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Contents
1 (1) In this Act:
"adviser" means a person engaging in, or holding himself, herself or itself out as engaging in, the business of advising another with respect to investment in or the purchase or sale of securities or exchange contracts;
"associate" means, if used to indicate a relationship with any person,
(a) a partner, other than a limited partner, of that person,
(b) a trust or estate in which that person has a substantial beneficial interest or for which that person serves as trustee or in a similar capacity,
(c) an issuer in respect of which that person beneficially owns or controls, directly or indirectly, voting securities carrying more than 10% of the voting rights attached to all outstanding voting securities of the issuer, or
(d) a relative, including the spouse, of that person or a relative of that person's spouse, if the relative has the same home as that person;
"business day" means a day other than Saturday or a holiday;
"Business Development Bank of Canada" means the Business Development Bank of Canada incorporated under the Business Development Bank of Canada Act (Canada);
"class of exchange contracts" includes a series of a class of exchange contracts;
"class of securities" includes a series of a class of securities;
"clearing agency" means a person who
(a) in connection with trades in securities, acts as an intermediary in paying funds, in delivering securities or in doing both of those things,
(b) provides centralized facilities through which trades in securities or exchange contracts are cleared, or
(c) provides centralized facilities as a depository of securities;
"commission" means the British Columbia Securities Commission continued under Part 2;
"commission rule" means a rule made or deemed to be made by the commission under section 184;
"contract" includes a trust agreement, declaration of trust or other similar instrument;
"contractual plan" means a contract or other arrangement for the purchase of securities of a mutual fund by payments over a specified period or by a specified number of payments where the amount deducted from any one of the payments as sales charges is larger than the amount that would have been deducted from that payment for sales charges if deductions had been made from each payment at a constant rate for the duration of the plan;
"control person" means
(a) a person who holds a sufficient number of the voting rights attached to all outstanding voting securities of an issuer to affect materially the control of the issuer, or
(b) each person in a combination of persons, acting in concert by virtue of an agreement, arrangement, commitment or understanding, which holds in total a sufficient number of the voting rights attached to all outstanding voting securities of an issuer to affect materially the control of the issuer,
and, if a person or combination of persons holds more than 20% of the voting rights attached to all outstanding voting securities of an issuer, the person or combination of persons is deemed, in the absence of evidence to the contrary, to hold a sufficient number of the voting rights to affect materially the control of the issuer;
"dealer" means a person who trades in securities or exchange contracts as principal or agent;
"decision" means a direction, decision, order, ruling or requirement made under a power or right conferred by this Act or the regulations;
"designated organization" means an organization that is authorized under section 184 (2) (e) to exercise a power or perform a duty of the executive director;
"designated security", as used in the definition of "private issuer", means
(a) voting securities, or
(b) securities that are not debt securities and that carry a residual right to participate in the earnings of the issuer or, on the liquidation or winding up of the issuer, in its assets;
"director" means a director of a corporation or an individual occupying or performing, with respect to a corporation or any other person, a similar position or similar functions;
"distribution" means, if used in relation to trading in securities,
(a) a trade in a security of an issuer that has not been previously issued,
(b) a trade by or on behalf of an issuer in a previously issued security of that issuer that has been redeemed or purchased by or donated to that issuer,
(c) a trade in a previously issued security of an issuer from the holdings of a control person,
(d) a trade by or on behalf of an underwriter in a security that was acquired by the underwriter, acting as underwriter, before February 1, 1987, if the security continues, on February 1, 1987, to be owned by or on behalf of that underwriter so acting,
(e) a trade deemed to be a distribution
(i) in an order made under section 76 by the commission or the executive director, or
(ii) in the regulations,
(f) a transaction or series of transactions involving further purchases and sales in the course of or incidental to a distribution, and
(g) a prescribed class of trade or transaction;
"distribution contract" means a contract under which a mutual fund or its legal representative grants to a person the right to purchase the securities of the mutual fund for distribution or to distribute the securities of the mutual fund on behalf of the mutual fund;
"exchange contract" means a futures contract or an option that meets both of the following requirements:
(a) its performance is guaranteed by a clearing agency;
(b) it is traded on an exchange pursuant to standardized terms and conditions set out in that exchange's bylaws, rules or regulatory instruments, at a price agreed on when the futures contract or option is entered into on the exchange,
and includes another instrument or class of instruments that meets both of those requirements and is designated as an exchange contract in an order the commission may make for the purpose of this definition;
"exchange issuer" means an issuer whose securities are listed and posted for trading on an exchange recognized for the purpose of this definition by the commission, but does not include
(a) an issuer, or
(b) a class of issuers
described in an order which the commission may make for the purpose of this definition;
"executive director" means the executive director appointed under section 8;
"futures contract" means a contract to make delivery or take delivery on a specified date or during a specified period of
(a) a specified cash equivalent of the subject matter of the contract, or
(b) a specified asset;
"holder in British Columbia" means, in respect of a security of an issuer, a holder of the security of the issuer whose last address as shown on the books of the issuer is in British Columbia;
"individual" means a natural person, but does not include
(a) a partnership, unincorporated association, unincorporated syndicate, unincorporated organization or trust, or
(b) a natural person in the person's capacity as a trustee, executor, administrator or personal or other legal representative;
"insider" means, if used in relation to an issuer,
(a) a director or senior officer of the issuer,
(b) a director or senior officer of a person that is itself an insider or subsidiary of the issuer,
(c) a person that has
(i) direct or indirect beneficial ownership of,
(ii) control or direction over, or
(iii) a combination of direct or indirect beneficial ownership of and of control or direction over
securities of the issuer carrying more than 10% of the voting rights attached to all the issuer's outstanding voting securities, excluding, for the purpose of the calculation of the percentage held, any securities held by the person as underwriter in the course of a distribution, or
(d) the issuer itself, if it has purchased, redeemed or otherwise acquired any securities of its own issue, for so long as it continues to hold those securities;
"insurer" means an insurance company;
"investor relations activities" means any activities or oral or written communications, by or on behalf of an issuer or security holder of the issuer, that promote or reasonably could be expected to promote the purchase or sale of securities of the issuer, but does not include
(a) the dissemination of information provided, or records prepared, in the ordinary course of the business of the issuer
(i) to promote the sale of products or services of the issuer, or
(ii) to raise public awareness of the issuer,
that cannot reasonably be considered to promote the purchase or sale of securities of the issuer,
(b) activities or communications necessary to comply with the requirements of
(i) this Act or the regulations, or
(ii) the bylaws, rules or other regulatory instruments of a self regulatory body or exchange,
(c) communications by a publisher of, or writer for, a newspaper, news magazine or business or financial publication, that is of general and regular paid circulation, distributed only to subscribers to it for value or to purchasers of it, if
(i) the communication is only through the newspaper, magazine or publication, and
(ii) the publisher or writer receives no commission or other consideration other than for acting in the capacity of publisher or writer, or
(d) activities or communications that may be prescribed for the purpose of this definition;
"issuer" means a person who
(a) has a security outstanding,
(b) is issuing a security, or
(c) proposes to issue a security;
"management contract" means a contract under which a mutual fund is provided with investment advice;
"material change" means, if used in relation to the affairs of an issuer, a change in the business, operations, assets or ownership of the issuer that would reasonably be expected to have a significant effect on the market price or value of any of the securities of the issuer, and includes a decision to implement that change made by
(a) senior management of the issuer who believe that confirmation of the decision by the directors is probable, or
(b) the directors of the issuer;
"material fact" means, where used in relation to securities issued or proposed to be issued, a fact that significantly affects, or could reasonably be expected to significantly affect, the market price or value of those securities;
"misrepresentation" means
(a) an untrue statement of a material fact, or
(b) an omission to state a material fact that is
(i) required to be stated, or
(ii) necessary to prevent a statement that is made from being false or misleading in the circumstances in which it was made;
"mutual fund" includes an issuer of a security that entitles the holder to receive on demand, or within a specified period after demand, an amount computed by reference to the value of a proportionate interest in the whole or in a part of the net assets, including a separate fund or trust account, of the issuer of the security;
"mutual fund distributor" means a person distributing a security under a distribution contract;
"mutual fund in British Columbia" means a mutual fund that is
(a) a reporting issuer, or
(b) organized under the laws of British Columbia,
but does not include a private mutual fund;
"mutual fund manager" means a person who provides investment advice under a management contract;
"officer" means the chair or a vice chair of the board of directors, the president, a vice president, the secretary, an assistant secretary, the treasurer, an assistant treasurer, the general manager and any other individual appointed an officer of a corporation or acting in a capacity similar to those specified offices on behalf of an issuer or a registrant;
"person" includes an individual, corporation, partnership, party, trust, fund, association and any other organized group of persons and the personal or other legal representative of a person to whom the context can apply according to law;
"portfolio manager" means an adviser who manages the investment portfolio of clients through discretionary authority granted by one or more clients;
"portfolio security" means, if used in relation to a mutual fund, a security held or proposed to be purchased by the mutual fund;
"private issuer" means a person that
(a) is not a reporting issuer or a mutual fund,
(b) is an issuer all of whose issued and outstanding securities that are designated securities
(i) are subject to restrictions on transfer contained in
(A) the constating documents of the issuer, or
(B) one or more agreements between the issuer and the holders of its designated securities, and
(ii) are beneficially owned, directly or indirectly, by not more than 50 persons, counting any 2 or more joint registered owners as one beneficial owner, exclusive of persons
(A) that are employed by the issuer or an affiliate of it, or
(B) that beneficially owned, directly or indirectly, designated securities of the issuer while employed by it or by an affiliate of it and, at all times since ceasing to be so employed, have continued to beneficially own, directly or indirectly, at least one designated security of the issuer, and
(c) has not distributed to the public after October 31, 1989 any of its designated securities or any securities convertible into or exchangeable for its designated securities;
"private mutual fund" means a mutual fund that is
(a) operated as an investment club, if
(i) the securities issued by it are held by not more than 50 persons and it has never sought to borrow money from the public,
(ii) it does not pay or give any remuneration for investment, management or administration advice in respect of trades in securities or exchange contracts, except normal brokerage fees, and
(iii) all of its members are required, for the purpose of financing its operations, to make contributions in proportion to the securities issued by it that each member holds, or
(b) administered by a trust company but which has no promoter or manager other than a trust company, and consists of
(i) a pooled fund that is maintained solely to serve registered retirement savings plans, retirement income plans, deferred profit sharing plans, pension plans or other similar plans registered under the Income Tax Act (Canada),
(ii) a common trust fund as defined by the Financial Institutions Act, or
(iii) a pooled fund that is maintained by a trust company in which money, belonging to various estates and trusts in its care, is commingled, with the authority of the settlor, testator or trustee, for the purpose of facilitating investment if no general solicitations are made to sell securities in the fund;
"promoter" means, if used in relation to an issuer, a person who
(a) acting alone or in concert with one or more other persons, directly or indirectly, takes the initiative in founding, organizing or substantially reorganizing the business of the issuer, or
(b) in connection with the founding, organization or substantial reorganization of the business of the issuer, directly or indirectly receives, in consideration of services or property or both, 10% or more of a class of the issuer's own securities or 10% or more of the proceeds from the sale of a class of the issuer's own securities of a particular issue,
but does not include a person who
(c) receives securities or proceeds referred to in paragraph (b) solely
(i) as underwriting commissions, or
(ii) in consideration for property, and
(d) does not otherwise take part in founding, organizing or substantially reorganizing the business;
"registrant" means a person registered or required to be registered under this Act or the regulations;
"regulation", except in sections 155 (1) (f), 183, 184, 186 and 188, includes a commission rule;
"reporting issuer" means an issuer that
(a) has issued securities in respect of which
(i) a prospectus was filed and a receipt was issued,
(ii) a statement of material facts was filed and accepted, or
(iii) a securities exchange take over bid circular was filed,
under a former enactment,
(b) has filed a prospectus or statement of material facts and obtained a receipt for it under this Act or the regulations,
(c) has any securities that have been at any time listed and posted for trading on any exchange in British Columbia, regardless of when the listing and posting for trading began,
(d) is a corporation that has exchanged its securities with another corporation or with the holders of the securities of that other corporation in connection with an amalgamation, merger, reorganization or arrangement if one of the parties to the amalgamation, merger, reorganization or arrangement was a reporting issuer at the time of the amalgamation, merger, reorganization or arrangement, and the corporation that has exchanged its securities is deemed to have been a reporting issuer as at the date of the amalgamation, merger, reorganization or arrangement, for the longest period of time that one of the parties to the amalgamation, merger, reorganization or arrangement had been a reporting issuer at the date of the amalgamation, merger, reorganization or arrangement,
(e) is designated as a reporting issuer in an order which the commission may make for the purpose of this definition, or
(f) has filed a securities exchange take over bid circular under this Act or the regulations,
unless the commission orders under section 88 that the issuer has ceased to be a reporting issuer;
"salesperson" means an individual employed by a dealer to make trades on the dealer's behalf in securities, exchange contracts or both;
"security" includes
(a) a document, instrument or writing commonly known as a security,
(b) a document evidencing title to, or an interest in, the capital, assets, property, profits, earnings or royalties of a person,
(c) a document evidencing an option, subscription or other interest in or to a security,
(d) a bond, debenture, note or other evidence of indebtedness, share, stock, unit, unit certificate, participation certificate, certificate of share or interest, preorganization certificate or subscription other than
(i) a contract of insurance issued by an insurer, and
(ii) an evidence of deposit issued by a savings institution,
(e) an agreement under which the interest of the purchaser is valued, for the purposes of conversion or surrender, by reference to the value of a proportionate interest in a specified portfolio of assets, but does not include a contract issued by an insurer that provides for payment at maturity of an amount not less than 3/4 of the premiums paid by the purchaser for a benefit payable at maturity,
(f) an agreement providing that money received will be repaid or treated as a subscription to shares, stock, units or interests at the option of the recipient or of any person,
(g) a profit sharing agreement or certificate,
(h) a certificate of interest in an oil, natural gas or mining lease, claim or royalty voting trust certificate,
(i) an oil or natural gas royalty or lease or a fractional or other interest in either,
(j) a collateral trust certificate,
(k) an income or annuity contract, other than one made by an insurer,
(l) an investment contract,
(m) a document evidencing an interest in a scholarship or educational plan or trust,
(n) an instrument that is a futures contract or an option but is not an exchange contract, or
(o) an exploration permit under the Petroleum and Natural Gas Act,
whether or not any of the above relate to an issuer, but does not include an exchange contract;
"senior officer" means
(a) the chair or a vice chair of the board of directors, the president, a vice president, the secretary, the treasurer or the general manager of a corporation,
(b) any individual who performs functions for a person similar to those normally performed by an individual occupying any office specified in paragraph (a), and
(c) the 5 highest paid employees of an issuer, including any individual referred to in paragraph (a) or (b) and excluding a commissioned salesperson who does not act in a managerial capacity;
"spouse" means a person who
(a) is married to another person and is not living separate and apart, within the meaning of the Divorce Act (Canada), from the other person, or
(b) is living with another person in a marriage-like relationship,
and, for the purpose of this definition, the marriage or marriage-like relationship may be between members of the same sex;
"subsidiary" means an issuer that is controlled by another issuer;
"trade" includes
(a) a disposition of a security for valuable consideration whether the terms of payment be on margin, installment or otherwise, but does not include a purchase of a security or a transfer, pledge, mortgage or other encumbrance of a security for the purpose of giving collateral for a debt,
(b) entering into an exchange contract,
(c) participation as a trader in a transaction in a security or exchange contract made on the floor of or through the facilities of an exchange,
(d) the receipt by a registrant of an order to buy or sell a security or exchange contract,
(e) a transfer of beneficial ownership of a security to a transferee, pledgee, mortgagee or other encumbrancer under a realization on collateral given for a debt, and
(f) any act, advertisement, solicitation, conduct or negotiation directly or indirectly in furtherance of any of the activities specified in paragraphs (a) to (e);
"underwriter" means a person who,
(a) as principal, agrees to purchase a security for the purpose of distribution,
(b) as agent, offers for sale or sells a security in connection with a distribution, or
(c) participates directly or indirectly in a distribution described in paragraph (a) or (b),
but does not include
(d) a person whose interest in the transaction is limited to receiving the usual and customary distribution or sales commission payable by an underwriter or issuer,
(e) a mutual fund that accepts its securities for surrender and resells them,
(f) a corporation that purchases shares of its own issue and resells them, or
(g) a bank with respect to securities described in section 46 and to prescribed banking transactions;
"voting security" means a security of an issuer that
(a) is not a debt security, and
(b) carries a voting right either under all circumstances or under some circumstances that have occurred and are continuing.
(2) For the purposes of this Act, an issuer is affiliated with another issuer if
(a) one of them is the subsidiary of the other, or
(b) each of them is controlled by the same person.
(3) For the purposes of this Act, an issuer is controlled by a person if
(a) voting securities of the issuer are held, other than by way of security only, by or for the benefit of that person, and
(b) the voting rights attached to those voting securities are entitled, if exercised, to elect a majority of the directors of the issuer.
(4) For the purposes of this Act, a person beneficially owns securities that are beneficially owned by
(a) an issuer controlled by that person, or
(b) an affiliate of that person or an affiliate of any issuer controlled by that person.
2 (1) The following persons are insiders of a mutual fund that is a reporting issuer:
(a) a mutual fund manager for the mutual fund;
(b) a mutual fund distributor for the mutual fund;
(c) an insider of a manager or distributor described in paragraph (a) or (b).
(2) If an issuer becomes an insider of a reporting issuer, every director or senior officer of the issuer is deemed to have been an insider of the reporting issuer for the previous 6 months or for the shorter period that the person was a director or senior officer of the issuer.
(3) If a reporting issuer becomes an insider of another reporting issuer, every director or senior officer of the latter reporting issuer is deemed to have been an insider of the former reporting issuer for the previous 6 months or for the shorter period that the person was a director or senior officer of the latter reporting issuer.
3 For the purposes of sections 86 and 136, a person is in a special relationship with a reporting issuer if the person
(a) is an insider, affiliate or associate of
(i) the reporting issuer,
(ii) a person that is proposing to make a take over bid, as defined in section 92, for the securities of the reporting issuer, or
(iii) a person that is proposing
(A) to become a party to a reorganization, amalgamation, merger, arrangement or similar business combination with the reporting issuer, or
(B) to acquire a substantial portion of the property of the reporting issuer,
(b) is engaging in or is proposing to engage in any business or professional activity with or on behalf of the reporting issuer or with or on behalf of a person described in paragraph (a) (ii) or (iii),
(c) is a director, officer or employee of the reporting issuer or of a person described in paragraph (a) (ii) or (iii) or (b),
(d) knows of a material fact or of a material change with respect to the reporting issuer, having acquired the knowledge while in a relationship described in paragraph (a), (b) or (c) with the reporting issuer, or
(e) knows of a material fact or of a material change with respect to the reporting issuer, having acquired the knowledge from another person at a time when
(i) that other person was in a special relationship with the reporting issuer, whether under this paragraph or any of paragraphs (a) to (d), and
(ii) the person that acquired knowledge of the material fact or material change from that other person knew or reasonably ought to have known of the special relationship referred to in subparagraph (i).
4 (1) The British Columbia Securities Commission is continued under that name, and is constituted as a corporation consisting of its members appointed under subsection (3).
(2) The commission is responsible for the administration of this Act.
(3) The commission consists of not more than 11 members appointed by the Lieutenant Governor in Council.
(4) The Lieutenant Governor in Council may set the terms and conditions of the appointments of the members of the commission including, but not limited to, appointing members of the commission for different terms of office, or for limited, specified purposes or functions or for all purposes or functions of the commission.
(5) The Lieutenant Governor in Council must designate one member of the commission to be chair and chief executive officer of the commission and may designate one or 2 vice chairs of the commission from among its members.
(6) The members of the commission must be reimbursed for any reasonable expenses necessarily incurred by them in the performance of their duties.
(7) If a member of the commission is appointed for a limited, specified purpose or function of the commission, the member
(a) is not to be considered a member of the commission for any other purpose or function than that specified, and
(b) must not participate in any aspect of the commission's business outside the limited, specified purpose or function for which the member was appointed.
(8) When the chair is absent or incapable of acting, the powers and duties of the chair must be exercised and performed by
(a) a vice chair, or
(b) if there is no vice chair, a person appointed by the minister.
(9) The commission may hold hearings in or outside British Columbia in conjunction with any other body empowered by law to administer or regulate trading in securities or exchange contracts and may consult with that other body during the course of a hearing.
(10) A person who is the chair, a vice chair or a member of the commission may exercise the powers and must perform the duties delegated to that person by the commission under section 7.
5 (1) The commission is an agent of the government.
(2) The commission has the power and capacity of a natural person of full capacity.
(3) The Company Act does not apply to the commission, but the Lieutenant Governor in Council may order that one or more of the provisions of that Act apply.
(4) The commission is not liable to taxation, except insofar as the government is liable.
6 (1) The chair may establish one or more panels of the commission, and, in matters referred to a panel by the chair, a panel has the powers of the commission.
(2) The chair may refer a matter that is before the commission to a panel or a matter that is before a panel to the commission or another panel.
(3) A panel consists of 2 or more members of the commission appointed by the chair.
(4) The chair may terminate an appointment to a panel and may fill a vacancy on a panel before the commencement of a hearing.
7 (1) Subject to subsections (2) and (3), the commission may delegate its powers and duties under this Act or another enactment to the chair, a vice chair, a member of the commission or the executive director.
(2) The commission must not delegate a power or duty referred to in section 114 (1), 137, 142, 143, 145, 148 to 152, 157, 162, 163 or 165 to the executive director.
(3) The commission must not delegate the power to make rules under section 184.
(4) A member of the commission must not sit on any hearing required to be held by the commission with respect to any matter in relation to which the member exercised a power or performed a duty referred to in section 142, 143, 145 or 148 to 152 and which was delegated to the member under subsection (1).
8 (1) The commission must appoint a person to be the executive director.
(2) The executive director is the chief administrative officer of the commission and must obey the policy directives given by the commission.
(3) The executive director may exercise the powers and must perform the duties vested in or imposed on
(a) the executive director under this Act, and
(b) the commission under this Act that are delegated to the executive director by the commission.
(4) The executive director, by conditional or unconditional written authority, may delegate the executive director's powers and duties under this Act or another enactment to any person employed under section 9.
(5) Despite subsection (4), the executive director must not delegate
(a) powers or duties of the commission that are delegated to the executive director by the commission, or
(b) a power or duty referred to in section 81, 89, 161, 166 (3) or 182.
(6) A person to whom the executive director, by written authority under subsection (4), delegates powers and duties may exercise the powers and must perform the duties in accordance with the written authority.
(7) Persons employed in the office of the executive director as directors are deputies of the executive director.
9 The commission may
(a) appoint officers and employees of the commission necessary to enable the commission and the executive director to perform their duties and exercise their powers under this Act,
(b) define the duties of the officers and employees, and
(c) subject to the prior approval of the Treasury Board, determine the remuneration and classification of the officers and employees.
10 (1) The Public Service Benefit Plan Act applies to the commission and to the officers and employees.
(2) The Lieutenant Governor in Council may order that the Pension (Public Service) Act applies to a member of the commission who is named in the order, and in that case subsection (3) applies in respect of a member so named.
(3) The Pension (Public Service) Act applies to the officers and employees of the commission and
(a) the commission is deemed to be an employer and the officers and employees of the commission are deemed to be employees within the meaning of that Act,
(b) the commission must make deductions from the salaries of the officers and employees as required under that Act and pay the money to the superannuation commissioner under that Act, and
(c) the commission must, in addition, pay to the superannuation commissioner, employer's contributions in the amounts equivalent to the amounts required under that Act.
11 (1) Every person acting under the authority of this Act must keep confidential all facts, information and records obtained or provided under this Act or the regulations, or under a former enactment, except so far as the person's public duty requires or this Act permits the person to disclose them or to report or take official action on them.
(2) Subject to subsections (3) and (4), the facts, information and records referred to in subsection (1) must be released to the Ombudsman at the request of the Ombudsman.
(3) All facts, information and records that are obtained
(a) from a law enforcement agency, or
(b) pursuant to an investigation under this Act,
must only be released to the Ombudsman if the Ombudsman first produces the written consent of
(c) the law enforcement agency, or
(d) the person from whom the facts, information or records were obtained pursuant to the investigation,
to release the facts, information or records.
(4) All facts, information and records that could lead to the identification of an informant under this Act must only be released to the Ombudsman if the person to whom the Ombudsman makes the request first obtains the written consent of the informant to release the facts, information or records.
12 (1) The minister may establish a B.C. Securities Commission Securities Policy Advisory Committee consisting of members appointed by the minister.
(2) The purpose of the advisory committee is to provide to the commission advice on administrative, regulatory and legislative matters relating to trading in securities and to the securities industry.
13 (1) The commission may appoint an expert to assist it in any way it considers expedient.
(2) The commission may submit any record or thing for examination to an expert appointed under subsection (1), and the commission has the same power as is vested in an investigator under section 144 (1) and (2) to summon and enforce the attendance of witnesses before the expert and to compel them to give evidence under oath or in any other manner, and to produce records and things or classes of records and things.
(3) If an expert has made an examination or conducted an investigation under this section, the commission may require the person whose records or things were examined or investigated to pay prescribed fees or charges for the costs of the examination or investigation.
14 In this Part, "Minister of Finance and Corporate Relations" has the same meaning as in the Financial Administration Act.
15 (1) Revenue received under this Act, including but not limited to revenue
(a) from administrative penalties under section 162 and any cost recoveries under this Act, but not including revenue from fines referred to in section 155, or
(b) from any payments to the minister under an order referred to in section 157 (1) (b),
must be paid to the commission.
(2) Subject to subsection (3), money received by the commission may be expended for any costs involved in the administration and enforcement of this Act and for any costs involved in operating the commission.
(3) Money received by the commission as revenue from administrative penalties under section 162 of this Act may be expended only for the purpose of promoting knowledge of participants in the securities market of the legal, regulatory and ethical standards that govern the operation of the securities market in British Columbia.
(4) At the request of the commission, but subject to approval of the Treasury Board, the Minister of Finance and Corporate Relations may pay to the commission out of the consolidated revenue fund amounts not exceeding $5.5 million over the period ending March 31, 1998.
