the OSC pursuant to a summons, this provision clarifies that this person is not subject to contractual liability for complying with the summons. 16\. The CMA prohibits aiding, abetting or counselling a contravention of capital markets law and conspiring with any other person to contravene capital markets law. These prohibitions would allow the OSC to take enforcement action against those who facilitate or assist in contravening capital markets law and provide the OSC with additional tools to enforce capital markets law and improve investor protection. Other CSA jurisdictions have similar prohibitions in their securities acts. 17\. The CMA includes a prohibition against front-running: acting on knowledge of an order of a client or connected investor that would disadvantage the client or connected investor. The relevant defences, partially based on IIROC’s Universal Market Integrity Rules, are also included and additional criteria for the defences may be prescribed in the rules. 18\. The CMA does not include a provision equivalent to section 16 of the Securities Act requiring confidentiality of any information obtained pursuant to a summons, including information about the OSC’s investigations. Instead of a broad prohibition against disclosing any information related to a summons, the CMA takes a different approach and provides that the Chief Regulator may make orders with respect to the confidentiality of investigations. This approach gives flexibility to the OSC when imposing confidentiality obligations with respect to investigations. 19\. The CMA includes a provision that reflects that the OSC may not require production of privileged documents. Under common law, respondents always have the right to not produce privileged documents, and the Supreme Court of Canada has made this a quasi-constitutional right. 20\. The CMA includes provisions allowing the Tribunal to make disgorgement orders and allowing the Chief Regulator to apply to the court to appoint one or more persons to administer and distribute the disgorged amounts received by the OSC. 21\. The CMA includes automatic and streamlined reciprocation provisions similar to provisions that have already been enacted in most CSA jurisdictions other than Ontario. 22\. The CMA includes a statutory protection against the OSC disclosing information that would identify a whistle-blower. Currently, the OSC would rely on the disclosure exemptions in the Freedom of Information and Protection of Privacy Act (FIPPA) to withhold this information. The CMA Consultation Commentary cautions that the draft CMA is only intended for stakeholder consultation purposes at this stage, and comments received during the consultation will be considered prior to determining next steps. Please see: [https://www.ontariocanada.com/registry/view.do?postingId=38527&language=en](https://www.ontariocanada.com/registry/view.do?postingId=38527&language=en) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [IOSCO Sustainable Finance Task Force publishes final report on sustainability-related practices, policies, procedures and disclosure in asset management](https://baxsecuritieslaw.com/iosco-sustainable-finance-task-force-publishes-final-report-on-sustainability-related-practices-policies-procedures-and-disclosure-in-asset-management/) **Published:** November 10, 2021 **Author:** Barbara Hendrickson **Excerpt:** On November 4, 2021, the Ontario Securities Commission issued a press release referencing the Recommendations on Sustainability-Related Practices, Policies, Procedures and Disclosure in Asset Management (the Final Report) published by the Sustainable Finance Task Force (STF) of the International Organization of Securities Commissions (IOSCO) on... **Content:** On November 4, 2021, the Ontario Securities Commission issued a press release referencing the Recommendations on Sustainability-Related Practices, Policies, Procedures and Disclosure in Asset Management (the Final Report) published by the Sustainable Finance Task Force (STF) of the International Organization of Securities Commissions (IOSCO) on November 2, 2021. The Final Report sets out recommendations for securities regulators and policymakers, as applicable, that aim to improve sustainability-related practices, policies, procedures and disclosure in asset management. The Ontario Securities Commission (OSC) was a co-lead of the STF workstream that produced the Final Report, which follows the consultation report that was published on June 30, 2021. **The Final Report:** The Final Report sets out recommendations for securities regulators and policymakers, as applicable, that aim to improve sustainability-related practices, policies, procedures and disclosure in asset management: **Asset Manager Practices, Policies, Procedures and Disclosure:** Securities regulators and/or policymakers, as applicable, should consider setting regulatory and supervisory expectations for asset managers in respect of the: (a) development and implementation of practices, policies and procedures relating to material sustainability-related risks and opportunities; and (b) related disclosure. **Product Disclosure:** Securities regulators and/or policymakers, as applicable, should consider clarifying and/or expanding on existing regulatory requirements or guidance or, if necessary, creating new regulatory requirements or guidance, to improve product-level disclosure in order to help investors better understand: (a) sustainability-related products; and (b) material sustainability-related risks for all products. **Supervision and Enforcement:** Securities regulators and/or policymakers, as applicable, should have supervisory tools to monitor and assess whether asset managers and sustainability-related products are in compliance with regulatory requirements and enforcement tools to address any breaches of such requirements. **Terminology:** Securities regulators and/or policymakers, as applicable, should consider encouraging industry participants to develop common sustainable finance related terms and definitions, including relating to ESG approaches, to ensure consistency throughout the global asset management industry. **Financial and Investor Education:** Securities regulators and/or policymakers, as applicable, should consider promoting financial and investor education initiatives relating to sustainability, or, where applicable, enhance existing sustainability related initiatives. Please see: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Real Estate Syndication - the use of REITs and Limited Partnerships November 17, 2021](https://baxsecuritieslaw.com/real-estate-syndication-the-use-of-reits-and-limited-partnerships-october-1-2018-2/) **Published:** November 17, 2021 **Author:** Barbara Hendrickson **Excerpt:** In recent years the use of REITs and Limited Partnerships have expanded in the last few years and investments in real estate through these types of structure have become a common way for investors to participate in real estate projects. The attached presentation provide a... **Content:** In recent years the use of REITs and Limited Partnerships have expanded in the last few years and investments in real estate through these types of structure have become a common way for investors to participate in real estate projects. The attached presentation provide a overview of these investment structures. ## [**Click here for full PDF presentation**](https://lawfirmbarbara.wpengine.com/wp-content/uploads/2018/10/Real-Estate-Syndication-2021-updated.pdf) **Categories:** News & Updates --- ### [TSXV publishes changes to Security Based Compensation](https://baxsecuritieslaw.com/tsxv-publishes-changes-to-security-based-compensation/) **Published:** December 13, 2021 **Author:** Barbara Hendrickson **Excerpt:** On November 24, 2021, the TSX Venture Exchange (the TSXV) announced changes to the TSXV’s Corporate Finance Manual regarding Security Based Compensation. The following amendments have been made: Policy 4.4 – Incentive Stock Options has been amended and renamed Policy 4.4 – Security Based Compensation... **Content:** On November 24, 2021, the TSX Venture Exchange (the TSXV) announced changes to the TSXV’s Corporate Finance Manual regarding Security Based Compensation. The following amendments have been made: - Policy 4.4 – *Incentive Stock Options* has been amended and renamed Policy 4.4 – *Security Based Compensation* (the New Policy); - Policy 4.7 – *Charitable Options in Connection with an IPO* (Policy 4.7) has been repealed as the Security Based Compensation Policy includes the substantive contents of Policy 4.7; - Form 4G – *Summary Form – Incentive Stock Options* has been amended and renamed Form 4G *– Summary Form – Security Based Compensation* (New Form 4G); and - Form 4F – *Certification and Undertaking Required from a Company Granted an Incentive Stock Option* (Form 4F) has been repealed as the New Form 4G includes the substantive contents of Form 4F. The New Policy and the New Form 4G, and the repeal of Policy 4.7 and Form 4F, are effective November 24, 2021. Security Based Compensation Plans currently in effect will remain in full force and effect, and may be amended in accordance with the New Policy with the requisite Shareholder approval. Any outstanding Security Based Compensation Plan that does not comply with the New Policy will need to be amended to comply with the New Policy the next time it is placed before the Issuer’s Shareholders for approval. The following highlights some but not all of the amendments: **1. Types of Security Compensation** 1. – In addition to stock options (Stock Options) the New Policy covers a variety of types of Security Based Compensation, such as deferred share units (DSU), performance share units (PSU), restricted share units (RSU) and stock appreciation rights (SAR). **2. Categories of Security Based Compensation Plans** – The New Policy permits four categories of Plans: **a. “rolling up to 10%** – a maximum of 10% of the Issued Shares of the Issuer; **b. “fixed up to 20%”** – a fixed specified number of Listed Shares of the Issuer up to a maximum of 20% of the Issued Shares of the Issuer; **c. “rolling up to 10% and fixed up to 10%”** – a maximum of 10% of the Issued Shares of the Issuer as at the date of any Stock Option grant, and “fixed” Security Based Compensation Plan(s) (other than Stock Option Plans) under which the number of Listed Shares of the Issuer that are issuable pursuant to all such Security Based Compensation Plan(s) (other than Stock Option Plans) in aggregate is a fixed specified number of Listed Shares of the Issuer up to a maximum of 10% of the Issued Shares of the Issuer; or **d. “fixed Stock Option Plan up to 10%”** – a “fixed” Stock Option Plan under which the number of Listed Shares of the Issuer that are issuable pursuant to the exercise of Stock Options is a fixed specified number of Listed Shares of the Issuer up to a maximum of 10% of the Issued Shares of the Issuer. **3. Shareholder Approval** – The Security Based Compensation Policy clarifies the specific Shareholder approval required for each category of Security Based Compensation Plan: **a. “fixed Stock Option Plan up to 10%”** – the only circumstance in which Shareholder approval of a Security Based Compensation Plan is not required is in relation to the implementation of a “fixed” Stock Option Plan; **b. “fixed up to 20%”** – must receive Shareholder approval at the time the “fixed” Security Based Compensation Plan is implemented. **c. “rolling up to 10%”** – must receive Shareholder approval at the time the “rolling” Security Based Compensation Plan is implemented and yearly thereafter, at the Issuer’s annual meeting of Shareholders. **d. “rolling up to 10% and fixed up to 10%” –** must obtain yearly approval of the “rolling” Stock Option Plan and must also obtain Shareholder approval of the “fixed” Security Based Compensation Plan(s). If the Issuer has elected to implement one Security Based Compensation Plan that includes both the “rolling” Stock Option Plan and “fixed” Security Based Compensation Plan(s), then the Issuer must obtain yearly approval of that Security Based Compensation Plan. **4. Cashless Exercise / Net Exercise** – the New Policy permits Stock Options to be exercised using “Net Exercise” and “Cashless Exercise”. **5. Security Based Compensation Outside of a Security Based Compensation Plan – i**n certain circumstances, the TSXV will consider an application of an issuer to grant Security Based Compensation outside of a Security Based Compensation Plan and generally such a grant will be subject to disinterested shareholder approval, which may be obtained at a meeting or by written consents. **a) Securities for Services** – Policy 4.3 – *Shares for Debt* (Policy 4.3), sets out a number of requirements for an agreement to compensate a Person by way of Securities for Services. These requirements are now included in the New Policy. **b) Compensation Owed to Non-Arm’s Length Parties –** the TSXV is increasing the limit for Shares for Debt to $5,000 per month per Person and $10,000 per month in aggregate per Issuer, and has included this type of compensation in the Security Based Compensation Policy **c) One Time Payments as Inducement or Severance –** issuers may issue Listed Shares as an inducement or as severance without Shareholder approval subject to certain limitations set out in the New Policy. **d) Loans –** where an Issuer wishes to lend funds for the purposes of acquiring shares of the issuer, the loans must be approved by disinterested shareholders. Please see: **Categories:** News & Updates --- ### [Canadian securities regulators introduce exemptions for qualified issuers from certain base shelf prospectus requirements](https://baxsecuritieslaw.com/canadian-securities-regulators-introduce-exemptions-for-qualified-issuers-from-certain-base-shelf-prospectus-requirements/) **Published:** December 14, 2021 **Author:** Barbara Hendrickson **Excerpt:** On December 6, 2021, the Canadian Securities Administrators (CSA) published a notice regarding temporary exemptions from certain base shelf prospectus requirements for qualifying well-known seasoned issuers (WKSI). The exemptions allow an issuer that meets WKSI qualifications and certain conditions, to file a final base shelf... **Content:** On December 6, 2021, the Canadian Securities Administrators (CSA) published a notice regarding temporary exemptions from certain base shelf prospectus requirements for qualifying well-known seasoned issuers (WKSI). The exemptions allow an issuer that meets WKSI qualifications and certain conditions, to file a final base shelf prospectus with its principal regulator and obtain a receipt for that prospectus on an accelerated basis without first filing a preliminary base shelf prospectus. The CSA has implemented the relief through local blanket orders (Blanket Orders). In Ontario, the Blanket Order is Ontario Instrument 44-501 *Exemption from Certain Prospectus Requirements for Well-known Seasoned Issuers* (OSC 44-501). The changes follow the recommendations of the Ontario Capital Markets Modernization Taskforce (the Taskforce) that the OSC develop a WKSI model to streamline the prospectus process for issuers that meet certain eligibility criteria, similar to the US regime for well-known seasoned issuers set out in *The Securities Act* *of 1933*. The Blanket Orders exempt an issuer that meets the WKSI qualifications and certain conditions from the requirements: 1\. to file and obtain a receipt for a preliminary base shelf prospectus; 2\. to limit distributions under the base shelf prospectus to the dollar value the issuer reasonably expects to distribute within 25 months after the date of the receipt for the base shelf prospectus; 3\. to state the aggregate dollar amount of securities that may be raised under the base shelf prospectus; 4\. to include the number of securities qualified for distribution under the base shelf prospectus; 5\. to include a plan of distribution in the base shelf prospectus, other than to indicate that the plan of distribution will be described in the supplement for any distribution of securities; 6\. to describe the securities being distributed, other than as necessary to identify the types of securities qualified for distribution under the base shelf prospectus; and 7\. to describe any selling security holders in the base shelf prospectus. Under OSC 44-501, a “WKSI” is an issuer that has either of the following: a) outstanding listed equity securities that have a public float of C$500,000,000; or b) at least C$1,000,000,000 aggregate amount of non-convertible securities, other than equity securities, distributed under a prospectus in primary offerings for cash, not exchange, in the last three years. A WSKI issuer is exempt from the requirement to file and obtain a receipt for a preliminary prospectus in connection with the filing of a base shelf prospectus provided that, at the time the issuer files the base shelf prospectus; the issuer is not an investment fund; has no outstanding asset backed securities; and it satisfies a number of conditions including but not limited to the following: a) the issuer meets the definition of a WKSI as of a date within 60 days preceding the date the issuer files the base shelf prospectus; b) the issuer is and has been a reporting issuer in at least one jurisdiction of Canada for 12 months; and c) the issuer is not an ineligible issuer. The definition of “ineligible issuer” in OSC 44-501 includes the following issuers: a) an issuer who has not filed with the securities regulator or securities regulatory authority in each jurisdiction in which it is a reporting issuer all periodic and timely disclosure documents that it is required to have filed in that jurisdiction; b) the issuer is or, during the past three years, the issuer or any of its predecessors was, either of the following: I. an issuer whose operations have ceased; or II. an issuer whose principal asset is cash, cash equivalents, or its exchange listing, including, without limitation, a capital pool company, a special purpose acquisition company, or a growth acquisition corporation or any similar entity, as defined in the applicable stock exchange rules or policies; c) the issuer has, in the past three years, become bankrupt; made a proposal under any legislation relating to bankruptcy or insolvency; or was subject to or instituted any proceedings, arrangement or compromise with creditors; or had a receiver, receiver manager or trustee appointed to hold its assets; d) the issuer or any entity that, at the time, was a subsidiary of the issuer; or was the subject of any penalties or sanctions, including restrictions on the use by the issuer of any type of prospectus, or exemption, imposed by a court relating to securities legislation or by a securities regulatory authority within the past three years; and e) the issuer has been the subject of any cease trade order in any Canadian jurisdiction or any suspension of trading under section 12(k) of the Securities Act of 1933 within the three years; According to the CSA Notice “in the ordinary course”, for a final base shelf prospectus filed with the principal regulator before noon, local time, and in compliance with the requirements of NI 44-102 and the Blanket Orders, the accelerated procedures will permit the receipt to be issued on the same business day. If a final base shelf prospectus is filed with the principal regulator after noon, local time, and in compliance with the requirements of NI 44-102 and the Blanket Orders, the accelerated procedures will permit the receipt to be issued before noon on the next business day. Please see: [https://www.osc.ca/sites/default/files/2021-12/20211206\_44-501\_interim-class-order-wksi-prospectus-exemptions.pdf](https://www.osc.ca/sites/default/files/2021-12/20211206_44-501_interim-class-order-wksi-prospectus-exemptions.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Included in Short List for Top Canadian Corporate Boutique Law Firm](https://baxsecuritieslaw.com/bax-included-in-short-list-for-top-canadian-corporate-boutique-law-firm/) **Published:** January 5, 2022 **Author:** Barbara Hendrickson **Excerpt:** Dear Friends and Colleagues, BAX Securities Law, a firm that I founded in 2013, has been included by the Canadian Lawyer on a shortlist of top Canadian boutique law firms that practise in the corporate law area.  I am honoured that BAX Securities Law received... **Content:** Dear Friends and Colleagues, BAX Securities Law, a firm that I founded in 2013, has been included by the Canadian Lawyer on a shortlist of top Canadian boutique law firms that practise in the corporate law area. I am honoured that BAX Securities Law received the recognition of being one of the top ten Canadian corporate securities boutiques in 2016 – 2017, 2018 – 2019, and 2020 – 2021. With your support, we received this recognition in the past and we are asking for your support again this year. Please take a few minutes out of your busy day to complete the attached online survey and include BAX in your selection of notable corporate securities law firms. The survey is only open to members of the legal community and can be accessed online until January 28, 2022. Thank you for your vote. Stay safe! Yours very truly, **Barbara Hendrickson** [www.baxsecuritieslaw.com](http://www.baxsecuritieslaw.com) ## [**The survey can be accessed below:**](https://www.surveymonkey.com/r/893N7LM?utm_campaign=CL_survey&utm_medium=email&_hsmi=199825992&_hsenc=p2ANqtz-9PdYYhgSQpvtjcGTnQXc2R0PJRu9OwmVHi5G8J3bTQMcSB0UQ1rKaGAB1hpTly5qa-ScUjE7637gwRNBp1t3Fj99QwMkbEft77BPVeWqHwPlN0tks&utm_content=199825992&utm_source=hs_email) # [**SURVEY**](https://www.surveymonkey.com/r/893N7LM?utm_campaign=CL_survey&utm_medium=email&_hsmi=199825992&_hsenc=p2ANqtz-9PdYYhgSQpvtjcGTnQXc2R0PJRu9OwmVHi5G8J3bTQMcSB0UQ1rKaGAB1hpTly5qa-ScUjE7637gwRNBp1t3Fj99QwMkbEft77BPVeWqHwPlN0tks&utm_content=199825992&utm_source=hs_email) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Publishes Amendments to National Instrument 52-108 Auditor Oversight and Changes to Companion Policy 52-108 Auditor Oversight](https://baxsecuritieslaw.com/csa-publishes-amendments-to-national-instrument-52-108-auditor-oversight-and-changes-to-companion-policy-52-108-auditor-oversight/) **Published:** January 27, 2022 **Author:** Barbara Hendrickson **Excerpt:** In early January 2022, the Canadian Securities Administrators (CSA) published the Amendments to National Instrument 52-108 Auditor Oversight (Amendments) and Changes to Companion Policy 52-108 Auditor Oversight (CP Changes), (collectively, the Revisions). The Amendments require actions by reporting issuers and participating audit firms that will... **Content:** In early January 2022, the Canadian Securities Administrators (CSA) published the Amendments to National Instrument 52-108 *Auditor Oversight* (Amendments) and Changes to Companion Policy 52-108 *Auditor Oversight* (CP Changes), (collectively, the Revisions). The Amendments require actions by reporting issuers and participating audit firms that will assist the Canadian Public Accountability Board (CPAB) in accessing audit working papers of component auditors, particularly in certain foreign jurisdictions. The CP Changes provide guidance on how to interpret and apply the Amendments. In connection with the Revisions, CPAB has also published guidance on their website to provide additional insight to auditors on the processes they will employ to operationalize the Amendments. Provided all necessary ministerial approvals are obtained, the Amendments will come into force on March 30, 2022. **Substance and purpose** The Revisions are a response to challenges CPAB has had in accessing audit work performed by an audit firm in a foreign jurisdiction that forms part of the audit evidence supporting an auditor’s report issued by a participating audit firm (PAF). An audit firm performing such audit work is commonly referred to as a ‘component auditor’. The Amendments require a reporting issuer to give notice in writing to a component auditor that meets the significance thresholds, a significant component auditor (SCA), that the reporting issuer permits the significant component auditor to provide CPAB with access to its audit work relating to the audit of the reporting issuer’s financial statements if that access is requested by the CPAB. The Amendments also require a reporting issuer to give notice in writing to a significant component auditor that the reporting issuer permits the SCA to enter into an agreement with CPAB governing access to the audit work the SCA has performed in relation to a component of the reporting issuer (a CPAB access agreement) if the component auditor does not voluntarily provide access to the CPAB upon request. If, despite a reporting issuer’s permission and CPAB’s request, the component auditor does not enter into a CPAB access agreement, a PAF is, after a prescribed period of time for transition, not permitted to use the audit firm as a SCA. **Background** A reporting issuer may have operations in a foreign jurisdiction that differs from its head office jurisdiction. This may present challenges for the reporting issuer’s auditor due to different languages, laws and business practices in the foreign jurisdiction. In responding to those challenges, a PAF may ask a component auditor to perform work that forms part of the audit evidence supporting the PAF’s auditor’s report. A component auditor could be a member of the PAF’s international network, or an unrelated foreign or domestic audit firm. If a PAF decides to use the work of a component auditor, the PAF must comply with Canadian Auditing Standard 600 *Special Considerations – Audits of Group Financial Statements (Including the Work of Component Auditors)* (CAS 600), which specifies that the PAF is responsible for the direction, supervision and performance of the overall audit. Although CAS 600 requires the PAF to document the type of work performed by a component auditor and the PAF’s review of such work, there is no requirement for the PAF to retain in its files a copy of the work performed by the component auditor. In order to assess whether sufficient audit evidence has been obtained to support the PAF’s audit opinion, CPAB has determined that it needs access to a substantial portion of the audit work performed. However, CPAB has encountered some instances where a substantial portion of the audit work has been performed by a component auditor in a foreign jurisdiction, and CPAB was not allowed access to such audit work. **Summary of the Revisions** The Revisions: - introduce the definition of a significant component auditor, namely a component auditor that performs audit work involving financial information related to a component, whose activities the reporting issuer has the power to direct on its own or jointly with another person or company, and, - meets one of the quantitative metrics relating to hours of work, fees paid, or relative size of the component’s assets or revenue; - require a reporting issuer to give notice in writing to a significant component auditor that the reporting issuer permits the significant component auditor to provide CPAB with access to records relating to the component auditor’s audit work performed for a reporting issuer audit; - require a reporting issuer to give notice in writing to a SCA involved in the audit of its financial statements that the reporting issuer permits the SCA to enter into a CPAB access agreement if the reporting issuer receives a copy of a notice from its PAF stating that a SCA has failed to provide CPAB access to the SCA’s records related to audit work performed. A CPAB access agreement is a written agreement between CPAB and a SCA governing access by CPAB to the SCA’s records related to audit work it has performed in relation to a component of a reporting issuer. The terms and conditions set out in a CPAB access agreement, including the manner and conditions for when access is to be provided, must be agreed to by CPAB and the SCA; - require a PAF to no longer use a public accounting firm as a SCA after a prescribed period of time, if the PAF receives notice that the public accounting firm has failed to enter into a CPAB access agreement after being requested to do so. A PAF may use SCA that undertakes in writing to provide CPAB access to its audit work or has entered into a CPAB Access Agreement in respect of the reporting issuer. **Summary of changes compared to the original proposals** The Revisions are substantially similar to the original proposals, except for the following: - The quantitative metrics for the SCA definition have been revised. The numerator in some calculations now refers to the total audit hours or fees pertaining to the audit of the financial statements instead of the total audit hours or fees pertaining to the PAF. - The Amendments require a reporting issuer to permit the SCA to provide CPAB access to their work and, if requested by CPAB, to enter into a CPAB access agreement. These changes are intended to prevent the reporting issuer from delaying or impeding CPAB’s access to the audit work, and replace the previously proposed requirement for the reporting issuer to take reasonable steps to direct the SCA to provide access or enter into a CPAB access agreement. The Revisions to National Instrument 52-108 Auditor Oversight and Companion Policy 52-108 Auditor Oversight can be found on CSA [members’ websites.](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/5-ongoing-requirements-for-issuers-insiders/current/52-108/52108-csa-notice-of-publication-january-13-2022) 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. **Categories:** News & Updates --- ### [CSA Publishes Amendments to National Instrument 33-109 Registration Information, and National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations](https://baxsecuritieslaw.com/csa-publishes-amendments-to-national-instrument-33-109-registration-information-and-national-instrument-31-103-registration-requirements-exemptions-and-ongoing-registrant-obligations/) **Published:** January 27, 2022 **Author:** Barbara Hendrickson **Excerpt:** In late December 2021, the Canadian Securities Administrators (CSA) published the final amendments to National Instrument 33-109 Registration Information (NI-33-109), its related Companion Policy CP 33-109 (CP 33-109) and National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI-3103) and the related Companion Policy CP-103 (CP-103)... **Content:** In late December 2021, the Canadian Securities Administrators (CSA) published the final amendments to National Instrument 33-109 *Registration Information* (NI-33-109), its related Companion Policy CP 33-109 (CP 33-109) and National Instrument 31-103 *Registration Requirements, Exemptions and Ongoing Registrant Obligations* (NI-3103) and the related Companion Policy CP-103 (CP-103) (the Amendments). The goal of the Amendments is to establish a more efficient registration and oversight process for firms, individuals and regulators by simplifying and streamlining certain regulatory requirements. The changes also provide firms and individuals with greater clarity on the information required as part of the registration process, while improving the quality of information received by regulators. The Amendments are not intended to change the nature of the registration process, the requirement to register, or the assessment of suitability for registration. Provided all ministerial approvals are obtained, the Amendments will come into force on June 6, 2022. The CSA will not require registrants to update their registration information as of the effective date of the Amendments. Instead, registrants will be required to update their information by the earlier of (i) when the registrant next has a change in registration information to report on or after the June 6, 2022 effective date or (ii) June 6, 2023. [The final amendments include guidance relating to updating registration information](https://www.securities-administrators.ca/resources/access-rules-policies/). Highlights include: - Establishing a new framework for reporting outside activities to regulators - Codifying existing requirements regarding outside activities that are positions of influence - Extending some deadlines to report changes in registration information - Implementing a new rule to reduce multiple filings of the same information - Amending certain registration requirements to reduce common errors - Clarifying the language on certain forms - Updating and improving the privacy notice to provide greater clarity on how personal information is collected and used by the CSA and SROs - Implementing a new requirement to report the business titles and professional designations used by registered firms and individuals The amendments to National Instrument 33-109 *Registration Information*, and related changes to its companion policy, as well as consequential amendments to National Instrument 31-103 *Registration Requirements, Exemptions and Ongoing Registrant Obligations* and changes to its companion policy can be found on CSA [members’ websites.](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/3-registration-requirements-related-matters/current/33-109/33-109-csa-staff-notice-december-16-2021) 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. **Categories:** News & Updates --- ### [CSA Seeks Comments on the Proposed Modernization of the Prospectus Filings Models for Investment Funds](https://baxsecuritieslaw.com/csa-seeks-comments-on-the-proposed-modernization-of-the-prospectus-filings-models-for-investment-funds/) **Published:** January 31, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published for comment a two-staged proposal to modernize the prospectus filing model for investment funds. In keeping with current requirements, investor access to continuous disclosure documents as well as delivery of the Fund Facts and the ETF Facts –... **Content:** The Canadian Securities Administrators (CSA) has published for comment a two-staged proposal to modernize the prospectus filing model for investment funds. In keeping with current requirements, investor access to continuous disclosure documents as well as delivery of the Fund Facts and the ETF Facts – which are renewed annually and provide key information in a simple, accessible and comparable format – remain unchanged. Investors will still be able to request the prospectus or access it online. Of the two stages, the first consists of proposed amendments that would allow investment funds in continuous distribution to file a new prospectus every two years instead of on an annual basis, as they currently do. The requirement to file a final prospectus no more than 90 days after the issuance of a receipt for a preliminary prospectus for all investment funds would also be repealed. As part of the second stage, the CSA is seeking stakeholder comments on a consultation paper introducing a new shelf prospectus filing model that could apply to all investment funds in continuous distribution. The conceptual framework for this model is based on an adaptation of the current shelf prospectus system. Proposed amendments to National Instrument 41-101 *General Prospectus Requirements* and National Instrument 81-101 *Mutual Fund Prospectus Disclosure,* and proposed changes to Companion Policy 41-101 *General Prospectus Requirements* and Companion Policy 81-101 *Mutual Fund Prospectus Disclosure* have been published for a 90-day comment period and are available on CSA member [websites](https://www.securities-administrators.ca/resources/access-rules-policies/). 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. **Categories:** News & Updates --- ### [CSA Warns Regarding Fraudulent Investment Solicitations Involving Crypto Assets](https://baxsecuritieslaw.com/csa-warns-regarding-fraudulent-investment-solicitations-involving-crypto-assets/) **Published:** February 2, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) is warning the public about investment schemes involving fraudulent websites that solicit investments in foreign exchange (“forex”), binary options and/or crypto assets. In particular, fraudsters continue to capitalize on market interest in crypto assets to lure investors into scams, using... **Content:** The Canadian Securities Administrators (CSA) is warning the public about investment schemes involving fraudulent websites that solicit investments in foreign exchange (“forex”), binary options and/or crypto assets. In particular, fraudsters continue to capitalize on market interest in crypto assets to lure investors into scams, using high-pressure sales tactics and promises of high returns with little or no risk. Investors have reported being directed to a crypto asset trading platform to convert their funds to crypto assets. Once purchased, investors are then encouraged to transfer the crypto assets to a fraudulent, third-party investment website to fund an “account”. In some cases, they are instructed by the fraudsters to download software that enables remote access to their computer for supposed assistance purchasing crypto assets and transferring funds. The CSA and the Investment Industry Regulatory Organization of Canada (IIROC) have also [noted](https://www.securities-administrators.ca/news/csa-investor-alert-investment-scams-imitating-well-known-financial-brands/) increasing concerns over imposter sites that closely resemble registered firms, regulators and fake endorsements by individuals. These scams are often promoted through email, texts, websites and social networks. Fraudsters target investors hoping to get in “on the ground floor” with crypto assets and exploit their fear of missing out on the opportunity of a lifetime. Investors may be misled by the convincing sales pitch and the professional appearance of the fraudulent websites. Investments on fraudulent websites will appear to gain value quickly through manipulated statements. Fraudsters will strongly encourage investors to deposit additional funds using the illusion of rapid gains. Some websites will let investors withdraw a portion of their money to build trust and entice victims to invest more, but any request to withdraw all assets will fail. Ultimately, fraudsters will no longer respond to communication requests from investors. Investors are encouraged to check the CSA’s [Investor Alerts](https://www.securities-administrators.ca/InvestorAlerts.aspx?id=985) page for a list of firms and individuals to avoid. Anyone selling investments or providing investment advice in Canada, including platforms that facilitate the trading of crypto assets, must comply with applicable securities or derivatives legislation. Investors should always check the registration of any person or business trying to sell them an investment or give them investment advice. To do this, investors can visit [AreTheyRegistered.ca](http://www.aretheyregistered.ca/) **The CSA encourages investors to:** - Know the [red flags of fraud](https://www.securities-administrators.ca/investor-tools/avoiding-fraud/know-the-red-flags-of-fraud/). - Find out if the firm or individual involved is registered by checking the [CSA National Register](https://info.securities-administrators.ca/nrsmobile/nrssearch.aspx). - If the firm or individual is registered, call them using the phone number listed in the Register to confirm that the solicitation is actually from that firm or individual. - Not rely on unsolicited marketing materials. Do an internet search for the company name and verify the contact information with the financial institution or firm directly. - Check for misspellings or variations on the company name in the website or email address, including adding extra letters or hyphens to make the fake address look close to the real address. - Compare and confirm websites. Fake websites may often have odd-looking (or low resolution) logos that do not match the logo of the legitimate company. Do an internet search for the company to determine if the website is legitimate or a duplicate of the real company’s site. - Refuse to download software that allows remote access to your computer. - Never give in to pressure or blackmail: transfer your money only after taking the time to think carefully. - Never share personal information or make any payment before performing these checks. 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. **Categories:** News & Updates --- ### [CSA Publishes Staff Notice 81-334, ESG-Related Investment Fund Disclosure](https://baxsecuritieslaw.com/csa-publishes-staff-notice-81-334-esg-related-investment-fund-disclosure/) **Published:** February 7, 2022 **Author:** Barbara Hendrickson **Excerpt:** In January 2022, the Canadian Securities Administrators published Staff Notice 81-334, ESG-Related Investment Fund Disclosure (the Staff Notice). The purpose of the Staff Notice is to provide guidance on the disclosure practices of investment funds as they relate to environmental, social and governance (ESG) considerations.... **Content:** In January 2022, the Canadian Securities Administrators published *Staff Notice 81-334, ESG-Related Investment Fund Disclosure* (the Staff Notice). The purpose of the Staff Notice is to provide guidance on the disclosure practices of investment funds as they relate to environmental, social and governance (ESG) considerations. In particular, it provides guidance on funds that investment objectives reference ESG factors (ESG Funds) and other funds that use ESG strategies (ESG Strategy Funds, and together with ESG Funds, ESG-Related Funds). This Notice also provides guidance on the types of investment funds that may market themselves as being focused on ESG. The guidance provided by the Staff Notice is based on existing securities regulatory requirements and does not create any new legal requirements or modify existing ones. The Staff Notice clarifies and explains how the current securities regulatory requirements apply to ESG-related investment fund disclosure. It also includes best practices that, while not required, CSA notes that they would enhance ESG-related disclosure and sales communications. The Staff Notice aims to bring greater clarity to ESG-related fund disclosure and sales communications to enable investors to make more informed investment decisions. The full CSA Staff Notice *81-334*, *ESG-Related Investment Fund Disclosure* [may be download from CSA member websites.](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-8/81334-CSA-Staff-Notice-January-19-2022.pdf) 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. **Categories:** News & Updates --- ### [Barbara Hendrickson Recognized As A Lexpert-Ranked Lawyer In The 2022 Canadian Legal Lexpert Directory](https://baxsecuritieslaw.com/barbara-hendrickson-recognized-as-a-lexpert-ranked-lawyer-in-the-2022-canadian-legal-lexpert-directory/) **Published:** March 1, 2022 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities law is pleased to announce that its founder, Barbara Hendrickson, is recognized in the 2022 Canadian Legal Lexpert Directory as a leading lawyer in the area of Corporate Finance & Securities. Barbara Hendrickson was voted as one of the 2022 Leading Legal Practitioners across Canada based on an... **Content:** BAX Securities law is pleased to announce that its founder, Barbara Hendrickson, is recognized in the 2022 Canadian Legal Lexpert Directory as a leading lawyer in the area of Corporate Finance & Securities. Barbara Hendrickson was voted as one of the 2022 Leading Legal Practitioners across Canada based on an extensive peer survey process. BAX Securities Law has a national and cross-border focus and offers corporate and securities advice to its clients operating in a number of areas including the fintech industry (including cryptocurrency and digital assets), investment funds, real estate syndication and commodities (carbon, energy, and minerals) sectors. It specializes in online offering platforms including crowdfunding and peer-to-peer lending, and acts for public companies, venture capitalists, private equity firms and securities registrants including exempt market dealers. Barbara Hendrickson is the founder of BAX Securities Law and a senior securities lawyer with more than 20 years of experience including with the Ontario Securities Commission (OSC), a leading Canadian national firm, and one of the world’s largest international law firms. For more information about Barbara and BAX Securities Law, please see: [baxsecuritieslaw.com](https://baxsecuritieslaw.com/) **About the Canadian Legal Lexpert Directory:** The Canadian Legal Lexpert Directory identifies leading practitioners and firms is based upon a comprehensive annual survey, ongoing since 1994. The selected lawyers have been recommended by their law firm leaders. They are acknowledged as leaders in their respective fields, lawyers prominent in their practice areas and professional organizations, and professionals worthy of significant recognition from their colleagues. The Directory, published since 1997, is based on an extensive peer survey process. It includes profiles of leading practitioners across Canada in more than 65 practice areas and leading law firms in more than 41 practice areas. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators provide updated guidance on virtual shareholder meetings](https://baxsecuritieslaw.com/canadian-securities-regulators-provide-updated-guidance-on-virtual-shareholder-meetings/) **Published:** March 1, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have provided reporting issuers with guidance on virtual shareholder meetings. Since the emergence of the COVID-19 pandemic, many reporting issuers have adopted a virtual format for their shareholder meetings. These meetings are typically conducted either entirely virtually, in place of... **Content:** The Canadian Securities Administrators (CSA) have provided reporting issuers with guidance on virtual shareholder meetings. Since the emergence of the COVID-19 pandemic, many reporting issuers have adopted a virtual format for their shareholder meetings. These meetings are typically conducted either entirely virtually, in place of an in-person meeting, or through a “hybrid” format held in-person while also permitting participation via electronic means. CSA staff recently engaged in informal consultations with market participants and stakeholders to better understand their experience with virtual shareholder meetings. Due to these consultations and the still-evolving landscape for virtual shareholder meetings, the regulator is developing recommendations that will assist reporting issuers in fulfilling their obligations under securities legislation and encourage the adoption of practices that facilitate shareholder participation. The conduct of shareholder meetings is primarily governed by applicable corporate law and the reporting issuer’s organizational documents rather than securities legislation. CSA staff felt that, given the connection between securities law requirements for disclosure in respect of shareholder meetings and shareholders’ experience at such meetings, it was appropriate to provide this guidance. The CSA encourages reporting issuers to review their governing corporate legislation and documents when considering the conduct of their shareholder meetings. The full document can be downloaded from the [websites of CSA Members](https://www.securities-administrators.ca/news/canadian-securities-regulators-provide-updated-guidance-on-virtual-shareholder-meetings/). 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. **Categories:** News & Updates --- ### [CSA Issues Statement Regarding Amended Special Economic Measures (Russia) Regulations](https://baxsecuritieslaw.com/csa-issues-statement-regarding-amended-special-economic-measures-russia-regulations/) **Published:** March 20, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) is alerting all market participants to economic sanctions imposed recently by the Government of Canada under amendments to the Special Economic Measures (Russia) Regulations (the Regulations).   The Regulations, which were amended due to Russia’s invasion of Ukraine, impose broad categories of sanctions... **Content:** The Canadian Securities Administrators (CSA) is alerting all market participants to economic sanctions imposed recently by the Government of Canada under amendments to the *Special Economic Measures (Russia) Regulations* (the Regulations). The Regulations, which were amended due to Russia’s invasion of Ukraine, impose broad categories of sanctions on named Russian nationals and Russian entities. Market participants may be directly affected if they intersect with any of the “designated persons” (listed in Schedule 1, 2, or 3 of the Regulations) and their assets or property. While the sanctions apply beyond the scope of Canadian securities law, all market participants are potentially impacted, including issuers, marketplaces, clearing agencies, custodians, all categories of registrants, including crypto asset trading platforms, and pension, investment, and mutual funds and their managers. Additionally, other entities such as banks and accounting firms that facilitate relevant transactions, or provide financial or audit services concerning relevant transactions or designated persons, may be impacted. All market participants are encouraged to do their due diligence and consider obtaining expert advice to understand, follow and continually monitor their obligations under the Regulations. The Regulations impose wide-ranging restrictions in several areas. It is prohibited for any person in Canada and any Canadian outside Canada to: - Deal in any property, wherever situated, held by or on behalf of a designated person whose name is listed in Schedule 1 of the Regulations. - Enter into or facilitate, directly or indirectly, any transaction related to such a dealing. - Provide any financial or other related services in respect of such a dealing. - Make any goods, wherever situated, available to a designated person listed in Schedule 1. - Provide any financial or related service to, or for the benefit of, a designated person listed in Schedule 1. In addition, certain entities must determine continuingly whether they are in possession or control of property owned or controlled by or on behalf of a designated person. There are also requirements to report any such situation, or any proposed transaction involving such property, to the Commissioner of the RCMP. Market participants should also note that facilitating or assisting in prohibited activities is also prohibited. The regulator notes that the restrictions will impact some sectors of the economy. This includes the financial sector, where the Regulations will affect the rules regarding new debt or equity financing connected to designated persons in Schedules 2 and 3. It also expects the Regulations will affect the energy sector, including an expansive list of goods and services related to oil exploration or production (as outlined in Schedule 4 of the Regulations). CSA staff strongly recommend that, due to the shifting nature of events, market participants should review the Regulations to keep apprised of any ongoing changes. The amended *Special Economic Measures (Russia) Regulations* are available for [review on the website of the Government of Canada.](https://www.international.gc.ca/world-monde/international_relations-relations_internationales/sanctions/russia_regulations-reglement_russie.aspx?lang=eng) 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. **Categories:** News & Updates --- ### [SEC Welcomes Public Input on Climate Change Disclosures](https://baxsecuritieslaw.com/sec-welcomes-public-input-on-climate-change-disclosures/) **Published:** March 28, 2022 **Author:** Barbara Hendrickson **Excerpt:** The U.S. Securities and Exchange Commission (SEC) is requesting public input from investors, registrants, and other market participants on climate change disclosure. The SEC has periodically evaluated its regulation of climate change disclosures within the context of its integrated disclosure system. In 2010, the SEC... **Content:** The U.S. Securities and Exchange Commission (SEC) is requesting public input from investors, registrants, and other market participants on climate change disclosure. The SEC has periodically evaluated its regulation of climate change disclosures within the context of its integrated disclosure system. In 2010, the SEC issued an interpretive release that guided issuers as to how existing disclosure requirements apply to climate change matters. The 2010 Climate Change Guidance noted that, depending on the circumstances, information about climate change-related risks and opportunities might be required in a registrant’s disclosures related to its description of business, legal proceedings, risk factors, and management’s discussion and analysis of financial condition and results of operations. The release outlined certain ways in which climate change may trigger disclosure obligations under the SEC’s rules including legislation and regulations governing climate change, international accords, changes in market demand for goods or services, and physical risks associated with climate change. Since 2010, the demand for the disclosure of information regarding climate change risks, impacts, and opportunities has grown dramatically. Subsequently, questions have arisen whether climate change disclosures adequately inform investors about known material risks, uncertainties, impacts, and opportunities, and whether greater consistency could be achieved. In May 2020, the SEC Investor Advisory Committee approved recommendations urging the Commission to begin an effort to update reporting requirements for issuers to include material, decision-useful environmental, social, and governance (ESG) factors. In December 2020, the ESG Subcommittee of the SEC Asset Management Advisory Committee issued a preliminary recommendation that the Commission require the adoption of standards by which corporate issuers disclose material ESG risks. SEC staff are presently evaluating rules for climate change disclosure to ensure it provides consistent, comparable, and reliable information. As part of the process, the SEC is inviting public comment. To guide this process, the SEC is providing a series of questions, which have been published on its website. To read the complete statement and the questions from the Securities and Exchange Commission, [click here](https://www.sec.gov/news/public-statement/lee-climate-change-disclosures). For more information on the potential impact on Canadian climate change disclosure requirements, 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. **Categories:** News & Updates --- ### [Canadian Web3 Council Formed to Promote Blockchain, Cryptocurrency](https://baxsecuritieslaw.com/canadian-web3-council-formed-to-promote-blockchain-cryptocurrency/) **Published:** April 6, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Web3 Council was recently launched by industry leaders to promote the wider use of Web3 technology including blockchain and cryptocurrency. The goal of the Council, a non-profit trade association, is to encourage the growth of Web3 technology through policy innovation. The Council aims... **Content:** The Canadian Web3 Council was recently launched by industry leaders to promote the wider use of Web3 technology including blockchain and cryptocurrency. The goal of the Council, a non-profit trade association, is to encourage the growth of Web3 technology through policy innovation. The Council aims to accomplish this through a mixture of public education and advocacy with regulatory authorities and government. The association’s membership includes financial products and exchange platforms aimed at investors and open-source blockchain projects while advocating for public policy. In its opening statement, the Council warned that Canada could fall behind if the legal and regulatory challenges are not met. For more information, please click [here.](https://web3canada.ca/gm/) 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. **Categories:** News & Updates --- ### [Canada Climate Law Initiative (CCLI) Releases Response to proposed National Instrument 51-107 Disclosure of Climate-related Matters](https://baxsecuritieslaw.com/canada-climate-law-initiative-ccli-releases-response-to-proposed-national-instrument-51-107-disclosure-of-climate-related-matters/) **Published:** April 6, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canada Climate Law Initiative (CCLI) today released a report summarizing the 131 submissions the lobby group made to the Canadian Securities Administrators (CSA) on the proposed National Instrument 51-107 Disclosure of Climate-related Matters (NI 51-107). According to its authors, the report reveals strong support for strengthening... **Content:** The Canada Climate Law Initiative (CCLI) today released a report summarizing the 131 submissions the lobby group made to the Canadian Securities Administrators (CSA) on the proposed [National Instrument 51-107 Disclosure of Climate-related Matters](https://www.osc.ca/en/securities-law/instruments-rules-policies/5/51-107/51-107-consultation-climate-related-disclosure-update-and-csa-notice-and-request-comment-proposed) (NI 51-107). According to its authors, the report reveals strong support for strengthening Canadian securities law to require more effective governance of climate-related financial risks. Of the 131 submissions made in the report, 27 were made by investors, 96% of which are institutional investors with $21 trillion in assets under management. The submissions from issuers included companies in the energy, mining, automotive, agricultural, commodities, and financial services sectors. Sixteen industry associations made submissions and 64 submissions were made by a range of third parties, including foundations, law firms, accounting and actuarial organizations, financial services providers, and civil society organizations. The complete report by the Canada Climate Law Initiative [can be downloaded here](https://ccli.ubc.ca/wp-content/uploads/2022/03/CCLI-Summary-of-submissions-to-CSA.pdf). 