CALGARY, Nov. 22, 2018 /CNW/ - The Alberta Securities Commission (ASC) has adopted an initiative to facilitate access to capital for community economic development corporations (CEDCs).
Blanket Order 45-520 Facilitating Access to Capital for Community Economic Development Corporations (the Blanket Order) offers CEDCs a new, limited exemption to the financial statement requirements of the offering memorandum prospectus exemption (OM exemption). The Blanket Order is effective immediately.
"The Blanket Order is designed to advance the CEDC program by reducing costly financial reporting obligations for small, community businesses, facilitating their access to capital, while at the same time continuing to provide investor protection," said Stan Magidson, Chair and Chief Executive Officer of the ASC.
The CEDC program is a product of the Investing in a Diversified Alberta Economy Act, which provides a tax credit to investors in businesses that have community economic development or social impact within their local community. The Blanket Order allows a CEDC using the OM exemption to prepare its financial statements in accordance with generally accepted accounting principles (GAPP) for private enterprises instead of GAAP for publicly accountable enterprises. A CEDC can also have those financial statements reviewed instead of audited. Issuers relying on the Blanket Order:
- Can raise a maximum of $5,000,000.
- Must obtain an enhanced risk warning from investors.
- Must limit the amount investors can invest, i.e., unless an individual meets specified income or asset tests, the maximum they could invest in CEDCs would be $5,000.
The ASC is the regulatory agency responsible for administering the province's securities laws. It is entrusted with fostering a fair and efficient capital market in Alberta and with protecting investors. As a member of the Canadian Securities Administrators, the ASC works to improve, coordinate and harmonize the regulation of Canada's capital markets.
SOURCE Alberta Securities Commission
For further information: For Media Inquiries: Hilary McMeekin, Manager, Communications, 403.592.8186; For Investor Inquiries: ASC Public Inquiries, Toll Free 1.877.355.4488