A new harmonized Form 45-106F1 Report of Exempt Distribution (the New Report) will come into effect on June 30, 2016 in all Canadian provinces and territories. Announced by the Canadian Securities Administrators (the CSA) on April 7, 2016 in CSA Notice of Amendments to National Instrument 45-106 Prospectus Exemptions relating to Reports of Exempt Distribution, the New Report is intended to reduce the compliance burden for issuers and underwriters, and to provide securities regulators with information necessary to facilitate more effective regulatory oversight of the exempt market.
Heightened disclosure requirements
The New Report will have heightened disclosure requirements. All issuers will be required to disclose, among other things:
- the type of securities being distributed using a new 3-letter code; and
- specific details about the prospectus exemption relied upon, including how each purchaser qualifies for certain exemptions, including the “accredited investor” exemption, for example.