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Request Comment on Proposed Access Equals Delivery Model for Non-Investment Fund Reporting Issuers](https://baxsecuritieslaw.com/canadian-securities-administrators-request-comment-on-proposed-access-equals-delivery-model-for-non-investment-fund-reporting-issuers/) **Published:** April 19, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published for comment a series of proposed amendments and proposed changes to implement an access equals delivery model for non-investment fund reporting issuers (the Proposed Amendments). The comment period will last 90 days. The Proposed Amendments will affect the... **Content:** The Canadian Securities Administrators (CSA) has published for comment a series of proposed amendments and proposed changes to implement an access equals delivery model for non-investment fund reporting issuers (the Proposed Amendments). The comment period will last 90 days. The Proposed Amendments will affect the provision of prospectuses, annual financial statements, interim financial reports, and related management’s discussion & analysis (MD&A) for non-investment fund reporting issuers. Except in British Columbia, the Proposed Amendments generally contemplate that access to a prospectus or any amendment has been provided if the issuer has filed the document on the System for Electronic Document Analysis and Retrieval (SEDAR) and has issued and filed a news release informing investors that the document is publicly available on SEDAR. In British Columbia, the proposed amendments provide an exemption from the prospectus delivery requirements under securities legislation subject to the same conditions, which effectively achieves the same outcome as the proposed amendments in the other jurisdictions. In all jurisdictions, the Proposed Amendments provide that the reporting issuer must issue and file a news release to inform investors that its financial statements and related MD&A are available on SEDAR, unless the reporting issuer complies with the current delivery requirements. The Proposed Amendments do not remove an investor’s ability to request documents in paper or electronic form. The Proposed Amendments can be found on the [websites](https://www.osc.ca/sites/default/files/2022-04/ni_20220407_41-101_access-delivery-model.pdf) of the participating jurisdictions. 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. **Categories:** News & Updates --- ### [Investment Industry Regulatory Organization of Canada (IIROC) Republishes Proposed Amendments Respecting the Derivatives Rule Modernization, Stage 1 – Request for Comment](https://baxsecuritieslaw.com/investment-industry-regulatory-organization-of-canada-iiroc-republishes-proposed-amendments-respecting-the-derivatives-rule-modernization-stage-1-request-for-comment/) **Published:** April 20, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Investment Industry Regulatory Organization of Canada (IIROC) has republished, for public comment for a period ending June 13, 2022, proposed amendments to the IIROC Rules (the Proposed Amendments). The goal of the Proposed Amendments (previously published in IIROC Rules Notice 19-0200) is to modernize... **Content:** The Investment Industry Regulatory Organization of Canada (IIROC) has republished, for public comment for a period ending June 13, 2022, proposed amendments to the IIROC Rules (the Proposed Amendments). The goal of the Proposed Amendments (previously published in IIROC Rules Notice 19-0200) is to modernize and simplify its derivatives-related requirements (the Initial Publication). IIROC has revised the Proposed Amendments, set out in the Initial Publication, that are designed to: - reproduce most of the Proposed Amendments using the updated version of the IIROC Rules which were implemented on December 31, 2021, and propose changes to some of the Proposed Amendments to address issues raised and suggestions made in the comment letters received on the Initial Publication, as well as comments from the Canadian Securities Administrators. The revisions to the Proposed Amendments align with the objectives and considerations outlined in the Initial Publication. A copy of the IIROC Notice, including the text of the Proposed Amendments, is available for download from the [website](https://www.osc.ca/en/industry/market-regulation/self-regulatory-organizations-sro/investment-industry-regulatory/iiroc-rule-review/investment-industry-regulatory-5) of the Ontario Securities Commission. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators move to Further Reduce Regulatory Burden](https://baxsecuritieslaw.com/canadian-securities-administrators-move-to-further-reduce-regulatory-burden/) **Published:** April 20, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) recently published changes to harmonize the interpretation of the financial statement requirements for a long-form prospectus, such as in an issuer’s initial public offering (IPO) (the changes). Specifically, the changes apply in situations where an issuer has acquired a business,... **Content:** The Canadian Securities Administrators (CSA) recently published changes to harmonize the interpretation of the financial statement requirements for a long-form prospectus, such as in an issuer’s initial public offering (IPO) (the changes). Specifically, the changes apply in situations where an issuer has acquired a business, or proposes to acquire a business, that a reasonable investor would regard as being the primary business of the issuer. The changes were informed by stakeholder feedback that certain inconsistent interpretations of the primary business requirements add time, cost, and uncertainty for issuers. The changes provide additional guidance on the interpretation of primary business including in what situations and for which time periods, financial statements would be required. They provide guidance on the circumstances when additional information may be necessary for the prospectus to meet the requirement to contain full, true, and plain disclosure of all material facts relating to the securities being distributed. The changes also clarify when an issuer can use the optional tests to calculate the significance of an acquisition, and when the acquisition of a mining asset would not be considered an acquisition of a business for securities legislation purposes. This new guidance will facilitate a harmonized approach for issuers across Canada, reducing the regulatory burden on issuers by giving them additional clarity on the historical financial information required in an IPO. 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. **Categories:** News & Updates --- ### [Canadian Financial Regulators Propose Enhanced Total Cost Report for Investment Funds and Segregated Funds](https://baxsecuritieslaw.com/canadian-financial-regulators-propose-enhanced-total-cost-report-for-investment-funds-and-segregated-funds/) **Published:** May 25, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) and the Canadian Council of Insurance Regulators (CCIR) recently published proposals that would enhance total cost reporting for investment funds and segregated funds (The Proposed Changes). The Proposed Changes aim to improve the transparency of total fees and costs paid by mutual... **Content:** The Canadian Securities Administrators (CSA) and the Canadian Council of Insurance Regulators (CCIR) recently published proposals that would enhance total cost reporting for investment funds and segregated funds (The Proposed Changes). The Proposed Changes aim to improve the transparency of total fees and costs paid by mutual fund investors and segregated fund holders. Stakeholders are invited to provide comments in writing on The Proposed Changes by **July 27, 2022.** The Proposed Changes include periodic reporting to clients showing the ongoing costs of owning segregated funds and investment funds. For securities investors, account statements would be expanded to include the fund expense ratio for each of the investment funds that the client owns, expressed as a percentage. Additionally, annual cost and compensation reports for securities investors would be expanded to include the total dollar cost of owning investment funds over the past year. For segregated funds holders, comprehensive reporting of this information would be included in a new annual report. The Proposed Changes would leverage existing requirements for account statements and annual compensation reports, rather than requiring additional documents be sent to clients. The proposals were jointly developed by the CSA, CCIR, Canadian Insurance Services Regulatory Organizations (CISRO), Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA). They reflect advance consultations with investor advocates and market participants, and draw upon behavioural insights and the results of testing sample documents with investors. The Proposed Changes follow the work securities regulators began after the completion of the Client Relationship Model, Phase 2 (CRM2) project and recommendations published by the CCIR in earlier position papers. - The proposals for the securities sector are for amendments to National Instrument 31-103 *Registration Requirements, Exemptions and Ongoing Registrant Obligations* (NI 31-103) and related guidance. IIROC and MFDA rules would be amended to be uniform in substance with final amendments to NI 31-103. - The proposals for the insurance sector are for an Individual Variable Insurance Contracts (IVICs) Ongoing Disclosure Guidance, an enhanced disclosure framework for individual segregated fund contracts. The Guidance is designed to better harmonize the insurance sector and the securities sector. The CCIR expects that each of its member jurisdictions will adopt the framework by local guidance or, in certain jurisdictions, regulation. The CSA and CCIR Joint Notice and Request for Comment of the proposed amendments and proposed guidance can be found on [CSA members’ websites](https://www.osc.ca/en/securities-law/instruments-rules-policies/3/31-103/csa-and-ccir-joint-notice-and-request-comment-proposed-amendments-national-instrument-31-103) and on the [CCIR website](https://osc.us1.list-manage.com/track/click?u=ac134df018103367c73e6fced&id=c22b8616b7&e=8954589ef9) 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. **Categories:** News & Updates --- ### [TSX Venture Exchange Publishes Bulletin Regarding Sustaining Fees](https://baxsecuritieslaw.com/tsx-venture-exchange-publishes-bulletin-regarding-sustaining-fees/) **Published:** May 27, 2022 **Author:** Barbara Hendrickson **Excerpt:** The TSX Venture Exchange (TSX-V) has published a bulletin to issuers reminding them that the 2022 annual sustaining fees were due and payable March 31, 2022. In the bulletin, TSX-V staff note that late payment can result in a late payment fee and that failure... **Content:** The TSX Venture Exchange (TSX-V) has published a bulletin to issuers reminding them that the 2022 annual sustaining fees were due and payable **March 31, 2022**. In the bulletin, TSX-V staff note that late payment can result in a late payment fee and that failure to make payment by **May 31, 2022** may result in the TSX-V proceeding to halt the Issuer’s securities. TSX-V staff advise that if trading is halted, issuers will be subject to additional fees. If payment is still not made following the halt, the issuer may be suspended. According to TSX-V staff, is will result in a reinstatement review and the possible payment of further fees. TSX-V staff advise that payment can be made in anyone of these ways: Electronic Funds Transfer (EFT), Online Banking, Credit Card (for payment amounts below CAD $10,000) and, by cheque. For further information, contact the TSX Venture Exchange at: 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. **Categories:** News & Updates --- ### [Canadian securities regulators propose changes to enhance derivatives data reporting](https://baxsecuritieslaw.com/canadian-securities-regulators-propose-changes-to-enhance-derivatives-data-reporting/) **Published:** June 14, 2022 **Author:** Barbara Hendrickson **Excerpt:** Members of the Canadian Securities Administrators (CSA) recently published for comment for a five-month period ending October 7, 2022, a set of proposals  (the Proposed Amendments) designed to streamline and internationally harmonize over-the-counter derivatives data reporting standards. The Proposed Amendments are expected to reduce the... **Content:** Members of the Canadian Securities Administrators (CSA) recently published for comment for a five-month period ending October 7, 2022, a set of proposals (the Proposed Amendments) designed to streamline and internationally harmonize over-the-counter derivatives data reporting standards. The Proposed Amendments are expected to reduce the complexity of market participants’ reporting systems and decrease ongoing operational and compliance costs while improving the consistency and quality of the data available to regulators and the public. The Proposed Amendments update the data elements to be reported to align with North American and global standards developed by the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO). In addition to harmonizing data reporting standards, other proposed amendments include: - updated requirements for trade repository governance, operations and management of risk to align with international standards; - improvements designed to enhance data accuracy and consistency, such as data validation and verification, similar to other global regulators; - increased harmonization among the CSA, such as a harmonized threshold in the commodity derivatives exclusion for non-dealers; and, - new technical manuals that provide clarity regarding the format and values for reporting. The Proposed Amendments have been published on the following CSA member websites: - In Manitoba, the Proposed Amendments to Manitoba Securities Commission (MSC) Rule 91-507 Trade Repositories and Derivatives Data Reporting; proposed changes to MSC Companion Policy 91-507CP; proposed changes to MSC Companion Policy 91-506CP, and MSC Staff Notice 91-701 Draft MSC Derivatives Data Technical Manual are available on [the Manitoba Securities Commission’s website](https://osc.us1.list-manage.com/track/click?u=ac134df018103367c73e6fced&id=eaa613fa9f&e=8954589ef9). - In Ontario the Proposed Amendments to [*OSC Rule 91-507 Trade Repositories and Derivatives Data Reporting*; proposed changes to OSC Companion Policy 91-507CP; proposed changes to OSC Companion Policy 91-506CP](https://osc.us1.list-manage.com/track/click?u=ac134df018103367c73e6fced&id=5adf75c4fa&e=8954589ef9); and [OSC Staff Notice 91-705 *Draft OSC Derivatives Data Technical Manual*](https://osc.us1.list-manage.com/track/click?u=ac134df018103367c73e6fced&id=346f4468da&e=8954589ef9)are available on the Ontario Securities Commission’s website. - In Quebec, *Regulation to amend Regulation 91-507 respecting Trade Repositories and Derivatives Data Reporting*and the proposed changes to *Policy Statement to Regulation 91-507 respecting Trade Repositories* *and Derivatives Data Reporting* and to *Policy* *Statement* *to Regulation 91-506 respecting derivatives determination* are available on [the Autorité des marchés financiers’ website](https://osc.us1.list-manage.com/track/click?u=ac134df018103367c73e6fced&id=a017bd1da2&e=8954589ef9). The draft AMF Derivatives Data Technical Manual is published in Appendix A to the Policy Statement to Regulation 91-507. In each of the other Canadian jurisdictions, the Proposed Amendments to Multilateral Instrument 96-101 *Trade Repositories and Derivatives Data Reporting*; and proposed changes to the Companion Policy 96-101CP are available on each [CSA member’s website](https://osc.us1.list-manage.com/track/click?u=ac134df018103367c73e6fced&id=c91de37513&e=8954589ef9). The proposed Multilateral Derivatives Data Technical Manual is published in Appendix A to the Companion Policy 96-101CP. Interested stakeholders should submit their comments in writing to the CSA no later than October 7, 2022. 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. **Categories:** News & Updates --- ### [Changes to Registration Requirements, Exemptions and Ongoing Registrant Obligations, and Ontario Securities Commission Rule 33-506 (Commodity Futures Act) Registration Information in Effect](https://baxsecuritieslaw.com/changes-to-registration-requirements-exemptions-and-ongoing-registrant-obligations-and-ontario-securities-commission-rule-33-506-commodity-futures-act-registration-information-in-effect/) **Published:** June 14, 2022 **Author:** Barbara Hendrickson **Excerpt:** On June 6, 2022, pursuant to section 143.4 of the Securities Act (Ontario), amendments to the following rules came into force: National Instrument 33-109 Registration Information (NI 33-109), and National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103). Furthermore, on June 6,... **Content:** On June 6, 2022, pursuant to section 143.4 of the *Securities Act* (Ontario), amendments to the following rules came into force: - National Instrument 33-109 *Registration Information* (**NI 33-109**), and - National Instrument 31-103 *Registration Requirements, Exemptions and Ongoing Registrant Obligations* (**NI 31-103**). Furthermore, on June 6, 2022, pursuant to section 69 of the *Commodity Futures Act* (Ontario), amendments to Ontario Securities Commission Rule 33-506 (*Commodity Futures Act*) Registration Information (**OSC Rule 33-506**) came into force. The amendments to NI 33-109, NI 31-103 and OSC Rule 33-506, as well as corresponding changes to their Companion Policies, were published in the Bulletin on December 16, 2021 at (2021), 44 OSCB Supp-4. 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. **Categories:** News & Updates --- ### [Joint Forum of Financial Market Regulators Receive Early Feedback Regarding Total Cost Reporting and Climate Change ](https://baxsecuritieslaw.com/joint-forum-of-financial-market-regulators-receive-early-feedback-regarding-total-cost-reporting-and-climate-change/) **Published:** June 24, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Joint Forum of Financial Market Regulators (Joint Forum) held its annual meeting on June 15, 2022. The Joint Forum brings together members of the Canadian Securities Administrators (CSA), the Canadian Council of Insurance Regulators (CCIR), the Canadian Association of Pension Supervisory Authorities (CAPSA) and... **Content:** The Joint Forum of Financial Market Regulators (Joint Forum) held its annual meeting on June 15, 2022. The Joint Forum brings together members of the Canadian Securities Administrators (CSA), the Canadian Council of Insurance Regulators (CCIR), the Canadian Association of Pension Supervisory Authorities (CAPSA) and representatives from the Canadian Insurance Services Regulatory Organizations (CISRO), as well as from the Mortgage Broker Regulators’ Council of Canada (MBRCC). The Joint Forum heard feedback from key stakeholders representing industry associations and consumer advocates regarding the Total Cost Reporting (TCR) consultation. The TCR consultation ([CSA members’ websites](https://www.securities-administrators.ca/access-rules-policies/) and [CCIR website](https://www.ccir-ccrra.org/)) proposes enhanced cost disclosure reporting requirements for investment funds and segregated funds. Enhanced cost disclosure increases public protection by improving investors’ and policy holders’ awareness of ongoing embedded fees and contributes toward informed financial decisions. The consultation was launched on April 28, 2022, and formal submissions will be accepted until July 27, 2022. The Joint Forum members received initial comments on scope and implementation issues, level of information for investors and policyholders; and the proposed transition period. The Joint Forum members also received presentations about climate change, in particular, the frequency, severity and costs of extreme weather events. Attendees were warned about the potentially intense effects of a disorderly transition to a lower-carbon economy, which is driving regulators to accelerate and focus their efforts on climate-related risks. Pension plans, the group was warned, need to assess their resilience to climate-related risks and meet their fiduciary obligations in an uncertain economic environment. 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. **Categories:** News & Updates --- ### [QR Code](https://baxsecuritieslaw.com/qr/) **Published:** March 19, 2022 **Author:** Barbara Hendrickson **Content:** ![](https://baxsecuritieslaw.com/wp-content/uploads/2024/03/Barbara_Hendrickson-1024x1024.png) **Categories:** News & Updates --- ### [Comment Period on Mineral Disclosure Consultation Extended](https://baxsecuritieslaw.com/comment-period-on-mineral-disclosure-consultation-extended/) **Published:** July 4, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have extended the consultation period for CSA Consultation Paper 43-401 Consultation on National Instrument 43-101 Standards of Disclosure for Mineral Projects (The Consultation Paper) a further 60 days, now ending on September 13, 2022. Stakeholders have indicated that it would... **Content:** The Canadian Securities Administrators (CSA) have extended the consultation period for CSA Consultation Paper 43-401 *Consultation on National Instrument 43-101 Standards of Disclosure for Mineral Projects* (The Consultation Paper) a further 60 days, now ending on September 13, 2022. Stakeholders have indicated that it would be beneficial to have additional time to properly review and assess the issues outlined in the consultation paper and to provide comments. *CSA Consultation Paper 43-401 Consultation on National Instrument 43-101 Standards of Disclosure for Mineral Projects, as* well as instructions for submitting comments, are available for download from the [CSA Member’s websites](https://www.securities-administrators.ca/news/canadian-securities-regulators-extend-comment-period-on-mineral-disclosure-consultation/?utm_medium=email&utm_campaign=PR_20220630MINING&utm_source=Envoke-General-Updates&utm_term=CSA-News-release-%2F-ACVM-Commun). 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish 2022 – 2025 Business Plan](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-2022-2025-business-plan/) **Published:** July 12, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published 2022-2025 CSA Business Plan (The Business Plan). The Business Plan, approved on June 9, 2022, sets out the priorities that the CSA has committed to pursue collaboratively over the next three years. The priorities adapted by the CSA... **Content:** The Canadian Securities Administrators (CSA) have published *2022-2025 CSA Business Plan* (The Business Plan). The Business Plan, approved on June 9, 2022, sets out the priorities that the CSA has committed to pursue collaboratively over the next three years. The priorities adapted by the CSA consist of six Strategic Goals: 1. Strengthen the capital markets regulatory system; 2. Optimize investors’ ability to contribute to policymaking and expand investor education outreach; 3. Improve investor protection by enhancing investors’ ability to obtain redress and strengthening the advisor-client relationship; 4. Address emerging market issues and trends; 5. Deliver smart and responsive regulation protecting investors while reducing regulatory burden; and, 6. Promote integrity and financial stability through effective market oversight. While the CSA will focus on the above initiatives, it remains strongly committed to other regulatory projects and ongoing initiatives dealing with the improvement of its internal processes and the maintenance of an efficient and seamless relationship among all Canadian securities regulators as well as with federal and foreign regulatory agencies. It will also continue to monitor the international situation for ongoing developments. The complete *2022-2025 CSA Business Plan* can be [downloaded from the CSA’s website](https://www.securities-administrators.ca/wp-content/uploads/2022/06/2022_2025CSA_BusinessPlan.pdf). 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. **Categories:** News & Updates --- ### [Chartered Professional Accountants of Canada Publish Climate Governance Guide](https://baxsecuritieslaw.com/chartered-professional-accountants-of-canada-publish-climate-governance-guide/) **Published:** August 5, 2022 **Author:** Barbara Hendrickson **Excerpt:** Amid the continuing challenges posed by climate change, The Chartered Professional Accountants of Canada (CPA Canada) has published its guide for audit committees in their oversight of climate change, Climate Change – A Role for Audit Committees (the Guide). The Guide stresses the continuing importance of... **Content:** Amid the continuing challenges posed by climate change, The Chartered Professional Accountants of Canada (CPA Canada) has published its guide for audit committees in their oversight of climate change, *Climate Change – A Role for Audit Committees* (the Guide). The Guide stresses the continuing importance of audit committees in considering and overseeing management’s decisions related to climate change. Its authors note that the publication is suitable for audit committees of corporations of all sizes. *Climate Change – A Role for Audit Committees* can be downloaded from the [website of the Chartered Professional Accountants of Canada.](https://www.cpacanada.ca/en/business-and-accounting-resources/strategy-risk-and-governance/corporate-governance/publications/audit-committee-oversight-climate-change) 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. **Categories:** News & Updates --- ### [Alberta and Saskatchewan Expand Self-Certified Investor Prospectus Exemption](https://baxsecuritieslaw.com/alberta-and-saskatchewan-expand-self-certified-investor-prospectus-exemption/) **Published:** August 5, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Alberta Securities Commission (ASC) and the Financial and Consumer Affairs Authority of Saskatchewan (FCAA) have amended the self-certified investor prospectus exemption in response to market feedback to provide greater flexibility to businesses and investors in Alberta and Saskatchewan (the amendments). The self-certified prospectus exemption... **Content:** The Alberta Securities Commission (ASC) and the Financial and Consumer Affairs Authority of Saskatchewan (FCAA) have amended the self-certified investor prospectus exemption in response to market feedback to provide greater flexibility to businesses and investors in Alberta and Saskatchewan (the amendments). The self-certified prospectus exemption allows certain investors to invest alongside accredited investors, subject to certain limits. The investor must certify to having a level of financial and investment knowledge and acknowledge that they understand the investment considerations and risks. To mitigate investment risk, businesses are limited to accepting investments from self-certified investors to $10,000 in any one business and $30,000 across multiple businesses in a calendar year. A goal of the amendments is to allow self-certified investors to be treated in a manner generally similar to accredited investors. They allow for the sale of securities by a business and for a resale by an existing security holder to a self-certified investor. They are similar to the resale provisions in the accredited investor exemption. The amendments also allow businesses to sell their securities to certain qualifying special purpose vehicles, in which both accredited investors and self-certified investors participate, without being subject to the investment limits that apply when selling securities to other self-certified investors. The self-certified investor prospectus exemption has been implemented on a three-year pilot basis expiring on March 31, 2024. Details of the amended exemption are set out in Multilateral CSA Notice of Amendments to Alberta and Saskatchewan Orders 45-538 *Self-Certified Investor Prospectus Exemption*, which is [available for download](https://www.asc.ca/-/media/ASC-Documents-part-1/Regulatory-Instruments/2022/07/6031266-Amended-Multilateral-CSA-Notice-Prospectus-Exemption-for-Self-Certified-Investors.ashx). 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. **Categories:** News & Updates --- ### [OSC Publishes First Pre-Registration Undertakings by Crypto Platforms](https://baxsecuritieslaw.com/osc-publishes-first-pre-registration-undertakings-by-crypto-platforms/) **Published:** August 18, 2022 **Author:** Barbara Hendrickson **Excerpt:** On August 15, 2022, the Ontario Securities Commission (OSC) the published the first pre-registration undertakings filed by crypto currency trading platforms Coinsquare Capital Markets Ltd. and Crypto.com (the platforms). The undertakings provided by the platforms to the OSC are an important first step towards the... **Content:** On August 15, 2022, the Ontario Securities Commission (OSC) the published the first pre-registration undertakings filed by crypto currency trading platforms Coinsquare Capital Markets Ltd. and Crypto.com (the platforms). The undertakings provided by the platforms to the OSC are an important first step towards the provision of digital and crypto asset services in Canada. Other Canadian Securities Administrators (CSA) members are currently in discussions with other crypto trading platforms regarding pre-registration undertakings. Once provided, these undertakings will be published on the CSA’s website. CSA staff expect such platforms to provide a pre-registration undertaking to their principal regulator to continue operations while their application is reviewed. By giving these undertakings, crypto trading platforms agree to comply with terms and conditions that address investor protection concerns and are consistent with requirements currently applicable to registered platforms. The CSA advises that its members may take enforcement action if a crypto trading platform is not prepared to file an undertaking or does not abide by the terms of an undertaking. On March 29, 2021, the CSA and the Investment Industry Regulatory Organization of Canada (IIROC) published a notice outlining securities law requirements that apply to crypto trading platforms. All crypto trading platforms registered in Canada or that have provided a pre-registration undertaking to a CSA member, are listed on the[ CSA’s website.](https://www.securities-administrators.ca/resources/regulatory-sandbox/decisions/) Please see the CSA news release: https://www.securities-administrators.ca/news/canadian-securities-regulators-expect-commitments-from-crypto-trading-platforms-pursuing-registration/? 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. **Categories:** News & Updates --- ### [OSC Grants Exemptive Relief to Fractionvest Inc.](https://baxsecuritieslaw.com/osc-grants-exemptive-relief-to-fractionvest-inc/) **Published:** August 23, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (the OSC) through its Innovation Office, will provide exemptive relief (the exemption) to Franctionvest Inc. (Franctionvest), an Ontario corporation from the requirement to register under Ontario securities legislation to conduct a short-term pilot of its business model. The exemption temporarily relieves... **Content:** The Ontario Securities Commission (the OSC) through its Innovation Office, will provide exemptive relief (the exemption) to Franctionvest Inc. (Franctionvest), an Ontario corporation from the requirement to register under Ontario securities legislation to conduct a short-term pilot of its business model. The exemption temporarily relieves Fractionvest from the requirement to register as a dealer under Section 25 of The Securities Act (Ontario), in respect of the operation of the Platform and other activities in connection with the Pilot Test. The exemption expires on the earlier date which is 18 months after the date of the decision, or the date on which the Filer becomes registered. Fractionvest seeks to test a platform that uses blockchain technology to distribute tokens that represent a fractional ownership in a real estate asset. The exemption that will allow the pilot test to go forward comes with certain conditions imposed by the OSC. These include: The pilot test will involve a single property located in the Greater Toronto Area and will only be available to no more than 100 accredited investors that complete Fractionvest’s onboarding process. The property will be owned by a limited partnership under the laws of Ontario, where the token holders will participate as limited partners, with the value of the tokens acquired by each investor not to exceed $150,000. Fractionvest plans to rent the property; the token holders will receive regular distributions of rental income less expenses. Franctionvest has also agreed it must submit a registration application nine months after the date of the decision. The decision in its entirety can be [download from the website](https://www.osc.ca/en/securities-law/orders-rulings-decisions/fractionvest-inc) of the Ontario Securities Comission. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Adopt Streamlined Capital-Raising Option For Canadian-Listed Issuers](https://baxsecuritieslaw.com/canadian-securities-regulators-adopt-streamlined-capital-raising-option-for-canadian-listed-issuers/) **Published:** September 13, 2022 **Author:** Barbara Hendrickson **Excerpt:** On September 8, 2022, The Canadian Securities Administrators (CSA) announced that it was adopting the Listed Issuer Financing Exemption (the new prospectus exemption). Developed for smaller issuers listed on a Canadian stock exchange, it will provide a more efficient way to raise capital. The new... **Content:** On September 8, 2022, The Canadian Securities Administrators (CSA) announced that it was adopting the Listed Issuer Financing Exemption (the new prospectus exemption). Developed for smaller issuers listed on a Canadian stock exchange, it will provide a more efficient way to raise capital. The new prospectus exemption is detailed in *CSA Notice of Amendments to National Instrument 45-106 Prospectus Exemptions to Introduce the Listed Issuer Financing Exemption*. Once adopted, the new prospectus exemption will reduce costs for issuers raising smaller amounts of capital through the public markets. It will also allow smaller issuers greater access to retail investors and provide retail investors with a broader choice of investments. The goal is to reduce regulatory burden for small offerings while maintaining investor protection. The new prospectus exemption will be available to issuers that have been a reporting issuer in a Canadian jurisdiction for at least 12 months and have filed all continuous disclosure documents required under Canadian securities legislation. Eligible issuers will need to file a short offering document. Issuers using this exemption may annually raise up to the greater of $5 million or 10 per cent of the issuer’s market capitalization, to a maximum of $10 million. Securities issued under the exemption will be freely tradeable. In response to comments received by the CSA on the proposed exemption, changes were made to increase investor protection, including imposing primary offering statutory liability in the event of a misrepresentation in the issuer’s offering document or certain continuous disclosure. Provided all necessary Ministerial approvals are obtained, the amendments will come into force on November 21, 2022. Copies of *CSA Notice of Amendments to National Instrument 45-106 Prospectus Exemptions to Introduce the Listed Issuer Financing Exemption* are [available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/4/45-106/csa-notice-amendments-national-instrument-45-106-prospectus-exemptions-introduce-listed-issuer) from websites of CSA members. 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. **Categories:** News & Updates --- ### [Toronto Stock Exchange Publishes Housekeeping Rule Amendments to the TSX Company Manual ](https://baxsecuritieslaw.com/toronto-stock-exchange-publishes-housekeeping-rule-amendments-to-the-tsx-company-manual/) **Published:** September 13, 2022 **Author:** Barbara Hendrickson **Excerpt:** On September 8th, 2022, the Toronto Stock Exchange (TSX) adopted certain housekeeping amendments (the Amendments) to TSX Company Reporting Form 2E -- Change in Transfer Agent & Registrar (Reporting Form 2E) and Reporting Form 5 -- Dividend/Distribution Declaration (Reporting Form 5) of the TSX Company... **Content:** On September 8th, 2022, the Toronto Stock Exchange (TSX) adopted certain housekeeping amendments (the Amendments) to TSX Company Reporting Form 2E — Change in Transfer Agent & Registrar **(**Reporting Form 2E) and Reporting Form 5 — Dividend/Distribution Declaration (Reporting Form 5) of the TSX Company Manual (the Manual). The adoption of the Amendments in accordance with the Process for the Review and Approval of Rules and the Information Contained in Form 21-101F1 (the Protocol). The Ontario Securities Commission (OSC) has approved The Amendments are Housekeeping Rules under the Protocol and therefore they have not been published for comment. The OSC has not disagreed with the categorization of the Amendments as Housekeeping Rules. Under Section 5 of the Protocol, TSX has obtained a waiver from the OSC in connection with the requirements to obtain approval from the board of directors of TSX. The TSX Housekeeping Rule Amendments are [available for download](https://www.osc.ca/sites/default/files/2022-09/tsx_20220908_housekeeping-amendments-to-tsx-manual.pdf) from the Ontario Security Commission’s website. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Initiate Review of Mutual Fund Securities Distribution through a Principal Distributor](https://baxsecuritieslaw.com/canadian-securities-regulators-initiate-review-of-mutual-fund-securities-distribution-through-a-principal-distributor/) **Published:** September 29, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) is reviewing the practices of mutual funds that have principal distributor relationships with registrants to distribute their securities. The goal of the review is to gauge whether additional updates to the mutual fund sales practice rule are needed to improve... **Content:** The Canadian Securities Administrators (CSA) is reviewing the practices of mutual funds that have principal distributor relationships with registrants to distribute their securities. The goal of the review is to gauge whether additional updates to the mutual fund sales practice rule are needed to improve investor protection and maintain investor confidence (Review). The first phase of the CSA’s review includes surveying investment fund managers and principal distributors about the scope of their arrangements. The survey for investment fund managers identified as using a principal distributor was sent in early September. The information obtained will provide a better understanding of the sales practices and distribution structures of mutual funds and registrants. It will also help the CSA determine whether regulatory amendments to [National Instrument 81-105 *Mutual Fund Sales Practices*](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/8--investment-funds/current/81-105) or other instruments are needed in light of the CSA’s recent work in developing its client-focused reforms. The Review is aligned with the 2022 – 2025 CSA’s Business Plan. The Business Plan is available for download from the website of the CSA. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Propose Access-Based Model for Investment Fund Reporting Issuers](https://baxsecuritieslaw.com/canadian-securities-regulators-propose-access-based-model-for-investment-fund-reporting-issuers/) **Published:** September 29, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has proposed a series of amendments that would provide an alternative to delivering financial statements and management reports of fund performance for investment fund reporting issuers (the Proposed Amendments). The Proposed Amendments are published for a 90-day consultation period ending... **Content:** The Canadian Securities Administrators (CSA) has proposed a series of amendments that would provide an alternative to delivering financial statements and management reports of fund performance for investment fund reporting issuers (the Proposed Amendments). The Proposed Amendments are published for a 90-day consultation period ending December 26, 2022. Together, the Proposed Amendments encompass proposed amendments to National Instrument 81-106 Investment Fund Continuous Disclosure (NI 81-106) and Companion Policy 81-106CP Continuous Disclosure Obligations (81-106CP), proposed consequential amendments to National Instrument 41-101 General Prospectus Requirements (NI 41-101), and National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101). The Proposed Amendments will modernize existing delivery practices for investment fund continuous disclosure documents by increasing online availability and accessibility, which recognizes increased investor preference for accessing information electronically. This means investors will have access to information in a timely and environmentally friendly manner while also retaining the option to request documents in the form, either paper or electronic, that bests suit their needs. Investment funds will benefit from reduced long-term costs and regulatory burden without impacting investor protection. To ensure clear investor communication and notification practices are in place, the amendments would require investment fund reporting issuers to: - Post continuous disclosure documents on their designated websites. - Alert investors when new documents are available by issuing a news release, which would also be posted to their designated websites and filed on the System for Electronic Document Analysis and Retrieval (SEDAR). - Send paper or electronic copies of the documents to investors upon request or in accordance with standing instructions. Although the Proposed Amendments do not extend an access-based model to documents other than continuous disclosure documents, the CSA is looking to determine if there are other changes to delivery requirements that should be contemplated, such as changes that might facilitate broader adoption of electronic delivery of documents. The Proposed Amendments can be [downloaded from the website](https://nssc.novascotia.ca/sites/default/files/docs/2022-09-27%20CSA%20Notice%20%28Revised%29%28Sept.27.Publication%29.pdf) of members of the Canadian Securities Commission. Written comments must be submitted no later than December 26, 2022. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [MFDA and IIROC Members Approve the Creation of a Single New SRO](https://baxsecuritieslaw.com/mfda-and-iiroc-members-approve-the-creation-of-a-single-new-sro/) **Published:** October 4, 2022 **Author:** Barbara Hendrickson **Excerpt:** The members of the Mutual Fund Dealers Association of Canada (MFDA) and the Investment Industry Regulatory Organization of Canada (IIROC) have passed a special resolution approving the amalgamation of the two self-regulatory organizations (SROs) into a new single SRO, focused on fostering an innovative and... **Content:** The members of the Mutual Fund Dealers Association of Canada (MFDA) and the Investment Industry Regulatory Organization of Canada (IIROC) have passed a special resolution approving the amalgamation of the two self-regulatory organizations (SROs) into a new single SRO, focused on fostering an innovative and competitive industry and delivering value for investors. Effective January 1, 2023, subject to the conditions outlined in the Combination Agreement, the MFDA and IIROC will become one organization that will temporarily be known as the New Self-Regulatory Organization of Canada (New SRO). The move follows an in-depth consultation by the MFDA and IIROC with the Canadian Securities Administrators (CSA) staff. The Members of both SROs passed the special resolution by more than the required two-thirds of members entitled to vote. The New SRO will enhance investor protection by creating a separate investor office dedicated to investor education and to help support rule development. There will also be a dedicated Investor Advisory Panel to advise the New SRO on issues related to investors. The New SRO will deliver more efficient regulation and create a level regulatory playing field for investment firms across Canada. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [TSX Venture Exchange Publishes Update on Listed Issuer Financing Exemption](https://baxsecuritieslaw.com/tsx-venture-exchange-publishes-update-on-listed-issuer-financing-exemption/) **Published:** October 11, 2022 **Author:** Barbara Hendrickson **Excerpt:** TSX Venture Exchange (TSX-V) recently published an update for members on the Canadian Securities Administrators’ (CSA) Listed Issuer Financing Exemption (the Exemption) (discussed in-depth here). The Exemption is designed to streamline the capital raising process for smaller listed prospectus issuers by reducing the costs for... **Content:** TSX Venture Exchange (TSX-V) recently published an update for members on the Canadian Securities Administrators’ (CSA) Listed Issuer Financing Exemption (the Exemption) ([discussed in-depth here](https://baxsecuritieslaw.com/canadian-securities-regulators-adopt-streamlined-capital-raising-option-for-canadian-listed-issuers/)). The Exemption is designed to streamline the capital raising process for smaller listed prospectus issuers by reducing the costs for raising smaller amounts through the capital markets. TSX-V staff note that securities issued under the Exemption will not be subject to the four-month hold period set out in section 2.5 of National Instrument 45-102 – *Resale of Securities*. As a result, and subject to regulatory approval, the TSX-V intends to make certain changes to the definition of “Exchange Hold Period” in Policy 1.1 – *Interpretation* of the TSX Corporate Finance Manual to enable Issuers to take advantage of the intended benefits of the Exemption. It is anticipated by TSX-V staff, that with the granting of the necessary Ministerial approvals, the Exemption will come into force November 21, 2022. The TSX Corporate Finance Manual is available for reference [ online.](https://www.tsx.com/listings/tsx-and-tsxv-issuer-resources/tsx-venture-exchange-issuer-resources?lang=en) Copies of *CSA Notice of Amendments to National Instrument 45-106 Prospectus Exemptions to Introduce the Listed Issuer Financing Exemption* are [available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/4/45-106/csa-notice-amendments-national-instrument-45-106-prospectus-exemptions-introduce-listed-issuer) from websites of CSA members. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Strengthening Ombudsman for Banking Services and Investments](https://baxsecuritieslaw.com/canadian-securities-regulators-strengthening-ombudsman-for-banking-services-and-investments/) **Published:** October 19, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) is developing a proposal for comment that contemplates providing the Ombudsman for Banking Services and Investments (OBSI) with the authority to make awards that are binding on firms. CSA members continue to develop the proposal and anticipate issuing it for... **Content:** The Canadian Securities Administrators (CSA) is developing a proposal for comment that contemplates providing the Ombudsman for Banking Services and Investments (OBSI) with the authority to make awards that are binding on firms. CSA members continue to develop the proposal and anticipate issuing it for public comment in the coming year. The contemplated framework aims to balance investors’ need for an accessible procedure with the need for fairness, proportionality, and efficiency. OBSI’s mandate from the CSA as an independent dispute resolution service for investments has been in place since 2014. OBSI also serves a similar function for banking, having been approved as an External Complaints Body by the federal government. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators consider impact of international developments on proposed climate-related disclosure rule](https://baxsecuritieslaw.com/canadian-securities-regulators-consider-impact-of-international-developments-on-proposed-climate-related-disclosure-rule/) **Published:** October 19, 2022 **Author:** Barbara Hendrickson **Excerpt:** In October 2021, the Canadian Securities Administrators (CSA) published the Proposed National Instrument NI 51-107 Disclosure of Climate-related Matters (the Proposed National Instrument) for comment. Before publishing the Proposed National Instrument, CSA staff noted a growing consensus towards climate-related disclosure, as well as widespread market... **Content:** In October 2021, the Canadian Securities Administrators (CSA) published the Proposed National Instrument *NI 51-107 Disclosure of Climate-related Matters* (the Proposed National Instrument) for comment. Before publishing the Proposed National Instrument, CSA staff noted a growing consensus towards climate-related disclosure, as well as widespread market acceptance, based on the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD). The Proposed National Instrument, which would introduce climate-related disclosure requirements for reporting issuers (other than investment funds), is also modelled on the TCFD recommendations. Since that time, international developments have given CSA staff pause to consider the impact of these events and how they may impact the development of climate change disclosure in Canada. These international developments include: - In March 2022, the United States Securities and Exchange Commission (SEC) [proposed amendments to rules](https://www.sec.gov/news/press-release/2022-46) that would require registrants to provide certain climate-related information in their registration statements and annual reports. - In November 2021, the International Sustainability Standards Board (ISSB) [published a proposed general standard](https://www.ifrs.org/content/dam/ifrs/groups/trwg/trwg-general-requirements-prototype.pdf) for sustainability disclosure. While the CSA, SEC, and ISSB proposals are all based on TCFD recommendations, there are some substantial differences between them. CSA staff continue to monitor the evolution of these proposals as well as conduct a detailed comparison between them. Additionally, the CSA is currently revisiting letters it received on the Proposed National Instrument that included feedback on the two international proposals, as well as reviewing Canadian stakeholder feedback that was submitted directly to the SEC and ISSB. *National Instrument 51-107 Disclosure of Climate-related Matters* is [available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/5/51-107/51-107-consultation-climate-related-disclosure-update-and-csa-notice-and-request-comment-proposed) from the websites of the participating CSA jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Webinar Invite: The evolution of cryptocurrency dealer regulation in Canada: AML and beyond](https://baxsecuritieslaw.com/webinar-invite-the-evolution-of-cryptocurrency-dealer-regulation-in-canada-aml-and-beyond/) **Published:** October 26, 2022 **Author:** Barbara Hendrickson **Excerpt:**   Please join Barbara Hendrickson and Addison Cameron-Huff on November 9th at 12:00 PM EST for a webinar to discuss the evolving Canadian regulatory landscape for cryptocurrency and other digital assets.  Speakers will address: Recent regulatory guidance from the Canadian Securities Administrators (August 15, 2022) - “Canadian securities... **Content:** **Please join Barbara Hendrickson and Addison Cameron-Huff on November 9th at 12:00 PM EST for a webinar** to discuss the evolving Canadian regulatory landscape for cryptocurrency and other digital assets. Speakers will address: - Recent regulatory guidance from the Canadian Securities Administrators (August 15, 2022) – “Canadian securities regulators expect commitments from crypto trading platforms pursuing registration” - Recent regulatory guidance from FINTRAC (August 18, 2022) on requirements for Canadian and foreign firms dealing in virtual currencies to register as a money service business - Compliance considerations for crypto market participants - Recent enforcement trends If you are currently involved in cryptocurrency activity in Canada or wish to enter the Canadian cryptocurrency market as a participant please join us on November 9th. Please RSVP to bhendrickson@baxsecuritieslaw.com. Participants will have the opportunity to ask questions online prior to and during the webinar. Yours truly, **Barbara Hendrickson** BAX Securities Law **Categories:** News & Updates --- ### [OSC Pilots Self-Certified Investor Prospectus Exemption](https://baxsecuritieslaw.com/osc-pilots-self-certified-investor-prospectus-exemption/) **Published:** October 28, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) recently launched an 18-month pilot, providing a prospectus exemption (the prospectus exemption) to those Ontario investors with qualifying education or work experience access to increased investment opportunities. The exemption also has the added benefit of giving businesses headquartered in Ontario... **Content:** The Ontario Securities Commission (OSC) recently launched an 18-month pilot, providing a prospectus exemption (the prospectus exemption) to those Ontario investors with qualifying education or work experience access to increased investment opportunities. The exemption also has the added benefit of giving businesses headquartered in Ontario access to a new source of investment capital. The prospectus exemption was set out as an interim order under [*Ontario Instrument 45-507 Self-Certified Investor Prospectus Exemption (Interim Class Order)*](https://www.osc.ca/en/securities-law/instruments-rules-policies/4/45-507) In Ontario, most of the capital raised from individuals under prospectus exemptions is raised using the accredited investor exemption. While many investors have investment knowledge gained through education or industry experience, others do not meet this accredited investor criteria. Some investors may not also meet the criteria for other prospectus exemptions, such as the employee prospectus exemption. To invest through the prospectus exemption, investors must certify that they have met at least one qualifying criteria and review and complete a risk acknowledgment form confirming they understand the risks of investing. Investors will also be subject to a $30,000 annual limit on all purchases and can choose to allocate that amount to one or multiple issuers. Issuers must report the use of the self-certified prospectus exemption by filing reports of exempt distribution. The OSC will use this data to monitor the use of the prospectus exemption and to inform future policymaking. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Complete Eighth Review of the Representation of Women on Boards and in Executive Officer Positions in Canada](https://baxsecuritieslaw.com/canadian-securities-administrators-complete-eighth-review-of-the-representation-of-women-on-boards-and-in-executive-officer-positions-in-canada/) **Published:** October 28, 2022 **Author:** Barbara Hendrickson **Excerpt:** Participating Canadian securities regulatory authorities recently published the results their eighth annual review of disclosures relating to women on boards and in executive officer positions. The findings summarize the corporate governance disclosures of 625 non-venture issuers and have been published by securities regulatory authorities in... **Content:** Participating Canadian securities regulatory authorities recently published the results their eighth annual review of disclosures relating to women on boards and in executive officer positions. The findings summarize the corporate governance disclosures of 625 non-venture issuers and have been published by securities regulatory authorities in Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Ontario, Quebec, Saskatchewan, and Yukon (the participating jurisdictions). Key highlights include: - Twenty-four per cent of board seats are held by women, an increase of two per cent since last year. - The percentage of board vacancies filled by women increased 10 per cent – from 35 per cent last year to 45 per cent this year. - Eighty-seven per cent of issuers have at least one woman on their board, an increase of five per cent since last year. - Thirty per cent of issuers have at least three women on their board, an increase of six per cent since last year. - Seven per cent of issuers have a woman chairing their board. The complete CSA Multilateral Staff Notice 58-314 *Review of Disclosure Regarding Women on Boards and in Executive Officer Positions (Year 8 Report)*, is available for download on CSA member [websites](https://www.securities-administrators.ca/news/canadian-securities-regulators-announce-results-of-eighth-annual-review-of-representation-of-women-on-boards-and-in-executive-officer-positions-in-canada/?utm_medium=email&utm_campaign=PR_20221027_WOB&utm_source=Envoke-General-Updates&utm_term=CSA-News-release-%2F-ACVM-Commun). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Publish Report on Continuous Disclosure Review](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-report-on-continuous-disclosure-review/) **Published:** November 14, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) recently published CSA Staff Notice 51-364 Continuous Disclosure Review Program Activities for the fiscal years ended March 31, 2022 and March 31, 2021 (the Staff Notice, the Review), a biennial review of its continuous disclosure program. The Review assesses reporting... **Content:** The Canadian Securities Administrators (CSA) recently published *CSA Staff Notice 51-364 Continuous Disclosure Review Program Activities for the fiscal years ended March 31, 2022 and March 31, 202*1 *(*the Staff Notice, the Review), a biennial review of its continuous disclosure program. The Review assesses reporting issuers’ compliance with securities laws, with the objective of improving the completeness and quality of their disclosures. It includes results from recent reviews assessing compliance with certain aspects of non-GAAP (Generally Accepted Accounting Principles) and other financial measures disclosure requirements. Common deficiencies reported by the Review included: - Financial Statements: compliance with the recognition, measurement, presentation, classification, and disclosure requirements in IFRS (International Financial Reporting Standards) including revenue recognition, disclosure of expected credit losses, disclosure of business combinations and disclosure of reportable segments. - MD&A: compliance with Form 51-102F1 Management’s Discussion & Analysis including forward-looking information, discussion of operations specific to development and/or early-stage issuers, and non-GAAP and other financial measures. - Other Regulatory Requirements: compliance with other regulatory matters including overly promotional disclosure pertaining to environmental, social and governance (ESG) matters, audit committee requirements, inconsistencies throughout continuous disclosure documents, required disclosures in a reverse takeover transaction and mineral project disclosure. *CSA Staff Notice 51-364 Continuous Disclosure Review Program Activities for the fiscal years ended March 31, 2022 and March 31, 2021* [is available for download](https://www.osc.ca/sites/default/files/2022-11/csa_20221103_51-364_continuous-disclosure-review.pdf) from websites of CSA Members. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [OSC Seeks Comment on Draft Statement of 2023-2024 Priorities](https://baxsecuritieslaw.com/osc-seeks-comment-on-draft-statement-of-2023-2024-priorities/) **Published:** December 12, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has published OSC Notice 11-797 – Statement of Priorities Request for Comments Regarding Statement of Priorities for Financial Year to End March 31, 2024 (The Draft Statement of Priorities) for comment from stakeholders for a 30-day period ending December 22,... **Content:** The Ontario Securities Commission (OSC) has published *OSC Notice 11-797 – Statement of Priorities Request for Comments Regarding Statement of Priorities for Financial Year to End March 31, 2024* (The Draft Statement of Priorities) for comment from stakeholders for a 30-day period ending December 22, 2023 The Draft Statement of Priorities sets out the strategic goals the OSC intends to focus its resources and actions on, as well as priority initiatives the OSC will pursue to support its strategic goals. Written comments can be submitted until December 22, 2022. Following review of the comments, any necessary revisions will be incorporated into the final 2023-2024 Statement of Priorities which will be published as part of the OSC Business Plan in Spring 2023. *OSC Notice 11-797 – Statement of Priorities Request for Comments Regarding Statement of Priorities for Financial Year to End March 31, 2024* is [available for download](https://www.osc.ca/sites/default/files/2022-11/20221122_11-797_statement-of-priorities-2023-2024_EN.pdf) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA and IIROC Issue Joint Staff Notice 23-329, Short Selling in Canada](https://baxsecuritieslaw.com/csa-and-iiroc-issue-joint-staff-notice-23-329-short-selling-in-canada/) **Published:** December 12, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) have issued joint Staff Notice, 23-329, Short Selling in Canada (the Joint Staff Notice), to gather input from stakeholders regarding the regulatory framework surrounding short selling in Canada. The Joint Staff... **Content:** The Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) have issued joint Staff Notice, 23-329, *Short Selling in Canada* (the Joint Staff Notice), to gather input from stakeholders regarding the regulatory framework surrounding short selling in Canada. The Joint Staff Notice offers an overview of the existing regulatory landscape for short selling, including rules governing failure to settle trades, and provides an update on current related initiatives, and request public feedback on areas for regulatory consideration. The CSA and IIROC welcome feedback on the staff notice, which includes several consultation questions. Comments should be submitted in writing on or before March 8, 2023. Joint CSA and IIROC Staff Notice, 23-329, *Short Selling in Canada*, is [available for download](https://www.osc.ca/sites/default/files/2022-12/csa-iiroc_20221208_23-329_short-selling.pdf) from the website of IIROC and of participating CSA jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Amends National Instrument 45-106 Prospectus Exemptions](https://baxsecuritieslaw.com/csa-amends-national-instrument-45-106-prospectus-exemptions/) **Published:** December 12, 2022 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has announced it is amending (the Amendments) National Instrument 45-106 Prospectus Exemptions (NI 45-106). Provided all necessary ministerial approvals are obtained, the Amendments will come into force on March 8, 2023. The Amendments set out new disclosure requirements for issuers... **Content:** The Canadian Securities Administrators (CSA) has announced it is amending (the Amendments) *National Instrument 45-106 Prospectus Exemptions* (NI 45-106). Provided all necessary ministerial approvals are obtained, the Amendments will come into force on March 8, 2023. The Amendments set out new disclosure requirements for issuers that are engaged in “real estate activities” (Real Estate Issuers) and issuers that are “collective investment vehicles” (CIVs) when those issuers are preparing an offering memorandum (OM). An offering memorandum is a disclosure document that describes a company’s business, includes financial statements, discusses relevant risks, and explains how the company will use the money it raises. The offering memorandum prospectus exemption allows an issuer to sell its securities to a wider range of people than typically allowed for private placements. The regulator intends that the new requirements will set out a clear disclosure framework for these issuers, giving them greater certainty as to what they must disclose, and giving better information to investors. Additionally, the Amendments include general amendments (the General Amendments), which clarify parts of NI 45-106 and improve disclosure for investors. Generally, the Amendments include but are not limited to: - Removal of the requirement, in all jurisdictions except Ontario (see below) for ongoing distributions to amend the OM to include an interim financial report for the issuer’s most recently completed six-month period - The Ontario Securities Commission (OSC), while viewing the six-month requirement as appropriate, has added an exemption to the requirement that would allow issuers meeting certain conditions to not amend their OM to include an interim financial report for the issuer’s most recently completed six-month period. - Revision of the Appraisal Requirements, including the removal of the requirement for an appraisal if a Real Estate Issuer were using a material amount of the proceeds of the offering to acquire an interest in real property. - Revisions to definitions, including those of a CIV and deletion of the definition of “net asset value” as the latter confirms the generally accepted meaning. - Revisions to Form 45-106F2 *Offering Memorandum for Non-Qualifying Issuers.* *National Instrument 45-106 Prospectus Exemptions* (NI 45-106) is [available for download](https://www.osc.ca/sites/default/files/2022-09/20220908_45-106_csa-amendments-listed-issuer-financing-exemption.pdf) from the websites of participating CSA members. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish CSA Staff Notice 81-334, ESG-Related Investment Fund Disclosure](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-csa-staff-notice-81-334-esg-related-investment-fund-disclosure/) **Published:** February 1, 2023 **Author:** Barbara Hendrickson **Excerpt:** Over the last few years, so-called sustainable investing, especially those that follow environmental, social and governance (ESG) considerations has grown. Reacting to this development, the Canadian Securities Administrators (CSA) Published Staff Notice 81-334, ESG Related Funds Disclosure (the Staff Notice) on January 27, 2023. The... **Content:** Over the last few years, so-called sustainable investing, especially those that follow environmental, social and governance (ESG) considerations has grown. Reacting to this development, the Canadian Securities Administrators (CSA) Published *Staff Notice 81-334, ESG Related Funds Disclosure* (the Staff Notice) on January 27, 2023. The Staff Notice provides guidance on the disclosure practices of investment funds based on (ESG) considerations, and in particular those investment funds whose investment strategies that are based on ESG practices (ESG Funds), investment funds that use ESG strategies (ESG Strategy Funds, and together with ESG Funds, ESG-Related Funds). The Staff Notice also provides guidance on the types of investment funds that may market themselves as being focused on ESG. Rather than break new ground, the Staff Notice builds upon and clarifies existing securities regulation including how the current securities regulatory requirements apply to ESG-related investment fund disclosure. It also includes examples of suggested best practices to enhance ESG-related disclosure and sales communications. The Staff Notice reviews common ESG-related terms and strategies. It also discusses recent international and domestic developments in the field of ESG investing, including the recommendations from the 2021 Report from the International Organization of Securities Commissions (IOSCO) relating to investment product-level disclosure. The Staff Notice also provides guidance for ESG-Related Funds, and their investment fund managers, to enhance the ESG-related aspects of the funds’ regulatory disclosure documents and ensure that the sales communications of such funds are not untrue or misleading and are consistent with the investment funds’ regulatory offering documents. CSA Staff Notice 81-334, *ESG-Related Investment Fund Disclosure* [is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/8/81-334/csa-staff-notice-81-334-esg-related-investment-fund-disclosure) from the websites of participating CSA jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish Exemption for Reporting Issuers](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-exemption-for-reporting-issuers/) **Published:** February 8, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Security Administrators (CSA) have published an Exemption for Reporting Issuers incorporated under the Canada Business Corporations Act (CBCA). The Exemption provides relief from the proxy requirement for the uncontested election of directors. The CSA has implemented the relief through local blanket orders that... **Content:** The Canadian Security Administrators (CSA) have published an Exemption for Reporting Issuers incorporated under the *Canada Business Corporations Act* (CBCA). The Exemption provides relief from the proxy requirement for the uncontested election of directors. The CSA has implemented the relief through local blanket orders that are substantively harmonized across the country. The blanket orders exempt CBCA- incorporated reporting issuers from the director election form of proxy requirement in subsection 9.4(6) of NI 51-102 *Continuous Disclosure Obligations* (NI 51-102) in respect of the uncontested election of directors. On August 31, 2022, amendments to the CBCA and associated regulation came into effect that generally require “majority voting” for each candidate nominated for director in uncontested director elections of CBCA-incorporated reporting issuers. Where majority voting applies, the form of proxy required by the CBCA must provide shareholders with the option to specify whether their vote is to be cast “for” or “against” each candidate nominated for director, rather than “voted” or “withheld” from voting as required by subsection 9.4(6) of NI 51-102. The CSA is considering whether future proposed amendments to subsection 9.4(6) of NI 51-102 are appropriate. Any such amendments would be adopted by the CSA through the normal rule-making procedures on a coordinated basis. CSA Staff Notice regarding CSA Coordinated Blanket Order 51-930 *Exempting Reporting Issuers Incorporated under the Canada Business Corporations Act from the Director Election Form of Proxy Requirement* and the local blanket orders are [available for download from the websites of CSA members](https://www.osc.ca/en/securities-law/instruments-rules-policies/5/51-930). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law has been listed in Ontario Securities Commission’s Beta Innovation Office Directory](https://baxsecuritieslaw.com/bax-securities-law-has-been-listed-in-ontario-securities-commissions-beta-innovation-office-directory/) **Published:** February 17, 2023 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law is pleased to announce that it has been listed on the Ontario Security Commission (OSC) Beta Innovation Office Directory. The Directory, developed by the OSC Innovation Office, connects experienced law firms with the start-up and innovation community.  BAX Securities Law is proud... **Content:** BAX Securities Law is pleased to announce that it has been listed on the Ontario Security Commission (OSC) Beta Innovation Office Directory. The Directory, developed by the OSC Innovation Office, connects experienced law firms with the start-up and innovation community. BAX Securities Law is proud to be listed in the Directory and be able to support the fintech and crypto asset sectors. See For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish Staff Notice 21-332 Crypto Asset Trading Platforms: Pre-Registration Undertakings Changes to Enhance Canadian Investor Protection](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-staff-notice-21-332-crypto-asset-trading-platforms-pre-registration-undertakings-changes-to-enhance-canadian-investor-protection/) **Published:** February 24, 2023 **Author:** Barbara Hendrickson **Excerpt:** On February 22, 20233, the Canadian Securities Administrators (CSA) published Staff Notice 21-332, Crypto Asset Trading Platforms: Pre-Registration Undertakings Changes to Enhance Canadian Investor Protection (Staff Notice 21-332). Staff Notice 21-332 follows the CSA’s December 12, 2022 update regarding crypto trading platforms. Staff Notice 21-332... **Content:** On February 22, 20233, the Canadian Securities Administrators (**CSA**) published Staff Notice 21-332, *Crypto Asset Trading Platforms: Pre-Registration Undertakings Changes to Enhance Canadian Investor Protection* (**Staff Notice 21-332**). Staff Notice 21-332 follows the CSA’s December 12, 2022 [update](https://www.securities-administrators.ca/news/csa-provides-update-to-crypto-trading-platforms-operating-in-canada/) regarding crypto trading platforms. Staff Notice 21-332 describes the enhanced investor protection the CSA expects from crypto trading platforms operating. Unregistered crypto trading platforms operating in Canada while pursuing applications for registration and related relief are expected to provide an enhanced pre-registration undertaking to their principal regulator within 30 days of its publication on February 22, 2022. The CSA expects all crypto trading platforms to adopt enhanced pre-registration undertakings, to continue operating in Canada while pursuing their applications for registration with Canadian securities regulators. These pre-registration undertakings will include, among other things, enhanced expectations regarding the custody and segregation of crypto assets held on behalf of Canadian clients and a prohibition on offering margin, credit, or other forms of leverage to any Canadian client. They will also prohibit crypto trading platforms from permitting clients to purchase or deposit value-referenced crypto assets (commonly referred to as stable coins) and proprietary tokens without the prior written consent of the CSA. According to the CSA Staff Notice 21-332, if a crypto trading platform fails to provide an enhanced pre-registration undertaking within the 30 day period, the CSA will take appropriate action including ordering off-boarding of existing Canadian users and imposing restrictions on Canadian users generally; cease trading the crypto trading platforms as well as other penalties and sanctions as may be determined. CSA Staff Notice 21-332, *Crypto Asset Trading Platforms: Pre-Registration Undertakings Changes to Enhance Canadian Investor Protection* [is available for download](https://www.osc.ca/sites/default/files/2023-02/csa_20230222_21-332_crypto-trading-platforms-pre-reg-undertakings.pdf) from the websites of CSA Members. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Announce Enhanced Pre-Registration Undertaking Requirements for Crypto Trading Platforms](https://baxsecuritieslaw.com/canadian-securities-administrators-announce-enhanced-pre-registration-undertaking-requirements-for-crypto-trading-platforms/) **Published:** February 27, 2023 **Author:** Barbara Hendrickson **Excerpt:** Please join Barbara Hendrickson of BAX Securities Law (www.baxsecuritieslaw.com) and Addison Cameron-Huff (www.cameronhuff.com) on March 3, 2023, at 1:00 ET for a seminar on the most recent notice from the Canadian Securities Administrators (CSA) - Staff Notice 21-332 Crypto Asset Trading Platforms: Changes to Enhance... **Content:** Please join Barbara Hendrickson of BAX Securities Law (www.baxsecuritieslaw.com) and Addison Cameron-Huff (www.cameronhuff.com) on March 3, 2023, at 1:00 ET for a seminar on the most recent notice from the [Canadian Securities Administrators (CSA) – Staff Notice 21-332 Crypto Asset Trading Platforms: Changes to Enhance Canadian Investors Protections (CSA Notice 21-332)](https://www.osc.ca/en/securities-law/instruments-rules-policies/2/21-332/csa-staff-notice-21-332-crypto-asset-trading-platforms-pre-registration-undertakings-changes). Published on February 22, 2023, CSA Notice 21-332 provides guidance to unregistered market participants operating crypto trading platforms in Canada. CSA Notice 21-332 sets out enhanced guidance for unregistered crypto trading platforms including the expectation that unregistered crypto trading platforms provide an enhanced pre-registration undertaking to their principal regulator within 30 days of the publication of CSA Notice 21-332. We will cover the following topics in the one-hour seminar: · The CSA requirement to obtain restricted dealer registration and exemptive relief to operate a crypto trading platform in Canada; · Who must file pre-registration undertakings with principal regulators; · Terms and conditions of the pre-registration undertakings; · Securities regulation of Stablecoins; and · Regulatory consequences for non-compliance. ## **Webinar Details:** ## **Friday, March 3, 2023 | 1–2 p.m. ET** ## [**RSVP HERE**](mailto:bhendrickson@baxsecurities.com) **Categories:** News & Updates --- ### [Proposed Changes to Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) to impact Non-Bank Mortgage Lenders](https://baxsecuritieslaw.com/proposed-changes-to-proceeds-of-crime-money-laundering-and-terrorist-financing-act-pcmltfa-to-impact-non-bank-mortgage-lenders/) **Published:** March 10, 2023 **Author:** Barbara Hendrickson **Excerpt:** Proposed Amendments (The Proposed Amendments) to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) will affect non-bank mortgage lenders, making them subject to the legislation. Announced in early February, The Proposed Amendments ensure that non-bank mortgage lenders will receive proper supervision under... **Content:** Proposed Amendments (The Proposed Amendments) to the *Proceeds of Crime (Money Laundering) and Terrorist Financing Act* (PCMLTFA) will affect non-bank mortgage lenders, making them subject to the legislation. Announced in early February, The Proposed Amendments ensure that non-bank mortgage lenders will receive proper supervision under the PCMLTFA. The Proposed Amendments are open to review and public comment for s period ending March 20, 2023. The complete text of the Proposed Amendment to the *Proceeds of Crime (Money Laundering) and Terrorist Financing Act* (PCMLTFA) is [available for download](https://www.gazette.gc.ca/rp-pr/p1/2023/2023-02-18/html/reg4-eng.html). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Draft Regulations to Retail Payment Activities Act Released for Public Comment](https://baxsecuritieslaw.com/draft-regulations-to-retail-payment-activities-act-released-for-public-comment/) **Published:** March 10, 2023 **Author:** Barbara Hendrickson **Excerpt:** Proposed Regulations (the Proposed Regulations) under the Retail Payment Activities Act (RPAA) have been released for public comment for a period ending March 28, 2023. The RPAA, which received Royal Assent in June, 2021 and the proposed Regulations introduce a new retail payment supervisory regime... **Content:** Proposed Regulations (the Proposed Regulations) under the *Retail Payment Activities Act (RPAA)* have been released for public comment for a period ending March 28, 2023. The RPAA, which received Royal Assent in June, 2021 and the proposed Regulations introduce a new retail payment supervisory regime for the retail payment activities of Payment Service Providers (PSPs) in Canada. The payment activities of PSPs, which include card networks, payment processors, and digital wallets, are currently not supervised in Canada. The federal Department of Finance believes the lack of requirements and supervision increases risks to Canadians, such as the risk of financial loss in instances of business insolvency, and threats to the security of sensitive personal and financial information of Canadians and Canadian businesses. The Draft Regulations for the Retail Payment Activities Act [are available for download](https://canadagazette.gc.ca/rp-pr/p1/2023/2023-02-11/html/reg3-eng.html). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [OSC Publishes Notice of Approval and Summary of Comments – Amendments to CSE Listing Policies – Canadian Securities Exchange](https://baxsecuritieslaw.com/osc-publishes-notice-of-approval-and-summary-of-comments-amendments-to-cse-listing-policies-canadian-securities-exchange/) **Published:** April 1, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has approved significant changes (the “Amendments”) to the Listing Policies and Forms of the Canadian Securities Exchange (CSE). It has published The Amendments as Canadian Securities Exchange – Amendments to CSE Listing Policies – Notice of Approval and Summary of... **Content:** The Ontario Securities Commission (OSC) has approved significant changes (the “Amendments”) to the Listing Policies and Forms of the Canadian Securities Exchange (CSE). It has published The Amendments as *Canadian Securities Exchange – Amendments to CSE Listing Policies – Notice of Approval and Summary of Comments.* The Amendments become effective April 3, 2023. The Amendments introduce the following main changes: - qualifications, requirements and financial reporting obligations that reflect requirements for non-venture issuers that would apply to CSE Listed Issuers designated by the CSE as “NV Issuers”; - requirements and provisions for listing Special Purpose Acquisition Corporations (SPACs) and Exchange Traded Funds (ETFs), including Closed End Funds (CEFs); and, - additional corporate governance requirements for all CSE Listed Issuers, including security holder approvals, and specific requirements related to restricted securities and take-over bid protections, normal course issuer bids, shareholder rights plans and security-based compensation plans. These additional requirements are consistent with requirements of other Canadian exchanges for venture issuers and non-venture issuers. *Canadian Securities Exchange – Amendments to CSE Listing Policies – Notice of Approval and Summary of Comments* is [available for download](https://www.osc.ca/sites/default/files/2023-03/cse_20230330_notice-summary-comments.pdf) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Progress Made on new Ontario’s Self-Regulating Body](https://baxsecuritieslaw.com/progress-made-on-new-ontarios-self-regulating-body/) **Published:** April 1, 2023 **Author:** Barbara Hendrickson **Excerpt:** The New Self-Regulatory Organization of Canada (New SRO), is seeking to become a credential providing organization for financial advisors under FSRA’s Financial Professionals Title Protection Framework. The New SRO, launched in January 2023, is the result of the merger of the Investment Industry Regulatory Organization... **Content:** The New Self-Regulatory Organization of Canada (New SRO), is seeking to become a credential providing organization for financial advisors under FSRA’s Financial Professionals Title Protection Framework. The New SRO, launched in January 2023, is the result of the merger of the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA). It will oversee among other things, how individuals working at mutual fund or investment dealers that provide investment advice to Ontario. The New SRO is working with the Financial Services Regulatory Authority of Ontario (FSRA) so that New SRO can become a credentialing body. If adapted, the New SRO will have the authority to grant credentials permitting the use of the ‘Financial Advisor’ title under Ontario’s [*Financial Professionals Title Protection Act, 2019* (FPTPA)](https://www.ontario.ca/laws/statute/19f07b?search=Financial%20Professionals%20Title%20Protection%20Act). The approval will be subject to conditions as outlined in the [Financial Professionals Title Protection (FPTP) Rule](https://www.fsrao.ca/media/5566/download) and related guidance. Being credentialled will also give more value both the Financial Advisor title and the New SRO’s registrants. FSRA is also proposing an amendment to the [FSRA Fee Rule](https://www.fsrao.ca/media/11431/download) that, if approved, would reduce New SRO’s fees, to recognize that the OSC already provides oversight of its activities. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Publishes for Comment Proposed Amendments to Form 58-101F1 Corporate Governance Disclosure of National Instrument 58-101 Disclosure of Corporate Governance Practices and Proposed Changes to National Policy 58-201 Corporate Governance Guideline](https://baxsecuritieslaw.com/csa-publishes-for-comment-proposed-amendments-to-form-58-101f1-corporate-governance-disclosure-of-national-instrument-58-101-disclosure-of-corporate-governance-practices-and-proposed-changes-to-nation/) **Published:** April 18, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) are publishing for a 90-day comment period ending July 12, 2023 its amendments (the Proposed Amendments) to Corporate Governance Disclosure. In particular: proposed amendments to Form 58-101F1 Corporate Governance Disclosure (Form 58-101F1) of National Instrument 58-101 Disclosure of Corporate Governance... **Content:** The Canadian Securities Administrators (CSA) are publishing for a 90-day comment period ending July 12, 2023 its amendments (the Proposed Amendments) to Corporate Governance Disclosure. In particular: - proposed amendments to Form 58-101F1 Corporate Governance Disclosure (Form 58-101F1) of National Instrument 58-101 Disclosure of Corporate Governance Practices (NI 58-101) pertaining to board nominations, board renewal and diversity, as well as ancillary amendments to section 1.1 Definitions of NI 58-101 (the Proposed Amendments); and - proposed changes to National Policy 58-201 Corporate Governance Guidelines (NP 58-201) pertaining to board nominations, board renewal and diversity (the Proposed Changes) *Proposed Amendments to Form 58-101F1 Corporate Governance Disclosure of National Instrument 58-101 Disclosure of Corporate Governance Practices and Proposed Changes to National Policy 58-201 Corporate Governance Guideline* [is available for download](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-5/58101-CSA-Notice-and-Request-for-Comment-April-13-2023.pdf?dt=20230412204852) from the websites of CSA Members. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Publishes Crypto Exchange Update](https://baxsecuritieslaw.com/csa-publishes-crypto-exchange-update/) **Published:** April 18, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) recently announced in of CSA Staff Notice 21-332 (the Staff Notice) a change in the Pre-Registration Undertaking (PRU) that certain unregistered crypto asset trading platforms have filed a with their principal regulator. The failure of several recent high-profile crypto platforms,... **Content:** The Canadian Securities Administrators (CSA) recently announced in of CSA Staff Notice 21-332 (the Staff Notice) a change in the Pre-Registration Undertaking (PRU) that certain unregistered crypto asset trading platforms have filed a with their principal regulator. The failure of several recent high-profile crypto platforms, has shown the need for the introduction further investor protections into the PRU. The resultant Enhanced PRU is a precondition for CSA members allowing unregistered crypto trading platforms to continue to operate while the crypto trading platforms pursue their applications for registration and related relief. PRUs contain commitments by crypto trading platforms that they will operate in a certain manner during the registration process. The new commitments expected from unregistered crypto trading platforms include: - enhanced commitments in relation to the custody and segregation of crypto assets held on behalf of Canadian clients; - enhanced commitments to preclude the unregistered crypto trading platform from pledging, rehypothecating or otherwise using crypto assets held on behalf of Canadian clients; - a prohibition on the part of the crypto trading platform offering margin, credit or other forms of leverage to any type of client in connection with the trading of crypto contracts or crypto assets on the crypto trading platform; - new commitments from controlling mind(s) and global affiliates that affect the crypto trading platform entity seeking registration and relief; - restrictions on the part of the crypto trading platform relying on crypto assets, including proprietary tokens issued by the crypto trading platform or an affiliate of the crypto trading platform, in determining the capital of the crypto trading platform for excess working capital purposes and in determining the capital base of the crypto trading platform; - enhanced commitments in relation to the filing by the crypto trading platform of financial information with the CSA on a regular basis; - enhanced commitments in relation to the retention of a qualified Chief Compliance Officer (CCO) during the pre-registration process; - a prohibition on the part of the crypto trading platform in respect of clients buying or depositing stablecoins through crypto contracts without the prior written consent of the CSA; and - a prohibition on the part of the crypto trading platform in respect of trades in crypto contracts based on proprietary tokens, except with the prior written consent of the CSA. CSA Staff Notice 21-332, *Crypto Asset Trading Platforms: Pre-Registration Undertakings Changes to Enhance Canadian Investor Protection* [is available for download](https://www.osc.ca/sites/default/files/2023-02/csa_20230222_21-332_crypto-trading-platforms-pre-reg-undertakings.pdf) from the websites of CSA Members. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Publish Annual Activities Report on the Oversight of SROs and Investor Protection Funds](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-annual-activities-report-on-the-oversight-of-sros-and-investor-protection-funds/) **Published:** April 27, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published CSA Staff Notice 25-310 2022 Annual Activities Report on the Oversight of Self-Regulatory Organizations (SROs) and Investor Protection Funds (IPFs) (The Annual Report). The Annual Report summarizes key information, activities, and observations related to CSA oversight of the... **Content:** The Canadian Securities Administrators (CSA) has published *CSA Staff Notice 25-310 2022 Annual Activities Report on the Oversight of Self-Regulatory Organizations* (SROs) *and Investor Protection Funds* (IPFs) (The Annual Report). The Annual Report summarizes key information, activities, and observations related to CSA oversight of the former SROs and IPFs during the 2022 calendar year. In January, 2023, the two former SROs – the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada – officially amalgamated to form the New Self- Regulatory Organization of Canada. And the former IPFs – the Canadian Investor Protection Fund and the MFDA Investor Protection Corporation – merged to form the new Canadian Investor Protection Fund. CSA Staff Notice 25-310 *2022 Annual Activities Report on the Oversight of Self-Regulatory Organizations* (SROs) *and Investor Protection Funds* (IPFs) [is available for download](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/2-certain-capital-market-participants/current/25-310/25310-csa-staff-notice-april-20-2023) from the websites of CSA Members. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [OSC and CSE Publish Notice of Approval and Summary of Comments for Canadian Securities Exchange – Amendments to CSE Listing Policies](https://baxsecuritieslaw.com/osc-and-cse-publish-notice-of-approval-and-summary-of-comments-for-canadian-securities-exchange-amendments-to-cse-listing-policies/) **Published:** April 27, 2023 **Author:** Barbara Hendrickson **Excerpt:** In accordance with the Process for the Review and Approval of Rules and the Information Contained in Form 21-101F1 and the Exhibits Thereto, CNSX Markets Inc. (CSE) has proposed, and the Ontario Securities Commission (the OSC) has approved significant changes (the Amendments) to the CSE... **Content:** In accordance with the Process for the Review and Approval of Rules and the Information Contained in Form 21-101F1 and the Exhibits Thereto, CNSX Markets Inc. (CSE) has proposed, and the Ontario Securities Commission (the OSC) has approved significant changes (the Amendments) to the CSE Listing Policies and Forms. The Amendments, which came into effect April 3, 2023, introduced the following main changes: - qualifications, requirements and financial reporting obligations that reflect requirements for non-venture issuers that would apply to CSE Listed Issuers designated by the CSE as “NV Issuers”; - requirements and provisions for listing Special Purpose Acquisition Corporations (SPACs) and Exchange Traded Funds (ETFs), including Closed End Funds (CEFs); and, - additional corporate governance requirements for all CSE Listed Issuers, including security holder approvals, and specific requirements related to restricted securities and take-over bid protections, normal course issuer bids, shareholder rights plans and security-based compensation plans. These additional requirements are consistent with requirements of other Canadian exchanges for venture issuers and non-venture issuers. The Amendments were published for comment on December 9, 2021. The comment period expired on February 7, 2022, with 16 comment letters received. A summary of the comments and CSE’s responses, as well as a copy of the CSE Notice, [are available for download](https://www.osc.ca/sites/default/files/2023-03/cse_20230330_summary_of_comments.pdf) from the OSC’s website. The amended policies and related forms are [available for download](https://www.osc.ca/sites/default/files/2023-03/cse_20230330_summary_of_comments.pdf) from the CSE’s website. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadians securities regulators review use of chargebacks by securities registrants](https://baxsecuritieslaw.com/canadians-securities-regulators-review-use-of-chargebacks-by-securities-registrants/) **Published:** June 5, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) is launching a review of the use of chargebacks in the mutual fund industry. The CSA is undertaking this review due to concerns about potential conflicts of interest associated with this practice. A chargeback involves an upfront commission paid directly... **Content:** The Canadian Securities Administrators (CSA) is launching a review of the use of chargebacks in the mutual fund industry. The CSA is undertaking this review due to concerns about potential conflicts of interest associated with this practice. A chargeback involves an upfront commission paid directly by a life insurer or other provider to s financial advisor on the sale of a segregated fund. They occur when investors redeem their securities before a fixed schedule as determined by the dealer firm, and the dealing representative is required to pay back all or part of the upfront commissions and fees. The review is aligned with the CSA’s 2022-2025 CSA Business Plan, which includes assessing whether additional mutual fund sales practice rule modernization is needed to improve investor protection and maintain investor confidence in Canadian capital markets. The review will include a survey of securities registrants on their use of chargebacks. It will also involve Canadian Investment Regulatory Organization (CIRO) staff participation. On September 8, 2022, the Canadian Council of Insurance Regulators (CCIR) and the Canadian Insurance Services Regulatory Organizations (CISRO) released for public consultation a discussion paper on upfront compensation paid for the sale and servicing of segregated funds and individual variable insurance contracts, which identified chargebacks as possible conflicts of interest. On May 15, 2023, the CCIR and CISRO published a news release indicating that there is a risk of customer harm with the use of chargebacks and that they will develop guidance on the controls that need to be in place. While the use of chargebacks is not as common for the distribution of mutual funds relative to the distribution of segregated funds, chargebacks raise the same conflict of interest concerns for mutual fund distribution. The review of chargebacks follows, and complements, the review of the practices of mutual funds that have principal distributor relationships with registrants to distribute their securities, announced in September 2022. The CSA will use the information obtained from both reviews to determine whether regulatory amendments to National Instrument 81-105 Mutual Fund Sales Practices or other instruments are needed now that the Client Focused Reforms have been implemented. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators publish CSA Staff Notice 45-330: Frequently Asked Questions about the Listed Issuer Financing Exemption](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-csa-staff-notice-45-330-frequently-asked-questions-about-the-listed-issuer-financing-exemption/) **Published:** June 5, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published CSA Staff Notice 45-330: Frequently Asked Questions about the Listed Issuer Financing Exemption (The Staff Notice). The Staff Notice answers some of the frequently asked questions (FAQs) on the listed issuer financing exemption (the exemption) adopted by all securities... **Content:** The Canadian Securities Administrators (CSA) have published CSA Staff Notice 45-330: Frequently Asked Questions about the Listed Issuer Financing Exemption (The Staff Notice). The Staff Notice answers some of the frequently asked questions (FAQs) on the listed issuer financing exemption (the exemption) adopted by all securities regulatory authorities in Canada in November 2022. Subject to certain conditions, the exemption allows reporting issuers listed on a Canadian exchange to raise the greater of $5,000,000 or 10% of the issuer’s market capitalization to a maximum total dollar amount of $10,000,000 in a 12-month period by distributing securities to investors. The list of FAQs is not exhaustive, but it includes key issues and questions market participants have posed to us and our preliminary observations on offerings using the exemption to date. CSA staff advise they may update these FAQs from time to time as necessary. *CSA Staff Notice 45-330: Frequently Asked Questions about the Listed Issuer Financing Exemption* is [available for download](https://www.osc.ca/sites/default/files/2023-06/csa_20230601_45-330_faq.pdf) from the websites of participating members. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian securities regulators defer launch of new SEDAR+ filing system](https://baxsecuritieslaw.com/canadian-securities-regulators-defer-launch-of-new-sedar-filing-system/) **Published:** June 5, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have postponed the launch of SEDAR+  from June 13, 2023 to July 25, 2023. SEDAR+ is the new system that will be used by all market participants to file, disclose, and search for issuer information in Canada’s capital markets. CSA... **Content:** The Canadian Securities Administrators (CSA) have postponed the launch of SEDAR+ from June 13, 2023 to July 25, 2023. SEDAR+ is the new system that will be used by all market participants to file, disclose, and search for issuer information in Canada’s capital markets. CSA staff advise that while the SEDAR+ system itself is functioning well, the migration of large volumes of data from multiple legacy systems is taking longer than planned. The SEDAR+ project leadership team has added an additional six weeks to the project timeline to ensure that the data migration meets the CSA’s strict quality control standards. If data migration is not completed in time for the July launch date, the CSA has set September 12, 2023, as a contingency launch date. To assist filing organizations with planning for SEDAR+, the CSA will confirm the SEDAR+ go-live date by the end of June. Until SEDAR+ goes live, all capital market participants are required to continue using SEDAR and the other systems in current use. Importantly, the [flat-fee model anno](https://www.securities-administrators.ca/news/canadian-securities-regulators-announce-rules-to-support-new-sedar-filing-system/)[u](https://www.securities-administrators.ca/news/canadian-securities-regulators-announce-rules-to-support-new-sedar-filing-system/)[nced on March 23, 2023](https://www.securities-administrators.ca/news/canadian-securities-regulators-announce-rules-to-support-new-sedar-filing-system/), which reduces overall annual system fee costs by seven per cent, will still come into effect on June 9, 2023 and will apply to all SEDAR and National Registration Database (NRD) filings. Details about how to apply the flat-fee model in SEDAR will be added to the [SEDAR+ Launch page](https://www.securities-administrators.ca/about-sedar/sedar-transition/launch/) on June 5, 2023. On June 8, 2023, the CSA and member jurisdictions will issue a CSA Notice and Blanket Orders to support the date change. In the meantime, market participants can visit the SEDAR+ Launch page on the CSA website for more information, including the revised cutover period dates. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Exempts Certain Filing Requirements During SEDAR+ Launch](https://baxsecuritieslaw.com/csa-exempts-certain-filing-requirements-during-sedar-launch/) **Published:** June 15, 2023 **Author:** Barbara Hendrickson **Excerpt:** Participating members of the Canadian Securities Administrators (CSA) are issuing exemptions from certain filing requirements (the blanket orders) due to delays in the implementation of SEDAR+. The CSA now expects the launch date to be July 25, 2023, with a contingency date in September. In... **Content:** Participating members of the Canadian Securities Administrators (CSA) are issuing exemptions from certain filing requirements (the blanket orders) due to delays in the implementation of SEDAR+. The CSA now expects the launch date to be July 25, 2023, with a contingency date in September. In the meantime, due to the delay, market participants will continue to utilize SEDAR for their filings and other systems for their local filings, while noting: - Each CSA member is issuing a substantially similar [blanket order](https://www.securities-administrators.ca/news/csa-announces-exemptions-from-certain-filing-requirements-during-deferred-launch-of-sedar/?utm_medium=email&utm_campaign=MA_20230608_sedarexempt&utm_source=Envoke-General-Updates&utm_term=CSA-News-release-%2F-ACVM-Communiqu%C3%A9-de-presse#O13931) that will generally allow market participants to file on SEDAR or through other means until the beginning of the new cutover period, when neither SEDAR nor SEDAR+ will be available for filing. - The blanket orders will revoke the exemptions that were issued in connection with the originally planned June 2023 cutover, and CSA members will issue new blanket orders soon to address the new cutover period. - The new fee model, which reduces overall system fee costs by seven per cent, will still come into effect, as planned, on June 9, 2023, and will apply to all filings on SEDAR and the National Registration Database (NRD) until the beginning of the cutover period, as well as filings on SEDAR+ and the NRD after the launch date. - Filers will be able to pay system fees on SEDAR instead of SEDAR+. Details on [how to apply the new systems fee model in SEDAR](https://www.securities-administrators.ca/how-to-apply-the-new-flat-fee-model-in-sedar/) until the start of the cutover period can be found on the [SEDAR+ Launch page](https://www.securities-administrators.ca/about-sedar/sedar-transition/launch/) on the CSA website. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Announcement - July 13, 2023](https://baxsecuritieslaw.com/bax-announcement-july-13-2023/) **Published:** July 13, 2023 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law is pleased to announce that Barbara Hendrickson has been appointed to a second two year term with the BCSC Fintech Advisory Forum. The Forum is made up of financial technology (fintech) industry professionals and experts and advises BCSC staff on fintech trends... **Content:** BAX Securities Law is pleased to announce that Barbara Hendrickson has been appointed to a second two year term with the BCSC Fintech Advisory Forum. The Forum is made up of financial technology (fintech) industry professionals and experts and advises BCSC staff on fintech trends and developments, including opportunities and risks, and provide input on fintech issues in the securities industry and securities law issues affecting fintech. The Forum is chaired by the BCSC’s Fintech & Innovation Team (FIT), formerly known as the Tech Team. The Forum members will consider a number of issues facing the regulation of the Fintech industry including in the following areas: - distributed ledger technology (DLT)/blockchain (including crypto-assets and/or trading platforms); - artificial intelligence/machine learning (AI/ML); - investment services platforms (including crowdfunding platforms and online advisors); - data analytics and/or big data; - regulatory technology/supervisory technology; - systemic risk; - access to capital; - global fintech trends and developments; - innovator functions (such as incubators, research & development programs, labs/academics, and fintech industry groups); and - marketplaces/ exchanges developing blockchain clearing platforms and other large-scale fintech initiatives. The link to the notice is as follows: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Welcomes Developments Climate-Related Disclosure Requirements](https://baxsecuritieslaw.com/canadian-securities-regulators-welcomes-developments-climate-related-disclosure-requirements/) **Published:** July 21, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has welcomed two new developments in the field of Climate-Related Disclosure. The first, on June 26th, is the publication by the International Sustainability Standards Board (ISSB)’s first two sustainability disclosure standards: IFRS S1 General Requirements for Disclosure of Sustainability-related Financial... **Content:** The Canadian Securities Administrators (CSA) has welcomed two new developments in the field of Climate-Related Disclosure. The first, on June 26th, is the publication by the International Sustainability Standards Board (ISSB)’s first two sustainability disclosure standards: IFRS S1 *General Requirements for Disclosure of Sustainability-related Financial Information* and IFRS S2 *Climate- related Disclosures* (together, the ISSB Standards). The CSA is also encouraged by the ISSB’s proposed capacity building efforts to support adoption of the ISSB Standards. The regulator believes this may lead to a global framework for investor-focused disclosure that is responsive to market demand for more consistent and comparable disclosures. The second, is the announcement by the Canadian Sustainability Standards Board (CSSB), also on June 26 that it is now operational, having appointed a quorum of members. The CSA looks forward to engaging and collaborating with the CSSB with respect to the ISSB Standards. CSA members are responsible for developing climate-related disclosure requirements for reporting issuers in Canada. CSA staff intend to conduct further consultations to adopt disclosure standards based on ISSB Standards, with modifications considered necessary and appropriate in the Canadian context. A further market update from the CSA will follow in the coming months. IFRS S1 *General Requirements for Disclosure of Sustainability-related Financial Information* and IFRS S2 *Climate- related Disclosures can* [*be found on the website of the IFRS Foundation*](https://www.ifrs.org/issued-standards/ifrs-sustainability-standards-navigator/)*.* For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [The Standing Committee on Industry and Technology Issues Report on Blockchain](https://baxsecuritieslaw.com/the-standing-committee-on-industry-and-technology-issues-report-on-blockchain/) **Published:** July 21, 2023 **Author:** Barbara Hendrickson **Excerpt:** The House of Commons Standing Committee on Science and Technology has issued its report, Blockchain Technology: Cryptocurrencies and Beyond. The 62-page report examines the ways that blockchain technology is already changing the digital landscape and providing significant economic benefits, while also expressing optimism that greater... **Content:** The House of Commons Standing Committee on Science and Technology has issued its report, *Blockchain Technology: Cryptocurrencies and Beyond.* The 62-page report examines the ways that blockchain technology is already changing the digital landscape and providing significant economic benefits, while also expressing optimism that greater opportunities using the technology lie ahead. Over the course of five meetings, the Committee heard the testimony of 31 witnesses and received six briefs. The report laid out a total of 16 recommendations, chief among them was the adoption of a national blockchain and distributed ledger strategy. The recommendations also urged for the adoption of a distinct regulatory approach to stablecoins and regulatory changes to promote the establishment of federally regulated cryptocurrency custodians to meet the demand for cold storage services from Canadian cryptocurrency firms. The report of the House of Commons Standing Committee on Science and Technology, *Blockchain Technology: Cryptocurrencies and Beyond* is [available for download](https://www.ourcommons.ca/Content/Committee/441/INDU/Reports/RP12522346/indurp15/indurp15-e.pdf) from website of the House of Commons of Canada. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Outline Expectations for Investment Funds Holding Crypto Assets](https://baxsecuritieslaw.com/canadian-securities-regulators-outline-expectations-for-investment-funds-holding-crypto-assets/) **Published:** July 21, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published CSA Staff Notice 81-336 Guidance on Crypto Asset Investment Funds that are Reporting Issuers (the Staff Notice), which provides guidance to help fund managers understand and comply with securities law requirements for public investment funds holding crypto assets... **Content:** The Canadian Securities Administrators (CSA) has published CSA Staff Notice 81-336 *Guidance on Crypto Asset Investment Funds that are Reporting Issuers* (the Staff Notice), which provides guidance to help fund managers understand and comply with securities law requirements for public investment funds holding crypto assets (public crypto asset funds). The Staff Notice provides an overview of public crypto asset funds operating in Canada and describes related oversight initiatives by CSA members. The guidance also covers: - Market characteristics of crypto assets that could impact their viability as investments for public crypto asset funds; - Expectations concerning custody of crypto assets held on behalf of a fund; - Issues relating to yield-generating activities, like staking, by public crypto asset funds; and, - Know-your-client, know-your-product, and suitability obligations with respect to public crypto asset funds. CSA Staff Notice 81-336 *Guidance on Crypto Asset Investment Funds that are Reporting Issuers* [is available for download](https://www.securities-administrators.ca/news/canadian-securities-regulators-outline-expectations-for-investment-funds-holding-crypto-assets/) from the website of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Exempts Certain Filing Requirements During SEDAR+ Launch](https://baxsecuritieslaw.com/csa-exempts-certain-filing-requirements-during-sedar-launch-2/) **Published:** July 21, 2023 **Author:** Barbara Hendrickson **Excerpt:** Participating members of the Canadian Securities Administrators (CSA) will be issuing exemptions from certain filing requirements (the blanket orders) to cover the brief period before the System for Electronic Document Analysis and Retrieval (SEDAR) will be switched to a new centralized system, SEDAR+. The blanket... **Content:** Participating members of the Canadian Securities Administrators (CSA) will be issuing exemptions from certain filing requirements (the blanket orders) to cover the brief period before the System for Electronic Document Analysis and Retrieval (SEDAR) will be switched to a new centralized system, SEDAR+. The blanket orders (under Coordinated Blanket Order13-932) came into effect July 21, 2023, and will expire when SEDAR+ launches, which is now expected to be 7 am (Eastern time), July 25, 2023. Each CSA member will be issuing a substantially similar blanket order covering the period when neither SEDAR nor SEDAR+ will be available to receive documents. The exemptions available through the blanket orders provide an extension to file or deliver documents required to be transmitted through SEDAR+ during that time. The exemptions also provide filers with a means to transmit a document in exceptional circumstances where a filer chooses to file or deliver a document during this period. CSA Notice regarding Coordinated Blanket Order13-932 *Exemptions from certain filing requirements in connection with the launch of the System for Electronic Data Analysis and Retrieval* [is available for download](https://www.securities-administrators.ca/news/csa-announces-updated-exemptions-from-filing-requirements-during-switch-to-system-for-electronic-data-analysis-and-retrieval-sedar/?utm_medium=email&utm_campaign=MA_20230717_sedarplus&utm_source=Envoke-General-Updates&utm_term=CSA-News-release-%2F-ACVM-Communiqu%C3%A9-de-presse#N13932) from the website of the Canadian Securities Administrators*.* For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Initiates Review of Exchange-Traded Funds](https://baxsecuritieslaw.com/csa-initiates-review-of-exchange-traded-funds/) **Published:** August 15, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) is launching a review of exchange-traded funds (ETFs). ETFs are an increasingly popular investment vehicle, offering exposure to a variety of underlying assets and investment strategies, with intraday liquidity on the secondary market. According to CSA staff, ETFs comprise approximately... **Content:** The Canadian Securities Administrators (CSA) is launching a review of exchange-traded funds (ETFs). ETFs are an increasingly popular investment vehicle, offering exposure to a variety of underlying assets and investment strategies, with intraday liquidity on the secondary market. According to CSA staff, ETFs comprise approximately 15% of total publicly offered investment fund assets in Canada and are expected to continue to grow. CSA staff will assess whether the current regulations applicable to ETFs remain appropriate, focusing on the unique features of ETFs, such as the creation and redemption of ETF units by authorized dealers, trading on the secondary market, and the arbitrage mechanism that allows the ETF’s market price to remain close to the underlying value of its portfolio. The regulator’s analysis will also include a review of the secondary market activity and factors that may affect ETF liquidity and trading. It will also consider whether the Good Practices Relating to the Implementation of the IOSCO Principles for Exchange Traded Funds published by the International Organization of Securities Commissions in May 2023 are appropriate for the Canadian market. The information obtained from the CSA’s review of ETFs will help inform any future consultations or regulatory responses applicable to ETFs. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [The Standing Committee on Industry and Technology Issues Report on Blockchain](https://baxsecuritieslaw.com/the-standing-committee-on-industry-and-technology-issues-report-on-blockchain-2/) **Published:** August 15, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has published OSC Staff Notice 33-752 – Summary Report for Dealers, Advisers and Investment Fund Managers (The Summary Report). The Summary Report describes the work conducted by the OSC’s Compliance and Registrant Regulation Branch (CRR) during the 2020-2021 fiscal year... **Content:** The Ontario Securities Commission (OSC) has published *OSC Staff Notice 33-752 – Summary Report for Dealers, Advisers and Investment Fund Managers* (The Summary Report). The Summary Report describes the work conducted by the OSC’s Compliance and Registrant Regulation Branch (CRR) during the 2020-2021 fiscal year and discusses important matters impacting registration, outcomes from compliance reviews, recent conduct matters and other ongoing initiatives impacting registrants. Information provided in the Summary Report is meant to assist registrants with meeting their ongoing regulatory requirements. Firms are encouraged to use the Summary Report as a self-assessment tool to strengthen their systems of compliance, internal controls and supervision. The Summary Report is available as an interactive, downloadable PDF. The Summary Report will also be published in the OSC Bulletin August 19, 2021 *OSC Staff Notice 33-752 – Summary Report for Dealers, Advisers and Investment Fund Managers* [is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/3/33-755/osc-staff-notice-33-755-crr-branch-summary-report) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CIRO Publishing Proposed Clarifying Amendments to Registration and Proficiency for Review and Comment](https://baxsecuritieslaw.com/ciro-publishing-proposed-clarifying-amendments-to-registration-and-proficiency-for-review-and-comment/) **Published:** September 5, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Investment Regulatory Organization (CIRO), Canada’s national self-regulatory organization that oversees all investment dealers, mutual fund dealers and trading activity on Canada’s debt and equity marketplaces, is publishing for a comment (the Request for Comment) for a period ending October 2nd, 2023.  The Request... **Content:** The Canadian Investment Regulatory Organization ([CIRO)](https://www.ciro.ca/), Canada’s national self-regulatory organization that oversees all investment dealers, mutual fund dealers and trading activity on Canada’s debt and equity marketplaces, is publishing for a comment (the **Request for Comment**) for a period ending October 2nd, 2023. The Request for Comment will seek stakeholder input on proposed amendments to refine and clarify the registration and proficiency requirements in the Investment Dealer and Partially Consolidated Rules (the **Proposed Amendments**). CIRO is publishing the Proposed Amendments for comment to clarify differing views of the interpretation of the requirements impacted by the Proposed Amendments. Specifically, the Proposed Amendments: - refine the proficiency requirements in Rule 2600, - clarify redundant and ambiguous language in Rules 2500, 2600, 2700, and 3900, and - make consequential changes to cross-references and terminology arising from the foregoing changes. The [Request for Comment](https://www.osc.ca/sites/default/files/2023-08/ciro_20230831_rfc-proposed-clarifying-amendments.pdf) and [The Proposed Amendments](https://www.osc.ca/sites/default/files/2023-08/ciro_20230831_proposed-clarifying-amendments-rfc.pdf) are available for download from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Multilateral Staff Notice 45-309 (Revised) Guidance for Preparing and Filing an Offering Memorandum under National Instrument 45-106 Prospectus Exemptions](https://baxsecuritieslaw.com/multilateral-staff-notice-45-309-revised-guidance-for-preparing-and-filing-an-offering-memorandum-under-national-instrument-45-106-prospectus-exemptions/) **Published:** September 7, 2023 **Author:** Barbara Hendrickson **Excerpt:** Participating jurisdictions (except Ontario) of the Canadian Securities Administrators (the Participating Jurisdictions) are publishing Multilateral Staff Notice 45-309 (Revised) Guidance for Preparing and Filing an Offering Memorandum under National Instrument 45-106 Prospectus Exemptions (45-309, the Staff Notice) to provide guidance to issuers, underwriters, and their... **Content:** Participating jurisdictions (except Ontario) of the Canadian Securities Administrators (the Participating Jurisdictions) are publishing *Multilateral Staff Notice 45-309 (Revised) Guidance for Preparing and Filing an Offering Memorandum under National Instrument 45-106 Prospectus Exemptions* (45-309, the Staff Notice) to provide guidance to issuers, underwriters, and their advisors that intend to rely on section 2.9 (the OM Exemption) of National Instrument 45-106 Prospectus Exemptions (NI 45-106). The Staff Notice also summarizes common deficiencies CSA Staff have observed in offering memoranda (each an OM) prepared in accordance with Form 45-106F2 Offering Memorandum for Non-Qualifying Issuers (the F2) and discusses the potential consequences of non-compliance with the terms of the OM Exemption (the Requirements). The Staff Notice, which was published on March 8, 2023, replaces a prior version of the Staff Notice issued April 26, 2012. *Multilateral Staff Notice 45-309 (Revised) Guidance for Preparing and Filing an Offering Memorandum under National Instrument 45-106 Prospectus Exemptions* [is available for download](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-4/45309-Revised-Multilateral-CSA-Staff-Notice-March-8-2023.pdf?dt=20230306182904) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Propose Introduction Of Expedited Shelf Prospectus Regime For Certain Issuers](https://baxsecuritieslaw.com/canadian-securities-regulators-propose-introduction-of-expedited-shelf-prospectus-regime-for-certain-issuers/) **Published:** October 3, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) is seeking public comment for a 90-day period ending December 20, 2023, on a proposed expedited shelf prospectus regime for well-known seasoned issuers (WKSIs) in Canada (The Proposed Amendments). The Proposed Amendments are detailed in CSA Notice and Request for Comment... **Content:** The Canadian Securities Administrators (CSA) is seeking public comment for a 90-day period ending December 20, 2023, on a proposed expedited shelf prospectus regime for well-known seasoned issuers (WKSIs) in Canada (The Proposed Amendments). The Proposed Amendments are detailed in *CSA Notice and Request for Comment – Proposed Amendments to National Instrument 44-102 Shelf Distributions Relating to Well-known Seasoned Issuers***.** In addition to the proposed amendments to *National Instrument 44-10, Shelf Distributions*, changes are also proposed to *Companion Policy 44-102CP to NI 44-102*, and *National Policy 11-20, Process for Prospectus Reviews in Multiple Jurisdictions*. The Proposed Amendments would introduce an expedited shelf prospectus regime for WKSIs in Canada who have a strong market following, complete public disclosure record, and sufficient public equity. The intent is to reduce the regulatory burden on these issuers and make it easier for them to raise capital in the Canadian public markets. Issuers that satisfy the qualification criteria, with certain conditions, including a complete continuous disclosure record would be able to: - File a final base shelf prospectus and be deemed to have received a receipt for that prospectus without first filing a preliminary base shelf prospectus or undergoing any regulatory review. - Omit certain disclosure from the base shelf prospectus (for example, the aggregate dollar amount of securities that may be raised under the prospectus). - Benefit from receipt effectiveness for a period of 37 months from the date of its deemed issuance, subject to the issuer reassessing its qualification to use the WKSI regime annually. Interested stakeholders are invited to provide comments in writing before the comment period ends on December 20, 2023. During the comment period, there will be local outreach to various stakeholders to solicit feedback on the proposals and encourage written comments. *CSA Notice and Request for Comment – Proposed Amendments to National Instrument 44-102 Shelf Distributions Relating to Well-known Seasoned Issuers* [is available for download](https://www.osc.ca/sites/default/files/2023-09/csa_20230921_44-102_rfc-shelf-distributions.pdf) from the websites of CSA Members*.* For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Adopt Business Conduct Rule for Derivatives Dealers and Advisers](https://baxsecuritieslaw.com/canadian-securities-regulators-adopt-business-conduct-rule-for-derivatives-dealers-and-advisers/) **Published:** October 5, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Participating Jurisdictions of the Canadian Securities Administrators (CSA), Alberta, Saskatchewan, Manitoba, Ontario, Québec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Yukon, Nunavut and Northwest Territories (the Participating Jurisdictions) have published Multilateral Instrument 93-101 Derivatives: Business Conduct and its Companion Policy, Companion Policy... **Content:** The Participating Jurisdictions of the Canadian Securities Administrators (CSA), Alberta, Saskatchewan, Manitoba, Ontario, Québec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Yukon, Nunavut and Northwest Territories (the Participating Jurisdictions) have published Multilateral Instrument 93-101 *Derivatives: Business Conduct and its Companion Policy, Companion Policy 93-101 Derivatives: Business Conduct* (collectively, the Business Conduct Rule). The Business Conduct Rule will become effective September 28, 2024. The goal of the Business Conduct Rule is to establish a robust market conduct regime tailored for the Over the Counter (OTC) derivatives markets and meets the standards of the International Organization of Securities Commissions (IOSCO), and is harmonized both within Canada and with the regulatory approach taken by most IOSCO jurisdictions with active derivatives markets. The Business Conduct Rule is intended to help protect participants in the OTC derivatives markets from unfair, improper, or fraudulent practices and will foster confidence in the Canadian financial markets and promote transparency, accountability, and responsible business conduct in the OTC derivatives market. The Business Conduct Rule was developed over an extensive three-stage consultation process that included a public roundtable to consider various regulatory, implementation, and compliance matters. In response to comments received during the most recent consultation, the final rule was streamlined to address potential negative impacts on derivatives market liquidity and to reduce implementation burden by better enabling firms to leverage their existing compliance systems. Multilateral Instrument 93-101 *Derivatives: Business Conduct* is [available for download](https://www.osc.ca/sites/default/files/2023-09/csa_20230928_93-101_nop-derivatives.pdf) from the websites of participating CSA Jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Provide Update on Proposed Amendments to Continuous Disclosure Requirements](https://baxsecuritieslaw.com/canadian-securities-regulators-provide-update-on-proposed-amendments-to-continuous-disclosure-requirements/) **Published:** October 10, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has issued an update on proposed amendments to modernize the continuous disclosure requirements for non-investment fund reporting issuers published for comment in May 2021 (The Proposed Amendments). The Proposed Amendments would streamline and clarify certain disclosure requirements for the management’s... **Content:** The Canadian Securities Administrators (CSA) has issued an update on proposed amendments to modernize the continuous disclosure requirements for non-investment fund reporting issuers published for comment in May 2021 (The Proposed Amendments). The Proposed Amendments would streamline and clarify certain disclosure requirements for the management’s discussion and analysis (MD&A) and the annual information form (AIF). They would also combine interim and annual financial statements, MD&A, and, where applicable, the AIF into one reporting document for each reporting period (called the interim disclosure statement or annual disclosure statement, as applicable). Following the publication of the Proposed Amendments, the CSA published in April 2022 a proposed access model for prospectuses and certain continuous disclosure documents for non-investment fund reporting issuers (the Proposed Access Model). The Proposed Access Model was generally well received by commenters. Guided by their feedback, CSA staff are considering further ways to the improve the access model. The CSA anticipates publishing a revised access model for continuous disclosure. The regulator expects that the final access model would apply to the proposed annual and interim disclosure statements. Until that time, CSA staff do not anticipate implementing any amendments that would introduce the annual and interim disclosure statements. In deciding on the timing for implementing any of the continuous disclosure modernization proposals, the CSA staff advise they will ensure reporting issuers are provided with sufficient time to transition to any new forms and requirements. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Clarify Interim Approach to Stablecoins](https://baxsecuritieslaw.com/canadian-securities-regulators-clarify-interim-approach-to-stablecoins/) **Published:** October 10, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) is providing further guidance to crypto asset trading platforms based on its interim approach to the trading of value-referenced crypto assets or VCRAs (commonly referred to as stablecoins) as laid out in in CSA Staff Notice 21-333 Crypto Asset Trading... **Content:** The Canadian Securities Administrators (CSA) is providing further guidance to crypto asset trading platforms based on its interim approach to the trading of value-referenced crypto assets or **VCRAs** (commonly referred to as stablecoins) as laid out in in CSA Staff Notice 21-333 *Crypto Asset Trading Platforms: Terms and Conditions for Trading Value-Referenced Crypto Assets with Clients (The Staff Notice)*. In February 2023, the CSA confirmed its view that VCRAs, (commonly referred to as stablecoins) designed and promoted to maintain a stable value over time in relation to a reference asset, may constitute securities or derivatives. While Canadian law prohibits crypto asset trading platforms operating in Canada from trading crypto assets that are securities or derivatives, the regulator understands that stablecoins may have a use for the Canadian clients of crypto asset trading platforms. The CSA has indicated that it may allow, subject to terms and conditions, the continued trading of certain stablecoins that reference a given fiat currency. The regulator’s most recent notice sets out interim terms and conditions that would apply to crypto asset trading platforms and the issuers of fiat-backed crypto assets if they wish to continue allowing Canadian clients to purchase or deposit these assets. The interim terms and conditions were informed in part by comments from Canadian crypto market participants, as well as developing international standards and regulations. They are intended to address investor protection concerns presented by VCRAs and include, among other things, the following provisions: - The stablecoin issuer must maintain an appropriate reserve of assets with a qualified custodian, held for the benefit of the crypto asset holder; - The stablecoin issuer and crypto asset trading platforms that offer them must make certain information related to governance, operations/ and reserve of assets available to the public. The CSA cautions investors that stablecoins, including those referencing fiat currencies and satisfying the interim terms and conditions, are subject to various risks and are not the same as fiat currency. The regulator also cautions that because an asset may satisfy its interim terms and conditions, it does not mean the asset is risk-free or somehow endorsed or approved by the organization. The regulator welcomes submissions regarding the appropriate long-term regulation of stablecoins, such as alternative criteria for trading other types of VCRAs. Crypto asset trading platforms and VCRA issuers should contact their Principal Regulator with any questions or to discuss further. The complete list of terms and conditions, as well as instructions for crypto asset trading platforms that wish to continue allowing clients to buy or deposit VCRAs is available in ***CSA Staff Notice 21-333*,** *Crypto Asset Trading Platforms: Terms and Conditions for Trading Value-Referenced Crypto Assets with Clients*, which is [available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/2/21-332/csa-staff-notice-21-332-crypto-asset-trading-platforms-pre-registration-undertakings-changes) from CSA members’ websites. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Webinar Invite: The Regulation of Stablecoins in Canada](https://baxsecuritieslaw.com/webinar-invite-the-regulation-of-stablecoins-in-canada/) **Published:** October 13, 2023 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law webinar series on the regulation of crypto currencies in Canada Please join Barbara Hendrickson and Addison Cameron-Huff on November 3, 2023 at 12:00 PM EST for a webinar to discuss the evolving Canadian regulatory landscape for Value-Referenced Crypto Assets (VRCAs) commonly known as stablecoins.  Speakers... **Content:** BAX Securities Law webinar series on the regulation of crypto currencies in Canada **Please join Barbara Hendrickson and Addison Cameron-Huff** on November 3, 2023 at 12:00 PM EST for a webinar to discuss the evolving Canadian regulatory landscape for Value-Referenced Crypto Assets (VRCAs) commonly known as stablecoins. Speakers will address: - Recent regulatory guidance from the Canadian Securities Administrators (CSA): - CSA Staff Notice 21-*332 Crypto Asset Trading Platforms: Pre-registration Undertakings Changes to enhance Canadian Investor Protection* (February 22, 2023), - CSA Staff Notice 21-233 *Crypto Asset Trading Platforms: Terms and Conditions for Trading Value-Referenced Crypto Assets with Clients (October 5, 2023).* - Overview of the various kinds of stablecoins as well as their benefits and risks. - Registration requirements for trading stablecoins. - Implications for Money Service Businesses involving cryptocurrencies (FINTRAC) - Compliance considerations for crypto market participants. If you are currently involved in cryptocurrency activity in Canada or wish to enter the Canadian cryptocurrency market as a crypto trading platform or issuer of cryptocurrencies or otherwise please join us on November 3, 2023 Participants will have the opportunity to ask questions during the webinar. Please RSVP to **Categories:** News & Updates --- ### [CSA Publishes Staff Notice 31-364 - OBSI Joint Regulators Committee Annual Report for 2022](https://baxsecuritieslaw.com/csa-publishes-staff-notice-31-364-obsi-joint-regulators-committee-annual-report-for-2022/) **Published:** October 30, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Security Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have jointly published Staff Notice 31-364 - OBSI Joint Regulators Committee Annual Report for 2022 (The Staff Notice).   The Staff Notice serves as the Annual Report of the Joint Regulators Committee (JRC) of the Ombudsman... **Content:** The Canadian Security Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have jointly published *Staff Notice 31-364 – OBSI Joint Regulators Committee Annual Report for 2022* (The Staff Notice). The Staff Notice serves as the Annual Report of the Joint Regulators Committee (JRC) of the Ombudsman for Banking Services and Investments (OBSI). It provides an overview of the JRC and highlights the major activities conducted by the JRC in 2022. In 2022, the JRC continued to monitor data on investment-related complaints, including compensation refusals and settlements below OBSI’s recommendations, through the review of OBSI’s quarterly reporting. The JRC believes this data can sometimes provide risk- based indications of potential problems with a firm’s complaint handling practices or raise questions about whether a firm is participating in OBSI’s services in good faith or consistent with the applicable standard of care. While the JRC found no compensation refusals in 2022, the number of low settlements continued to cause concern. Since OBSI’s 2018 fiscal year, the regulator noted that clients received approximately $1.6 million less than it recommended. For OBSI’s fiscal years 2018 to 2022, out of 844 cases that ended with monetary compensation, 42 instances (approximately 5 per cent) involving 24 firms settled below OBSI recommendations. In the same five-year period, 10 of the 24 firms made settlements below OBSI’s recommended amount more than once. However, two of these firms made additional payments on three cases in 2021 to align compensation amounts with OBSI recommendations after follow-up by the CSA. The JRC recognizes the impact on complainants when firms refuse to compensate clients consistent with OBSI recommendations or settle for lower amounts than recommended by OBSI. The JRC continues to monitor low settlements and supports the ongoing work of the CSA to provide OBSI with the authority to make binding awards. The JRC is composed of designated representatives from the CSA and CIRO. In 2022, CSA-designated representatives were from British Columbia, Alberta, Ontario, and Quebec. In 2022, the JRC also included representatives from the two self-regulatory organizations (SROs) that amalgamated on January 1, 2023 and are predecessors to CIRO, the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA). ***CSA Staff Notice 31-364, OBSI Joint Regulators Committee Annual Report for 2022***, [is available for download](https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-3/31364-CSA-Staff-Notice-October-12-2023.pdf?dt=20231011171201) from CSA members’ websites. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian roundtable on audit quality addresses current state and emerging risks](https://baxsecuritieslaw.com/canadian-roundtable-on-audit-quality-addresses-current-state-and-emerging-risks/) **Published:** October 31, 2023 **Author:** Barbara Hendrickson **Excerpt:** On October 26th, the Canadian the Public Accountability Board (CPAB), the Office of the Superintendent of Financial Institutions (OSFI) and the Canadian Securities Administrators (CSA) co-hosted the Canadian Audit Quality Roundtable in Toronto. The annual Roundtable, brings together Canadian capital markets stakeholders, including regulators, standard-setters,... **Content:** On October 26th, the Canadian the Public Accountability Board (CPAB), the Office of the Superintendent of Financial Institutions (OSFI) and the Canadian Securities Administrators (CSA) co-hosted the Canadian Audit Quality Roundtable in Toronto. The annual Roundtable, brings together Canadian capital markets stakeholders, including regulators, standard-setters, and audit firms to share perspectives on the recent developments in audit quality in Canada. Now in its fifth year, the Roundtable provided a forum to discuss issues and priorities needed to support the integrity of financial reporting in Canada. Observations were also shared on the implementation of the Canadian Standard on Quality Management 1 (CSQM 1), the new Canadian auditing standard for quality management systems. Roundtable attendees discussed topics, including risks impacting external audits; the role of governance and culture within an audit firm, particularly with regards to audit quality; fraud detection and prevention; developments in sustainability and climate disclosure reporting standards and practices; risks related to emerging technologies, including AI (Artificial Intelligence); and IFRS 17 (International Financial Reporting Standard) Insurance Contracts implementation. Among the key points of discussion were: - An important element of maintaining confidence in Canada’s capital markets is the consistent execution of high-quality audits that maintaining confidence in audited financial statements of Canadian reporting issuers; - The fraud risk landscape continues to evolve. Many firms are implementing or piloting new approaches including the use of technology and the increased utilization of forensic specialists to address these evolving risks; - Audit firms have begun to consider and address climate-related risks in their audit risk assessments of financial statements. There are opportunities to evolve the depth and consistency of these assessments; - Increased use of emerging technologies have created new opportunities to enhance audit quality but conversely have introduced new risks; and, - A continuing shift in the risk environment may lead to increased risk in credit, liquidity and going concern issues. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Regulators Publish Summary of Short Selling Consultation](https://baxsecuritieslaw.com/regulators-publish-summary-of-short-selling-consultation/) **Published:** November 19, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have published a summary of responses and comments to CSA/IIROC Staff Notice 23-329 Short Selling in Canada (The Joint Staff Notice). In December 2022, the CSA and the Investment Industry Regulatory Organization of... **Content:** The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have published a summary of responses and comments to [CSA/IIROC Staff Notice 23-329 *Short Selling in Canada*](https://www.osc.ca/en/securities-law/instruments-rules-policies/2/23-329/joint-csa-and-iiroc-staff-notice-23-329-short-selling-canada) (The Joint Staff Notice)*.* In December 2022, the CSA and the Investment Industry Regulatory Organization of Canada (CIRO’s predecessor) published the Joint Staff Notice to seek input on the current regulatory framework surrounding short selling in Canada. The regulators received 23 comment letters from a wide range of stakeholders, including industry associations, exchanges, dealers, issuers, and investors. The notice summarizes these comment letters and identifies potential areas for further study by the CSA and CIRO. The Comment letters [are available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/2/23-315/csaiiroc-joint-notic) from the websites of the Ontario Securities Commission (OSC), Autorité des marchés financiers (AMF), and CIRO. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Propose Binding Regime For Investment-Related Disputes](https://baxsecuritieslaw.com/canadian-securities-regulators-propose-binding-regime-for-investment-related-disputes/) **Published:** December 8, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published proposed amendments to National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) (the Proposed Amendments) as well as proposed changes to Companion Policy 31-103CP Registration Requirements, Exemptions and Ongoing Registrant Obligations (31-103CP) (the Proposed Changes)... **Content:** The Canadian Securities Administrators (CSA) has published proposed amendments to *National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103)* (the Proposed Amendments) as well as proposed changes to *Companion Policy 31-103CP Registration Requirements, Exemptions and Ongoing Registrant Obligations (31-103CP*) (the Proposed Changes) for a 90-day comment period ending February 28, 2024. The Proposed Changes and Proposed Amendments set out a new regulatory framework (the Proposed Framework) under which a not-for-profit independent dispute resolution service (IDRS) has been designated or recognized by CSA jurisdictions and would have the authority to issue decisions that would be both final and binding. Currently, under NI 31-103, the Ombudsman for Banking Services and Investments (OBSI) acts as an independent service tasked with dispute resolution; however, the OBSI lacks the authority to make binding decisions. If implemented, The Proposed Amendments would modify the complaint-handling process and require that firms comply with a final decision of the IDRS. The British Columbia Securities Commission (BCSC) supports the outcomes intended by this project but is not participating in the proposal for comment on the rule amendments. British Columbia is considering legislative changes that may achieve the same outcomes as those intended by the proposed framework. The proposed amendments to *National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103)* and the proposed changes to *Companion Policy 31-103CP Registration Requirements, Exemptions and Ongoing Registrant Obligations (31-103CP*) [are available for download](https://www.osc.ca/sites/default/files/2023-11/csa_20231130_31-103_proposed-amendments.pdf) from websites of participating CSA jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Publish 2023 Systemic Risk Survey](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-2023-systemic-risk-survey/) **Published:** December 12, 2023 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published the results of its 2023 Systemic Risk Survey (the Survey). This annual Survey, first conducted in 2022, provides the CSA with important information on market participants’ concerns about the stability of the Canadian financial system. The 2023 Survey was conducted... **Content:** The Canadian Securities Administrators (CSA) has published the results of its *2023 Systemic Risk Survey* (the Survey). This annual Survey, first conducted in 2022, provides the CSA with important information on market participants’ concerns about the stability of the Canadian financial system. The 2023 Survey was conducted between October 16 and November 7, 2023. The Survey received responses from 489 Canadian portfolio managers and investment dealers. Overall, respondents reported that their concerns were somewhat more heightened over the previous year. Main concerns included the high level or Canadian household debt, high interest rates, the housing market, the geopolitical environment, and cyber vulnerabilities. Approximately 65% of respondents reported they were somewhat to very concerned about the stability of the Canadian financial system. This represented increase of about three per cent from a year ago. Over 75% of respondents felt that household debt posed a high or very high risk to Canadian financial stability. The *2023-2023 CSA Systemic Risk Survey* **[is available for download](https://www.securities-administrators.ca/resources/csa-surveys/2023-csa-systemic-risk-survey/)** from the website of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [SEC Approves Spot Bitcoin Exchange-Traded Products](https://baxsecuritieslaw.com/sec-approves-spot-bitcoin-exchange-traded-products/) **Published:** January 22, 2024 **Author:** Barbara Hendrickson **Excerpt:** Much media attention has been paid to the recent approval by the United States Securities and Exchange Commission (SEC) to allow the trading and listing of certain of spot bitcoin exchange-traded products (ETPs).   The SEC’s hand was forced by the decision of the U.S. Nineth... **Content:** Much media attention has been paid to the recent approval by the United States Securities and Exchange Commission (SEC) to allow the trading and listing of certain of spot bitcoin exchange-traded products (ETPs). The SEC’s hand was forced by the decision of the U.S. Nineth Circuit Court, which ruled last week that the SEC failed to adequately explain its decision in not approving the listing of Grayscale’s proposed ETP (The Grayscale Order). Faced with the Grayscale Order, SEC Chair Gary Gensler opted to [“take the most sustainable path forward”](https://www.sec.gov/news/statement/gensler-statement-spot-bitcoin-011023) and approved the Grayscale application for the listing of the ETPs. At the same time the SEC [also approved ten additional spot bitcoin ETPs for listing and trading](https://news.bitcoin.com/sec-chair-gary-gensler-was-the-deciding-vote-approving-spot-bitcoin-etfs/). Gensler has expressed caution in the SEC decision, restating his reservations with bitcoin, noting it is “primarily a speculative, volatile asset that’s also used for illicit activity including ransomware, money laundering, sanction evasion, and terrorist financing.” Gensler has also indicated that the approval of the 11 listings does not signal the SEC’s willingness to approve listing standards for crypto asset securities: “Nor does the approval signal,” wrote Gensler, “anything about the Commission’s views as to the status of other crypto assets under the federal securities laws or about the current state of non-compliance of certain crypto asset market participants with the federal securities laws,” signalling a continued hard-line approach towards crypto assets. He warned sponsors of bitcoin ETPs that they would be required to provide “full, fair, and truthful disclosure” about their products. He also indicated the that the SEC will investigate any sign of fraud or manipulation in the markets, especially those using social media platforms. You can read the complete statement by SEC Chair Gensler [here](https://www.sec.gov/news/statement/gensler-statement-spot-bitcoin-011023). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [The Financial Services Regulatory Authority Of Ontario Approves Canadian Investment Regulatory Organization As Credentialling Body](https://baxsecuritieslaw.com/the-financial-services-regulatory-authority-of-ontario-approves-canadian-investment-regulatory-organization-as-credentialling-body/) **Published:** January 30, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Financial Services Regulatory Authority of Ontario (FSRA) has approved the Canadian Investment Regulatory Organization (CIRO) as a credentialing body under Ontario's Financial Professionals Title Protection Act, 2019 (FPTPA)  The approval by FSRA means CIRO now has the authority to grant credentials that permit individuals to use... **Content:** The Financial Services Regulatory Authority of Ontario (FSRA) has approved the Canadian Investment Regulatory Organization (CIRO) as a credentialing body under Ontario’s [*Financial Professionals Title Protection Act, 2019 (FPTPA)* ](https://www.ontario.ca/laws/statute/19f07b?search=Financial%20Professionals%20Title%20Protection%20Act) The approval by FSRA means CIRO now has the authority to grant credentials that permit individuals to use the Financial Advisor title in Ontario. The categories of individuals approved by CIRO, that may use the Financial Advisor title are: - Registered Representative; - Mutual Fund Dealing Representative; - Portfolio Manager; and, - Associate Portfolio Manager. With the implementation of the FPTPA, usage of the titles “Financial Advisor” and “Financial Planner” is now restricted to professionals who meet or exceed minimum proficiency and continuing education thresholds and who are subject to a code of conduct that requires that they put the interests of clients first. According to CIRO, this professional title protection, which is a first in Ontario, will result in enhanced consumer protection and foster a more sustainable, competitive financial services sector. CIRO, which launched in January 2023, is a consolidation of the former Investment Industry Regulatory Organization of Canada (IIROC) and the former Mutual Fund Dealers Association of Canada (MFDA), with a mandate to protect investors and support healthy Canadian capital markets. Becoming a credentialing body under FSRA’s title protection framework will support this focus on enhanced investor protection. FSRA-approved credentialing bodies are responsible for overseeing the conduct of their Financial Planner and Financial Advisor credential holders and enforcing compliance with minimum requirements. Credentialing bodies must have robust supervision processes and a code of conduct. To help ensure the Financial Professionals Title Protection Framework (the Framework) is working as it should, FSRA has committed to reviewing the framework by the end of the fiscal year (March 31, 2024). This review will evaluate the Framework’s effectiveness in achieving expected outcomes and assess opportunities for improvement, including consultation with key stakeholders as necessary. As part of this review, FSRA will look at the proficiency standards for the Financial Planner and Financial Advisor titles to ensure they remain relevant and aligned with what consumers expect from title users. The review will also include an evaluation of credentialing body policies and processes, including complaint handling and disciplinary practices. FSRA maintains a list of approved credentialing bodies on its [website ](https://www.fsrao.ca/industry/financial-planners-and-financial-advisors/approved-credentialing-bodies-and-credentials?utm_source=mc&utm_medium=email&utm_campaign=FPFA_Jun23). The regulator plans to launch a registry of credentialed Financial Planners and Advisors in Ontario early in 2024. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson Contributor to Lexis Nexis - Practical Guidance Canada](https://baxsecuritieslaw.com/barbara-hendrickson-contributor-to-lexis-nexis-practical-guidance-canada/) **Published:** January 31, 2024 **Author:** Barbara Hendrickson **Excerpt:** Barbara  Hendrickson is the author of recent practice note entitled “Underwriting Conflicts” which appears in Lexis Nexis Practical Guidance Canada. This practice note provides an introduction to Canadian securities law with respect to underwriter's conflicts as set out in National Instrument 33-105 Underwriter's Conflicts ("NI... **Content:** Barbara Hendrickson is the author of recent practice note entitled “Underwriting Conflicts” which appears in Lexis Nexis *Practical Guidance Canada*. This practice note provides an introduction to Canadian securities law with respect to underwriter’s conflicts as set out in National Instrument 33-105 Underwriter’s Conflicts (“NI 33-105”). NI 33-105 is in effect in all 13 Canadian provinces and territories. NI 33-105 and its companion policy (“CP to NI 33-105”) provides a principles-based framework that requires securities registrants to identify and respond to material conflicts of interest. **[The practice note can be found at here.](https://advance.lexis.com/open/document/lpadocument/?pdmfid=1518425&crid=f66b7c41-f57c-4ef7-b960-7c0f65b084f5&pddocfullpath=%2Fshared%2Fdocument%2Fanalytical-materials-lpa-ca%2Furn%3AcontentItem%3A6B5S-0HF3-RRKK-245P-00000-00&pdcontentcomponentid=402959&pdteaserkey=sr10&pdcatfilters=UHJhY3RpY2VBcmVhXnVybjp0b3BpYzo3MDVDNzc4MDI0MTc0OTYzOEZFNTkzMTAyNTc4RUE5MnxUYXNrXnVybjp0b3BpYzpGRUI0QkQ4QjNCREE0MjU0QTQwQ0ZGRjk0RUM1MzUzQw&config=00JAA1MWY4NDc0NC1iODBkLTRhMTUtYTgwNS0zZmE1NmQ2ODBkN2UKAFBvZENhdGFsb2fkxnLzoq43TU0z2GuoU60x&pditab=allpods&ecomp=5pzhkkk&earg=sr10&prid=ed29fbf4-700c-45d0-a45e-8fc80df67ccf)** For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law announces resumption of Toronto Business Lawyers Association Monthly Meetings](https://baxsecuritieslaw.com/bax-securities-law-announces-resumption-of-toronto-business-lawyers-association-monthly-meetings/) **Published:** February 13, 2024 **Author:** Barbara Hendrickson **Excerpt:** Toronto, February 12, 2024: BAX Securities Law is pleased to announce that the firm will resume its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings. Barbara Hendrickson, Managing Partner of BAX Securities Law, commented, "We are excited to resume... **Content:** **Toronto, February 12, 2024: BAX Securities Law is pleased to announce that the firm will resume its sponsorship of the** Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings. Barbara Hendrickson, Managing Partner of BAX Securities Law, commented, “We are excited to resume the TBLA monthly networking meetings which were suspended during the COVID pandemic. The need for lawyers in small and mid-sized law firm to grow their referral network is more important now than ever and BAX is pleased to support its friends and colleagues in winning new business and increasing their client base.” The Toronto Business Lawyers Association was created by Barbara Hendrickson over eight years ago when she realized that there was a need for business lawyers in the small and mid-size law firm community to have a forum in downtown Toronto to get together regularly for business and professional development purposes. The TBLA meetings are held once a month (the third Thursday of each month) at 8:30 AM at Chefs Hall 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services, etc… The next monthly meeting is at 8:30 AM March 21, 2024, at Chef’s Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – info@baxsecuritieslaw.com. For more information on the TBLA and its events please visit [torontobusinesslawyersassociation.org](https://torontobusinesslawyers.org/) or contact Barbara at . **Categories:** News & Updates --- ### [Regulators Report on Systemic Market Risk in 2023](https://baxsecuritieslaw.com/regulators-report-on-systemic-market-risk-in-2023/) **Published:** February 16, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published its 2023 review of systemic market risk in the Canadian capital markets, The 2023 Annual Report on Capital Markets (the Report). The Report is the regulator's analysis of recent financial market trends and key vulnerabilities in Canadian capital markets. Overall,... **Content:** The Canadian Securities Administrators (CSA) has published its 2023 review of systemic market risk in the Canadian capital markets, *The 2023 Annual Report on Capital Markets* (the Report). The Report is the regulator’s analysis of recent financial market trends and key vulnerabilities in Canadian capital markets. Overall, the CSA believes the risks to financial stability in Canadian capital markets are well contained. Key take-aways include: - Bond market: The higher rate environment has not adversely impacted bond trading activity, notes the regulator. Bond turnover and other key liquidity metrics remained within normal ranges. However, the CSA reports the overall credit quality profile of Canadian non-financial corporate bonds declined somewhat. - Crypto assets: The CSA observes that crypto asset market remains volatile and unstable. However, the regulator notes links between the crypto asset and traditional financial sectors appear limited. - Dealers: The CSA says that the failure of a large dealer could have broad repercussions due to a high degree of connectivity between large dealers and other market participants. However, the regulator notes that “appropriate measures to prevent failures” are in place and leverage levels remain relatively low. - Investment funds: On the whole, the regulator reports that fund liquidity risks are low and well managed. However, it notes that exempt funds investing in private assets – such as private debt, private equity, and private real estate – have reported liquidity mismatches and these pressures might increase should the economic climate deteriorate. The good news, the CSA notes, is that exchange-traded funds have demonstrated resilience during what the regulator termed as “recent episodes of economic stress.” *The 2023 Annual Report on Capital Markets* is [available for download](https://www.securities-administrators.ca/wp-content/uploads/2024/02/SRC-2023-Annual-Report_Final.pdf) from the website of the Canadian Securities Administrators. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Update Guidance On Virtual Shareholder Meetings](https://baxsecuritieslaw.com/canadian-securities-regulators-update-guidance-on-virtual-shareholder-meetings/) **Published:** February 26, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have provided updated guidance on virtual shareholder meetings. During the pandemic, virtual shareholder meetings became necessary due to quarantine restrictions. In the period following the pandemic, the practice has continued, with the amending of certain Canadian corporate statutes that govern... **Content:** The Canadian Securities Administrators (CSA) have provided updated guidance on virtual shareholder meetings. During the pandemic, virtual shareholder meetings became necessary due to quarantine restrictions. In the period following the pandemic, the practice has continued, with the amending of certain Canadian corporate statutes that govern the conduct of shareholder meetings and the reporting issuer’s organizing documents to permit virtual shareholder meetings and include requirements reporting issuers must meet when conducting virtual meetings. However, the CSA has noted that some stakeholders have expressed concerns, based on their experience participating in virtual-only shareholder meetings, that these meetings present challenges for shareholders wishing to exercise their rights and express themselves to management. Other stakeholders have related difficulties accessing and participating in the virtual meetings. Based on these concerns, the regulator has issued updated guidance to assist reporting issuers in fulfilling their obligations under securities legislation and to encourage the adoption of practices that facilitate shareholder participation. These include: - *Disclosure to shareholders on how to access and participate at virtual meetings:* In order for reporting issuers to fulfill their obligations under securities legislation, it is important that reporting issuers provide clear and comprehensive disclosure in management information circulars and associated proxy-related materials with respect to the logistics for accessing, participating and voting at a virtual meeting. - *Facilitating shareholder participation at virtual meetings:* For many investors, retail investors in particular, the annual meeting has traditionally represented the only opportunity for meaningful engagement with management. The ability to attend and participate in a shareholder meeting should not require anything more than a basic level of technological proficiency. The CSA is encouraging reporting issuers to provide for a level of ease and quality of shareholder participation at a virtual meeting comparable to what a shareholder could reasonably expect if attending an in-person meeting. This is only a summary. The complete updated guidance for virtual shareholders meetings [are available for download](https://www.securities-administrators.ca/news/canadian-securities-regulators-provide-updated-guidance-on-virtual-shareholder-meetings-2/) on the website of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [The Retail Payments Activities Act – Bank Of Canada Guidance On The Criteria For Registering Payment Service Providers](https://baxsecuritieslaw.com/the-retail-payments-activities-act-bank-of-canada-guidance-on-the-criteria-for-registering-payment-service-providers/) **Published:** February 27, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Retail Payments Activities Act was enacted by the Parliament of Canada and passed into law, on June 29, 2021, with regulations published on November 22, 2023.  On December 12, 2023, the Bank of Canada published guidance entitled Criteria for registering payment service providers (Guidance).... **Content:** The *Retail Payments Activities Act* was enacted by the Parliament of Canada and passed into law, on June 29, 2021, with regulations published on November 22, 2023. On December 12, 2023, the Bank of Canada published guidance entitled *Criteria for registering payment service providers* (Guidance). Under the *Retail Payments Activities Act*, the Bank of Canada is responsible for the supervision of retail payment service providers (payment service providers) for compliance with the *Retail Payments Activities Act*. The Guidance is designed to assist potential payment service providers in assessing whether an activity falls under the Retail *Payments Activities Act* and determining whether they should submit an application for registration. The *Retail Payments Activities Act*’s regulatory framework directs the activities of payment service providers through the Bank of Canada. The Bank of Canada supervises payment service providers such as card networks, payment processors and digital wallets that perform electronic payment functions. Under the *Retail Payments Activities Act*, payment service providers now have to register with the Bank of Canada to operate in Canada. Regulations under the *Retail Payments Activities Act* require payment service providers to have measures in place to safeguard end-users’ funds and mitigate operational risks that could disrupt or compromise their services. Regulations under the *Retail Payments Activities Act* would also include national security safeguards. Payment service providers must register with the Bank of Canada before it performs any retail payment activities if all four of the following conditions are met: ### 1. The payment service providers perform a payment function rThe payment service provider performs one or more of the five payment functions identified in the Retail Payments Activities Act as a service that is not incidental to any non-payment service or business activity. The Act defines five payment functions: - provision or maintenance of an account that is held on behalf of one end user or more; - holding funds on behalf of an end user; - initiation of an electronic funds transfer at the request of an end user; - authorization of an electronic funds transfer or transmission, reception or facilitation of an instruction in relation to an electronic funds transfer; and - provision of clearing or settlement services. ### 2. The payment service providers perform a payment function related to an electronic funds transfer (EFT) that is made in a fiat currency or a prescribed unit. ### 3. The payment service providers fall under the geographic scope of the *Retail* *Payments Activities Act* which requires: - a place of business in Canada, or, - the provision of direct services at, and perform services for, individuals or entities in Canada. ### 4. The *Retail Payments Activities Act* excludes certain individuals or entities and activities from its application, including but not limited to: - banks, authorized foreign banks, and provincially-regulated trust companies; - incidental activities, securities related transactions, and internal and closed loop transactions; - transactions related to securities performed by individuals or entities that are regulated or exempted from regulation under securities legislation; and - holding funds. The Bank of Canada Guidance [is available for download](https://www.bankofcanada.ca/core-functions/retail-payments-supervision/retail-payments-supervision-supervisory-policies-and-guidelines/criteria-for-registering-payment-service-providers/) from the website of the Bank of Canada. *The Retail Payments Activities Act* [ is available for download](https://laws-lois.justice.gc.ca/eng/acts/R-7.36/page-1.html) from the website of the Government of Canada. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Bank of Canada Launches Retail Payment Activities Act Supervisory Guidelines Consultation](https://baxsecuritieslaw.com/bank-of-canada-launches-retail-payment-activities-act-supervisory-guidelines-consultation/) **Published:** February 29, 2024 **Author:** Barbara Hendrickson **Excerpt:** Under the Retail Payment Activities Act, payment service providers registered with the Bank of Canada must demonstrate how they manage their operational risks, respond to incidents, safeguard end-user funds, and notify the Bank of Canada of certain incidents and significant changes. This requirement comes into... **Content:** Under the *Retail Payment Activities Act*, payment service providers registered with the Bank of Canada must demonstrate how they manage their operational risks, respond to incidents, safeguard end-user funds, and notify the Bank of Canada of certain incidents and significant changes. This requirement comes into effect on September 8, 2025. The Bank of Canada has drafted new supervisory guidelines (Guidelines) to help payment service providers understand their obligations and is inviting stakeholders to comment on them. The Bank of Canada is especially interested in feedback on aspects of the Guidelines that could either be clarified or challenging to implement. The deadline for comments is May 21, 2024. The guidelines are: - *Operational risk and incident response*: This supervisory guideline is intended to help payment service providers that are subject to the *Retail Payment Activities Act* meet their obligations related to operational risk management and incident response. - *Incident notification:* This supervisory guideline explains the requirements on incident reporting under the *Retail Payment Activities Act* and provides clarity, when appropriate, on how the Bank expects payment service providers to comply with those regulatory requirements. - *Safeguarding end-user funds:* This supervisory guideline is intended to help payment service providers that are subject to the Retail Payment Activities Act meet their obligations related to safeguarding end-user funds. - *Notice of significant change or new activity*: Under the *Retail Payment Activities Act,* payment service providers are required to notify the Bank before they make a significant change to the way they perform their retail payment activities or before they perform a new retail payment activity. The new supervisory guidelines are [available for download and review](https://www.bankofcanada.ca/core-functions/retail-payments-supervision/retail-payments-supervision-consultation/) from the website of the Bank of Canada. *The Retail Payments Activities Act* [ is available for download](https://laws-lois.justice.gc.ca/eng/acts/R-7.36/page-1.html) from the website of the Government of Canada. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators Publish Updated Guidance On ESG-Related Fund Disclosure](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-updated-guidance-on-esg-related-fund-disclosure/) **Published:** March 12, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published CSA Staff Notice 81-334 - ESG-Related Investment Fund Disclosure (Revised) (the revised Staff Notice), which provides updated guidance for investment funds on disclosure practices related to environmental, social and governance (ESG) matters. The revised CSA Staff Notice does... **Content:** The Canadian Securities Administrators (CSA) has published *CSA Staff Notice 81-334 – ESG-Related Investment Fund Disclosure (Revised)* (the revised Staff Notice), which provides updated guidance for investment funds on disclosure practices related to environmental, social and governance (ESG) matters. The revised CSA Staff Notice does not change [the guidance first published in January 2022](http://baxsecuritieslaw.com/canadian-securities-administrators-publish-csa-staff-notice-81-334-esg-related-investment-fund-disclosure/); it provides an update, discussing matters not covered in the original notice and reflects developments and issues that have arisen since. The revised CSA Staff Notice also includes guidance addressing different levels of disclosure expectations for funds whose investment objectives do not reference ESG factors but use ESG strategies. Generally, the level of disclosure is based on the level of ESG factors involved in a fund’s investment process. While remaining based on existing regulatory requirements, the revised CSA Staff Notice addresses various areas of disclosure, including investment objectives, fund names, investment strategies, risk disclosure, continuous disclosure, and sales communications. It covers the types of investment funds that may market themselves as focusing on ESG or considering ESG factors as part of their investment process. The revised CSA Staff Notice also summarizes the results from the ESG-focused reviews of prospectuses, sales communications, and continuous disclosure that have been conducted by CSA staff since the original January 2022 publication. *CSA Staff Notice 81-334 – ESG-Related Investment Fund Disclosure (Revised)* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/8/81-334) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Sustainability Standards Board Announces First Canadian Sustainability Disclosure Standards for Public Consultation](https://baxsecuritieslaw.com/canadian-sustainability-standards-board-announces-first-canadian-sustainability-disclosure-standards-for-public-consultation/) **Published:** March 20, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Sustainability Standards Board (CSSB) has published draft versions of the First Canadian Sustainability Disclosure Standards (the standards) for a 90-day comment period ending June 10, 2024.  