The Ontario Securities Commission yesterday published a progress report on its review of potential new prospectus exemptions. The report provides an update on work completed to date, as well as a roadmap for future work. As we've discussed in the past, the OSC initiated a consultation process on crowdfunding late last year with the release of a consultation paper, and subsequently held a roundable discussion in June to obtain input from investors on the subject.
According to the report, OSC Staff have been directed to undertake work on four new capital raising prospectus exemptions, namely: (i) a crowdfunding exemption (the report states that $2,500 single investment and $10,000 12-month period limits per investor would be appropriate); (ii) a family, friends and business associates exemption, with the goal of substantial harmonization of the exemption across Canada; (iii) an offering memorandum exemption that is harmonized with the existing Alberta model in NI 45-106; and (iv) a streamlined rights offering exemption and a possible exemption based on a reporting issuer's continuous disclosure and existing securityholder base.
Ultimately, the OSC focus is addressing the capital raising needs of small and medium-sized enterprises while maintaining adequate levels of investor protection. For more information, see OSC Notice 45-712.