The Investment Dealers Association has issued a notice regarding a National Instrument 54-101 Communication with Beneficial Owners of securities, which takes effect on July 1.
The new instrument replaces National Policy 41 on shareholder communication. However, it contains transitional provisions that will delay the implementation of some of the requirements.
NI 54-101 continues to affirm the intent of NP41, which is to establish an obligation on reporting issuers to send proxy-related materials to the beneficial owners of securities who are not registered holders of its securities, to provide a procedure for the sending of proxy-related materials and other materials to beneficial owners, and, to impose obligations on various parties in the securityholder communication process.
It also brings some significant changes, including:
- procedures to permit reporting issuers to obtain a list of beneficial owners of their securities who do not object to the disclosure of their names;
- the scope of materials that a beneficial owner may decline to receive has been narrowed;
- issuers that send materials indirectly to beneficial owners may no longer bear the costs of sending materials by intermediaries; and
- reporting issuers can now deal only with the intermediary.