The standards aim to set a new benchmark for sustainability-related information disclosure, facilitating a more consistent and... **Content:** The Canadian Sustainability Standards Board (CSSB) has published draft versions of the First Canadian Sustainability Disclosure Standards (the standards) for a 90-day comment period ending June 10, 2024. The standards aim to set a new benchmark for sustainability-related information disclosure, facilitating a more consistent and comparable approach. The CSSB is developing sustainability disclosure standards in Canada that acknowledge Canadian needs and interests and are aligned with global baseline standards developed by the International Sustainability Standards Board (ISSB). In June 2023, [the ISSB issued its first standards](https://baxsecuritieslaw.com/canadian-securities-regulators-welcomes-developments-climate-related-disclosure-requirements/) – IFRS S1, *General Requirements for Disclosure of Sustainability-related Financial Information* and IFRS S2, *Climate-related Disclosures*. Once the consultation is complete and its standards are finalized, the Canadian Securities Administrators (CSA) will incorporate them into a proposed rule, setting out climate-related disclosure requirements, which the regulator will publish for review and comment. The CSA proposal will consider the final CSSB standards and may include modifications appropriate for the Canadian capital markets. The CSA anticipates adopting only those provisions of the sustainability standards that are necessary to support climate-related disclosures. The draft version of the *First Canadian Sustainability Disclosure Standards* is available for download from the website of the Canadian Sustainability Standards Board. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Multilateral Continuous Disclosure Review And Guidance For Independent Review Committees Is Published](https://baxsecuritieslaw.com/multilateral-continuous-disclosure-review-and-guidance-for-independent-review-committees-is-published/) **Published:** March 25, 2024 **Author:** Barbara Hendrickson **Excerpt:** Canadian Securities Administrators (CSA) A Multilateral Staff Notice 81-337 Targeted Continuous Disclosure Review and Guidance for Independent Review Committees for Investment Funds (the Staff Notice) has been published jointly by the Ontario Securities Commission (OSC) and the Autorité des marchés financiers (AMF).  Publication of the... **Content:** Canadian Securities Administrators (CSA*) A Multilateral Staff Notice 81-337 Targeted Continuous Disclosure Review and Guidance for Independent Review Committees for Investment Funds* (the Staff Notice) has been published jointly by the Ontario Securities Commission (OSC) and the Autorité des marchés financiers (AMF). Publication of the Staff Notice follows a continuous disclosure review (the CD Review) related to National Instrument 81-107 *Independent Review Committee for Investment Funds* (NI 81-107 or the Rule) carried out jointly by both regulators. The CD Review included investment funds managed by 24 Investment Fund Managers (IFMs) who are principally under the regulatory auspices of the OSC or the AMF. Investment funds managed by the IFMs included conventional mutual funds, exchange-traded funds, scholarship plans and alternative funds to reflect a fair representation of fund types and sizes. The Staff Notice includes regulatory views on Independent Review Committee (**IRC)** Authority. It summarizes the findings and general observations in specific areas of inquiry and provides regulatory views and guidance on each area of inquiry. Staff reviewed prospectuses (long form or simplified prospectus as applicable to the fund), annual information forms (AIF), the Independent Review Committee (IRC) Report to Securityholders, and the websites of the IFM or funds as applicable. The Review found concerns with IRC term lengths, noting that several with members of terms longer than six years, which is considered the maximum. A shorter IRC term, except in limited circumstances, will help maintain fresh perspectives among the members, especially on conflicts of interest. The Review encourages IFMs to take a broad view of what constitutes a ‘conflict of interest matter’ and to err on the side of caution to refer an actual or perceived conflict of interest to the IRC. The Review also notes that diversity in IRC membership beyond a defined ‘skill set’ may lead to better decision-making and good governance. IFMs and IRCs are encouraged to use the guidance provided in this Notice to further enhance and support their roles under National Instrument 81-107 *Independent Review Committee for Investment Fund.* *CSA Multilateral Staff Notice 81-337 Targeted Continuous Disclosure Review and Guidance for Independent Review Committees for Investment Funds* [ is available for download](//www.osc.ca/en/securities-law/instruments-rules-policies/8/81-337/csa-multilateral-staff-notice-81-337-targeted-continuous-disclosure-review-and-guidance) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Investor Alert: Emergence of Claims Management Companies](https://baxsecuritieslaw.com/csa-investor-alert-emergence-of-claims-management-companies/) **Published:** March 26, 2024 **Author:** Barbara Hendrickson **Excerpt:** [et_pb_section admin_label="section"] [et_pb_row admin_label="row"] [et_pb_column type="4_4"][et_pb_text admin_label="Text"] A recent Canadian Securities Administrators (CSA) Investor Alert (Alert) points to the emergence of firms, known as claims management companies (CMCs) that offer paid services to investors to interreact with the Ontario Securities Commission and other member of... **Content:** [et_pb_section admin_label=”section”] [et_pb_row admin_label=”row”] [et_pb_column type=”4_4″][et_pb_text admin_label=”Text”] A recent Canadian Securities Administrators (CSA) Investor Alert (Alert) points to the emergence of firms, known as claims management companies (CMCs) that offer paid services to investors to interreact with the Ontario Securities Commission and other member of the CSA, the Canadian Investment Regulatory Organization (CIRO), and the Ombudsman for Banking Services and Investments (OBSI) related to claims or complaints free of charge. The Investor Alert emphasizes that it is not necessary for investors to pay a fee to a CMC, to interact with a regulator or oversight organization in a claim or complaint process, as the Ontario Securities Commission, CSA, CIRO and OBSI offers these services to investors free of charge. Some CMCs claim to be able to recover funds lost in cryptocurrency or other investments, through filing a claim or complaint with a regulator or oversight organization when in many cases this is not possible. The Investor Alert cautions that the unregulated CMCs in some cases: - provide services that are not necessary or are of value; - overcharge for services that otherwise can be had at no cost; - make overly optimistic predictions of recovery, particularly regarding cryptocurrency frauds; - inaccurately describes the role of a regulator or oversight organization by indicating the primary purpose of the regulator or oversight organization is the recovery of lost funds, when it is not; - prepares basic documentation for the CSA, OBSI or CIRO on behalf of an investor that does not provide sufficient information to investigate or understand the alleged fraud; and - asks an investor to hide the CMC’s involvement in a claim or complaint from the regulator they are interacting with. The Investor Alert can be found [on the website of the Canadian Securities Administrators.](https://www.securities-administrators.ca/news/investor-alert-investors-are-not-required-to-use-claims-management-companies-to-communicate-with-the-csa-ciro-or-obsi/#:~:text=Investors%20and%20consumers%20are%20not,manage%20their%20claim%20or%20complaint) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. [/et_pb_text][/et_pb_column] [/et_pb_row] [/et_pb_section] [previousMultilateral Continuous Disclosure Review And Guidance For Independent Review Committees Is Published](https://baxsecuritieslaw.com/multilateral-continuous-disclosure-review-and-guidance-for-independent-review-committees-is-published/) [nextBAX Securities Law Announces April Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-april-toronto-business-lawyers-association-monthly-meeting/) ### About BAX Securities Law® Corporate Securities & Financial Services Lawyers BAX Securities Law® practises in the securities and financial services regulatory areas and has acted as counsel to major Canadian and American corporations, market participants. #### Legal Services If you wish to discuss retaining BAX Securities Law® to provide you with legal services, please contact: **Barbara Hendrickson** Managing Partner **416.601.1004** [*bhendrickson@baxsecuritieslaw.com*](mailto:bhendrickson@baxsecuritieslaw.com) [Get In Touch](https://baxsecuritieslaw.com/consult/) **Categories:** News & Updates --- ### [BAX Securities Law Announces April Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-april-toronto-business-lawyers-association-monthly-meeting/) **Published:** March 27, 2024 **Author:** Barbara Hendrickson **Excerpt:** Toronto, April 2, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings.  Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues... **Content:** Toronto, April 2, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings. Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues to the next meeting on Thursday April 18, 2024, at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson over eight years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together regularly for business and professional development purposes. The TBLA meetings are held once a month (the third Thursday of each month) at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services, … The next monthly meeting is at 8:30 am on April 18, 2024, at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . For more information on the TBLA and its events please visit [torontobusinesslawyersassociation.org](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001R9_4YlhaurCRbBnt55ulgUGXaiHMMgykdsL_B0nKrpYImF4KKXPe77sOzwIFzbOrd1LKm_gmQMkXH7Zw8t8VvlqvVOAEC3mOZX-k2Y4Mom3LbEUxxrq6GOAuxbyrSx4P4pZmkvxj1Gj5vDmqYLTUCCWBk3s2o3eeHy-d3vzu14o=&c=fQM_93EOhsXZW0MiGtbpZ1q273zYU_JI5B3ZLGLQXykTFbX-J4poXw==&ch=0hbaTMF9HvdSWRbxk5EYxiwuyTPJZEUG6D2rzlN61JcvgOdDmF_KpA==) or contact Barbara at ([www.baxsecuritieslaw.com](http://www.baxsecuritieslaw.com)) **Categories:** News & Updates --- ### [Canadian Securities Administrators Confirm and Update New Stablecoin Approach](https://baxsecuritieslaw.com/canadian-securities-administrators-confirm-and-update-new-stablecoin-approach/) **Published:** April 19, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have confirmed that it is focused on implementing the interim approach to VCRAs (commonly referred to as stablecoins) even as the regulator has announced the extension of the deadline to October 31st, 2024, for its implementation. The initial deadline of... **Content:** The Canadian Securities Administrators (CSA) have confirmed that it is focused on implementing the interim approach to VCRAs (commonly referred to as stablecoins) even as the regulator has announced the extension of the deadline to October 31st, 2024, for its implementation. The initial deadline of April 30, 2024, after which clients of Crypto Asset Trading Platforms (CTPs) would no longer be permitted to purchase, deposit, or enter crypto contracts to buy or deposit Fiat-Backed Crypto Assets (FBCAs) that do not comply with the interim terms and conditions, has now been extended to October 31st, 2024, due to technical problems reported by CTPs. The CSA has previously indicated through *CSA Staff Notice 21-333*, *Crypto Asset Trading Platforms: Terms and Conditions for Trading Value-Referenced Crypto Assets with Clients* (the Staff Notice), that the regulator may allow, subject to terms and conditions, the continued trading of certain stablecoins that reference a given fiat currency. It had set out interim terms and conditions that would apply to CTPs and the issuers of FBCAs if they wish to continue allowing Canadian clients to purchase or deposit these assets: - The stablecoin issuer must maintain an appropriate reserve of assets with a qualified custodian, held for the benefit of the crypto asset holder; - The stablecoin issuer and crypto asset trading platforms that offer them must make certain information related to governance, operations/ and reserve of assets available to the public. The CSA continues to caution investors that stable coins, including those referencing fiat currencies and satisfying the interim terms and conditions, are subject to various risks and are not the same as fiat currency. The regulator also cautions that because an asset may satisfy its interim terms and conditions, it does not mean the asset is risk-free or somehow endorsed or approved by the organization. *CSA Staff Notice 21-333*, *Crypto Asset Trading Platforms: Terms and Conditions for Trading Value-Referenced Crypto Assets with Clients*, is [available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/2/21-332/csa-staff-notice-21-332-crypto-asset-trading-platforms-pre-registration-undertakings-changes) from CSA members’ websites. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law Announces May Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-may-toronto-business-lawyers-association-monthly-meeting/) **Published:** April 19, 2024 **Author:** Barbara Hendrickson **Excerpt:** Toronto, April 19, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings.  Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues... **Content:** Toronto, April 19, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings. Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues to the next meeting on Thursday May 16, 2024, at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson over eight years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together regularly for business and professional development purposes. The TBLA meetings are held once a month (the third Thursday of each month) at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. The next monthly meeting is at 8:30 am on May 18, 2024, at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . For more information on the TBLA and its events please visit [torontobusinesslawyersassociation.org](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001R9_4YlhaurCRbBnt55ulgUGXaiHMMgykdsL_B0nKrpYImF4KKXPe77sOzwIFzbOrd1LKm_gmQMkXH7Zw8t8VvlqvVOAEC3mOZX-k2Y4Mom3LbEUxxrq6GOAuxbyrSx4P4pZmkvxj1Gj5vDmqYLTUCCWBk3s2o3eeHy-d3vzu14o=&c=fQM_93EOhsXZW0MiGtbpZ1q273zYU_JI5B3ZLGLQXykTFbX-J4poXw==&ch=0hbaTMF9HvdSWRbxk5EYxiwuyTPJZEUG6D2rzlN61JcvgOdDmF_KpA==) or contact Barbara at ([www.baxsecuritieslaw.com](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001Wc_Ki0i15qqm3dJpfIn-pRnPJobgrBdU52pUd4HwXdW3Vmo0OJZdWIPR8HbWIyxFwkp8xWJ4qyWRRGQPJtz1i93SBGbCfYZiKrQlmA1zHodc8h5Xcj1KDrP7kLODsC-nG9csK7HA3lqIv2eswnlAbcL94IcXF1My&c=ahvwTNo6fGBZ36Ejof00cKXyp0kLCFVOL4VLWCBzEVlpCdojA91Oww==&ch=mfZZ_AyQedktYs3yY2vz0a1eeJD1Mjv50foCLHcQiKHO6OqJtLAGXw==)) **Categories:** News & Updates --- ### [Federal Budget 2024 Takes Aim Against Financial Crimes](https://baxsecuritieslaw.com/federal-budget-2024-takes-aim-against-financial-crimes/) **Published:** April 26, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Federal Government’s 2024 Budget (Budget 2024) contains measures against financial crime. Budget 2024 acknowledges that financial crime can range from terrorist financing, corruption, money laundering, fraud, tax evasion, and sanctions evasion. “These crimes have real-world implications, often enabling other criminal behaviour,” says the budget... **Content:** The Federal Government’s 2024 Budget (Budget 2024) contains measures against financial crime. Budget 2024 acknowledges that financial crime can range from terrorist financing, corruption, money laundering, fraud, tax evasion, and sanctions evasion. “These crimes have real-world implications, often enabling other criminal behaviour,” says the budget document. “Financial, crime also undermines the fairness and transparency that are so essential to our economy.” **Anti-Money Laundering and Anti-Terrorist Financing** To combat money laundering, terrorist financing, and sanctions evasion, Budget 2024 contains measures against money laundering, terrorist financing, and sanctions evasion. The government intends to introduce legislative amendments to the *Proceeds of Crime (Money Laundering)* and *Terrorist Financing Act* (PCMLTFA), the *Criminal Code* the *Income Tax Act*, and the *Excise Tax Act.* - Proposed amendments to the PCMLTFA: - Enhance the ability of reporting entities under the PCMLTFA to share information to detect and deter money laundering, terrorist financing, and sanctions evasion, while maintaining privacy protections for personal information, including an oversight role for the Office of the Privacy Commissioner; - Permit the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) to disclose financial intelligence to provincial and territorial civil forfeiture offices to support efforts to seize property linked to unlawful activity; and, Immigration, Refugees and Citizenship Canada to strengthen the integrity of Canada’s citizenship process; - Closing a loophole regarding anti-money laundering and anti-terrorist financing regulatory obligations to cover factoring companies, cheque cashing businesses, and leasing and finance companies, and level the playing field across businesses providing financial services; - Allow FINTRAC to publicize more information around violations of obligations under the PCMLTFA when issuing administrative monetary penalties to strengthen transparency and compliance; and, - Make technical amendments to close loopholes and correct inconsistencies. - Proposed amendments to the *Criminal Code*: - Allow courts to issue an order to require a financial institution to keep an account open to assist in the investigation of a suspected criminal offence; and, - Allow courts to issue a repeating production order to authorize law enforcement to obtain ongoing, specified information on activity in an account or multiple accounts connected to a person of interest in a criminal investigation. - Proposed amendments to the *Income Tax Act* and *Excise Tax Act*: - Ensure Canada Revenue Agency officials who carry out criminal investigations are authorized to seek general warrants through court applications, thereby modernizing and simplifying evidence-gathering processes and helping to fight tax evasion and other financial crimes. **Canada Financial Crimes Agency** - The Department of Finance will receive $1.7 million over 2024-25 to develop the legal framework of the Canada Financial Crimes Agency (CFCA) which will focus on money laundering charges, prosecutions, and convictions, and the seizure of criminal assets. **Fighting Trade-Based Fraud and Money Laundering** - Budget 2024 announced $29.9 million over five years, starting in 2024-25, with $5.1 million in remaining amortization and $4.2 million ongoing, for the Canada Border Services Agency to support the implementation of its enhancements under the PCMLTFA to combat financial crime and strengthen efforts to combat international financial crime with our allies. These enhancements would combat trade-based financial crime and create a Trade Transparency Unit. *Budget 2024* [is available for download](https://budget.canada.ca/2024/report-rapport/toc-tdm-en.html) from the website of the Government of Canada. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law Plays Host to Surakhbayar Galsan, And Mongolian Delegation](https://baxsecuritieslaw.com/bax-securities-law-plays-host-to-surakhbayar-galsan-and-mongolian-delegation/) **Published:** May 27, 2024 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law was pleased to host to an old friend and colleague, Surakhbayar Galsan, LL.M, Founder and Managing Director of BlackRock Partners LLC (BRP).  BRP is a leading consulting firm based in Ulaanbaatar, Mongolia, that deals in management and business consulting and new business development in... **Content:** BAX Securities Law was pleased to host to an old friend and colleague, Surakhbayar Galsan, LL.M, Founder and Managing Director of BlackRock Partners LLC (BRP). BRP is a leading consulting firm based in Ulaanbaatar, Mongolia, that deals in management and business consulting and new business development in Mongolia’s mining and agricultural sectors, as well as specializing in international development and climate change. Surakhbayar was visiting Toronto as part of a team from the School of Law, National University of Mongolia, who also visited Osgoode Hall Law School to discuss the possibility of professional development programs between the two law schools on the development of “Mining”, “Climate Change” and “Environmental” laws, professional development programs for Mongolian professionals. Barbara Hendrickson provided the team with a primer on the historical and latest legal update of Canadian and International Mining Industry and challenges. BRP has recently launched ECCO Farm, a five-year $10 million technical assistance project funded by Global Affairs Canada, focusing on climate change, agriculture, and gender issues. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law Announces June Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-june-toronto-business-lawyers-association-monthly-meeting/) **Published:** June 7, 2024 **Author:** Barbara Hendrickson **Excerpt:** Toronto, June 7, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings.  Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues... **Content:** Toronto, June 7, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings. Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues to the next meeting on Thursday June 20, 2024, at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson over eight years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together regularly for business and professional development purposes. The TBLA meetings are held once a month (the third Thursday of each month) at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. The next monthly meeting is at 8:30 am on June 20, 2024, at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . For more information on the TBLA and its events please visit [torontobusinesslawyersassociation.org](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001R9_4YlhaurCRbBnt55ulgUGXaiHMMgykdsL_B0nKrpYImF4KKXPe77sOzwIFzbOrd1LKm_gmQMkXH7Zw8t8VvlqvVOAEC3mOZX-k2Y4Mom3LbEUxxrq6GOAuxbyrSx4P4pZmkvxj1Gj5vDmqYLTUCCWBk3s2o3eeHy-d3vzu14o=&c=fQM_93EOhsXZW0MiGtbpZ1q273zYU_JI5B3ZLGLQXykTFbX-J4poXw==&ch=0hbaTMF9HvdSWRbxk5EYxiwuyTPJZEUG6D2rzlN61JcvgOdDmF_KpA==) or contact Barbara at ([www.baxsecuritieslaw.com](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001Wc_Ki0i15qqm3dJpfIn-pRnPJobgrBdU52pUd4HwXdW3Vmo0OJZdWIPR8HbWIyxFwkp8xWJ4qyWRRGQPJtz1i93SBGbCfYZiKrQlmA1zHodc8h5Xcj1KDrP7kLODsC-nG9csK7HA3lqIv2eswnlAbcL94IcXF1My&c=ahvwTNo6fGBZ36Ejof00cKXyp0kLCFVOL4VLWCBzEVlpCdojA91Oww==&ch=mfZZ_AyQedktYs3yY2vz0a1eeJD1Mjv50foCLHcQiKHO6OqJtLAGXw==)) **Categories:** News & Updates --- ### [Securities Regulators Publish Blanket Order Permitting Exempt Market Dealer to Participate in Selling Groups to Sell Securities under Prospectus](https://baxsecuritieslaw.com/securities-regulators-publish-blanket-order-permitting-exempt-market-dealer-to-participate-in-selling-groups-to-sell-securities-under-prospectus/) **Published:** June 28, 2024 **Author:** Barbara Hendrickson **Excerpt:** On June 20, 2024, the securities regulatory authorities in Alberta, British Columbia, Nova Scotia, Ontario, Québec and Saskatchewan (the participating jurisdictions) published a temporary exemption from the restrictions set out in subsection 7.1(2) (d) of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations... **Content:** On June 20, 2024, the securities regulatory authorities in Alberta, British Columbia, Nova Scotia, Ontario, Québec and Saskatchewan (the participating jurisdictions) published a temporary exemption from the restrictions set out in subsection 7.1(2) (d) of *National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations* so that exempt market dealers may participate in prospectus offerings as members of selling groups (the Blanket Orders). The participating jurisdictions have implemented the relief through local blanket orders that are substantively harmonized across the participating jurisdictions. Although the intended outcomes of the Blanket Orders are similar; the language of each Blanket Order may vary according to jurisdiction. The Financial and Consumer Services Commission of New Brunswick (FCNB), which is the securities regulator in that province, anticipates publishing a similar local blanket order in the coming weeks. The Blanket Orders provide that an exempt market dealer may act as a dealer in a distribution of securities made under a prospectus, provided that certain conditions are satisfied. Details on these conditions, as well as the other terms and conditions necessary to be satisfied, are included in the Blanket Orders: (a) the exempt market dealer acts as a dealer only in accordance with the terms of a selling group agreement with the issuer or an investment dealer acting as the lead underwriter in the distribution of the securities made under the prospectus; (b) the exempt market dealer acts as a dealer only to a person or company in respect of whom an exemption from the prospectus requirement would have been available if the distribution of securities had been made under an exemption from the prospectus requirement; (c) the exempt market dealer does not act as an underwriter in connection with the distribution of the securities under the prospectus and limits its interest in the transaction such that it comes within the exemption for selling group members in clause (a) of the definition of “underwriter” in the Ontario Securities Act; and (d) the total compensation paid or payable to the exempt market dealer does not exceed 50% of the lowest total amount of compensation paid or payable in connection with the distribution of the securities under the prospectus to any selling group member that is an investment dealer. The Blanket Orders come into effect on June 20, 2024, and remain in effect until December 20, 2025, unless extended by the participating jurisdictions. *CSA Notice Regarding Coordinated Blanket Order 31-930 Exemption to allow Exempt Market Dealer Participation in Selling Groups in Offerings of Securities under a Prospectus* from the website of the Ontario Securities Commission: For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Regulator Launches Consultation on Total Cost Reporting for Seg Funds](https://baxsecuritieslaw.com/ontario-regulator-launches-consultation-on-total-cost-reporting-for-seg-funds/) **Published:** July 17, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Financial Services Regulatory Authority of Ontario (FSRA) launched a public consultation for a period ending July 26, 2024, on proposed Rule 2024 – 002 - Total Cost Reporting (the Proposed Rules) that will affect how insurers report segregated fund investment products to clients. The... **Content:** The Financial Services Regulatory Authority of Ontario (FSRA) launched a public consultation for a period ending July 26, 2024, on proposed *Rule 2024 – 002 – Total Cost Reporting* (the Proposed Rules) that will affect how insurers report segregated fund investment products to clients. The Proposed Rules would require insurers to provide customers with improved annual statements about the performance and embedded costs and fees associated with owning seg funds. If approved, the approach to disclosing total costs and fees will become consistent for all segregated fund issuers. The objective of this consultation is to obtain feedback from stakeholders, including insurers and investors. If the Proposed Rule is adopted, the changes would be effective for customer statements for the year ending December 31, 2026, in early 2027. Under the Proposed Rules, statements issued to investors by insurers will have to include information such as: - the total cost of investing, including ongoing embedded fees such as management expenses and trading expenses; - additional information on the segregated funds’ investment performance; - a customer’s right to guarantees under their segregated fund contracts and how certain actions might affect their guarantees; and, - information to more easily allow customers to compare the cost of owning segregated funds with the cost of owning other investments. *Rule 2024 – 002 – Total Cost Reporting* [is available for download](https://www.fsrao.ca/media/25696/download) from the website of the Financial Services Regulatory Authority of Ontario. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Announce Changes To Derivatives Data Reporting Standards](https://baxsecuritieslaw.com/canadian-securities-regulators-announce-changes-to-derivatives-data-reporting-standards/) **Published:** July 29, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published final amendments (the Amendments) that streamline and harmonize over-the-counter (OTC) derivatives data reporting with global standards, which became effective on July 25, 2025. The Amendments are expected to reduce the complexity of market participants’ reporting systems and decrease... **Content:** The Canadian Securities Administrators (CSA) has published final amendments (the Amendments) that streamline and harmonize over-the-counter (OTC) derivatives data reporting with global standards, which became effective on July 25, 2025. The Amendments are expected to reduce the complexity of market participants’ reporting systems and decrease ongoing operational and compliance costs while improving the consistency and quality of the data available to regulators and the public. Included with the Amendments is a harmonized CSA Derivatives Data Technical Manual (the Technical Manual) that provides clarity and consistency regarding the format and values for reporting harmonized data elements. These updated data elements align with international standards developed by the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO). In addition, the amendments also include: - Updated requirements for trade repository governance, operations and management of risk to align with international standards; - Improvements that enhance data accuracy and consistency, such as data validation and verification, similar to other global regulators; - Greater harmonization within the CSA, including a harmonized threshold in the commodity derivatives exclusion for non- dealers; - Extended reporting deadlines for end-users; - Optional position level data reporting for certain types of derivatives; and, - Changes to reporting for derivatives executed anonymously on trading facilities such as swap execution facilities. The regulator reminds all Canadian market participants transacting OTC derivatives that they must renew their legal entity identifier (LEI). Any Canadian market participant that has outstanding OTC derivatives and does not renew its LEI is not in compliance with securities law. *The amendments to Trade Repositories and Derivatives Data Reporting and related Companion Policies*[ *are available for download*](https://www.osc.ca/en/securities-law/instruments-rules-policies/9/91-507) from the websites of the participating jurisdictions. *The Technical Manual is published in Manitoba Securities Commission* [*Staff Notice 91-701*](https://docs.mbsecurities.ca/msc/derivatives/en/item/521304/index.do)*, Ontario Securities Commission* [*Staff Notice 91-705*](https://www.osc.ca/en/securities-law/instruments-rules-policies/9/91-705/osc-staff-notice-91-705-revised-csa-derivatives-data-technical-manual) *, and in the relevant* [*Companion Policy*](https://www.securities-administrators.ca/news/canadian-securities-regulators-announce-changes-to-derivatives-data-reporting-standards/#N96101) *for the remaining jurisdictions.* For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Administrators publish Notice and Request for Comment on proposed Canadian Securities Exchange Senior Tier](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-notice-and-request-for-comment-on-proposed-canadian-securities-exchange-senior-tier/) **Published:** August 7, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published a package of proposed amendments (the Proposed Amendments), including a proposal by the Canadian Securities Exchange (CSE) to establish a new senior tier of Venture Issuer (the Venture Issuer Tier) for review and comment for a 90-day period... **Content:** The Canadian Securities Administrators (CSA) has published a package of proposed amendments (the Proposed Amendments), including a proposal by the Canadian Securities Exchange (CSE) to establish a new senior tier of Venture Issuer (the Venture Issuer Tier) for review and comment for a 90-day period ending October 30, 2024. Prominent among the Proposed Amendments is the proposal by the CSE for the creation of the new Venture Issuer Tier. This new Senior Tier is intended for non-venture issuers, with requirements that align with those of a non-venture exchange. The proposed amendments and changes revise the definition of “venture issuer” to exclude the CSE’s Senior Tier companies, allowing the CSE’s Senior Tier issuers to be treated the same way under securities legislation as issuers listed on other non- venture exchanges. The Proposed Amendments also include proposed amendments and changes on the following other matters: - Aligning certain exemptions and eligibility requirements so that they apply to the CSE in the same manner as they do for other similar exchanges. - Codifying blanket orders issued by CSA members to accommodate recent “majority voting” amendments to the *Canada Business Corporations Act.* - Reflect the name changes of the former Aequitas NEO Exchange Inc. to Cboe Canada Inc. and the former PLUS markets to AQSE Growth Market. and, - Remove the requirement for escrow agreements to be signed, sealed and delivered by securityholders in the presence of a witness The Proposed Amendments[ *are available for download*](https://www.osc.ca/en/securities-law/instruments-rules-policies/4/41-101/csa-notice-and-request-comment-proposed-amendments-and-changes-certain-national-instruments-and) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BCSC Calls for Changes to Federal Bankruptcy Law](https://baxsecuritieslaw.com/bcsc-calls-for-changes-to-federal-bankruptcy-law/) **Published:** August 7, 2024 **Author:** Barbara Hendrickson **Excerpt:** The British Columbia. Securities Commission (BCSC) is calling for changes to the federal Bankruptcy and Insolvency Act (the Act) after the Supreme Court of Canada ruled that some financial sanctions can be extinguished through the bankruptcy process. The Court, ruled in a 5-2 decision, that... **Content:** The British Columbia. Securities Commission (BCSC) is calling for changes to the federal Bankruptcy and Insolvency Act (the Act) after the Supreme Court of Canada ruled that some financial sanctions can be extinguished through the bankruptcy process. The Court, ruled in a 5-2 decision, that administrative penalties, which are imposed by the BCSC and other Canadian securities regulators to deter future misconduct, can be eliminated from a person’s debt upon being discharged from bankruptcy. The regulator is concerned that the extinguishing of these administrative penalties seriously undermines securities regulators’ duty to protect investors. It believes this highlights a significant flaw in federal bankruptcy law that needs to be addressed. The BCSC’s concerns stem from a ruling against a BC couple who ran a pump-and-dump scheme involving an Ontario company whose shares traded on the TSX Venture Exchange. Although the couple were ordered to pay financial sanctions amounting to over $19 million, which included administrative penalties and the disgorgement of illegally obtained profits, they subsequently filed for bankruptcy. After having their request to have the sanctions extinguished as part of their bankruptcy turned down by the provincial court, the couple appealed to the Supreme Court of Canada, which reversed the decision. The regulator had opposed this, arguing before the Court that the Act allows some types of debts to survive bankruptcy, including: - Debts arising from a fine, penalty or restitution order imposed by a court; and, - Debts arising by obtaining property or services by fraudulent misrepresentation. The BCSC argued unsuccessfully that its sanctions met these criteria, but the court disagreed, stating despite being registered with a court, the sanctions did not qualify as court-imposed orders. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX’s Barbara Hendrickson included in the 2024 edition of The Best Lawyers in Canada](https://baxsecuritieslaw.com/baxs-barbara-hendrickson-included-in-the-2024-edition-of-the-best-lawyers-in-canada/) **Published:** August 29, 2024 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law is pleased to announce that its founder and Securities Partner, Barbara Hendrickson, is included in the 2024 edition of The Best Lawyers in Canada. Best Lawyers, the oldest and most respected legal rankings company, has announced that Barbara Hendrickson will be included... **Content:** BAX Securities Law is pleased to announce that its founder and Securities Partner, Barbara Hendrickson, is included in the 2024 edition of *The Best Lawyers in Canada*. *Best Lawyers*, the oldest and most respected legal rankings company, has announced that Barbara Hendrickson will be included in the 2024 edition of *The Best Lawyers in Canada™*. BAX Securities Law is one of Canada’s leading corporate securities law firms. Barbara Hendrickson has a twenty-plus-year career that has included stints with Canada’s largest securities regulator, one of the world’s largest law firms, and a highly ranked national law firm. The Best Lawyer awards are given to lawyers who while demonstrating comprehensive expertise in their professional practices, also have also shown adaptability, ethics, and leadership. *The Best Lawyer* awards are rightly seen as of symbols of esteem and the recognition of integrity in the legal community. According to the CEO of Best Lawyers Phillip Greer, “*The Best Lawyers in Canada* recipients exhibit a profound knowledge of the law as well as an unwavering commitment to their clients, their communities and their pursuit of justice. These lawyers have been recognized by their peers for their leadership, their innovative legal strategies for clients and their pursuit of justice. Their professionalism sets them apart as true principals in the legal field.” Lawyers were selected by Best Lawyers using its proprietary Purely Peer review process. Fewer than 7,300 lawyers were nominated by their peers for inclusion in the 2024 edition of The Best Lawyers in Canada. For more information on BAX Securities Law and Barbara’s practice, please call Barbara Hendrickson (647) 403-4606 or contact her at bhendrickson@baxsecuritieslaw.com. 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. **Categories:** News & Updates --- ### [CIRO Publishes Draft Amendment To Proficiency Rules For Investment Dealer Approved Persons For Review And Comment](https://baxsecuritieslaw.com/ciro-publishes-draft-amendment-to-proficiency-rules-for-investment-dealer-approved-persons-for-review-and-comment/) **Published:** September 9, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Investment Regulatory Organization (CIRO) is publishing for comment proposed amendments to the Investment Dealer and Partially Consolidated Rules (IDPC, the Draft Rule Amendments) reflecting the proposed proficiency model, for a period ending September 17, 2024. The Draft Rule Amendments focus on the proficiency... **Content:** The Canadian Investment Regulatory Organization (CIRO) is publishing for comment proposed amendments to the Investment Dealer and Partially Consolidated Rules (IDPC, the Draft Rule Amendments) reflecting the proposed proficiency model, for a period ending **September 17, 2024.** The Draft Rule Amendments focus on the proficiency regime relating to individuals employed by investment dealers approved by CIRO under the IDPC. The regulator advises any future changes to the proficiency regime relating to mutual fund dealers will be made in collaboration with the Canadian Securities Administrators (CSA). The Draft Rule Amendments are intended to deliver the following benefits: - Raise the proficiency bar; • Lower the cost of licensing and entry barriers for end-users; • Improve alignment to firm training; and, • Improve program currency and relevancy and be more responsive to industry change. As noted, one of the benefits of the Draft Rule Amendments is to raise the level of proficiency of dealer Approved Persons. Highlights of the proposed proficiency model are as follows: - Exams for each Approved Person category based on the published competency profiles, including a general exam for some Approved Person categories; - No mandatory courses as prerequisites to exams; - Mandatory conduct training upon approval; - Continuing Education (CE) training on topics mandated by CIRO annually; - Baseline education requirements for Registered Representatives (RRs) to include a diploma, degree or four years of relevant work experience; and, - A greater role for CIRO in new program design and ongoing delivery. The Draft Rule Amendments are part of the ongoing Rule Consolidation Project. They incorporate the previously proposed clarifying amendments that will be implemented in the next few months. The proposed amendments to the *Investment Dealer and Partially Consolidated* Rules [ are available for download](https://www.ciro.ca/news-room/publications/rule-amendments-request-comments-proposed-proficiency-model-approved-persons-under-investment-dealer) from CIRO’s website. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law Announces October Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-may-toronto-business-lawyers-association-monthly-meeting-2/) **Published:** September 9, 2024 **Author:** Barbara Hendrickson **Excerpt:** Toronto, September 9, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings. Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues... **Content:** Toronto, September 9, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings. Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues to the next meeting on Thursday October 17, 2024, at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson over eight years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together regularly for business and professional development purposes. The TBLA meetings are held once a month at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. The next monthly meeting is at 8:30 am on October 17, 2024, at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . For more information on the TBLA and its events please contact Barbara at ([www.baxsecuritieslaw.com](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001Wc_Ki0i15qqm3dJpfIn-pRnPJobgrBdU52pUd4HwXdW3Vmo0OJZdWIPR8HbWIyxFwkp8xWJ4qyWRRGQPJtz1i93SBGbCfYZiKrQlmA1zHodc8h5Xcj1KDrP7kLODsC-nG9csK7HA3lqIv2eswnlAbcL94IcXF1My&c=ahvwTNo6fGBZ36Ejof00cKXyp0kLCFVOL4VLWCBzEVlpCdojA91Oww==&ch=mfZZ_AyQedktYs3yY2vz0a1eeJD1Mjv50foCLHcQiKHO6OqJtLAGXw==)) **Categories:** News & Updates --- ### [Canadian Securities Administrators Extends Again Deadline For The Trading Of Stablecoins](https://baxsecuritieslaw.com/canadian-securities-administrators-extends-again-deadline-for-the-trading-of-stablecoins/) **Published:** October 1, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has extended its deadline yet again to December 31, 2024, so that crypto asset trading platforms (CTPs) that have not registered or provided a pre-registration undertaking (PRU) have until that date to allow clients to buy, deposit, or enter into... **Content:** The Canadian Securities Administrators (CSA) has extended its deadline yet again to **December 31, 2024**, so that crypto asset trading platforms (CTPs) that have not registered or provided a pre-registration undertaking (PRU) have until that date to allow clients to buy, deposit, or enter into crypto contracts to buy or deposit value-referenced crypto assets (VRCAs, commonly referred to as stablecoins). The CSA continues to note that investors have experienced significant harm from the collapse of unregulated VRCAs, other VRCA market disruptions and the activities of unregistered crypto market participants. While other international jurisdictions are developing payment-based, banking-based or hybrid regulatory regimes for certain types of VRCAs, no such regulated VRCAs are being traded in Canada and the CSA is not aware of any initiative to develop similar regulatory regimes in Canada. The amended timeline follows the publication in 2023 of *CSA Staff Notice 21-333 Crypto Asset Trading Platforms: Terms and Conditions for Trading Value-Referenced Crypto Assets with Clients* (2023 Staff Notice), acknowledging that certain VRCAs may be useful to Canadian clients of CTPs, especially those VCRAs that are referenced to the value of a single fiat currency (e.g. fiat-backed crypto assets, stablecoins, FBCAs). The 2023 Staff Notice described terms and conditions that would address the CSA’s investor protection concerns. The 2023 Staff Notice included a deadline of April 30, 2024, since extended to October 31, 2024, after which CTPs would no longer allow clients to buy, deposit, or enter into crypto contracts to buy or deposit FBCAs that do not comply with the terms and conditions of the 2023 Staff Notice. The new deadline of December 31, 2024 (the new deadline) is intended to provide more time for CTPs to either comply with the terms and conditions of their registration and exemptive relief decisions, or their PRUs, or to propose alternatives that address investor protection concerns, as long as they are in place or substantially finalized before the new deadline. *CSA Staff Notice 21-333 Crypto Asset Trading Platforms: Terms and Conditions for Trading Value-Referenced Crypto Assets with Clients* [ is available for download](https://www.securities-administrators.ca/news/csa-provides-update-to-crypto-asset-trading-platforms-about-value-referenced-crypto-assets/#N21333) from the website of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Securities Commission Publishes Study on Artificial Intelligence and Retail Investing](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-study-on-artificial-intelligence-and-retail-investing/) **Published:** October 2, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) has published Artificial Intelligence and Retail Investing: Use Cases and Experimental Research (the Report), which discusses the results of a behavioural science experiment that focused on the role of artificial intelligence (AI) in supporting retail investor decision-making. The experiment consisted... **Content:** The Ontario Securities Commission (OSC) has published *Artificial Intelligence and Retail Investing: Use Cases and Experimental Research* (the Report), which discusses the results of a behavioural science experiment that focused on the role of artificial intelligence (AI) in supporting retail investor decision-making. The experiment consisted of an online investment simulation to test how closely Canadians followed a suggestion for how to invest a hypothetical $20,000. Participants were told the suggestion came from one of three sources: a human financial services provider, an AI tool, or a human financial services provider using an AI tool (a ‘blended’ approach). The research team then measured how closely participants adhered to the investment suggestion when investing their $20,000. Results of the experiment showed that participants who received the investment suggestion from a human using an AI tool (‘blended’) adhered to the investment suggestion most closely, although this difference was not significant. Notably, there was no discernible difference in adherence to investment suggestions provided by a human or AI tool, indicating Canadian investors may be receptive to taking advice from an AI system. OSC researchers also examined the current investor-facing use cases of AI in Canada and abroad. In doing so, they identified three broad use cases: 1. **Decision support** involves AI systems that provide recommendations or advice to guide investment decisions. 2. **Automation** consists of AI systems that automate portfolio and/or fund (e.g., ETF) management. 3. **Scams and fraud** include AI systems that either facilitate or mitigate scams targeting retail investors scams capitalizing on the “buzz” of AI. The Report details both benefits and risks from the first two use cases. For instance, AI systems could provide increased access to more affordable advice for investors, but there is also the possibility that systems may provide investors with advice that is biased or not relevant, appropriate, or accurate. As AI-enhanced scams and frauds may pose significant risks to investors, the OSC continues to research its use, as well as ways to provide effective investor protection and potential mitigation strategies. *Artificial Intelligence and Retail Investing: Use Cases and Experimental Research*[ is available for download](https://www.osc.ca/en/investors/investor-research-and-reports/artificial-intelligence-and-retail-investing) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson Featured in Whistleblowing Canada  Directory](https://baxsecuritieslaw.com/barbara-hendrickson-featured-in-whistleblowing-canada-directory/) **Published:** October 2, 2024 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law’s Barb Hendrickson is pleased to announce that she is appearing in a new legal directory, The Ontario Lawyers Directory for Whistleblowers (the Directory), published by Whistleblowing Canada. The goal of the Directory, published by Whistleblowing Canada with the support of the Law... **Content:** BAX Securities Law’s Barb Hendrickson is pleased to announce that she is appearing in a new legal directory, *The Ontario Lawyers Directory for Whistleblowers* (the Directory), published by Whistleblowing Canada. The goal of the Directory, published by Whistleblowing Canada with the support of the Law Foundation of Ontario, aims to reduce the isolation many whistleblowers feel by connecting these individuals with experienced legal professionals who can provide the critical support they need. Whistleblowers who come forward to expose wrongdoing often struggle to find legal representation and feel isolated and unsupported in their efforts to uphold the law and professional standards. It is this perceived lack of support that sometimes deters many whistleblowers from coming forward in the first place. Since its inception in 2019, Whistleblowing Canada has been a welcome support for individuals who courageously come forward to expose wrongdoing. It remains committed to improving access to justice for one of the most underserved populations in Ontario. *The Ontario Lawyers Directory for Whistleblowers* can be accessed on the website of the [Whistleblowing Research Society](https://www.whistleblowingcanada.com/directory_lawyers). For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson Gives Guest Lecture To Ukrainian Law Students](https://baxsecuritieslaw.com/barbara-hendrickson-to-give-guest-lecture-to-ukrainian-law-students/) **Published:** October 2, 2024 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law’s Barbara Hendrickson gave a guest lecture via Zoom to a class of students at Kyiv’s State Tax University, Sept 23, 2024 Barbara will speak on the topic: "The Legal Profession in Canada: Challenges and Opportunities in International Legal Practice." During the lecture,... **Content:** BAX Securities Law’s Barbara Hendrickson gave a guest lecture via Zoom to a class of students at Kyiv’s State Tax University, Sept 23, 2024 Barbara will speak on the topic: “The Legal Profession in Canada: Challenges and Opportunities in International Legal Practice.” During the lecture, Barbara shared her experience as a lawyer in Canada, discussed the specifics of the Canadian legal system, and explained how corporate lawyers interact with international clients and companies. She also talked about the specifics of legal practice in different jurisdictions and receive valuable advice on building a career in international law. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Webinar Invite: Canadian Money Laundering and Terrorist Financing Legislation – the Basics](https://baxsecuritieslaw.com/webinar-invite-canadian-money-laundering-and-terrorist-financing-legislation-the-basics/) **Published:** October 17, 2024 **Author:** Barbara Hendrickson **Excerpt:** “One need not look further than the headlines to realize the anti-money and anti-terrorist financing are becoming the focus of increased regulatory scrutiny.” Please join Barbara Hendrickson of BAX Securities Law and Natalie Ochrym and Claude Baksh of Grace Compliance Services Inc. on November 14, 2024 at 2:00... **Content:** “One need not look further than the headlines to realize the anti-money and anti-terrorist financing are becoming the focus of increased regulatory scrutiny.” Please join Barbara Hendrickson of BAX Securities Law and Natalie Ochrym and Claude Baksh of Grace Compliance Services Inc. on November 14, 2024 at 2:00 PM EST for a webinar to discuss Canadian legislation in the areas of money laundering and terrorist financing. Speakers will address: - What is Money Laundering? - What is Terrorist Financing? - What Laws Apply to Us? - The Stages of Money Laundering - Mandatory Requirements Under the Act and the Regulations - Know-Your-Client Requirements - Politically Exposed Persons and Heads of International Organizations - Red Flags - Enhanced Due Diligence Measures for High-Risk Clients - Records We Must Create and Keep - Required Reports - Penalties for Non-Compliance If you are interested in knowing more about your obligations under federal legislation in the money laundering and terrorist financing areas please join us on November 14, 2024, at 2:00 EST. Participants will have the opportunity to ask questions during the webinar. Please RSVP to Barbara Hendrickson at or Natalie Ochrym at . **Categories:** News & Updates --- ### [BAX Securities Law named in Best Lawyers™ inaugural “Best Law Firms™ in Canada” list for 2025](https://baxsecuritieslaw.com/bax-securities-law-named-in-best-lawyers-inaugural-best-law-firms-in-canada-list-for-2025/) **Published:** November 4, 2024 **Author:** Barbara Hendrickson **Excerpt:** Barbara Hendrickson, Founder and Managing Partner of BAX Securities Law, is pleased to announce that Best Lawyers™ has recognized BAX Securities Law in the inaugural edition of Best Law Firms - Canada. The Canadian Best Lawyers™ rankings celebrate firms that have consistently demonstrated excellence in legal... **Content:** Barbara Hendrickson, Founder and Managing Partner of BAX Securities Law, is pleased to announce that Best Lawyers™ has recognized BAX Securities Law in the inaugural edition of [Best Law Firms – Canada](https://www.bestlawfirms.com/canada/ontario/toronto). The Canadian Best Lawyers™ rankings celebrate firms that have consistently demonstrated excellence in legal expertise and industry knowledge. Each firm included has been rigorously evaluated based on client feedback, peer recommendations, leadership interviews, and the depth of their practice. The Best Lawyers™ firm ranking is internationally known as a comprehensive guide for businesses and individuals seeking top-tier legal counsel in Canada. “We are honoured to be included in this list of highly regarded Canadian law firms which reflects our efforts over the last 12 years to provide big law firm expertise and service in a boutique law firm setting,” said Barbara Hendrickson. For more information on BAX Securities Law and its services, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. **Categories:** News & Updates --- ### [Canadian Securities Administrators Complete Tenth Annual Review of the Representation of Women on Boards and in Executive Officer Positions in Canada](https://baxsecuritieslaw.com/canadian-securities-administrators-complete-tenth-annual-review-of-the-representation-of-women-on-boards-and-in-executive-officer-positions-in-canada/) **Published:** November 4, 2024 **Author:** Barbara Hendrickson **Excerpt:** Participating Canadian securities regulatory authorities have published the results the tenth annual review of disclosures relating to women on boards and in executive officer positions, CSA Multilateral Staff Notice 58-317 Review of Disclosure Regarding Women on Boards and in Executive Officer Positions (Year 10 Report) The... **Content:** Participating Canadian securities regulatory authorities have published the results the tenth annual review of disclosures relating to women on boards and in executive officer positions, *CSA Multilateral Staff Notice 58-317 Review of Disclosure Regarding Women on Boards and in Executive Officer Positions (Year 10 Report)* The findings summarize the corporate governance disclosures of 574 non-venture issuers and have been published by securities regulatory authorities in Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Ontario, Quebec, Saskatchewan, and Yukon (the participating jurisdictions). Key highlights include: - Twenty-nine per cent of board seats were held by women this year, compared to 27 per cent last year and 11 per cent in year one. - Ninety per cent of issuers had at least one woman on their board this year, compared to 89 per cent last year and 49 per cent in year one. - Seventy-two per cent of issuers had at least one woman in an executive officer position this year, compared to 71 per cent last year and 60 per cent in year one. - The percentage of board vacancies filled by women decreased from 43 per cent last year to 37 per cent this year. *CSA Multilateral Staff Notice 58-317 Review of Disclosure Regarding Women on Boards and in Executive Officer Positions (Year 10 Report)* [ *is available for download*](https://www.osc.ca/en/securities-law/instruments-rules-policies/5/58-317) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canada Releases Draft Regulations to Cap Pollution in the Oil And Gas Industry](https://baxsecuritieslaw.com/canada-releases-draft-regulations-to-cap-pollution-in-the-oil-and-gas-industry/) **Published:** November 8, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Government of Canada recently introduced Proposed Draft Regulations to limit greenhouse gas pollution from oil and gas production. The Proposed Oil and Gas Sector Greenhouse Gas Emissions Cap Regulations and Proposed Regulations Amending the Output-Based Pricing System Regulations (the Proposed Draft Regulations) work by... **Content:** The Government of Canada recently introduced Proposed Draft Regulations to limit greenhouse gas pollution from oil and gas production. *The Proposed Oil and Gas Sector Greenhouse Gas Emissions Cap Regulations and Proposed Regulations Amending the Output-Based Pricing System Regulations* (the Proposed Draft Regulations) work by setting a cap on greenhouse gas pollution within the sector, equivalent to 35 per cent below 2019 levels. The Proposed Draft Regulations would create a cap-and- trade system designed to recognize better-performing companies and incentivize those that are higher polluting to invest in making their production processes cleaner. They have been informed by extensive engagement by the Government of Canada with industry, Indigenous groups, provinces and territories, and other stakeholders. Canada is the world’s fourth-largest producer of oil and the fifth-largest producer of gas. As demand for oil and gas peaks in the coming decade and begins to decline, the fuels extracted with the least amount of pollution will be in highest demand. The oil and gas greenhouse gas pollution cap will help the sector remain competitive as the global economy continues to decarbonize and allow Canada to quickly and effectively respond to shifting global demand. The oil and gas greenhouse gas pollution cap is part of a suite of measures to cut pollution, including significant financial supports for carbon capture and storage and other clean technologies that also support workers, namely through the federal Canada Growth Fund and new investment tax credits. The Government of Canada will continue to consult to inform the final regulations, which it plans to publish next year. Written comments in response to the Proposed Draft Regulations can be submitted during the formal consultation period from November 9, 2024, to January 8, 2025. *The Proposed Oil and Gas Sector Greenhouse Gas Emissions Cap Regulations and Proposed Regulations Amending the Output-Based Pricing System Regulations* [ *are available for download*](https://www.canada.ca/content/dam/eccc/documents/pdf/climate-change/oil-gas-emissions-cap/Combined-OGEC_OBPSR-unofficial-watermarked.pdf) from the websites of the Government of Canada. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Publish Coordinated Blanket Orders to Provide Temporary Exemptions From Certain Derivatives Data Reporting Requirements](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-coordinated-blanket-orders-to-provide-temporary-exemptions-from-certain-derivatives-data-reporting-requirements/) **Published:** November 11, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) recently published Coordinated Blanket Order 96-932 Re Temporary Exemptions from Certain Derivatives Data Reporting Requirements (the Blanket Order), which became effective October 31, 2024. The Blanket Orders provide immediate exemptions market participants (end users) prior to the July 25th, 2025, effective... **Content:** The Canadian Securities Administrators (CSA) recently published [Coordinated Blanket Order 96-932 Re Temporary Exemptions from Certain Derivatives Data Reporting Requirements](https://www.securities-administrators.ca/news/canadian-securities-regulators-publish-coordinated-blanket-orders-to-provide-temporary-exemptions-from-certain-derivatives-data-reporting-requirements/#N96932) (the Blanket Order), which became effective October 31, 2024. The Blanket Orders provide immediate exemptions market participants (end users) prior to the July 25th, 2025, effective date of the Amendments that the CSA published in July 2024. Among other changes, the Amendments will reduce regulatory burden for certain market participants (end-users). The Blanket Order allow end-users to benefit from the reduction in regulatory burden prior to the effective date of the Amendments. They will provide end-users with an exemption from reporting valuation data and an extension to reporting deadlines and will result in substantively CSA-harmonized exemptions for commodity derivatives and inter-affiliate derivatives between end- users. Every member of the CSA is implementing the relief through a local blanket order. *Coordinated Blanket Order 96-932 Re Temporary Exemptions from Certain Derivatives Data* *Reporting Requirements* [is available for download](https://baxsecuritieslaw.com/wp-content/uploads/2024/11/20241031_96-932_coordinated-blanket-order.pdf) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law Announces November Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-november-toronto-business-lawyers-association-monthly-meeting/) **Published:** November 11, 2024 **Author:** Barbara Hendrickson **Excerpt:** Toronto, November 11, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings.  Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues... **Content:** Toronto, November 11, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings. Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues to the next meeting on Thursday November 21, 2024, at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson over eight years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together regularly for business and professional development purposes. The TBLA meetings are held once a month at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. The next monthly meeting is at 8:30 am on November 21, 2024, at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . For more information on the TBLA and its events please contact Barbara at ([www.baxsecuritieslaw.com](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001Wc_Ki0i15qqm3dJpfIn-pRnPJobgrBdU52pUd4HwXdW3Vmo0OJZdWIPR8HbWIyxFwkp8xWJ4qyWRRGQPJtz1i93SBGbCfYZiKrQlmA1zHodc8h5Xcj1KDrP7kLODsC-nG9csK7HA3lqIv2eswnlAbcL94IcXF1My&c=ahvwTNo6fGBZ36Ejof00cKXyp0kLCFVOL4VLWCBzEVlpCdojA91Oww==&ch=mfZZ_AyQedktYs3yY2vz0a1eeJD1Mjv50foCLHcQiKHO6OqJtLAGXw==)) **Categories:** News & Updates --- ### [Ontario Securities Commission Publishes Consultation Paper To Facilitate Investment Opportunities In Long-Term Illiquid Assets](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-consultation-paper-to-facilitate-investment-opportunities-in-long-term-illiquid-assets/) **Published:** November 12, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) recently published OSC Consultation Paper 81-737 Opportunity to Improve Retail Investor Access to Long-Term Assets through Investment Fund Product Structures (The Consultation Paper). The Consultation Paper sets out a framework proposal (the Proposal) to facilitate investment opportunities in long-term illiquid... **Content:** The Ontario Securities Commission (OSC) recently published *OSC Consultation Paper 81-737 Opportunity to Improve Retail Investor Access to Long-Term Assets through Investment Fund Product Structures* (The Consultation Paper). The Consultation Paper sets out a framework proposal (the Proposal) to facilitate investment opportunities in long-term illiquid assets, which will be referred to as Long-Term Assets, through an investment fund product structure. The purpose of the Proposal is to enhance the experience of individual investors and to foster conditions for capital formation and innovation in both public and private markets. The Proposal offers potential benefits to investors and businesses, and could lead to increased investment in capital-intensive assets, such as infrastructure, natural resource projects, and other long-term interests. “Long-Term Assets” fall within the definition of “illiquid assets” in section 1.1 of National Instrument 81-102 *Investment Funds* (**NI 81-102**) are illiquid assets that cannot be readily disposed of, may be difficult to value, and generally have longer investment time horizons than other assets. They include venture capital, private equity, private debt, mortgages, real estate, infrastructure, and natural resource projects. While this would include capital-intensive assets in Ontario, we do not propose to limit our Proposal to assets that are located within Ontario. The OSC is publishing the Consultation Paper to seek feedback from stakeholders to identify the key success factors, as well as areas of concern with the Proposal. Stakeholder feedback will be considered in the next phase, when the regulator anticipates publishing the proposed rule amendments for comment. *OSC Consultation Paper 81-737 Opportunity to Improve Retail Investor Access to Long-Term Assets through Investment Fund Product Structures* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/8/81-737/osc-consultation-paper-81-737-opportunity-improve-retail-investor-access-long-term-assets-through) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Ontario Securities Commission Publishes Summary Report](https://baxsecuritieslaw.com/ontario-securities-commission-publishes-summary-report/) **Published:** November 12, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Ontario Securities Commission (OSC) recently published its Summary Report for Investment Fund and Structured Product Issuers (The Summary Report), which provides an overview of key activities undertaken by the Investment Management division in fiscal 2023-2024. The Summary Report is intended as a resource for... **Content:** The Ontario Securities Commission (OSC) recently published its *Summary Report for Investment Fund and Structured Product Issuers* (The Summary Report), which provides an overview of key activities undertaken by the Investment Management division in fiscal 2023-2024. The Summary Report is intended as a resource for investment fund managers and entities performing services on their behalf, and other stakeholders, including investors. Highlights from the Investment Management division, formerly the Investment Funds and Structured Products Branch, include: - **Operational Highlights** – the volume of prospectus reviews and exemptive relief applications remained stable while continuous disclosure reviews continued to increase. These reviews primarily focused on fair disclosure practices to ensure investors are given accurate information and covered areas such as environmental, social and governance funds and reviews of marketing materials and yield disclosure. - **Regulatory Policy Initiatives** – the Investment Management division continued to work on rule proposals and amendments that align with our commitment to reducing regulatory burden and streamlining regulation while maintaining investor protection. - **Emerging Issues and Initiatives** – key initiatives impacting the investment funds industry include the launch of SEDAR+ and the cessation of the Canadian Dollar Offered Rate. The Investment Fund Survey continues to be a critical data-gathering tool and has undergone some changes to streamline it with other regulatory filings and expand the scope of data collected. *The Summary Report for Investment Fund and Structured Product Issuers* [ is available for download](//www.osc.ca/en/securities-law/instruments-rules-policies/2/21-329/joint-canadian-securities-administratorsinvestment-industry-regulatory-organization-canada-staff) from the website of the Ontario Securities Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CSA Proposes Amendments And Changes To Implement An Access Model For Certain Continuous Disclosure Documents Of Non-Investment Fund Reporting Issuers](https://baxsecuritieslaw.com/csa-proposes-amendments-and-changes-to-implement-an-access-model-for-certain-continuous-disclosure-documents-of-non-investment-fund-reporting-issuers/) **Published:** November 21, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) is publishing for a 90-day comment period ending February 17, 2024, proposed amendments to: National Instrument 51-102 Continuous Disclosure Obligations (proposed amendments to NI 51-102) and proposed changes to: Companion Policy 51-102CP Continuous Disclosure Obligations, and Companion Policy 54-101CP to... **Content:** The Canadian Securities Administrators (CSA) is publishing for a 90-day comment period ending **February 17, 2024**, proposed amendments to: - *National Instrument 51-102 Continuous Disclosure Obligations* (proposed amendments to NI 51-102) and proposed changes to: - *Companion Policy 51-102CP Continuous Disclosure Obligations*, and - *Companion Policy 54-101CP to National Instrument 54-101 Communication with Beneficial Owners of Securities of a Reporting Issuer* (collectively, the Proposed Changes) and are publishing for comment, related proposed consequential amendments to: - *National Instrument 54-101 Communication with Beneficial Owners of Securities of a Reporting Issuer* (collectively, with proposed amendments to NI 51-102, the Proposed Amendments). Upon implementation, the Proposed Amendments and the Proposed Changes will introduce an access model for annual financial statements, interim financial reports and related management’s discussion & analysis (MD&A) for non-investment fund reporting issuers (the Proposed Access Model). The Proposed Access Model aims to modernize the way documents are made available to investors by allowing issuers to provide investors with electronic access to certain continuous disclosure documents, without impacting investors’ ability to request, or provide standing instructions to receive, those documents in electronic or paper form. It will give issuers another alternative to sending annual financial statements, interim financial reports and related MD&A, instead of following the current requirements found in securities legislation. The Proposed Access Model [ is available for download](https://www.securities-administrators.ca/investor-tools/proposed-access-model-for-certain-continuous-disclosure-documents-of-corporate-issuers/) from the website of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Propose Amendments To Multilateral Instrument 13-102 System Fees](https://baxsecuritieslaw.com/canadian-securities-regulators-propose-amendments-to-multilateral-instrument-13-102-system-fees/) **Published:** November 25, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published for comment proposed amendments (the Proposed Amendments) to Multilateral Instrument 13-102 System Fees for a 90-comment period ending February 19, 2025. The Proposed Amendments would see system fees for SEDAR+ and the National Registration Database (NRD) increased over... **Content:** The Canadian Securities Administrators (CSA) has published for comment proposed amendments (the Proposed Amendments) to [Multilateral Instrument 13-102 *System Fees*](https://www.osc.ca/en/securities-law/instruments-rules-policies/1/13-102/multilateral-instrument-13-102-system-fees) for a 90-comment period ending **February 19, 2025.** The Proposed Amendments would see system fees for SEDAR+ and the National Registration Database (NRD) increased over five years, starting in late 2025. The system fee would increase by 60 per cent in November 2025 and by three per cent each of the following four years. The regulator says the system fee increases are necessary to ensure sufficient funding to operate the CSA’s national systems like SEDAR+ and the NRD. Under the Proposed Amendments the total system fees collected by the CSA would increase, however no new system fees would be introduced, and the flat-fee structure would be retained. The regulator also believes that since system fees are based on the type and number of filings submitted and the number of individual registrants, the proportional fee increases would equitably impact all market segments. *CSA Notice and Request for Comment – Proposed Amendments to Multilateral Instrument 13-102 System Fees* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/1/13-102/csa-notice-and-request-comment-proposed-amendments-multilateral-instrument-13-102-system-fees) from the websites of the participating jurisdictions. **Note:** The BC Securities Commission (BCSC) is not publishing the Proposed Amendments and changes for comment while it awaits necessary government approvals following the B.C. provincial election. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Publish Proposed Changes To Principal Distributor Model For Review And Comment](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-proposed-changes-to-principal-distributor-model-for-review-and-comment/) **Published:** December 5, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) are publishing a series of proposed amendments and changes to the principal distributor model in the distribution of mutual funds (the Proposed Amendments and Proposed Changes) for a 90-day comment period ending February 27, 2025. Collectively, the Proposed Amendments are... **Content:** The Canadian Securities Administrators (CSA) are publishing a series of proposed amendments and changes to the principal distributor model in the distribution of mutual funds (the Proposed Amendments and Proposed Changes) for a 90-day comment period ending February 27, 2025*.* Collectively, the Proposed Amendments are to: - National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103); - National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101); - National Instrument 81-102 Investment Funds (NI 81-102); and, - National Instrument 81-105 Mutual Fund Sales Practices (NI 81-105). Collectively the Proposed Changes are to: - Companion Policy 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (31-103CP); - Companion Policy 81-102 Investment Funds (81-102CP); and, - Companion Policy 81-105 Mutual Fund Sales Practices (81-105CP*).* The Proposed Amendments and Proposed Changes address the principal distributor model for mutual funds, clarifying that a principal distributor may only act for mutual funds in the same mutual fund family. The Proposed Amendments and Proposed Changes require disclosure of principal distributor arrangements and compensation and ensure that the DSC option (Deferred Sales Charge Option) where the investor did not pay an initial sales charge for purchased fund securities but paid a redemption fee to the manager, is not available to investors purchasing mutual fund securities distributed by principal distributors. The CSA is also consulting on: - whether there are circumstances in which a principal distributor should be allowed to have multiple relationships; and, - how dealers are using chargebacks when distributing mutual funds. The regulator believes using chargebacks represents a significant conflict of interest. The Proposed Amendments and Proposed Changes [ *are available for download*](https://www.osc.ca/en/securities-law/instruments-rules-policies/3/31-103/csa-notice-and-request-comment-proposed-amendments-ni-31-103-ni-81-101-ni-81-102-and-ni-81-105-and) from the websites of the securities regulators of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, and Nova Scotia, Newfoundland and Labrador, Yukon and the Northwest Territories. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators To Provide Temporary Relief From Requirements For Delivering Proxy- Related Material](https://baxsecuritieslaw.com/canadian-securities-regulators-to-provide-temporary-relief-from-requirements-for-delivering-proxy-related-material/) **Published:** December 5, 2024 **Author:** Barbara Hendrickson **Excerpt:** In response to the current Canadian postal strike, the Canadian Securities Administrators (CSA) is providing temporary relief from requirements to deliver proxy-relate material for annual meetings through a temporary exemption from certain requirements in National Instrument 51-102 Continuous Disclosure Requirements and National Instrument and 54-101... **Content:** In response to the current Canadian postal strike, the Canadian Securities Administrators (CSA) is providing temporary relief from requirements to deliver proxy-relate material for annual meetings through a temporary exemption from certain requirements in National Instrument 51-102 *Continuous Disclosure Requirements* and National Instrument and 54-101 *Communications with Beneficial Owners of Securities of a Reporting Issuer (the Coordinated Blanket Order).* The conditions in the Coordinated Blanket Order will include a requirement that all matters at the meeting are matters routinely submitted to an annual meeting, such as receiving and considering financial statements, fixing the number of directors to be elected and electing directors, and appointing auditors, among other matters. The order will not extend to matters requiring a special resolution under corporate law and the shareholder meeting must not, to the issuer’s knowledge, include a contested matter or a matter that a shareholder would reasonably consider to be contentious. In addition, reporting issuers relying on the temporary exemption must ensure proxy-related materials are filed on SEDAR+ and the reporting issuer’s website, and issue a news release about the shareholder meeting, including how shareholders can access materials and submit voting instructions. It should be noted that the Coordinated Blanket Order will address requirements under securities legislation only and will not extend to delivery obligations under corporate law. The CSA expects that reporting issuers, intermediaries and all other parties involved in the proxy-voting process will work collaboratively during the postal service suspension and take all reasonable steps to facilitate the voting process. This includes using alternate delivery methods where available and taking other measures to increase transparency to shareholders regarding how to access proxy materials, obtain individual control numbers and vote. Issuers or shareholders who have questions about the order, including questions related to potential relief for a special meeting, should contact their local regulatory authority. *National Instrument 51-102 Continuous Disclosure Requirements and National Instrument 54-101 Communication with Beneficial Owners of Securities of a Reporting Issuer to Send Certain Proxy-Related Materials During a Postal Strike* [ is available for download](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/5-ongoing-requirements-for-issuers-insiders/current/51-931/51931-csa-notice-december-4-2024) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Canadian Securities Regulators Publish Summary Of 2024 Systemic Risk Survey Results](https://baxsecuritieslaw.com/canadian-securities-regulators-publish-summary-of-2024-systemic-risk-survey-results/) **Published:** December 5, 2024 **Author:** Barbara Hendrickson **Excerpt:** According to results of the third annual systemic risk survey (The Survey) recently published by Canadian Securities Administrators (CSA), Canadian investment dealers and portfolio managers are less concerned about Canadian financial stability than last year. The Survey was completed by 536 Canadian portfolio managers and investment... **Content:** According to results of the third annual systemic risk survey (The Survey) recently published by Canadian Securities Administrators (CSA), Canadian investment dealers and portfolio managers are less concerned about Canadian financial stability than last year. The Survey was completed by 536 Canadian portfolio managers and investment dealers between October 10 and November 4, 2024. The results of the Survey provide the CSA with important information on market participants’ views about the stability of the Canadian financial system. According to The Survey, in 2024 market participants seemed less concerned about interest rate levels. A likely key factor to this change was the recent and expected reductions in interest rates. Their main concerns at the time of the survey were household debt, cyber vulnerabilities, the geopolitical environment, and the housing market. Key takeaways include: - Respondents are generally less concerned about financial stability risks than last year. Less than 60% of respondents reported they were Somewhat Concerned to Very Concerned about the stability of the Canadian financial system, a decrease of six percentage-points from a year ago; - Respondents were most concerned about household debt, cyber vulnerabilities, the geopolitical environment, and the housing market; - Concern over interest rates dropped sharply from 68% of respondents last year to 27% this year; and, - In a new category, 48% of respondents thought that Artificial Intelligence posed a moderate level of risk to the financial system. *The 2024 CSA Systemic Risk Survey Summary* [is available for download](https://www.securities-administrators.ca/resources/csa-surveys/2024-csa-systemic-risk-survey-2/) from the websites of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law Announces December Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-december-toronto-business-lawyers-association-monthly-meeting/) **Published:** December 10, 2024 **Author:** Barbara Hendrickson **Excerpt:** Toronto, December 7, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings.  Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues... **Content:** Toronto, December 7, 2024: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings. Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues to the next meeting on Thursday December 19, 2024, at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson over eight years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together regularly for business and professional development purposes. The TBLA meetings are held once a month at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. The next monthly meeting is at 8:30 am on December 19, 2024, at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . For more information on the TBLA and its events please contact Barbara at ([www.baxsecuritieslaw.com](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001Wc_Ki0i15qqm3dJpfIn-pRnPJobgrBdU52pUd4HwXdW3Vmo0OJZdWIPR8HbWIyxFwkp8xWJ4qyWRRGQPJtz1i93SBGbCfYZiKrQlmA1zHodc8h5Xcj1KDrP7kLODsC-nG9csK7HA3lqIv2eswnlAbcL94IcXF1My&c=ahvwTNo6fGBZ36Ejof00cKXyp0kLCFVOL4VLWCBzEVlpCdojA91Oww==&ch=mfZZ_AyQedktYs3yY2vz0a1eeJD1Mjv50foCLHcQiKHO6OqJtLAGXw==)) **Categories:** News & Updates --- ### [Canadian Securities Administrators Issue Guidance And Open Consultations On Use Of AI Systems In Capital Markets](https://baxsecuritieslaw.com/canadian-securities-administrators-issue-guidance-and-open-consultations-on-use-of-ai-systems-in-capital-markets/) **Published:** December 10, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have published CSA Staff Notice and Consultation 11-348 – Applicability of Canadian Securities Laws and the Use of Artificial Intelligence Systems in Capital Markets (the Staff Notice), intended to provide guidance on how securities legislation applies to the use of... **Content:** The Canadian Securities Administrators (CSA) have published *CSA Staff Notice and Consultation 11-348 – Applicability of Canadian Securities Laws and the Use of Artificial Intelligence Systems in Capital Markets* (the Staff Notice), intended to provide guidance on how securities legislation applies to the use of artificial intelligence (AI) by market participants. Through the Staff Notice, the CSA is also seeking stakeholder feedback through consultation questions on the evolving role of AI systems and the opportunities to tailor or modify current approaches to oversight and regulation. The comment period ends on **March 31, 2025.** The Staff Notice is divided into three parts: - An introduction detailing general overarching themes that apply to the use of AI systems in capital markets across market participants. - A section providing the Regulator’s guidance, referring to specific securities laws and how they apply to registrants, non-reporting issuers, marketplaces and marketplace participants, clearing agencies and matching service utilities, trade repositories, designated rating organizations and designated benchmark administrators that use AI systems in Canadian capital markets. - A concluding section that includes the consultation questions to seek feedback from our stakeholders on the use of AI systems in capital markets. With the publication of the Staff Notice, the regulator recognizes the importance of harmonizing its approaches to AI systems, providing market participants with greater regulatory certainty and to ease the regulatory and compliance burdens. The CSA is working with provincial and international regulatory bodies to monitor legislative and policy efforts related to AI and their impact on market participants. The regulator notes it will continue to identify and consider new use cases of AI systems in the capital markets as they evolve and work towards mitigating any associated risks. *CSA Staff Notice and Consultation 11-348 – Applicability of Canadian Securities Laws and the Use of Artificial Intelligence Systems in Capital Markets* [ is available for download](https://www.osc.ca/en/securities-law/instruments-rules-policies/1/11-348/csa-staff-notice-and-consultation-11-348-applicability-canadian-securities-laws-and-use-artificial) from the website of the Canadian Securities Administrators. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [CIRO Publishes Request for Comment - Proposal to harmonize CIRO Continuing Education (CE) Programs](https://baxsecuritieslaw.com/ciro-publishes-request-for-comment-proposal-to-harmonize-ciro-continuing-education-ce-programs/) **Published:** December 22, 2024 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Investment Regulatory Organization (CIRO) has published proposed amendments to its continuing education (CE) programs under the Investment Dealer Partial Consolidated (IDPC) Rules and the Mutual Fund Dealer (MFD) Rules (The Proposed Amendments). CIRO had published the Proposed Amendments as part of its effort... **Content:** The Canadian Investment Regulatory Organization (CIRO) has published proposed amendments to its continuing education (CE) programs under the Investment Dealer Partial Consolidated (IDPC) Rules and the Mutual Fund Dealer (MFD) Rules (The Proposed Amendments). CIRO had published the Proposed Amendments as part of its effort to develop harmonized Continuing Education (CE) rules for a comment period ending March 18, 2025. Generally, the Proposed Amendments cover: - material differences between the IDPC and MFD Rules for CE, - the objectives of the current MFD and IDPC CE programs, which is to further develop baseline proficiencies applicable to Approved Persons consistent with the proficiency principle, - the objectives of CE harmonization and applicable regulatory requirements, including those specific to Quebec, and, - the potential operational and IT system impacts of harmonized rules on all CIRO firm types. The regulator plans to adopt a phased approach to harmonizing its CE rules. Phase One will focus on proposed rule amendments for the next CE cycle that have a minimal impact on firms and Approved Persons in the next CE cycle. Phase Two will consider future rule amendments that have significant operational and/or IT system impacts, which would take place in the following CE cycle. *Rule Amendments – Request for Comments — Proposal to harmonize CIRO Continuing Education (CE) Programs* [ is available for download](https://www.ciro.ca/news-room/publications/rule-amendments-request-comments-proposal-harmonize-ciro-continuing-education-ce-programs) from the website of the Canadian Investment Regulatory Organization For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law Announces January Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-january-toronto-business-lawyers-association-monthly-meeting/) **Published:** January 10, 2025 **Author:** Barbara Hendrickson **Excerpt:** Toronto, January 10, 2025: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings.  Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and... **Content:** Toronto, January 10, 2025: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings. Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues to the next meeting on Thursday January 16, 2025, at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson over eight years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together regularly for business and professional development purposes. The TBLA meetings are held once a month at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. The next monthly meeting is at 8:30 am on **January 16, 2025,** at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . For more information on the TBLA and its events please contact Barbara at ([www.baxsecuritieslaw.com](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001Wc_Ki0i15qqm3dJpfIn-pRnPJobgrBdU52pUd4HwXdW3Vmo0OJZdWIPR8HbWIyxFwkp8xWJ4qyWRRGQPJtz1i93SBGbCfYZiKrQlmA1zHodc8h5Xcj1KDrP7kLODsC-nG9csK7HA3lqIv2eswnlAbcL94IcXF1My&c=ahvwTNo6fGBZ36Ejof00cKXyp0kLCFVOL4VLWCBzEVlpCdojA91Oww==&ch=mfZZ_AyQedktYs3yY2vz0a1eeJD1Mjv50foCLHcQiKHO6OqJtLAGXw==)) **Categories:** News & Updates --- ### [CSA Publishes Notice And Request For Comment On Proposed Amendments To Trading Fee Caps Charged By Marketplaces](https://baxsecuritieslaw.com/csa-publishes-notice-and-request-for-comment-on-proposed-amendments-to-trading-fee-caps-charged-by-marketplaces/) **Published:** January 27, 2025 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) has published a Notice and Request for Comment on proposed amendments to National Instrument 23-101 Trading Rules (Proposed Amendments) and proposed changes to Companion Policy 23-101 Trading Rules (Proposed CP Changes) related to the recent rule changes announced by the... **Content:** The Canadian Securities Administrators (CSA) has published a Notice and Request for Comment on proposed amendments to *National Instrument 23-101 Trading Rules* (Proposed Amendments) and proposed changes to *Companion Policy 23-101 Trading Rules* (Proposed CP Changes) related to the recent rule changes announced by the United States Securities and Exchange Commission (SEC). The comment period will run for 60 days and close on March 24, 2025. The Proposed Amendments and Proposed CP Changes ensure trading in Canadian securities that are inter-listed on U.S.-registered national securities exchanges (U.S. Inter-listed Securities) remains competitive. If adopted, alignment of the Canadian trading fee cap with the fee cap in the United States would continue for U.S. Inter-listed Securities priced at CAD 1.00 or more. The Proposed Amendments and Proposed CP Changes follow the SEC announcement of its final rules on September 18, 2024, specifically (i) reduced trading fee caps for National Market System (NMS) stocks and, (ii) reduced minimum pricing increments for certain NMS stocks priced at USD 1.00 or more per share (together, SEC Final Rules). On December 12, 2024, the Canadian Investment Regulatory Organization published proposed amendments to the Universal Market Integrity Rules (Proposed UMIR Amendments) that, if adopted, would conform the minimum pricing increments with the SEC Final Rules for U.S. Inter-listed Securities priced at CAD 1.00 or more per share. The comment period to solicit feedback on the Proposed UMIR Amendments will close on January 27, 2025. The planned implementation date for the SEC Final Rules was November 3, 2025, however, on December 12, 2024, the SEC issued an order staying the implementation of the SEC Final Rules pending completion of judicial review of those rules. The Proposed Amendments, Proposed CP Changes and Proposed UMIR Amendments would not be implemented in Canada before the SEC Final Rules are implemented in the U.S. *CSA Notice and Request for Comment – Proposed Amendments to National Instrument 23-101 Trading Rules and Proposed Changes to Companion Policy 23-101 Trading Rules*[*)* is available for download](https://www.bcsc.bc.ca/securities-law/law-and-policy/instruments-and-policies/2-certain-capital-market-participants/current/23-101/23101-csa-notice-and-request-for-comment-january-23-2025) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law Announces February Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-february-toronto-business-lawyers-association-monthly-meeting/) **Published:** January 28, 2025 **Author:** Barbara Hendrickson **Excerpt:** Toronto, January 27, 2025: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings.  Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and... **Content:** Toronto, January 27, 2025: BAX Securities Law is pleased to announce that the firm has resumed its sponsorship of the Toronto Business Lawyers Association (TBLA) networking and business development monthly meetings. Barbara Hendrickson, Managing Partner of BAX Securities Law, is pleased to invite friends and colleagues to the next meeting on Thursday February 20, 2025, at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson over eight years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together regularly for business and professional development purposes. The TBLA meetings are held once a month at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. The next monthly meeting is at 8:30 am on **February 20, 2025,** at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . For more information on the TBLA and its events please contact Barbara at ([www.baxsecuritieslaw.com](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001Wc_Ki0i15qqm3dJpfIn-pRnPJobgrBdU52pUd4HwXdW3Vmo0OJZdWIPR8HbWIyxFwkp8xWJ4qyWRRGQPJtz1i93SBGbCfYZiKrQlmA1zHodc8h5Xcj1KDrP7kLODsC-nG9csK7HA3lqIv2eswnlAbcL94IcXF1My&c=ahvwTNo6fGBZ36Ejof00cKXyp0kLCFVOL4VLWCBzEVlpCdojA91Oww==&ch=mfZZ_AyQedktYs3yY2vz0a1eeJD1Mjv50foCLHcQiKHO6OqJtLAGXw==)) **Categories:** News & Updates --- ### [Strengthening American Leadership in Digital Financial Technology](https://baxsecuritieslaw.com/strengthening-american-leadership-in-digital-financial-technology/) **Published:** January 31, 2025 **Author:** Barbara Hendrickson **Excerpt:** A recent Executive Order issued by U.S. President Donald Trump signals a dramatic shift to pro-cryptocurrency policies. The Executive Order, Strengthening American Leadership in Digital Financial Technology Strengthening American Leadership in Digital Financial Technology (The Executive Order), takes a multi-pronged approach, including but not limited... **Content:** A recent Executive Order issued by U.S. President Donald Trump signals a dramatic shift to pro-cryptocurrency policies. The Executive Order, *Strengthening American Leadership in Digital Financial Technology Strengthening American Leadership in Digital Financial Technology* (The Executive Order), takes a multi-pronged approach, including but not limited to: - development of an open public blockchain network, including the ability to develop and deploy software; - banning Central Bank Digital Currencies (CBDC); - promoting the development and growth of U.S. dollar-backed stablecoins; and, - providing regulatory clarity certainty based on technology-neutral regulation. The Executive Order establishes the President’s Working Group on Digital Asset Markets (the Working Group), composed of cabinet-level appointees. The Working Group will propose a Federal regulatory framework governing the issuance and operation of digital assets, including stablecoins, in the United States. The Executive order lays out two significant deadlines for the Working Group, the first, within sixty (60) days of the Executive Order, each member agency the Working Group shall submit its recommendations to the Working Group Chair; and the second, within one hundred eighty (180) days of the Executive Order, Working Group shall submit a report to the President. *Strengthening American Leadership in Digital Financial Technology* [ is available for download](https://www.whitehouse.gov/presidential-actions/2025/01/strengthening-american-leadership-in-digital-financial-technology/) from the White House website. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Securities Law Considerations in Private Company Transactions](https://baxsecuritieslaw.com/securities-law-considerations-in-private-company-transactions/) **Published:** January 31, 2025 **Author:** Barbara Hendrickson **Excerpt:** BAX Securities Law is consistently recognized as one of Canada’s leading boutique capital markets firms and has earned a Best Law Firm designation from Best Lawyers, one of the world’s leading legal publications. Our clients include domestic and international corporations, entrepreneurial and growth-oriented businesses and... **Content:** BAX Securities Law is consistently recognized as one of Canada’s leading boutique capital markets firms and has earned a Best Law Firm designation from Best Lawyers, one of the world’s leading legal publications. Our clients include domestic and international corporations, entrepreneurial and growth-oriented businesses and financial institutions engaged in capital markets activities in Canada. Over the years our focus has pivoted to providing advice to market participants raising capital in the private markets. [Please see the attached presentation which focuses on securities laws applicable to private company transactions.](https://baxsecuritieslaw.com/wp-content/uploads/2025/02/February-1-2025-Private-Company-Transactions.pptx) For more information about our services please contact please call Barbara Hendrickson at (647) 403-4606 or . 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. **Categories:** News & Updates --- ### [Update on the CSA Project to Modernize Mineral Disclosure Requirements](https://baxsecuritieslaw.com/update-on-the-csa-project-to-modernize-mineral-disclosure-requirements/) **Published:** February 24, 2025 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) are proposing to repeal and replace the current National Instrument 43-101 Standards of Disclosure for Mineral Projects (the Instrument) and Form 43-101F1 Technical Report (the Form) with a streamlined instrument and Form (The Modernized Disclosure Requirements). The regulator is also... **Content:** The Canadian Securities Administrators (CSA) are proposing to repeal and replace the current *National Instrument 43-101 Standards of Disclosure for Mineral Projects* (the Instrument) and *Form 43-101F1 Technical Repo*rt (the Form) with a streamlined instrument and Form (The Modernized Disclosure Requirements). The regulator is also proposing to rescind and replace the current *Companion Policy 43-101CP to National Instrument 43-101 Standards of Disclosure for Mineral Project*s (the Companion Policy) with a new companion policy. The Modernized Disclosure Requirements, as defined below, are intended to modernize and streamline Canada’s mining disclosure regime and continue to protect investors, without imposing an undue regulatory burden on market participants. The Modernized Disclosure Requirements will include the following: - proposed National Instrument 43-101 *Standards of Disclosure for Mineral Projects* (the Proposed NI 43-101) and Form 43-101F1 *Technical Report* (the Proposed Form), including a repeal of the Instrument and the Form; - proposed Companion Policy 43-101CP to National Instrument 43-101 *Standards of* *Disclosure for Mineral Projects* (the **Proposed Companion Policy**), including a rescission of the Companion Policy; - proposed consequential amendments to existing rules: - National Instrument 44-101 *Short Form Prospectus Distributions*; - National Instrument 44-102 *Shelf Distributions*; - Form 45-106F3 *Offering Memorandum for Qualifying Issuers*; - Form 51-102F2 *Annual Information Form*; - Multilateral Instrument 51-105 *Issuers Quoted in the U.S. Over-the-Counter Markets*; and, - proposed consequential changes to Companion Policy 51-105CP to Multilateral Instrument - 51-105 *Issuers Quoted in the U.S. Over-the-Counter Markets* (The proposed text of *Update on the CSA Project to Modernize Mineral Disclosure Requirements)* [ is available for download](https://www.bcsc.bc.ca/securities-law/law-and-policy/bc-notices/current/bcn-202501-february-13-2025) from the websites of the participating jurisdictions. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law Announces March Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-march-toronto-business-lawyers-association-monthly-meeting/) **Published:** March 4, 2025 **Author:** Barbara Hendrickson **Excerpt:** Toronto, March 4, 2025: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday March 20, 2025, at 8:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was... **Content:** Toronto, March 4, 2025: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday March 20, 2025, at **8:30** am at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson, founder of BAX Securities Law, over ten years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together for business and professional development purposes. Please attend our March meeting where Barbara Hendrickson aka Stina Hemming will be handing out free copies of her book **Death Fund** recently reviewed in the CBA National Magazine. . Please also check out the buy recommendation from Kirkus Reviews: If you can’t come on the 20th, the book is for sale on Amazon: The TBLA meetings are held once a month at **8:30** am at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. The next monthly meeting is at **8:30** am on **March 20, 2025,** at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . **Categories:** News & Updates --- ### [Amendments to National Instrument 41-101 General Prospectus Requirements & National Instrument 81-101 Mutual Fund Prospectus Disclosure](https://baxsecuritieslaw.com/amendments-to-national-instrument-41-101-general-prospectus-requirements-national-instrument-81-101-mutual-fund-prospectus-disclosure/) **Published:** March 6, 2025 **Author:** Barbara Hendrickson **Excerpt:** The Canadian Securities Administrators (CSA) have announced the final amendments (Amendments) to National Instrument 41-101 General Prospectus Requirements (NI 41-101) and National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101). The Amendments extend the lapse date for investment funds in continuous distribution from 12 months... **Content:** The Canadian Securities Administrators (CSA) have announced the final amendments (Amendments) to *National Instrument 41-101 General Prospectus Requirements* (NI 41-101) and *National Instrument 81-101 Mutual Fund Prospectus Disclosure* (NI 81-101). The Amendments extend the lapse date for investment funds in continuous distribution from 12 months to 24 months, which will allow investment funds in continuous distribution to file their pro forma prospectuses biennially, rather than annually, and repeal the requirement to file a final prospectus no more than 90 days after the issuance of a receipt for a preliminary prospectus for all investment funds. The Amendments will modernize the prospectus filing model for investment funds, with a particular focus on investment funds in continuous distribution. The CSA’s modernization will better reflect the shift from the delivery of the prospectus to the delivery of the Fund Facts and ETF Facts to investors and reduce unnecessary regulatory burden imposed by the current prospectus filing requirements under securities legislation on investment funds without affecting the currency or accuracy of the information available to investors to make an informed investment decision. The fund facts document (**Fund Facts**) and the ETF facts document (**ETF Facts**) will continue to be filed annually and will continue to be delivered to investors under the current delivery requirements. *National Instrument 81-101 Mutual Fund Prospectus Disclosure* is available for download on the Ontario Securities Commission (OSC) website [https://www.osc.ca/sites/default/files/2025-03/ni\_20250303\_81-101\_unofficial-consolidation.pdf](https://www.osc.ca/sites/default/files/2025-03/ni_20250303_81-101_unofficial-consolidation.pdf) *National Instrument 41-101 General Prospectus Requirements* is available for download on the OSC website [https://www.osc.ca/sites/default/files/2025-03/ni\_20250303\_41-101\_unofficial-consolidation.pdf](https://www.osc.ca/sites/default/files/2025-03/ni_20250303_41-101_unofficial-consolidation.pdf) For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Meme Coins not Securities: SEC](https://baxsecuritieslaw.com/meme-coins-not-securities-sec/) **Published:** March 11, 2025 **Author:** Barbara Hendrickson **Excerpt:** The United States Securities and Exchange Commission’s (SEC) Division of Corporation Finance has ruled that Meme coins are not securities. In its recently published Staff Statement on Meme Coins (the Staff Statement), the regulator noted persons who participate in the offer and sale of meme... **Content:** The United States Securities and Exchange Commission’s (SEC) Division of Corporation Finance has ruled that Meme coins are not securities. In its recently published *Staff Statement on Meme Coins* (the Staff Statement), the regulator noted persons who participate in the offer and sale of meme coins do not need to register their transactions with the Commission under the Securities Act of 1933 (“Securities Act”) or fall within one of the Securities Act’s exemptions from registration. Accordingly, neither meme coin purchasers nor holders are protected by the federal securities laws. According to SEC, A meme coin is a crypto token inspired by internet memes, characters, current events, or trends for which the promoter seeks to attract an enthusiastic online community to purchase the meme coin and engage in its trading. Although individual meme coins may have unique features, meme coins typically share certain characteristics. Further and according to the SEC, Meme coins typically are purchased for entertainment, social interaction, and cultural purposes, and their value is driven primarily by market demand and speculation. In this regard, meme coins are akin to collectibles. Meme coins also typically have limited or no use or functionality. As the tokens are not sold as part of an investment contract, meme coins do not meet the Howey Test as set forth under *SEC v. W.J. Howey Co. (1946)* and would not be classed as securities. *The SEC Staff Statement on Meme Coins* [ is available for download](https://www.sec.gov/newsroom/speeches-statements/staff-statement-meme-coins#_ftn2) from the websites of the Securities and Exchange Commission. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [Barbara Hendrickson Honored as a Lexpert-Ranked Lawyer in the 2025 Canadian Legal Lexpert Directory](https://baxsecuritieslaw.com/barbara-hendrickson-honored-as-a-lexpert-ranked-lawyer-in-the-2025-canadian-legal-lexpert-directory/) **Published:** March 12, 2025 **Author:** Barbara Hendrickson **Excerpt:** Toronto, Ontario March 11, 2025: Barbara Hendrickson has been recognized as one of Canada’s Leading Legal Practitioners in the 2025 Canadian Legal Lexpert Directory. This prestigious accolade is the result of an extensive peer-review process that identifies top legal professionals across the country. This distinction... **Content:** ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/03/2025-Lexpert-Ranked-Laywer.png) Toronto, Ontario March 11, 2025: Barbara Hendrickson has been recognized as one of Canada’s Leading Legal Practitioners in the 2025 *Canadian Legal Lexpert Directory*. This prestigious accolade is the result of an extensive peer-review process that identifies top legal professionals across the country. This distinction reflects Barbara’s dedication to delivering exceptional legal services and advancing the profession through expertise and commitment. The Canadian Legal Lexpert Directory is the most comprehensive guide of legal talent in Canada. Published since 1997, the Directory profiles leading practitioners across Canada in over 60 practice areas. The rankings are determined through recommendations from law firm leaders and industry peers, acknowledging those who demonstrate excellence, leadership, and influence in their respective fields. **About BAX Securities Law** As a highly recommended boutique law firm, BAX Securities Law is where big firm expertise meets bespoke delivery of legal services. We are dedicated to excellence providing our clients with individualized services to shape their future success. For more information about BAX Securities Law and Barbara’s practice, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606 or email her at bhendrickson@baxsecuritieslaw.com. **Categories:** News & Updates --- ### [Effective Date For Delegation Of CIRO Registration Authority Announced](https://baxsecuritieslaw.com/effective-date-for-delegation-of-ciro-registration-authority-announced/) **Published:** April 9, 2025 **Author:** Barbara Hendrickson **Excerpt:** Effective April 1st, 2025, the securities regulatory authorities of Alberta, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island, and Yukon (the Participating Jurisdictions), have delegated certain registration functions and powers to the Canadian Investment Regulatory Organization (CIRO). The delegation... **Content:** Effective April 1st, 2025, the securities regulatory authorities of Alberta, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island, and Yukon (the Participating Jurisdictions), have delegated certain registration functions and powers to the Canadian Investment Regulatory Organization (CIRO). The delegation orders issued by the Participating Jurisdictions authorize CIRO to undertake the registration function for firms registered as, or applying for registration as, investment dealers, mutual fund dealers, and futures commission merchants (Ontario), and for the individuals who act on their behalf. They establish a consistent and harmonized approach to registration processes for CIRO members across the Participating Jurisdictions. Later in April, the Autorité des marchés financiers also expects to publish its delegation order for investment dealers, mutual fund dealers, and derivatives dealers in Québec, including the individuals who act on their behalf. The order is expected to be effective July 1, 2025. Provided the necessary approvals, delegation orders or rule amendments about their delegation of authority are obtained, the Financial and Consumer Affairs Authority of Saskatchewan, the Manitoba Securities Commission, and the British Columbia Securities Commission will proceed in due course with their delegations. Following delegation, the Participating Jurisdictions will focus on the increased oversight of CIRO, developing regulatory policy, addressing novel issues that may arise in applications, and granting exemptive relief applications as needed. Market participants and stakeholders can visit the [CIRO Delegation webpage on the CSA website](https://www.securities-administrators.ca/new-sro/ciro-delegation/) for more information. The website will be updated during the delegation process. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ### [BAX Securities Law Announces May Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-may-toronto-business-lawyers-association-monthly-meeting-3/) **Published:** May 9, 2025 **Author:** Barbara Hendrickson **Excerpt:** Toronto, May 8, 2025: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday May 15, 2025, at 9:30 am at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson,... **Content:** Toronto, May 8, 2025: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday May 15, 2025, at **9:30** **am** at Chefs Hall, 111 Richmond St. W in downtown Toronto (Lost Coffee area). The Toronto Business Lawyers Association was created by Barbara Hendrickson, founder of BAX Securities Law, over ten years ago to provide business lawyers in the small and mid-size law firm community with a forum in downtown Toronto to get together for business and professional development purposes. The TBLA meetings are held once a month at **9:30 am** at Chefs Hall, 111 Richmond St. W in downtown Toronto. The Association is open to all lawyers in solo, small and mid-size firms that practice in the business law area – tax, employment law, commercial real estate, franchises, securities, corporate, financial services. The next monthly meeting is at **9:30 am** on May 15, 2025, at Chefs Hall 111 Richmond St. W. If you would like to attend, please RSVP to Barbara Hendrickson – . For more information on the TBLA and its events please contact Barbara at ([www.baxsecuritieslaw.com](https://pt9zrwqab.cc.rs6.net/tn.jsp?f=001Wc_Ki0i15qqm3dJpfIn-pRnPJobgrBdU52pUd4HwXdW3Vmo0OJZdWIPR8HbWIyxFwkp8xWJ4qyWRRGQPJtz1i93SBGbCfYZiKrQlmA1zHodc8h5Xcj1KDrP7kLODsC-nG9csK7HA3lqIv2eswnlAbcL94IcXF1My&c=ahvwTNo6fGBZ36Ejof00cKXyp0kLCFVOL4VLWCBzEVlpCdojA91Oww==&ch=mfZZ_AyQedktYs3yY2vz0a1eeJD1Mjv50foCLHcQiKHO6OqJtLAGXw==)) **Categories:** News & Updates --- ### [Canadian Securities Regulators Announce Actions To Support Competitiveness Of Canadian Markets](https://baxsecuritieslaw.com/canadian-securities-regulators-announce-actions-to-support-competitiveness-of-canadian-markets/) **Published:** May 26, 2025 **Author:** Barbara Hendrickson **Excerpt:** In response to recent events, the Canadian Securities Administrators (CSA) is introducing measures to support market participants that choose to go public, maintain a listing, and contribute to capital formation in Canada through a series of Coordinated Blanket Orders (the Blanket Orders). A multi-faceted prospectus... **Content:** In response to recent events, the Canadian Securities Administrators (CSA) is introducing measures to support market participants that choose to go public, maintain a listing, and contribute to capital formation in Canada through a series of Coordinated Blanket Orders (the Blanket Orders). - A multi-faceted [prospectus and disclosure blanket order](https://www.securities-administrators.ca/news/canadian-securities-regulators-announce-actions-to-support-competitiveness-of-canadian-markets/#blanket) will reduce regulatory burden and provide greater flexibility for companies that are currently reporting, or that choose to pursue an initial public offering (IPO) in Canada. In response to stakeholder feedback, the blanket order expands to all companies, the existing exemption from the requirement to provide audited financial statements for the third most recently completed financial year in connection with IPOs and other transactions; - A [second blanket order ](https://www.securities-administrators.ca/news/canadian-securities-regulators-announce-actions-to-support-competitiveness-of-canadian-markets/#blanket)provides a prospectus exemption for companies that will be going or have recently gone public in Canada through an underwritten IPO, giving them greater flexibility to raise additional capital following the IPO provided certain conditions are met; and, - A [third blanket order](https://www.securities-administrators.ca/news/canadian-securities-regulators-announce-actions-to-support-competitiveness-of-canadian-markets/#blanket) that applies to the following jurisdictions Alberta, New Brunswick, Nova Scotia, Ontario, Québec and Saskatchewan. Under this blanket order, the investment limit in the offering memorandum exemption will increase for certain eligible investors to allow for reinvestment of proceeds within a 12-month period, subject to certain terms and conditions. There is no such limit in the other CSA jurisdictions. The Coordinated Blanket Orders became effective April 17, 2025. For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606. 