Source: The Ontario Securities Commission website

TORONTO - OSC Publishes Investor Office Activity Report for 2015-2016

The report provides an update on the OSC Investor Office’s policy, research, and education and outreach initiatives since its launch last year and outlines its key areas of focus.

More information can be found on the Ontario Securities Commission website HERE

TORONTO – The Ontario Securities Commission will hold a seminar on the background and content of CSA Consultation Paper 33-404. Attend the seminar on Thursday, June 23, 2016.

Description: This seminar will provide an overview of CSA Consultation Paper 33-404 Proposals to Enhance the Obligations of Advisers, Dealers, and Representatives Toward Their Clients, including the proposed targeted reforms (e.g. conflicts, KYC, KYP, suitability, use of titles) and proposed regulatory best interest standard described in the Paper.

Who should attend: Dealers and advisers who are interested in the proposals in CSA Consultation Paper 33-404 and who would like more information about this initiative.

Time and location: 22nd Floor Training Room
Ontario Securities Commission
20 Queen Street West
Toronto, ON

Thursday, June 23, 2016
2:00 p.m. - 4 p.m.

For more information and to register click HERE

For Media Inquiries:

media_inquiries@osc.gov.on.ca

For Investor Inquiries:
OSC Contact Centre
416-593-8314
1-877-785-1555 (Toll Free)

Please review document HERE

Click HERE to read to comments from the PCMA.

For Immediate Release
November 5, 2015

Regulators Publish Crowdfunding Exemption And Registration Framework For Funding Portals

Toronto – The securities regulatory authorities in Manitoba, Ontario, Québec, New Brunswick and Nova Scotia (collectively, the participating jurisdictions) today published in final form Multilateral Instrument 45-108 Crowdfunding, which introduces a crowdfunding prospectus exemption for issuers as well as a registration framework for funding portals.

The MI 45-108 crowdfunding regime will enable businesses to benefit from greater access to capital from a large number of investors online, through a funding portal operated by a registered dealer. “This new crowdfunding regime is another way to facilitate capital raising for start-ups and small and medium-sized enterprises while protecting the interests of investors,” said Louis Morisset, CSA Chair and President and CEO of the Autorité des marchés financiers.

Among the measures adopted to protect investors, issuers will be required to distribute their securities through a registered funding portal. These funding portals will fulfill certain gatekeeper functions that include reviewing the issuer’s disclosure and obtaining background checks on the issuer and its directors, executive officers and promoters.

In addition, investment limits based on the investor’s income and financial resources have been adopted as a means of reducing their exposure to a risky investment. When using the crowdfunding prospectus exemption, issuers will only be able to offer non-complex securities, will be prohibited from advertising and will be subject to a standard of liability on the information they present to investors.

The MI 45-108 crowdfunding regime will coexist and is viewed to be complementary with the start-up crowdfunding exemptions by those jurisdictions that adopted it on May 14, 2015 in Manitoba, Saskatchewan, Québec, New Brunswick and Nova Scotia.

Provided all necessary Ministerial approvals are obtained, MI 45-108 will come into force in the participating jurisdictions on January 25, 2016.

The Financial and Consumer Affairs Authority of Saskatchewan (FCAA) will be republishing MI 45-108 for a 60 day comment period.

The CSA, the council of the securities regulators of Canada’s provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.

For more information:

Kristen Rose
Ontario Securities Commission
416-593-2336

Sylvain Théberge
Autorité des marchés financiers
514-940-2176

Ainsley Cunningham
Manitoba Securities Commission
204-945-4733

Andrew Nicholson
Financial and Consumer Services
Commission, New Brunswick
506-658-3021

Tanya Wiltshire
Nova Scotia Securities Commission
902-424-8586

Noel Busse
Financial and Consumer Affairs
Authority of Saskatchewan
306-798-4160

Regulators Finalize Offering Memorandum Exemption

October 29, 2015, Toronto – The securities regulatory authorities in Alberta, New Brunswick, Nova Scotia, Ontario, Québec and Saskatchewan (collectively, the participating jurisdictions) today published Multilateral CSA Notice of Amendments to National Instrument 45-106 Prospectus Exemptions Relating to the Offering Memorandum Exemption.

