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Quarterly reporting has historically been a bedrock of public issuer disclosure in Canada and the United States. It may not be going forward.
The Canadian Securities Administrators (CSA) has proposed a pilot to allow eligible venture issuers to voluntarily adopt semi-annual financial reporting (the SAR Pilot). Specifically, the SAR Pilot would enable issuers listed on the TSX Venture Exchange or Canadian Securities Exchange with annual revenue of no more than $10 million to opt out of third quarter financial reports under NI 51-102.1
The SAR Pilot is the product of several years of work and consultations by the CSA. Nonetheless, the timing is notable. In mid-September, U.S. President Trump stated that U.S. public companies should be permitted to report semi-annually. For its part, the U.S. Securities and Exchange Commission has advised that it aims to "rationalize" public issuer disclosure obligations.
While the pros and cons of semi-annual vs. quarterly reporting can be debated, there's little doubt that a shift toward semi-annual reporting, even if limited to smaller issuers, would be a major move for Canada's capital markets. It could also prove a critical point of competitive advantage or disadvantage for Canada's capital markets relative to U.S. capital markets. The CSA's proposal is therefore significant, and we will share our additional thoughts in due course.
In the meantime, our key takeaways for Canadian issuers and capital market stakeholders are:
- The CSA has published for comment a proposed Coordinated Blanket Order 51-933 Exemptions to Permit Semi-Annual Reporting for Certain Venture Issuers.2
- The public comment period ends on December 22, 2025.
- We encourage Canadian issuers and capital market stakeholders to consider providing comments, either directly or through Fasken.
A summary of the SAR Pilot and the CSA's related commentary can be found in the CSA Notice and Request for Comment. The CSA also intends to "engage in a broader rule-making project related to voluntary semi-annual reporting."
Footnotes
1. National Instrument 51-102 – Continuous Disclosure Obligations.
2. The CSA also states that it intends to engage in a broader rule-making project related to voluntary semi-annual reporting.
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