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Securities Law

BOR 97/11 - Eurobond Offerings [Rescinded]

Published Date: 1997-11-28
Effective Date: 1997-12-01
Rescinded Date: 2001-06-29




Order Under Sections 48 and 76

WHEREAS sections 34 and 61 of the Securities Act, R.S.B.C. 1996, c. 418, require an issuer that is doing a distribution from British Columbia to use a dealer registered to trade and underwrite in British Columbia and file a prospectus with the Commission;

AND WHEREAS distributions of non-convertible debt by issuers into the Eurobond market are unlikely to flow-back into the British Columbia capital markets;

AND WHEREAS the Commission considers that it would not be prejudicial to the public interest to provide an exemption for offerings of non-convertible debt in a genuine market outside Canada and to reduce the hold periods imposed by sections 142 and 143 of the Securities Rules for offerings of those securities;

AND WHEREAS for the purpose of this order

"genuine market" means:

(a)        the Eurobond market, as regulated by the International Securities Market Association; and

(b)        any foreign securities exchange or non-exchange market designated by the Executive Director or the Commission;

EFFECTIVE December 1, 1997,


1.         under sections 48 and 76 of the Securities Act, that section 34(1)(a) and (b) and section 61 of the Securities Act do not apply to the distribution of a non-convertible debt security provided that:

(a)        the distribution is not made to a person in Canada;

(b)        the debt has been accepted for listing on a genuine market outside Canada;

(c)        the issuer files a report of the trade prepared and executed in accordance with the Form 20 of the Securities Rules on or before the 10th day after the distribution;

(d)        the offering circular contains a legend stating that the securities are not qualified for sale in British Columbia and may not be offered or sold directly or indirectly in British Columbia;

(e)        the underwriters contractually agree that they will observe this restriction regarding the prohibition of offering in British Columbia;

(f)         the securities to be distributed are initially issued in temporary form exchangeable for definitive securities 40 days after completion of the distribution upon certification by the holder that the definitive securities are not beneficially owned by British Columbia residents; and

(g)        the Executive Director has not advised the issuer in writing that its securities are not eligible to use the exemption set out in this order; and

2.         under section 76 of the Securities Act, that a trade in a non-convertible debt security acquired by the seller pursuant to section 1 of this order is deemed to be a distribution unless:

(a)        if the issuer was not a reporting issuer at the date of issue of the non-convertible debt security, the resale requirements of section 140 of the Securities Rules have been complied with; or 

(b)        if the issuer was a reporting issuer at the date of the issue of the non-convertible debt security:

(i)         the resale requirements of sections 142 of the Securities Rules, except for sections 142(a), (b), (c) and (d), have been complied with; and

(ii)         a 40 day period has elapsed from the date of issue of the non-convertible debt security.

DATED at Vancouver, British Columbia, on November 27, 1997.

Douglas M. Hyndman