By an instrument effective March 23, 2015, the British Columbia
Securities Commission (BCSC) removed barriers to participation by
institutional investors in private placements by foreign issuers by
addressing two requirements that are unique to Canada.
The BCSC instrument grants an exemption from:
Multilateral Instrument 51-105 Issuers Quoted in the U.S.
Over-the-Counter Markets (MI 51-105), which may cause certain
issuers having a class of securities quoted on a U.S.
over-the-counter market to become subject to Canadian ongoing
An exemption from the requirement to provide underwriter
conflicts disclosure under National Instrument 33-105
Underwriting Conflicts (NI 33-105), both on the front page
and in the body of an offering document.
The only conditions are that (1) the securities be distributed
under an exemption from the prospectus filing requirement and (2)
the distribution (and promotional activities in the case of MI
51-105) in British Columbia be restricted to "permitted
clients," a narrower category than "accredited
investor." The relief applies to both foreign issuers and
Canadian issuers, reporting issuers and non-reporting issuers, and
offerings that are made primarily in Canada as well as offerings
made primarily outside Canada. The exemptive relief is available to
all dealers entitled to distribute securities to permitted clients
in British Columbia without a requirement to provide those
permitted clients with a notice or to receive back from them an
acknowledgment. In contrast to the ASC's blanket order, which
is scheduled to expire on November 20, 2017, the BCSC instrument
applies on a permanent basis.
The instrument does not deal with listing representations, which
the BCSC previously addressed in Blanket Permission Under Section 50(1)(c) of
the Securities Act. It also does not deal with statutory
rights of action because, unlike Ontario and certain other
provinces, B.C. securities legislation does not have statutory
rights of rescission or damages for misrepresentation in an
The BCSC issued the instrument on the basis that MI 51-105 and
NI 33-105 impose unnecessary and unintended constraints on private
placements to B.C. institutional investors. As a result of MI
51-105, many offerings have been made available to institutional
investors in Ontario, Quebec and, most recently, Alberta, but not
elsewhere in Canada.
The MI 51-105 exemption in both the ASC blanket order and the
BCSC instrument corresponds to an exemption previously granted by
Quebec's Autorité des marchés financiers (AMF).
The BCSC instrument mirrors the language contained in the ASC
blanket order in expanding the MI 51-105 permitted client exemptive
relief granted by the AMF to also apply to the underwriter
conflicts disclosure requirements of NI 33-105.
The MI 51-105 exemption is available for both promotional
activities carried on in or from British Columbia and the
distribution of a security to a B.C. permitted client. It replaces
the exemptive relief previously granted by the BCSC in Blanket
Order 51-511 Re Relief from Multilateral Instrument 51-105
Issuers Quoted in the U.S. Over-the-Counter Markets, while
retaining the earlier blanket order's exemptive relief for both
issuers that have securities listed on an exchange designated in
the order and issuers whose only listed or quoted securities are
non-convertible debt securities.
The B.C. instrument eliminates any impediment to a typical
offering of foreign securities being extended to institutional
investors in British Columbia, just as the Alberta blanket order
did for institutional investors in Alberta. With two provincial
regulators having taken the step of granting broad relief from NI
33-105, the question remains whether the other provincial
securities regulators—particularly the Ontario Securities
Commission, the AMF and The Manitoba Securities
Commission—will follow suit.
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 Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Please join members of the Blakes Commercial Real Estate group as they discuss five key provisions of a commercial real estate purchase agreement that are often the subject of much negotiation but are sometimes misunderstood.
Emotional culture is influenced in great part by the mindset and actions of leadership, although employees also play more of a role than they may realize in creating the culture that exists in the group.
The session will be led by Dr. Robert Brooks, an award-winning author and psychologist. In his presentation, Dr. Brooks will describe the mindset and realistic practices of leaders and staff that help to nurture and sustain a culture characterized by positive emotions, satisfying, respectful relationships, a sense of meaning and ownership for one’s work, and enhanced job performance. Examples will be offered to illustrate strategies for developing a positive emotional culture in an organization.
Join leading lawyers from the Blakes Pensions, Benefits & Executive Compensation group as they discuss recent updates and legal developments in pension and employee benefits law as well as strategies to identify and minimize common risks.
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.
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).