(5) This section applies despite section 12 of the Financial Administration Act.
16 The Lieutenant Governor in Council may designate administrative services that the commission must obtain from the government or from any government corporation, agency, branch, department or other government organization or entity that is specified in the order making the designation.
17 The Minister of Finance and Corporate Relations is the fiscal agent of the commission.
18 (1) The commission must place with the Minister of Finance and Corporate Relations, for investment, any money the commission receives but does not immediately require for carrying out the purposes of this Act.
(2) Money placed with the Minister of Finance and Corporate Relations under this section is to be treated for all purposes as money placed with that minister under section 40 (5) of the Financial Administration Act.
19 Subject to the approval of the Lieutenant Governor in Council and the Minister of Finance and Corporate Relations, the commission, for the purpose of carrying out any power, right, function or duty conferred or imposed on the commission under this or any other Act, may borrow the sums of money the commission considers necessary or advisable.
20 (1) The commission must establish and maintain accounting policies and systems satisfactory to the Minister of Finance and Corporate Relations.
(2) Whenever required by the Minister of Finance and Corporate Relations, the commission must render detailed accounts of the commission's revenues and expenditures for the period or to the day the Minister of Finance and Corporate Relations designates.
(3) All books or records of account and other financial records must at all times be open for inspection by the Minister of Finance and Corporate Relations or a person designated by that minister.
(4) The chair of the Treasury Board may direct the Comptroller General to examine and report to Treasury Board on any or all of the financial and accounting operations of the commission.
(5) At least once in every fiscal year, the accounts of the commission must be audited and reported on by an auditor appointed by the Lieutenant Governor in Council, and the costs of the audit must be paid by the commission.
(6) The fiscal year for the commission is a period of 12 months beginning on April 1 in each year and ending on March 31 in the next year.
21 At least once in every fiscal year of the commission and as directed by the Treasury Board, the commission must submit to the Treasury Board, for review and approval, a business plan that includes
(a) a proposed budget for the subsequent 3 fiscal years,
(b) management objectives for the next 3 years, and
(c) other information that the Treasury Board may specify.
22 (1) Within 90 days after the end of each fiscal year of the commission, the commission must prepare and submit to the minister a report for that fiscal year.
(2) The report must be laid before the Legislative Assembly by the minister as soon as practicable.
(3) The report must contain
(a) a summary of the commission's operations for the fiscal year of the report,
(b) a financial statement in the form required by the Minister of Finance and Corporate Relations showing the revenues, expenditures, assets and liabilities of the commission for the fiscal year of the report, and
(c) any other information that the minister may specify.
(4) The financial statement referred to in subsection (3) (b) must be prepared in accordance with generally accepted accounting principles.
23 A reference in sections 26 to 32 to a self regulatory body or an exchange is a reference to a self regulatory body or an exchange, as the case may be, that has been recognized by the commission under section 24.
24 (1) On the application of an association representing registrants, the commission may recognize the applicant as a self regulatory body.
(2) On application, the commission may recognize a person as an exchange in British Columbia.
25 A person must not carry on business as an exchange in British Columbia unless the person is recognized by the commission under section 24 (2).
26 (1) Subject to this Act, the regulations and any decision made by the commission, every self regulatory body and every exchange must regulate the standards of practice and business conduct of its members.
(2) A self regulatory body or exchange must provide to the commission or to the executive director, at the request of the commission or the executive director,
(a) a copy, or a partial copy as specified in the request, of the charter, as defined in section 1 of the Financial Institutions Act, of the self regulatory body or exchange, or
(b) any information or record in the possession of the self regulatory body or exchange relating to
(i) a registrant or former registrant,
(ii) a client or former client of a registrant or of a former registrant,
(iii) an issuer,
(iv) trading in securities or exchange contracts,
(v) any of the self regulatory body's or exchange's
(A) bylaws, rules, other regulatory instruments or policies, or
(B) directions, decisions, orders or rulings that are made under any of its bylaws, rules, other regulatory instruments or policies,
(vi) the charter, as defined in section 1 of the Financial Institutions Act, of the self regulatory body or exchange, or
(vii) this Act or the regulations.
27 (1) If the commission considers it to be in the public interest, the commission may make any decision respecting the following:
(a) a bylaw, rule or other regulatory instrument or policy, or a direction, decision, order or ruling made under a bylaw, rule or other regulatory instrument or policy, of a self regulatory body or exchange;
(b) the procedures or practices of a self regulatory body or exchange;
(c) the manner in which an exchange carries on business;
(d) the trading of securities or exchange contracts on or through the facilities of an exchange;
(e) an exchange contract trading on an exchange;
(f) a security listed and posted for trading on an exchange;
(g) issuers, whose securities are listed and posted for trading on an exchange, to ensure that they comply with this Act and the regulations.
(2) A person affected by a decision made by the commission under subsection (1) must act in accordance with the decision.
28 (1) The executive director or a person directly affected by a direction, decision, order or ruling made under a bylaw, rule or other regulatory instrument or policy of a self regulatory body or of an exchange may apply by notice to the commission for a hearing and review of the matter under Part 19, and section 165 (3) to (5) applies.
(2) An applicant under subsection (1), other than the executive director, must send a copy of the notice requesting a hearing and review to
(a) the executive director, and
(b) the affected self regulatory body or exchange.
(3) If the executive director is the applicant under subsection (1), the executive director must send a copy of the notice requesting a hearing and review to
(a) the affected self regulatory body or exchange, and
(b) the persons directly affected by the direction, decision, order or ruling referred to in subsection (1).
29 (1) The executive director may appoint in writing a person to review the business and conduct of a self regulatory body or exchange for the purpose of determining whether the self regulatory body or exchange is
(a) complying, or has complied, with
(i) this Act and the regulations,
(ii) any decision made under this Act or the regulations, or
(iii) the charter, as defined in section 1 of the Financial Institutions Act, of the self regulatory body or exchange, or
(b) enforcing or administering its bylaws, rules, other regulatory instruments or policies.
(2) On production of the appointment, a person conducting a review under this section may
(a) enter the business premises of a self regulatory body or exchange, during business hours,
(b) examine the records referred to in section 26 (2) (b),
(c) examine property, assets or things of the self regulatory body or exchange,
(d) make copies of the records referred to in section 26 (2) (b), and
(e) make inquiries of the self regulatory body or exchange, or persons employed by the self regulatory body or exchange, concerning the operations and procedures of the self regulatory body or exchange.
(3) In exercising the power to make copies under subsection (2) (d), the person conducting the review under this section may
(a) carry out the copying at the business premises of the self regulatory body or exchange, or
(b) on giving an appropriate receipt, remove records for the purpose of copying them at other premises specified in the receipt.
(4) Records removed under subsection (3) (b) for copying must be promptly returned to the person from which they were received.
(5) The executive director may require a self regulatory body or exchange that is the subject of a review under this section to pay prescribed fees or prescribed charges for the costs of the review.
(6) A person must not
(a) withhold, destroy, conceal or refuse to give any information, or
(b) withhold, destroy, conceal or refuse to produce any record or thing
reasonably required for a review under this section.
30 (1) An exchange must keep a record showing the time and date when each transaction on the exchange was recorded.
(2) If a client of a member of an exchange produces to the exchange a written confirmation of a transaction between the client and the member, the exchange must supply to the client
(a) particulars of the time at which the transaction was recorded, and
(b) verification or otherwise of the matters set out in the confirmation.
31 (1) An exchange must appoint an auditor.
(2) If the commission determines it is appropriate, a self-regulatory body must appoint an auditor.
(3) An auditor appointed under subsection (1) or (2) must
(a) be practising as an auditor in Canada, and
(b) first be approved by the commission.
32 (1) An exchange must appoint a panel of auditors from auditors who are practising as auditors in Canada.
(2) If the commission determines it is appropriate, a self regulatory body must appoint a panel of auditors from auditors who are practising as auditors in Canada.
(3) Each member of an exchange and a self regulatory body, as the case may be, must appoint an auditor from the panel appointed under subsection (1) or (2).
(4) An auditor appointed under subsection (3) must
(a) examine the financial affairs of the member
(i) as required by the bylaws, rules or other regulatory instruments or policies of the self regulatory body or exchange, and
(ii) in a manner satisfactory to the commission, and
(b) report on each examination to the self regulatory body or exchange, as the case may be.
(5) A bylaw, rule or regulatory instrument referred to in subsection (4) respecting the practice and procedure of examinations does not come into force until it has been approved by the commission.
33 (1) If the commission considers that to do so would not be prejudicial to the public interest, it may order that
(a) an exchange or self regulatory body, or
(b) a class of exchanges or regulatory bodies
is exempt from one or more of the requirements of this Part or of the regulations relating to this Part.
(2) An order under subsection (1) may be made on application by an interested person or on the commission's own motion.
34 (1) A person must not
(a) trade in a security or exchange contract unless the person is registered in accordance with the regulations as
(i) a dealer, or
(ii) a salesperson, partner, director or officer of a registered dealer and is acting on behalf of that dealer,
(b) act as an underwriter unless the person is registered in accordance with the regulations as an underwriter, or
(c) act as an adviser unless the person is registered in accordance with the regulations as
(i) an adviser, or
(ii) an advising employee, partner, director or officer of a registered adviser and is acting on behalf of that adviser.
(2) An application for registration or for renewal or reinstatement of registration or for an amendment to registration must be made to the executive director in the required form and must be accompanied by the prescribed fee.
(3) A person applying for registration under this section must not
(a) trade in a security or exchange contract,
(b) act as an underwriter, or
(c) act as an adviser
until the person has received written confirmation of the registration from the executive director.
35 (1) Subject to subsection (2), if an applicant
(a) is considered by the executive director to be suitable for registration in the capacity applied for, and
(b) pays the prescribed fee,
the executive director must grant the applicant registration or renewal or reinstatement of registration or an amendment to registration, as the case may be.
(2) If an applicant or partner, director or officer of an applicant is not a resident of British Columbia on the date of application, the executive director may refuse to register the applicant unless, at the time of application, the applicant meets the requirements of subsection (1) and, in addition, the applicant or the applicant's partner, director or officer
(a) is registered in a capacity corresponding to that of a dealer, underwriter, adviser, salesperson, advising employee, partner, director or officer under the law of the jurisdiction respecting trading in securities or exchange contracts, as the case may be, in which the applicant last resided, and
(b) has been so registered for at least one year immediately before the date of application.
(3) The executive director must not refuse to grant, renew, reinstate or amend a registration without giving the applicant an opportunity to be heard.
36 (1) The executive director may restrict a registration or a renewal or reinstatement of registration and may impose conditions of registration on the registrant and, without limiting these powers, may
(a) restrict the duration of the registration,
(b) restrict the registration to trades in specified securities or exchange contracts or a specified class of securities or class of exchange contracts, and
(c) direct that any or all of the registration exemptions described in sections 44 to 46 or any of the registration exemptions set out in the regulations do not apply to the registrant.
(2) The executive director acting under subsection (1) must not restrict a registration or impose a condition of registration on a registrant without giving the registrant or intended registrant an opportunity to be heard.
(3) A registrant must comply with a restriction or condition imposed
(a) under the regulations, or
(b) by the executive director under subsection (1).
37 A person may reapply for registration or for renewal of, reinstatement of or an amendment to registration if
(a) the person intends to use information not previously submitted, or
(b) material circumstances described in the person's previous application have changed.
38 The executive director may require
(a) within a specified time, further information or records to be submitted by an applicant,
(b) at any time, verification by affidavit or otherwise of any information or records submitted by an applicant, or
(c) an examination under oath, to be conducted by a person designated in writing by the executive director, of
(i) the applicant,
(ii) a partner, officer, director, governor or trustee of, or any person performing a similar function for, the applicant, or
(iii) an employee of the applicant.
39 (1) The executive director may appoint in writing a person to review the business and conduct of a registered dealer, underwriter or adviser, or of a former registrant in any of those categories, for the purpose of determining whether the registrant is complying, or has complied, or former registrant has complied while registered, with
(a) this Act and the regulations,
(b) any decision made under this Act or the regulations, or
(c) the bylaws, rules, other regulatory instruments or policies of the self regulatory body or exchange, if any, of which the registrant is a member.
(2) On production of the appointment, a person conducting a review under this section may
(a) enter the business premises of a registered dealer, underwriter or adviser, or of a former registrant in any of those categories, during business hours,
(b) examine the records of the registrant or of the former registrant that are required to be kept under this Act or the regulations,
(c) make copies of the records referred to in paragraph (b), and
(d) make inquiries of the registrant or the former registrant, or of persons employed by the registrant or former registrant, concerning the operations and procedures of the registrant or of the former registrant.
(3) In exercising the power to make copies under subsection (2) (c), the person conducting the review under this section may
(a) carry out the copying at the business premises of the registrant or former registrant, or
(b) on giving an appropriate receipt, remove records for the purpose of copying them at other premises specified in the receipt.
(4) Records removed under subsection (3) (b) for copying must be promptly returned to the person from which they were received.
(5) The executive director may require a registrant or former registrant that is the subject of a review under this section to pay prescribed fees or prescribed charges for the costs of the review.
(6) A person must not withhold, destroy, conceal or refuse to give any information, or produce any record or thing reasonably required for a review under this section.
40 If the employment of a salesperson with a registered dealer is terminated or suspended, the registration of the salesperson is immediately suspended until the executive director
(a) receives written notice of
(i) the reinstatement of employment of the salesperson from the registered dealer, or
(ii) the employment of the salesperson from another registered dealer, and
(b) approves the reinstatement of registration of the salesperson.
41 The executive director may accept the surrender of the registration of a person if the executive director is satisfied that
(a) the financial obligations of the person to the person's clients have been discharged, and
(b) the surrender of the registration is not prejudicial to the public interest.
42 (1) Subject to the regulations, a registered dealer must immediately file in the required form a notice of any of the following:
(a) the opening or closing of a branch office, in British Columbia, of the dealer;
(b) a change in the partners, directors or officers of the dealer and, in the case of termination of employment or of office by any means, the reason for termination;
(c) commencement or termination of the employment of a registered salesperson and, in the case of termination of employment by any means, the reason for termination;
(d) a change in
(i) the address for service in British Columbia of the dealer,
(ii) any business address of the dealer,
(iii) the holders of any of the voting securities issued by the dealer,
(iv) the name and address of the person in charge of any branch office, in British Columbia, of the dealer, or
(v) the name of the dealer or the name of any partner, director or officer of the dealer;
(e) a material change in other information previously filed, including
(i) a charge or indictment against, or a conviction of, the dealer or a partner, director or officer of the dealer for an offence under the law,
(ii) a finding, made against the dealer or a partner, director or officer of the dealer in a civil proceeding, of fraud, theft, deceit, misrepresentation or similar conduct,
(iii) bankruptcy of the dealer or a partner, director or officer of the dealer, or
(iv) the appointment of a receiver or receiver manager to hold the assets of the dealer or a partner, director or officer of the dealer.
(2) Subject to the regulations, a registered adviser or a registered underwriter must immediately file in the required form a notice of any of the following:
(a) a change in the partners, directors or officers of the adviser or underwriter and, in the case of termination of employment or of office by any means, the reason for termination;
(b) commencement or termination of the employment of a registered advising employee and, in the case of termination of employment by any means, the reason for termination;
(c) a change in
(i) the address for service in British Columbia of the adviser or underwriter,
(ii) any business address of the adviser or underwriter,
(iii) the holders of any of the voting securities issued by the adviser or underwriter, or
(iv) the name of the adviser or underwriter or the name of any partner, director or officer of the adviser or underwriter;
(d) a material change in other information previously filed, including
(i) a charge or indictment against, or a conviction of, the adviser or underwriter or a partner, director or officer of the adviser or underwriter for an offence under the law,
(ii) a finding, made against the adviser or underwriter or a partner, director or officer of the adviser or underwriter in a civil proceeding, of fraud, theft, deceit, misrepresentation or similar conduct,
(iii) bankruptcy of the adviser or underwriter or a partner, director or officer of the adviser or underwriter, or
(iv) the appointment of a receiver or receiver manager to hold the assets of the adviser or underwriter or a partner, director or officer of the adviser or underwriter.
(3) Subject to the regulations, a registered salesperson or a registered advising employee must immediately file in the required form a notice of any of the following:
(a) a change in
(i) the address for service in British Columbia of the salesperson or advising employee,
(ii) any business address of the salesperson or advising employee,
(iii) the employment of the salesperson by a registered dealer or of the advising employee by a registered adviser, or
(iv) the name of the salesperson or advising employee;
(b) a material change in other information previously filed, including
(i) a charge or indictment against, or a conviction of, the salesperson or advising employee for an offence under the law,
(ii) a finding, made against the salesperson or advising employee in a civil proceeding, of fraud, theft, deceit, misrepresentation or similar conduct,
(iii) bankruptcy of the salesperson or advising employee, or
(iv) the appointment of a receiver or receiver manager to hold the assets of the salesperson or advising employee.
(4) The executive director may require the person giving notice under this section to apply for an amendment of the person's registration.
(5) If the executive director considers that it is not prejudicial to the public interest, the executive director may exempt a registrant that is a reporting issuer from subsection (1) (d) (iii) or (2) (c) (iii).
(6) On any change in the name of a registrant, the registrant must
(a) promptly apply for a replacement certificate, and
(b) if the registrant is a dealer, underwriter or adviser, promptly apply for a replacement certificate for each individual registered to act on the registrant's behalf.
43 (1) For the purposes of this Part,
(a) a trust company or an insurer is deemed to be acting as principal when it purchases or sells as an agent or trustee for accounts that are fully managed by it, and
(b) a portfolio manager is deemed to be acting as principal when the portfolio manager purchases or sells as an agent for accounts that are fully managed by that portfolio manager.
(2) In this Part:
(a) "contract" and "policy" have the meanings defined in section 1 of the Insurance Act;
(b) "group insurance" has the meaning defined in section 29 of the Insurance Act;
(c) "life insurance" has the meaning defined in section 1 of the Financial Institutions Act.
44 (1) In this section, "accountant" means an individual who is a member in good standing, other than a student member, of a corporation having statutory authority to regulate its members in the practice of accountancy in British Columbia.
(2) Subject to subsection (3), the following persons may act as advisers without registration under section 34 (1) (c):
(a) an insurer or a savings institution;
(b) the Business Development Bank of Canada;
(c) a barrister and solicitor or an accountant;
(d) a registered dealer, with respect to research reports or similar analysis prepared by an employee of the dealer and distributed by the dealer;
(e) a registered dealer or a person that is registered under this Act as a partner, director, officer or salesperson of a registered dealer;
(f) a publisher of, or writer for, a newspaper, news magazine or business or financial publication, that is of general and regular paid circulation, distributed only to subscribers to it for value or to purchasers of it, if the publisher or writer
(i) gives advice as an adviser only through the newspaper, magazine or publication,
(ii) has no direct or indirect interest in any of the securities or exchange contracts in respect of which the person gives advice, and
(iii) receives no commission or other consideration for giving the advice other than for acting in the person's capacity as a publisher or writer;
(g) a person or class of persons designated by the regulations.
(3) Despite subsection (2), a person described in that subsection is not exempted from the requirement to register under section 34 (1) (c) as an adviser if,
(a) in the case of a person described in subsection (2) (a), (b), (c), (d) or (f), the person acts as an adviser where
(i) the advice the person gives is not solely incidental to the person's principal business contemplated by the relevant paragraph in subsection (2), or
(ii) if the person advertises its business, advising is featured in the advertisements, or
(b) in the case of a person described in subsection (2) (e), the advice the person gives is not reasonably in fulfillment of the person's duty to ensure the suitability of a proposed purchase or sale for a client.
45 (1) In this section, "issuer bid", "offeree issuer", "offeror" and "take over bid" have the meanings defined in section 92.
(2) Subject to the regulations, registration under section 34 (1) (a) is not required for the following trades in securities:
(1) a trade in a security by
(i) an executor, administrator, guardian or committee of an estate,
(ii) an authorized trustee or assignee, interim or official receiver or a custodian under the Bankruptcy Act (Canada),
(iii) a receiver under the Supreme Court Act,
(iv) a receiver, receiver manager or a liquidator under the Company Act, the Law and Equity Act, the Personal Property Security Act, the Business Corporations Act (Canada), the Winding-up Act (Canada) or this Act,
(v) a vendor conducting a judicial sale, or
(vi) a sheriff conducting a sale under the Court Order Enforcement Act,
in the person's official capacity;
(2) a trade where the person purchasing as principal, but not as underwriter, is
(i) the Business Development Bank of Canada,
(ii) a savings institution,
(iii) an insurer,
(iv) a subsidiary of a person referred to in subparagraphs (i) to (iii) if that person owns beneficially all of the voting securities of the subsidiary, except the voting securities required by law to be owned by directors of that subsidiary,
(v) the government of Canada or a province, or
(vi) a municipal corporation, public board or commission in Canada;
(3) a trade in a security by or on behalf of the owner, for the owner's account, or by or on behalf of the issuer of the security, for the issuer's account, if the trade is
(i) isolated,
(ii) not made in the course of continued and successive transactions of a similar nature, and
(iii) not made by a person whose usual business is trading in securities;
(4) a trade where the person
(i) purchases as principal,
(ii) is not an individual, and
(iii) is designated as an exempt purchaser in an order that the executive director may make for the purpose of this paragraph;
(5) a trade where
(i) the person purchases as principal, and
(ii) the trade is in a security that has an aggregate acquisition cost to the purchaser of not less than a prescribed amount;
(6) a trade by an issuer in a security of its own issue as consideration for part or all of another person's assets, so long as the fair value of the purchased assets is not less than a prescribed amount;
(7) a trade in a security by a person acting solely through a registered dealer;
(8) a trade by an issuer in
(i) a right granted by the issuer to holders of its securities to purchase additional securities of its own issue, or
(ii) a security of a reporting issuer held by the issuer and transferred or issued through the exercise of a right to purchase, convert or exchange previously granted by the issuer,
so long as the issuer gives the executive director written notice stating the date, amount, nature and conditions of the proposed trade, including the approximate net proceeds to be derived by the issuer on the basis of the additional securities being fully taken up and paid for, and the executive director
(iii) has not informed the issuer in writing within 10 days of the giving of the notice that the executive director objects to the trade, or
(iv) has withdrawn any objection the executive director has to the proposed trade;
(9) a trade in a security of
(i) an issuer (in this paragraph called the "first issuer") that is exchanged by or for the account of the first issuer with one or more of
(A) the first issuer's security holders,
(B) one or more other issuers (in this paragraph called the "other issuers"), and
(C) the security holders of the other issuers,
(ii) the first issuer by a holder of that security to one or more of the first issuer and the other issuers, or
(iii) any of the other issuers by the holder of that security to one or more of the first issuer and the other issuers
in connection with an amalgamation, merger, reorganization or arrangement if
(iv) an information circular in the required form, proxy statement or similar disclosure record in respect of the amalgamation, merger, reorganization or arrangement is prepared and delivered to each of the security holders whose approval of the amalgamation, merger, reorganization or arrangement is required under applicable legislation before it can proceed, and
(v) the amalgamation, merger, reorganization or arrangement is approved by the security holders referred to in subparagraph (iv) in accordance with the requirements of the applicable legislation;
(10) a trade by an issuer in a security of its own issue with
(i) its employee, senior officer or director or an employee, senior officer or director of an affiliate of the issuer so long as that person is not induced to purchase by expectation of employment or continued employment,
(ii) a trustee on behalf of a person referred to in subparagraph (i), or
(iii) an issuer all of the voting securities of which are beneficially owned by one or more of the persons referred to in subparagraph (i);
(11) a trade by an issuer in a security under a plan made available by that issuer to the holders of a class of publicly traded securities of the issuer, and which plan
(i) permits the holder to direct that dividends or interest paid in respect of securities of the issuer's own issue be applied to the purchase from the issuer of
(A) publicly traded securities of the issuer's own issue, or
(B) other securities of the issuer's own issue not referred to in clause (A) that are redeemable at the option of the holder, and
(ii) may include an option permitting a holder to purchase by cash payment securities of the issuer referred to in subparagraph (i) so long as the aggregate number of securities issued under the option in any financial year of the issuer does not exceed 2% of the outstanding securities of that class at the beginning of that financial year;
(12) a trade by an issuer in a security
(i) of its own issue that is distributed by it to its security holders as a stock dividend or other distribution out of earnings or surplus,
(ii) that is distributed by it to its security holders under a dissolution or winding up of the issuer, or
(iii) of its own issue transferred or issued through the exercise of a right
(A) of the holder to purchase, convert or exchange or otherwise acquire, or
(B) of the issuer to require the holder to purchase, convert or exchange,
in accordance with the terms and conditions of a previously issued security of the issuer,
so long as no commission or other remuneration is paid or given to others in respect of the trade except for administrative or professional services or for services performed by a registered dealer;
(13) a trade that is the transfer of beneficial ownership of a security to a transferee, pledgee, mortgagee or other encumbrancer under a realization on collateral given for a debt;
(14) a trade by an issuer in a security of a reporting issuer held by the issuer that is distributed by it to its security holders as a dividend in specie, so long as the issuer gives the executive director written notice stating the date, amount, nature and conditions of the proposed trade and the executive director
(i) has not informed the issuer in writing within 10 days of the giving of the notice that the executive director objects to the trade, or
(ii) has withdrawn any objection the executive director has to the proposed trade;
(15) a trade by an issuer in a security of its own issue if the trade is reasonably necessary to facilitate its incorporation or organization and the security is traded
(i) for a nominal consideration to not more than 5 incorporators or organizers, or
(ii) if the law under which the issuer is incorporated or organized requires the trade to be for a greater consideration or to a larger number of incorporators or organizers, for that greater consideration or to that larger number of incorporators or organizers;
(16) a trade by
(i) a person to an underwriter acting as purchaser, or
(ii) an underwriter to another underwriter;
(17) a trade by
(i) an issuer in a security of its own issue to a promoter of that issuer, or
(ii) a promoter of an issuer in a security issued by that issuer to another promoter of that issuer;
(18) a trade in a security of an issuer if each party to the trade is a control person of that issuer;
(19) a trade by or for the account of a lender, pledgee, mortgagee or other encumbrancer for the purpose of liquidating a genuine debt by selling or offering for sale a security pledged, mortgaged or otherwise encumbered as collateral for the debt;
(20) the execution of an order to purchase or sell through a registered dealer by a bank or a trust company as agent for a person and the trade by that person made by placing the order with the bank or trust company, so long as
(i) the order of the person to purchase or sell is unsolicited, and
(ii) the bank or trust company does not actively promote or market an order execution access service;
(21) a trade by an issuer in a security of its own issue as consideration for the acquisition of mining, petroleum or natural gas properties or any interest in them;
(22) a trade in a security of a mutual fund to a purchaser, other than the initial trade in a security of the mutual fund to that purchaser, if
(i) the initial trade in a security of the mutual fund to that purchaser was made under the exemption described in paragraph (5), and
(ii) either the net asset value or the aggregate acquisition cost, whichever is applicable, of the securities in the mutual fund held by the purchaser as at the date of the trade is not less than a prescribed amount;
(23) a trade made on or through the facilities of an exchange recognized by the commission for the purposes of this paragraph if
(i) the trade is effected in whole or part by means of telephone or other telecommunications equipment linking the facilities of that exchange with the facilities of another exchange recognized by the commission for the purposes of this paragraph, and
(ii) the purchase and sale is effected by or through persons each of whom is registered as a dealer, or in a similar capacity, under the law of a province;
(24) a trade in a security of an offeree issuer to an offeror under a take over bid or issuer bid;
(25) a trade to a holder of a security in a mutual fund under provisions in the instrument constituting the mutual fund that permit or require dividends or distributions of income or capital gains attributable to the securities to be reinvested in additional securities of the mutual fund of
(i) the same class of securities, or
(ii) of a class of securities having the same attributes as that class,
so long as no sales or other acquisition charges are levied;
(26) a trade by an issuer in a security of its own issue to a registered dealer or registered underwriter as consideration for services performed by the registered dealer or registered underwriter in connection with a distribution of securities of the issuer;
(27) a trade in a bond or debenture by way of an order given to a bank or trust company if
(i) the order to purchase or sell is unsolicited,
(ii) the bank or trust company is acting as principal, and
(iii) the bond or debenture is
(A) acquired by the bank or trust company from a registered dealer for purposes of the trade, or
(B) sold by the bank or trust company to a registered dealer following the trade;
(28) a trade in a security of an offeror that is exchanged by or for the account of the offeror with the security holders of an offeree issuer under a take over bid or issuer bid;
(29) a trade in a security to the issuer of the security pursuant to the purchase, redemption or acquisition of the security by the issuer;
(30) a trade designated by regulation or a trade within a class of trade designated by regulation.
