CSA 95/03 - SEDAR [CSA Notice - Rescinded]

On June 15, 1994, the Canadian Securities Administrators ("CSA") published CSA Notice #94/1 (the "Notice") entitled "An Electronic System for Securities Filings. The Notice introduced SEDAR (System for Electronic Document Analysis and Retrieval/Système électronique de document d'analyse et de recherche). This notice is designed to update the filing community on the progress of the development of SEDAR.

General

Following the publication of the Notice, the CSA committee charged with responsibility for the development of SEDAR continued to work with IBM as IBM developed the SEDAR application. The first version of the application was delivered to CSA in October, 1994 and since that time it has been subjected to rigorous testing by the securities commissions in Quebec, Ontario and British Columbia. As a result of that testing, a number of issues were identified and a new interim version of the application is due to be delivered in July, 1995. Introduction of SEDAR as the method for filing securities documents is now scheduled for early 1996.

CDS

The major development in the SEDAR project has been the introduction of the Canadian Depository for Securities Ltd. ("CDS"). CDS is a privately held corporation owned by members of the Investment Dealers' Association of Canada, the Montreal and Toronto stock exchanges and a number of the larger Canadian banks and trust companies. In December, 1994, CDS purchased the SEDAR application from IBM. Under the terms of the agreement with IBM, CDS will ultimately assume responsibility for the operations and management for SEDAR. IBM will complete the application development and Advantis Canada, an IBM affiliate, will provide the network upon which SEDAR will run.

CDS has, for a number of years, played a key role in the Canadian securities markets, acting as the depository for the majority of equity securities held in this country. That important role will now be expanded with its management of SEDAR.

WordPerfect/MicroSoft Word

In the Notice, CSA announced its preliminary decision to require the use of IBM compatible WordPerfect 5.1 or 5.2 as the standard for use in SEDAR. This proposal has generated more comment from the filing community than any other. In the result, CSA has consulted with IBM and CDS and come to the conclusion that, on balance, it is preferable to include the use of WordPerfect and MicroSoft Word as the two wordprocessing formats to be accepted. The required version of each of WordPerfect and MicroSoft Word will be determined in the near future and announced in a subsequent CSA notice.

Mandating

Use of the EDGAR electronic filing system of the Securities and Exchange Commission of the United States is mandated for most U.S. securities filers. CSA has considered the comments received in response to the Notice and has consulted with the filing community. CSA has come to the conclusion that, subject to the successful testing of SEDAR, each CSA jurisdiction will take those steps within its power to require the use of SEDAR for at least those issuers who file nationally. A decision with respect to filers who file in only one jurisdiction will be made at a later date.

The process through which SEDAR will be mandated will vary by jurisdiction. In certain jurisdictions, it may be accomplished by changes to policy or the introduction of rules. In others, it may require legislative change. Not all national filers will be mandated to use SEDAR at the same time. Mandating will occur according to a schedule, to be published in a subsequent CSA notice, that will add identifiable filer groups one at a time.

Conclusion

SEDAR is progressing toward implementation. The addition of CDS marks a significant step in SEDAR's development.

Questions may be referred to

Wade D. Nesmith                                     Pascal Mercier
Lang Michener                                          Lawrence & Shaw Lavery, de Billy
Barristers and Solicitors                         Barristers and Solicitors
(604) 691-7415                                         (514) 871-1522

Mark DesLauriers                                     Richard Proulx
Osler, Hoskin & Harcourt                        Commission des Valeurs
Barristers and Solicitors                          Mobilieres du Quebec
(416) 862-5914                                          (514) 873-5009

Karen Eby                                                  Sandy MacDonald
Ontario Securities Commission           BritishColumbia Securities Commission
(416) 593-8242                                         (604) 660-4800

April 21, 1995