Financial Consumer Agency of Canada Act (S.C. 2001, c. 9)
Full Document:
Assented to 2001-06-14
438. Paragraph 562(b) of the Act is replaced by the following:
(b) acquire control of a permitted entity that holds commercial loans or loans to natural persons
Marginal note:1993, c. 34, s. 84(F); 1997, c. 15, ss. 295 and 296
439. Sections 563 to 566 of the Act are replaced by the following:
Marginal note:Limit on total property interest
563. A society shall not, and shall not permit its prescribed subsidiaries to,
(a) purchase or otherwise acquire an interest in real property, or
(b) make an improvement to any real property in which the society or any of its prescribed subsidiaries has an interest
if the aggregate value of all interests of the society in real property exceeds, or the acquisition of the interest or the making of the improvement would cause that aggregate value to exceed, an amount determined in accordance with the regulations.
Marginal note:Regulations
564. For the purposes of this Part, the Governor in Council may make regulations
(a) defining the interests of a society in real property;
(b) determining the method of valuing those interests; and
(c) respecting the determination of an amount for the purpose of each of sections 563, 565 and 566.
Equities
Marginal note:Limits on equity acquisitions
565. A society shall not, and shall not permit its prescribed subsidiaries to,
(a) purchase or otherwise acquire any participating shares of any body corporate or any ownership interests in any unincorporated entity, other than those of a permitted entity in which the society has, or by virtue of the acquisition would have, a substantial investment, or
(b) acquire control of an entity that holds shares or ownership interests referred to in paragraph (a),
if the aggregate value of
(c) all participating shares, excluding participating shares of permitted entities in which the society has a substantial investment, and
(d) all ownership interests in unincorporated entities, other than ownership interests in permitted entities in which the society has a substantial investment,
beneficially owned by the society and its prescribed subsidiaries exceeds, or the purchase or acquisition would cause that aggregate value to exceed, an amount determined in accordance with the regulations.
Aggregate Limit
Marginal note:Aggregate limit
566. A society shall not, and shall not permit its prescribed subsidiaries to,
(a) purchase or otherwise acquire
(i) participating shares of a body corporate, other than those of a permitted entity in which the society has, or by virtue of the acquisition would have, a substantial investment,
(ii) ownership interests in an unincorporated entity, other than ownership interests in a permitted entity in which the society has, or by virtue of the acquisition would have, a substantial investment, or
(iii) interests in real property, or
(b) make an improvement to real property in which the society or any of its prescribed subsidiaries has an interest
if the aggregate value of
(c) all participating shares and ownership interests referred to in subparagraphs (a)(i) and (ii) that are beneficially owned by the society and its prescribed subsidiaries, and
(d) all interests of the society in real property referred to in subparagraph (a)(iii)
exceeds, or the acquisition or the making of the improvement would cause that aggregate value to exceed, an amount determined in accordance with the regulations.
Marginal note:1997, c. 15, s. 297
440. Sections 568 and 569 of the Act are replaced by the following:
Marginal note:Deemed temporary investment
568. If a society controls or has a substantial investment in an entity as permitted by this Part and the society becomes aware of a change in the business or affairs of the entity that, if the change had taken place before the acquisition of control or of the substantial investment, would have caused the entity not to be a permitted entity or would have been such that approval for the acquisition would have been required under subsection 554(5), the society is deemed to have acquired, on the day the society becomes aware of the change, a temporary investment in respect of which section 557 applies.
Marginal note:Asset transactions
569. (1) A society shall not, and shall not permit its subsidiaries to, without the approval of the Superintendent, acquire assets from a person or transfer assets to a person if
A + B > C
where
- A
- is the value of the assets;
- B
- is the total value of all assets that the society and its subsidiaries acquired from or transferred to that person in the twelve months ending immediately before the acquisition or transfer; and
- C
- is ten per cent of the total value of the assets of the society, as shown in the last annual statement of the society prepared before the acquisition or transfer.