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. **Categories:** News & Updates --- ## Pages ### [BAX Main Page](https://baxsecuritieslaw.com/) **Published:** December 14, 2016 **Author:** Ian **Content:** ![Corporate Business Lawyers - BAX Securities Law Logo](https://baxsecuritieslaw.com/wp-content/uploads/2026/01/BAX-Securities-Law-2.png) # **Award Winning Corporate Securities Law Firm** *Photo: Canada, Nunavut Territory* BAX Securities Law® is repeatedly recognized as one of Canada’s leading law firms and has earned rankings in Best Law Firms Canada compiled by Best Lawyers and in Canadian Lawyer Magazines Top Corporate Law Firms in Canada ![Best Law Firms in Canada 2026](https://baxsecuritieslaw.com/wp-content/uploads/2026/01/Website-Image-BEST-LAW-FIRM-2026-1-300x200.png) ![Barbara Hendrickson Best Laywers 2026](https://baxsecuritieslaw.com/wp-content/uploads/2026/01/best-lawyers-2026.png) ![Peer Rated for Professional Excellence in Corporate Securities Law](https://baxsecuritieslaw.com/wp-content/uploads/2025/03/PR_AV_300-1.png) ![Lexpert Ranked Corporate Securities Lawyer](https://baxsecuritieslaw.com/wp-content/uploads/2025/03/2025-Lexpert-Ranked-Laywer.png) ## Focusing on Corporate Securities and Financial Services We understand your legal business needs in today’s financial markets. BAX Securities Law® offers in-depth expertise. ### Capital Markets ### Capital Markets Our clients choose us for our extensive experience and knowledge in the capital raising and public company area ### Investment Funds ### Investment Funds Our clients choose us for our expert advice on a wide range of investment fund activities in a wide range of asset classes ### Corporate Finance & Securities ### Corporate Finance & Securities Senior lawyers providing assistance to financial services and capital markets clients ### Financial Services Regulation ### Financial Services Regulation The financial services industry in Canada is constantly adapting to a complex and ever-changing regulatory landscape. ### Corporate & Commercial ### Corporate & Commercial Assisting market and financial services participants with compliance audits and enforcement actions ### Securities Litigation, Enforcement And Compliance ### Securities Litigation, Enforcement And Compliance We advise market participants and respondents in response to allegations of market misconduct. ### Real Estate Syndication ### Real Estate Syndications AX has decades of experience structuring investment vehicles and raising capital in all major Canadian real estate markets. ### Crypto Assets ### Crypto Assets Bitcoin, Ethereum, non-fungible tokens (NFTs) and stablecoins have emerged as an alternative asset class. ## We understand your legal business needs in today’s financial markets. BAX Securities Law® offers in-depth expertise. - ### BAX Securities Law® specializes in high quality and efficient legal services BAX Securities Law® focuses on suggested solutions tailored to each client’s individual business needs. That focus, combined with decades of experience, allows us to provide creative solutions to our client’s complex legal issues. - ### BAX Securities Law® provides legal and regulatory advice We advise on various asset classes including equity, debt, commodities, derivatives, crypto assets, private equity, venture capital, real estate and mortgages including syndicated mortgages. - ### BAX Securities Law® advises in the Blockchain, FinTech and crypto asset sectors BAX Securities Law® has direct experience dealing with Canadian financial services regulatory bodies including FSRA, FINTRAC and OSFI and can assist with risk-management and compliance strategies. ![BAX Corporate Securities Lawyers in Toronto Canada](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/Untitled-design-5-1024x1024.png)**BAX Securities Law® Toronto Office** 30 St. Patrick Street Suite 700 Toronto, Ontario M5T 3A3 E: ## Get In Touch BAX Securities Law® is one of Canada’s leading corporate securities law firms. If you wish to discuss retaining BAX Securities Law® to provide you with legal services, please book a consultation or reach out via phone or email. Please enable JavaScript in your browser to complete this form. Name \* Email \* Name Email Message Message Submit![Loading](https://baxsecuritieslaw.com/wp-content/plugins/wpforms-lite/assets/images/submit-spin.svg) --- ### [Jordan Goddard](https://baxsecuritieslaw.com/jordan-goddard/) **Published:** August 10, 2026 **Author:** Barbara Hendrickson **Content:** ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/08/GettyImages-534969258.jpg) ## Jordan Goddard Marketing Specialist - [LinkedIn](https://www.linkedin.com/in/jordangoddard) ![](https://baxsecuritieslaw.com/wp-content/uploads/2026/08/Jordan_6-Cropped-White-Background-1.png)## Contact **Toronto Office** 30 St. Patrick Street Suite 700 Toronto ON M5T 3A3 E: [](mailto:j.goddard321@gmail.com) L: [www.linkedin.com/in/jordangoddard](http://linkedin.com/in/navraj-pannu-a8462911/) Jordan Goddard is a Marketing Specialist with BAX Securities Law® and has been contracted with the firm since it’s 2012 founding. He has built the BAX website and continues to maintain it along with all the firm’s branding. Jordan has over 10 years experience in video editing, graphic design and website building across multiple competitive industries, including finance and print. His creative expertise allows to BAX to maintain on steady online presence. ## **Education** - **Honours Bachelor of Arts (HBA.)**, Communication, Culture, and Information Technology, **Minor** in Professional Writing & Communication and Political Science, University of Toronto Mississauga (2011-2015) - **Certificate**, Digital Communication Technology, Sheridan College Oakville (2012-2014) --- ### [Barbara Hendrickson*](https://baxsecuritieslaw.com/bhendrickson/) **Published:** January 5, 2025 **Author:** Barbara Hendrickson **Content:** ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/08/GettyImages-534969258.jpg) ## ****Barbara Hendrickson**** [Download Vcard](https://baxsecuritieslaw.com/wp-content/uploads/2025/11/barb.vcf) [Download Profile](https://baxsecuritieslaw.com/wp-content/uploads/2025/11/barbara.pdf) - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/bhendrickson/) - [ ](https://twitter.com/share?text=Barbara%20Hendrickson*&url=https://baxsecuritieslaw.com/bhendrickson/) - [ ](https://www.linkedin.com/shareArticle?title=Barbara%20Hendrickson*&url=https://baxsecuritieslaw.com/bhendrickson/&mini=true) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/11/Barb-square.jpg) ## Contact **Toronto Office** 30 St. Patrick Street Suite 700 Toronto ON M5T 3A3 T: 416.601.1004 C: 647.403.4606 E: L: ![](https://baxsecuritieslaw.com/wp-content/uploads/2026/01/best-lawyers-2026.png) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/03/PR_AV_300-1.png) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/03/2025-Lexpert-Ranked-Laywer.png) Barbara has practiced in the securities and corporate areas for nearly 30 years, including with a leading international law firm, a leading national law firm, a Vancouver based boutique securities law firm, as senior legal counsel with the Ontario Securities Commission and, for the last 14 years, her own boutique law firm. As a former regulator and experienced securities lawyer, Barbara brings a special combination of skills and abilities to assist her clients. Barbara’s practice has a national and cross-border focus providing corporate finance and securities advice to public and private entities, advising them on capital raising, mergers & acquisitions, going public and going private transactions, take-over bids, corporate structuring, fund formation, debt & equity financing, corporate governance strategies and effective securities compliance programs. ## **Awards & Recognitions** Repeatedly recognized in the Canadian Legal Lexpert Directory as a leading lawyer in the area of Corporate Finance & Securities and most recently in the 2025 edition. The Directory recognizes leading legal practitioners across Canada based on an extensive peer survey process. Listed in the 2026 edition of *The Best Lawyers in Canada™*. The Best Lawyer awards are given to lawyers who, while demonstrating comprehensive expertise in their professional practices, have shown adaptability, ethics, and leadership. *The Best Lawyer* awards are seen as symbols of esteem and the recognition of integrity in the legal community. Consistently ranked as AV® Preeminent™ Peer Review Rated by Martindale-Hubbell, which is given to an elite group of attorneys who have been rated highly by their peers as having very high ethical standards and an A grade (4.5 or higher). Ranked by Law Day Leading Practitioners as one of the top 10 environmental finance lawyers in Canada. Recipient of the Women’s Law Association President’s Award, a prestigious award recognizing her substantial contribution and commitment to the promotion of women in law and as a leader in the legal profession. Recipient of a recognition award by the Prospectors and Developers Association of Canada (PDAC) for her contribution as a board member and securities committee member of PDAC. Recipient of the prestigious Arbor Award for her contributions to the University of Toronto in the carbon and environmental finance areas. ## **Professional Affiliations** Member of the British Columbia Fintech Advisory Forum, a forum sponsored by the British Columbia Securities Commission to discuss and provide input on Fintech and digital asset innovations and related regulatory issues. Member of the Ontario Bar Association Securities Committee. Listed in the Ontario Securities Commission (OSC) Beta Innovation Office Directory. The Directory connects experienced law firms with the start-up and innovation community. See Listed in *The Ontario Lawyers Directory for Whistleblowers* (the Directory), published by Whistleblowing Canada. *The Ontario Lawyers Directory for Whistleblowers* can be accessed on the website of the [Whistleblowing Research Society](https://www.whistleblowingcanada.com/ontario_lawyers_directory_sub). Member of Lexis Nexis Practical Guidance Team in the area of Crypto assets. Founder of the Toronto Business Lawyers Association, a group of business lawyers in Toronto who practice in small firms and get together regularly for business development / referral services. See: [torontobusinesslawyers.org](https://baxsecuritieslaw.com/bhendrickson/torontobusinesslawyers.org). Past memberships include: - Member of the Small & Medium Enterprises Committee and the Securities Advisory Committee of OSC. - Co-chair of the OBA Securities Committee; Co-chair of the CBA Securities Committee; and chair of the CBA Business Law Section. - Board member of the Prospectors & Developers Association of Canada (“PDAC”) and past chair of its Securities Committee. - Trustee of OBA Foundation. The OBA Foundation is the charitable arm of the Ontario Bar Association. - Vice Chair of the Responsible Investment Committee of the University of Toronto and chair of its Proxy Voting Subcommittee. - Member of the Environmental Finance and Carbon Finance Advisory Committees of the University of Toronto. ## **Calls to the Bar** - Law Society of Ontario (1994) - Law Society of British Columbia (2010) --- ### [Navraj Pannu](https://baxsecuritieslaw.com/navraj-pannu/) **Published:** July 21, 2026 **Author:** Barbara Hendrickson **Content:** ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/08/GettyImages-534969258.jpg) ## ****Navraj Pannu**** - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/navraj-pannu/) - [ ](https://twitter.com/share?text=Navraj%20Pannu&url=https://baxsecuritieslaw.com/navraj-pannu/) - [ ](https://www.linkedin.com/shareArticle?title=Navraj%20Pannu&url=https://baxsecuritieslaw.com/navraj-pannu/&mini=true) ![](https://baxsecuritieslaw.com/wp-content/uploads/2026/07/Nav-Photo-Cropped-2.jpg)## Contact **Toronto Office** 30 St. Patrick Street Suite 700 Toronto ON M5T 3A3 T: 416.601.1004 E: L: [linkedin.com/in/navraj-pannu](http://linkedin.com/in/navraj-pannu-a8462911/) Navraj is a corporate, commercial and securities lawyer with experience guiding businesses through complex regulatory landscapes, strategic transactions, and critical growth phases. His practice spans the full spectrum of corporate commercial law, mergers and acquisitions (M&A), corporate finance, and capital markets. Nav acts as a trusted strategic advisor to small and medium-sized enterprises, entrepreneurs, and emerging issuers. He specializes in structuring public and private financings, navigating M&A, and ensuring seamless compliance with continuous disclosure and corporate governance standards. Known for his practical, business-first approach, Nav translates intricate legal frameworks into clear, actionable strategies that protect value and accelerate growth. Whether advising a growing business on foundational commercial agreements, steering a company through a pivotal transaction, or counselling boards on shifting governance mandates, he brings the calibre of big-firm expertise with the agility, responsiveness, and personal attention that clients need. ## **Professional Affiliations** - Toronto Business Lawyers Association (TBLA) ## **Call to the Bar** - Law Society of Ontario June 2015 --- ### [Janny Cho](https://baxsecuritieslaw.com/jcho/) **Published:** March 10, 2025 **Author:** Barbara Hendrickson **Content:** ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/08/GettyImages-534969258.jpg) ## ****Janny Cho**** [Download Vcard](https://baxsecuritieslaw.com/wp-content/uploads/2025/11/janny.vcf) [Download Profile](https://baxsecuritieslaw.com/wp-content/uploads/2025/11/janny2.pdf) - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/jcho/) - [ ](https://twitter.com/share?text=Janny%20Cho&url=https://baxsecuritieslaw.com/jcho/) - [ ](https://www.linkedin.com/shareArticle?title=Janny%20Cho&url=https://baxsecuritieslaw.com/jcho/&mini=true) ![](https://baxsecuritieslaw.com/wp-content/uploads/2026/05/Janny-New-AI-Image-500x600pixels.png)## Contact **Toronto Office** 30 St. Patrick Street Suite 700 Toronto ON M5T 3A3 T: 416.601.1004 E: [ ](mailto:bhendrickson@baxsecuritieslaw.com) L:[ https://www.linkedin.com/in/janny-cho-062489b6/](https://www.linkedin.com/in/janny-cho-062489b6/) Janny Cho is of counsel with BAX Securities Law® providing corporate finance securities and corporate commercial advice. Janny works with clients across a broad range of industries, at all stages of growth on capital raising and securities regulatory requirements. Janny’s practice focuses on assisting clients with structuring, capital raising, reorganizations, mergers and acquisitions and associated securities regulatory requirements. She represents issuers and investors in private offerings and advises on disclosure and corporate governance matters. Janny’s legal experience includes working with one of Canada’s largest national law firm as well as with a smaller boutique law firm. Janny is fluent in Cantonese and she has worked in Hong Kong, Japan and Singapore. ## **Professional Affiliations** - Federation of Asian Canadian Lawyers (FACL) - Ontario Bar Association (OBA) ## **Call to the Bar** - Law Society of Ontario (2002) --- ### [Consult](https://baxsecuritieslaw.com/consult/) **Published:** September 24, 2025 **Author:** Barbara Hendrickson **Content:** ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/08/GettyImages-534969258.jpg) ## Get in Touch #### BAX Securities Law® is one of Canada’s leading corporate securities law firms. If you wish to contact BAX Securities Law, please fill out the form or reach out via phone – [(647) 403-4606](tel:16474034606) or email at . Please enable JavaScript in your browser to complete this form. Name \* Message Name Email Email \* Message Submit![Loading](https://baxsecuritieslaw.com/wp-content/plugins/wpforms-lite/assets/images/submit-spin.svg) *Please note that prior to a formal retainer with BAX Securities Law®, we cannot guarantee or undertake to maintain unsolicited information in confidence, and if you disclose confidential information to us prior to a formal retainer you risk disclosure and adverse use of the information.* --- ### [About Us](https://baxsecuritieslaw.com/about-us/) **Published:** August 14, 2025 **Author:** Barbara Hendrickson **Content:** ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/08/GettyImages-534969258.jpg) # **About** **BAX** Securities Law® **BAX Securities Law® is repeatedly recognized as one of Canada’s top corporate law boutiques** In 2012, Barbara Hendrickson founded BAX Securities Law® after a 20 year career that included periods with Canada’s largest securities regulator, one of the world’s largest law firms, and a highly ranked national law firm. Since that time, BAX Securities Law® has been repeatedly recognized as one of Canada’s top corporate law boutiques by Canadian Lawyer Magazine. The recognition acknowledges BAX Securities Law’s nationwide legal expertise, deep industry knowledge, quality legal services, and willingness to go above and beyond to help their clients achieve their goals. Best Lawyers™ has recognized BAX Securities Law® in its 2025 and 2026 editions of [Best Law Firms – Canada](https://www.bestlawfirms.com/canada/ontario/toronto) based on BAX’s expertise, client feedback and having recognized investors on staff. **We are committed to innovation in the provision of legal services.** We will use and develop, to the greatest extent possible, technology-based solutions to assist our clients and reduce their legal fees. To improve our efficiencies and performance, we lever technology, our previous work products, online client tools, developed legal processes and checklists/templates, and our knowledge of management systems. We don’t live and die by the billable hour and neither will you. Our approach to billing is value driven providing us with an incentive for efficiency and provides you with exceptional services. **BAX sponsors a number of programs which support our profession and our community** We support a number of social causes including the Scott Mission, Sick Kids, Parkinson Canada, the Toronto People with AIDS Foundation, the Alzheimer Society, and the Princess Margaret Cancer Centre. BAX Securities Law® also sponsors professional events with the Women’s Law Association of Ontario. Our lawyers are active in the Canadian Bar Association and the Ontario Bar Association. BAX Securities Law® is the sponsor of The Toronto Business Lawyers Association (TBLA) created by our founder Barbara Hendrickson in 2016. The TBLA is a group of lawyers from small and medium-sized firms in the Greater Toronto Area who meet regularly for professional development and business referral purposes. The monthly events provide an opportunity to meet and share experiences. See [torontobusinesslawyers.org.](https://torontobusinesslawyers.org/) BAX Securities Law® has been recognized as one of Canada’s leading law firms and has earned rankings in Best Law Firms Canada compiled by Best Lawyers and in Canadian Lawyer Magazines Top Corporate Law Firms in Canada ![](https://baxsecuritieslaw.com/wp-content/uploads/2026/01/Website-Image-BEST-LAW-FIRM-2026-1-300x200.png) ![](https://baxsecuritieslaw.com/wp-content/uploads/2026/01/best-lawyers-2026.png) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/03/PR_AV_300-1.png) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/03/2025-Lexpert-Ranked-Laywer.png) --- ### [Capital Markets](https://baxsecuritieslaw.com/capital-markets/) **Published:** June 8, 2025 **Author:** jradecki **Content:** # **Capital Markets** Our clients choose us for our extensive experience and knowledge in the capital raising and public company area - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/capital-markets/) - [ ](https://twitter.com/share?text=Capital%20Markets&url=https://baxsecuritieslaw.com/capital-markets/) - [ ](https://www.linkedin.com/shareArticle?title=Capital%20Markets&url=https://baxsecuritieslaw.com/capital-markets/&mini=true) - [Overview](#overview) - [News and Insights](#news) - [Awards and Recognition](#awards) ## Overview **BAX Securities Law® has been recognized as one of Canada’s leading law firms and has earned rankings in Best Law Firms Canada compiled by Best Lawyers and in Canadian Lawyer Magazines Top Corporate Law Firms in Canada**. We assist our clients in dealing with securities regulatory requirements in today’s fast changing environment from initial start-up through to maturity. Our clients include startup and high growth companies as well as multinational corporations and financial institutions, venture capital and private equity funds dealers, advisors, investment fund managers and market participants engaged in capital market activities in Canada, the United States and internationally. BAX Securities Law® advises on: - Public and private equity, debt and crypto asset financings including private placements, initial public offerings, short form and shelf prospectuses; - Exchange listings on the TSX, the TSXV and the CSE; - Offerings of crypto assets and associated securities regulatory requirements and registrations; - Ongoing compliance with securities continuous disclosure requirements for public and exchange listed companies including insider reporting, early warning and alternative monthly reporting; - Mergers and acquisitions, reorganizations and restructurings including business combinations, plans of arrangements, takeovers (RTOs), CPC transactions, going private transactions, and contested and friendly take-over bids; - Special transactions such as rights offerings, issuer bids, insider bids, related party transactions, shareholder rights plans, registration rights agreements; - Obtaining registration as dealers, portfolio managers and investment fund managers under National Instrument 31-103 – Registration Requirements, Exemptions and Ongoing Registrant Obligations, and the related SRO rules. - Anti-money laundering, terrorist reporting, privacy and anti-spam legislation. We assist our clients with the complex regulatory standards and compliance requirements which characterize the Canadian capital markets. ## Capital Markets Law News and Insights [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-september-toronto-business-lawyers-association-monthly-meeting-2/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-souvenirpixels-1516047-scaled.jpg) ## [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-september-toronto-business-lawyers-association-monthly-meeting-2/ "baxsecuritieslawannouncestorontobusinesslawyersassociationmonthlymeeting") Toronto, August 26, 2026: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday, September 17,… [CSA And CIRO Publish Guidance on Certain Types of Prediction Market Event Contracts](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-goumbik-590041-scaled.jpg) ## [CSA And CIRO Publish Guidance on Certain Types of Prediction](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/ "csaandciropublishguidanceoncertaintypesofprediction") The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have published Joint Canadian Securities Administrators and Canadian… [CIRO Publishes Proposed Crypto Trading Platform Regulation Fee Model for Review and Comment](https://baxsecuritieslaw.com/ciro-publishes-proposed-crypto-trading-platform-regulation-fee-model-for-review-and-comment/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2026/03/ai-generated-8999631_1280-small.jpg) ## [CIRO Publishes Proposed Crypto Trading Platform Regulation Fee Model for](https://baxsecuritieslaw.com/ciro-publishes-proposed-crypto-trading-platform-regulation-fee-model-for-review-and-comment/ "ciropublishesproposedcryptotradingplatformregulationfeemodelfor") The Canadian Investment Regulatory Organization (CIRO) has published its Proposed Crypto Trading Platform Regulation Fee Model (the Proposed Crypto Fee… [CSA Publishes Updated Cybersecurity Findings and Guidance for Registered Firms](https://baxsecuritieslaw.com/csa-publishes-updated-cybersecurity-findings-and-guidance-for-registered-firms/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-thesilentman-205377-scaled.jpg) ## [CSA Publishes Updated Cybersecurity Findings and Guidance for Registered Firms](https://baxsecuritieslaw.com/csa-publishes-updated-cybersecurity-findings-and-guidance-for-registered-firms/ "csapublishesupdatedcybersecurityfindingsandguidanceforregisteredfirms") The Canadian Securities Administrators (CSA) have published CSA Staff Notice 33-322 Review of Registered Firms’ Cybersecurity Practices and Additional Guidance… [CSA Seeks Comment on Modernizing the Regulation of Public Companies](https://baxsecuritieslaw.com/csa-seeks-comment-on-modernizing-the-regulation-of-public-companies/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-karolina-grabowska-7876038-scaled.jpg) ## [CSA Seeks Comment on Modernizing the Regulation of Public Companies](https://baxsecuritieslaw.com/csa-seeks-comment-on-modernizing-the-regulation-of-public-companies/ "csaseekscommentonmodernizingtheregulationofpubliccompanies") The Canadian Securities Administrators (CSA) has published CSA Consultation Paper 51-406 Modernizing the Regulation of Public Companies (the Consultation Paper)… [Canadian Securities Administrators Published Amendments to Allow Higher Limits for the Listed Issuer Financing Exemption](https://baxsecuritieslaw.com/canadian-securities-administrators-published-amendments-to-allow-higher-limits-for-the-listed-issuer-financing-exemption/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-vivek-chugh-157138-739987-scaled.jpg) ## [Canadian Securities Administrators Published Amendments to Allow Higher Limits for](https://baxsecuritieslaw.com/canadian-securities-administrators-published-amendments-to-allow-higher-limits-for-the-listed-issuer-financing-exemption/ "canadiansecuritiesadministratorspublishedamendmentstoallowhigherlimitsfor") The Canadian Securities Administrators (CSA) has published proposed amendments to National Instrument 45-106 Prospectus Exemptions and changes to the Companion… ## Awards and Recognition - **Best Lawyers Best Canadian Law Firm**: BAX Securities Law® received this award in 2025 and 2026 - **Canadian Lawyer Top Corporate Law Boutiques**: BAX Securities Law® received this award in 2016, 2017, 2018, 2019, 2020 - **The Canadian Legal Lexpert Directory:** Barbara Hendrickson has been repeatedly recognized in the Corporate Finance & Securities Law area. --- ### [Whistleblowers](https://baxsecuritieslaw.com/whistleblowers/) **Published:** April 29, 2026 **Author:** Barbara Hendrickson **Content:** # **Whistleblowers** Whistle blowers are protected. - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/whistleblowers/) - [ ](https://twitter.com/share?text=Whistleblowers&url=https://baxsecuritieslaw.com/whistleblowers/) - [ ](https://www.linkedin.com/shareArticle?title=Whistleblowers&url=https://baxsecuritieslaw.com/whistleblowers/&mini=true) - [Overview](#overview) - [News and Insights](#news) - [Awards and Recognition](#awards) ## Overview The Ontario Securities Commission (OSC), the British Columbia Securities Commission (BCSC) and other securities commissions in Canada accept tips on possible violations of local securities law, offer protections for individuals who come forward, as well as a rewards of up to $5 million for tips that lead to enforcement actions. Examples of violations of securities legislation including illegal insider trading, tipping, fraud, misleading disclosure and financial statements and trading-related misconduct including market manipulation. The whistleblowing programs of the Canadian securities commissions are designed to provide incentives and protections to individuals who report violations of securities legislation. Whistleblowers are protected and may be entitled to payments based on the fines levied against the individuals and entities that are the subject of the whistle blowing. If you are a whistleblower and wish to submit a whistleblower report with a Canadian securities commission or if you are subject to reprisals related to your whistleblowing under securities legislation, please contact us. Barbara Hendrickson has been practicing in this area for a number of years and is listed in *[The Ontario Lawyers Directory for Whistleblowers](https://www.whistleblowingcanada.com/board_of_directors)* and [The British Columbia Lawyers Directory for whistleblowers](https://www.whistleblowingcanada.com/britishcolumbia_lawyers_directory_sub "The British Columbia Lawyers Directory for whistleblowers"), published by Whistleblowing Canada. ## News and Insights [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-september-toronto-business-lawyers-association-monthly-meeting-2/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-souvenirpixels-1516047-scaled.jpg) ## [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-september-toronto-business-lawyers-association-monthly-meeting-2/ "baxsecuritieslawannouncestorontobusinesslawyersassociationmonthlymeeting") Toronto, August 26, 2026: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday, September 17,… [CSA And CIRO Publish Guidance on Certain Types of Prediction Market Event Contracts](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-goumbik-590041-scaled.jpg) ## [CSA And CIRO Publish Guidance on Certain Types of Prediction](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/ "csaandciropublishguidanceoncertaintypesofprediction") The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have published Joint Canadian Securities Administrators and Canadian… [CIRO Publishes Proposed Crypto Trading Platform Regulation Fee Model for Review and Comment](https://baxsecuritieslaw.com/ciro-publishes-proposed-crypto-trading-platform-regulation-fee-model-for-review-and-comment/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2026/03/ai-generated-8999631_1280-small.jpg) ## [CIRO Publishes Proposed Crypto Trading Platform Regulation Fee Model for](https://baxsecuritieslaw.com/ciro-publishes-proposed-crypto-trading-platform-regulation-fee-model-for-review-and-comment/ "ciropublishesproposedcryptotradingplatformregulationfeemodelfor") The Canadian Investment Regulatory Organization (CIRO) has published its Proposed Crypto Trading Platform Regulation Fee Model (the Proposed Crypto Fee… [CSA Publishes Updated Cybersecurity Findings and Guidance for Registered Firms](https://baxsecuritieslaw.com/csa-publishes-updated-cybersecurity-findings-and-guidance-for-registered-firms/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-thesilentman-205377-scaled.jpg) ## [CSA Publishes Updated Cybersecurity Findings and Guidance for Registered Firms](https://baxsecuritieslaw.com/csa-publishes-updated-cybersecurity-findings-and-guidance-for-registered-firms/ "csapublishesupdatedcybersecurityfindingsandguidanceforregisteredfirms") The Canadian Securities Administrators (CSA) have published CSA Staff Notice 33-322 Review of Registered Firms’ Cybersecurity Practices and Additional Guidance… [CSA Seeks Comment on Modernizing the Regulation of Public Companies](https://baxsecuritieslaw.com/csa-seeks-comment-on-modernizing-the-regulation-of-public-companies/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-karolina-grabowska-7876038-scaled.jpg) ## [CSA Seeks Comment on Modernizing the Regulation of Public Companies](https://baxsecuritieslaw.com/csa-seeks-comment-on-modernizing-the-regulation-of-public-companies/ "csaseekscommentonmodernizingtheregulationofpubliccompanies") The Canadian Securities Administrators (CSA) has published CSA Consultation Paper 51-406 Modernizing the Regulation of Public Companies (the Consultation Paper)… [Canadian Securities Administrators Published Amendments to Allow Higher Limits for the Listed Issuer Financing Exemption](https://baxsecuritieslaw.com/canadian-securities-administrators-published-amendments-to-allow-higher-limits-for-the-listed-issuer-financing-exemption/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-vivek-chugh-157138-739987-scaled.jpg) ## [Canadian Securities Administrators Published Amendments to Allow Higher Limits for](https://baxsecuritieslaw.com/canadian-securities-administrators-published-amendments-to-allow-higher-limits-for-the-listed-issuer-financing-exemption/ "canadiansecuritiesadministratorspublishedamendmentstoallowhigherlimitsfor") The Canadian Securities Administrators (CSA) has published proposed amendments to National Instrument 45-106 Prospectus Exemptions and changes to the Companion… ## Awards and Recognition - **Best Lawyers Best Canadian Law Firm**: BAX Securities Law® received this award in 2025 and 2026 - **Canadian Lawyer Top Corporate Law Boutiques**: BAX Securities Law® received this award in 2016, 2017, 2018, 2019, 2020 - **The Canadian Legal Lexpert Directory:** Barbara Hendrickson has been repeatedly recognized in the Corporate Finance & Securities Law area. --- ### [Cryptocurrency](https://baxsecuritieslaw.com/crypto-assets/) **Published:** August 25, 2025 **Author:** Barbara Hendrickson **Content:** # Crypto Assets Bitcoin, Ethereum, non-fungible tokens (NFTs) and stablecoins have emerged as an alternative asset class. - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/crypto-assets/) - [ ](https://twitter.com/share?text=Cryptocurrency&url=https://baxsecuritieslaw.com/crypto-assets/) - [ ](https://www.linkedin.com/shareArticle?title=Cryptocurrency&url=https://baxsecuritieslaw.com/crypto-assets/&mini=true) - [Overview](#overview) - [News and Insights](#news) - [Awards and Recognition](#awards) ## Overview **Digital ledger technologies including blockchain are reshaping the global markets and the impact of crypto assets is spreading across a number of business sectors.** Since 2017, we have been advising clients on digital assets and blockchain law including the registration of crypto trading platforms and guiding securities registrants, including restricted and investment dealers, portfolio managers and investment fund managers, with respect to new initiatives and structuring crypto funds. We provide comprehensive counsel on a wide array of laws, including securities, consumer protection, FINTRAC money service business registrations, anti-money laundering, financial services regulation, and payment processing. We help clients navigate the CSA’s regulatory framework for crypto trading platforms, including the requirements for platforms to become registered as investment dealers and members of CIRO. Our Expertise Includes: - navigating crypto trading and investing regulations; - managing compliance investigations and proceedings before the OSC, CIRO, and FINTRAC; - securing registration and ensuring compliance with FINTRAC regulations, including anti-money laundering and terrorist financing reporting obligations; - structuring token offerings to comply with prospectus exemptions and private placement requirements; - architecting tokenized business models in diverse sectors, including agriculture, aviation, mortgages, and real estate. - guiding fintech innovators on the integration of blockchain technology and digital assets into their platforms; - establishing compliant frameworks for stablecoin issuance, distribution, and use in payments, settlements, and corporate treasury functions. ## Key Contacts [![Barbara Hendrickson](https://baxsecuritieslaw.com/wp-content/uploads/2025/11/Barb-square.jpg)](https://baxsecuritieslaw.com/bhendrickson/) ### Barbara Hendrickson #### Founder, Award Winning Securities Lawyer Barbara has practiced in the securities and corporate areas for nearly 30 years. ## Crypto Law News and Insights [CIRO Publishes Proposed Crypto Trading Platform Regulation Fee Model for Review and Comment](https://baxsecuritieslaw.com/ciro-publishes-proposed-crypto-trading-platform-regulation-fee-model-for-review-and-comment/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2026/03/ai-generated-8999631_1280-small.jpg) ## [CIRO Publishes Proposed Crypto Trading Platform Regulation Fee Model for](https://baxsecuritieslaw.com/ciro-publishes-proposed-crypto-trading-platform-regulation-fee-model-for-review-and-comment/ "ciropublishesproposedcryptotradingplatformregulationfeemodelfor") The Canadian Investment Regulatory Organization (CIRO) has published its Proposed Crypto Trading Platform Regulation Fee Model (the Proposed Crypto Fee… [SEC Chair Outlines “Project Crypto” in Speech](https://baxsecuritieslaw.com/sec-chair-outlines-project-crypto-in-speech/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/07/bitcoin-7077716_1280.jpg) ## [SEC Chair Outlines “Project Crypto” in Speech](https://baxsecuritieslaw.com/sec-chair-outlines-project-crypto-in-speech/ "secchairoutlinesprojectcryptoinspeech") In a recent speech to the Federal Reserve Bank of Philadelphia, U.S. Securities and Exchange Commission (SEC) chair Paul S…. [CSA Cautions Crypto Lending Platforms And Customers](https://baxsecuritieslaw.com/csa-cautions-crypto-lending-platforms-and-customers/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/07/bitcoin-6285223_1280.jpg) ## [CSA Cautions Crypto Lending Platforms And Customers](https://baxsecuritieslaw.com/csa-cautions-crypto-lending-platforms-and-customers/ "csacautionscryptolendingplatformsandcustomers") In the wake of the recent record CAD $176,960,190 administrative monetary penalty levied by the Financial Transactions and Reports Analysis Centre… [FINTRAC Issues Record CAD $176 Million Penalty To Xeltox/Cryptomus](https://baxsecuritieslaw.com/fintrac-issues-record-cad-176-million-penalty-to-xeltox-cryptomus/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-pavel-danilyuk-8112203-scaled.jpg) ## [FINTRAC Issues Record CAD $176 Million Penalty To Xeltox/Cryptomus](https://baxsecuritieslaw.com/fintrac-issues-record-cad-176-million-penalty-to-xeltox-cryptomus/ "fintracissuesrecordcad176millionpenaltytoxeltoxcryptomus") The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has issued a record CAD $176,960,190 administrative monetary penalty on Xeltox… ![No Thumbnail Found](https://baxsecuritieslaw.com/wp-content/uploads/2026/03/ai-generated-8999631_1280-small.jpg) ## [CSA’s 2024-2025 Year in Review Highlights Increased Crypto Enforcement Actions](https://baxsecuritieslaw.com/csas-2024-2025-year-in-review-highlights-increased-crypto-enforcement-actions/ "csas2024-2025yearinreviewhighlightsincreasedcryptoenforcementactions") The Canadian Securities Administrators (CSA) recently published their 2024 – 2025 Year in Review (The Year in Review), highlighting the… ![No Thumbnail Found](https://baxsecuritieslaw.com/wp-content/uploads/2026/03/ai-generated-8999631_1280-small.jpg) ## [SEC Announces Formation of New Crypto Asset Task Force](https://baxsecuritieslaw.com/sec-announces-formation-of-new-crypto-asset-task-force/ "secannouncesformationofnewcryptoassettaskforce") The U.S. Securities and Exchange Commission (SEC) published a press release on January 21, 2025 (“Press Release”) stating that it… ## Awards and Recognition - **Best Lawyers Best Canadian Law Firm**: BAX Securities Law® received this award in 2025 and 2026 - **Canadian Lawyer Top Corporate Law Boutiques**: BAX Securities Law® received this award in 2016, 2017, 2018, 2019, 2020 - **The Canadian Legal Lexpert Directory:** Barbara Hendrickson has been repeatedly recognized in the Corporate Finance & Securities Law area. --- ### [Real Estate Syndication](https://baxsecuritieslaw.com/real-estate-syndication/) **Published:** November 16, 2016 **Author:** Ian **Content:** # **Real Estate Syndication** BAX Securities Law™ has decades of experience structuring investment vehicles and raising capital in all major Canadian real estate markets. - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/real-estate-syndication/) - [ ](https://twitter.com/share?text=Real%20Estate%20Syndication&url=https://baxsecuritieslaw.com/real-estate-syndication/) - [ ](https://www.linkedin.com/shareArticle?title=Real%20Estate%20Syndication&url=https://baxsecuritieslaw.com/real-estate-syndication/&mini=true) - [Overview](#overview) - [News and Insights](#news) - [Awards and Recognition](#awards) ## Overview ******Canada real estate markets are an important investment opportunity for Canadian, American and international investors. Our clients range from seasoned commercial real estate developers and brokers to individuals raising capital for their first real estate deal.****** We advise our clients on: - syndications including REITs, limited partnerships and corporations for real estate entrepreneurs and small business start-ups in the Canadian and cross border context; - going public transactions for REITs and other real estate entities; - equity and debt financings in the private markets including the preparation of offering memoranda / subscription documents as well as securities compliance; and - RSP eligible products such as syndicated mortgages, mortgage investment corporations, mutual fund trusts and “public corporations”. Our clients range from seasoned commercial real estate developers and brokers to individuals raising capital for their first real estate deal. We have been involved in numerous public and private syndication transactions for real estate related products including RSP eligible products such as syndicated mortgages, mortgage investment corporations, mutual fund trusts and “public corporations”. Our clients are active in several real estate areas including office, retail and industrial properties, residential projects, buildings designed for multiple families, condominium projects, and healthcare-related real estate projects. We advise clients on mortgage investment entities (MIEs) including mortgage investment corporations (MICs) under the *Income Tax Act* in structuring and formation of entities, securities, financial services compliance and regulation, and capital raising including equity, debt and trust, and limited partnership units. ## Key Contacts [![Barbara Hendrickson](https://baxsecuritieslaw.com/wp-content/uploads/2025/11/Barb-square.jpg)](https://baxsecuritieslaw.com/bhendrickson/) ### Barbara Hendrickson #### Founder, Award Winning Securities Lawyer Barbara has practiced in the securities and corporate areas for nearly 30 years. ## **Real Estate** Law News and Insights [FINTRAC Supports Mortgage Sector Compliance](https://baxsecuritieslaw.com/fintrac-supports-mortgage-sector-compliance/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-yaroslav-y-1225711088-24245347-scaled.jpg) ## [FINTRAC Supports Mortgage Sector Compliance](https://baxsecuritieslaw.com/fintrac-supports-mortgage-sector-compliance/ "fintracsupportsmortgagesectorcompliance") The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has published a set of resources to support Canadian mortgage… ![No Thumbnail Found](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-mantasink-1106476-scaled.jpg) ## [New FINTRAC anti-money laundering and anti-terrorism requirements target mortgage sector](https://baxsecuritieslaw.com/new-fintrac-anti-money-laundering-and-anti-terrorism-requirements-target-mortgage-sector/ "newfintracanti-moneylaunderingandanti-terrorismrequirementstargetmortgagesector") The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has published new anti-money laundering and anti-terrorism requirements (the new… ![No Thumbnail Found](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-mantasink-1106476-scaled.jpg) ## [FSRA’s Enforcement Activities – Syndicated Mortgages](https://baxsecuritieslaw.com/fsras-enforcement-activities-syndicated-mortgages/ "fsrasenforcementactivities-syndicatedmortgages") An area of enforcement activity has been in the syndicated mortgage area, Syndicated mortgages continue to be a regulatory minefield… ![No Thumbnail Found](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-mantasink-1106476-scaled.jpg) ## [FINTRAC Issues New AML Requirements for Mortgage Administrators, Brokers, and](https://baxsecuritieslaw.com/fintrac-issues-new-aml-requirements-for-mortgage-administrators-brokers-and-lenders/ "fintracissuesnewamlrequirementsformortgageadministratorsbrokersand") The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has issued new Anti-Money Laundering Requirements (AML) for Mortgage Administrators, Brokers,… ![No Thumbnail Found](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-mantasink-1106476-scaled.jpg) ## [CSA Notice 45-328 – Update on Amendments relating to Syndicated](https://baxsecuritieslaw.com/csa-notice-45-328-update-on-amendments-relating-to-syndicated-mortgages/ "csanotice45-328-updateonamendmentsrelatingtosyndicated") On February 25, 2021, the Canadian Securities Administrators (CSA), referring to amendments to certain securities rules affecting the prospectus and… ![No Thumbnail Found](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-mantasink-1106476-scaled.jpg) ## [OSC Notice of Amendments to OSC Rule 45-501 Ontario Prospectus](https://baxsecuritieslaw.com/osc-notice-of-amendments-to-osc-rule-45-501-ontario-prospectus-and-registration-exemptions-relating-to-syndicated-mortgages/ "oscnoticeofamendmentstooscrule45-501ontarioprospectus") On December 7, 2020 the Ontario Securities Commission (OSC) announced that they are making amendments to OSC Rule 45- 501… ## Awards and Recognition - **Best Lawyers Best Canadian Law Firm**: BAX Securities Law® received this award in 2025 and 2026 - **Canadian Lawyer Top Corporate Law Boutiques**: BAX Securities Law® received this award in 2016, 2017, 2018, 2019, 2020 - **The Canadian Legal Lexpert Directory:** Barbara Hendrickson has been repeatedly recognized in the Corporate Finance & Securities Law area. --- ### [Artificial Intelligence](https://baxsecuritieslaw.com/artificial-intelligence/) **Published:** August 25, 2025 **Author:** Barbara Hendrickson **Content:** # **Artificial Intelligence** We provide sophisticated advice on the use of AI by existing businesses and guide the creation, financing and operation of new and upcoming AI companies and products. - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/artificial-intelligence/) - [ ](https://twitter.com/share?text=Artificial%20Intelligence&url=https://baxsecuritieslaw.com/artificial-intelligence/) - [ ](https://www.linkedin.com/shareArticle?title=Artificial%20Intelligence&url=https://baxsecuritieslaw.com/artificial-intelligence/&mini=true) - [Overview](#overview) - [News and Insights](#news) - [Awards and Recognition](#awards) ## Overview **Artificial intelligence (AI) is not just a technological shift; it’s a fundamental reshaping of the business and legal landscape.** AI presents transformative opportunities for new and emerging companies and established enterprises alike. BAX Securities Law® offers services in the following areas of law: - Corporate Structuring & AI Governance: We assist startups and venture capital firms focusing on AI technology with structuring businesses to facilitate growth, investment and scalability. We provide guidance on corporate governance frameworks that address AI-specific risks and oversight requirements, ensuring that corporate strategy is built on a solid legal and ethical foundation. - Capital Markets: We assist venture capital and startup firms focusing on AI technology to raise capital for financing short and long term growth plans in the private and public markets. We advise on disclosure requirements for AI-related businesses under National Instrument 51-102 Continuous Disclosure Obligations, including material AI-related risk factors and forward-looking information about AI use and development. - Registrants: We assist securities registrants, including CIRO investment dealers and exempt market and restricted dealers, with compliance with securities regulatory requirements related to AI. We also assist money services businesses respecting their FINTRAC and Bank of Canada obligations. We provide guidance on the CSA Staff Notice and Consultation 11-348 regarding the applicability of Canadian securities laws to the use of AI systems in capital markets. - Public Company Disclosure and AI Risks: We assist market participants in all industries to address risks involved in the use of AI systems, as well securities requirements regarding the disclosure of the same. We help public companies develop tailored, entity-specific AI disclosures that avoid boilerplate language and “AI washing” in accordance with CSA guidance. This includes disclosure of AI business use, AI-related risk factors, and forward-looking information about AI implementation. - Commercializing AI – Contracts & Licensing: We assist with the drafting of contract for AI product licensing, partnerships and customer agreements, protecting intellectual property and creating clear pathways for commercial success. - Data, Privacy & AI Ethics: We provide advice on privacy and data protection issues related to the development, distribution and use of AI including compliance with Canadian laws, regulation, and data protection laws. We advise on compliance with the *Personal Information Protection and Electronic Documents Act* (PIPEDA), provincial privacy laws, and emerging AI-specific privacy requirements. AI Governance and Risk Management: We help organizations develop robust governance frameworks for responsible AI use, including policies for AI ethics, risk assessment, and regulatory compliance. We assist with implementing appropriate oversight mechanisms and accountability structures for AI systems. ## Key Contacts [![Barbara Hendrickson](https://baxsecuritieslaw.com/wp-content/uploads/2025/11/Barb-square.jpg)](https://baxsecuritieslaw.com/bhendrickson/) ### Barbara Hendrickson #### Founder, Award Winning Securities Lawyer Barbara has practiced in the securities and corporate areas for nearly 30 years. ## **A.I. Law** News and Insights [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-september-toronto-business-lawyers-association-monthly-meeting-2/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-souvenirpixels-1516047-scaled.jpg) ## [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-september-toronto-business-lawyers-association-monthly-meeting-2/ "baxsecuritieslawannouncestorontobusinesslawyersassociationmonthlymeeting") Toronto, August 26, 2026: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday, September 17,… [CSA And CIRO Publish Guidance on Certain Types of Prediction Market Event Contracts](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-goumbik-590041-scaled.jpg) ## [CSA And CIRO Publish Guidance on Certain Types of Prediction](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/ "csaandciropublishguidanceoncertaintypesofprediction") The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have published Joint Canadian Securities Administrators and Canadian… [CIRO Publishes Proposed Crypto Trading Platform Regulation Fee Model for Review and Comment](https://baxsecuritieslaw.com/ciro-publishes-proposed-crypto-trading-platform-regulation-fee-model-for-review-and-comment/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2026/03/ai-generated-8999631_1280-small.jpg) ## [CIRO Publishes Proposed Crypto Trading Platform Regulation Fee Model for](https://baxsecuritieslaw.com/ciro-publishes-proposed-crypto-trading-platform-regulation-fee-model-for-review-and-comment/ "ciropublishesproposedcryptotradingplatformregulationfeemodelfor") The Canadian Investment Regulatory Organization (CIRO) has published its Proposed Crypto Trading Platform Regulation Fee Model (the Proposed Crypto Fee… [CSA Publishes Updated Cybersecurity Findings and Guidance for Registered Firms](https://baxsecuritieslaw.com/csa-publishes-updated-cybersecurity-findings-and-guidance-for-registered-firms/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-thesilentman-205377-scaled.jpg) ## [CSA Publishes Updated Cybersecurity Findings and Guidance for Registered Firms](https://baxsecuritieslaw.com/csa-publishes-updated-cybersecurity-findings-and-guidance-for-registered-firms/ "csapublishesupdatedcybersecurityfindingsandguidanceforregisteredfirms") The Canadian Securities Administrators (CSA) have published CSA Staff Notice 33-322 Review of Registered Firms’ Cybersecurity Practices and Additional Guidance… [CSA Seeks Comment on Modernizing the Regulation of Public Companies](https://baxsecuritieslaw.com/csa-seeks-comment-on-modernizing-the-regulation-of-public-companies/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-karolina-grabowska-7876038-scaled.jpg) ## [CSA Seeks Comment on Modernizing the Regulation of Public Companies](https://baxsecuritieslaw.com/csa-seeks-comment-on-modernizing-the-regulation-of-public-companies/ "csaseekscommentonmodernizingtheregulationofpubliccompanies") The Canadian Securities Administrators (CSA) has published CSA Consultation Paper 51-406 Modernizing the Regulation of Public Companies (the Consultation Paper)… [Canadian Securities Administrators Published Amendments to Allow Higher Limits for the Listed Issuer Financing Exemption](https://baxsecuritieslaw.com/canadian-securities-administrators-published-amendments-to-allow-higher-limits-for-the-listed-issuer-financing-exemption/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-vivek-chugh-157138-739987-scaled.jpg) ## [Canadian Securities Administrators Published Amendments to Allow Higher Limits for](https://baxsecuritieslaw.com/canadian-securities-administrators-published-amendments-to-allow-higher-limits-for-the-listed-issuer-financing-exemption/ "canadiansecuritiesadministratorspublishedamendmentstoallowhigherlimitsfor") The Canadian Securities Administrators (CSA) has published proposed amendments to National Instrument 45-106 Prospectus Exemptions and changes to the Companion… ## Awards and Recognition - **Best Lawyers Best Canadian Law Firm**: BAX Securities Law® received this award in 2025 and 2026 - **Canadian Lawyer Top Corporate Law Boutiques**: BAX Securities Law® received this award in 2016, 2017, 2018, 2019, 2020 - **The Canadian Legal Lexpert Directory:** Barbara Hendrickson has been repeatedly recognized in the Corporate Finance & Securities Law area. --- ### [Corporate & Commercial](https://baxsecuritieslaw.com/securities-enforcement/) **Published:** June 18, 2025 **Author:** Barbara Hendrickson **Content:** # Corporate & Commercial Assisting market and financial services participants with compliance audits and enforcement actions - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/securities-enforcement/) - [ ](https://twitter.com/share?text=Corporate%20&%20Commercial&url=https://baxsecuritieslaw.com/securities-enforcement/) - [ ](https://www.linkedin.com/shareArticle?title=Corporate%20&%20Commercial&url=https://baxsecuritieslaw.com/securities-enforcement/&mini=true) - [Overview](#overview) - [News and Insights](#news) - [Awards and Recognition](#awards) ## Overview **Bax Securities Law® is one of the leading boutique law firms and assists clients with business formations, corporate restructuring and reorganization, corporate governance, shareholders agreements, amendments of articles, annual meetings, equity compensation including stock option plans as well as a broad range of business law issues.