The amendments will introduce an offering memorandum prospectus exemption in Ontario and will modify the existing offering memorandum exemption in Alberta, New Brunswick, Nova Scotia, Québec and Saskatchewan to strengthen investor protection. As a result of the amendments, the offering memorandum exemption will now be available in all jurisdictions of Canada.

“These amendments will enhance access to capital across Canada while introducing key investor protection measures,” said Louis Morisset, Canadian Securities Administrators (CSA) Chair and President and CEO of the Autorité des marchés financiers.

The following are some of the key investor protection measures included in the offering memorandum exemption:

• Non-reporting issuers will be required to, among other measures, provide investors with audited annual financial statements and an annual notice describing how the proceeds raised under the offering memorandum exemption were used.
• Any marketing materials will be required to be incorporated by reference in the offering memorandum so that they are subject to the same liability as the disclosure provided in the offering memorandum in the event of a misrepresentation.
• Individual investors relying on the offering memorandum exemption will be subject to investment limits in most cases.
• All investors will be required to sign a risk acknowledgement form.

The offering memorandum exemption was designed to facilitate capital-raising by allowing issuers to solicit investments from a wider range of investors than they would be able to under other prospectus exemptions, provided that certain conditions are met.

Provided all necessary ministerial approvals are obtained, the final amendments will come into force in Ontario on January 13, 2016 and in Alberta, New Brunswick, Nova Scotia, Québec and Saskatchewan on April 30, 2016.

The final amendments do not modify the OM exemption that exists in any CSA jurisdiction other than the participating jurisdictions.

The CSA, the council of the securities regulators of Canada’s provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.

For more information:

Richard Gilhooley
British Columbia Securities Commission
604-899-6713

Mark Dickey
Alberta Securities Commission
403-297-4481

Kristen Rose
Ontario Securities Commission
416-593-2336

Sylvain Théberge
Autorité des marchés financiers
514-940-2176

Ainsley Cunningham
Manitoba Securities Commission
204-945-4733

Andrew Nicholson
Financial and Consumer Services
Commission, New Brunswick
506-658-3021

Tanya Wiltshire
Nova Scotia Securities Commission
902-424-8586

Janice Callbeck
PEI Securities Office
Office of the Attorney General
902-368-6288

Don Boyles
Office of the Superintendent of Securities
Newfoundland and Labrador
709-729-4501

Rhonda Horte
Office of the Yukon Superintendent
of Securities
867-667-5466

Shamus Armstrong
Nunavut Securities Office
867-975-6587

Tom Hall
Northwest Territories
Securities Office
867-873-7490

Noel Busse
Financial and Consumer Affairs
Authority of Saskatchewan
306-798-416

September 11, 2015

TORONTO - With the December 1 deadline approaching, OSC’s registrant outreach program will be offering guidance on how to complete your Ontario capital markets participation fee forms at an upcoming registrant outreach seminar and webinar.

This mini-seminar will give registrants and unregistered capital markets participants a refresher on the calculation and filing of the participation fees, in advance of the December 1, 2015 filing deadline. The seminar will highlight the changes to OSC Rule 13-502 Fees that are applicable to registrants and unregistered capital markets participants, which came into effect on April 6, 2015. Staff will also discuss key issues and provide examples of common errors related to the calculation and filing of the participation fees.

Please note the following important dates:

September 15 – Participation Fees Calculation – Webinar
September 17 – Participation Fees Calculation – In-person Seminar
December 01 – Participation fee forms due (including unregistered investment fund managers)
December 31 – Participation fees due (including unregistered investment fund managers)
Late fees will apply for forms and participation fees submitted after the due dates.

Please note: All firms will use their financial year ending in 2015 to calculate their 2015 participation fees.