Marginal note:Exception
(2) The prohibition in subsection (1) does not apply in respect of
(a) an asset that is a debt obligation referred to in subparagraphs (b)(i) to (v) of the definition “commercial loan” in subsection 490(1); or
(b) a transaction or series of transactions by a society with another financial institution as a result of the society’s participation in one or more syndicated loans with that financial institution.
Marginal note:Exception
(3) The approval of the Superintendent is not required if
(a) the society sells assets under a sale agreement that is approved by the Minister under subsection 254(2); or
(b) the society or its subsidiary acquires shares of, or ownership interests in, an entity for which the approval of the Minister under Part VII or subsection 554(5) is required.
Marginal note:Value of assets
(4) For the purposes of “A” in subsection (1), the value of the assets is
(a) in the case of assets that are acquired, the purchase price of the assets or, if the assets are shares of, or ownership interests in, an entity the assets of which will be included in the annual statement of the society after the acquisition, the fair market value of the assets; and
(b) in the case of assets that are transferred, the book value of the assets as stated in the last annual statement of the society prepared before the transfer or, if the assets are shares of, or ownership interests in, an entity the assets of which were included in the last annual statement of the society before the transfer, the value of the assets as stated in the annual statement.
Marginal note:Total value of all assets
(5) For the purposes of subsection (1), the total value of all assets that the society or any of its subsidiaries has acquired during the period of twelve months referred to in subsection (1) is the purchase price of the assets or, if the assets are shares of, or ownership interests in, an entity the assets of which immediately after the acquisition were included in the annual statement of the society, the fair market value of the assets of the entity at the date of the acquisition.
Marginal note:Total value of all assets
(6) For the purposes of subsection (1), the total value of all assets that the society or any of its subsidiaries has transferred during the period of twelve months referred to in subsection (1) is the book value of the assets as stated in the last annual statement of the society prepared before the transfer or, if the assets are shares of, or ownership interests in, an entity the assets of which were included in the last annual statement of the society before the transfer, the value of the assets of the entity as stated in the annual statement.
441. The Act is amended by adding the following after section 570:
Marginal note:Saving
570.001 A loan or investment referred to in section 570 is deemed not to be prohibited by the provisions of this Part.
Marginal note:1997, c. 15, s. 303
442. (1) The portion of subsection 587.1(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Restricted transactions
587.1 (1) Except in accordance with this section or an order made under subsection 678.6(1), a foreign company shall not
(2) Subsection 587.1(2) of the Act is amended by adding the following after paragraph (a):
(a.1) transfer all or any portion of its policies in Canada to any body corporate incorporated under the laws of a province that is authorized to transact the classes of insurance being transferred;
(a.2) cause itself to be reinsured, on an assumption basis, against all or any portion of the risks undertaken by it in respect of its policies in Canada by any body corporate incorporated under the laws of a province that is authorized to transact the classes of insurance to be reinsured if the Superintendent has entered into satisfactory arrangements concerning the reinsurance with
(i) the appropriate official or public body responsible for the supervision of the body corporate,
(ii) the body corporate, or
(iii) the appropriate official or public body and the body corporate;
443. Section 598 of the Act, as enacted by section 307 of An Act to amend certain laws relating to financial institutions, being chapter 15 of the Statutes of Canada, 1997, is replaced by the following:
Definition of “cost of borrowing”
598. For the purposes of this section and sections 598.1 to 605, “cost of borrowing” means, in respect of a loan or an advance on the security or against the cash surrender value of a policy made by a foreign company,
(a) the interest or discount applicable to the loan or advance;
(b) any amount charged in connection with the loan or advance that is payable by the borrower to the foreign company; and
(c) any charge prescribed to be included in the cost of borrowing.
For those purposes, however, “cost of borrowing” does not include any charge prescribed to be excluded from the cost of borrowing.
- Date modified: