An Act to amend the law governing financial institutions and to provide for related and consequential matters (S.C. 2007, c. 6)
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Assented to 2007-03-29
PART 21991, c. 48AMENDMENTS TO THE COOPERATIVE CREDIT ASSOCIATIONS ACT
165. The Act is amended by adding the following after section 385.13:
Registered Products
Marginal note:Disclosure required concerning registered products
385.131 (1) Subject to subsection (2), a retail association shall not open an account that is or forms part of a registered product in the name of a customer, or enter into an agreement with a customer for a prescribed product or service that is or forms part of a registered product, unless the retail association provides, in the prescribed manner, to the individual requesting the account or the prescribed product or service
(a) information about all charges applicable to the registered product;
(b) information about how the customer will be notified of any increase in those charges and of any new charges applicable to the registered product;
(c) information about the retail association’s procedures relating to complaints about the application of any charge applicable to the registered product; and
(d) any other information that may be prescribed.
Marginal note:Regulations
(2) The Governor in Council may make regulations specifying the circumstances under which a retail association need not provide the information.
Definition of “registered product”
(3) In this section, “registered product” means a product that is defined to be a registered product by the regulations.
166. Section 385.22 of the Act is amended by adding the following after subsection (2):
Marginal note:How procedures to be made available
(3) A retail association shall make its procedures established under paragraph (1)(a) available
(a) in the form of a brochure, at its branches where products or services are offered in Canada;
(b) on its websites through which products or services are offered in Canada; and
(c) in written format to be sent to any person who requests them.
Marginal note:Information on contacting Agency
(4) A retail association shall also make prescribed information on how to contact the Agency available whenever it makes its procedures established under paragraph (1)(a) available under subsection (3).
167. The Act is amended by adding the following before section 385.25:
Marginal note:Charges for prescribed products or services
385.241 A retail association shall not, directly or indirectly, charge or receive any sum for the provision of any prescribed products or services unless the charge is made by express agreement between it and a customer or by order of a court.
168. The Act is amended by adding the following after section 385.25:
Marginal note:Regulations respecting the holding of funds
385.251 The Governor in Council may make regulations respecting the maximum period during which a retail association may hold funds in respect of specified classes of cheques or other instruments that are deposited into an account at a branch or prescribed point of service in Canada before permitting the customer in whose name the account is kept to access the funds.
Marginal note:2001, c. 9, s. 313
169. (1) Subsection 385.27(1) of the French version of the Act is replaced by the following:
Marginal note:Avis de fermeture de bureau
385.27 (1) Sous réserve des règlements pris en vertu du paragraphe (5), l’association membre qui a au Canada un bureau dans lequel elle ouvre des comptes de dépôt de détail et procède à la sortie de fonds pour ses clients par l’intermédiaire d’une personne physique donne un préavis — conforme à ces règlements — de la fermeture du bureau ou de la cessation de l’une ou l’autre de ces activités.
Marginal note:2001, c. 9, s. 313
(2) Subsection 385.27(2) of the Act is replaced by the following:
Marginal note:Pre-closure meeting
(2) After notice is given but before the branch is closed or ceases to carry on the activities, the Commissioner shall, in prescribed situations, require the member association to convene and hold a meeting between representatives of the member association, representatives of the Agency and interested parties in the vicinity of the branch in order to exchange views about the closing or cessation of activities, including, but not limited to, alternative service delivery by the member association and measures to help the branch’s customers adjust to the closing or cessation of activities.
Marginal note:2001, c. 9, s. 313
170. Subparagraph 385.28(a)(iv) of the Act is replaced by the following:
(iv) any other matter that may affect their dealings, or their employees’ or representatives’ dealings, with customers or the public;
171. Subsection 386(1) of the Act is amended by adding the following in alphabetical order:
“closed-end fund”
« fonds d’investissement à capital fixe »
“closed-end fund” means an entity whose activities are limited to investing the funds of the entity so as to provide investment diversification and professional investment management to the holders of its securities, and whose securities are
(a) fixed in number and distributed to the public in an offering under a preliminary prospectus, prospectus, short-form prospectus or similar document in accordance with the laws of a province or a foreign jurisdiction;
(b) traded on an exchange or an over-the-counter market; and
(c) liquidated on a fixed future termination date, the proceeds of which are allocated to the holders of the securities on a proportional basis.