We encourage you to sign up for OSC's seminar or webinar. For more details, refer to the Registrant Outreach September schedule of events.

For further information, please use the following references:

1.   OSC Rule 13-502 Fees
2.    OSC Rule 13-503 (Commodity Futures Act) Fees

For more information, contact RegistrantOutreach@osc.gov.on.ca

Thank you!

August 4, 2015

TORONTO - Staff of the Compliance and Registrant Regulation Branch of the Ontario Securities Commission is excited to announce three new educational seminars to its Registrant Outreach program for the fall of 2015.

The Registrant Outreach program was launched in 2013 and its mission is to promote strong proactive compliance practices by opening the lines of communication between the OSC and Chief Compliance Officers, as well as other senior officers of registrants.

The new seminars will include a mini-refresher on the participation fee calculation required under OSC Rule 13-502 Fees, and an overview of the upcoming Annual Summary Report for Dealers, Advisers and Investment Fund Managers that will be published in the early fall. The OSC will also update registrants on amendments to National Instrument 45-106 Prospectus Exemptions, and discuss new capital raising exemptions that are expected to come into force later this year. Seminars will once again be made available to attend in-person or via webinar.

To review the descriptions of each seminar and to register, please visit the dedicated outreach web page.

As an additional resource, Staff would also like to remind registrants of our Topical Guide for Registrants which is designed to assist registrants and other stakeholders to locate topical guidance regarding compliance and registrant regulation matters.

For more information, contact RegistrantOutreach@osc.gov.on.ca

July 14, 2015

TORONTO – The Ontario Securities Commission (OSC) today published OSC Staff Notice 51-725 Corporate Finance Branch 2014-2015 Annual Report.

This report provides key information to the individuals and entities the OSC regulates, as well as their advisors, to help them comply with regulatory obligations. It contains observations and guidance from compliance work conducted by the Corporate Finance Branch in fiscal 2015 in several areas, including continuous disclosure and prospectus reviews.

“We strongly encourage issuers, insiders and their advisors to review the report and to use the findings and guidance presented in the report to inform and strengthen their compliance with Ontario securities law,” said Huston Loke, Director of Corporate Finance at the OSC.

The report also provides details on the branch’s policy initiatives in fiscal 2015, including an update on the OSC’s exempt market initiatives. The exempt market is an integral part of the Ontario capital markets and the OSC has been engaged in a review since 2012, considering ways to foster greater access to capital for businesses while protecting the interests of investors. As part of this ongoing effort, the OSC anticipates publication in final form of an offering memorandum prospectus exemption and a crowdfunding regime and their delivery to the Minister of Finance for decision in the fall of this year.

The mandate of the OSC is to provide protection to investors from unfair, improper or fraudulent practices and to foster fair and efficient capital markets and confidence in the capital markets. Investors are urged to check the registration of any persons or company offering an investment opportunity and to review the OSC investor materials available at http://www.osc.gov.on.ca

-30-

For Media Inquiries:

media_inquiries@osc.gov.on.ca

For Investor Inquiries:

OSC Contact Centre

416-593-8314

1-877-785-1555 (Toll Free)

Last week The Canadian Securities Administrators (CSA) announced the adoption of two sets of amendments to National Instrument 45-106 Prospectus and Registration Exemptions (NI 45-106).

The first set of amendments relates to the accredited investor prospectus exemption (AI exemption) and the minimum amount investment prospectus exemption (MA exemption). These amendments are intended to address investor protection concerns. Among other things, the amendments:

1. Introduce a new risk acknowledgement form for individual accredited investors that describes, in plain language, the categories of individual accredited investor and identifies the key risks associated with purchasing securities in the exempt market;
2. Provide expanded guidance on the steps a seller should take to verify the status of purchasers acquiring securities under prospectus exemptions, including the AI exemption; and
3. Restrict the MA exemption to distributions to non-individual investors.

In Ontario, the definition of accredited investor is also being amended to allow fully managed accounts to purchase investment fund securities using the managed account category of the AI exemption, as is permitted in other Canadian jurisdictions. This change will harmonize this category of the AI exemption in Canada. 

