Canadian securities regulators are making a series of changes to assorted prospectus rules in order to address various issues that have cropped up since they were first implemented, clarifying the rules, streamlining them, and closing certain gaps.
The Canadian Securities Administrators (CSA) announced that they are adopting amendments to both the issuer and mutual fund prospectus rules in response to both user feedback, and the CSA’s experience with the current version of the prospectus rules, which were implemented in the spring of 2008.
In a notice spelling out the changes to National Instrument (NI) 41-101 General Prospectus Requirements, NI 44-101 Short Form Prospectus Distributions, NI 44-102 Shelf Distributions, NI 81-101 Mutual Fund Prospectus Disclosure, and related policies, the CSA says that the amendments aim to clarify certain provisions of the prospectus rules; address gaps in the rules; to modify certain requirements in an effort to enhance their effectiveness; and, to remove or streamline certain requirements that are needlessly burdensome. Additionally, they will formally codify prospectus relief that has been granted in the past.
The CSA indicates that it has been tracking any issues that emerged once the prospectus rules were implemented, and developed amendments to address those issues where it’s warranted. Proposed amendments were first published for comment in July 2011, and they have since been revised in response to the comments.
“The CSA constantly reviews the effectiveness of its rules, regulations and policies to ensure they are meeting the needs of both investors and market participants,” said Bill Rice, chair of the CSA and chair and CEO of the Alberta Securities Commission (ASC). “These changes clarify, modify or eliminate aspects of the prospectus rules to make the process more streamlined and accessible to users.”
Subject to ministerial approval in certain jurisdictions, the amendments will take effect on May 14.