(3) Subject to the regulations, for purposes of subsection (2) (8) or (14), the executive director must not object to the trade unless the executive director considers it to be in the public interest to do so.
(4) The executive director must not object to a trade referred to in subsection (2) (8) or (14) without giving the person who filed the written notice an opportunity to be heard.
46 Subject to the regulations, a person may trade in the following securities without being registered under section 34 (1) (a):
(a) bonds, debentures or other evidence of indebtedness
(i) of or guaranteed by the government of Canada or by a province of Canada,
(ii) of or guaranteed by
(A) a country, or
(B) a political division of a country
recognized in an order the commission may make for the purpose of this subparagraph,
(iii) of a municipal corporation in Canada, including debentures
(A) issued for public, separate, secondary or vocational school purposes,
(B) guaranteed by any municipal corporation in Canada, or
(C) secured by or payable out of rates or taxes levied under the law of a province on property in that province and collectible by or through the municipality where the property is situated,
(iv) of or guaranteed by an insurer or a savings institution, other than bonds, debentures or other evidence of indebtedness that are subordinate in right of payment to deposits held by the issuer or guarantor of those bonds, debentures or other evidence of indebtedness,
(v) of or guaranteed by the International Bank for Reconstruction and Development established by the Agreement for an International Bank for Reconstruction and Development approved by the Bretton Woods and Related Agreements Act (Canada), if the bonds, debentures or other evidences of indebtedness are payable in the currency of Canada or of the United States of America, or
(vi) of or guaranteed by the Asian Development Bank or the Inter-American Development Bank, if
(A) the bonds, debentures or other evidences of indebtedness are payable in the currency of Canada or of the United States of America, and
(B) with respect to those securities, the certificates, records or other information required by the commission are filed;
(b) certificates or receipts issued by a trust company or a credit union for money received for guaranteed investment;
(c) securities issued by a private mutual fund;
(d) negotiable promissory notes or commercial paper maturing not more than 12 months from the date of issue, so long as
(i) each note or commercial paper is not convertible or exchangeable into or accompanied by a right to purchase another security other than a security described in this section, and
(ii) the purchaser is not an individual;
(e) mortgages or other encumbrances on property that are
(i) not contained in or secured by a bond, debenture or similar obligation or in a trust deed or other instrument to secure bonds or debentures or similar obligations, and
(ii) offered for sale by a person who is registered or exempted from registration under the Mortgage Brokers Act;
(f) securities that
(i) evidence indebtedness due under a conditional sales contract or other title retention contract,
(ii) provide for the acquisition of personal property, and
(iii) are not offered for sale to an individual;
(g) securities issued by an issuer organized exclusively for educational, benevolent, fraternal, charitable, religious or recreational purposes and not for profit, if
(i) no part of the net earnings of the issuer accrue to the benefit of a security holder,
(ii) no commission or other remuneration is paid in connection with the sale of the securities,
(iii) in the case of a trade made by the issuer, an information statement in the required form is delivered to the purchaser before an agreement of purchase and sale is entered into, and
(iv) in the case of a trade made by the issuer, the information statement is filed not later than 10 days after the trade;
(h) securities issued by an association to which the Cooperative Association Act applies;
(i) shares or deposits of a credit union;
(j) securities of a private issuer if the securities are not offered for sale to the public;
(k) securities issued by a cooperative corporation, as defined in the Real Estate Act, for the purpose of evidencing a right to use or occupy a part of the land owned by the cooperative corporation where the securities cannot be dealt with apart from the right to use or occupy, so long as a prospectus or disclosure statement has been filed and accepted under the Real Estate Act;
(l) variable insurance contracts issued by an insurer if the variable insurance contract is
(i) a contract of group insurance,
(ii) a whole life insurance contract providing for the payment at maturity of an amount not less than 3/4 of the premium paid up to the age of 75 for a benefit payable at maturity,
(iii) an arrangement for the investment of policy dividends and policy proceeds in a separate and distinct fund to which contributions are made only from policy dividends and policy proceeds, or
(iv) a variable life annuity;
(m) securities designated by regulation or securities within a class of securities designated by regulation.
47 Subject to the regulations, registration under section 34 (1) is not required for the following trades in exchange contracts:
(a) a trade in an exchange contract by a person acting solely through a registered dealer;
(b) a trade resulting from an unsolicited order placed with an individual who is not a resident of and does not carry on business in British Columbia;
(c) a trade designated by regulation or a trade within a class of trades designated by regulation.
48 (1) If the commission or the executive director considers that to do so would not be prejudicial to the public interest, the commission or the executive director may order that
(a) a trade, intended trade, security, exchange contract or person, or
(b) a class of trades, intended trades, securities, exchange contracts or persons
is exempt from one or more of the requirements of Part 5 or the regulations related to Part 5.
(2) An order under subsection (1) may be made on application by an interested person or on the commission's or the executive director's own motion.
49 (1) In this section, "residence" includes a building or part of a building in which the occupant resides permanently or temporarily and any appurtenant premises.
(2) A person must not
(a) attend at any residence, or
(b) telephone from inside British Columbia to any residence inside or outside British Columbia
for the purpose of trading in a security or exchange contract.
(3) Subsection (2) does not apply if
(a) the person calls at or telephones the residence
(i) of a close personal friend, a business associate or a client with whom or on whose behalf the person calling or telephoning has been in the habit of trading in securities or exchange contracts, or
(ii) of a person who
(A) has received a copy of a prospectus filed under this Act, and
(B) has requested that information respecting a security offered in that prospectus be provided to that person by the person calling or telephoning,
and the person calling or telephoning refers only to the request for information respecting that security, or
(b) the person is making a trade in respect of which the person is exempted from registration under section 45 or 47 or is trading in a security in respect of which the person is exempted from registration under section 46.
(4) For purposes of this section, a person is conclusively deemed to have called or telephoned if a salesperson, advising employee, partner, director, officer or agent of the person calls or telephones on that person's behalf.
(5) The commission may exempt from subsection (2) a person or class of persons trading in
(a) securities or exchange contracts generally,
(b) a specific security or exchange contract, or
(c) class of securities or a class of exchange contracts.
50 (1) A person, while engaging in investor relations activities or with the intention of effecting a trade in a security, must not do any of the following:
(a) represent that the person or another person will
(i) resell or repurchase the security, or
(ii) refund all or any of the purchase price of the security;
(b) give an undertaking relating to the future value or price of the security;
(c) represent, without obtaining the prior written permission of the executive director,
(i) that the security will be listed and posted for trading on an exchange, or
(ii) that application has been or will be made to list and post the security for trading on an exchange;
(d) make a statement that the person knows, or ought reasonably to know, is a misrepresentation.
(2) Subsection (1) (a) does not apply to a representation
(a) in respect of a security that carries an obligation of the issuer to redeem or purchase, or a right of the owner to require redemption or purchase, or
(b) contained in a written agreement if the security involved has an aggregate acquisition cost in excess of a prescribed amount.
(3) A person, with the intention of effecting a trade in an exchange contract, must not do any of the following:
(a) represent that the person or another person will
(i) refund all or part of any margin put up or premium paid in respect of the exchange contract, or
(ii) assume all or part of the obligation under the exchange contract;
(b) give an undertaking relating to the future value of the exchange contract;
(c) make a statement that the person knows, or ought reasonably to know, is a misrepresentation.
51 (1) This section does not apply to a trade referred to in section 45 or a trade in a security described in section 46.
(2) If a registered dealer
(a) intends, as principal, to effect a trade in a security with a person who is not a registered dealer, and
(b) issues, publishes or sends a notice, circular, pamphlet, letter, advertisement, telegram or some other record to that person to effect that trade,
the registered dealer must not contract for the sale or purchase of the security unless, before contracting and before accepting payment or receiving any security or other consideration under or in anticipation of the contract, the registered dealer has stated in the record referred to in paragraph (b) that the registered dealer proposes to act as principal in the trade.
(3) A statement made in compliance with this section or the regulations that a registered dealer proposes to act or has acted as principal in respect of a trade in a security does not prevent that dealer from acting as agent in respect of a trade of that security.
52 (1) An issuer, or an issuer's security holder, who knows that a person is engaged in investor relations activities on behalf of the issuer or a security holder of the issuer must disclose to any person who inquires
(a) the fact of the engagement, and
(b) on whose behalf the person is engaged.
(2) A person engaged in investor relations activities, and an issuer or security holder on whose behalf investor relations activities are undertaken, must ensure that every record disseminated, as part of the investor relations activities, by the person engaged in those activities clearly and conspicuously discloses that the record is issued by or on behalf of the issuer or security holder.
53 A registrant must not use the name of another registrant on letterheads, forms, advertisements or signs, as correspondent or otherwise, unless the first registrant is a partner, officer or agent of, or is authorized in writing by, the other registrant.
54 (1) A person must not represent that the person is registered under this Act unless
(a) the representation is true, and
(b) in making the representation, the person specifies the person's category of registration under this Act and the regulations.
(2) A person who is not registered must not, directly or indirectly, hold himself, herself or itself out as being registered.
55 A person must not represent that the commission or the executive director has approved the financial standing, fitness or conduct of any registrant or passed on the merits of any security, exchange contract or issuer.
56 (1) A person who places an order for the sale of a security through a registered dealer acting on the person's behalf and who
(a) does not own the security, or
(b) if the person is acting as agent knows that the person's principal does not own the security,
must, at the time of placing the order to sell, declare to the registered dealer that the person or the person's principal, as the case may be, does not own the security, and that fact must be disclosed by the dealer in the written confirmation of sale.
(2) Subject to the regulations, for the purposes of subsection (1), a person does not own a security that
(a) has been borrowed by that person,
(b) is subject to any restriction on its sale, or
(c) may be acquired by that person on the exercise of a right to acquire the security by purchase, conversion, exchange or any other means.
57 A person must not, directly or indirectly, engage in or participate in a transaction or scheme relating to a trade in or acquisition of a security or a trade in an exchange contract if the person knows, or ought reasonably to know, that the transaction or scheme
(a) creates or results in a misleading appearance of trading activity in, or an artificial price for, any security listed, or exchange contract traded, on an exchange in British Columbia,
(b) perpetrates a fraud on any person in British Columbia, or
(c) perpetrates a fraud on any person anywhere in connection with
(i) the securities of a reporting issuer, or
(ii) trading in exchange contracts on an exchange in British Columbia.
58 (1) A person must not trade in an exchange contract on an exchange in British Columbia unless
(a) the exchange is recognized by the commission under section 24 (2), and
(b) the form of the exchange contract has been accepted by the commission.
(2) On application by an exchange in British Columbia, the commission by order may accept a form of exchange contract for the purpose of subsection (1) (b).
(3) The commission must not refuse to accept a form of exchange contract under subsection (2) without giving the applicant an opportunity to be heard.
59 (1) A registrant must not trade in an exchange contract on behalf of another person on an exchange outside British Columbia unless the exchange is recognized by the commission.
(2) On application by an exchange outside British Columbia or on the commission's own motion, the commission by order may recognize an exchange outside British Columbia for the purposes of subsection (1).
(3) The commission must not refuse to recognize an exchange under subsection (2) without giving the applicant an opportunity to be heard.
60 (1) If the commission or the executive director considers that to do so would not be prejudicial to the public interest, the commission or executive director may order that
(a) a trade, intended trade, exchange contract or person, or
(b) a class of trades, intended trades, exchange contracts or persons
is exempt from one or more of the requirements of this Part or the regulations relating to this Part.
(2) An order under subsection (1) may be made on application by an interested person or on the commission's or the executive director's own motion.
61 (1) Unless exempted under this Act or the regulations, a person must not distribute a security unless a preliminary prospectus and a prospectus respecting that security
(a) have been filed with the executive director, and
(b) receipts obtained for them from the executive director.
(2) A preliminary prospectus and a prospectus must be in the required form.
(3) A simplified preliminary prospectus and a simplified prospectus, each in the required form, may, if permitted by the regulations, be filed under this section.
62 A preliminary prospectus and a prospectus may be filed in accordance with this Part to enable the issuer to become a reporting issuer even though no distribution under that prospectus is contemplated.
63 (1) A prospectus must provide full, true and plain disclosure of all material facts relating to the securities issued or proposed to be distributed.
(2) A preliminary prospectus must substantially comply with the requirements of this Act and the regulations respecting the content of a prospectus.
(3) A prospectus, other than a prospectus filed under section 62, must contain statements that
(a) a purchaser has
(i) a right of withdrawal from an agreement of purchase and sale, and
(ii) if a prospectus contains a misrepresentation, a right of rescission or damages, and
(b) these rights must be exercised within limited time periods.
(4) In addition to the requirements of subsection (3), a prospectus of a mutual fund in British Columbia must contain a statement of the rights given to a purchaser under section 139.
64 (1) Before issuing a receipt for a preliminary prospectus or for a prospectus, the executive director may impose additional filing requirements and conditions if the executive director considers that it is in the public interest to do so.
(2) The executive director may accept a form of prospectus or preliminary prospectus that is in accordance with the law of another jurisdiction if it contains full, true and plain disclosure of all material facts relating to the security to be distributed.
65 (1) Subject to section 64 (1), the executive director must issue a receipt for a preliminary prospectus as soon as practicable after it has been filed under this Part.
(2) Subject to the regulations, the executive director must issue a receipt for a prospectus filed under this Part unless the executive director considers it to be prejudicial to the public interest to do so.
(3) The executive director must not refuse to issue a receipt for a prospectus without giving the person who filed the prospectus an opportunity to be heard.
66 (1) If an adverse material change occurs in the affairs of an issuer after a receipt is issued for a preliminary prospectus but before a receipt is issued for a prospectus, the person who intends to make the distribution must file an amendment to the preliminary prospectus disclosing the change, as soon as practicable and in any event no later than 10 days after the change occurs.
(2) An amendment to a preliminary prospectus may be filed under subsection (1) that discloses a material change other than an adverse material change.
(3) The executive director must issue, as soon as practicable, a receipt for an amendment to a preliminary prospectus filed under subsection (1).
(4) The person filing the amendment under subsection (1) must send the amendment, as soon as it has been filed, to each recipient of the preliminary prospectus according to the record maintained under section 80.
67 (1) If, after a receipt is issued for a prospectus but before the completion of the distribution under it, a material change occurs in the affairs of an issuer, the person who is making the distribution must file an amendment to the prospectus disclosing the change, as soon as practicable, and in any event no later than 10 days after the change occurs.
(2) If, after a receipt is issued for a prospectus but before the completion of the distribution under it, additional securities of the same class of securities previously disclosed in the prospectus are to be distributed, the person making the distribution must file an amendment to the prospectus disclosing the additional securities, as soon as practicable, and in any event no later than 10 days after the decision to increase the number of securities offered is made.
(3) If, after a receipt is issued for the prospectus but before the completion of the distribution under it, the terms or conditions of the offering disclosed in the prospectus are to be altered, the person making the distribution must file an amendment to the prospectus disclosing the change, as soon as practicable, and in any event no later than 10 days after the decision to alter the terms or conditions is made.
(4) The executive director must issue a receipt for an amendment to a prospectus filed under this section and section 65 (2) and (3) applies.
(5) Except with the written permission of the executive director, a distribution or an additional distribution must not proceed until a receipt for an amendment to a prospectus that is required to be filed under this section is issued by the executive director.
68 (1) The issuer must ensure that a prospectus contains a certificate that states the following, as applicable:
(a) if the prospectus is filed under section 61 or 71,
"The foregoing constitutes full, true and plain disclosure of all material facts relating to the securities offered by this prospectus as required by the Securities Act and its regulations.";
(b) if the prospectus is filed under section 62,
"The foregoing constitutes full, true and plain disclosure of all material facts relating to the securities previously issued by the issuer as required by the Securities Act and its regulations."
(2) Subject to subsections (3) to (5), the certificate required under subsection (1) must be signed
(a) by the issuer's chief executive officer and chief financial officer,
(b) on behalf of the directors of the issuer by any 2 directors, other than the persons referred to in paragraph (a), who are duly authorized to sign, and
(c) by each person who is a promoter of the issuer.
(3) If the issuer has only 3 directors, 2 of whom are the chief executive officer and the chief financial officer, the number of directors required to sign the certificate under subsection (2) (b) is one.
(4) If the executive director is satisfied on evidence or submissions made to the executive director that the chief executive officer or the chief financial officer of the issuer, or both, is not available to sign a certificate in a prospectus, the executive director may allow any other responsible officer of the issuer to sign it instead.
(5) The executive director may, with respect to the certificate required by subsection (1),
(a) exempt a promoter from signing it,
(b) allow a promoter's agent, who is duly authorized in writing, to sign it on behalf of the promoter, or
(c) on conditions the executive director imposes, require any person who has been a promoter of the issuer within the preceding 2 years to sign it.
69 (1) If an underwriter is in a contractual relationship with the issuer or holder of the securities offered by a prospectus, the prospectus must contain a certificate signed by the underwriter that states:
"To the best of our knowledge, information and belief, the foregoing constitutes full, true and plain disclosure of all material facts relating to the securities offered by this prospectus as required by the Securities Act and its regulations."
(2) The executive director may allow an underwriter's agent, who is duly authorized in writing, to sign the certificate required by subsection (1) on behalf of the underwriter.
70 (1) Subject to subsection (3), a person must not distribute a security under a prospectus after the lapse date of the prospectus.
(2) The lapse date of a prospectus is the earlier of
(a) the prescribed date, or
(b) a date designated by the executive director.
(3) A person may distribute a security under a prospectus after the lapse date of the prospectus on prescribed terms and conditions.
(4) A purchaser may, in prescribed circumstances, cancel a trade that was completed after the lapse date in reliance on subsection (3).
71 (1) A person who distributed securities under a prospectus filed under section 61 or this section may, on prescribed terms and conditions, continue to distribute securities under a new prospectus by
(a) filing the new prospectus with the executive director under this section, and
(b) obtaining a receipt for the new prospectus from the executive director under this section.
(2) Despite section 61 (1), a person may file a new prospectus under subsection (1) without filing a preliminary prospectus with and obtaining a receipt for the preliminary prospectus from the executive director.
(3) A short form of prospectus in the required form may, if permitted by the regulations, be filed under this section.
72 (1) If a person proposing to make a distribution of previously issued securities of an issuer is unable to obtain from the issuer information or material that is necessary to enable the person to comply with this Part or the regulations, the executive director may order the issuer to provide to that person the information and material that the executive director considers necessary.
(2) The information and material supplied under subsection (1) may be used by the person to whom it is provided for the purpose of complying with this Part and the regulations.
(3) If a person proposing to make a distribution of previously issued securities of an issuer is unable
(a) to obtain any or all of the signatures to the certificates required by this Part and the regulations, or
(b) to comply otherwise with this Part and the regulations,
the executive director may make an order exempting that person from any of the provisions of this Part or the regulations, on being satisfied that
(c) the person has made all reasonable efforts to comply, and
(d) no person is likely to be prejudicially affected by the failure to comply.
73 In this Part, "issuer bid", "offeree issuer", "offeror" and "take over bid" have the meanings defined in section 92.
74 (1) In this section,
(a) a trust company or an insurer is deemed to be acting as principal when it purchases or sells as an agent or trustee for accounts that are fully managed by it, and
(b) a portfolio manager is deemed to be acting as principal when the portfolio manager purchases or sells as an agent for accounts that are fully managed by the portfolio manager.
(2) Subject to the regulations, section 61 does not apply to a distribution in the following circumstances:
(1) the purchaser of the security is
(i) the Business Development Bank of Canada,
(ii) a savings institution,
(iii) an insurer,
(iv) a subsidiary of a person referred to in subparagraphs (i) to (iii), if that person owns beneficially all of the voting securities of the subsidiary, except the voting securities required by law to be owned by directors of that subsidiary,
(v) the government of Canada or a province, or
(vi) a municipal corporation, public board or commission in Canada,
who purchases as principal;
(2) the trade is made by or on behalf of an issuer in a specific security of its own issue for the issuer's account and is
(i) isolated,
(ii) not made in the course of continued and successive transactions of a similar nature, and
(iii) not made by a person whose usual business is trading in securities,
(3) the person
(i) is purchasing as principal,
(ii) is not an individual, and
(iii) is designated as an exempt purchaser in an order that the executive director may make for the purpose of this paragraph;
(4) the person is purchasing as principal, and the trade is in a security that has an aggregate acquisition cost to the purchaser of not less than a prescribed amount;
(5) the trade is made by an issuer in a security of its own issue as consideration for part or all of another person's assets, so long as the fair value of the purchased assets is not less than a prescribed amount;
(6) the trade is made from one registered dealer to another registered dealer where the registered dealer making the purchase is acting as principal;
(7) the trade is made by an issuer in
(i) a right granted by the issuer to holders of its securities to purchase additional securities of its own issue, or
(ii) a security of a reporting issuer held by the issuer and transferred or issued through the exercise of a right to purchase, convert or exchange previously granted by the issuer,
so long as the issuer gives the executive director written notice stating the date, amount, nature and conditions of the proposed trade, including the approximate net proceeds to be derived by the issuer on the basis of the additional securities being fully taken up and paid for, and the executive director
(iii) has not informed the issuer in writing within 10 days of the giving of the notice that the executive director objects to the trade, or
(iv) has withdrawn any objections the executive director has to the proposed trade;
(8) a trade in a security of
(i) an issuer (in this paragraph called the "first issuer") that is exchanged by or for the account of the first issuer with one or more of
(A) the first issuer's security holders,
(B) one or more other issuers (in this paragraph called the "other issuers"), and
(C) the security holders of the other issuers,
(ii) the first issuer by a holder of that security to one or more of the first issuer and the other issuers, or
(iii) any of the other issuers by the holder of that security to one or more of the first issuer and the other issuers
in connection with an amalgamation, merger, reorganization or arrangement if
(iv) an information circular in the required form, proxy statement or similar disclosure record in respect of the amalgamation, merger, reorganization or arrangement is prepared and delivered to each of the security holders whose approval of the amalgamation, merger, reorganization or arrangement is required under applicable legislation before it can proceed, and
(v) the amalgamation, merger, reorganization or arrangement is approved by the security holders referred to in subparagraph (iv) in accordance with the requirements of the applicable legislation;
(9) a trade is made by an issuer in a security of its own issue with
(i) its employee, senior officer or director or an employee, senior officer or director of an affiliate of the issuer, so long as that person is not induced to purchase by expectation of employment or continued employment,
(ii) a trustee on behalf of a person referred to in subparagraph (i), or
(iii) an issuer all of the voting securities of which are beneficially owned by one or more of the persons referred to in subparagraph (i);
(10) the trade is made by an issuer in a security under a plan made available by that issuer to the holders of a class of publicly traded securities of the issuer, and which plan
(i) permits the holder to direct that dividends or interest paid in respect of securities of the issuer's own issue be applied to the purchase from the issuer of
(A) publicly traded securities of the issuer's own issue, or
(B) other securities of the issuer's own issue not referred to in clause (A) that are redeemable at the option of the holder, and
(ii) may include an option permitting a holder to purchase by cash payment securities of the issuer referred to in subparagraph (i), so long as the aggregate number of securities issued under the option in any financial year of the issuer does not exceed 2% of the outstanding securities of that class at the beginning of that financial year;
(11) the trade is made by an issuer in a security
(i) of its own issue that is distributed by it to its security holders as a stock dividend or other distribution out of earnings or surplus,
(ii) that is distributed by it to its security holders under a dissolution or winding up of the issuer, or
(iii) of its own issue that is transferred or issued through the exercise of a right
(A) of the holder to purchase, convert or exchange or otherwise acquire, or
(B) of the issuer to require the holder to purchase, convert or exchange,
in accordance with the terms and conditions of a previously issued security of the issuer,
so long as no commission or other remuneration is paid or given to others in respect of the trade except for administrative or professional services or for services performed by a registered dealer;
(12) the trade is the transfer of beneficial ownership of a security to a transferee, pledgee, mortgagee or other encumbrancer under a realization on collateral given for a debt;
(13) the trade is made by an issuer in a security of a reporting issuer held by the issuer that is distributed by it to its security holders as a dividend in specie, so long as the issuer gives the executive director written notice stating the date, amount, nature and conditions of the proposed trade and the executive director
(i) has not informed the issuer in writing within 10 days of the giving of the notice that the executive director objects to the trade, or
(ii) has withdrawn any objection the executive director has to the proposed trade;
(14) the trade is made by an issuer in a security of its own issue, if the trade is reasonably necessary to facilitate its incorporation or organization and the security is traded
(i) for a nominal consideration to not more than 5 incorporators or organizers, or
(ii) if the law under which the issuer is incorporated or organized requires the trade to be for a greater consideration or to a larger number of incorporators or organizers, for that greater consideration or to that larger number of incorporators or organizers;
(15) the trade is made by
(i) a person to an underwriter acting as purchaser, or
(ii) an underwriter to another underwriter;
(16) the trade is made by
(i) an issuer in a security of its own issue to a promoter of that issuer, or
(ii) a promoter of an issuer in a security issued by that issuer to another promoter of that issuer;
(17) the trade is in the security of an issuer, if each party to the trade is a control person of that issuer;
(18) the trade is made by an issuer in a security of its own issue as consideration for the acquisition of mining, petroleum or natural gas properties or any interest in them;
(19) the trade is in a security of a mutual fund to a purchaser, other than the initial trade in a security of the mutual fund to that purchaser, if
(i) the initial trade in a security of the mutual fund to that purchaser was made under the exemption described in paragraph (4), and
(ii) either the net asset value or the aggregate acquisition cost, whichever is applicable, of the securities in the mutual fund held by the purchaser as at the date of the trade is not less than a prescribed amount;
(20) the trade is made on or through the facilities of an exchange recognized by the commission for the purposes of this paragraph if
(i) the trade is effected in whole or part by means of telephone or other telecommunications equipment linking the facilities of that exchange with the facilities of another exchange recognized by the commission for the purposes of this paragraph, and
(ii) the purchase and sale is effected by or through persons each of whom is registered as a dealer, or in a similar capacity, under the law of a province;
(21) the trade is made in a security of an offeree issuer to an offeror under a take over bid or issuer bid;
(22) the trade is made to a holder of a security in a mutual fund under provisions in the instrument constituting the mutual fund that permit or require dividends or distributions of income or capital gains attributable to the securities to be reinvested in additional securities of the mutual fund of
(i) the same class of securities, or
(ii) of a class of securities having the same attributes as that class,
so long as no sales or other acquisition charges are levied;
(23) a trade by an issuer in a security of its own issue to a registered dealer or registered underwriter as consideration for services performed by the registered dealer or registered underwriter in connection with a distribution of securities of the issuer;
(24) the trade is made in a security of an offeror that is exchanged by or for the account of the offeror with the security holders of an offeree issuer under a take over bid that under section 98 (1) (a), (b), (e) or (f) is exempted from sections 105 to 110;
(25) the trade is made in a security of an offeror that is exchanged by or for the account of the offeror with the security holders of an offeree issuer under a take over bid that under section 98 (1) (c) or (d) is exempted from sections 105 to 110;
(26) the trade is made in a security of an offeror under a take over bid or an issuer bid where a securities exchange take over bid circular or securities exchange issuer bid circular in respect of the security was filed by the offeror;
(27) the trade is made in a security to the issuer of the security pursuant to the purchase, redemption or acquisition of the security by the issuer;
(28) the trade is designated by regulation or the trade is within a class of trade designated by regulation.
