Canada: Exemptive Relief Granted To Facilitate Foreign Offerings Being Extended Into Canada

On April 23, 2013, Canadian securities regulators provided exemptive relief from certain disclosure requirements to a group of dealers in connection with private placements of foreign securities to Canadian purchasers (the Exemptive Relief). Shortly after granting the Exemptive Relief, the Ontario Securities Commission (OSC) published for comment proposed amendments to OSC Rule 45-501 Ontario Prospectus and Registration Exemptions and NI 45-106 Prospectus and Registration Exemptions (collectively the Proposed Amendments).

The Exemptive Relief and the Proposed Amendments, if enacted, will reduce the disclosure currently contained in Canadian "wrappers" that accompany foreign offering documentation and will facilitate the offering of foreign securities to sophisticated investors in Canada.


When a foreign offering of securities is extended on a private placement basis to Canadian purchasers, it is necessary for the foreign offering documentation to be supplemented by additional Canadian disclosure. This additional disclosure is generally contained in a supplemental document known as a "wrapper." The additional information includes:

  • disclosure as to whether the issuer is a related or connected issuer of the underwriter as prescribed in National Instrument 33-105 Underwriting Conflicts (connected and related issuer disclosure).
  • disclosure of the statutory right of action for damages or rescission an investor may have if the offering memorandum contains a misrepresentation (statutory rights disclosure). Only Ontario, Saskatchewan, New Brunswick and Nova Scotia require this disclosure.
  • notification to and authorization from the investor regarding collection of personal information.

Issuers are also currently prohibited from making any representations in the offering documentation as to the listing of securities on a stock exchange. Complying with these additional requirements can be costly and time-consuming and may discourage issuers and dealers from extending a foreign offering into Canada, thereby depriving Canadian investors of important investment opportunities.

Exemptive relief granted

The application for relief was made by a group of dealers actively involved in foreign offerings and who would regularly consider whether to extend such offerings to sophisticated investors in Canada. The effect of the Exemptive Relief is that connected and related issuer disclosure and statutory rights disclosure need not be provided in an offering document provided certain conditions are met, including:

  • the securities must be offered primarily in a foreign jurisdiction;
  • the securities must be issued by a foreign issuer or issued or guaranteed by a foreign government. A foreign issuer is an issuer that is incorporated or created under the laws of a foreign jurisdiction, is not a reporting issuer, has its head office outside Canada and is not an investment fund as defined in securities legislation;
  • the securities must be offered under a prospectus exemption to investors in Canada who qualify as permitted clients. Permitted clients are defined in National Instrument 31- 103 Registration Requirements, Exemptions and Ongoing Registrant Obligations and are more narrowly defined than accredited investors;
  • a prescribed form of notice and acknowledgement stating that the Exemptive Relief is being relied upon and setting out the potential statutory rights and underwriting conflicts must be delivered to and signed by the permitted client. This notice must be given before the Exemptive Relief can be relied upon but is not required to be delivered in respect of each offering; and
  • the offering documentation must contain the disclosure of underwriter conflicts required under US law for a US-registered offering, regardless of whether or not it is a US-registered offering or, in the case of securities issued or guaranteed by a foreign government, either the underwriter conflicts disclosure required for a US-registered offering or the prescribed underwriter conflicts disclosure required by the Canadian rules must be included.

The applicants also received separate permission to include listing representations in offering documentation. Finally, the applicants were further provided with comfort from the OSC that a personal information authorization was only required where the purchasers are individuals.

Timing of relief

The Exemptive Relief granted will not take effect until 60 days after April 23, 2013, to allow other parties who wish to seek similar relief to do so. The Exemptive Relief will expire on the earlier of (i) the date Canadian securities legislation is amended to provide substantially the same relief; or (ii) the date that is three years after the decision takes effect.

Ontario Securities Commission proposal

On April 25, 2013, the OSC issued the Proposed Amendments for public comment. The Proposed Amendments are only an initiative of the OSC and are narrower than the Exemptive Relief in that they do not exempt the requirement to make connected and related issuer disclosure. The OSC notice states that the OSC and the other Canadian securities administrators are considering amendments to National Instrument 33-105 Underwriting Conflicts to provide relief from connected and related issuer disclosure when offerings are made by foreign issuers.

The Proposed Amendments, if enacted, would exempt certain disclosure currently required to be included in a Canadian wrapper in connection with an offering of foreign securities in Ontario to permitted clients by:

  • allowing registered dealers or international dealers to give purchasers notice of their statutory rights by delivery of a one-time notice and acknowledgement. This will avoid the necessity of including the statutory rights disclosure every time a private placement is made in Ontario;
  • providing relief from the listing representation prohibition; and
  • providing clarification that the collection of personal information authorizations is only required if the permitted clients are individuals.

A copy of the Exemptive Relief can be accessed here. The Proposed Amendments are open for public comment until July 24, 2013, and can be accessed here.

Norton Rose Group

Norton Rose Group is a leading international legal practice. We offer a full business law service to many of the world's pre-eminent financial institutions and corporations from offices in Europe, Asia, Australia, Canada, Africa, the Middle East, Latin America and Central Asia.

Knowing how our clients' businesses work and understanding what drives their industries is fundamental to us. Our lawyers share industry knowledge and sector expertise across borders, enabling us to support our clients anywhere in the world. We are strong in financial institutions; energy; infrastructure, mining and commodities; transport; technology and innovation; and pharmaceuticals and life sciences.

We have more than 2900 lawyers operating from 43 offices in Abu Dhabi, Almaty, Amsterdam, Athens, Bahrain, Bangkok, Beijing, Bogotá, Brisbane, Brussels, Calgary, Canberra, Cape Town, Caracas, Casablanca, Dubai, Durban, Frankfurt, Hamburg, Hong Kong, Johannesburg, London, Melbourne, Milan, Montréal, Moscow, Munich, Ottawa, Paris, Perth, Piraeus, Prague, Québec, Rome, Shanghai, Singapore, Sydney, Tokyo, Toronto and Warsaw; and from associate offices in Dar es Salaam, Ho Chi Minh City and Jakarta.

Norton Rose Group comprises Norton Rose LLP, Norton Rose Australia, Norton Rose Canada LLP, Norton Rose South Africa (incorporated as Deneys Reitz Inc), and their respective affiliates.

On January 1, 2012, Macleod Dixon joined Norton Rose Group adding strength and depth in Canada, Latin America and around the world. For more information please visit

Norton Rose will join forces with Fulbright & Jaworski L.L.P on June 1, 2013, creating Norton Rose Fulbright a global legal practice with significant depth of expertise across the USA, Europe, Asia, Australia, Canada, Africa, the Middle East, Latin America and Central Asia.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.