For more information please click  HERE

 British Columbia Securities Commission released a Notice of Varied BC Instrument 32-517 Exemption from Dealer Registration Requirement for Trades in Securities of Mortgage Investment Entities.

BC Securities Commission has extended BC Instrument 32-517 Exemption from Dealer Registration Requirement for Trades in Securities of Mortgage Investment Entities, until December 31, 2016.
For more information, click HERE.

The Canadian Securities Administrators (CSA) has released final amendments to NI 31-103. The summary of changes is outlined below. For more information, click HERE.

The PCMA submitted its comment letter in relation to these amendments in March 2014, which can be reviewed HERE.

The PCMA is a strong national voice for the private capital markets industry and represents the interests of exempt market dealers, exempt market issuers and other private capital markets professionals. The PCMA monitors key issues affecting the private capital markets and ensures our members’ voices are heard. For all comment letters please visit our Advocacy section HERE.

SUMMARY OF CHANGES TO THE INSTRUMENT

This annex summarizes the Amendments. We reference the sections of the Rule except where otherwise indicated. This annex contains the following sections:

1. Amendments to NI 31-103, 31-103CP and the forms

2. Amendments to NI 33-109, 33-109CP and the forms

3. Amendments to NI 52-107 and 52-107CP

If all necessary ministerial approvals are obtained, the Amendments will come into force on January 11, 2015.

Amendments to NI 31-103, 31-103 CP and the forms

Part 1 Interpretation

Section 1.1 [definitions of terms used throughout this Instrument]

We have added definitions for the following terms in section 1.1:

• designated rating

• designated rating organization

• DRO affiliate

• principal regulator

• sub-adviser

Section 1.3 [information may be given to the principal regulator]

We clarified the delivery and submission requirement under NI 31-103, by providing that deliveries and submissions may generally be made to the principal regulator.

Section 1.3 [fundamental concepts] of 31-103CP

We added guidance in section 1.3 of 31-103CP to clarify the application of the business trigger to start-up entities. This guidance acknowledges that issuers may not actively carry on their activities during their start-up stage, and provides indications on, among other things, active solicitation through directors, officers and other employees of the issuer.

We also amended the guidance on venture capital and private equity to clarify when venture capital and private equity investing activities may trigger the requirement to register.

Part 3 Registration requirements -- individuals

Section 3.3 [time limits on examination requirements]

We amended section 3.3 to codify relief from section 3.3 [time limits on examination requirements] in respect of examinations and programs in sections 3.7 [scholarship plan dealer -- dealing representative] if the registrant was registered as a dealing representative of a scholarship plan dealer when NI 31-103 came into force. These changes also codify relief from section 3.3 in respect of examinations and programs in section 3.9 [exempt market dealer -- dealing representative] if the registrant was registered in Ontario or Newfoundland and Labrador as a dealing representative of a limited market dealer when NI 31-103 came into force. We intend to repeal the existing orders granting the relief when the Amendments come into force.

Sections 3.6 [mutual fund dealer -- chief compliance officer], 3.8 [Scholarship plan dealer -- chief compliance officer] and 3.10 [exempt market dealer -- chief compliance officer] -- chief compliance officer experience requirements for mutual fund dealers, scholarship plan dealers and exempt market dealers

We amended section 3.6 [mutual fund dealer -- chief compliance officer], section 3.8 [scholarship plan dealer -- chief compliance officer] and section 3.10 [exempt market dealer -- chief compliance officer] of NI 31-103 to add an experience component to the proficiency requirements for chief compliance officers of dealer firms. This now forms part of the proficiency requirement for chief compliance officers of dealers, in line with the proficiency requirements applicable to chief compliance officers of portfolio managers and investment fund managers.