(3) Subject to the regulations, for purposes of subsection (2) (7) or (13), the executive director must not object to the trade unless the executive director considers it in the public interest to do so.
(4) The executive director must not object to a trade referred to in subsection (2) (7) or (13) without giving the person who filed the written notice an opportunity to be heard.
75 Section 61 does not apply to
(a) a distribution of a security described in section 46 (a) to (l), or
(b) a distribution consisting of options to sell or purchase securities known as "puts" and "calls" which permit the holder of the option to sell or purchase from the writer of the option a specified amount of securities at a specific price, on or before a specified date or the occurrence of a specified event, so long as
(i) the option has been written by or the performance under the option is guaranteed by a member of an exchange recognized by the commission for this purpose,
(ii) the securities that are the subject of the option are listed and posted for trading on an exchange recognized by the commission for this purpose, and
(iii) the option is in the required form.
76 (1) If the commission or the executive director considers that to do so would not be prejudicial to the public interest, the commission or the executive director may order that
(a) a trade, intended trade, security or person or class of trades, intended trades, securities or persons is exempt from one or more of the requirements of Part 9 or the regulations related to Part 9, and
(b) a trade or intended trade or class of trades or intended trades is deemed to be a distribution.
(2) An order under subsection (1) may be made on application by an interested person or on the commission's or the executive director's own motion.
(3) On application of an interested person, the commission or the executive director may determine whether the distribution of a security has been concluded or is currently in progress.
77 (1) On application, the executive director may issue a certificate that an issuer is a reporting issuer.
(2) The commission must maintain a list of defaulting reporting issuers for public inspection during normal business hours in the commission's offices.
(3) On application, the executive director may issue a certificate that a reporting issuer is not in default of
(a) filing financial statements required by this Act or the regulations, or
(b) paying prescribed fees and charges.
(4) A person
(a) may rely on a certificate issued under subsection (1) to determine that an issuer is a reporting issuer, and
(b) subject to subsection (5), may rely on the list maintained under subsection (2) or a certificate issued under subsection (3) to determine that a reporting issuer is not in default of filing financial statements required by this Act or the regulations or paying prescribed fees and charges.
(5) Subsection (4) (b) does not apply to a person that knows or reasonably ought to know that a reporting issuer that is not named in the list maintained under subsection (2) or that is named in a certificate issued under subsection (3), as the case may be, is in default of filing financial statements required by this Act or the regulations or paying prescribed fees and charges.
78 (1) In this section, "waiting period" means the interval between the issue of a receipt by the executive director for a preliminary prospectus and the issue of a receipt by the executive director for the prospectus in respect of the same distribution.
(2) Despite section 61, but subject to Part 7, during the waiting period for the distribution of a security, a dealer or the issuer of the security may
(a) communicate with a person
(i) identifying the security proposed to be distributed,
(ii) stating the price of the security, if determined,
(iii) stating the name and address of a person from whom purchases of the security may be made, and
(iv) stating further information permitted or required by the regulations,
so long as the dealer or issuer states the name and address of a person from whom a preliminary prospectus may be obtained,
(b) give out a preliminary prospectus, and
(c) solicit expressions of interest from a prospective purchaser, so long as before the solicitation, or as soon as practicable after the prospective purchaser indicates an interest in purchasing the security, a copy of the preliminary prospectus is sent to the prospective purchaser.
79 If a dealer or an issuer takes any action under section 78, the dealer or issuer must send a copy of the preliminary prospectus to each person who, without solicitation, indicates an interest in purchasing the security and requests a copy of the preliminary prospectus.
80 If a dealer or an issuer takes any action under section 78, the dealer or issuer must maintain a record of the names and addresses of all persons to whom the preliminary prospectus has been sent.
81 If the executive director considers that a preliminary prospectus does not substantially comply with section 63 (1), the executive director may, without giving notice, order that trading that is permitted by section 78 (2) in the security to which the preliminary prospectus relates cease until a revised preliminary prospectus satisfactory to the executive director is filed and sent to each recipient of the defective preliminary prospectus according to the record maintained in section 80.
82 From the date of issue of a receipt for a prospectus relating to a security, a person distributing the security may give out
(a) the prospectus,
(b) any record filed with or referred to in the prospectus, and
(c) any record used in section 78 (2) (a).
83 (1) A dealer, not acting as agent of the purchaser, who receives an order or subscription for a security offered in a distribution to which section 61 applies must send to the purchaser,
(a) before entering into the written confirmation of the agreement of purchase and sale resulting from the order or subscription, or
(b) not later than midnight on the second business day after entering into the agreement,
the latest prospectus filed or required to be filed, with respect to the security, and any amendment to that prospectus, filed or required to be filed, under this Act.
(2) Despite subsection (1), a dealer is not required to send an amendment to a prospectus to a purchaser if the agreement of purchase and sale of the security has been entered into before the obligation to file the amendment arises under section 67.
(3) An agreement of purchase and sale referred to in subsection (1) is not binding on the purchaser if the dealer from whom the purchaser purchases the security receives, not later than 2 business days after receipt by the purchaser of the latest prospectus, and any amendment to the prospectus, that the purchaser is entitled to receive under this Act, written notice sent by the purchaser, evidencing the intention of the purchaser not to be bound by the agreement.
(4) Subsection (3) does not apply if the purchaser
(a) is a registrant, or
(b) disposes of the beneficial ownership of the security referred to in subsection (3), otherwise than to secure indebtedness, before the end of the time referred to in subsection (3).
(5) For the purposes of this section, subject to subsection (7), receipt of the latest prospectus, and any amendment to the prospectus, that the purchaser is entitled to receive under this Act, by a dealer who
(a) is acting as agent of the purchaser, or
(b) after receipt begins to act as agent of the purchaser,
with respect to the purchase of a security referred to in subsection (1), is deemed to be receipt by the purchaser on the date on which the dealer received the prospectus and any amendment to that prospectus.
(6) For the purposes of this section, receipt of the notice referred to in subsection (3) by a dealer who acted as agent of the seller with respect to the sale of the security referred to in subsection (1) is deemed to be receipt by the seller on the date on which the dealer received the notice.
(7) For the purposes of this section, a dealer does not act as agent of the purchaser unless the dealer is acting solely as agent of the purchaser with respect to the sale in question and has not received and has no agreement to receive compensation from or on behalf of the seller with respect to that sale.
(8) The onus of proving that the time for giving notice under subsection (3) has ended is on the dealer from whom the purchaser has agreed to purchase the security.
(9) If the issuer acts as the issuer's own dealer in respect of a trade, this section applies to the issuer as if the issuer were a dealer.
84 (1) If the commission or the executive director considers that to do so would not be prejudicial to the public interest, the commission or the executive director may order that a person or class of persons is exempt from one or more of the requirements of this Part or of the regulations relating to this Part.
(2) An order under subsection (1) may be made on application by an interested person or on the commission's or the executive director's own motion.
85 (1) If a material change occurs in the affairs of a reporting issuer, the reporting issuer must
(a) as soon as practicable issue and file a press release that is authorized by a senior officer and that discloses the nature and substance of the change, and
(b) file a required report, as soon as practicable, but in any event no later than 10 days after the date on which the change occurs.
(2) Subsection (1) does not apply to a reporting issuer that immediately files the report required under subsection (1) (b) marked "confidential" together with written reasons why there should not be a press release under subsection (1) (a), so long as
(a) in the opinion of the reporting issuer, the disclosure required by subsection (1) would be unduly detrimental to its interests, or
(b) the material change in the affairs of the reporting issuer
(i) consists of a decision to implement a change made by senior management of the issuer who believe that confirmation of the decision by the directors is probable, and
(ii) senior management of the issuer has no reason to believe that persons with knowledge of the material change have made use of that knowledge in purchasing or selling securities of the issuer.
(3) If a report has been filed under subsection (2), the reporting issuer must advise the commission in writing, within 10 days of the date of filing the initial report and every 10 days after that, that it believes the report should continue to remain confidential until
(a) the material change is generally disclosed in the manner referred to in subsection (1) (a), or
(b) if the material change consists of a decision of the type referred to in subsection (2) (b), that decision has been rejected by the directors of the issuer.
86 (1) A person that
(a) is in a special relationship with a reporting issuer, and
(b) knows of a material fact or material change with respect to that reporting issuer, which material fact or material change has not been generally disclosed,
must not purchase or sell
(c) securities of that reporting issuer,
(d) a put, a call, an option or another right or obligation to purchase or sell securities of the reporting issuer, or
(e) a security, the market price of which varies materially with the market price of any securities of the reporting issuer.
(2) A reporting issuer or a person in a special relationship with a reporting issuer must not inform another person of a material fact or material change with respect to the reporting issuer before the material fact or material change has been generally disclosed, unless giving the information is necessary in the course of business of the reporting issuer or of the person in the special relationship with the reporting issuer.
(3) A person who proposes to
(a) make a take over bid, as defined in section 92, for the securities of a reporting issuer,
(b) become a party to a reorganization, amalgamation, merger, arrangement or similar business combination with a reporting issuer, or
(c) acquire a substantial portion of the property of a reporting issuer
must not inform another person of a material fact or material change with respect to the reporting issuer before the material fact or material change has been generally disclosed, unless giving the information is necessary to effect the take over bid, business combination or acquisition, as the case may be.
(4) A person does not contravene subsection (1), (2) or (3) if the person proves on the balance of probabilities that, at the time of the purchase or sale referred to in subsection (1) or at the time of giving the information under subsection (2) or (3), as the case may be, the person reasonably believed that the material fact or material change had been generally disclosed.
87 (1) In this section, "reporting issuer" does not include a mutual fund.
(2) A person who is an insider of a reporting issuer must, within 10 days of becoming an insider, file an insider report in the required form effective the date on which the person became an insider, disclosing any direct or indirect beneficial ownership of, or control or direction over, securities of the reporting issuer.
(3) If a person who is an insider of a reporting issuer does not have any direct or indirect beneficial ownership of, or control or direction over, securities of the reporting issuer, the person is not required to file a report under subsection (2) merely to state that fact.
(4) If
(a) a person has filed or is required to file an insider report under subsection (2) or under a former enactment, and
(b) the person's direct or indirect beneficial ownership of, or control or direction over, securities of the reporting issuer changes from that shown or required to be shown in the latest insider report filed by the person,
the person must, within 10 days after the end of the month in which the change takes place, file an insider report in the required form disclosing
(c) the person's direct or indirect beneficial ownership of, or control or direction over, securities of the reporting issuer at the end of that month, and
(d) the change or changes in the person's ownership in securities of the reporting issuer that occurred during the month,
so long as the person was an insider of the reporting issuer at any time during that month.
(5) If a director or senior officer
(a) of an issuer is deemed under section 2 (2) to have been an insider of a reporting issuer, or
(b) of a reporting issuer is deemed under section 2 (3) to have been an insider of another reporting issuer,
then, within 10 days after the date on which that deeming occurs, the director or senior officer must file the insider reports referred to in subsections (2) and (4), for the period for which the director or senior officer is deemed to have been an insider.
(6) For the purpose of reporting under this section,
(a) ownership passes when
(i) an offer to sell is accepted by the purchaser or the purchaser's agent, or
(ii) an offer to buy is accepted by the seller or the seller's agent, and
(b) a security or class of securities, including a put, call option or other right or obligation to purchase or sell securities of a reporting issuer, must be reported as prescribed in the regulations.
88 If the commission considers that it would not be prejudicial to the public interest to do so, it may, on the application of a reporting issuer, order that the reporting issuer is deemed to have ceased to be a reporting issuer.
89 (1) If
(a) the commission or the executive director
(i) considers that there are unexplained and unusual fluctuations in the volume of trading in, or market price of, a security or exchange contract,
(ii) becomes aware of information, other than information filed under this Act, that when disclosed to the public may cause or is likely to cause unusual fluctuations in the volume of trading in, or market price of, a security or exchange contract,
(iii) considers that there may have been a material change in the business or operations of an issuer that, when disclosed, could significantly affect the market price of a security issued by it, or
(iv) considers that circumstances exist or are about to occur that could result in other than an orderly trading of a security or exchange contract, and
(b) the commission or the executive director considers it to be in the public interest,
the commission or executive director may, without a hearing, order that all trading in that security or exchange contract be halted for a specified period not longer than 3 business days.
(2) Notice of every order made under subsection (1) must be sent immediately to the issuer whose securities are affected by it.
(3) If
(a) a security affected by an order made under subsection (1) is listed and posted for trading on an exchange in British Columbia, or
(b) an exchange contract affected by an order made under subsection (1) is traded on an exchange in British Columbia,
the commission or executive director must immediately send written notice of the order to the exchange, and the order becomes effective, for all purposes and in respect of all persons, as soon as the exchange receives the notice.
90 The commission or the executive director may require the directors, officers, promoters or control persons of an issuer or a class of issuers, within the time the commission or executive director specifies, to file personal information in the required form.
91 (1) The commission or the executive director may order that a person or class of persons is exempt from one or more of the requirements of this Part or the regulations related to this Part if
(a) the requirement in respect of which an exemption is to be granted conflicts with a similar requirement of the law of the jurisdiction in which the reporting issuer is incorporated, organized or continued, or
(b) the commission or the executive director considers that to do so would not be prejudicial to the public interest.
(2) An order under subsection (1) may be made on application by an interested person or on the commission's or the executive director's own motion.
92 (1) In this Part:
"equity security" means any security of an issuer that carries a residual right to participate in the earnings of the issuer and, on the liquidation or winding up of the issuer, in its assets;
"formal bid" means
(a) a take over bid or an issuer bid to which section 105 applies, or
(b) a take over bid that is exempted from sections 105 to 110 or an issuer bid that is exempted from sections 105 to 108 and 110
(i) by reason of an exemption under section 98 (1) (a) or 99 (e), if the offeror is required to deliver to every holder in British Columbia of securities subject to the bid a disclosure document of the type contemplated by section 132 (12), or
(ii) by reason of an exemption under section 98 (1) (e) or 99 (h), if the offeror is required to deliver disclosure material relating to the bid to holders of the class of securities subject to the bid;
"issuer bid" means an offer to acquire or redeem securities of an issuer made by the issuer to any person who is in British Columbia or to any holder in British Columbia of securities of the issuer and includes a purchase, redemption or other acquisition of securities of the issuer by the issuer from any such person, but does not include an offer to acquire or redeem debt securities that are not convertible into securities other than debt securities;
"offer to acquire" includes
(a) an offer to purchase, or a solicitation of an offer to sell, securities, or
(b) an acceptance of an offer to sell securities, whether or not such offer to sell has been solicited,
or any combination thereof, and the person accepting an offer to sell is deemed to be making an offer to acquire to the person that made the offer to sell;
"offeree issuer" means an issuer whose securities are the subject of a take over bid, an issuer bid or an offer to acquire;
"offeror" means a person who makes a take over bid, issuer bid or offer to acquire and, for the purposes of section 111, includes a person who acquires a security, whether or not by way of a take over bid, issuer bid or offer to acquire;
"offeror's securities" means securities of an offeree issuer beneficially owned, or over which control or direction is exercised, on the date of an offer to acquire, by an offeror or any person acting jointly or in concert with the offeror;
"published market" means, as to any class of securities, any market on which the securities are traded, if the prices at which they have been traded on that market are regularly published in a newspaper or business or financial publication of general and regular paid circulation;
"take over bid" means an offer to acquire outstanding voting or equity securities of a class made to any person who is in British Columbia or to any holder in British Columbia of securities subject to the offer to acquire, if the securities subject to the offer to acquire, together with the offeror's securities, constitute in aggregate 20% or more of the outstanding securities of that class of securities at the date of the offer to acquire.
(2) In sections 114 and 115, "interested person" means
(a) an offeree issuer,
(b) a security holder, director or officer of an offeree issuer,
(c) an offeror,
(d) the executive director, and
(e) any person not referred to in paragraphs (a) to (d) who, in the opinion of the commission or the Supreme Court, as the case may be, is a proper person to make an application under section 114 or 115.
93 For the purposes of this Part,
(a) a period of days is to be computed as
(i) beginning on the day next following the event that began the period, and
(ii) ending at midnight on the last day of the period,
except that if the last day of the period does not fall on a business day, the period ends at midnight on the next business day, and
(b) a take over bid or an issuer bid expires at the later of
(i) the end of the period, including any extension, during which securities may be deposited pursuant to the bid, and
(ii) the time at which the offeror becomes obligated by the terms of the bid to take up or reject securities deposited under the bid.
94 For the purposes of this Part,
(a) a security is deemed to be convertible into a security of another class
(i) if, whether or not on conditions, it is or may be convertible into or exchangeable for a security of the other class, whether of the same or another issuer, or
(ii) if it carries the right or obligation to acquire a security of the other class, whether of the same or another issuer, and
(b) a security that is convertible into a security of another class is deemed to be convertible into a security or securities of each class into which the second mentioned security may be converted, either directly or through securities of one or more other classes of securities that are themselves convertible.
95 (1) For the purposes of this Part, in determining the beneficial ownership of securities of an offeror or of any person acting jointly or in concert with the offeror, at any given date, the offeror or the person is deemed to have acquired and be the beneficial owner of a security, including an unissued security, if the offeror or the person
(a) is the beneficial owner of any security convertible within 60 days following such date into the security, or
(b) has the right or obligation, whether or not on conditions, to acquire within 60 days following such date beneficial ownership of the security, whether through the exercise of an option, warrant, right or subscription privilege or otherwise.
(2) If 2 or more offerors acting jointly or in concert make one or more offers to acquire securities of a class, the securities subject to any such offer or offers to acquire are deemed to be securities subject to the offer to acquire of each such offeror for the purpose of determining whether any such offeror is making a take over bid.
(3) If an offeror or any person acting jointly or in concert with the offeror is deemed by subsection (1) to be the beneficial owner of unissued securities, the securities are deemed to be outstanding for the purpose of calculating the number of outstanding securities of that class in respect of that offeror's offer to acquire.
96 (1) For the purposes of this Part, it is a question of fact as to whether a person is acting jointly or in concert with an offeror and, without limiting the generality of this, the following are presumed to be acting jointly or in concert with an offeror:
(a) every person who, as a result of any agreement, commitment or understanding, whether formal or informal, with the offeror or with any other person acting jointly or in concert with the offeror, acquires or offers to acquire securities of the issuer of the same class as those subject to the offer to acquire;
(b) every person who, as a result of any agreement, commitment or understanding, whether formal or informal, with the offeror or with any other person acting jointly or in concert with the offeror, intends to exercise jointly or in concert with the offeror or with any other person acting jointly or in concert with the offeror any voting rights attaching to any securities of the offeree issuer;
(c) every associate or affiliate of the offeror.
(2) Despite subsection (1), a registered dealer acting solely in an agency capacity for the offeror in connection with a take over bid or an issuer bid and not executing principal transactions for the registered dealer's own account in the class of securities subject to the offer to acquire or performing services beyond customary dealer's functions is not to be presumed solely by reason of such agency relationship to be acting jointly or in concert with the offeror in connection with the bid.
97 For the purposes of this Part, a reference to an offer to acquire or to the acquisition or ownership of securities or to control or direction over securities is to be construed to include a direct or indirect offer to acquire or the direct or indirect acquisition or ownership of securities, or the direct or indirect control or direction over securities, as the case may be.
98 (1) Subject to the regulations, a take over bid is exempt from sections 105 to 110 if any of the following apply:
(a) the bid is made through the facilities of an exchange recognized by the commission for the purposes of this paragraph;
(b) the bid meets all the following conditions:
(i) the bid is for not more than 5% of the outstanding securities of a class of securities of the issuer;
(ii) the aggregate number of securities acquired by the offeror and any person acting jointly or in concert with the offeror within any period of 12 months in reliance on the exemption provided by this paragraph does not, when aggregated with acquisitions otherwise made by the offeror and any person acting jointly or in concert with the offeror within the same 12 month period, constitute in excess of 5% of the outstanding securities of that class of the issuer at the beginning of the 12 month period;
(iii) if there is a published market for the securities acquired, the value of the consideration paid for any of the securities acquired is not in excess of the market price at the date of acquisition, determined in accordance with the regulations, plus reasonable brokerage fees or commissions actually paid;
(c) the bid meets all of the following conditions:
(i) purchases are made from not more than 5 persons in aggregate, including persons outside British Columbia;
(ii) the bid is not made generally to security holders of the class of securities that is the subject of the bid;
(iii) the value of the consideration paid for any of the securities, including brokerage fees or commissions, is not greater than 115% of the market price of securities of that class at the date of the bid, determined in accordance with the regulations;
(d) the bid meets all the following conditions:
(i) the offeree issuer is not a reporting issuer;
(ii) there is not a published market in respect of the securities that are the subject of the bid;
(iii) the number of holders of securities of that class is not more than 50, exclusive of holders who
(A) are in the employment of the offeree issuer or an affiliate of the offeree issuer, or
(B) were formerly in the employment of the offeree issuer or an affiliate of the offeree issuer and who while in that employment were, and have continued after that employment to be, security holders of the offeree issuer;
(e) the bid meets all of the following conditions:
(i) the number of holders in British Columbia of securities of the class subject to the bid is fewer than 50;
(ii) the securities held by such holders constitute, in aggregate, less than 2% of the outstanding securities of that class;
(iii) the bid is made in compliance with the laws of a jurisdiction that is recognized for the purposes of this subparagraph by the commission;
(iv) all material relating to the bid that is sent by the offeror to holders of securities of the class that is subject to the bid is concurrently sent to all holders in British Columbia of such securities and is filed;
(f) the bid is exempted by the regulations.
(2) For the purposes of subsection (1) (c),
(a) if an offeror makes an offer to acquire securities from a person and the offeror knows or ought to know after reasonable enquiry that one or more other persons on whose behalf that person is acting as nominee, agent, trustee, executor, administrator or other legal representative has a direct beneficial interest in those securities, then each of such others are to be included in the determination of the number of persons to whom the offer to acquire has been made, but if
(i) an inter vivos trust has been established by a single settlor, or
(ii) an estate has not vested in all persons beneficially entitled to it,
the trust or estate is to be considered a single security holder in such determination, or
(b) if an offeror makes an offer to acquire securities from a person and the offeror knows or ought to know after reasonable enquiry that the person acquired the securities in order that the offeror might make use of the exemption provided by subsection (1) (c), then each person from whom those securities were acquired are to be included in the determination of the number of persons to whom the offer to acquire has been made.
