The Securities Commission has granted the Asian Infrastructure Investment Bank (AIIB) an exemption from the prospectus requirement for issuing or guaranteeing debt securities in Canadian or US currency. This decision is based on the AIIB’s similarities to other permitted supranational agencies listed in subsection 2.34(1) of National Instrument 45-106 Prospectus Exemptions (NI 45-106), which are already exempt. The AIIB, an international organization established to support infrastructure development in Asia, is not a reporting issuer in Canada and does not intend to become one.
The exemption is subject to two conditions: the debt securities must be payable in Canadian or US currency, and the exemption will expire two years from the date of the decision. The AIIB’s operations, governance, and financial status were considered in making this decision, including its triple-A credit rating and recognition by the Basel Committee on Banking Supervision, which allows for a 0% risk weight for bank claims on the AIIB.
The decision was made under the authority of sections 53 and 74(1) of the Securities Act (Ontario) and is consistent with the test set out in the securities legislation for granting such an exemption. The exemption aims to facilitate the AIIB’s ability to raise funds for its development activities without the need for a prospectus, acknowledging its status as a multilateral development bank with a public policy mandate.