Investors who beneficially own more than 5% of a class of voting
equity securities of an SEC-registered issuer may need to file a
report with the SEC by February 17, 2009. This annual reporting
deadline applies in certain circumstances to regulated
institutional investors, passive investors and other categories of
investors described below. The rules apply to investments in any
SEC-reporting issuer, including foreign private issuers and
General Rule: File a Beneficial Ownership Report Within 10 Days
Investors must generally file a beneficial ownership report
within 10 days of an acquisition of voting equity securities that
crosses the 5% threshold. Subject to the exceptions described
below, the initial report must be filed on Schedule 13D, which
requires extensive disclosure, including a detailed description of
the facts and circumstances surrounding the acquisition, the source
of funds and the investor's plans regarding control of the
Investors who would otherwise be required to file Schedule 13D
may instead file a short-form Schedule 13G provided they own less
than 20% of the class of voting equity securities and have not
acquired them with the purpose or effect of changing or influencing
the control of the issuer. Following the initial filing, a passive
investor who acquires beneficial ownership of more than 10% of the
class of voting equity securities must promptly file an amendment
to the Schedule 13G and must thereafter amend promptly if the
ownership changes by more than 5% of the class. If there are any
other changes in previously reported information, an amendment is
required within 45 days of year-end – that is, by
February 17, 2009.
Regulated Institutional Investors
Certain regulated institutional investors, including
broker-dealers, banks and insurance companies, that acquire more
than 5% of a class of voting equity securities in the ordinary
course of business, and not with the purpose or effect of changing
or influencing the control of the issuer, are exempt from filing
Schedule 13D.2 These U.S. and non-U.S. institutional
investors may instead file Schedule 13G, with the following
If the investor's beneficial ownership is greater than 5%
but not more than 10%, Schedule 13G is due within 45 days of
If the investor's beneficial ownership exceeds 10%
(computed as of the last day of the month), Schedule 13G is due
within 10 days of the end of the first month in which that
Once an institutional investor has a Schedule 13G on file with
the SEC, it must file an amendment within 10 days of the end of the
first month in which its ownership of the class of voting equity
securities exceeds 10% (computed as above). Thereafter, it must
file an amendment if its ownership changes by more than 5% of the
class (computed as above). If there are any other changes in
previously reported information, an amendment to the Schedule 13G
is required within 45 days of year-end.
Multiple Small Acquisitions
Investors whose ownership crosses the 5% threshold by virtue of
multiple small acquisitions aggregating less than 2% in any
12-month period must file Schedule 13G, and amendments to reflect
any changes, within 45 days of year-end.
Other Schedule 13D Exemptions
Any investor outside the above categories that was exempt from
the initial reporting requirement but that was a 5% beneficial
owner on December 31, 2008 must file Schedule 13G by February 17,
2009. Typically, this would occur when the investor already owned
more than 5% at the time the issuer became an SEC registrant.
1.Multijurisdictional Disclosure System
2.This accommodation used to apply only to U.S.
institutions, but the SEC recently amended its rules to extend the
accommodation to non-U.S. institutions that are functionally
equivalent to their U.S. counterparts and subject to a
substantially comparable regulatory regime. The rule changes are
discussed in Torys' October 3, 2008 bulletin atwww.torys.com/Publications/Documents/Publication%20PDFs/MA%202008-9.pdf
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guide to the subject matter. Specialist advice should be sought
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The Canadian Office of the Superintendent of Financial Institutions ("OSFI") recently ruled that a bank cannot promote comprehensive credit insurance ("CCI") within its Canadian branches under the Insurance Business (Banks and Bank Holdings Companies) Regulations (the "Regulations").
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