99 Subject to the regulations, an issuer bid is exempt from sections 105 to 108 and 110 if any of the following apply:
(a) the securities are purchased, redeemed or otherwise acquired in accordance with terms and conditions attaching to them that permit the purchase, redemption or acquisition of the securities by the issuer without the prior agreement of the owners of the securities, or if the securities are acquired to meet sinking fund or purchase fund requirements;
(b) the purchase, redemption or other acquisition is required by the instrument creating or governing the class of securities or by the statute under which the issuer was incorporated, organized or continued;
(c) the securities carry with them or are accompanied by a right of the owner of the securities to require the issuer to redeem or repurchase the securities and the securities are acquired pursuant to the exercise of the right;
(d) the securities are acquired from a current or former employee of the issuer or of an affiliate of the issuer, and if there is a published market in respect of the securities,
(i) the value of the consideration paid for any of the securities acquired is not greater than the market price of the securities at the date of the acquisition, determined in accordance with the regulations, and
(ii) the aggregate number or, in the case of convertible debt securities, the aggregate principal amount of securities acquired by the issuer within a period of 12 months in reliance on the exemption provided by this paragraph is not greater than 5% of the securities of that class issued and outstanding at the beginning of the period;
(e) the bid is made through the facilities of an exchange recognized by the commission for the purpose of this paragraph;
(f) following the publication of a notice of intention in the required form and in the manner prescribed by the regulations, the issuer purchases securities in the normal course in the open market, including through the facilities of an exchange, if the aggregate number, or, in the case of convertible debt securities, the aggregate principal amount, of securities acquired by the issuer within a period of 12 months in reliance on the exemption provided by this paragraph is not greater than 5% of the securities of that class issued and outstanding at the beginning of the period;
(g) the bid meets all the following conditions:
(i) the issuer is not a reporting issuer;
(ii) there is not a published market in respect of the securities that are the subject of the bid;
(iii) the number of holders of securities of the issuer is not more than 50, exclusive of holders who
(A) are in the employment of the issuer or an affiliate of the issuer, or
(B) were formerly in the employment of the issuer or an affiliate of the issuer and who while in that employment were, and have continued after the employment to be, security holders of the issuer;
(h) the bid meets all of the following conditions:
(i) the number of holders in British Columbia of securities of the class subject to the bid is fewer than 50;
(ii) the securities held by such holders constitute, in aggregate, less than 2% of the outstanding securities of that class;
(iii) the bid is made in compliance with the laws of a jurisdiction that is recognized for the purposes of this subparagraph by the commission;
(iv) all material relating to the bid that is sent by the offeror to holders of securities of the class that is subject to the bid is concurrently sent to all holders in British Columbia of such securities and is filed;
(i) the bid is exempted by the regulations.
100 A bid that is made in reliance on any exemption in section 98 or 99 through the facilities of an exchange must be made in accordance with the bylaws, rules and other regulatory instruments or policies of the exchange.
101 (1) In this Division, "offeror" means
(a) an offeror making a formal bid other than a bid referred to in section 98 (1) (e) or 99 (h),
(b) a person acting jointly or in concert with an offeror referred to in paragraph (a), or
(c) a control person of an offeror referred to in paragraph (a) or an associate or affiliate of such control person.
(2) An offeror must not offer to acquire or make, or enter into, an agreement, commitment or understanding to acquire beneficial ownership of any securities of the class that are subject to a take over bid otherwise than pursuant to the bid on and from the day of the announcement of the offeror's intention to make the bid until its expiry.
(3) Despite subsection (2), an offeror making a take over bid may purchase, through the facilities of an exchange recognized by the commission for the purpose of section 98 (1) (a), securities of the class that are subject to the bid and securities convertible into securities of that class beginning on the third business day following the date of the bid until the expiry of the bid if
(a) the intention to make such purchases is stated in the take over bid circular,
(b) the aggregate number of securities acquired under this subsection does not constitute in excess of 5% of the outstanding securities of that class as at the date of the bid, and
(c) the offeror issues and files a press release immediately after the close of business of the exchange on each day on which securities have been purchased under this subsection disclosing the information prescribed by the regulations.
102 An offeror making an issuer bid must not offer to acquire, or make or enter into any agreement, commitment or understanding to acquire, beneficial ownership of any securities of the class that are subject to the bid otherwise than pursuant to the bid on and from the day of the announcement of the offeror's intention to make the bid until the bid's expiry, but this section does not apply so as to prevent the offeror from purchasing, redeeming or otherwise acquiring any such securities during such period in reliance on an exemption under section 99 (a), (b) or (c).
103 (1) If a take over bid that is a formal bid is made by an offeror and, within the period of 90 days immediately preceding the bid, the offeror acquired beneficial ownership of securities of the class subject to the bid pursuant to a transaction not generally available on identical terms to holders of that class of securities,
(a) the offeror must offer
(i) consideration for securities deposited under the bid at least equal to and in the same form as the highest consideration that was paid on a per security basis under any of such prior transactions, or
(ii) at least the cash equivalent of such consideration, and
(b) the offeror must offer to acquire under the bid that percentage of securities of the class subject to the bid that is at least equal to the highest percentage that the number of securities acquired from a seller in such a prior transaction was of the total number of securities of that class beneficially owned by such seller at the time of the prior transaction.
(2) During the period beginning with the expiry of a take over bid that is a formal bid and ending at the end of the 20th business day after that, whether or not any securities are taken up under the bid, an offeror must not acquire beneficial ownership of securities of the class that was subject to the bid except by way of a transaction that is generally available to holders of that class of securities on terms identical to those under the bid.
(3) Subsections (1) and (2) do not apply to trades effected in the normal course on a published market, so long as
(a) any broker acting for the purchaser or seller does not perform services beyond the customary broker's function and does not receive more than reasonable fees or commissions,
(b) the purchaser or any person acting for the purchaser does not solicit or arrange for the solicitation of offers to sell securities of the class subject to the bid, and
(c) the seller or any person acting for the seller does not solicit or arrange for the solicitation of offers to buy securities of the class subject to the bid.
104 (1) Except pursuant to a bid, an offeror must not sell or make or enter into any agreement, commitment or understanding to sell any securities of the class subject to the bid on and from the day of the announcement of the offeror's intention to make the bid until its expiry.
(2) Despite subsection (1), an offeror may, before the expiry of a bid, make or enter into an arrangement, commitment or understanding to sell securities that may be taken up by the offeror pursuant to the bid, after the expiry of the bid, if the intention to sell is disclosed in the take over bid circular or issuer bid circular, as the case may be.
105 Subject to the regulations, the following requirements apply to every take over bid and issuer bid:
(a) Delivery of bid. — The bid must be made to all holders of securities of the class that is subject to the bid who are in British Columbia, and delivered by the offeror to all holders in British Columbia of securities of that class and of securities that, before the expiry of the bid, are convertible into securities of that class;
(b) Minimum deposit period. — The offeror must allow securities to be deposited pursuant to the bid for at least the prescribed period;
(c) When taking up prohibited. — Securities deposited pursuant to the bid must not be taken up by the offeror until the expiration of the prescribed period;
(d) Withdrawal. — Securities deposited pursuant to the bid may be withdrawn by or on behalf of a depositing security holder,
(i) at any time before the expiration of the prescribed period from the date of the bid,
(ii) at any time before the expiration of the prescribed period from the date of a notice of change or variation under section 108, and
(iii) if the securities have not been taken up and paid for by the offeror, after the expiry of the prescribed period;
(e) Exception. — The right of withdrawal conferred by paragraph (d) (ii) does not apply
(i) if the securities have been taken up by the offeror at the date of the notice,
(ii) if a variation in the terms of a bid consists solely of an increase in the consideration offered for the securities subject to the bid and the time for deposit is not extended for a period greater than that required by section 108 (5), or
(iii) in the circumstances described in section 108 (6);
(f) Notice of withdrawal. — Notice of withdrawal of any securities under paragraph (d) must be made by or on behalf of the depositing security holder by a method that provides the depository designated under the bid with a written or printed copy and, to be effective, the notice must be actually received by the depository and, if notice is given in accordance with this paragraph, the offeror must return the securities to the depositing security holder;
(g) Pro rata take up. — If the bid is made for less than all of the class of securities subject to the bid and if a greater number of securities is deposited pursuant to the bid than the offeror is bound or willing to acquire under the bid, the securities must be taken up and paid for by the offeror, as nearly as may be pro rata, disregarding fractions, according to the number of securities deposited by each depositing security holder;
(h) Effect of market purchases. — If an offeror purchases securities as permitted by section 101 (3), the securities so purchased must be counted in the determination of whether a condition as to the minimum number of securities to be deposited in the bid has been fulfilled, but must not reduce the number of securities the offeror is bound under the bid to take up;
(i) When securities must be taken up and paid for. — Subject to paragraphs (j) and (k), the offeror must take up and pay for securities deposited under the bid, if all the terms and conditions of the bid have been complied with or waived, not later than the prescribed period after the expiry of the bid;
(j) Further regarding when securities must be taken up and paid for. — Any securities that are taken up by the offeror under the bid must be paid for by the offeror as soon as possible, and in any event not more than 3 days, after the taking up of the securities;
(k) Further regarding when securities must be taken up and paid for. — Any securities deposited pursuant to the bid subsequent to the date on which the offeror first takes up securities deposited under the bid must be taken up and paid for by the offeror within 10 days of the deposit of the securities;
(l) Extension restricted. — A bid may not be extended by the offeror, if all the terms and conditions of the bid have been complied with except those waived by the offeror, unless the offeror first takes up and pays for all securities deposited under the bid and not withdrawn;
(m) Press release. — If all the terms and conditions of the bid have been complied with or waived, the offeror must immediately issue a notice by press release to that effect, which press release must disclose the approximate number of securities deposited and the approximate number that will be taken up.
106 If a take over bid or issuer bid provides that the consideration for the securities deposited pursuant to the bid is to be paid in cash or partly in cash, the offeror must make adequate arrangements before the bid to ensure that the required funds are available to make full payment for all securities that the offeror has offered to acquire.
107 (1) Subject to the regulations, if a take over bid or issuer bid is made, all holders of the same class of securities must be offered identical consideration.
(2) If an offeror makes or intends to make a take over bid or issuer bid, the offeror or any person acting jointly or in concert with the offeror must not enter into any collateral agreement, commitment or understanding with any holder or beneficial owner of securities of the offeree issuer that has the effect of providing to the holder or owner a consideration of greater value than that offered to the other holders of the same class of securities.
(3) If a variation in the terms of the take over bid or issuer bid before the expiry of the bid increases the value of the consideration offered for the securities subject to the bid, the offeror must pay that increased consideration to each person whose securities are taken up pursuant to the bid, whether or not the securities were taken up by the offeror before the variation.
108 (1) An offeror must deliver, with or as part of a take over bid or issuer bid, a take over bid circular or issuer bid circular, as the case may be.
(2) If, before the expiry of a take over bid or issuer bid or after the expiry of the bid but before the expiry of all rights to withdraw the relevant securities, a change has occurred in the information contained in a take over bid circular or issuer bid circular or in any notice of change or notice of variation that would reasonably be expected to affect the decision of the holders of the securities of the offeree issuer to accept or reject the bid, a notice of the change must be delivered to every person to whom the circular was required to be delivered and whose securities were not taken up at the date of the occurrence of the change.
(3) Subsection (2) does not apply to a change that is not within the control of the offeror or of an affiliate of the offeror unless it is a change in a material fact relating to the securities being offered in exchange for securities of the offeree issuer.
(4) If there is a variation in the terms of a take over bid or issuer bid, including any extension of the period during which securities may be deposited under the bid, and whether or not the variation results from the exercise of any right contained in the bid, a notice of the variation must be delivered to every person to whom the take over bid circular or issuer bid circular was required to be delivered and whose securities were not taken up at the date of the variation.
(5) Subject to subsection (6), if there is a variation in the terms of a take over bid or issuer bid, the period during which securities may be deposited pursuant to the bid must not expire before the prescribed period after the notice of variation has been delivered.
(6) Subsection (5) does not apply to a variation in the terms of a bid consisting solely of the waiver of a condition in the bid where the consideration offered for the securities that are subject to the bid consists solely of cash.
(7) A take over bid circular and an issuer bid circular must be in the required form.
(8) A notice of change and a notice of variation must contain the information required by this Part and the regulations.
109 (1) If a take over bid has been made, a directors' circular must be prepared and delivered by the board of directors of an offeree issuer to every person to whom a take over bid must be delivered under section 105 (a), not later than the prescribed period after the date of the bid.
(2) The board of directors must include in a directors' circular either
(a) a recommendation to accept or to reject a take over bid and the reasons for their recommendation, or
(b) a statement that they are unable to make or are not making a recommendation and, if no recommendation is made, the reasons for not making a recommendation.
(3) An individual director or officer may recommend acceptance or rejection of a take over bid if the director or officer delivers with the recommendation a circular prepared in accordance with the regulations.
(4) If a board of directors is considering recommending acceptance or rejection of a take over bid, it
(a) must, at the time of sending or delivering a directors' circular, advise the security holders of this fact, and
(b) may advise them not to tender their securities until further communication is received from the directors.
(5) If subsection (4) applies, the board of directors must deliver the recommendation or the decision not to make a recommendation at least the prescribed number of days before the scheduled expiry of the period during which securities may be deposited under the bid.
(6) If, before the expiry of a take over bid or after the expiry of the bid but before the expiry of all rights to withdraw the securities that have been deposited under the bid,
(a) a change has occurred in the information contained in a directors' circular or in any notice of change to a directors' circular that would reasonably be expected to affect the decision of the holders of the securities to accept or reject the bid, the board of directors of the offeree issuer must immediately deliver a notice of the change to every person to whom the circular was required to be sent disclosing the nature and substance of the change, or
(b) a change has occurred in the information contained in an individual director's or officer's circular or any notice of change to it that would reasonably be expected to affect the decision of the holders of the securities to accept or reject the bid, other than a change that is not within the control of the individual director or officer, as the case may be, that individual director or officer must immediately deliver a notice of change in relation to it to the board of directors.
(7) If an individual director or officer submits a circular under subsection (3) or a notice of change under subsection (6) (b) to the board of directors, the board, at the offeree issuer's expense, must deliver a copy of the circular or notice to the persons referred to in subsection (1).
(8) A directors' circular and a director's or officer's circular must be in the required form.
(9) A notice of change must contain the information required by this Part and the regulations.
110 (1) A take over bid and any notice of change or variation must be filed and must be delivered to the offeree issuer at the principal office of the offeree issuer and an issuer bid and any notice of change or variation must be filed on the day such bid or notice is delivered to holders of securities of the offeree issuer, or as soon as practicable after that.
(2) Every directors' circular and every individual director's or officer's circular or any notice of change in relation to it that is delivered to security holders of an offeree issuer must be filed and must be delivered to the offeror at the principal office of the offeror on the day the directors' circular or individual director's or officer's circular or the notice of change is delivered to the holders of securities of the offeree issuer, or as soon as practicable after that.
(3) A take over bid or issuer bid, a take over bid circular, an issuer bid circular, a directors' circular, an individual director's or officer's circular and every notice of change or variation in any such bid or circular must be
(a) mailed by prepaid first class mail to the intended recipient, or
(b) delivered to the intended recipient by personal delivery or in such other manner as the executive director may approve.
(4) Any bid, circular or notice mailed or delivered in accordance with subsection (3) is deemed to have been delivered and is deemed conclusively for the purposes of sections 105, 108 and 109 and this section to have been dated as of the date on which it was mailed or delivered in accordance with subsection (3) to all or substantially all of the persons entitled to receive it.
111 (1) Every offeror that, except pursuant to a formal bid, acquires beneficial ownership of, or the power to exercise control or direction over, or securities convertible into, voting or equity securities of any class of a reporting issuer that, together with such offeror's securities of that class, would constitute 10% or more of the outstanding securities of that class,
(a) must immediately issue and file a press release containing the information prescribed by the regulations, and
(b) must, within 2 business days, file a report containing the same information as is contained in the press release issued under paragraph (a).
(2) If an offeror is required to file a report under subsection (1) or a further report under this subsection and the offeror or any person acting jointly or in concert with the offeror acquires beneficial ownership of, or the power to exercise control or direction over, or securities convertible into, an additional 2% or more of the outstanding securities of the class or there is a change in any other material fact in such a report, the offeror,
(a) must immediately issue and file a press release containing the information prescribed by the regulations, and
(b) must, within 2 business days, file a report containing the same information as is contained in the press release issued under paragraph (a).
(3) During the period beginning on the occurrence of an event in respect of which a report or further report is required to be filed under this section and ending on the expiry of one business day after the date that the report or further report is filed, the offeror or any person acting jointly or in concert with the offeror must not acquire or offer to acquire beneficial ownership of any securities of the class in respect of which the report or further report is required to be filed or any securities convertible into securities of that class.
(4) Subsection (3) does not apply to an offeror that is the beneficial owner of, or has the power to exercise control or direction over, securities that, together with such offeror's securities of that class, constitute 20% or more of the outstanding securities of that class.
112 (1) If, after a formal bid has been made for voting or equity securities of an offeree issuer that is a reporting issuer and before the expiry of the bid, an offeror, other than the person making the bid, acquires beneficial ownership of, or the power to exercise control or direction over, securities of the class subject to the bid which, when added to such offeror's securities of that class, constitute 5% or more of the outstanding securities of that class, the offeror must
(a) not later than the opening of trading on the next business day, issue a press release containing the information prescribed by the regulations, and
(b) immediately file a copy of the press release.
(2) If an offeror that has filed or is required to file a press release under subsection (1) or a further press release under this subsection or any person acting jointly or in concert with the offeror acquires beneficial ownership of, or control or direction over, securities of the class subject to the bid which, when added to the securities of that class acquired after the filing of the press release by the offeror and any person acting jointly or in concert with the offeror, aggregates an additional 2% or more of the class of outstanding securities, the offeror must
(a) not later than the opening of trading on the next business day, issue a further press release containing the information prescribed by the regulations, and
(b) immediately file a copy of the press release.
113 If the facts required to be reported or in respect of which a press release is required to be filed under sections 111 and 112 are identical, a report or press release is required only under the provision requiring the earlier report or press release, as the case may be.
114 (1) If the commission considers that a person has not complied or is not complying with this Part or the regulations related to this Part, the commission may make an order,
(a) restraining the distribution of any record used or issued in connection with a take over bid or issuer bid,
(b) requiring an amendment to or variation of any record used or issued in connection with a take over bid or issuer bid and requiring the distribution of any amended, varied or corrected record, and
(c) directing any person to comply with this Part or the regulations related to this Part or restraining any person from contravening this Part or the regulations related to this Part and directing the directors and senior officers of the person to cause the person to comply with or to cease contravening this Part or the regulations related to this Part.
(2) If the commission considers that to do so would not be prejudicial to the public interest, the commission may
(a) decide for the purposes of section 107 (2)
(i) that an agreement, commitment or understanding with a selling security holder is made for reasons other than to increase the value of the consideration paid to the selling security holder for the securities of the selling security holder, and
(ii) that the agreement, commitment or understanding may be entered into despite that subsection,
(b) vary any time period set out in this Part and the regulations related to this Part, and
(c) order that a person or class of persons is exempt from one or more of the requirements of this Part or the regulations related to this Part.
(3) An order under subsection (1) or (2) may be made on application by an interested person or on the commission's own motion.
115 (1) An interested person may apply to the Supreme Court for an order under this section.
(2) On an application under subsection (1), if the Supreme Court is satisfied that a person has not complied with this Part or the regulations related to this Part, the Supreme Court may make such interim or final order as the Supreme Court thinks fit including, without limiting the generality of this,
(a) an order compensating any interested person who is a party to the application for damages suffered as a result of a contravention of this Part or the regulations related to this Part,
(b) an order rescinding a transaction with any interested person, including the issue of a security or a purchase and sale of a security,
(c) an order requiring any person to dispose of any securities acquired pursuant to or in connection with a take over bid or an issuer bid,
(d) an order prohibiting any person from exercising any or all of the voting rights attaching to any securities, and
(e) an order requiring the trial of an issue.
116 In this Part:
"form of proxy" means a written or printed form that, on completion and execution by or on behalf of a security holder, becomes a proxy;
"proxy" means a completed and executed form of proxy by which a security holder has appointed a person as the security holder's nominee to attend and act for the security holder and on the security holder's behalf at a meeting of security holders;
"security holder" means a holder in British Columbia of a voting security of a reporting issuer;
"solicit" includes
(a) a request for a proxy, whether or not it is accompanied by or included in a form of proxy,
(b) a request to execute or not to execute a form of proxy or to revoke a proxy,
(c) the sending of a form of proxy or other communication to a security holder under circumstances reasonably calculated to result in the procurement, withholding or revocation of a proxy of that security holder, or
(d) the sending, along with a notice of a meeting, of a form of proxy to a security holder by management of a reporting issuer,
but does not include
(e) the sending of a form of proxy to a security holder in response to an unsolicited request made by the security holder or on behalf of the security holder, or
(f) the performance by any person of ministerial acts or professional services on behalf of a person soliciting a proxy.
117 (1) If the management of a reporting issuer gives or intends to give notice of a meeting to its security holders, the management must, in accordance with the regulations, at the same time as or before giving that notice, send to each security holder who is entitled to notice of the meeting a required form of proxy for use at the meeting.
(2) A person must not solicit proxies from security holders unless,
(a) in the case of a solicitation by or on behalf of the management of a reporting issuer, the management sends to each security holder whose proxy is solicited an information circular in the required form as an appendix to the notice of the meeting or as a separate document accompanying the notice, or
(b) in the case of any other solicitation, the person soliciting the proxies, concurrently with or before the solicitation, sends an information circular in the required form to each security holder whose proxy is solicited.
(3) Subsection (2) does not apply to a solicitation
(a) if the total number of security holders whose proxies are solicited is not more than 15, unless the solicitation is made by or on behalf of the management of a reporting issuer,
(b) prescribed by regulation, or
(c) by a person in respect of securities of which the person is the beneficial owner.
(4) For the purposes of subsection (3) (a), 2 or more persons who are joint registered owners of one or more securities are to be considered one security holder.
118 (1) The chair at a meeting has the right not to conduct a vote by way of ballot on a matter if the form of proxy used at the meeting provides for a means by which the security holder whose proxy is solicited may specify how the securities registered in the security holder's name are to be voted.
(2) Subsection (1) does not apply if
(a) a poll is demanded by a security holder present at the meeting in person or represented at it by proxy, or
(b) more than 5% of all voting rights attached to all the securities, that are entitled to be voted and to be represented at the meeting, are represented by proxies who are required to vote against what would otherwise be the meeting's decision on the matters referred to in subsection (1).
(3) Voting securities of an issuer that are
(a) registered in the name of
(i) a registrant or the registrant's nominee, or
(ii) a custodian or the custodian's nominee, and
(b) not beneficially owned by the registrant or the custodian, as the case may be,
must not be voted by the registrant or custodian at any meeting of the issuer's security holders except in accordance with the regulations.
(4) Subsection (3) does not apply to a registrant or custodian who is a trustee of securities held under a trust instrument that regulates how those securities are to be voted.
119 (1) This Part does not apply to a reporting issuer who complies with the requirements of the law of the jurisdiction in which the reporting issuer carries on business or is incorporated, organized or continued, so long as those requirements are substantially similar to the requirements of this Part.
(2) The commission may order that a person or class of persons is exempt from one or more of the requirements of this Part or the regulations related to this Part if
(a) the requirement in respect of which an exemption is to be granted conflicts with a similar requirement of the law of the jurisdiction in which the reporting issuer is incorporated, organized or continued, or
(b) the commission considers that to do so would not be prejudicial to the public interest.
(3) An order under subsection (2) may be made on application by an interested person or on the commission's own motion.
120 (1) In this Part:
"investment" means a purchase of a security, a trade in an exchange contract, or a loan or advance to a person, but does not include a loan or advance that
(a) is made by a mutual fund, its mutual fund manager or its mutual fund distributor, and
(b) is merely ancillary to the main business of the mutual fund, its mutual fund manager or its mutual fund distributor;
"mutual fund" means a mutual fund in British Columbia;
"person responsible for the management of a mutual fund" includes a person who has a legal power or right to control, or who is in fact able to control, a mutual fund;
"related mutual funds" includes more than one mutual fund under common management;
"related person" means, in relation to a mutual fund, a person in whom the mutual fund, its mutual fund manager or its mutual fund distributor are prohibited by this Part from making an investment;
"responsible person" means
(a) a person responsible for the management of a mutual fund or its portfolio or advising the mutual fund with respect to its portfolio and every individual who is a partner, director or officer of that person,
(b) a related mutual fund,
(c) every associate or affiliate of a person that is a responsible person,
(d) every individual who is a partner, director or officer of an associate or affiliate of a person who, in relation to a mutual fund, is a responsible person, if the individual
(i) participates in the formulation of investment decisions made on behalf of the mutual fund, or
(ii) before implementation of investment decisions made on behalf of the mutual fund, has access to those decisions or to advice given to the mutual fund relating to those decisions, and
(e) every individual who is an employee of a person who, in relation to a mutual fund, is a responsible person, if the individual
(i) participates in the formulation of investment decisions made on behalf of the mutual fund, or
(ii) before implementation of investment decisions made on behalf of the mutual fund, has access to those decisions or to advice given to the mutual fund relating to those decisions.
(2) For the purposes of this Part,
(a) an issuer in which
(i) a mutual fund holds voting securities carrying more than 10% of the voting rights attached to all outstanding voting securities of the issuer, or
(ii) a mutual fund and related mutual funds hold voting securities carrying more than 20% of the voting rights attached to all outstanding voting securities of the issuer
is a related person of that mutual fund or of each of those mutual funds,
(b) a person or a group of persons has a significant interest in an issuer if, in the case of
(i) one person, the person owns beneficially, directly or indirectly, more than 10%, or
(ii) a group of persons, the group owns beneficially, directly or indirectly, individually or collectively, more than 50%,
of the outstanding securities of the issuer, and
(c) a person or a group of persons is a substantial security holder of an issuer if that person or group of persons owns beneficially, directly or indirectly, individually or collectively, voting securities carrying more than 20% of the voting rights attached to all outstanding voting securities of the issuer.
