Canadian Securities Regulators Release Proposals in Response to the 2007-08 Credit Market Turmoil and its Effect on the ABCP Market in Canada

    TORONTO, Oct. 6 /CNW/ - The Canadian Securities Administrators (CSA)
today issued a Consultation Paper outlining several securities regulatory
proposals related to the Canadian non-bank sponsored asset-backed commercial
paper (ABCP) market.
    Shortly after events in international credit markets led to a seizure of
the non-bank sponsored portion of the ABCP market in Canada, the CSA took a
number of immediate steps, which included the formation of an ABCP working
group to address securities regulatory issues stemming from the credit market
turmoil. Those issues are examined in the CSA Consultation Paper.
    "In the process of developing these proposals, we considered numerous
complex issues, worked with international securities organizations, and
closely monitored international developments," said Jean St-Gelais, Chair of
the CSA and President and Chief Executive Officer of the Autorité des marchés
financiers (Québec). "We believe that the proposals reflect a measured
regulatory response that address our investor protection mandate and are
appropriate for the Canadian marketplace."

    The CSA Consultation Paper contains proposals and solicits comments on a
number of questions related to the proposals for:

    1.  Implementing a regulatory framework applicable to credit rating
        agencies that would require compliance with the recently amended code
        of conduct established by the International Organization of
        Securities Commissions (IOSCO). In addition, the CSA is considering
        requiring public disclosure of all information provided by an issuer
        that is used by a credit rating agency in rating an asset backed

    2.  Amending the short-term debt exemption to make it unavailable for
        sales of asset-backed short-term debt including ABCP. This would
        require issuers who sell these products to do so by way of
        prospectus, or under another exemption;

    3.  Reducing reliance on the use of credit ratings in securities

    4.  Addressing the roles played by dealers and advisers with respect to
        ABCP; and

    5.  Reviewing specific issues regarding mutual fund investments in ABCP.

    The CSA continues to work closely with the international community, and
is an active participant in two IOSCO task forces dealing with matters
relating to the credit market turmoil. The CSA also continues to monitor
international developments, including initiatives led by the U.S. Securities
and Exchange Commission, the Committee of European Securities Regulators, the
Financial Stability Forum and the U.S. President's Working Group on Financial
    The Consultation Paper, which is available on the CSA website at, as well as the websites of various CSA members, is open for
public comment for 75 days. The comment period closes on December 20, 2008.
    The CSA, the council of the securities regulators of Canada's provinces
and territories, co-ordinates and harmonizes regulation for the Canadian
capital markets.

For further information:

For further information: Laurie Gillett, Ontario Securities Commission,
(416) 595-8913; Ainsley Cunningham, Manitoba Securities Commission, (204)
945-4733; Sylvain Théberge, Autorité des marchés financiers, (514) 940-2176;
Wendy Connors-Beckett, New Brunswick Securities Commission, (506) 643-7745;
Ken Gracey, British Columbia Securities Commission, (604) 899-6577; Natalie
MacLellan, Nova Scotia Securities Commission, (902) 424-8586; Mark Dickey,
Alberta Securities Commission, (403) 297-4481; Barbara Shourounis,
Saskatchewan Financial Services Commission, (306) 787-5842; Marc Gallant,
Department of the Attorney General, Prince Edward Island, (902) 368-4552; Doug
Connolly, Financial Services Regulation Div., Newfoundland and Labrador, (709)
729-2594; Fred Pretorius, Yukon Securities Registry, (867) 667-5225; Louis
Arki, Nunavut Securities Registry, (867) 975-6587; Donald MacDougall,
Securities Registry, Northwest Territories, (867) 920-8984

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