News Release

Vancouver - The Canadian Securities Administrators (CSA), except for the Ontario Securities Commission, published today their proposal for implementing the second phase of the securities regulation passport for Canada.

Proposed National Instrument 11-102 Passport System is a major step toward meeting the commitments set out in the memorandum of understanding regarding securities regulation among the governments of all provinces and territories, except Ontario.

The passport will allow someone to clear a prospectus, register as a dealer or adviser, or obtain a discretionary exemption from the home province regulator and have that clearance, registration or exemption apply in all other provinces and territories. It also ensures that public companies are subject to only one set of harmonized continuous disclosure requirements.

"The passport will give market participants faster and simpler access to Canada's capital markets by allowing them to deal only with one regulator and one set of harmonized requirements," said Jean St-Gelais, Chair of the CSA and President & Chief Executive Officer of the Autorité des marchés financiers. "We look forward to discussing the proposed rule with industry and then moving ahead to implement it as soon as we can."

The foundation for the passport is a set of harmonized regulatory requirements consistently interpreted and applied throughout Canada. The proposed rule would be finalized by the end of 2007 and implemented in stages starting in early 2008 as the proposed new national rules on prospectus requirements (NI 41-101) and registration requirements (NI 31-103) are finalized.

"The passport we propose is a Pan-Canadian system that will simplify regulation and benefit businesses and investors in all provinces and territories," said Mr. St-Gelais. "Although the Ontario Securities Commission is not participating in the proposal, we have designed it so Ontario can join if it makes the necessary legislative changes."

The proposed rule and related documents are available on various CSA members' websites. The comment period is open until May 28, 2007.

The CSA, the council of the securities regulators of Canada's provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.

Passport system
Backgrounder

Prospectuses
A market participant filing a prospectus across Canada will

• need to comply only with harmonized prospectus requirements
• have its prospectus reviewed by only one regulator
• need a receipt for the prospectus from only one regulator

Registration
A firm or individual already registered as a dealer or adviser across Canada

• is automatically transferred to passport unless the dealer or adviser opts out
• continues to deal with the IDA, where applicable

A firm or individual seeking registration as a dealer or adviser across Canada will

• file an application only in one jurisdiction
• have its application reviewed by only one regulator
• need a decision from only one regulator

All firms and individuals under passport will need to comply with

• harmonized registration requirements
• a few local requirements that CSA will attempt to harmonize
• only with the terms and conditions imposed by their principal regulator

Discretionary exemptions
A market participant that needs a discretionary exemption in multiple jurisdictions will

• file an application only in one jurisdiction
• have its application reviewed by only one regulator
• need a decision from only one regulator

Continuous disclosure
An issuer that is a reporting issuer across Canada will

• need to comply only with harmonized continuous disclosure requirements
• have any continuous disclosure exemption granted to it under the principal regulator system (MI 11-101) grandfathered

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