(3) For the purposes of this Part, if a person or a group of persons owns beneficially, directly or indirectly, voting securities of an issuer, that person or group of persons is deemed to own beneficially a proportion of voting securities of any other issuer that are owned beneficially, directly or indirectly, by the first mentioned issuer, which proportion is equal to the proportion of the voting securities of the first mentioned issuer that are owned beneficially, directly or indirectly, by that person or group of persons.
(4) For the purposes of subsection (2) (c), when computing the percentage of voting rights attached to voting securities owned by an underwriter, there must be excluded any voting securities acquired by him or her as underwriter in a distribution of the securities, but the exclusion ceases to have effect on completion or cessation of the distribution by the underwriter.
(5) Despite subsection (3), a mutual fund is not prohibited from making an investment in an issuer only because a person or a group of persons, who own beneficially, directly or indirectly, voting securities of the mutual fund, its mutual fund manager or its mutual fund distributor, is by reason of that ownership deemed under subsection (3) to own beneficially voting securities of the issuer.
121 (1) A mutual fund must not knowingly make or hold an investment by way of loan to or in
(a) an officer or director of the mutual fund, its mutual fund manager or its mutual fund distributor or an associate of any of them, or
(b) an individual if the individual or an associate of the individual is a substantial security holder of the mutual fund, its mutual fund manager or its mutual fund distributor.
(2) A mutual fund must not knowingly make or hold an investment to or in
(a) a person who is a substantial security holder of the mutual fund, its mutual fund manager or its mutual fund distributor,
(b) a person in which the mutual fund, alone or together with one or more related mutual funds, is a substantial security holder, or
(c) an issuer in which
(i) an officer or director of the mutual fund, its mutual fund manager or its mutual fund distributor or an associate of any of them, or
(ii) a person who is a substantial security holder of the mutual fund, its mutual fund manager or its mutual fund distributor,
has a significant interest.
(3) A mutual fund manager or mutual fund distributor must not knowingly hold an investment made after February 1, 1987 if the investment is an investment described in this section.
122 (1) A mutual fund, its mutual fund manager or its mutual fund distributor must not knowingly enter into a contract or other arrangement that results in its being directly or indirectly liable or contingently liable in respect of an investment in or to a person to whom it is prohibited by section 121 from making an investment.
(2) For the purposes of the application of this section to section 121, a contract or other arrangement referred to in subsection (1) of this section is deemed to be an investment.
123 On application of an interested person, the commission may order that section 121 or 122 does not apply to a class of investment, particular investment, contract or other arrangement, if the commission is satisfied that
(a) the class of investment, particular investment, contract or other arrangement represents the business judgment of responsible persons uninfluenced by considerations other than the best interests of a mutual fund, or
(b) the particular investment, contract or other arrangement is in the best interests of a mutual fund.
124 A mutual fund must not make an investment in consequence of which a related person of the mutual fund will receive a fee or other compensation unless
(a) the fees are paid under a contract that is disclosed in a preliminary prospectus or prospectus filed by the mutual fund and accepted by the executive director, or
(b) on the application of the mutual fund, the commission otherwise orders, if it considers that doing so would not be prejudicial to the public interest.
125 Every person responsible for the management of a mutual fund, and every person who performs a similar function in relation to a mutual fund as that person or who occupies a position or office with such a responsibility, must
(a) exercise the powers and discharge the duties related to that responsibility, function, position or office, in good faith and in the best interests of the mutual fund, and
(b) exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in the circumstances.
126 A mutual fund manager must file a report in the required form for each mutual fund to which the mutual fund manager provides services or advice respecting
(a) a purchase or sale of securities or a trade in exchange contracts between the mutual fund and any related person,
(b) a loan received by the mutual fund from, or made by the mutual fund to, any of its related persons,
(c) a purchase or sale of a security or a trade in an exchange contract effected by the mutual fund through any related person for which the related person received a fee from the mutual fund or from the other person to the transaction, or from both, and
(d) a transaction in which the mutual fund, by arrangement other than an arrangement relating to insider trading in portfolio securities, is a joint participant with one or more of its related persons,
within 30 days after the end of the month in which the purchase, sale, trade, loan or transaction occurs.
127 (1) A mutual fund or responsible person must not knowingly cause the mutual fund to
(a) invest in any issuer in which a responsible person is a partner, officer or director unless that fact is disclosed to the mutual fund security holders before the purchase,
(b) purchase or sell the securities of any issuer from or to the account of a responsible person, or
(c) make a loan to a responsible person.
(2) A mutual fund or a responsible person must not knowingly enter into a contract or other arrangement that results in the mutual fund being directly or indirectly liable or contingently liable in respect of a transaction that is prohibited by this section.
128 A person who has access to information concerning the investment program of a mutual fund or the investment portfolio managed for a client by a portfolio manager or by a registered dealer acting as a portfolio manager must not use that information to purchase or sell securities or to trade exchange contracts for the person's benefit or advantage.
129 If the law of the jurisdiction in which the reporting issuer carries on business or is incorporated, organized or continued requires substantially the same reports in that jurisdiction as are required by this Part, the filing requirements of this Part may be complied with by filing the reports that are required by the law of the other jurisdiction and that are signed or certified.
130 On application by an interested person or on the commission's own motion, the commission may order that a person or transaction or a class of persons or transactions is exempt from one or more of the requirements of this Part or the regulations related to this Part if
(a) the requirement in respect of which an exemption is to be granted conflicts with a similar requirement of the law of the jurisdiction in which the reporting issuer is incorporated, organized or continued, or
(b) the commission considers that to do so would not be prejudicial to the public interest.
131 (1) If a prospectus contains a misrepresentation, a person who purchases a security offered by the prospectus during the period of distribution
(a) is deemed to have relied on the misrepresentation if it was a misrepresentation at the time of purchase, and
(b) has a right of action for damages against
(i) the issuer or a selling security holder on whose behalf the distribution is made,
(ii) every underwriter of the securities who is required under section 69 to sign the certificate in the prospectus,
(iii) every director of the issuer at the time the prospectus was filed,
(iv) every person whose consent has been filed as prescribed, and
(v) every person who signed the prospectus.
(2) A person referred to in subsection (1) (b) (iv) is liable only with respect to a misrepresentation contained in a report, opinion or statement made by the person.
(3) If the person referred to in subsection (1) purchased the security from a person or underwriter referred to in subsection (1) (b) (i) or (ii) or from another underwriter of the securities, the purchaser may elect to exercise a right of rescission against that person or underwriter, in which case the purchaser has no right of action for damages against that person under subsection (1).
(4) A person is not liable under subsection (1) if the person proves that the purchaser had knowledge of the misrepresentation.
(5) A person is not liable under subsection (1) if the person proves that
(a) the prospectus was filed without the person's knowledge or consent and that, on becoming aware of its filing, the person gave reasonable general notice that it was so filed,
(b) after the issue of a receipt for the prospectus and before the purchase of the securities by the purchaser, on becoming aware of any misrepresentation in the prospectus, the person withdrew the person's consent to it and gave reasonable general notice of the withdrawal and the reason for it,
(c) with respect to any part of the prospectus purporting
(i) to be made on the authority of an expert, or
(ii) to be a copy of, or an extract from, a report, opinion or statement of an expert,
the person had no reasonable grounds to believe and did not believe that
(iii) there had been a misrepresentation, or
(iv) the relevant part of the prospectus
(A) did not fairly represent the report, opinion or statement of the expert, or
(B) was not a fair copy of, or an extract from, the report, opinion or statement of the expert,
(d) with respect to any part of the prospectus purporting
(i) to be made on the person's own authority as an expert, or
(ii) to be a copy of, or an extract from, the person's own report, opinion or statement as an expert,
but that contained a misrepresentation attributable to failure to fairly represent the person's report, opinion or statement as an expert,
(iii) the person had, after reasonable investigation, reasonable grounds to believe and did believe that the relevant part of the prospectus fairly represented the person's report, opinion or statement as an expert, or
(iv) on becoming aware that the relevant part of the prospectus did not fairly represent the person's report, opinion or statement as an expert, the person, as soon as practicable, advised the commission and gave reasonable general notice that
(A) the person's report, opinion or statement was not fairly represented, and
(B) the person would not be responsible for that part of the prospectus, or
(e) with respect to a false statement
(i) purporting to be a statement made by an official person, or
(ii) contained in what purports to be a copy of, or an extract from, a public official document,
it was a correct and fair representation of the statement or copy of, or an extract from, the document, and the person had reasonable grounds to believe and did believe that the statement was true.
(6) A person is not liable under subsection (1) with respect to any part of the prospectus purporting
(a) to be made on the person's own authority as an expert, or
(b) to be a copy of, or an extract from, the person's own report, opinion or statement as an expert
unless the person
(c) failed to conduct a reasonable investigation to provide reasonable grounds for a belief that there had been no misrepresentation, or
(d) believed that there had been a misrepresentation.
(7) A person is not liable under subsection (1) with respect to any part of the prospectus not purporting
(a) to be made on the authority of an expert, and
(b) to be a copy of, or an extract from, a report, opinion or statement of an expert
unless the person
(c) failed to conduct a reasonable investigation to provide reasonable grounds for a belief that there had been no misrepresentation, or
(d) believed that there had been a misrepresentation.
(8) Subsections (5) to (7) do not apply to the issuer or a selling security holder.
(9) An underwriter is not liable for more than the total public offering price represented by the portion of the distribution underwritten by the underwriter.
(10) In an action for damages under subsection (1), the defendant is not liable for all or any part of the damages that the defendant proves does not represent the depreciation in value of the security resulting from the misrepresentation.
(11) The liability of all persons referred to in subsection (1) (b) is joint and several as between themselves with respect to the same cause of action.
(12) A defendant who is found liable to pay a sum in damages may recover a contribution, in whole or in part, from a person who is jointly and severally liable under this section to make the same payment in the same cause of action unless, in all the circumstances of the case, the court is satisfied that it would not be just and equitable.
(13) The amount recoverable by a plaintiff under this section must not exceed the price at which the securities purchased by the plaintiff were offered to the public.
(14) The right of action for rescission or damages conferred by this section is in addition to and not in derogation from any other right the purchaser may have.
(15) If a misrepresentation is contained in a summary statement of a mutual fund filed with a prospectus, the misrepresentation is deemed to be contained in the prospectus.
(16) If a misrepresentation is contained in an annual information form filed with a simplified prospectus, the misrepresentation is deemed to be contained in the simplified prospectus.
132 (1) If a take over bid circular, issuer bid circular, notice of change or notice of variation sent under Part 13 contains a misrepresentation, a person to whom the circular or notice was sent is deemed to have relied on the misrepresentation, and has a right of action for
(a) rescission against the offeror, or
(b) damages against
(i) each person who signed the certificate in the circular or notice,
(ii) every director of the offeror at the time the circular or notice was signed,
(iii) every person whose consent has been filed as prescribed, and
(iv) the offeror.
(2) A person referred to in subsection (1) (b) (iii) is liable only with respect to a misrepresentation contained in a report, opinion or statement made by the person.
(3) If a directors' circular or a director's or officer's circular or a notice of change in respect of a directors' circular or a director's or officer's circular sent under Part 13 contains a misrepresentation, a person to whom the circular or notice was sent is deemed to have relied on the misrepresentation and has a right of action for damages against every director or officer who signed the circular or notice.
(4) A person is not liable under subsection (1) or (3) if the person proves that the person exercising the right of action had knowledge of the misrepresentation.
(5) A person is not liable under subsection (1) or (3) if the person proves that
(a) the circular or notice was sent without the person's knowledge or consent and that, on becoming aware of that fact, the person gave, as soon as practicable, reasonable general notice that it was so sent,
(b) after sending of the circular or notice and on becoming aware of any misrepresentation in the circular or notice, the person withdrew the person's consent to it and gave reasonable general notice of the withdrawal and the reason for it,
(c) with respect to any part of the circular or notice purporting
(i) to be made on the authority of an expert, or
(ii) to be a copy of, or an extract from, a report, opinion or statement of an expert,
the person had no reasonable grounds to believe and did not believe that
(iii) there had been a misrepresentation, or
(iv) the relevant part of the circular or notice
(A) did not fairly represent the report, opinion or statement of the expert, or
(B) was not a fair copy of, or extract from, the report, opinion or statement of the expert,
(d) with respect to any part of the circular or notice purporting
(i) to be made on the person's own authority as an expert, or
(ii) to be a copy of, or an extract from, the person's own report, opinion or statement as an expert,
but that contained a misrepresentation attributable to failure to fairly represent the person's report, opinion or statement as an expert
(iii) the person had, after reasonable investigation, reasonable grounds to believe and did believe that the relevant part of the circular or notice fairly represented his report, opinion or statement as an expert, or
(iv) on becoming aware that the relevant part of the circular or notice did not fairly represent the person's report, opinion or statement as an expert, the person, as soon as practicable, advised the commission and gave reasonable general notice that
(A) the person's report, opinion or statement was not fairly represented, and
(B) the person would not be responsible for that part of the circular or notice, or
(e) with respect to a false statement,
(i) purporting to be a statement made by an official person, or
(ii) contained in what purports to be a copy of, or extract from, a public official document,
it was a correct and fair representation of the statement or copy of, or extract from, the document, and the person had reasonable grounds to believe and did believe that the statement was true.
(6) A person is not liable under subsection (1) or (3) with respect to any part of the circular or notice purporting
(a) to be made on the person's own authority as an expert, or
(b) to be a copy of, or an extract from, the person's own report, opinion or statement as an expert
unless the person
(c) failed to conduct a reasonable investigation to provide reasonable grounds for a belief that there had been no misrepresentation, or
(d) believed there had been a misrepresentation.
(7) A person is not liable under subsection (1) or (3) with respect to any part of the circular or notice not purporting
(a) to be made on the authority of an expert, and
(b) to be a copy of, or an extract from, a report, opinion or statement of an expert
unless the person
(c) failed to conduct a reasonable investigation to provide reasonable grounds for a belief that there had been no misrepresentation, or
(d) believed there had been a misrepresentation.
(8) Subsections (5) to (7) do not apply to the offeror.
(9) The liability of
(a) all persons referred to in subsection (1) (b), or
(b) all directors and officers referred to in subsection (3),
is joint and several as between themselves with respect to the same cause of action.
(10) A defendant who is found liable to pay a sum in damages may recover a contribution, in whole or in part, from a person who is jointly and severally liable under this section to make the same payment in the same cause of action unless, in all the circumstances of the case, the court is satisfied that it would not be just and equitable.
(11) In an action for damages under subsection (1) or (3) based on a misrepresentation affecting a security offered by the offeror in exchange for securities of the offeree issuer, the defendant is not liable for all or any part of the damages that the defendant proves does not represent the depreciation in value of the security resulting from the misrepresentation.
(12) For purposes of this section, if the offeror in a take over bid or an issuer bid described in section 98 (1) (a) or 99 (e) is required by the bylaws, rules or other regulatory instruments or policies of the exchange, on or through the facilities of which the bid is made, to file a disclosure record with the exchange or to deliver a disclosure record, the disclosure record is deemed to be a take over bid circular, issuer bid circular, notice of change or notice of variation, as the case may be, sent as required by Part 13.
(13) The right of action for rescission or damages conferred by this section is in addition to and not in derogation from any other right available.
133 In determining what is a reasonable investigation or what are reasonable grounds for belief for the purposes of sections 131 and 132, the standard of reasonableness must be that required of a prudent person in the circumstances of the particular case.
134 (1) If a registered dealer makes a contract with a client to buy and carry on margin the securities of any issuer, and
(a) while the contract continues, the dealer sells securities of the same issuer for any account in which the dealer, the dealer's director, the dealer's firm, or a partner in the dealer's firm has a direct or indirect interest, and
(b) the effect of the sale is to reduce the amount of those securities in the hands of the dealer or under the dealer's control in the ordinary course of business to below the amount of those securities that the dealer should be carrying for all the dealer's clients,
the dealer must immediately disclose those facts to the client, and the contract with the client is voidable at the election of the client.
(2) If a client elects under subsection (1) to void the contract, the client may, in respect of that contract, recover from the dealer
(a) all money paid by the client to the dealer with interest, and
(b) any securities deposited by the client with the dealer.
(3) If a client elects under subsection (1), the client must send written notice to the registered dealer within 30 days after the disclosure made to the client under that subsection.
(4) A dealer is not liable under subsection (1) if the dealer proves that the reduction of the amount of securities to below the amount the dealer should be carrying was unintentional.
135 A person who is
(a) a purchaser of a security to whom a prospectus or any amendment to a prospectus was required under section 83 to be sent but which prospectus or amendment was not sent or was not filed under the Act, or
(b) a person to whom a take over bid circular, issuer bid circular, notice of change or notice of variation was required under Part 13 to be delivered but which circular or notice was not delivered,
has a right of action for damages or rescission against the dealer or offeror who failed to comply with the applicable requirement.
136 (1) For the purposes of subsections (2) and (3), "securities of the reporting issuer" or "securities of a reporting issuer" includes
(a) a put, a call, an option or another right or obligation to purchase or sell securities of the reporting issuer, or
(b) a security, the market price of which varies materially with the market price of any securities of the reporting issuer.
(2) If a person purchases or sells securities of a reporting issuer at any time when the person
(a) is in a special relationship with the reporting issuer, and
(b) knows of a material fact or material change with respect to the reporting issuer, which material fact or material change has not been generally disclosed,
the person is liable to compensate the seller or purchaser, as the case may be, of the securities of the reporting issuer for damages as a result of the purchase or sale unless the person proves that, at the time of the purchase or sale,
(c) the person reasonably believed that the material fact or material change had been generally disclosed, or
(d) the material fact or material change was known or ought reasonably to have been known to the seller or purchaser, as the case may be.
(3) If a person (the "first person") who is
(a) a reporting issuer,
(b) a person in a special relationship with a reporting issuer, or
(c) a person that proposes to
(i) make a take over bid, as defined in section 92, for the securities of a reporting issuer,
(ii) become a party to a reorganization, amalgamation, merger, arrangement or similar business combination with a reporting issuer, or
(iii) acquire a substantial portion of the property of a reporting issuer
informs another person of a material fact or material change with respect to the reporting issuer before the material fact or material change has been generally disclosed, the first person is liable to compensate for damages any person that after that time sells securities of the reporting issuer to or purchases securities of the reporting issuer from the person that received the information unless the first person proves that,
(d) at the time of giving the information, the first person reasonably believed the material fact or material change had been generally disclosed,
(e) at the time of the sale or purchase, as the case may be, the person who sold securities of the reporting issuer to or purchased securities of the reporting issuer from the person who received the information knew or reasonably ought to have known of the material fact or material change,
(f) in the case of an action against a reporting issuer or a person in a special relationship with a reporting issuer, the information was given in the course of business of the reporting issuer or of the person in a special relationship with a reporting issuer, or
(g) in the case of an action against a person described in paragraph (c), the giving of the information was necessary to effect the take over bid, business combination or acquisition, as the case may be.
(4) If a person
(a) has access to information concerning the investment program of a mutual fund in British Columbia or the investment portfolio managed for a client by a portfolio manager or by a registered dealer acting as a portfolio manager, and
(b) uses that information to purchase or sell securities or to trade exchange contracts for the person's benefit or advantage,
the person is liable to account to the mutual fund or the client of the portfolio manager or registered dealer, as the case may be, for any benefit or advantage received or receivable by the person as a result of the purchase or sale of securities or the trade in exchange contracts.
(5) If a person (the "first person") that is an insider, affiliate or associate of a reporting issuer
(a) sells or purchases securities of the reporting issuer with knowledge of a material fact or material change with respect to the reporting issuer, which material fact or material change has not been generally disclosed, or
(b) informs another person of a material fact or material change with respect to the reporting issuer before the material fact or material change has been generally disclosed, unless giving the information is necessary in the course of business of the reporting issuer or the insider, affiliate or associate of the reporting issuer,
the first person is liable to account to the reporting issuer for any benefit or advantage received or receivable by the first person or the other person as a result of the purchase, sale or giving of information, as the case may be, unless the first person proves that, at the time of the purchase, sale or giving of information, the first person reasonably believed that the material fact or material change had been generally disclosed.
(6) If 2 or more persons in a special relationship with a reporting issuer are liable under subsection (2) or (3) as to the same transaction or series of transactions, their liability is joint and several.
(7) In assessing damages under subsection (2) or (3), the court must consider,
(a) if the plaintiff is a purchaser, the price that the plaintiff paid for the security less the average market price of the security over the 20 trading days immediately following general disclosure of the material fact or material change,
(b) if the plaintiff is a seller, the average market price of the security over the 20 trading days immediately following general disclosure of the material fact or material change less the price that the plaintiff received for the security, and
(c) any other measure of damages the court considers relevant in the circumstances.
137 (1) On application by
(a) the commission, or
(b) any person who
(i) was, at the time of a transaction referred to in section 136 (2) or (3), or
(ii) is, at the time of the application,
a security holder of the reporting issuer,
the Supreme Court may, if satisfied that
(c) the applicant has reasonable grounds for believing that the reporting issuer has a cause of action under section 136 (5), and
(d) the reporting issuer has
(i) refused or failed to commence an action under section 136 (5) within 60 days after receipt of a written request from the applicant to do so, or
(ii) failed to prosecute diligently an action commenced by it under section 136 (5),
make an order, on any terms as to security for costs or otherwise that it considers proper, requiring the commission or authorizing the person or the commission to commence or continue an action in the name of, and on behalf of, the reporting issuer to enforce the liability created by section 136 (5).
(2) On application by
(a) the commission, or
(b) any person who
(i) was, at the time of a transaction referred to in section 136 (4), or
(ii) is, at the time of the application,
a security holder of the mutual fund,
the Supreme Court may, if satisfied that
(c) the applicant has reasonable grounds for believing that the mutual fund has a cause of action under section 136 (4), and
(d) the mutual fund has
(i) refused or failed to commence an action under section 136 (4) within 60 days after receipt of a written request from the applicant to do so, or
(ii) failed to prosecute diligently an action commenced by it under section 136 (4),
make an order, on any terms as to security for costs or otherwise that it considers proper, requiring the commission or authorizing the person or the commission to commence or continue an action in the name of, and on behalf of, the mutual fund to enforce the liability created by section 136 (4).
(3) If an action under section 136 (4) or (5) is commenced or continued by the directors of the reporting issuer, the Supreme Court may order the reporting issuer to pay all costs properly incurred by the directors in commencing or continuing the action, as the case may be, if it is satisfied that the action is in the best interests of the reporting issuer and its security holders.
(4) If an action under section 136 (4) or (5) is commenced or continued by a person who is a security holder of the reporting issuer, the Supreme Court may order the reporting issuer to pay all costs properly incurred by the security holder in commencing or continuing the action, as the case may be, if it is satisfied that
(a) the reporting issuer refused or failed to commence the action or, having commenced it, failed to prosecute it diligently, and
(b) the action is in the best interests of the reporting issuer and its security holders.
(5) If an action under section 136 (4) or (5) is commenced or continued by the commission, the Supreme Court must order the reporting issuer to pay all costs properly incurred by the commission in commencing or continuing the action, as the case may be.
(6) In determining whether an action or its continuance is in the best interests of a reporting issuer and its security holders, the court must consider the relationship between the potential benefit to be derived from the action by the reporting issuer and its security holders and the cost involved in the prosecution of the action.
(7) Notice of every application under subsection (1) or (2) must be sent to the commission and the reporting issuer, or the mutual fund, as the case may be, and each of them may appear and be heard.
(8) An order made under subsection (1) or (2) requiring or authorizing the commission to commence or continue an action must provide that the reporting issuer or mutual fund, as the case may be,
(a) cooperate fully with the commission in the commencement or continuation of the action, and
(b) make available to the commission all records and other material or information relevant to the action and known to, or reasonably ascertainable by, the reporting issuer or mutual fund.
138 (1) If section 51 (2) applies to a contract and is not complied with, a person who has entered into the contract may rescind it by sending a written notice of rescission to the registered dealer within 60 days of the date of the delivery of the security to the person or by the person if the person is, at the time the notice of rescission is given, the beneficial owner of the security purchased.
(2) If a registered dealer
(a) is required by the regulations to give to a client a written confirmation of a trade in a security setting out that the registered dealer has acted as principal in the transaction, and
(b) has failed to comply with that requirement,
a person who has entered into the contract may rescind it by sending a written notice of rescission to the registered dealer within 7 days of the date of the delivery of the written confirmation of the contract.
(3) In an action for rescission to which this section applies, the onus of proving compliance with section 51 or the regulations is on the registered dealer.
(4) An action for rescission must not be commenced under this section after the end of 90 days from the date of sending the notice under subsection (1) or (2).
139 (1) Every purchaser of a security of a mutual fund in British Columbia may, if the amount of the purchase does not exceed a prescribed amount, rescind the purchase by sending a written notice to the registered dealer from whom the purchase was made,
(a) in the case of a lump sum purchase, within 48 hours after receipt of the confirmation, or
(b) in the case of a contractual plan, within 60 days after receipt of the confirmation of the initial payment.
(2) Subject to subsection (4), the amount a purchaser may recover on exercise of a right to rescind under subsection (1) must not exceed the net asset value, at the time the right is exercised, of the securities purchased.
(3) The right to rescind a purchase made under a contractual plan may be exercised only with respect to payments scheduled to be made within the time specified in subsection (1) for rescinding a purchase made under a contractual plan.
(4) Every registered dealer from whom the purchase of a security of a mutual fund was made must reimburse the purchaser who has exercised the purchaser's right of rescission in accordance with this section for the amount of sales charges and fees relevant to the investment of the purchaser in the mutual fund in respect of the securities for which the written notice of rescission was given.
140 Unless otherwise provided in this Act or in the regulations, an action to enforce a civil remedy created by this Part or by the regulations must not be commenced
(a) in the case of an action for rescission, more than 180 days after the date of the transaction that gave rise to the cause of action, or
(b) in the case of an action other than for rescission, more than the earlier of
(i) 180 days after the plaintiff first had knowledge of the facts giving rise to the cause of action, or
(ii) 3 years after the date of the transaction that gave rise to the cause of action.