Sections 3.11 [portfolio manager -- advising representative] and 3.12 [portfolio manager -- associate advising representative] -- Relevant investment management experience

We included guidance in 31-103CP about what we may consider to be relevant investment management experience, which should be considered by registered firms in the following situations:

• making hiring decisions

• preparing and reviewing applications to be submitted

For specific examples, we refer you to the CSA Staff Notice 31-332 Relevant Investment Management Experience for Advising Representatives and Associate Advising Representatives of Portfolio Managers published on January 17, 2013.

Part 4 Restrictions on registered individuals

Section 4.1 [restriction on acting for another registered firm]

We clarified the scope of section 4.1 by taking into account multi-jurisdictional registration. We will consider all of the individual's employment activities, including outside business activities, with one or more registered firms in any jurisdiction of Canada.

Part 7 Categories of registration for firms

Section 7.1 [dealer categories] -- exempt market dealers

We amended section 7.1 [dealer categories] to restrict the activities that exempt market dealers may conduct and prohibit exempt market dealers from conducting brokerage activities (trading securities listed on an exchange in foreign or Canadian markets). Exempt market dealers are now prohibited from trading freely tradeable exchange-traded securities off marketplace unless there is reliance on a further exemption. We clarified the guidance in the Companion Policy to indicate what activities exempt market dealers can, and cannot, engage in.

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Subsection 7.1(5) will come into force on July 11, 2015.

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Part 8 Exemptions from the requirement to register

We amended Part 8 of NI 31-103 as follows:

New sections 8.0.1, 8.22.2 and 8.26.2 -- Removal of exemptions for registrants for activities that can be conducted under their registration

We added new sections 8.0.1, 8.22.2 and 8.26.2. These sections prohibit a registrant from relying on exemptions in Part 8 of NI 31-103 if they are registered in the local jurisdiction to conduct the activities. This prohibition does not apply to exemptions under local securities legislation.

Section 8.5 [trades through or to a registered dealer]

We amended section 8.5 [trades through or to a registered dealer] in relation to the exemption for trades made through a registered dealer, by removing the word "solely" which had created ambiguities, and by clarifying which acts in furtherance of the trades contemplated under this exemption are permitted. We added a condition so that the exemption is not available if the person relying on the exemption solicits or contacts any person or company that is a purchaser in relation to the trade. We have revised the Companion Policy to reflect these changes and to include examples relating to the use of the exemption.

New section 8.5.1 [trades through a registered dealer by registered adviser]

We added a new section 8.5.1 [trades through a registered dealer by registered adviser] which provides an exemption from the dealer registration requirement for registered advisers. This clarifies that incidental trading activities by registered advisers do not require registration as a dealer, as long as the trades are executed through a dealer registered in a category that permits the trade or a dealer operating under an exemption from the dealer registration requirement. We have revised the Companion Policy to reflect this change.

Section 8.15 [Schedule III banks and cooperative associations -- evidence of deposit]

We clarified subsection 8.15(2) by providing that the exemption does not apply in Alberta, as an equivalent exemption is contained in the Securities Act (Alberta).

Sections 8.18 [international dealer] and 8.26 [international adviser]

We have removed the definition of "Canadian permitted client" in these sections and reverted to the use of the term "permitted client", as defined in section 1.1.

Section 8.20 [exchange contract -- Alberta, British Columbia, New Brunswick and Saskatchewan]

We amended section 8.20 [exchange contract -- Alberta, British Columbia, New Brunswick and Saskatchewan] to harmonize its application with the changes made to section 8.5 [trades through or to a registered dealer] and to limit its general application.

New section 8.20.1 [exchange contract trades through or to a registered dealer -- Alberta, British Columbia, New Brunswick and Saskatchewan]

In response to comments, we have added this section to parallel new section 8.5.1 [trades through a registered dealer by registered adviser] for exchange contracts in Alberta, British Columbia, New Brunswick and Saskatchewan.

New section 8.22.1 [Short-term debt]

We added a new exemption that contains the same conditions as the parallel orders issued by all CSA members except Ontario, with a new condition limiting the use of the exemption to trades with permitted clients.

