{"id":1643,"date":"2009-04-28T00:00:00","date_gmt":"2009-04-28T00:00:00","guid":{"rendered":"https:\/\/perlaw.ca\/2009\/04\/28\/will-the-proposed-new-insider-reporting-rules-affect\/"},"modified":"2019-07-24T19:31:04","modified_gmt":"2019-07-24T19:31:04","slug":"will-the-proposed-new-insider-reporting-rules-affect","status":"publish","type":"post","link":"https:\/\/perlaw.ca\/fr\/2009\/04\/28\/will-the-proposed-new-insider-reporting-rules-affect\/","title":{"rendered":"Will the Proposed New Insider Reporting Rules Affect You?"},"content":{"rendered":"

The Canadian Securities Administrators have recently published a new proposed National Instrument 55-104 – Insider Reporting Requirements and Exemptions<\/em> (\u201cNI 55-104<\/strong>\u201d) to replace a number of instruments that currently govern insider reporting.\u00a0 The proposed NI 55-104 will contain the main insider reporting requirements and exemptions for insiders or reporting issuers, except in Ontario, where the main insider reporting requirements will remain in the Ontario Securities Act<\/em>.\u00a0 Despite this difference, insider reporting obligations will be substantially the same in all Canadian jurisdictions.<\/p>\n

The proposed NI 55-104 contains some significant changes from current insider reporting requirements.\u00a0 A few of these changes are briefly described below.<\/p>\n

A reduction in the number and type of persons required to file insider reports.\u00a0 One of the main objectives of the proposed NI 55-104 is to focus the insider trading reporting obligations on a smaller group of senior insiders who have the greatest access to material undisclosed information.\u00a0 Under this new concept, reporting insiders will include parties who are considered insiders under the current regime and significant shareholders who in the ordinary course have access to material undisclosed information about the reporting issuer and directly or indirectly do or have the ability to exercise significant power or influence over the business operations, capital or development of the reporting issuer.<\/p>\n

Shorter filing deadlines for most insider reports.\u00a0 Under the current insider reporting regime, changes in insider\u2019s beneficial ownership of securities must be reported within ten calendar days of the transaction.\u00a0 The proposed NI 55-104 will continue to require the filing of an initial insider report within ten days, however, subsequent reports of transactions by insiders must be reported within five days<\/p>\n

Simpler reporting obligations for stock based compensation arrangements.\u00a0 \u00a0\u00a0The proposed NI 55-104 introduces the concept of issuer grant reports.\u00a0 Using these, an issuer could report grants of stock-based compensation on SEDAR.\u00a0 Insiders would then be exempt from the five day filing requirement and could file an alternative report annually instead.<\/p>\n

A requirement for certain issuers to disclose late filings of insider reports.\u00a0 Another change is the proposed requirement for issuers to disclose their annual information circulars where any of their directors or executive officers have been subject to late filing fees relating to the late filing of insider reports.<\/p>\n

A requirement for disclosure of unexercised conversion of securities that are convertible within sixty days for certain insiders.\u00a0 Another new concept is that of significant shareholders based on post-conversion beneficial ownership.\u00a0 This concept is based on similar requirements in the early warning regimes for takeover bids and is intended to ensure that a person who owns convertible securities that have the right or obligation to acquire beneficial ownership of the underlying security within sixty days cannot avoid the disclosure requirements by holding a convertible security rather than the underlying security.\u00a0 In effect, the proposed NI 55-104 deems such a party to own the underlying security for the purpose of insider reporting obligations.<\/p>\n

The proposed NI 55-104 is not yet in effect; however, approval seems likely.\u00a0 Insiders should be aware of the progress of this initiative and be prepared for the changes it will bring.\u00a0 Your lawyer can help you with that.<\/p>\n

This article was originally published in the\u00a0April 28, 2009 edition of the Ottawa Business Journal<\/em>.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

The Canadian Securities Administrators have recently published a new proposed National Instrument 55-104 – Insider Reporting Requirements and Exemptions (\u201cNI 55-104\u201d) to replace a number of instruments that currently govern insider reporting.\u00a0 The proposed NI 55-104 will contain the main insider reporting requirements and exemptions for insiders or reporting issuers, except in Ontario, where the […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"wds_primary_category":0,"wds_primary_expertise_area":0,"footnotes":""},"categories":[161],"tags":[],"class_list":["post-1643","post","type-post","status-publish","format-standard","hentry","category-publications"],"acf":[],"_links":{"self":[{"href":"https:\/\/perlaw.ca\/fr\/wp-json\/wp\/v2\/posts\/1643","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/perlaw.ca\/fr\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/perlaw.ca\/fr\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/perlaw.ca\/fr\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/perlaw.ca\/fr\/wp-json\/wp\/v2\/comments?post=1643"}],"version-history":[{"count":1,"href":"https:\/\/perlaw.ca\/fr\/wp-json\/wp\/v2\/posts\/1643\/revisions"}],"predecessor-version":[{"id":3178,"href":"https:\/\/perlaw.ca\/fr\/wp-json\/wp\/v2\/posts\/1643\/revisions\/3178"}],"wp:attachment":[{"href":"https:\/\/perlaw.ca\/fr\/wp-json\/wp\/v2\/media?parent=1643"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/perlaw.ca\/fr\/wp-json\/wp\/v2\/categories?post=1643"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/perlaw.ca\/fr\/wp-json\/wp\/v2\/tags?post=1643"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}