141 (1) The executive director may make an order under subsection (2)
(a) for the administration of this Act,
(b) to assist in the administration of the securities laws of another jurisdiction,
(c) in respect of matters relating to trading in securities in British Columbia, or
(d) in respect of matters in British Columbia relating to trading in securities in another jurisdiction.
(2) By an order applicable generally or to one or more persons or entities named or otherwise described in the order, the executive director may require any of the following persons to provide information or to produce records or classes of records specified or otherwise described in the order within the time or at the intervals specified in the order:
(a) a clearing agency;
(b) a registrant;
(c) a person exempted from the requirement to be registered under section 34 by an order under section 48;
(d) a reporting issuer;
(e) a manager or custodian of assets, shares or units of a mutual fund;
(f) a general partner of a person referred to in paragraph (b), (c), (d), (g), (j) or (k);
(g) a person purporting to distribute securities in reliance on an exemption
(i) described in section 74 (2), or
(ii) in an order issued under section 76;
(h) a transfer agent or registrar for securities of a reporting issuer;
(i) a director or officer of a reporting issuer;
(j) a promoter or control person of a reporting issuer;
(k) a person engaged in investor relations activities on behalf of a reporting issuer or security holder of a reporting issuer;
(l) the Canadian Investor Protection Fund.
(3) The executive director may require verification by affidavit of information provided or records or classes of records produced pursuant to an order under subsection (2).
142 (1) The commission may, by order, appoint a person to make an investigation the commission considers expedient
(a) for the administration of this Act,
(b) to assist in the administration of the securities or exchange contracts laws of another jurisdiction,
(c) in respect of matters relating to trading in securities or exchange contracts in British Columbia, or
(d) in respect of matters in British Columbia relating to trading in securities or exchange contracts in another jurisdiction.
(2) In its order, the commission must specify the scope of an investigation to be carried out under subsection (1).
143 (1) An investigator appointed under section 142 or 147 may, with respect to the person who is the subject of the investigation, investigate, inquire into, inspect and examine
(a) the affairs of that person,
(b) any records, negotiations, transactions, investigations, investments, loans, borrowings and payments to, by, on behalf of, in relation to or connected with that person,
(c) any property, assets or things owned, acquired or disposed of in whole or in part by that person or by a person acting on behalf of or as agent for that person,
(d) the assets at any time held by, the liabilities, debts, undertakings and obligations at any time existing and the financial or other conditions at any time prevailing in respect of that person, and
(e) the relationship that may at any time exist or have existed between that person and any other person by reason of
(i) investments made,
(ii) commissions promised, secured or paid,
(iii) interests held or acquired,
(iv) the lending or borrowing of money, securities or other property,
(v) the transfer, negotiation or holding of securities or exchange contracts,
(vi) interlocking directorates,
(vii) common control,
(viii) undue influence or control, or
(ix) any other relationship.
(2) On being satisfied that it is necessary and in the public interest, the commission may, by order, authorize an investigator appointed under section 142
(a) to enter the business premises of
(i) a registrant specified in the order,
(ii) a self regulatory body recognized under section 24 (1), or
(iii) an exchange recognized under section 24 (2),
during business hours for the purpose of carrying out an inspection, examination or analysis of records, property, assets or things that are used in the business of that person and that may reasonably relate to the order made under section 142,
(b) to require the production of the records, property, assets or things referred to in paragraph (a) and to inspect, examine or analyze them, and
(c) on giving a receipt, to remove the records, property, assets or things inspected, examined or analyzed under paragraph (a) or (b) for the purpose of further inspection, examination or analysis.
(3) On application by the commission and on being satisfied by information on oath that there are reasonable and probable grounds to believe that there may be anything that may reasonably relate to an order made under section 142,
(a) in a business premise, or
(b) in a building, receptacle or place, other than a room or place actually being used as a residence,
the Supreme Court may make an order authorizing a person named in the order
(c) to enter into that business premise, building or receptacle at any reasonable time, for the purpose of carrying out an inspection, examination or analysis of records, property, assets or things that may reasonably relate to the order made under section 142,
(d) to require the production of the records, property, assets or things referred to in paragraph (c) and to inspect, examine or analyze them, and
(e) on giving a receipt, to remove the records, property, assets or things referred to in paragraph (c) for the purpose of further inspection, examination or analysis.
(4) An application for an order under subsection (3) must be made in the prescribed manner and, unless the Supreme Court otherwise directs, may be
(a) made without notice, and
(b) heard in the absence of the public.
(5) Inspection, examination or analysis under this section must be completed as soon as practical and the records, property, assets or things must be returned promptly to the person who produced them.
(6) On an inspection, examination or analysis under this section, an investigator appointed under section 142 and authorized under subsection (2) of this section, a person named in an order under subsection (3) of this section or a person acting under the direction of either of them may
(a) mark the records, property, assets or things for identification, or
(b) use or alter the records, property, assets or things to the extent reasonably necessary to facilitate the inspection, examination or analysis,
and does not incur any liability because of doing so.
(7) A person must not
(a) withhold, destroy, conceal or refuse to give any information, or
(b) withhold, destroy, conceal or refuse to produce any record or thing
reasonably required under subsection (2) or (3) by
(c) an investigator appointed under section 142 and authorized under subsection (2) of this section, or
(d) a person named in an order under subsection (3) of this section.
144 (1) An investigator appointed under section 142 or 147 has the same power
(a) to summon and enforce the attendance of witnesses,
(b) to compel witnesses to give evidence on oath or in any other manner, and
(c) to compel witnesses to produce records and things and classes of records and things
as the Supreme Court has for the trial of civil actions.
(2) The failure or refusal of a witness
(a) to attend,
(b) to take an oath,
(c) to answer questions, or
(d) to produce the records and things or classes of records and things in the custody, possession or control of the witness
makes the witness, on application to the Supreme Court, liable to be committed for contempt as if in breach of an order or judgment of the Supreme Court.
(3) Section 34 of the Evidence Act does not exempt any financial institution, as defined in that section of that Act, or any officer or employee of the institution from the operation of this section.
(4) A witness giving evidence at an investigation conducted under section 142 or 147 may be represented by counsel.
145 If an investigation is ordered under section 142, the commission may appoint an expert to examine the affairs, records and properties of the person being investigated.
146 A person appointed under section 142 or 145 must provide, at the request of the commission or a member of the commission involved in making the appointment, a complete report of the investigation, examination or analysis made, including any transcript of evidence and material in the person's possession relating to the investigation or examination.
147 (1) The minister may, by order, appoint a person to make an investigation the minister considers expedient
(a) for the administration of this Act,
(b) to assist in the administration of the securities or exchange contracts laws of another jurisdiction,
(c) in respect of matters relating to trading in securities or exchange contracts in British Columbia, or
(d) in respect of matters in British Columbia relating to trading in securities or exchange contracts in another jurisdiction.
(2) In the order, the minister must specify the scope of an investigation to be carried out under subsection (1).
148 (1) Without the consent of the commission, a person must not disclose, except to the person's counsel, any information or evidence obtained or the name of any witness examined or sought to be examined under section 143, 144 or 145.
(2) Subsection (1) applies despite any provision of the Freedom of Information and Protection of Privacy Act other than section 44 (2) and (3) of that Act.
(3) Subsection (2) does not apply to personal information, as defined in the Freedom of Information and Protection of Privacy Act, that has been in existence for 100 or more years or to other information that has been in existence for 50 or more years.
149 (1) If an investigation has been made under section 142 or 147, then, if requested to do so by the minister, the commission or the investigator, as the case may be, must make a complete report to the minister including, if so requested, the evidence, findings, comments, recommendations and any material in the possession of the commission or investigator relating to the investigation.
(2) The minister may publish all or part of a report under subsection (1) in any way the minister considers proper.
150 The commission may require a person whose affairs are investigated under this Part to pay prescribed fees or charges for the costs of the investigation.
151 (1) The commission may make a direction under subsection (2) if
(a) it proposes to order an investigation in respect of a person under section 142 or during or after an investigation in respect of a person under section 142 or 147,
(b) it or the executive director proposes to make or has made an order under section 161 in respect of a person,
(c) criminal proceedings or proceedings in respect of a contravention of this Act or the regulations are about to be or have been instituted against a person and the commission considers the proceedings to be connected with or to arise out of a security or exchange contract or a matter relating to trading in securities or exchange contracts, or out of any business conducted by the person, or
(d) a person fails or neglects to comply with financial conditions applicable to the person under the Act or the regulations.
(2) In the circumstances described in subsection (1), the commission may direct, in writing,
(a) a person having on deposit, under control or for safekeeping any funds, securities, exchange contracts or other property of the person referred to in subsection (1) (a), (b), (c) or (d), to hold those funds, securities, exchange contracts or other property, and
(b) a person referred to in subsection (1) (a), (b), (c) or (d)
(i) to refrain from withdrawing any funds, securities, exchange contracts or other property from any person having them on deposit, under control or for safekeeping, or
(ii) to hold all funds, securities, exchange contracts or other property of clients or others in the person's possession or control in trust for an interim receiver, custodian, trustee, receiver manager, receiver or liquidator appointed under the Bankruptcy Act (Canada), the Company Act, the Law and Equity Act, the Personal Property Security Act, the Winding-up Act (Canada), the Supreme Court Act or this Act.
(3) In the case of a savings institution, a direction of the commission under subsection (2) applies only to the offices, branches or agencies of the savings institution that are named in the direction.
(4) A direction of the commission under subsection (2) does not apply to funds, securities, exchange contracts or other property in a clearing agency or to securities in process of transfer by a transfer agent unless the direction expressly so states.
(5) In any of the circumstances referred to in subsection (1) (a) to (d), the commission may, in writing, notify a land title office or gold commissioner that proceedings are being or are about to be taken that may affect land or mining claims belonging to the affected person.
(6) The commission may, in writing, revoke or modify a notice given under subsection (5) and, if a notice is revoked or modified, the commission must send a copy of the written revocation or modification to the land title office or gold commissioner, as the case may be.
(7) A notice sent under subsection (5) or a copy of a written revocation or modification under subsection (6) must be registered or recorded against the lands or claims mentioned in it and has the same effect as the registration or recording of a certificate of pending litigation or a caveat.
152 (1) If any of the circumstances referred to in section 151 (1) (a) to (d) exist, the commission may apply to the Supreme Court for the appointment of a receiver, receiver manager or a trustee of all or any part of the property of the person.
(2) On an application under subsection (1), the court may, by order, appoint a receiver, receiver manager or a trustee of all or any part of the property of the person, if the court is satisfied that the appointment is in the best interests of
(a) that person's creditors,
(b) persons, any of whose property is in the possession or under the control of that person, or
(c) the security holders of or subscribers to that person.
(3) The commission may make an application under this section without notice to any other person and, in that event, the court may make a temporary order under subsection (2) appointing a receiver, receiver manager or a trustee for a period not longer than 15 days.
(4) A receiver, receiver manager or trustee appointed under this section
(a) must be the receiver, receiver manager or trustee of all or any part of the property belonging to the person or held by the person on behalf of or in trust for any other person, and
(b) may, if authorized by the court, wind up or manage the business and affairs of the person and may exercise powers necessary or incidental to the winding up or management.
153 (1) Despite sections 31 and 32, if the commission considers it to be in the public interest, the commission may appoint in writing a person to
(a) conduct an examination and inspection of the financial affairs and records of
(i) a self regulatory body or an exchange, as the case may be, which has been recognized by the commission under section 24,
(ii) a clearing agency,
(iii) a registrant,
(iv) a reporting issuer,
(v) a custodian of assets of a mutual fund, or
(vi) a custodian of securities issued by a mutual fund and held under a custodial agreement or other arrangement with a person engaged in the distribution of those securities, and
(b) prepare financial or other statements and reports required by the commission.
(2) A person appointed under subsection (1) may inquire into and examine all trades, securities, exchange contracts, cash and records of every description of the person whose financial affairs are being examined.
(3) A person must not withhold, destroy, conceal or refuse to give any information, record or thing reasonably required for an examination under this section.
(4) The commission may require the person whose affairs are examined under this section to pay prescribed fees or charges for the examination.
154 If the commission considers this would not be prejudicial to the public interest, it may authorize disclosure of facts, information and records obtained under this Part to any body empowered by the laws of another jurisdiction to administer or regulate trading in securities or exchange contracts in that jurisdiction.
155 (1) A person who does any of the following commits an offence:
(a) makes a statement in evidence or information submitted or given under this Act or the regulations to the commission, the executive director or any person appointed to make an investigation or audit under this Act or the regulations that, at the time and in light of the circumstances under which it is made, is a misrepresentation;
(b) fails to file, provide, deliver or send a record that
(i) is required to be filed, provided, delivered or sent under this Act or the regulations, or
(ii) is required to be filed, provided, delivered or sent under this Act or the regulations within the time required under this Act or the regulations;
(c) makes a statement in any record required to be filed, provided, delivered or sent under this Act or the regulations that, at the time and in light of the circumstances under which it is made, is a misrepresentation;
(d) contravenes any of section 29 (6), 34, 39 (6), 49 to 59, 61, 70 (1), 85 to 87, 100 to 112, 117 (1) and (2), 121, 122, 124, 125, 127, 128, 143 (7), 148 or 153 (3) of this Act;
(e) fails to observe or to comply with a decision made under this Act;
(f) contravenes any of the provisions of the regulations that are specified by regulation for the purpose of this paragraph;
(g) contravenes any of the provisions of the commission rules that are specified by regulation for the purpose of this paragraph.
(2) A person who commits an offence under subsection (1) is liable, in the case of a person other than an individual, to a fine of not more than $1 million and, in the case of an individual, to a fine of not more than $1 million or to imprisonment for not more than 3 years or to both.
(3) A person does not commit an offence under subsection (1) (a) or (c) if the person
(a) did not know, and
(b) in the exercise of reasonable diligence, could not have known,
that the statement was a misrepresentation.
(4) If a person, other than an individual, commits an offence under subsection (1), an employee, officer, director or agent of that person who authorizes, permits or acquiesces in the offence commits the same offence whether or not that person is convicted of the offence.
(5) Despite subsection (2), if a person has contravened section 86 (1), the fine to which that person is liable is
(a) not less than any profit made by that person because of the contravention of section 86 (1), and
(b) not more than the greater of
(i) $1 million, and
(ii) an amount equal to triple any profit made by that person because of the contravention of section 86 (1).
(6) Despite subsection (2), if a person has contravened section 86 (2) or (3), the fine to which that person is liable is
(a) not less than any profit made by that person because of the contravention of section 86 (2) or (3), and
(b) not more than the greatest of
(i) $1 million,
(ii) an amount equal to triple any profit made by that person because of the contravention of section 86 (2) or (3), and
(iii) an amount equal to triple any profit made by one or more other persons who
(A) were informed by that person of the material fact or material change in contravention of section 86 (2) or (3), and
(B) with knowledge of the material fact or material change, purchased or sold securities in contravention of section 86 (1).
(7) For the purposes of subsections (5) and (6), "profit" means the applicable amount determined as follows:
(a) profit of a person who purchased securities in contravention of section 86 (1) means the amount determined by
(i) ascertaining the average market price of the security over the 20 trading days immediately following general disclosure of the material fact or material change, and
(ii) subtracting from that average market price the amount paid by that person for the securities;
(b) profit of a person who sold securities in contravention of section 86 (1), means the amount determined by
(i) ascertaining the amount received by that person for the securities, and
(ii) subtracting from that amount the average market price of the securities over the 20 trading days immediately following general disclosure of the material fact or material change;
(c) profit of a person who informed one or more other persons of a material fact or material change in contravention of section 86 (2) or (3) and received any direct or indirect consideration for the information, means the value of the consideration received by that person.
156 (1) If a court of another province issues a warrant for the arrest of a person on a charge of contravening the provisions of an Act or regulations of that province that are similar to the provisions of this Act or the regulations, a British Columbia court within whose territorial jurisdiction that person is or is suspected to be, may, on satisfactory proof of the handwriting of the person who issued the warrant, make an endorsement on the warrant in the required form.
(2) A warrant endorsed under subsection (1) is sufficient authority to
(a) the person bringing the warrant,
(b) all other persons to whom it was originally directed, and
(c) all peace officers within the territorial jurisdiction of the British Columbia court endorsing the warrant,
to execute the warrant within that jurisdiction, to take the person arrested under the warrant out of, or anywhere in, British Columbia and to re-arrest that person anywhere in British Columbia.
(3) A peace officer
(a) of British Columbia, or
(b) of any other province who is passing through British Columbia,
having in the peace officer's custody a person arrested in another province under a warrant endorsed under subsection (1), is entitled to hold, take and re-arrest the person anywhere in British Columbia under the warrant without proof of the warrant or the endorsement.
157 (1) In addition to any other powers it may have, if the commission considers that a person has failed to comply with or is violating a provision of this Act or of the regulations or has failed to comply with or is violating a decision, the commission may apply to the Supreme Court for one or both of the following:
(a) an order that
(i) the person comply with or cease violating the provision or decision, and
(ii) the directors and senior officers of the person cause the person to comply with or to cease violating the provision or decision;
(b) an order that the person pay to the minister for payment into the consolidated revenue fund one or both of the following:
(i) any moneys obtained by the person directly or indirectly as a result of the failure to comply or the violation;
(ii) the amount of any payments or losses avoided by the person directly or indirectly as a result of the failure to comply or the violation.
(2) On an application under subsection (1), the Supreme Court may make the order applied for and any other order the court considers appropriate, including without limiting this, an order
(a) setting aside a transaction relating to trading in securities or exchange contracts,
(b) requiring the issuance or cancellation of a security or the purchase, disposition or exchange of a security or exchange contract,
(c) prohibiting the voting of a security or the exercise of a right attaching to a security or exchange contract, and
(d) appointing a director of the person that is the subject of the application.
(3) An order may be made under this section even though a penalty has already been imposed on that person in respect of the same non-compliance or violation.
158 Section 5 of the Offence Act does not apply to this Act or the regulations.
159 Proceedings under this Act, other than an action referred to in section 140, must not be commenced more than 6 years after the date of the events that give rise to the proceedings.
160 (1) A person convicted of an offence against this Act or the regulations is liable, after the review and filing of a certificate under this section, for the costs of the investigation of the offence.
(2) The executive director may prepare a certificate setting out the costs of the investigation of an offence including the cost of the time spent by the executive director and the staff of the executive director and any fees paid to an expert, investigator or witness.
(3) The executive director may apply to a master or registrar of a court to review the certificate under the rules of court as if the certificate were a bill of costs, and on the review the master or registrar must review the costs and may vary them if the master or registrar considers that they are unreasonable or not related to the investigation.
(4) The tariff of costs in the rules of court does not apply to a certificate reviewed under this section.
(5) On the review, the master or registrar must take into account any fees already paid by the defendant under sections 13 (3) and 150 in respect of the same investigation.
(6) After review the certificate may be filed in the court in which the proceedings were heard and may be enforced against the person convicted as if it were an order of the court.
161 (1) If the commission or the executive director considers it to be in the public interest, the commission or the executive director, after a hearing, may order one or more of the following:
(a) that a person comply with or cease contravening, and that the directors and senior officers of the person cause the person to comply with or cease contravening,
(i) a provision of this Act or the regulations,
(ii) a decision, whether or not the decision has been filed under section 163, or
(iii) a bylaw, rule, or other regulatory instrument or policy or a direction, decision, order or ruling made under a bylaw, rule or other regulatory instrument or policy of a self regulatory body or exchange, as the case may be, that has been recognized by the commission under section 24;
(b) that
(i) all persons,
(ii) the person or persons named in the order, or
(iii) one or more classes of persons
cease trading in, or be prohibited from purchasing, a specified security or exchange contract or a specified class of securities or class of exchange contracts;
(c) that any or all of the exemptions described in any of sections 44 to 47, 74, 75, 98 or 99 do not apply to a person;
(d) that a person
(i) resign any position that the person holds as a director or officer of an issuer,
(ii) is prohibited from becoming or acting as a director or officer of any issuer, or
(iii) is prohibited from engaging in investor relations activities;
(e) that a registrant, issuer or person engaged in investor relations activities
(i) is prohibited from disseminating to the public, or authorizing the dissemination to the public, of any information or record of any kind that is described in the order,
(ii) is required to disseminate to the public, by the method described in the order, any information or record relating to the affairs of the registrant or issuer that the commission or the superintendent considers must be disseminated, or
(iii) is required to amend, in the manner specified in the order, any information or record of any kind described in the order before disseminating the information or record to the public or authorizing its dissemination to the public;
(f) that a registrant be reprimanded, that a person's registration be suspended, cancelled or restricted or that conditions be imposed on a registrant.
(2) If the commission or the executive director considers that the length of time required to hold a hearing under subsection (1), other than under subsection (1) (e) (ii) or (iii), could be prejudicial to the public interest, the commission or the executive director may make a temporary order, without a hearing, to have effect for not longer than 15 days after the date the temporary order is made.
(3) If the commission or the executive director considers it necessary and in the public interest, the commission or the executive director may, without a hearing, make an order extending a temporary order until a hearing is held and a decision is rendered.
(4) The commission or the executive director, as the case may be, must send written notice of every order made under this section to any person that is directly affected by the order.
(5) If notice of a temporary order is sent under subsection (4), the notice must be accompanied by a notice of hearing.
162 If the commission, after a hearing,
(a) determines that a person has contravened
(i) a provision of this Act or of the regulations, or
(ii) a decision, whether or not the decision has been filed under section 163, and
(b) considers it to be in the public interest to make the order
the commission may order the person to pay the commission an administrative penalty of not more than $100 000.
163 (1) If the commission has made a decision after a hearing, the commission may file the decision at any time in a Supreme Court registry by filing a copy of the decision certified by the chair of the commission.
(2) On being filed under subsection (1), a decision of the commission has the same force and effect, and all proceedings may be taken on it, as if it were a judgment of the Supreme Court.
164 (1) For the reasons set out in subsection (2), the commission or the executive director, without a hearing, may order that all persons, the person or persons named in the order or one or more specified persons or classes of persons cease trading in a specified security or exchange contract or in a class of security or class of exchange contract.
(2) The commission or the executive director may make an order under subsection (1) if the issuer of the security, the exchange on which the exchange contract is traded or the person in respect of which the order is made
(a) fails to file a record required to be filed under this Act or the regulations, provided that the order is revoked as soon as practicable after the record referred to in the order, completed in accordance with this Act and the regulations, is filed, or
(b) files a record required to be filed under this Act or the regulations which record has not been completed in accordance with this Act or the regulations, provided that the order is revoked as soon as practicable after the record referred to in the order, completed in accordance with this Act and the regulations, is filed.
(3) The commission or the executive director, as the case may be, must send to any person directly affected by an order made under subsection (1)
(a) written notice of the order, and
(b) written notice of a revocation of the order, if any.
165 (1) The executive director must notify the commission of every decision the executive director makes
(a) refusing registration of any person,
(b) suspending, terminating, restricting or imposing conditions on registration of any person,
(c) refusing to permit a distribution or additional distribution to proceed until a receipt for an amendment to a prospectus is issued,
(d) refusing to issue a receipt for a prospectus under section 65,
(e) ordering trading to halt under section 89,
(f) ordering trading to cease under section 164,
(g) refusing to exempt a person or class of persons under section 48 from registration requirements or under section 76 (1) from prospectus requirements, and
(h) under section 161,
at the same time as the executive director notifies the person directly affected by the decision.
(2) The commission may review a decision referred to in subsection (1) and, if it intends to do so, must, within 30 days of the date of the decision, notify the executive director and any person directly affected by the executive director's decision of its intention.
(3) Except if otherwise expressly provided, any person directly affected by a decision of the executive director may, by a notice in writing sent to the commission within 30 days after the date on which the executive director sent the notice of the decision to the person, request and be entitled to a hearing and a review of the decision of the executive director.
(4) On a hearing and review, the commission may confirm or vary the decision under review or make another decision it considers proper.
(5) The commission may grant a stay of the decision under review until disposition of the hearing and review.
(6) The executive director is a party to a hearing and review under this section of any decision.
(7) A designated organization is a party to a hearing and review under this section of its decision.
(8) A self regulatory body or exchange is a party to a hearing and review under this section of its decision.
166 (1) A designated organization and a person acting under authority delegated to the person by the commission under section 7 must immediately notify the commission and the executive director of every decision the organization or person makes, and section 165 (2) to (5) applies to that decision.
(2) A person referred to in subsection (1) must not sit on a hearing and review by the commission of the person's decision.
(3) The executive director may request and is entitled to a hearing and a review of a decision of a designated organization and section 165 (2) to (5) applies to that decision.
167 (1) A person directly affected by a decision of the commission, other than
(a) a decision under section 48 or 76,
(b) a decision under section 165 in connection with the review of a decision of the executive director under section 48 or 76, or
(c) a decision by a person acting under authority delegated by the commission under section 7,
may appeal to the Court of Appeal with leave of a justice of that court.
(2) The commission or the Court of Appeal may grant a stay of the decision appealed from until the disposition of the appeal.
(3) If an appeal is taken under this section, the Court of Appeal may direct the commission to make a decision or to perform an act that the commission is authorized and empowered to do.
(4) Despite an order of the Court of Appeal in a particular matter, the commission may make a further decision on new material or if there is a significant change in the circumstances, and that decision is also subject to this section.
(5) The commission is a party to an appeal under this section.
168 A statement concerning
(a) the registration or non-registration of a person under this Act or by the regulations,
(b) the filing or non-filing of a record or material required or permitted to be filed under this Act or the regulations,
(c) any other matter or information arising out of the registration or non-registration of a person or the filing or non-filing of a record or material, whichever is the case, or
(d) the date on which the facts on which any proceedings are to be based first came to the knowledge of the commission,
purporting to be certified by the commission, a member of it or the executive director is, without proof of the office or signature of the person certifying, admissible in evidence, so far as it is relevant, for all purposes in any action, proceeding or prosecution.
169 (1) Unless otherwise indicated, records required by this Act or by the regulations to be filed must be filed by depositing them with the commission.
(2) Subject to the regulations, records required by this Act or by the regulations to be filed may be filed electronically in any form specified by the executive director.
