Alberta Securities Commission

The Alberta Securities Commission (ASC) has proposed replacing the current ASC Rule 72-501 with a new ASC Rule 72-501 (Proposed Rule).  The Proposed Rule is intended to reduce regulatory impediments and facilitate offerings by Alberta issuers to investors outside of Alberta by removing the potentially duplicative application of Alberta prospectus requirements where an offering materially complies with the securities laws of the foreign jurisdiction.  The ASC has historically taken the position that a distribution by an issuer with a fundamental or, in certain cases, significant connection to Alberta is a distribution from Alberta and subject to Alberta securities laws.  The approach in the Proposed Rule follows new rules recently released by the Ontario Securities Commission under OSC Rule 72-503 Distributions Outside Canada (OSC Rule 72-503) regarding distributions of securities outside of Canada.  The Proposed Rule should primarily benefit issuers with a fundamental connection to Alberta that are distributing securities to persons located outside Canada.


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The Canadian Securities Administrators (CSA) have adopted amendments to National Instrument 45-102 Resale of Securities (NI 45-102) and changes to Companion Policy 45-102CP which provide for a new prospectus exemption for the resale by Canadian investors of securities of non-Canadian issuers. The amendments are expected to come into force as of June 12, 2018. The amendments will be applied to all Canadian jurisdictions other than Alberta and Ontario.

In Alberta and Ontario, the new exemption will be found in the following local instruments:


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On September 21, 2017, following the results of a stakeholder survey conducted over the course of the year to date, the British Columbia Securities Commission (BCSC) announced changes to the existing equity crowdfunding rules found in British Columbia Instrument 45-535 – Start-up Crowdfunding Registration and Prospectus Exemptions (BCI 45-535) to address two of the most

calgary-1751846_1920The Supreme Court of Canada (SCC) recently dismissed two separate appeals whereby the defendants, Ronald Aitkens and Jeremy Peers, argued for a right to trial by jury for securities law offences.

Aitkens and Peers were charged with offences under the Securities Act (Alberta). Section 194 of the Securities Act (Alberta) provides for a maximum penalty

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In December, the Alberta Securities Commission (ASC) published its annual Corporate Finance Disclosure Report (Report). The ASC then hosted an information seminar (Seminar) on the Report’s findings and recommendations in Calgary, Alberta on January 11, 2017. Fasken Martineau was pleased to attend the Seminar with a view to advising our reporting issuer clients as to best disclosure practices.

The ASC chose to focus on commodity price impacts on continuous disclosure by reporting issuers, as opposed to the more typical practice of a broader-scope report. As such, the Report gave topical and important reviews, in that context, on the use of non-GAAP measures (NGMs) and forward-looking information, as well as impairment of assets under accounting standards. Most prominent among the continuous disclosure issues in the Report, however, was liquidity and capital resources information in management discussion and analysis disclosure.

We expect the ASC will be paying particular attention to fulsome and timely disclosure of liquidity and capital resources information in 2017, particularly in respect of plans to remedy working capital deficiencies, conditional borrowing limits, risk of breach of financial covenants, and impacts on production capacity maintenance following capital expenditure reductions and asset dispositions.


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On December 1, 2016, the Alberta Securities Commission (ASC) will be replacing the current fee rule in Alberta with ASC Rule 13-501 Fees (ASC Rule 13-501) which will increase registrant and capital market activity fees, and for the first time in Alberta, will introduce a participation fee model.

Any issuers that are currently a reporting issuer in Ontario are already familiar with the concept of a participation fee.  The participation fee is an annual payment based on the capitalization of the issuer (the larger the issuer’s capitalization is, the larger the fee is).  The ASC participation fee will be payable at the time that the issuer files its annual financial statements on SEDAR.  Under the ASC’s current fee rule, the maximum an issuer would pay when it file its annual financial statements is $2,400 (which is the amount paid by short form eligible issuers).

As a result of the introduction of the new participation fee model, any reporting issuer with a capitalization of over $50 million will see an increase in the payment that it submits to Alberta with its annual financial statements.  In some cases, issuers will see a significant increase as the maximum amount payable under the participation fee model is $48,000.

Types of Reporting Issuers

The ASC participation fee rates are based on the type of reporting issuer it is – either a Class 1 reporting issuer, a Class 2 reporting issuer, a Class 3A reporting issuer or a Class 3B reporting issuer.  Each type of reporting issuer is defined below:


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Fasken Martineau Investment Product Legal ExpertiseThe Canadian Securities Administrators (CSA) published for comment Consultation Paper 33-403 CSA Consultation Paper 33-403 The Standard of Conduct for Advisers and Dealers: Exploring the Appropriateness of Introducing a Statutory Best Interest Duty When Advice is Provided to Retail Clients   which discusses the potential benefits and feasibility of imposing a statutory fiduciary duty on advisers