In an effort to reduce compliance costs for the mining industry and enhance investor insight, the Canadian Securities Administrators (CSA) is proposing reforms to streamline and modernize disclosure requirements for the sector.
The CSA launched a consultation Thursday on the proposed changes, which aim to address evolving industry disclosure practices and better align requirements with industry and investor expectations.
The proposals remove or update certain definitions from the rules, scrap outdated disclosure requirements, and streamline others.
The proposed changes follow a consultation by the CSA in 2022, which attracted significant feedback.
In a notice outlining the proposals, the CSA said the changes are expected to reduce compliance costs for mining issuers. They may also improve issuers’ ability to assess risk and opportunity by offering greater regulatory certainty and aligning with international expectations.
For investors and financial advisors, the reforms aim to provide more useful information on mining issuers’ projects — helping investors make better-informed decisions.
“This in turn will potentially reduce the cost of capital and enhance capital formation,” the CSA said.
“Our goal is to provide investors with clear, reliable information about mineral projects so they can make informed decisions, without imposing an undue regulatory burden on mining issuers,” said Stan Magidson, chair of the CSA and chair and CEO of the Alberta Securities Commission, in a release.
“By modernizing and streamlining the disclosure regime, we aim to maintain Canada’s position as the global standard for mining disclosure,” he added.
While the reforms are expected to lower ongoing compliance costs for mining issuers, adopting the new rules will involve upfront costs.
In a cost-benefit analysis, the Ontario Securities Commission estimated the changes would save Ontario-based mining issuers between $1 million and $1.7 million annually. However, they would face one-time transition costs of between $1.2 million and $2.6 million. Only 21% of Canadian mining issuers have the OSC as their principal regulator; 70% fall under the British Columbia Securities Commission.
The proposals are open for a 120-day comment period, ending Oct. 10.