** Our clients range from Canadian and international businesses of all sizes, from start-ups to small and mid-size businesses. BAX Securities Law® helps clients by: - assisting in setting up business structures including corporations, limited partnerships and trusts; - providing timely, practical and accessible advice concerning the day-to-day matters affecting businesses; - advising on the structuring relationships between multiple business owners, including shareholder agreements and partnership agreements; - advising on relevant Canadian regulatory requirements; - preparing and negotiating shareholder and partnership agreements; - advising on equity compensation arrangements including stock option plans and other incentive arrangements, including employee incentive plans; - maintaining corporate records; - designing and assisting with the execution of domestic and international M&A transactions including advising on acquisition strategies, acquisition financing, and preparing for and implementing M&A transactions including advising board of directors and drafting letters of intent; - assisting with purchases and sales of both public and private companies with purchase and sale agreements, and public companies with all types of public and private mergers and acquisitions, including share purchases, mergers, amalgamations and plans of arrangement; going private transactions; special committee mandates; takeovers; reverse takeovers, and levered and management buyouts. ## Key Contacts [![Barbara Hendrickson](https://baxsecuritieslaw.com/wp-content/uploads/2025/11/Barb-square.jpg)](https://baxsecuritieslaw.com/bhendrickson/) ### Barbara Hendrickson #### Founder, Award Winning Securities Lawyer Barbara has practiced in the securities and corporate areas for nearly 30 years. ## Corporate & Commercial Law News [CSA And CIRO Publish Guidance on Certain Types of Prediction Market Event Contracts](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-goumbik-590041-scaled.jpg) ## [CSA And CIRO Publish Guidance on Certain Types of Prediction](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/ "csaandciropublishguidanceoncertaintypesofprediction") The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have published Joint Canadian Securities Administrators and Canadian… [CSA Publishes Updated Cybersecurity Findings and Guidance for Registered Firms](https://baxsecuritieslaw.com/csa-publishes-updated-cybersecurity-findings-and-guidance-for-registered-firms/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-thesilentman-205377-scaled.jpg) ## [CSA Publishes Updated Cybersecurity Findings and Guidance for Registered Firms](https://baxsecuritieslaw.com/csa-publishes-updated-cybersecurity-findings-and-guidance-for-registered-firms/ "csapublishesupdatedcybersecurityfindingsandguidanceforregisteredfirms") The Canadian Securities Administrators (CSA) have published CSA Staff Notice 33-322 Review of Registered Firms’ Cybersecurity Practices and Additional Guidance… [Canadian Securities Administrators Published Amendments to Allow Higher Limits for the Listed Issuer Financing Exemption](https://baxsecuritieslaw.com/canadian-securities-administrators-published-amendments-to-allow-higher-limits-for-the-listed-issuer-financing-exemption/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-vivek-chugh-157138-739987-scaled.jpg) ## [Canadian Securities Administrators Published Amendments to Allow Higher Limits for](https://baxsecuritieslaw.com/canadian-securities-administrators-published-amendments-to-allow-higher-limits-for-the-listed-issuer-financing-exemption/ "canadiansecuritiesadministratorspublishedamendmentstoallowhigherlimitsfor") The Canadian Securities Administrators (CSA) has published proposed amendments to National Instrument 45-106 Prospectus Exemptions and changes to the Companion… [Canadian Securities Administrators Publish Amendments to National Instrument 81-105 Mutual Fund Sales Practices and Other Instruments and Policies Relating to Principal Distributors](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-amendments-to-national-instrument-81-105-mutual-fund-sales-practices-and-other-instruments-and-policies-relating-to-principal-distributors/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-vivek-chugh-157138-739987-scaled.jpg) ## [Canadian Securities Administrators Publish Amendments to National Instrument 81-105 Mutual](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-amendments-to-national-instrument-81-105-mutual-fund-sales-practices-and-other-instruments-and-policies-relating-to-principal-distributors/ "canadiansecuritiesadministratorspublishamendmentstonationalinstrument81-105mutual") The Canadian Securities Administrators (CSA) recently announced the publication of final amendments to the principal distributor model (the Final Amendments)… [BCSC Issues its First Whistleblower Award](https://baxsecuritieslaw.com/bcsc-issues-its-first-whistleblower-award/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-djpetty2-756790-scaled.jpg) ## [BCSC Issues its First Whistleblower Award](https://baxsecuritieslaw.com/bcsc-issues-its-first-whistleblower-award/ "bcscissuesitsfirstwhistlebloweraward") The British Columbia Securities Commission (BCSC) has made its first whistleblower award of $25,000 to an individual whose information contributed… [Canadian Securities Exchange Publishes Proposed Public Interest Rule Amendments – Proposed – Request for Comments](https://baxsecuritieslaw.com/canadian-securities-exchange-publishes-proposed-public-interest-rule-amendments-proposed-request-for-comments/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-kindelmedia-7979432.jpg) ## [Canadian Securities Exchange Publishes Proposed Public Interest Rule Amendments –](https://baxsecuritieslaw.com/canadian-securities-exchange-publishes-proposed-public-interest-rule-amendments-proposed-request-for-comments/ "canadiansecuritiesexchangepublishesproposedpublicinterestruleamendments") CNSX Markets Inc., operator of the Canadian Securities Exchange (CSE) is proposing amendments (the Proposed Amendments) to the CSE Listing… ## Awards and Recognition - **Best Lawyers Best Canadian Law Firm**: BAX Securities Law® received this award in 2025 and 2026 - **Canadian Lawyer Top Corporate Law Boutiques**: BAX Securities Law® received this award in 2016, 2017, 2018, 2019, 2020 - **The Canadian Legal Lexpert Directory:** Barbara Hendrickson has been repeatedly recognized in the Corporate Finance & Securities Law area. --- ### [Financial Services Regulation](https://baxsecuritieslaw.com/financial-services-regulation/) **Published:** June 18, 2025 **Author:** Barbara Hendrickson **Content:** # **Financial Services Regulation** The financial services industry in Canada is constantly adapting to a complex and ever-changing regulatory landscape. - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/financial-services-regulation/) - [ ](https://twitter.com/share?text=Financial%20Services%20Regulation&url=https://baxsecuritieslaw.com/financial-services-regulation/) - [ ](https://www.linkedin.com/shareArticle?title=Financial%20Services%20Regulation&url=https://baxsecuritieslaw.com/financial-services-regulation/&mini=true) - [Overview](#overview) - [News and Insights](#news) - [Awards and Recognition](#awards) ## Overview **BAX Securities Law® has direct experience dealing with Canadian financial services regulatory bodies including FSRA, FINTRAC and OSFI and can assist with risk -management and compliance strategies.** We advise a wide range of participants in the financial services area including banks, credit unions, insurance companies, pension plans, investment dealers and other financial institutions on a wide range of issues including the establishment of new entities, products and the federal and provincial regulatory compliance requirements. BAX Securities Law® advises payment processors and participants in the Blockchain, FinTech and crypto asset sectors on federal regulatory requirements including registration as a money service business (MSB) with FINTRAC; FINTRAC’s anti-money laundering regulations, and the Bank of Canada’s regulatory framework for payment processors. BAX Securities Law® also advises mortgage lenders, administrators and brokers with respect to FSRA compliance requirements including enhanced ‘know your client’, suitability requirements and navigating the syndicated mortgages rules. If you are a mortgage broker, administrator or agent facing an allegation by FSRA of non-compliance with the regulations set out in the *Financial Services Regulatory Authority of Ontario Act* or the *Mortgage Brokerages, Lenders and Administrators Act*, BAX Securities Law® can assist. The financial services industry in Canada is constantly adapting to a complex and ever-changing regulatory landscape. BAX Securities Law® has direct experience dealing with Canadian financial services regulatory bodies including FSRA, FINTRAC and OSFI and can assist with risk-management and compliance strategies. ## Key Contacts [![Barbara Hendrickson](https://baxsecuritieslaw.com/wp-content/uploads/2025/11/Barb-square.jpg)](https://baxsecuritieslaw.com/bhendrickson/) ### Barbara Hendrickson #### Founder, Award Winning Securities Lawyer Barbara has practiced in the securities and corporate areas for nearly 30 years. ## **Financial Services Regulation** Insights [Whistleblowing in Canada](https://baxsecuritieslaw.com/whistleblowing-in-canada/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-pavel-danilyuk-8112136-scaled.jpg) ## [Whistleblowing in Canada](https://baxsecuritieslaw.com/whistleblowing-in-canada/ "whistleblowingincanada") When news of a whistleblowing award becomes public in Canadian financial circles it usually makes news; not only from the… [BCSC Publishes Update to NI 81-106, Investment Fund Continuous Disclosure](https://baxsecuritieslaw.com/bcsc-publishes-update-to-ni-81-106-investment-fund-continuous-disclosure/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-keszthelyit-2382283-scaled.jpg) ## [BCSC Publishes Update to NI 81-106, Investment Fund Continuous Disclosure](https://baxsecuritieslaw.com/bcsc-publishes-update-to-ni-81-106-investment-fund-continuous-disclosure/ "bcscpublishesupdatetoni81-106investmentfundcontinuousdisclosure") The Canadian Securities Administrators (CSA) including the Ontario Securities Commission (OSC) has published an update to National Instrument 81-106, Investment… [CSA Announces Adoption of Final Amendments to Trading Fee Caps](https://baxsecuritieslaw.com/csa-announces-adoption-of-final-amendments-to-trading-fee-caps/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-karolina-grabowska-7876088-1-scaled.jpg) ## [CSA Announces Adoption of Final Amendments to Trading Fee Caps](https://baxsecuritieslaw.com/csa-announces-adoption-of-final-amendments-to-trading-fee-caps/ "csaannouncesadoptionoffinalamendmentstotradingfeecaps") Provided all necessary ministerial approvals are obtained, the Canadian Securities Administrators (CSA) advises that final amendments to National Instrument 23-101… [BAX Securities Law’s Barbara Hendrickson speaker at Ukraine Bar Association Conference](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-speaker-a-ukraine-bar-association-conference/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-davegarcia-34067359-scaled.jpg) ## [BAX Securities Law’s Barbara Hendrickson speaker at Ukraine Bar Association](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-speaker-a-ukraine-bar-association-conference/ "baxsecuritieslawsbarbarahendricksonspeakeratukrainebarassociation") Barbara Hendrickson, founder and Managing Partner of BAX Securities Law, was a guest speaker at the III Annual International Scientific… [Barbara Hendrickson re-appointed to BCSC Fintech Advisory Forum](https://baxsecuritieslaw.com/barbara-hendrickson-re-appointed-to-bcsc-fintech-advisory-forum/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-luis-ruiz-1285613.jpg) ## [Barbara Hendrickson re-appointed to BCSC Fintech Advisory Forum](https://baxsecuritieslaw.com/barbara-hendrickson-re-appointed-to-bcsc-fintech-advisory-forum/ "barbarahendricksonre-appointedtobcscfintechadvisoryforum") Barbara Hendrickson, founder and Managing Partner of BAX Securities Law, has been reappointed to a third two-year term as member… [CIRO Publishes Proposed Consolidation Rules for Comment](https://baxsecuritieslaw.com/ciro-publishes-proposed-consolidation-rules-for-comment/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-karolina-grabowska-7876088-1-scaled.jpg) ## [CIRO Publishes Proposed Consolidation Rules for Comment](https://baxsecuritieslaw.com/ciro-publishes-proposed-consolidation-rules-for-comment/ "ciropublishesproposedconsolidationrulesforcomment") The Canadian Investment Regulatory Organization (CIRO) is republishing for further comment the complete proposed consolidated rules (Proposed CIRO Rules) for… ## Awards and Recognition - **Best Lawyers Best Canadian Law Firm**: BAX Securities Law® received this award in 2025 and 2026 - **Canadian Lawyer Top Corporate Law Boutiques**: BAX Securities Law® received this award in 2016, 2017, 2018, 2019, 2020 - **The Canadian Legal Lexpert Directory:** Barbara Hendrickson has been repeatedly recognized in the Corporate Finance & Securities Law area. --- ### [Corporate Finance & Securities](https://baxsecuritieslaw.com/securities-regulation/) **Published:** June 18, 2025 **Author:** Barbara Hendrickson **Content:** # ****Corporate Finance & Securities**** Senior lawyers providing assistance to financial services and capital markets clients - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/securities-regulation/) - [ ](https://twitter.com/share?text=Corporate%20Finance%20&%20Securities&url=https://baxsecuritieslaw.com/securities-regulation/) - [ ](https://www.linkedin.com/shareArticle?title=Corporate%20Finance%20&%20Securities&url=https://baxsecuritieslaw.com/securities-regulation/&mini=true) - [Overview](#overview) - [News and Insights](#news) - [Awards and Recognition](#awards) ## Overview ****BAX Securities Law® has direct experience dealing with Canadian securities and financial services regulatory bodies including the Ontario Securities Commission, the British Columbia Securities Commission and other Canadian regulatory authorities.**** BAX Securities Law® is one of Toronto’s leading capital markets boutique law firms. Our experience includes innovative products and structures in the proptech, fintech, debt and crypto spaces, with a focus on completing private and public capital raising and assisting cross border and international clients to successfully access the Canadian capital markets as will as with a broad range of ongoing disclosure, compliance and regulatory matters. Our clients include Canadian and non-Canadian private and public companies, financial services, firms, accounting firms, and their officers, directors and employees who retain us on a broad range of other public capital market matters, long form, short form, and shelf prospectuses and private placements. We also provide advice to exempt market dealers, portfolio managers, investment fund managers, investment dealers and individual registrants in connection with their initial registrations and ongoing compliance. Our founder, Barbara Hendrickson, is a former senior legal counsel at the OSC and has participated in a number of OSC securities advisory committees. Barbara brings decades of experience and knowledge of OSC decision making, and personnel and enforcement practices to assess and provide a detailed strategy to resolve your matter. ## **Corporate Finance & Securities** Law News [Whistleblowing in Canada](https://baxsecuritieslaw.com/whistleblowing-in-canada/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-pavel-danilyuk-8112136-scaled.jpg) ## [Whistleblowing in Canada](https://baxsecuritieslaw.com/whistleblowing-in-canada/ "whistleblowingincanada") When news of a whistleblowing award becomes public in Canadian financial circles it usually makes news; not only from the… [BCSC Publishes Update to NI 81-106, Investment Fund Continuous Disclosure](https://baxsecuritieslaw.com/bcsc-publishes-update-to-ni-81-106-investment-fund-continuous-disclosure/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-keszthelyit-2382283-scaled.jpg) ## [BCSC Publishes Update to NI 81-106, Investment Fund Continuous Disclosure](https://baxsecuritieslaw.com/bcsc-publishes-update-to-ni-81-106-investment-fund-continuous-disclosure/ "bcscpublishesupdatetoni81-106investmentfundcontinuousdisclosure") The Canadian Securities Administrators (CSA) including the Ontario Securities Commission (OSC) has published an update to National Instrument 81-106, Investment… [CSA Announces Adoption of Final Amendments to Trading Fee Caps](https://baxsecuritieslaw.com/csa-announces-adoption-of-final-amendments-to-trading-fee-caps/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-karolina-grabowska-7876088-1-scaled.jpg) ## [CSA Announces Adoption of Final Amendments to Trading Fee Caps](https://baxsecuritieslaw.com/csa-announces-adoption-of-final-amendments-to-trading-fee-caps/ "csaannouncesadoptionoffinalamendmentstotradingfeecaps") Provided all necessary ministerial approvals are obtained, the Canadian Securities Administrators (CSA) advises that final amendments to National Instrument 23-101… [Canadian Securities Regulators Greenlight Project Samara](https://baxsecuritieslaw.com/canadian-securities-regulators-greenlight-project-samara/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-cottonbro-6535346.jpg) ## [Canadian Securities Regulators Greenlight Project Samara](https://baxsecuritieslaw.com/canadian-securities-regulators-greenlight-project-samara/ "canadiansecuritiesregulatorsgreenlightprojectsamara") The Ontario Securities Commission (OSC), the Autorité des marchés financiers (AMF) and the Canadian Investment Regulatory Organization (CIRO) (the Canadian… [BAX Securities Law’s Barbara Hendrickson speaker at Ukraine Bar Association Conference](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-speaker-a-ukraine-bar-association-conference/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-davegarcia-34067359-scaled.jpg) ## [BAX Securities Law’s Barbara Hendrickson speaker at Ukraine Bar Association](https://baxsecuritieslaw.com/bax-securities-laws-barbara-hendrickson-speaker-a-ukraine-bar-association-conference/ "baxsecuritieslawsbarbarahendricksonspeakeratukrainebarassociation") Barbara Hendrickson, founder and Managing Partner of BAX Securities Law, was a guest speaker at the III Annual International Scientific… [Barbara Hendrickson re-appointed to BCSC Fintech Advisory Forum](https://baxsecuritieslaw.com/barbara-hendrickson-re-appointed-to-bcsc-fintech-advisory-forum/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-luis-ruiz-1285613.jpg) ## [Barbara Hendrickson re-appointed to BCSC Fintech Advisory Forum](https://baxsecuritieslaw.com/barbara-hendrickson-re-appointed-to-bcsc-fintech-advisory-forum/ "barbarahendricksonre-appointedtobcscfintechadvisoryforum") Barbara Hendrickson, founder and Managing Partner of BAX Securities Law, has been reappointed to a third two-year term as member… ## Awards and Recognition - **Best Lawyers Best Canadian Law Firm**: BAX Securities Law® received this award in 2025 and 2026 - **Canadian Lawyer Top Corporate Law Boutiques**: BAX Securities Law® received this award in 2016, 2017, 2018, 2019, 2020 - **The Canadian Legal Lexpert Directory:** Barbara Hendrickson has been repeatedly recognized in the Corporate Finance & Securities Law area. --- ### [Investment Funds](https://baxsecuritieslaw.com/investment-funds/) **Published:** November 16, 2016 **Author:** Ian **Content:** # **Investment Funds** Our clients choose us for our expert advice on investment fund structuring and management - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/investment-funds/) - [ ](https://twitter.com/share?text=Investment%20Funds&url=https://baxsecuritieslaw.com/investment-funds/) - [ ](https://www.linkedin.com/shareArticle?title=Investment%20Funds&url=https://baxsecuritieslaw.com/investment-funds/&mini=true) - [Overview](#overview) - [News and Insights](#news) - [Awards and Recognition](#awards) ## Overview ****BAX Securities Law® advises on fund investment activities from fund formation, product development, marketing and sales, operations, regulatory compliance and regulatory investigations.**** BAX Securities Law® provides legal and regulatory advice to investment fund dealers, portfolio managers and investment fund managers regarding their regulatory registration, reporting and compliance requirements as well as applicable prospectus and registration exemptions. If you would like to create and manage an investment fund in Canada and require advice on structuring and developing the fund as well as applicable securities and financial services regulatory requirements, we can assist. BAX Securities Law® advises: - on the formation of ETFs, pooled funds, private equity funds, venture capital funds, mortgage investment entities, closed-end funds and real estate funds including REITs and limited partnerships; - on various asset classes including equity, debt, commodities, derivatives and digital assets; and - investment dealers, exempt market dealer, advisers and investment fund managers on registration and compliance matters. We also advise sponsors and managers of Private Equity and Venture Capital funds through every stage in the investment life cycle, from fund structuring formation and capital raising to exiting investments and the return of capital to investors. ## Key Contacts ![Barbara Hendrickson](https://baxsecuritieslaw.com/wp-content/uploads/2025/11/Barb-square.jpg) ### Barbara Hendrickson #### Founder, Award Winning Securities Lawyer Barbara has practiced in the securities and corporate areas for nearly 30 years. ## Investment Funds Law News and Insights [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-september-toronto-business-lawyers-association-monthly-meeting-2/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-souvenirpixels-1516047-scaled.jpg) ## [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-september-toronto-business-lawyers-association-monthly-meeting-2/ "baxsecuritieslawannouncestorontobusinesslawyersassociationmonthlymeeting") Toronto, August 26, 2026: BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday, September 17,… [CSA And CIRO Publish Guidance on Certain Types of Prediction Market Event Contracts](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-goumbik-590041-scaled.jpg) ## [CSA And CIRO Publish Guidance on Certain Types of Prediction](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/ "csaandciropublishguidanceoncertaintypesofprediction") The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have published Joint Canadian Securities Administrators and Canadian… [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-toronto-business-lawyers-association-monthly-meeting/) ![TBLA Toronto Business Lawyers Association 10th anniversary logo with a gold 10 and navy skyline inside a circular frame.](https://baxsecuritieslaw.com/wp-content/uploads/2026/06/TBLA-10th-Anniversary.png) ## [BAX Securities Law Announces Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-toronto-business-lawyers-association-monthly-meeting/ "baxsecuritieslawannouncestorontobusinesslawyersassociationmonthlymeeting") Toronto, June 1, 2026: BAX Securities Law is pleased to announce the 10th year anniversary of the Toronto Business Lawyers Association (TBLA). The TBLA was… [BAX Securities Law Announces April Toronto Business Lawyers Association Monthly Meeting](https://baxsecuritieslaw.com/bax-securities-law-announces-april-toronto-business-lawyers-association-monthly-meeting-2/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-luis-ruiz-1285613.jpg) ## [BAX Securities Law Announces April Toronto Business Lawyers Association Monthly](https://baxsecuritieslaw.com/bax-securities-law-announces-april-toronto-business-lawyers-association-monthly-meeting-2/ "baxsecuritieslawannouncesapriltorontobusinesslawyersassociationmonthly") BAX Securities Law is pleased to invite friends and colleagues to the next meeting on Thursday, April 16, 2026, at 9:30 am at Chefs… [Barbara Hendrickson re-appointed to BCSC Fintech Advisory Forum](https://baxsecuritieslaw.com/barbara-hendrickson-re-appointed-to-bcsc-fintech-advisory-forum/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-luis-ruiz-1285613.jpg) ## [Barbara Hendrickson re-appointed to BCSC Fintech Advisory Forum](https://baxsecuritieslaw.com/barbara-hendrickson-re-appointed-to-bcsc-fintech-advisory-forum/ "barbarahendricksonre-appointedtobcscfintechadvisoryforum") Barbara Hendrickson, founder and Managing Partner of BAX Securities Law, has been reappointed to a third two-year term as member… [CSA Reduces Regulatory Burden for Continuous Disclosure for Investment Funds](https://baxsecuritieslaw.com/csa-reduces-regulatory-burden-for-continuous-disclosure-for-investment-funds/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-cottonbro-6532337.jpg) ## [CSA Reduces Regulatory Burden for Continuous Disclosure for Investment Funds](https://baxsecuritieslaw.com/csa-reduces-regulatory-burden-for-continuous-disclosure-for-investment-funds/ "csareducesregulatoryburdenforcontinuousdisclosureforinvestmentfunds") The Canadian Securities Administrators (CSA) have published a series of Final Amendments are designed to reduce the regulatory burden on… ## Awards and Recognition - **Best Lawyers Best Canadian Law Firm**: BAX Securities Law® received this award in 2025 and 2026 - **Canadian Lawyer Top Corporate Law Boutiques**: BAX Securities Law® received this award in 2016, 2017, 2018, 2019, 2020 - **The Canadian Legal Lexpert Directory:** Barbara Hendrickson has been repeatedly recognized in the Corporate Finance & Securities Law area. --- ### [Securities Litigation, Enforcement And Compliance](https://baxsecuritieslaw.com/securities-litigation-enforcement-and-compliance/) **Published:** April 23, 2026 **Author:** Barbara Hendrickson **Content:** # **Securities Litigation, Enforcement And Compliance** We advise market participants and respondents in response to allegations of market misconduct. - [ ](https://www.facebook.com/sharer/sharer.php?u=https://baxsecuritieslaw.com/securities-litigation-enforcement-and-compliance/) - [ ](https://twitter.com/share?text=Securities%20Litigation,%20Enforcement%20And%20Compliance&url=https://baxsecuritieslaw.com/securities-litigation-enforcement-and-compliance/) - [ ](https://www.linkedin.com/shareArticle?title=Securities%20Litigation,%20Enforcement%20And%20Compliance&url=https://baxsecuritieslaw.com/securities-litigation-enforcement-and-compliance/&mini=true) - [Overview](#overview) - [News and Insights](#news) - [Awards and Recognition](#awards) ## Overview We assist with corporate finance reviews, compliance reviews, compliance audits, investigations and enforcement and other regulatory proceedings brought by the Ontario Securities Commission (OSC), the British Columbia Securities Commission (BCSC), the Canadian Investment Regulatory Organization (CIRO) as well as stock exchanges including the TSX, the TSX Venture Exchange and the CSE. We also represent clients on claims arising out of alleged securities fraud and misrepresentations, claims against investment dealers, advisors, investment fund managers, as well as claims against investment funds, REITS and other investment vehicles, in respect of problematic investment products, and investment strategies. Our founder, Barbara Hendrickson, is a former senior legal counsel at the OSC and has participated in a number of OSC securities advisory committees. Barbara brings decades of experience and knowledge of OSC decision making, and personnel and enforcement practices to assess and provide a detailed strategy to resolve your matter. ## Securities Law News [CSA And CIRO Publish Guidance on Certain Types of Prediction Market Event Contracts](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-goumbik-590041-scaled.jpg) ## [CSA And CIRO Publish Guidance on Certain Types of Prediction](https://baxsecuritieslaw.com/csa-and-ciro-publish-guidance-on-certain-types-of-prediction-market-event-contracts/ "csaandciropublishguidanceoncertaintypesofprediction") The Canadian Securities Administrators (CSA) and the Canadian Investment Regulatory Organization (CIRO) have published Joint Canadian Securities Administrators and Canadian… [CSA Publishes Updated Cybersecurity Findings and Guidance for Registered Firms](https://baxsecuritieslaw.com/csa-publishes-updated-cybersecurity-findings-and-guidance-for-registered-firms/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-thesilentman-205377-scaled.jpg) ## [CSA Publishes Updated Cybersecurity Findings and Guidance for Registered Firms](https://baxsecuritieslaw.com/csa-publishes-updated-cybersecurity-findings-and-guidance-for-registered-firms/ "csapublishesupdatedcybersecurityfindingsandguidanceforregisteredfirms") The Canadian Securities Administrators (CSA) have published CSA Staff Notice 33-322 Review of Registered Firms’ Cybersecurity Practices and Additional Guidance… [Canadian Securities Administrators Published Amendments to Allow Higher Limits for the Listed Issuer Financing Exemption](https://baxsecuritieslaw.com/canadian-securities-administrators-published-amendments-to-allow-higher-limits-for-the-listed-issuer-financing-exemption/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-vivek-chugh-157138-739987-scaled.jpg) ## [Canadian Securities Administrators Published Amendments to Allow Higher Limits for](https://baxsecuritieslaw.com/canadian-securities-administrators-published-amendments-to-allow-higher-limits-for-the-listed-issuer-financing-exemption/ "canadiansecuritiesadministratorspublishedamendmentstoallowhigherlimitsfor") The Canadian Securities Administrators (CSA) has published proposed amendments to National Instrument 45-106 Prospectus Exemptions and changes to the Companion… [Canadian Securities Administrators Publish Amendments to National Instrument 81-105 Mutual Fund Sales Practices and Other Instruments and Policies Relating to Principal Distributors](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-amendments-to-national-instrument-81-105-mutual-fund-sales-practices-and-other-instruments-and-policies-relating-to-principal-distributors/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-vivek-chugh-157138-739987-scaled.jpg) ## [Canadian Securities Administrators Publish Amendments to National Instrument 81-105 Mutual](https://baxsecuritieslaw.com/canadian-securities-administrators-publish-amendments-to-national-instrument-81-105-mutual-fund-sales-practices-and-other-instruments-and-policies-relating-to-principal-distributors/ "canadiansecuritiesadministratorspublishamendmentstonationalinstrument81-105mutual") The Canadian Securities Administrators (CSA) recently announced the publication of final amendments to the principal distributor model (the Final Amendments)… [BCSC Issues its First Whistleblower Award](https://baxsecuritieslaw.com/bcsc-issues-its-first-whistleblower-award/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/10/pexels-djpetty2-756790-scaled.jpg) ## [BCSC Issues its First Whistleblower Award](https://baxsecuritieslaw.com/bcsc-issues-its-first-whistleblower-award/ "bcscissuesitsfirstwhistlebloweraward") The British Columbia Securities Commission (BCSC) has made its first whistleblower award of $25,000 to an individual whose information contributed… [Canadian Securities Exchange Publishes Proposed Public Interest Rule Amendments – Proposed – Request for Comments](https://baxsecuritieslaw.com/canadian-securities-exchange-publishes-proposed-public-interest-rule-amendments-proposed-request-for-comments/) ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/06/pexels-kindelmedia-7979432.jpg) ## [Canadian Securities Exchange Publishes Proposed Public Interest Rule Amendments –](https://baxsecuritieslaw.com/canadian-securities-exchange-publishes-proposed-public-interest-rule-amendments-proposed-request-for-comments/ "canadiansecuritiesexchangepublishesproposedpublicinterestruleamendments") CNSX Markets Inc., operator of the Canadian Securities Exchange (CSE) is proposing amendments (the Proposed Amendments) to the CSE Listing… ## Awards and Recognition - **Best Lawyers Best Canadian Law Firm**: BAX Securities Law® received this award in 2025 and 2026 - **Canadian Lawyer Top Corporate Law Boutiques**: BAX Securities Law® received this award in 2016, 2017, 2018, 2019, 2020 - **The Canadian Legal Lexpert Directory:** Barbara Hendrickson has been repeatedly recognized in the Corporate Finance & Securities Law area. --- ### [Contact Us](https://baxsecuritieslaw.com/contact-us/) **Published:** July 1, 2015 **Author:** Ian **Content:** ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/08/GettyImages-534969258.jpg) # **Contact** BAX Securities Law® Phone: [416.601.1004](tel:14166011004) Cell: [647.403.4606](tel:16474034604) **BAX Securities Law® Toronto Office** 30 St. Patrick Street Suite 700 Toronto ON M5T 3A3 T: 416.601.1004 C: 647.403.4606 **Legal Services** If you wish to discuss retaining BAX Securities Law® to provide you with legal services, please contact: Barbara Hendrickson Managing Partner T: 416.601.1004 C: 647.403.4606 [](mailto:bhendrickson@baxsecuritieslaw.com) - [LinkedIn](#) - [Google](#) - [Facebook](#) ## Get In Touch BAX Securities Law® is one of Canada’s leading corporate securities law firms. If you wish to discuss retaining BAX Securities Law to provide you with legal services, please book a consultation or reach out via phone or email. Please enable JavaScript in your browser to complete this form. Email Name Message Name \* Email \* Message Submit![Loading](https://baxsecuritieslaw.com/wp-content/plugins/wpforms-lite/assets/images/submit-spin.svg) *Please note that prior to a formal retainer with BAX Securities Law®, we cannot guarantee or undertake to maintain unsolicited information in confidence, and if you disclose confidential information to us prior to a formal retainer you risk disclosure and adverse use of the information.* --- ### [Legal Strategy Session](https://baxsecuritieslaw.com/legal-strategy-session/) **Published:** April 29, 2026 **Author:** Barbara Hendrickson **Content:** ![](https://baxsecuritieslaw.com/wp-content/uploads/2025/08/GettyImages-534969258.jpg) ## Legal Strategy Session ## Consult with a Corporate Business Lawyer BAX Securities Law® is one of Canada’s leading corporate securities law firms. If you wish to discuss retaining BAX Securities Law to provide you with legal services, please book a consultation. Barbara Hendrickson Managing Partner T: 416.601.1004 C: 647.403.4606 [](mailto:bhendrickson@baxsecuritieslaw.com)[bhendrickson](mailto:bhendrickson@baxsecuritieslaw.com) [@baxsecuritieslaw.com](mailto:bhendrickson@baxsecuritieslaw.com) Please enable JavaScript in your browser to complete this form. Name \*First Last for and a Email \* Before we can do the session, you will need to fill out a WRD LLP Client Information Form. Please select the appropriate form below and click the link to complete it:- Verification of Business Identity Form - Verification of Individual Identity Form - Already Completed and Sent Briefly describe the matter for which you are seeking legal advice.Who are the other stakeholders in the matter that will be involved with you? Include any corporations, businesses, or other entities Which level of service are you looking for at this time \*- 15 minute consultation – $0.00 - 1 hour session – $250.00 - Formal retainer – $500.00 Stripe Credit Card \*Credit Card field is disabled, Stripe keys are missing. Terms and Conditions- I accept the terms and conditions Total$0.00 Submit![Loading](https://baxsecuritieslaw.com/wp-content/plugins/wpforms-lite/assets/images/submit-spin.svg) *Please note that prior to a formal retainer with BAX Securities Law®, we cannot guarantee or undertake to maintain unsolicited information in confidence, and if you disclose confidential information to us prior to a formal retainer you risk disclosure and adverse use of the information.* --- ### [Terms of Use](https://baxsecuritieslaw.com/terms-of-use/) **Published:** November 16, 2016 **Author:** Ian **Content:** ### Terms of Use By accessing this website you are agreeing to be bound by the terms and conditions set out below. If you do not agree with these terms and conditions, please exit from this website and do not access any other pages. At any time, we may change this website, these terms and conditions, and the information contained herein, without prior notice. It is your responsibility to check these terms and conditions for changes and updates. Your continued use of this website will be deemed to be your unconditional acceptance of those changes. These terms and conditions were last updated on August 28, 2020. ### No Legal Advice or Lawyer-Client Relationship BAX provides the information on this website (including, without limitation, hypertext links, search mechanism, portals and documents) for general information purposes only. It is neither intended as, nor should be considered, legal advice or opinions of any kind and may not be used for professional or commercial purposes. Neither the use of any such information, nor the transmission of materials or information to BAX by e-mail or otherwise, will establish any lawyer-client, contractual or other relationship between BAX and the user or sender. ### Use of Website, Disclaimer and Limitation of Liability The information on this website is provided on an “as is” and “as available” basis without any representations, warranties or conditions, whether express or implied, statutory or otherwise, including, without limitation, any representations, warranties or conditions as to quality, accuracy, completeness, currency, fitness for a particular purpose, uninterrupted access, error free operation, or the absence of computer viruses and other harmful components or corrupted data or information. BAX, its partners, agents or employees shall have no liability in connection with any loss, cost or damages whatsoever, whether direct, indirect, consequential, contingent, special, incidental, exemplary or punitive, related to or arising from this website, its non-availability, the information on it or the use thereof (including, without limitation, any defects, inaccuracies, errors or omissions in this site), including, without limitation, damages for harm to business, damages for loss of profit, business or revenues, programs or data, interruption of activities or any other pecuniary or economic loss, whether based on breach of contract, tort or delict (including negligence), infringement of intellectual property rights, strict liability, breach of warranty, failure of essential purpose, fundamental breach, breach of a fundamental term or otherwise, even if advised of the possibility thereof or reasonably foreseeable. ### Communications not Confidential BAX does not guarantee the security or confidentiality of any e-mail or other electronic communications sent to BAX personnel. If you are not an existing client of BAX, do not send BAX personnel your confidential or sensitive information until you have received his or her express request or consent to do so. You will be considered a client of BAX only after BAX has confirmed it is not conflicted to be retained by you and has otherwise consented to the retainer. ### Intellectual Property BAX retains all copyright, trade-mark and other rights in all material contained on this website, including all text and graphic images. You may download, display and print copies of these materials for private non-commercial purposes, as long as the content is not modified, the source of the material is indicated, and the BAX copyright and other notices are neither removed nor modified. No portion of this material may be used or reproduced for any other purpose, or distributed, transmitted or mirrored in any form, or by any means, without the prior written permission of BAX. ### Links This website may contain links to other sites. The provision of these links is for your convenience only, and does not constitute an endorsement, recommendation or approval of the other sites. BAX has no control over the availability or content of such sites, and any use of them is at your own risk. BAX shall have no liability related to or arising from such sites or the use thereof. ### Governing Law These terms and conditions and the use of this website shall be governed by and interpreted in accordance with the laws of the Province of Ontario and the laws of Canada applicable in the Province of Ontario, and you irrevocably attorn to the exclusive jurisdiction of the courts of Ontario. Anyone accessing this website from other jurisdictions assumes sole responsibility for compliance with local laws. --- ### [Disclaimer](https://baxsecuritieslaw.com/disclaimer/) **Published:** November 16, 2016 **Author:** Ian **Content:** © 2025 BAX Securities Advisory Services Law Corporation (“BAX”). All rights reserved. The content on this web site is provided for general information purposes only and does not constitute legal or other professional advice or an opinion of any kind. Users of this web site are advised to seek specific legal advice by contacting BAX regarding any specific legal issues. BAX does not warrant or guarantee the quality, accuracy or completeness of any information on this web site. The articles published on this web site are current as of their original date of publication, but should not be relied upon as accurate, timely or fit for any particular purpose. Accessing or using this web site does not create a lawyer-client relationship. Although your use of the web site may facilitate access to or communications with BAX via e-mail transmissions or otherwise via the web site, receipt of any such communications or transmissions by BAX does not create a lawyer client relationship. BAX does not guarantee the security or confidentiality of any communications made by e-mail or otherwise through this web site. This web site may contain links to third party web sites. Monitoring the vast information disseminated and accessible through those links is beyond our resources and BAX does not attempt to do so. Links are provided for convenience only and BAX does not endorse the information contained in linked web sites nor guarantee its accuracy, timeliness or fitness for a particular purpose. --- ### [Privacy Statement](https://baxsecuritieslaw.com/privacy-statement/) **Published:** November 16, 2016 **Author:** Ian **Content:** ### Privacy Policy BAX Securities Law (“BAX” or “we”) recognize the importance of privacy and the sensitivity of personal information. As lawyers we have professional obligations regarding the confidentiality of information we receive from our clients within a lawyer-client relationship. We are committed to protecting personal information we hold in accordance with law. This Privacy Policy outlines how we manage personal information and safeguard privacy. ### Personal Information Personal information means information about an identifiable individual, but does not include the name, title or business address or telephone number of an employee of an organization. ### PIPEDA As of January 1, 2004, all Canadian organizations engaged in commercial activities must comply with the Personal Information Protection and Electronic Documents Act (“PIPEDA”) and the Canadian Standards Association Model Code for the Protection of Personal Information incorporated by reference into PIPEDA. These obligations extend to lawyers and law firms, including BAX. ### Personal Information at BAX BAX provides legal services to a wide range of clients. In doing so, we often collect and use personal information. As well, BAX sends to individuals information and marketing materials concerning developments in the law and its services. ### Collecting Personal Information We collect personal information fairly and in accordance with the law. Generally, we collect your personal information directly from you. Such collection may be done at the start of our relationship or during the course of our representation or retainer. ### Sometimes we may obtain information about you from other sources including, for example: - from a government agency or registry; - other professionals who serve you, such as your accountant; - other parties or witnesses in the context of litigation; and - other parties or participants in a commercial transaction. ### Consent In most cases, if we collect, use, or disclose your personal information, we will obtain your consent. Sometimes we will ask for your consent in writing, but in some cases, we may accept your oral consent. Sometimes your consent may be implied through your conduct with us or the nature of our retainer. Should you withdraw your consent, that may impact on our ability to serve you and to maintain our relationship. ### Use of Personal Information We use your personal information to provide legal advice and services to you, to administer our client (time and billing) databases, to build and to maintain the firm’s expertise and knowledge, and to include you in our information distribution and marketing activities. If you tell us that you no longer wish to receive information about developments in the law or our services, you can ask us not to send any further material. ### Disclosure of Personal Information BAX does not disclose your personal information to third parties to enable them to market their products and services. - **Under certain circumstances BAX may disclose your personal information. Some examples are:** - when you have consented to the disclosure; - when we are required or authorized by law to do so, including, for example, if a court issues a warrant or a subpoena; - in order to comply with the requirements of the Law Society of Upper Canada, the regulatory body that governs the practice of law in Ontario; - when the legal services we are providing to you requires us to give your information to third parties (for example a lender in a real estate mortgage transaction) your consent will be implied, unless you tell us otherwise; - where it is necessary to collect fees or disbursements; - if we engage a third party to provide administrative services to us (like computer back-up services, archival file storage, or insurance) and the third party is bound by obligations regarding privacy which are consistent with this policy; - in the event of a merger by or growth of BAX; - if we engage expert witnesses on your behalf; or - if we retain another law firm (such as, for example, law firms in other jurisdictions) on your behalf. ### Updating Your Information Since we use your personal information to provide legal services to you, it is important that the information be accurate and up-to-date. If during the course of the retainer, any of your information changes, please inform us so that we can make any necessary changes. We may also periodically inquire of you whether your personal information is accurate and up-to-date. ### Securing Personal Information BAX takes precautions to ensure that your personal information is kept safe from loss, unauthorized access, modification or disclosure. Among the steps taken to protect your personal information are: - premises security; - confidentiality policies as part of our professional obligations; - deploying technological safeguards like security software and firewalls to prevent unauthorized computer access or “hacking”; and - internal password and security policies. ### E-mail You should be aware that e-mail is not an entirely secure medium, and you should be aware of this when contacting us to send personal or confidential information. ### Accessing Personal Information You may ask for access to personal information we hold about you. Detailed requests which require archive or other retrieval costs may be subject to our normal professional and disbursement fees. Your rights to access your personal information are not absolute. There are a number of situations where we may deny access. If we deny your request for access to, or refuse a request to correct personal information, we will provide a reason or reasons for doing so. ### Credit Bureaus To help us make credit decisions about clients, to try to prevent fraud, and to check the identity of new clients, on occasion we may request information about you from the files of consumer reporting agencies. ### Web Site Our website contains links to other sites, which are not governed by this Policy. On our website, like most other commercial websites, we may monitor traffic patterns, site usage and related site information in order to optimize our web service. We may provide aggregated information to third parties, but these statistics do not include any identifiable personal information. BAX does not use cookies nor does BAX use any electronic means to automatically collect personal information from you or your computer; however, web servers used by BAX will automatically collect IP addresses and we may view our web server IP log from time to time to prevent fraudulent acts and possible network attacks. ### Requests for Access If you have any questions, or wish to access your personal information, please contact the lawyer with whom you normally deal or write to our Privacy Contact: Barbara Hendrickson: 647 403 4606. ### If you are not satisfied with our response, the Privacy Commissioner of Canada can be reached at: 112 Kent Street Ottawa, Ontario, K1A 1H3 1.800.282.1376. ### Changes to this Privacy Policy BAX reviews all of its policies and procedures and we may change this Privacy Policy from time to time --- ## Categories ### [Financial](https://baxsecuritieslaw.com/category/financial/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada and advises financial technology companies, banks, and investors on the intersection of technology, finance, and regulation. BAX navigates complex issues regarding digital assets, payment systems, AI-driven services, and regulatory compliance (FINTRAC, OSFI). These lawyers facilitate innovation while ensuring compliance with Canadian financial laws --- ### [Governments](https://baxsecuritieslaw.com/category/governments/) **Description:** BAX Securities Law™ has direct experience dealing with Canadian securities and financial services regulatory bodies including the Ontario Securities Commission, the British Columbia Securities Commission and other Canadian regulatory authorities. --- ### [News & Updates](https://baxsecuritieslaw.com/category/news-updates/) **Description:** The latest corporate securities law news, insights and activity. BAX Securities Law® has been repeatedly recognized as one of Canada’s top corporate law boutiques by Canadian Lawyer Magazine. The recognition acknowledges BAX Securitie’s nationwide legal expertise, deep industry knowledge, quality legal services, and willingness to go above and beyond to help their clients achieve their goals. --- ### [Business Law](https://baxsecuritieslaw.com/category/business-law/) **Description:** We advise on various asset classes including equity, debt, commodities, derivatives, crypto assets, private equity, venture capital, real estate and mortgages including syndicated mortgages. --- ### [Marketing & Business Development](https://baxsecuritieslaw.com/category/marketing-business-development/) **Description:** BAX Securities Law® is one of Toronto’s leading capital markets boutique law firms. Our experience includes innovative products and structures in the proptech, fintech, debt and crypto spaces. --- ### [Corporate securities lawyer](https://baxsecuritieslaw.com/category/corporate-securities-lawyer/) **Description:** BAX Securities Law Toronto is one of the leading boutique law firms in Canada and assists clients with mergers & acquisitions, regulatory compliance with the Ontario Securities Commission (OSC), equity/debt financing, and corporate governance. --- ### [Securities lawyer](https://baxsecuritieslaw.com/category/securities-lawyer/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada focusing on laws governing investments, shares, bonds, and financial instruments, handling both transactional work (regulatory compliance, filings) and litigation (fraud, disputes). They assist companies with public offerings and mergers while protecting investor rights and navigating investigations by regulatory bodies like the Ontario Securities Commission (OSC) --- ### [Securities litigation lawyer](https://baxsecuritieslaw.com/category/securities-litigation-lawyer/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada representing individuals and corporations in complex disputes involving investment losses, fraud, and regulatory breaches. We handle cases regarding insider trading, market manipulation, shareholder disputes, and corporate governance. --- ### [FSRA](https://baxsecuritieslaw.com/category/fsra/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada in Toronto handling FSRA (Financial Services Regulatory Authority of Ontario) matters including insurance, mortgage brokering, syndicated mortgages, regulatory defense and professional regulation. --- ### [OSC](https://baxsecuritieslaw.com/category/osc/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada assists clients with matters regulated by the Ontario Securities Commission (OSC), is an independent Crown agency regulating Ontario’s capital markets. The OSC protects investors from unfair or fraudulent practices, fosters fair/efficient markets, and oversees market participants by enforcing the Securities Act and Commodity Futures Act. It acts as a primary regulator for investment firms and advisors in Ontario. --- ### [Business lawyer](https://baxsecuritieslaw.com/category/business-lawyer/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada which advises companies, startups, and entrepreneurs on corporate law, including business formation, contract drafting, employment issues, and compliance with provincial/federal laws. We also assist with shareholder agreements, commercial leasing, intellectual property, and mergers/acquisitions, often referred to as corporate lawyers or commercial lawyers in the GTA. --- ### [Mergers and acquisitions lawyer](https://baxsecuritieslaw.com/category/mergers-and-acquisitions-lawyer/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada advising businesses, founders, and investors on purchasing, selling, or merging companies, handling complex transactions, due diligence, and negotiations to ensure regulatory compliance in deals like share/asset purchases, take-over bids, and restructuring, serving sectors such as technology, finance, and mining. --- ### [Crypto lawyer](https://baxsecuritieslaw.com/category/crypto-lawyer/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada focusing on the complex, evolving regulations surrounding digital assets, blockchain technology, and NFTs providing expertise on compliance (FINTRAC, securities law), and corporate structuring for businesses and individuals. BAX assist crypto exchanges and other money services businesses (MSBs) with registration, FINTRAC, and KYC/AML compliance. BAX Offers advice on token generation events (ICOs) and determining if tokens comply with Ontario securities regulations --- ### [Securities enforcement lawyer](https://baxsecuritieslaw.com/category/securities-enforcement-lawyer/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada representing companies, financial institutions, and individuals facing investigations, audits, or civil charges from regulators like the Ontario Securities Commission (OSC) defending against allegations of fraud, insider trading, and compliance failures, managing the entire process from initial inquiries to settlements or litigation. --- ### [Corporate lawyer](https://baxsecuritieslaw.com/category/corporate-lawyer/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada advising businesses on their legal rights, obligations, and duties, focusing on commercial transactions, compliance, and governance. BAX facilitates business operations by drafting contracts, managing mergers, overseeing acquisitions, and ensuring compliance with regulations. --- ### [Investment fund lawyer](https://baxsecuritieslaw.com/category/investment-fund-lawyer/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada assisting clients in structuring, forming, and managing investment vehicles like hedge funds, real estate investment trusts, limited partnerships, venture capital funds, private equity funds, and mutual funds ensuring compliance with complex regulatory securities requirements (e.g., OSC rules). --- ### [MICs mortgage investment lawyer](https://baxsecuritieslaw.com/category/mics-mortgage-investment-lawyer/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada assisting clients with establishing, structuring, and maintaining MICs—companies that pool investor funds to lend as mortgages. BAX ensures compliance with securities and financial service regulations drafting documentation for incorporation, management agreements, offerings including offering memoranda and shareholder relations. --- ### [P2P peer to peer lending](https://baxsecuritieslaw.com/category/p2p-peer-to-peer-lending/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada assisting clients in the legal aspects of online lending platforms that connect borrowers directly with investors, bypassing traditional banks ensuring compliance with financial regulations, securities laws, and consumer protection rules. --- ### [Capital markets lawyer](https://baxsecuritieslaw.com/category/capital-markets-lawyer/) **Description:** BAX Securities Law is one of the leading boutique law firms in Canada assisting clients with buying and selling securities (debt or equity) to raise capital advising issuers, investment banks, and investors on complex financial transactions, securities regulatory compliance, and governance, including IPOs, private placements, and debt offerings --- ## Tags ### [Announcements](https://baxsecuritieslaw.com/tag/announcements/) --- ### [CBA solo firms small firms secretary treasurer](https://baxsecuritieslaw.com/tag/cba-solo-firms-small-firms-secretary-treasurer/) --- ### [BAXSecurtiesLaw](https://baxsecuritieslaw.com/tag/baxsecurtieslaw/) --- ### [Proposed Amendments to National Instrument 31-103 #ProposedCustodyAmendments](https://baxsecuritieslaw.com/tag/proposed-amendments-to-national-instrument-31-103-proposedcustodyamendments/) --- ### [clearedoverthecounterderivatives. 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