On February 25, 2011, the Canadian Securities Administrators
published CSA Staff Notice 31-323 Guidance Relating to the
Registration Obligations of Mortgage Investment Entities [available here], which provides long awaited
guidance on how the registration requirements under National
Instrument 31-103 Registration Requirements and Exemptions
apply to mortgage investment corporations (MICs), mortgage
syndications and other mortgage investment entities. Although the
Staff Notice provides some additional clarity on the application of
these rules, a number of questions remain unanswered. In addition,
the Staff Notice highlights that the members of the CSA have not
come to a uniform position about these vehicles, with different
positions being taken by the securities regulators in Alberta and
The application of securities law registration requirements to
mortgage investment entities has been surrounded by a great deal of
uncertainty since NI 31-103 was introduced in September 2009. Prior
to that time, most mortgage investment entities had been subject to
minimal regulation under securities laws. However, that changed
significantly when securities regulators raised the prospect that
certain mortgage investment entities may be required to obtain
registration under NI 31-103 in up to three different categories of
registration – investment fund manager, adviser and
exempt market dealer.
Mortgage investment entities, and firms that provide services to
such entities, that have been operating under existing investment
fund manager and adviser registration exemptions granted by each
CSA member in relation to MICs and other mortgage investment
entities (for example, in Ontario, see OSC Decision [available here] and in BC, see BC Instrument
32-521 [available here] (the 2010 exemptions) will be
required to apply for registration in one or both of these
categories as early as March 31, 2011 and incur the additional
costs associated with these registrations, unless they determine
based on the guidance provided in the Staff Notice or otherwise
that such registrations are not required.
Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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