172. Section 388 of the Act is amended by adding the following after subsection (5):
Marginal note:Application of other provision
(6) Despite having acquired control of, or a substantial investment in, an entity under a particular provision of this Part, an association may continue to control the entity or hold the substantial investment in the entity as though it had made the acquisition under another provision of this Part so long as the conditions of that other provision are met.
Marginal note:Timing of deemed acquisition
(7) If an association decides to exercise its right under subsection (6), the association is deemed to be acquiring the control or the substantial investment under the other provision.
Marginal note:2001, c. 9, s. 314
173. (1) Paragraph 390(1)(h) of the French version of the Act is replaced by the following:
h) une entité qui est constituée en personne morale ou formée et réglementée autrement que sous le régime d’une loi fédérale ou provinciale et qui exerce principalement, à l’étranger, des activités commerciales qui, au Canada, seraient des opérations bancaires, l’activité d’une société coopérative de crédit, des opérations d’assurance, la prestation de services fiduciaires ou le commerce de valeurs mobilières.
Marginal note:2001, c. 9, s. 314
(2) Paragraph 390(2)(e) of the Act is replaced by the following:
(e) engaging in the activities referred to in the definition “closed-end fund”, “mutual fund distribution entity”, “mutual fund entity” or “real property brokerage entity” in subsection 386(1); and
(3) Section 390 of the Act is amended by adding the following after subsection (3):
Marginal note:Exception
(3.1) Despite paragraph (3)(a), an association may acquire control of, or acquire or increase a substantial investment in, any entity that acts as a trustee of a trust if the entity has been authorized under the laws of a province to act as a trustee of a trust and the entity is
(a) a closed-end fund;
(b) a mutual fund entity; or
(c) an entity whose business is limited to engaging in one or more of the following:
(i) the activities of a mutual fund distribution entity,
(ii) any activity that an association is permitted to engage in under subsection 376(2), and
(iii) the provision of investment counselling services and portfolio management services.
Marginal note:2001, c. 9, s. 314
(4) Paragraphs 390(4)(b) and (c) of the French version of the Act are replaced by the following:
b) s’agissant d’une entité dont les activités commerciales comportent une activité visée à l’alinéa (2)a) et qui exerce, dans le cadre de ses activités commerciales, des activités d’intermédiaire financier comportant des risques importants de crédit ou de marché, notamment une entité s’occupant d’affacturage, une entité s’occupant de crédit-bail ou une entité s’occupant de financement, elle ne peut le faire que si :
(i) soit elle la contrôle ou en acquiert de la sorte le contrôle, au sens de l’alinéa 3(1)e),
(ii) soit elle est autorisée par règlement pris en vertu de l’alinéa 396a) à acquérir ou à augmenter l’intérêt;
c) s’agissant d’une entité dont les activités commerciales comportent une activité visée à l’alinéa (2)b), y compris une entité s’occupant de financement spécial, elle ne peut le faire que si :
(i) soit elle la contrôle ou en acquiert de la sorte le contrôle, au sens de l’alinéa 3(1)e),
(ii) soit elle est autorisée par règlement pris en vertu de l’alinéa 396a) à acquérir ou à augmenter l’intérêt,
(iii) soit, sous réserve des modalités éventuellement fixées par règlement, les activités de l’entité ne comportent pas l’acquisition ou la détention du contrôle d’une entité visée aux alinéas a) ou b) ou d’une entité qui n’est pas une entité admissible, ni d’actions ou de titres de participation dans celle-ci.
Marginal note:2001, c. 9, s. 314
(5) Paragraph 390(5)(d) of the Act is replaced by the following:
(d) acquire control of, or acquire or increase a substantial investment in, an entity that engages in Canada in an activity described in paragraph 376(1)(g);
(d.1) acquire control of, or acquire or increase a substantial investment in, an entity that engages in an activity described in paragraph 376(1)(h); or
Marginal note:2001, c. 9, s. 314
(6) Paragraph 390(7)(a) of the Act is replaced by the following:
(a) the association is acquiring control of an entity, other than a specialized financing entity, and the only reason for which the association would, but for this subsection, require approval for the acquisition is that the entity carries on activities referred to in paragraph (2)(b);
Marginal note:2001, c. 9, s. 314
174. Subsections 393(4) and (5) of the Act are replaced by the following:
Marginal note:Temporary investment
(4) If an association, by way of temporary investment, acquires control of, or acquires or increases a substantial investment in, an entity for which the approval of the Minister would have been required under subsection 390(5) if the association had acquired the control, or acquired or increased the substantial investment, under section 390, the association must, within 90 days after acquiring control or after acquiring or increasing the substantial investment,
(a) apply to the Minister for approval to retain control of the entity or to continue to hold the substantial investment in the entity for a period specified by the Minister or for an indeterminate period on any terms and conditions that the Minister considers appropriate; or
(b) do all things necessary to ensure that, on the expiry of the 90 days, it no longer controls the entity or does not have a substantial investment in the entity.
