The Canadian Securities Administrators (“CSA”) today published CSA Notice 62-307. It provides an update to proposed amendments (the “Proposed Amendments”)to early-warning reporting published for comment on March 13, 2013.
The Proposed Amendments would have significantly expanded early-warning obligations for investors in securities of Canadian public issuers. The most significant proposal was to decrease the early-warning threshold from 10% to 5%.
Based on over 70 comment letters received from various market participants, the CSA decided not to proceed with certain of the Proposed Amendments. Most significantly, the final amendments, expected to be published in the second quarter of 2015, will not decrease the early-warning threshold from 10% to 5%. In addition, the final amendments will not include “equity equivalent derivatives” for the purposes of determining the early-warning threshold.
The CSA continues to believe that the final amendments, while not as extensive as the Proposed Amendments, will enhance the quality and integrity of the early-warning regime in a manner that is appropriate for the Canadian public capital markets.