Registration Reform Round Two: Key features for investment fund managers, foreign funds and private equity funds

Alix d'Anglejan-Chatillon, Jennifer Northcote and Kenneth G. Ottenbreit | Version française

On February 29, 2008, the Canadian Securities Administrators (CSA) published their revised proposals relating to national registration requirements for dealers, advisers and investment fund managers.  Over 260 comment letters were received on the original proposals (published in February of 2007). These proposals constitute an overhaul of registration requirements and registration exempt activities, and are intended to present a streamlined and harmonized approach to the regulation of investment activities across Canada. The revised proposals are open for comments until May 29, 2008.

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CSA releases tentative views on IFRS transition issues under Canadian rules

Simon Romano and Ramandeep Grewal | Version française

The Canadian Securities Administrators (CSA) published Concept Paper 52-402 (Concept Paper) on February 15, 2008 to discuss ramifications for securities rules as a result of the impending transition from Canadian GAAP to International Financial Reporting Standards (IFRS, as issued by the International Accounting Standards Board (IASB)). As the Canadian Accounting Standards Board (AcSB) has adopted a transition plan to move to IFRS for years beginning on or after January 1, 2011, the CSA must now consider implications of this move on securities laws and regulations. Continue Reading...

Round Two of Canada's National Registration Reform Proposal: An international perspective

Ken Ottenbreit, Ralph Hipsher and Terence Doherty | Version française

On February 29, 2008, the Canadian Securities Administrators (CSA) published their revised proposals on National Instrument 31-103 Registration Requirements (the "Instrument"), relating to registration requirements for dealers, advisers and investment fund managers. These revised proposals constitute an overhaul of registration requirements and registration exempt activities, and are intended to present a streamlined and harmonized approach to the regulation of investment activities across Canada. The proposed registration reforms represent a major restructuring of the Canadian dealer, adviser and investment fund manager registration rules and have implications for non-Canadian dealers, advisers and investment fund managers doing business on a registered or exempt basis in any province or territory of Canada, including non-Canadian dealers and advisers registered in Ontario.

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Proposed Canadian registration regime for dealers, advisers, fund managers: Registration Reform round two

Alix d'Anglejan-Chatillon, Jennifer Northcote and Ramandeep Grewal | Version française

On February 29, 2008, the Canadian Securities Administrators (CSA) published their revised proposals on National Instrument 31-103 relating to registration requirements for dealers, advisers and investment fund managers.  Over 260 comment letters were received on the original proposals (published in February of 2007). These proposals constitute an overhaul of registration requirements and registration exempt activities, and are intended to present a streamlined and harmonized approach to the regulation of investment activities across Canada. The revised proposals are open for comments until May 29, 2008.  These proposals are expansive and will have a significant impact on registration issues generally, as well as on a broad range of capital markets activities, including private placements, trading and advising activities and private and public fund offerings.

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Sovereign Wealth Fund investment: What's next for Canada?

Curtis Cusinato, Jeffrey Singer and Sandra Walker  | Version française

As financial institutions and private equity firms focus on recovery from the subprime mortgage crisis, government investment vehicles known as Sovereign Wealth Funds (SWFs) are emerging as key players in global M&A. Quite apart from the spotlight cast on them by their recent (and heroic) intervention in the financial markets, including investments in Citigroup, Bear Stearns, Morgan Stanley and Merrill Lynch, SWFs are attracting widespread international attention because of their dramatic growth. No longer the almost exclusive preserve of the traditional oil exporters,1 they are being established in significant numbers in Asian export economies as well as in Russia and other emerging natural resources powers. According to one recent estimate, the holdings of SWFs worldwide may top US$12 trillion by 2015.2 Another important development is a shift in investment strategy away from lower-yielding bond investments towards equity investments and (most significantly) key strategic assets.

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Relief for venture issuers and further update on CFO and CEO certifications

Simon Romano and Ramandeep Grewal | Version française

Venture issuers get some early relief as Canadian Securities Administrators (CSA) work towards a final proposal to incorporate certifications as to effectiveness of internal controls.

Multilateral Instrument 52-109 Certification of Disclosure of Issuer's Annual and Interim Filings (Certification Rule) finds itself again subject to a further amendment proposal. As of the first year-end following June 30, 2006, most issuers have been required to file full interim and annual certificates. These certificates have required the CFO and CEO to provide certifications with respect to:

  • annual filings (which means the AIF, annual financial statements and annual MD&A, and anything incorporated by reference into the AIF);
  • the establishment, maintenance and design of disclosure controls and procedures (DCP) and internal control over financial reporting (ICFR);
  • evaluation of effectiveness of DCP; and
  • disclosure of conclusions regarding effectiveness of DCP and any changes in ICFR in the MD&A.
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New material contract filing requirements in force March 17, 2008 and impact on existing material contracts

Martin Langlois and Ramandeep Grewal | Version française

National Instrument 51-102 Continuous Disclosure Obligations (the Disclosure Instrument) is scheduled to be amended on March 17, 2008 as a consequence of the coming into force of the proposed national prospectus rule, National Instrument 41-101 General Prospectus Requirements. Amendments to the Disclosure Instrument include significant amendments to the requirements to file material contracts on SEDAR, as well as to the related Companion Policy guidance of the Canadian Securities Administrators (the CSA).

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Another record year for M&A

William J. Braithwaite and John Ciardullo

This past year was a record year for Canadian mergers and acquisitions with transaction volumes soaring to all time highs. However, the second half of 2007 was marred by the North American credit crunch and transaction volumes suffered as a result. According to data compiled by Financial Post Crosbie: Mergers and Acquisitions in Canada, there was $370 billion worth of deals in 2007, up a staggering 44% over the record $257 billion of deals in 2006. But there were fewer transactions in the second half of the year and leveraged buyouts over $100 million involving financial buyers fell dramatically from 78 ($85 billion) in the first half of 2007 to 13 ($10.7 billion) in the second.

Most M&A practitioners expect reduced volumes and fewer leveraged buyouts in 2008 as the market continues to digest the large backlog of debt in the pipeline. Members of the M&A bar are hopeful that activity will remain respectable by historical standards as a result of transactions involving strategic buyers (including non-Canadian buyers), sovereign wealth funds and the continued presence of financial buyers in transactions where leverage is less of a factor, and due to continuing economic drivers such as strong balance sheets, the trend towards globalization and the competitive landscape in North America.

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