(September 19 – 18:15 ET) – The Canadian Venture Exchange has applied for an exemption from recognition as a stock exchange under the Ontario Securities Act.
The CDNX has received a temporary exemption from the OSC, and has published a notice contemplating a permanent exemption. The commission has approved a Memorandum of Understanding among the Alberta, B.C. and Ontario securities commissions for oversight of CDNX.
The memorandum sets out a minimum standard of oversight to be undertaken by the ASC and BCSC, including performing examinations and rule review. If an exemption from recognition is granted to CDNX the OSC would rely on the oversight performed by the ASC and BCSC. The ASC and BCSC would have an obligation to report to the OSC on their oversight activities on a quarterly basis as well as annually to the Canadian Securities Administrators chairmen.
CDNX has proposed rules that would require each CDNX listed issuer with a “significant connection” to Ontario to become a reporting issuer in Ontario. An issuer would have a significant connection if: 20% of its non-objecting beneficial owners reside in Ontario, or 10% of the non-objecting beneficial owners and the CEO, head office, and CFO of the issuer are located in Ontario.
These amendments will take effect June 30, 2001. All CDNX issuers must determine whether they meet the significant connection test by that date and if so they must promptly apply to be deemed a reporting issuer in Ontario and must achieve that status within six months. On an ongoing basis, all CDNX issuers must undertake an annual assessment to determine whether they meet the significant connection test and, if so, must become Ontario reporting issuers.
Comments regarding the application for exemption from recognition are due by October 1.
-IE Staff