(3) Subject to subsection (4), all records filed under this Act or the regulations must be made available for public inspection during normal business hours.
(4) The commission may hold in confidence a record or any class of record required to be filed under this Act or the regulations so long as it considers that
(a) the record or class of record discloses intimate financial, personal or other information, and
(b) the desirability of avoiding disclosure of the information, in the interests of any person affected, outweighs the desirability of adhering to the principle of public disclosure.
170 (1) No action or other proceeding for damages lies and no application for judicial review under the Judicial Review Procedure Act may be instituted against the commission, a member of the commission, an officer, servant or agent of the commission, a designated organization, a member of a designated organization, an officer, servant or agent of a designated organization, an employee appointed to administer this Act or any person proceeding under
(a) an order, a written or oral direction or the consent of the commission, or
(b) an order of the minister made under this Act,
for any act done in good faith in the
(c) performance or intended performance of any duty, or
(d) exercise or the intended exercise of any power,
under this Act or the regulations, or for any neglect or default in the performance or exercise in good faith of that duty or power.
(2) No person has any remedies and no proceedings lie or may be brought against any person for any act done or omission made as a result of compliance with this Act, the regulations or any decision rendered under this Act or the regulations.
171 If the commission, the executive director or a designated organization considers that to do so would not be prejudicial to the public interest, the commission, executive director or designated organization, as the case may be, may make an order revoking in whole or in part or varying a decision the commission, the executive director or the designated organization, as the case may be, has made under this Act, the regulations, another enactment or a former enactment, whether or not the decision has been filed under section 163.
172 The commission or the executive director may impose any conditions the commission or executive director considers necessary in respect of any decision made by the commission or executive director.
173 The person presiding at a hearing required or permitted under this Act or the regulations
(a) has the same power that an investigator appointed under section 142 or 147 has under section 144,
(b) must receive all relevant evidence submitted by a person to whom notice has been given and may receive relevant evidence submitted by any person, and
(c) is not bound by the rules of evidence.
174 The person presiding at a hearing required or permitted under this Act or the regulations may order a person whose affairs are the subject of the hearing to pay prescribed fees or charges for the costs of or related to the hearing that are incurred by or on behalf of the commission or the executive director including, without limiting this,
(a) costs of matters preliminary to the hearing,
(b) costs for time spent by the commission or the executive director or the staff of either of them,
(c) fees paid to an expert or witness, and
(d) costs of legal services.
175 (1) On an application made by the commission, if it appears to the Supreme Court that a person outside British Columbia may have evidence that may be relevant to
(a) an investigation ordered by the commission under section 142, or
(b) a hearing required or permitted under this Act or the regulations,
the Supreme Court may issue a letter of request directed to the judicial authority of the jurisdiction in which the person to be examined is believed to be located.
(2) The letter of request referred to in subsection (1) must
(a) be signed by the judge hearing the application or another judge of the Supreme Court, and
(b) be provided to the commission for disposition under subsection (5).
(3) A letter of request issued under subsection (1) may request the judicial authority to which it is directed to
(a) order the person referred to in the letter of request to be examined under oath in the manner, at the place and by the date referred to in the letter of request,
(b) order, in the case of an examination for the purposes of a hearing referred to in subsection (1) (b), that a person who is a party to the hearing is entitled to
(i) be present or represented by counsel during the examination, and
(ii) examine the person referred to in paragraph (a),
(c) appoint a person as the examiner to conduct the examination,
(d) order the person to be examined to produce at the examination the records and things or classes of records and things specified in the letter of request,
(e) direct that the evidence obtained by the examination be recorded and certified in the manner specified by the letter of request, and
(f) take any further or other action that the Supreme Court considers appropriate.
(4) The failure of the person entitled under subsection (3) (b) to be present or represented by counsel during the examination or to examine the person referred to in subsection (3) (a) does not prevent the commission from reading in the evidence at the hearing if the examination has otherwise been conducted in accordance with the order made under that subsection.
(5) The commission must send the letter of request,
(a) if the examination is to be held in Canada, to the Deputy Attorney General for the Province of British Columbia, or
(b) if the examination is to be held outside Canada, to the Under Secretary of State for External Affairs of Canada.
(6) The letter of request must have attached to it
(a) any interrogatories to be put to the person to be examined,
(b) if known, a list of the names, addresses and telephone numbers of
(i) the solicitors or agents of the commission,
(ii) the person to be examined, and
(iii) if applicable, the person entitled under subsection (3) (b) to be present or represented by counsel during the examination and to examine the person referred to in paragraph (3) (a),
both in British Columbia and in the other jurisdiction, and
(c) a translation of the letter of request and any interrogatories into the appropriate official language of the jurisdiction where the examination is to take place, along with a certificate of the translator, bearing the full name and address of the translator, that the translation is a true and complete translation.
(7) The commission must file with the Under Secretary of State for External Affairs of Canada or with the Deputy Attorney General for the Province of British Columbia, as the case may be, an undertaking to be responsible for all of the charges and expenses incurred by the Under Secretary or the Deputy Attorney General, as the case may be, in respect of the letter of request and to pay them on receiving notification of the amount.
(8) This section does not limit any power the commission may have to obtain evidence outside British Columbia by any other means.
(9) The making of an order by a judicial authority referred to in subsection (1) pursuant to a letter of request issued under that subsection does not determine whether evidence obtained under the order is admissible in evidence in a hearing before the commission.
(10) Except if otherwise provided by this section, the practice and procedure in connection with appointing a person, conducting an examination and certifying and returning the appointment under this section, as far as possible, are the same as those that govern similar matters in civil proceedings in the Supreme Court.
176 (1) In this section, "qualifying letter of request" means a letter of request that
(a) is issued by a court or tribunal of competent jurisdiction in a jurisdiction other than British Columbia,
(b) is issued on behalf of the body that is, in the jurisdiction from which the letter is issued, empowered by the laws of that jurisdiction to administer or regulate the trading of securities or exchange contracts in that jurisdiction,
(c) is issued in relation to
(i) a matter under investigation by the body referred to in paragraph (b), or
(ii) a matter that is the subject of a hearing before the body referred to in paragraph (b), and
(d) requests that evidence in relation to a matter referred to in paragraph (c) be obtained from a person believed to be located in British Columbia.
(2) On receipt of a qualifying letter of request, the Supreme Court may make the order it considers appropriate and may, without limitation,
(a) order that the person referred to in subsection (1) (d) be examined under oath in the manner, at the place and by the date requested by the foreign court or tribunal,
(b) order, in the case of an examination for the purposes of a hearing referred to in subsection (1) (c) (ii), that a person who is a party to the hearing is entitled to
(i) be present or represented by counsel during the examination, and
(ii) examine the person referred to in paragraph (a),
(c) appoint a person as the examiner to conduct the examination,
(d) order that the person referred to in subsection (1) (d) produce at the examination any records and things or classes of records and things specified in the request,
(e) direct that the evidence obtained by the examination be recorded and certified in the manner requested, and
(f) make any further or other order that the Supreme Court considers appropriate.
(3) An order under subsection (2) may be enforced in the same manner as if the order were made in or in respect of a proceeding brought in the Supreme Court and, if the person referred to in subsection (1) (d) fails without lawful excuse to comply with the order, the person is in contempt of the Supreme Court and is subject to the penalty that the Supreme Court imposes.
(4) A person ordered to give evidence under subsection (2) has the same rights
(a) to receive conduct money or any other money that the person would have had if the examination were held in relation to a proceeding in the Supreme Court, and
(b) to refuse to answer questions and produce records and things or classes of records and things that the person would have in a proceeding in the Supreme Court.
(5) The person appointed by the Supreme Court as the examiner has the authority to administer an oath or affirmation to the person to be examined.
(6) Except if otherwise provided by this section, the practice and procedure in connection with appointing a person, conducting an examination and certifying and returning the appointment under this section, as far as possible, are the same as those that govern similar matters in civil proceedings in the Supreme Court.
177 On application by the commission to the Supreme Court, a person is liable to be committed for contempt as if the person were in breach of an order or judgment of the Supreme Court, if the person's conduct in, or in relation to, a hearing required or permitted under this Act would be a contempt of the Supreme Court if done in, or in relation to, a hearing of that court.
178 If
(a) an application for registration or renewal or reinstatement of registration is abandoned, or
(b) a prospectus or similar record is withdrawn, the executive director may, on application of an affected person, refund the fee or part of the fee paid in accordance with section 16 of the Financial Administration Act.
179 (1) If a person is ordered to pay prescribed fees or prescribed charges for the costs of, or related to,
(a) an examination or investigation by a person appointed under section 13,
(b) a review under section 29 or 39,
(c) an investigation, examination or inspection under Part 17, or
(d) a hearing required or permitted under this Act or the regulations,
the person ordered to pay the fees or charges may apply within 30 days after the date of the order to a master or registrar of the Supreme Court to review the order.
(2) On a review under this section, the master or registrar may vary the total amount of the fees and charges, within the limits, if any, set out in the regulations, after considering all of the circumstances, including
(a) the complexity, difficulty or novelty of the issues involved,
(b) the skill, specialized knowledge and responsibility required of the person or persons who conducted the examination, review, investigation, inspection or hearing referred to in subsection (1) (a) to (d),
(c) the total amount of the fees and charges set out in the order referred to in subsection (1), and
(d) the time reasonably expended.
(3) On application for a review under this section of an order to pay prescribed fees or prescribed charges, the applicant must give notice of the application to the maker of the order that is to be reviewed.
(4) The Supreme Court Rules relating to taxation of costs apply to a review of the total amount of fees and charges made under this section.
180 (1) Unless otherwise provided by this Act or ordered by the commission or executive director, a record that under this Act or the regulations is sent or is required to be sent must be
(a) personally delivered,
(b) mailed, or
(c) transmitted by electronic means
to the person that under this Act or the regulations is the intended recipient of the record.
(2) A record sent to a person by means referred to in subsection (1) (b) or (c) must be sent to that person
(a) at the latest address known for that person by the sender of the record, or
(b) at the address for service in British Columbia filed by that person with the commission.
(3) A record is deemed to have been personally delivered to the commission if the record is deposited at the office of the commission during normal business hours.
(4) A record is deemed to have been received by the person to whom it was sent
(a) if mailed by ordinary mail, on the seventh day after mailing, or
(b) if mailed by registered mail, on the earlier of the seventh day after mailing or the day its receipt was acknowledged in writing by the person to whom it was sent or by a person accepting it on that person's behalf.
(5) If, on 3 consecutive occasions, the records sent by an issuer to a security holder in accordance with subsection (2) are returned, the issuer is not required to send any further records to the security holder until the security holder informs the issuer in writing of the security holder's new address.
181 Unless the context indicates otherwise, a reference to a specific record includes a reference to any amendment, variation or modification of it that is permitted or required under this Act or the regulations.
182 (1) Subject to the further requirements of this Act or the regulations, if this Act or the regulations provide that a record is to be prepared, filed, provided or sent in a required form, the executive director may specify the form, content and other particulars relating to the record including specifying
(a) the principles to be applied in its preparation, and
(b) accompanying records to be filed with it.
(2) If this Act or the regulations provide that a record is to prepared, filed, provided or sent in a required form, the executive director may, for different classes of a particular kind of record, specify a different form, content and other particulars relating to the record including specifying
(a) the principles to be applied in its preparation, and
(b) accompanying records to be filed with it.
183 The Lieutenant Governor in Council may make regulations for the purpose of regulating trading in securities or exchange contracts, or regulating the securities industry or exchange contracts industry, including regulations as follows:
(1) regulating the listing and trading of securities, and the trading of exchange contracts, on an exchange recognized by the commission under section 24 (2);
(2) regulating the trading of securities and exchange contracts other than on an exchange recognized by the commission under section 24 (2);
(3) governing conflict of interest for members of the commission, its employees, the executive director, employees in the office of the executive director and persons engaged by the commission or the executive director to act as advisers or to perform duties under this Act, the regulations or the commission rules;
(4) requiring the commission to publish a periodical containing specified information filed with the commission;
(5) providing for the referral of a question of policy or interpretation to the commission for a hearing and determination;
(6) respecting registration under this Act including, but not limited to, prescribing
(i) categories for persons for purposes of registration and otherwise,
(ii) the duration of registration, and permitting the commission to determine the duration of registration and to determine different periods of duration of registration for different categories of registrants,
(iii) the manner of allocating persons to categories, and permitting the executive director to make these allocations,
(iv) conditions to be met by persons in the categories,
(v) standards of conduct to be met by registrants and practices to be carried out by registrants, and
(vi) requirements that are necessary or advisable for the prevention or regulation of conflicts of interest;
(7) authorizing the executive director to require an applicant for registration or a registrant to be bonded;
(8) respecting the suspension or cancellation of a registration under this Act;
(9) governing trust arrangements for the holding of securities and funds of a client by a registrant;
(10) prescribing the practice and procedure by which the executive director designates exempt purchasers under sections 45 and 74;
(11) respecting the transfer and pledging of securities or the transfer of exchange contracts;
(12) respecting annual information forms, prospectuses, preliminary prospectuses, pro forma prospectuses, simplified prospectuses and preliminary prospectuses and summary statements including amending, modifying or varying this Act as may be necessary for the purpose of permitting the use of annual information forms, pro forma prospectuses, simplified prospectuses and preliminary prospectuses;
(13) in relation to disclosure documents,
(i) respecting their use in connection with any distribution made in the circumstances described in section 74 (2) or with any distribution referred to in section 75, and
(ii) governing their form and content including, without limiting this power, requiring content that has the effect of conferring on each purchaser under the distribution a contractual right of action, a contractual right of withdrawal from an agreement of purchase and sale, or both;
(14) prescribing the circumstances under which a class or classes of trades of securities, acquired under an exemption from section 61 granted under this Act, the regulations or the commission rules, are deemed to be a distribution;
(15) respecting the lapse date of a prospectus and the continuation of a distribution under a new prospectus including, without limiting this,
(i) prescribing the terms and conditions under which a distribution may be continued after the lapse date,
(ii) prescribing the circumstances in which cancellation rights are available to certain purchasers after the lapse date,
(iii) authorizing the executive director to order an extension of the prescribed period of time within which a distribution may be continued after the lapse date, and
(iv) prescribing the terms and conditions under which a new prospectus may be receipted;
(16) prescribing terms that must be contained in an escrow or pooling agreement with respect to securities issued for consideration other than cash;
(17) respecting any matter necessary or advisable to regulate exchange issuers;
(18) prescribing the information required or permitted to be distributed under section 78 (2);
(19) respecting any matter necessary or advisable to carry out effectively the intent and purpose of Part 12, including, but not limited to,
(i) requiring any issuer or class of issuers to comply with Part 12 or any provision of it,
(ii) prescribing how a security or class of securities, including a put, call, option or other right or obligation to purchase or sell securities of a reporting issuer, must be reported in an insider report filed under section 87, and
(iii) prescribing standards for determining when a material fact or material change has been generally disclosed;
(20) respecting any matter necessary or advisable to carry out effectively the intent and purpose of section 136, including, but not limited to,
(i) exempting any class of persons, trades, securities or exchange contracts from liability under section 136,
(ii) prescribing circumstances and conditions for the purpose of an exemption under subparagraph (i), and
(iii) prescribing standards for determining when a material fact or material change has been generally disclosed;
(21) respecting any matter necessary or advisable to carry out effectively the intent and purpose of Part 13, including, but not limited to,
(i) restricting any exemption set out in sections 98 and 99 or 101 to 104,
(ii) prescribing requirements in addition to those set out in section 105 and varying any requirement set out in that section,
(iii) prescribing requirements relating to the conduct or management of the affairs of an offeree issuer during or in anticipation of a take over bid, and
(iv) prescribing the form and content of any circular, report or other document required to be delivered or filed;
(22) respecting any matter necessary or advisable to carry out effectively the intent and purpose of Part 14, including, but not limited to,
(i) prescribing requirements for the solicitation and voting of proxies, and
(ii) prescribing requirements relating to communication with registered holders or beneficial owners of securities and relating to other persons, including depositories and registrants, that hold securities on behalf of beneficial owners;
(23) respecting any matter necessary or advisable to regulate mutual funds or non-redeemable investment funds, including commodity pools, and the distribution and trading of the securities of the funds, including, but not limited to,
(i) prescribing disclosure requirements in respect of funds, including the use of particular forms or of particular types of documents,
(ii) prescribing permitted investment policy and investment practices for the funds and prohibiting or restricting certain types of investments or investment practices for the funds,
(iii) prescribing requirements governing the custodianship of assets for funds,
(iv) prescribing matters requiring approval of the security holders of the funds, the commission or the executive director, and defining for specified types of matters what constitutes approval by the security holders,
(v) respecting fees, commissions or compensation payable by a fund, a purchaser of securities of a fund or a holder of securities of a fund relating to
(A) sales charges, commissions or sales incentives, and
(B) investment advice or administrative or management services provided to the fund,
(vi) prescribing procedures relating to
(A) sales and redemptions of fund securities, and
(B) payments for sales and redemptions, and
(vii) designating a mutual fund or a class of mutual funds as a private mutual fund or class of private mutual funds, as the case may be;
(24) prescribing the principles for determining the market value, market price or closing price of a security or exchange contract, or the net asset value of a security, and authorizing the commission to make that determination;
(25) prescribing standards in relation to the suitability for certain investors of certain securities and exchange contracts;
(26) prescribing the practice and procedure for investigations, examinations or inspections under Part 17;
(27) establishing fees and charges, or limits on fees and charges, for the purpose of Part 17 or of section 13, 29, 39 or 174;
(28) prescribing those decisions made under the regulations or the commission rules that are to be subject to an appeal under Part 19;
(29) prescribing the rules and procedure to be followed in any hearing required or permitted by this Act;
(30) providing for the collection by a designated organization of fees payable to the commission or executive director and for their remission to the commission or executive director;
(31) determining what constitutes approval of a person's records for which approval is required under this Act, the regulations or the commission rules;
(32) incorporating by reference and adopting codes and standards as they are amended from time to time before or after the making of the regulations;
(33) governing the providing or distribution of information or records by a person, including the commission and the executive director, or class of persons to any person, including the commission and the executive director, the payment of fees for providing that information or records and including authorizing the executive director to regulate and control the use of advertising and sales literature for securities or exchange contracts;
(34) respecting the keeping and providing of accounts and records, and the preparation, filing and providing or distributing of financial statements, annual reports and other records by any person or class of persons;
(35) prescribing the fees payable in connection with the administration of this Act, the regulations or the commission rules or the activities carried out by the commission or the executive director under another enactment or a policy statement;
(36) authorizing the commission to recognize an exchange for any purpose under this Act, the regulations or the commission rules;
(37) authorizing the commission or the executive director to vary the provisions of the regulations, excluding regulations made under paragraph (3), as they apply to any person, trade, security or exchange contract or class of persons, trades, securities or exchange contracts;
(38) providing that any or all of the exemptions in this Act, the regulations or the commission rules do not apply to a class of persons, trades, securities or exchange contracts, and prescribing circumstances in which or conditions on which the exemption is or the exemptions are disapplied under this paragraph;
(39) authorizing the commission or the executive director to order that any or all of the exemptions in this Act or the regulations do not apply to a particular person, trade, security or exchange contract or class of persons, trades, securities or exchange contracts;
(40) exempting a class of persons, trades, securities or exchange contracts from one or more of the provisions of Parts 4, 5, 7, 8, 9, 11, 12, 13, 14 and 15, of the regulations relating to any of those Parts or of the commission rules relating to any of those Parts;
(41) prescribing circumstances and conditions for the purpose of an exemption under paragraph (40);
(42) authorizing the commission or the executive director to order that any or all of the provisions of this Act or the regulations, excluding regulations made under paragraph (3), do not apply to a particular person, trade, security or exchange contract or class of persons, trades, securities or exchange contracts;
(43) respecting those matters for which this Act provides that regulations or commission rules be made or requirements prescribed;
(44) respecting the filing of records under this Act, the regulations and the commission rules;
(45) respecting
(i) the amendment or modification of a record and the effect of that amendment or modification,
(ii) the use of codes and symbols for the identification of persons on records,
(iii) the use of records, prepared in accordance with similar laws of another jurisdiction, to satisfy the requirements of this Act, the regulations or the commission rules,
(iv) the certification of a record required in this Act, and
(v) the filing of records by electronic means;
(46) defining words and expressions used but not defined in this Act;
(47) to meet any difficulties that may arise by reason of the repeal of the Securities Act, R.S.B.C. 1979, c. 380, and the substitution of this Act;
(48) for the purpose of section 155 (1) (f), specifying provisions of the regulations, the contravention of any of which constitutes an offence under section 155 (1) (f);
(49) for the purpose of section 155 (1) (g), specifying provisions of the commission rules, the contravention of any of which constitutes an offence under section 155 (1) (g);
(50) governing the procedures that are to be followed by the commission in making and repealing commission rules including, but not limited to, prescribing requirements with which the commission must comply before depositing a commission rule with the registrar of regulations;
(51) prescribing a regulation made by the Lieutenant Governor in Council under this Act to be a commission rule;
(52) amending or repealing any commission rule.
184 (1) Subject to subsections (4) to (7), the commission may make rules for the purpose of regulating trading in securities or exchange contracts, or regulating the securities industry or exchange contracts industry.
(2) Without limiting subsection (1) but subject to subsections (4) to (7), the commission may make rules as follows:
(a) respecting those matters for which this Act provides that commission rules be made;
(b) respecting those matters for which this Act provides that requirements be prescribed, except for those matters referred to in sections 13 (3), 29 (5), 34 (2), 35 (1) (b), 39 (5), 143 (4), 150, 153 (4), 174, 179 (1) and (3), 183 (50) and (51) and subsections (5) to (8) of this section;
(c) with respect to the same matters with respect to which the Lieutenant Governor in Council may make regulations under section 183 (1), (2), (6) to (25), (30), (31), (33), (34), (36), (38), (40), (41), (44) and (45) and to the same extent;
(d) incorporating by reference and adopting codes and standards as they are amended from time to time before or after the making of the rules;
(e) authorizing one or more organizations, on specified terms and conditions, to exercise any of the executive director's powers under Part 5 or to perform any of the executive director's duties under Part 5, including, but not limited to, the power
(i) to grant, renew or reinstate registration, to refuse to grant, renew or reinstate registration or to attach terms, conditions or restrictions to any grant, renewal or reinstatement of registration,
(ii) to suspend or cancel registration,
(iii) to satisfy itself of any matter that is a condition precedent to the exercise of a power it is authorized under this paragraph to exercise,
(iv) to require an applicant or registrant to submit to examination under oath, and
(v) to require delivery of a bond;
(f) establishing criteria to be applied and procedures to be followed by a designated organization in making a direction, decision, order or ruling it is authorized under paragraph (e) to make;
(g) requiring
(i) applications for registration or for renewal or reinstatement of registration to be made to a designated organization, and
(ii) any notification referred to in section 42 or any other thing to be delivered to the designated organization;
(h) requiring a designated organization
(i) to provide the executive director with reports and information respecting any matter that is before the designated organization or any decision made by it under an authority given to it under paragraph (e),
(ii) to notify applicants, registrants or other persons of registrations granted or decisions made by the designated organization under an authority given to it under paragraph (e), and
(iii) to keep records, including records of decisions made by the designated organization under an authority given to it under paragraph (e) and to permit public inspection of classes of records specified by the commission;
(i) empowering a designated organization to delegate any power or duty conferred on it under paragraph (e) to a committee of the designated organization, and deeming the decisions of the committee to be the decisions of the designated organization;
(j) respecting the custody and use of the executive director's seal of office and of any device for affixing a facsimile of the executive director's signature.
(3) If a designated organization is exercising or intends to exercise a power provided to it under subsection (2) (e) to make a decision, the commission may withdraw from the designated organization any matter that is before the designated organization for its decision, and the commission may refer the matter to the executive director for decision.
(4) Unless the power to do so is expressly provided to the commission under this section, the commission must not make rules under this section with respect to the matters with respect to which the Lieutenant Governor in Council may make regulations under section 183 (3) to (5), (26) to (29), (32), (35), (37), (39), (42), (43) and (46) to (52).
(5) The commission must, before making or repealing a rule under this section, obtain the consent of the minister in accordance with the regulations and comply with any other prescribed procedures and requirements.
(6) Without limiting subsection (5), the commission must not deposit with the registrar of regulations any rule made by the commission under this section unless the commission has complied with the prescribed procedures and requirements.
(7) Despite subsections (5) and (6), the commission may deposit with the registrar of regulations a rule made by the commission under this section without complying with the prescribed procedures and requirements if
(a) the commission considers it necessary and in the public interest to deposit the rule without delay, and
(b) the minister consents
(i) to the making of the rule, and
(ii) to the rule being deposited without the commission's compliance with the prescribed procedures and requirements.
(8) Unless earlier revoked, a rule made under subsection (7) is revoked on the day that is the prescribed number of days following the day on which the rule is deposited with the registrar of regulations.
(9) The Lieutenant Governor in Council may, by regulation, designate a regulation made under section 183, whether made before or after the coming into force of this section, to be a rule of the commission and the designated regulation is deemed for all purposes to be a rule of the commission made under this section.
(10) The Lieutenant Governor in Council may, by regulation, repeal or amend any of the rules made by the commission under this section.
185 The Regulations Act applies to a commission rule.
186 If a commission rule conflicts with a regulation made by the Lieutenant Governor in Council under section 183, the regulation prevails.
187 The commission may
(a) vary the provisions of the commission rules as they apply to any person, trade, security or exchange contract or class of persons, trades, securities or exchange contracts,
(b) order that any or all of the exemptions in the commission rules do not apply to a person, trade, security or exchange contract or class of persons, trades, securities or exchange contracts,
(c) order that any or all of the provisions of the commission rules do not apply to a person, trade, security or exchange contract or class of persons, trades, securities or exchange contracts, and
(d) authorize the executive director to exercise a power given to the commission under paragraphs (a) to (c).
188 (1) The commission may issue policy statements, and other instruments the commission considers advisable, to facilitate the exercise of its powers and the performance of its duties under this Act, the regulations and the commission rules.
(2) A policy statement or other instrument referred to in subsection (1) is not a commission rule or a regulation within the meaning of the Regulations Act.