The Securities Commission has granted an exemption to a Canadian subsidiary (Subco) of a Netherlands-listed company (Parent) from certain Canadian continuous disclosure, certification, audit committee, and insider reporting requirements. This decision is based on the Parent providing a full and unconditional guarantee of Subco’s outstanding debt securities.
Key points of the decision include:
– Subco is exempt from continuous disclosure requirements under National Instrument 51-102 (NI 51-102) and audit committee requirements under National Instrument 52-110 (NI 52-110), provided the Parent maintains ownership of all Subco voting securities and complies with Dutch financial reporting and market abuse regulations.
– Subco is also exempt from certification requirements under National Instrument 52-109 (NI 52-109) and insiders of Subco are exempt from insider reporting requirements under National Instrument 55-102 (NI 55-102) and National Instrument 55-104 (NI 55-104), with conditions.
– The Parent’s securities are not registered under the U.S. Securities Exchange Act of 1934, and Canadian residents own less than 10% of the Parent’s equity securities.
– The Parent is subject to the Netherlands Listing Rules and the European Market Abuse Regulation, ensuring compliance with rigorous disclosure requirements.
– Subco is not required to issue financial statements to debt holders as per the terms of the debt securities indenture.
– The exemption is conditional upon Subco filing all Parent’s disclosure documents required in the Netherlands on the Canadian System for Electronic Document Analysis and Retrieval (SEDAR) and providing consolidating summary financial information.
– The exemption will expire five years from the date of the decision.
The decision is underpinned by various legislative provisions, including the Securities Act (Ontario), the Business Corporations Act (Ontario), and several National Instruments (NI 51-102, NI 52-109, NI 52-110, NI 55-102, NI 55-104, and NI 58-101). The exemption aims to align Subco’s reporting obligations with those of the Parent and to avoid the release of potentially misleading financial information.