In January 2015, regulators amended NI 31103 – Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31103), to change the language in Sections 11.9 and 11.10 (the sections associated with providing advance notice to a regulator regarding changes in ownership), to simplify and clarify these provisions.
Prior to the January 2015 amendments, if Individual A owned 100% of a registrant and then decided to interpose a holding company between the individual and the registrant, no advance notice was required, as Individual A still beneficially/indirectly owned 100% of the registrant and could rely on exemption language in these provisions.
The January 2015 amendments removed the exemption language. Accordingly, advance notice may now be required, even when beneficial/indirect ownership has not changed.
Implications. We often advise registrants that are transferring their ownership in a registrant to a holding company for tax planning purposes or other corporate reasons. As mentioned, prior to January 2015, the transfer was expressly exempt from the advance notice requirement in Sections 11.9 and 11.10. However, with the removal of the exemption language, things are somewhat murky since there is no clear policy rationale for the removal of the exemption language.