Woman making a frame around the sun with her hands at sunrise
Woman making a frame around the sun with her hands at sunrise
Woman making a frame around the sun with her hands at sunrise

Adoption of Amendments to Start-up Crowdfunding Blanket Orders

July 2016 Capital Markets Bulletin 2 minutes read

In 2015, securities regulators in British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia (the Participating Jurisdictions) adopted substantially harmonized registration and prospectus exemptions proposed under Multilateral Instrument 45-108 – Crowdfunding (MI 45-108). The start-up crowdfunding exemptions (the Crowdfunding Exemptions), which aim to provide start-up and early stage companies with an alternative to raise capital with fewer disclosure requirements, were discussed in our bulletin Certain Canadian Securities Regulators Adopt Crowdfunding Prospectus Exemption for Start-ups. The Participating Jurisdictions implemented the Crowdfunding Exemptions by way of local blanket orders (Exemption Orders).

Effective June 30, 2016, the Participating Jurisdictions (except British Columbia) have made additional amendments[1] to the Exemption Orders and corresponding start-up forms and guides (the Amendments).

The Amendments reflect the new filing requirements relating to exempt market filings that came into force on May 24, 2016, specifically the new requirement in all Participating Jurisdictions (except British Columbia) that issuers with exempt market filings electronically file their offering document and report of exempt distribution through the System for Electronic Document Analysis and Retrieval (SEDAR). Although issuers in British Columbia will continue to file through BCSC eServices, they are now required to file a new Form 45-106F1 Report of Exempt Distribution.

The Participating Jurisdictions anticipate that the Amendments will provide additional clarification regarding the expectations on funding portals and issuers relying on the Crowdfunding Exemptions. The Amendments also include changes of a housekeeping nature.

For further information regarding the Amendments, please see Multilateral CSA Notice 45-319 Amendments to Start-up Crowdfunding Registration and Prospectus Exemptions.

Those interested in the Crowdfunding Exemptions are encouraged to review the details in Multilateral Instrument 45-108 – Crowdfunding or seek legal advice to determine if this exemption is a good fit for your start-up’s capital raising needs

by Andjela Vukobrat

[1] On January 25, 2016, the Participating Jurisdictions, with the exception of British Columbia, amended the Exemption Orders to allow a funding portal registered as a restricted dealer and authorized under the terms and conditions of MI 45-108 to facilitate the distribution of securities under the start-up crowdfunding prospectus exemption.

A Cautionary Note

The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.

© McMillan LLP 2016

Related Publications (5 Posts)

Featured Insight

The Canadian Capital Market is Psyched: An Update on the Growing Wave in the Psychedelics Industry

This bulletin provides an overview of the regulations surrounding psychedelics in Canada and psychedelics companies in the Canadian capital markets.

Read More
May 12, 2021
Featured Insight

Stopping a Slippery Slope: Ontario Divisional Court Clarifies that Auto Insurance Coverage Applies Only to Direct Causes of Injuries

Ontario Divisional Court clarifies that automobile insurance only applies to direct causes of injury under the Statutory Accidents Benefits Schedule.

Read More
May 12, 2021
Featured Insight

What Are You Suing Me For? I Had No Control: Lessor Fleet Liability

The decision in Barz concerns the interplay between Alberta’s Workers’ Compensation Act and Traffic Safety Act.

Read More
May 12, 2021
Featured Insight

Paid COVID-19 Sick Leave for British Columbia Employees

The British Columbia government has announced proposed amendments to the Employment Standards Act to provide for paid sick leave.

Read More
May 12, 2021
Featured Insight

A “vaccine break” for COVID-19 vaccination

Quebec follows the lead of the common law provinces taking legislative action to encourage vaccination.

Read More
May 12, 2021