Looking to go public or raise capital in 2025? Canadian regulators just made it easier. On April 17, 2025, the Canadian Securities Administrators (the "CSA") introduced three new blanket orders that streamline disclosure requirements and pave the way for faster, more cost-effective capital raising (the "Blanket Orders"). These exemptions are designed to help issuers – especially newly public companies – navigate capital markets with greater flexibility and fewer regulatory hurdles. In this article, we break down what these changes mean and how issuers and other capital market participants can take advantage of them.
I. The Prospectus and Disclosure Order: A more flexible path to public markets
To reduce regulatory burdens for companies preparing to go public, the CSA has introduced Coordinated Blanket Order 41-930 Exemptions from Certain Prospectus and Disclosure Requirements. This new rule offers targeted exemptions from select disclosure requirements, helping issuers lower compliance costs and accelerate the offering process. Key exemptions include:
- Third-year historical financial statements not required: Issuers are exempt from providing financial statements for their third most recently completed financial yearfor prospectus filings.
- Simplified marketing during the waiting period: Issuers may include pricing and other information in marketing materials and standard term sheets distributed during the waiting period without having to file an amended preliminary prospectus – provided the information is disclosed in a news release before the marketing materials are shared with investors.
- Reduced promoter certificate requirements: If a promoter who is an individual has already signed a certificate in a role other than a promoter, a separate promoter certificate is not required for a prospectus or an amended prospectus. In Alberta, Saskatchewan, Manitoba, Ontario, New Brunswick, and Nova Scotia, promoter certificates are not required if: (i) the issuer has been a reporting issuer in Canada for at least 24 months; (ii) the prospectus does not relate to the distribution of an asset-backed security; and (iii) the promoter is not a control person, director, or officer of the issuer at the time of filing.
II. The new reporting issuer order: More options for newly public companies
Newly public issuers (other than investment funds) now have more room to raise capital, without the cost and delay of filing another prospectus. Under Coordinated Blanket Order 45-930 Prospectus Exemptions for New Reporting Issuers, eligible issuers can issue additional securities – within 12 months of their initial public offering ("IPO") – up to the lesser of $100 million or 20% of their market value, on a prospectus-exempt basis. This unlocks a faster path to follow-on financing for companies looking to grow quickly post-listing.
This exemption is subject to certain conditions, including:
- Offered securities: The offered securities must be equity securities of the same class qualified under the IPO prospectus, and the offering price must not be lower than the IPO price.
- Disclosure requirements: The issuer must file a news release and an offering document that includes: (i) details of the offering; (ii) disclosure of material facts relating to the offered securities not already disclosed; (iii) a description of the issuer's business objectives, recent developments, and use of proceeds; and (iv) a two-day cooling off period to cancel the agreement, along with a right of rescission or damages in the case of misrepresentation arising from the offering document.
III. The OM Order: Facilitating more private investments
Coordinated Blanket Order 45-933 Exemption from the Investment Limit Under the Offering Memorandum Prospectus Exemption to Exclude Reinvestment Amounts is available in Alberta, New Brunswick, Nova Scotia, Ontario, Quebec, and Saskatchewan. This exemption allows eligible investors to increase the investment limit for investors relying on the offering memorandum prospectus exemption under National Instrument 45-106 Prospectus Exemptions ("NI 45-106").
Under NI 45-106, eligible investors relying on the offering memorandum exemption may exceed the $30,000 investment limit if they obtain advice confirming the investment is suitable for them, but the limit in the preceding 12 months is capped at $100,000. This order offers greater flexibility by allowing eligible investors to reinvest proceeds from prior investments in the same issuer without those amounts counting toward the investment limit – provided the investor receives advice from a portfolio manager, investment dealer, or exempt market dealer confirming that the re-investment of proceeds remains suitable for that investor.1
IV. Looking ahead: A step forward in regulatory modernization
The Blanket Orders reflect a shift by the CSA toward a more responsive and flexible regulatory regime to support Canadian capital markets. We can expect further updates from the CSA as it continues to adapt to evolving market conditions and the needs of both issuers and investors. Indeed, the CSA's recent announcement confirms that it is exploring additional blanket orders, including a potential increase to the capital raising limit under the listed issuer financing exemption in NI 45-106 for all listed reporting issuers.
Footnote
1. In Ontario and Nova Scotia, issuers relying on the OM Order must provide written notice to the applicable securities regulator within ten days of the distribution and indicate this in Schedule 1 to Form 45-106F1 Report of Exempt Distribution.
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.