We plan to repeal the existing orders when this new exemption comes into force, allowing for a six-month transition period.

In Ontario, there are alternate exemptions from the dealer registration requirement that are available for trading in short-term debt instruments, such as the exemptions in section 35.1 of the Securities Act (Ontario) and section 4.1 of Ontario Securities Commission Rule 45-501 Ontario Prospectus and Registration Exemptions.

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Section 8.22.1 will come into force on July 11, 2015.

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Section 8.24 [IIROC members with discretionary authority]

We added guidance in 31-103CP on the adviser registration exemption that is available to members of the Investment Industry Regulatory Organization of Canada (IIROC) (or dealing representatives acting on their behalf) that act as advisers to a client's managed account. The guidance clarifies that this exemption is available for all managed accounts, including where the client is a pooled fund or investment fund.

Section 8.26 [international adviser]

We amended paragraph 8.26(4)(b) to harmonize its application with paragraph 8.26.1(2)(b).

New section 8.26.1 [international sub-adviser]

We added a new section 8.26.1 [international sub-adviser] to codify the current relief from the adviser registration requirement for certain non-resident sub-advisers, which has been available in Ontario under Ontario Securities Commission Rule 35-502 Non-Resident Advisers, in Québec under decision N 2009-PDG-0191 and in other jurisdictions on a discretionary basis. In response to comments, we removed the proposed "chaperoning" conditions.

Section 8.28 [capital accumulation plan exemption]

We clarified our intent that the exemption for capital accumulation plans is only available to plan sponsors and plan service providers in respect of activities relating to a capital accumulation plan. We removed the condition in the exemption that the person does not act as an investment fund manager other than for an investment fund that is an investment option in a capital accumulation plan. The intention of this condition was to prohibit the exemption from being used if the person was otherwise required to be registered as an investment fund manager. We added a new section 8.26.2 [general condition to investment fund manager registration requirement exemptions] prohibiting the use of this exemption where the person is registered as an investment fund manager. If the activities of a plan sponsor or service provider that require investment fund manager registration are not solely related to capital accumulation plans, they will be required to register.

Part 11 Internal controls and systems

Sections 11.9 [registrant acquiring a registered firm's securities or assets] and 11.10 [registered firm whose securities are acquired]

We amended NI 31-103 and 31-103CP to streamline and clarify the process for reviewing the notices required under sections 11.9 and 11.10, by allowing for the acquisition notices to be filed with the principal regulator of the registered firm. Notices must be filed with the principal regulator of the acquirer and the target registered firm (where the principal regulator is the same for both the acquirer and the target firms, then only one notice needs to be filed with the principal regulator). The principal regulator will share the notice with the other regulators, and will coordinate the review with them.

We clarified which securities and asset acquisitions are subject to the notice requirement, namely an initial acquisition of a direct or indirect ownership interest, beneficial or otherwise, in 10% or more of the voting securities of a firm registered in Canada or in any foreign jurisdiction. Certain exceptions to the notice requirement are repealed since they are no longer relevant or required.

We added guidance in 31-103CP for acquirers or acquired firms in the preparation of the acquisition notices, with suggestions on the information to be included in these notices.

We remind IIROC dealer members that they are subject to sections 11.9 and 11.10 and therefore are required to file these notices with the applicable CSA regulators, despite the fact that IIROC has its own review and approval process.

Part 12 Financial condition

Section 12.2 [notifying the regulator or the securities regulatory authority of a subordination agreement]

We amended section 12.2 [notifying the regulator or the securities regulatory authority of a subordination agreement] to clarify the requirements relating to subordination agreements and the exclusion of non-current related party debt subordinated under these agreements from the calculation of excess working capital on Form NI 31-103F1. These changes are reflected in the Companion Policy and Form NI 31-103F1.

Section 12.12 [delivering financial information -- dealer]

We amended subsection 12.12(3) to clarify when an exempt market dealer is exempt from the requirement to deliver financial information under subsection 12.12(2).

