Securities Passport System Implemented

    Regulators Introduce Streamlined Review Policies for Passport
    Jurisdictions and Ontario

    VANCOUVER, Jan. 25 /CNW/ - Today, the Canadian Securities Administrators
(CSA) published a notice to implement the next phase of the passport system -
a regulatory framework designed to provide market participants with
streamlined access to Canada's capital markets. The notice introduces a new
rule and review policies that outline how the system will work in
participating passport jurisdictions and how market participants will
interface with Ontario.
    "The passport rule together with the national policies will simplify the
regulatory approval process and benefit businesses and investors in all
provinces and territories," said Jean St-Gelais, Chair of the CSA and
President & Chief Executive Officer of the Autorité des marchés financiers
(Québec). "This phase of passport will give issuers access to Canada's capital
markets by allowing them to deal with only one regulator and one set of
harmonized requirements."
    The new rule, Multilateral Instrument 11-102 Passport System, is
scheduled to take effect in the passport jurisdictions on March 17, 2008. The
rule will allow someone to clear a prospectus or obtain a discretionary
exemption from their home regulator, and have that clearance or exemption
apply automatically in all other passport provinces and territories. It
represents a major step toward meeting the commitments set out in the
September 30, 2004 memorandum of understanding regarding securities regulation
among the governments of all provinces and territories, except Ontario.
    The new policies, National Policy 11-202 Process for Prospectus Review in
Multiple Jurisdictions and National Policy 11-203 Process for Exemptive Relief
Application Reviews in Multiple Jurisdictions, set out the processes for the
filing and review of prospectuses and exemptive relief applications. These
policies will replace and streamline the current mutual reliance review
systems for prospectuses and exemptive relief applications. The policies also
outline how market participants in passport jurisdictions will gain access to
the Ontario market. They are scheduled to take effect in all provinces and
territories on March 17, 2008.
    The foundation for the passport system is a set of harmonized regulatory
requirements consistently interpreted and applied throughout Canada. For that
reason, the passport for prospectuses is coming into force at the same time as
the CSA's National Instrument 41-101 General Prospectus Requirements. The CSA
now plans to proceed with passport for registration as it finalizes the
proposed new national rule for registration requirements (National Instrument
    The instrument, policies and other related documents are available on
various CSA members' websites.

    The CSA, the council of the securities regulators of Canada's provinces
and territories, co-ordinates and harmonizes regulation for the Canadian
capital markets.

         Passport System for Prospectuses and Exemption Applications

    What is passport?     -  A system that gives a market participant access
                             to markets in all passport jurisdictions - every
                             province and territory in Canada, except Ontario
                             - by dealing only with its principal regulator
                             and complying with one set of harmonized laws

    How does it work?     -  Each market participant has a principal

                          -  A market participant can clear a prospectus or
                             obtain an exemption in all passport
                             jurisdictions through its principal regulator

                          -  Market participants are subject to harmonized
                             prospectus and continuous disclosure
                             requirements in all jurisdictions

    What are the          -  Simpler - need only one passport decision -
    benefits of              comply with one set of harmonized laws
                          -  Faster - deal with one passport regulator

                          -  Cheaper - eliminate professional costs for
                             dealing with multiple regulators and different

    What does it mean     -  Ontario has not adopted the passport rule
    for Ontario market
    participants?         -  Ontario market participants have direct access
                             to the markets in other jurisdictions by dealing
                             only with the Ontario Securities Commission

                          -  Other market participants gain access to the
                             Ontario market through a streamlined interface


    An issuer filing a prospectus in multiple jurisdictions will

    -   need to comply with harmonized prospectus requirements

    -   have its prospectus reviewed by only its principal regulator

    -   need a receipt for the prospectus from only its principal regulator

    -   get a deemed receipt in passport jurisdictions

    Issuers outside Ontario will also need to have their prospectuses reviewed
and receipted by the OSC

    Discretionary exemptions

    A market participant that needs a discretionary exemption in multiple
jurisdictions will

    -   file an application with its principal regulator

    -   have its application reviewed by only its principal regulator

    -   need a decision from only its principal regulator

    -   have an automatic exemption in passport jurisdictions

    Market participants outside Ontario will also need to file an application
with, and have it reviewed and approved by, the OSC

    Continuous disclosure

    An issuer that is a reporting issuer in multiple jurisdictions will

    -   need to comply with harmonized continuous disclosure requirements

    -   have any continuous disclosure exemption granted to it under the
        principal regulator system (MI 11-101) grandfathered


    Passport for registration is expected to proceed once the national rule
on registration requirements (NI 31-103) is finalized

    To arrange interviews with CSA Chair Jean St-Gelais, please contact

    Frédéric Alberro
    Autorité des marchés financiers
    (514) 940-2176

    For more information:

    Alberta Securities Commission
    Mark Dickey
    1-877-355-0585 (toll free)

    British Columbia Securities Commission
    Andrew Poon
    1-800-373-6393 (BC & Alberta only)

    Saskatchewan Financial Services Commission
    Barbara Shourounis

    Manitoba Securities Commission
    Ainsley Cunningham
    1-800-655-5244 (Manitoba only)

    Ontario Securities Commission
    Laurie Gillett

    Autorité des marchés financiers
    Frédéric Alberro
    1 877 395-0558,  No.  2176 (Québec only)

    New Brunswick Securities Commission
    Jane Gillies
    1-866-933-2222 (New Brunswick only)

    Nova Scotia Securities Commission
    Nick Pittas

    Financial Services Regulation Division
    Newfoundland and Labrador
    Doug Connolly

    Department of Attorney General
    Prince Edward Island
    Mark Gallant

    Nunavut Securities Registry
    Louis Arki

    Securities Registry
    Northwest Territories
    Donald MacDougall

    Yukon Securities Registry
    Fred Pretorius

For further information:

For further information: Please see above.

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