Marginal note:Indeterminate extension
(5) If an association, by way of temporary investment, acquires control of, or acquires or increases a substantial investment in, an entity for which the approval of the Superintendent would have been required under subsection 390(6) if the association had acquired the control, or acquired or increased the substantial investment, under section 390, the Superintendent may, on application, permit the association to retain control of the entity or to continue to hold the substantial investment in the entity for an indeterminate period, on any terms and conditions that the Superintendent considers appropriate.
175. Subsection 394(1) of the Act is amended by striking out the word “or” at the end of paragraph (c), by adding the word “or” at the end of paragraph (d) and by adding the following after paragraph (d):
(e) all or any of the ownership interests in any entity that is primarily engaged in holding shares of, ownership interests in or assets acquired from the entity or any of its affiliates.
176. (1) Section 406 of the Act is amended by adding the following after subsection (1):
Marginal note:Approval of series of transactions
(1.1) The Superintendent may, for the purposes of subsection (1), approve a transaction or series of transactions relating to the acquisition or transfer of assets that may be entered into with a person, or with persons of any class of persons, regardless of whether those persons are known at the time of the granting of the approval or not.
Marginal note:2001, c. 9, s. 314
(2) Subsections 406(2) to (4) of the Act are replaced by the following:
Marginal note:Exception
(2) Subsection (1) does not apply in respect of a transaction or series of transactions between an association and a member of the association.
Marginal note:Exception
(3) Subsection (1) does not apply in respect of
(a) an asset that is a debt obligation referred to in subparagraphs (b)(i) to (vi) of the definition “commercial loan” in subsection 386(1);
(b) assets acquired or transferred under a transaction or series of transactions by an association with another financial institution as a result of the association’s participation in one or more syndicated loans with that financial institution;
(c) assets purchased or sold under a sale agreement that is approved by the Minister under section 233.5;
(d) shares of, or ownership interests in, an entity for which the approval of the Minister under Part VIII or subsection 390(5) is required or the approval of the Superintendent under subsection 390(6) is required;
(e) assets, other than real property, acquired or disposed of under an arrangement that has been approved by the Superintendent under subsection 418(3); or
(f) assets acquired or disposed of with the approval of the Superintendent under subsection 418(3.1).
Marginal note:2001, c. 9, s. 314
(3) Paragraph 406(5)(b) of the Act is replaced by the following:
(b) in the case of assets that are transferred, the value of the assets as reported in the last annual statement of the association prepared before the transfer or, if the value of the assets is not reported in that annual statement, the value of the assets as it would be reported in the annual statement of the association if the annual statement had been prepared, in accordance with the accounting principles referred to in subsection 292(4), immediately before the transfer.
Marginal note:2001, c. 9, s. 314
(4) Subsection 406(7) of the Act is replaced by the following:
Marginal note:Total value of all assets
(7) For the purposes of subsection (1), the total value of all assets that the association or any of its subsidiaries has transferred during the 12-month period referred to in subsection (1) is the total of the value of each of those assets as reported in the last annual statement of the association prepared before the transfer of the asset or, if the value of any of those assets is not reported in that annual statement, as it would be reported in the annual statement of the association if the annual statement had been prepared, in accordance with the accounting principles referred to in subsection 292(4), immediately before the transfer of the asset.
177. Section 412 of the Act is amended by adding the following after subsection (3):
Marginal note:Security of a related party
(4) For the purposes of this Part, “security” of a related party includes an option, transferable by delivery, to demand delivery of a specified number or amount of shares of the related party at a fixed price within a specified time.
178. Section 418 of the Act is amended by adding the following after subsection (4):
Marginal note:Approval under section 233.5
(5) An association may acquire any assets from, or dispose of any assets to, a related party of the association under a sale agreement that is approved by the Minister under section 233.5.
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