Section 12.14 [delivering financial information -- investment fund manager]

We added Form NI 31-103F4 Net Asset Value Adjustments on which an investment fund manager will report net asset value (NAV) adjustments as required by section 12.14. In response to comments, we made several changes to this form.

Part 13 Dealing with clients -- individuals and firms

Section 13.4 [identifying and responding to conflicts of interest]

We added guidance in 31-103CP about conflicts of interest in relation to registered representatives that serve on the boards of reporting issuers or have outside business activities. CSA Staff Notice 31-326 Outside Business Activities issued on July 15, 2011 and Multilateral Policy 34-202 Registrants Acting as Corporate Directors, amended effective September 28, 2009, will be repealed.

New section 13.17 [exemption from certain requirements for registered sub-advisers]

We added section 13.17 [exemptions from certain requirements for registered sub-adviser] to exempt a registered adviser who is acting as a sub-adviser to a registered adviser or registered dealer from certain client obligations which may not be necessary in a sub-advisory arrangement, or if necessary, are customized to the relevant business needs and agreed to contractually. In response to comments, we removed the proposed "chaperoning" conditions.

2. Amendments to NI 33-109, 33-109CP and the forms

Drafting changes

We have made various drafting changes to NI 33-109 and the forms and clarifications to the guidance in 33-109CP, to codify staff administrative practice that is in keeping with the original intent of NI 33-109, the forms and 33-109CP.

Business locations

We added a definition of "business location" in section 1.1 [definitions] of NI 33-109 that confirms a business location includes a registered individual's residence if regular and ongoing activity that requires registration is carried out from the residence or if records relating to an activity that requires registration are kept at the residence. We made amendments throughout NI 33-109, 33-109CP and the forms relating to the use of this new defined term.

Reinstatement

Currently, individual registrants changing sponsoring firms may be required to file a Form 33-109F4 Registration of Individuals and Review of Permitted Individuals if there have been changes to certain previous disclosures. We amended section 2.3 [reinstatement] of NI 33-109 and Form 33-109F7 Reinstatement of Registered Individuals and Permitted Individuals to allow the filing of this form even when certain regulatory disclosures have changed.

Reporting changes for individuals

We added a new paragraph 4.1(4)(d) to NI 33-109 and guidance in 33-109CP that Form 33-109F2 Change or Surrender of Individual Categories be used to report a change to any information in Schedule C of Form 33-109F4 Registration of Individuals and Review of Permitted Individuals.

Criminal disclosure

We amended Item 14 of Form 33-109F4 Registration of Individuals and Review of Permitted Individuals to clarify what disclosures are required.

Principal regulator for foreign firms

We amended Item 2.2(b) of Form 33-109F6 that will, in conjunction with subsection 4A.1(2) of Multilateral Instrument 11-102 Passport System, provide that the selection of a principal regulator for firms that do not have a head office or are not already registered in Canada is the jurisdiction in which the firm expects to conduct most of its activities that require registration as at the end of its current financial year or conducted most of its activities that require registration as at the end of its most recently completed financial year. We have also included new guidance in section 3.1 of 33-109CP relating to this amendment.

Other amendments

We made other amendments to NI 33-109 and forms:

Permitted individual

We amended the definition of "permitted individual" to clarify that it includes trustees, executors and other legal representatives that have direct or indirect control of more than 10% of the voting securities of a firm.

Forms 33-109F4 and 33-109F7 in format other than NRD format

We broadened the instructions in the forms so that an applicant who has questions about the form can consult with a legal adviser with securities law experience, rather than one with only securities regulation experience.

3. Amendments to NI 52-107 and 52-107CP

We amended NI 52-107 and 52-107CP to clarify that all registrants are subject to NI 52-107. We have added guidance in 52-107CP to indicate that where a registrant is also an investment fund that is subject to National Instrument 81-106 Investment Fund Continuous Disclosure (NI 81-106), the requirements in both NI 52-107 and NI 81-106 apply to the entity.

