Further to our bulletin of January 17, 2012, describing proposed amendments to the prospectus rules, the Canadian Securities Administrators have approved amendments to National Instrument 41-101 General Prospectus Requirements and other rules and related policies.  Among other things, the amendments:

• provide guidance from the CSA (through changes to the Companion Policies) of their views on bought deal engagement letters, regulatory outs and due diligence outs;
• provide for a “testing the waters” exemption that will allow non-reporting issuers to determine interest in a potential IPO by communicating confidentially with accredited investors through an investment dealer ;
• specify when bought deals can be enlarged as well as the degree (up to 100% of the size of the original deal); and
• distinguish between “standard term sheets” (containing limited information about an issuer) and “marketing materials” (containing more detailed information about an issuer), with a requirement to file “marketing materials” on SEDAR, subject to a limited exemption for cross border offerings.

The amendments are expected to take effect on August 13, 2013.

Look out for our new bulletin, to be published shortly, in which we will review the amendments in more detail.