Tapping Into New Markets – Dual Listing on the New Santiago Stock Exchange, Venture
Canadian mining exploration issuers now have a new and efficient way to access Latin American capital markets. On May 5, 2015, the Santiago Stock Exchange, Venture (“Santiago Venture Exchange“) commenced operations. This new exchange is a culmination of an initiative by the TSX Venture Exchange (“TSXV“) and the Santiago Stock Exchange to streamline dual listing procedures and provide TSXV-listed companies with access to public venture capital markets in both Chile and Canada. Initially, the Santiago Venture Exchange will focus on capital formation for small and medium-sized issuers in the mining sector, but may expand to other sectors in the future.
The Santiago Venture Exchange seeks to encourage the listing and financing of exploration-stage mining companies which are also compliant with the Canadian securities regulatory regime. Companies listed on the Santiago Venture Exchange must also be listed on the TSXV.
In the past two decades, Chile has grown to become one of Latin America’s largest and most prosperous economies. Dual-listed issuers will not only have access to Chilean venture capital, but also to the wider Latin American Integrated Market (MILA), a program that integrates the major stock exchanges of Chile, Mexico, Colombia, and Peru.
In response to the Santiago Venture Exchange initiative, the securities regulators in British Columbia, Alberta, Saskatchewan, Quebec, Nova Scotia and New Brunswick have adopted substantially similar blanket orders that permit Santiago Venture Exchange-listed issuers to continue to benefit from tailored venture issuer disclosure requirements, which we discussed in April 2015. Without the blanket orders, dual-listed issuers would be caught by foreign listing restrictions and would not meet the definition of “venture issuer” in National Instrument 51-102 Continuous Disclosure Obligations and other regulatory instruments. We note that TSXV-listed issuers that wish to become dual-listed, and are reporting issuers in Ontario, will have to apply to the Ontario Securities Commission for exemptive relief to retain their “venture issuer” status and continue to benefit from the new disclosure regime.
by David Andrews
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 2015
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