We have also made a housekeeping amendment in paragraph 2.1(2)(a) to reflect the previous change to the title of NI 31-103.

You can review the proposal here.

(416) 860-2955; bkoscak@casselsbrock.com

The Ontario Securities Commission (OSC) published its final 2013-2014 - Statement of Priorities in the OSC Bulletin today.  On April 4, 2013, the OSC published a draft Statement of Priorities and requested feedback. The OSC provided a summary of the comments and stated, among other things, that a significant number of comments focused on exempt market issues including alternative capital raising exemptions and possible adoption of an offering memorandum (OM) exemption in Ontario to increase and expand the capital raising capabilities of exempt market dealers.

Concerns were expressed about non-compliance with current exempt market rules, a perception of weak oversight and questions about the OSC's ability to ensure adequate compliance with the rules should it broaden the available exemptions. It was suggested that regulators do not have adequate data regarding the exempt market in Canada from which to make informed decisions on new exemptions, including crowdfunding. 

The OSC further stated that support for exempt market changes was mixed with some calling for implementation of a harmonized OM exemption that is applicable in all CSA jurisdictions with others completely opposed or expressing caution against the introduction of any new exemptions absent adequate data regarding the exempt market in Canada. Almost all commenters were opposed to crowdfunding citing investor protection concerns. The OSC stated that this lack of congruity in support for any one exempt market policy option is evidence of the need for continued consultations and review of the options that are proposed.

Despite the above concerns, the OSC stated that it recognizes that cost-effective access to capital is critical to companies of all sizes to grow and develop. To address growing interest in alternative capital raising techniques, such as crowdfunding, one of the OSC’s Key Regulatory Priorities for 2013-2014 will be to further consider the regulatory issues posed by these new capital-raising strategies. Moreover, if appropriate, the OSC stated it will propose changes to its current offering rules to facilitate capital formation for small businesses while maintaining important investor protections provided under securities law. 

The OSC’s Action Plan and Success Measures for businesses and investors who may not have adequate access to capital or investment opportunities in the exempt market are discussed below.

Action Plan

1. Complete stakeholder consultations and assessment of feedback on exempt market consultation paper published in December 2012

2. Engage businesses and business associations on access to capital, through outreach such as OSC in the Community

3. Determine options to move forward on expanding ways to access capital for issuers in Ontario and publish progress update

Success Measures

1. The OSC will better understand the risks and opportunities associated with expanding access to capital in the exempt market

2. Analysis of feedback will be completed

3. Proposals will clearly reflect the balance between promoting access to capital and efficient capital formation with investor protection

You can review EMDA comment letter on the OSC's 2013-2014 Statement of Priorities HERE.

The Order says MaRS SVX is proposing to operate an online portal (the Portal) bringing together accredited investors and issuers that aim to solve social or environmental challenges in Ontario.  MaRS SVX  will be registered with the OSC as a restricted dealer; not an exempt market dealer.  MaRS SVX is required to comply with customary gatekeeper KYC requirements, such as establishing the identity of a client, confirming that a client is an accredited investor, and complying with anti-money laundering requirements.  No transactions will be executed, settled or cleared through the Portal; it is a matching service provider. 

MaRS SVX will not issue securities or have related or connected issuers which is meant to address any conflict of interest concerns.  The Order is subject to certain investment limits and terms and conditions as set out in the Order.  For example, accredited investors will be limited to investing a maximum of $25,000 in a single offering and a maximum of $50,000 in total in all offerings on the Portal in a calendar year unless the investor provides MaRS SVX  with a letter from a registered dealer confirming that such dealer has fulfilled its KYC/suitability requirements under NI 31-103 and that the offering is a suitable investment for the investor. The Order is time-limited and will expire on the earlier of (i) two years and (ii) 90 days after any material change in MaRS SVX’s business, operations or capital.  The Order may be amended by the OSC on written notice to MaRS SVX.  The Order is for Ontario only.  It is presently not available in other jurisdictions in Canada.

A link to the Orders is on the OSC’s website here.