The Alberta Securities Commission and the Nunavut Securities Office recently published for comment Proposed Multilateral Instrument 45-109 Prospectus Exemption for Start-up Businesses (MI 45-109).
The proposed exemption is intended to address a funding gap that may exist for very small businesses, many of which may be early-stage businesses. The prospectus exemption is subject to an issuer “lifetime limit” of $1,000,000 on amounts that can be raised under MI 45-109 and the start-up crowdfunding prospectus exemption adopted in certain other provinces. In addition, investors are limited to investing up to $1,500 in a single investment within a 12-month period. Where a registered dealer is involved, investors may invest up to $5,000 in a single investment within a 12-month period.
The proposed exemption differs from the start-up crowdfunding prospectus exemption adopted in certain other jurisdictions. Notably, no online funding portal is required to raise funds under the proposed exemption. The proposed exemption, however, does not include an accompanying registration exemption.
Comments are due on December 18, 2015.