On September 21, 2023, the Canadian Securities Administrators (“ACVM”) announced modification projects for Regulation 44-102 and other general regulations and instructions. The aim of these modifications is to establish a permanent prior prospectus regime for well-known established issuers (“EEBC”). This EEBC regime has been tested since January.
Regulation 44-102, which governs the public offering of securities through a preliminary prospectus, is set to experience a significant revision. With these proposed changes, ACVM hopes to expedite the securities offering process for well-known and established issuers.
The EEBC regime, now being considered for permanence after a testing phase, is designed to permit faster access to capital markets for established businesses with a track record in the Canadian market, reducing procedural delays. This development adheres to global trends where market authorities aim to foster dynamic business environments through flexible regulation.
This course of action by the ACVM does come with its inherent challenges and potential questioning from the legal community. Primarily, there will be considerable focus on defining the purview of “well-known established issuers,” on which the efficiency and effectiveness of the entire regulatory adjustment hinges.
Further details, analysis, and legal implications of this important development in Canadian securities law will be closely monitored and reported in subsequent coverage.