NIN 99/48 - Advance Notice of National Instrument 62-101, National Instrument 62-102 and National Instrument 62-103 Early Warning System and Related Matters [NIN - Rescinded]
| Published Date: | 1999-12-17 |
|---|---|
| Effective Date: | 1999-12-15 |
National Instrument 62-101 Control Block Distribution Issues, National Instrument 62-102 Disclosure of Outstanding Share Data and National Instrument 62-103 The Early Warning System and Related Take-Over Bid and Insider Reporting Issues (collectively the "National Instruments") are initiatives of the Canadian Securities Administrators ("CSA") and, together with consequential amendments to the Securities Rules, provide limited exemptions for eligible institutional investors from the early warning, insider reporting and control person distribution requirements. The National Instruments have a number of provisions that apply to all reporting issuers, pledgees and other market participants that are not eligible institutional investors.
The Commission has not yet made the National Instruments as rules, nor has it made the related consequential amendments to the Securities Rules. This Advance Notice is being published to provide notice that the Commission expects to make the National Instruments as rules on or before March 15, 2000 when the National Instruments are expected to come into force as a rule in British Columbia, Alberta, Manitoba, Ontario and Nova Scotia, as a Commission regulation in Saskatchewan, and as a policy in all other jurisdictions represented by the CSA. Subject to comments received on the proposed repeal of sections 173 and 175 of the Securities Rules discussed below, the Commission expects to make the related consequential amendments at the same time as the National Instruments.
When made as rules, the National Instruments and the consequential amendments to the Securities Rules, together with related documents, will be published in the Weekly Summary. The Ontario Securities Commission ("OSC") and the Alberta Securities Commission ("ASC") have already adopted the National Instruments as rules effective March 15, 2000. The Commission anticipates publishing the National Instruments in February 2000, once it has received all necessary approvals.
Background
The Commission, together with other members of the CSA, published drafts of the National Instruments for comment on September 4, 19981.
1 NIN#98/53
The Commission received ten submissions from a total of nine commenters during the comment period which expired on December 7, 1998. The comments provided in these submissions have been considered by the CSA and the final versions of the National Instruments reflect the decisions of the CSA.
The National Instruments may be found on the OSC website at www.osc.gov.on.ca. A full description of the comments received, and the response of the CSA to the comments, may also be found in the OSC Notice relating to the National Instruments on the OSC website.
Substance and Purpose of the National Instruments
The National Instruments provide limited exemptions for eligible institutional investors from the prospectus requirements applicable to control block distributions, the early warning requirements, and the insider reporting requirements contained in the Securities Act. This relief is designed to facilitate compliance by financial institutions, pension funds, certain mutual funds, portfolio managers, portfolio clients, underwriters in the course of a distribution and pledgees.
The National Instruments also require a reporting issuer to disseminate reliable information to the public on the designation and number or principal amount of outstanding securities of the reporting issuer. Reliable disclosure is essential for the purposes of the early warning requirements and the alternative monthly reporting system, contained in the National Instruments.
Consequential Amendments
In order to avoid inconsistencies between the Securities Rules and the National Instruments, consequential amendments to the Securities Rules will be required. The changes being proposed are to repeal sections 173 and 175 of the Securities Rules as similar provisions will now be contained in the National Instruments. The proposed consequential amendments to the Securities Rules are being published with this Advance Notice.
Interested parties are invited to make written submissions with respect to the proposed consequential amendments to the Securities Rules. Submissions received by February 17, 2000 will be considered. Submissions should be sent to:
Brenda J. Benham
Director
Policy and Legislation
British Columbia Securities Commission
200 - 865 Hornby Street
Vancouver, B.C. V6Z 2H4
bbenham@bcsc.bc.ca
Comment letters submitted in response to requests for comments are placed in the public file and form part of the public record, unless confidentiality is requested. Although comment letters requesting confidentiality will not be placed in the public file, freedom of information legislation may require the Commission to make comment letters available. Persons submitting comment letters should, therefore, be aware that the press and members of the public may be able to obtain access to any comment letter.
Questions on the National Instruments and the proposed consequential amendments may be referred to:
Laura Startup
Senior Legal Counsel
Policy and Legislation
British Columbia Securities Commission
(604) 899-6748
or (800) 373-6393 (in B.C.)
lstartup@bcsc.bc.ca
DATED at Vancouver, British Columbia, on December 15, 1999
Douglas M. Hyndman
Chair
Ref: NIN#98/53
This NIN refers to other documents. These documents can be found at the B.C. Securities Commission public website atwww.bcsc.bc.cain the Policy Documents Database.