The first quarter of 2015 saw a number of regulatory
developments in Canadian capital markets that may specifically
affect companies in the oil and gas industry. Below, we've
compiled a list of key legal developments since January 1, 2015
that may be of particular interest, along with corresponding links
to our securities blog.
Canadian regulators publish draft rules to amend the take-over bid
rules to require a 120-day minimum bid period (subject to the right
of the target to waive to 35 days) a minimum 50% tender condition
and a mandatory 10 day extension after the satisfaction of all
other conditions. This is a proposal - no changes in the rule are
expected for another year.
OSC reviews recent related party transaction
disclosure, encouraging issuers to provide more information about
insider participation in private placements and board process
related to transaction approval
TSX completes the first listing of a special
purpose acquisition company (a TSX form of CPC).
Canadian regulators allow a cheaper alternative to the rights
offering - permitting existing shareholders to purchase up to
$15,000 of listed securities or warrants of a TSX or TSXV company
without a prospectus or rights circular, subject to a 100% dilution
TSXV amends private placements rules to eliminate
premium warrant pricing in certain transactions and to codify
procedures for the amendment of convertible securities to reflect
current working practices.
Canadian regulators expand the accredited investor category to
require additional steps to verify AI status, require AI's to
sign a risk acknowledgment and remove the $150,000 exemption (for
persons other than holding companies). This rule is effective May
TSX proposes new rules for inter-listed issuers to
increase TSX deference to larger-volume exchanges and to propose a
shareholder vote for voluntary delisting.
TSX makes housekeeping amendments to the NCIB and
dividend/distribution reporting forms.
Canadian regulators amend oil and gas disclosure rules in NI
51-101 to provide for alternative resource evaluation methods,
additional guidance on contingent and prospective resource data
reporting, enhanced abandonment and reclamation cost disclosure and
a new approach to reporting of certain production and other
metrics. The new rules are effective for the reserve report for the
year ending December 31, 2015 for issuers with a December 31 year
IIROC releases final guidance on underwriting
diligence, offering recommended practices on diligence planning,
the structure of Q&A sessions and business diligence.
Canadian regulators (other than Ontario) exempt certain US
broker-dealers and advisors from registration requirements if they
have offices or employees in Canada.
Activism & Litigation
In Hariharan, the OSC approves a settlement
proposed by staff that makes a resident of Ontario liable under
Ontario law for insider trading in an entity that was not a
reporting issuer in Canada.
In Beaudette, an
Alberta court finds that an Alberta resident could not rely on the
Charter to protect himself from disclosure requested by the ASC in
connection with an SEC investigation of that resident.
Ontario certifies the
securities class action claim against Sino-Forest.
The OSC proposes key elements of a whistleblower rule,
including providing for the payment of incentives of up to $1.5M to
those who provide high-quality information.
Canadian regulators provide an update on their review of the
proxy voting system, recommending actions to modernize the vote
tabulation process and other steps.
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Canada is a constitutional monarchy, a parliamentary democracy and a federation comprised of ten provinces and three territories. Canada's judiciary is independent of the legislative and executive branches of Government.
The Government of Alberta recently announced a number of policy changes that will impact the Alberta Electricity Market, composed of its generators, transmitters, distributors, retailers, electricity consumers and wholesale electricity market.
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