Canadian securities regulators are moving forward with several rule changes (new MI 45-107 and amendments to NI 33-105) that will facilitate private placement offerings of foreign securities to Canadian institutional investors that qualify as “Canadian permitted clients”. The cumulative effect of the rule changes will be to eliminate the need to prepare a “wrapper document” providing Canada-specific disclosures to supplement the foreign offering document. These rule changes, together with the proposed amendments to OSC Rule 45-501 which were published for comment earlier this year, will make generally available by legislation that will operate across Canada relief that has been granted in Ontario by way of exempting ruling since April of this year on applications by non-Canadian investment banks.
As was the case with wrapper exemption orders, the rule changes will eliminate the need for “connected issuer” and “related issue” disclosures, “rights of civil action” disclosure and prohibitions on exchange listing representations that would otherwise have to be included in wrappers. A comment period on the CSA initiatives closes February 26, 2014.