Canada Deposit Insurance Corporation Act (R.S.C., 1985, c. C-3)

Marginal note:Stay of proceedings — bridge institution

• 39.151 (1) Any action or other civil proceeding before a judicial or quasi-judicial body and any arbitration, to which a bridge institution may become a party by virtue of acquiring an asset or assuming a liability of the federal member institution shall be stayed for a period of 90 days from the day on which the bridge institution acquires the asset or assumes the liability.

• Marginal note:Waiver

  (2) The bridge institution may waive the stay referred to in subsection (1).

Marginal note:Assignments — bridge institution or third party

• 39.152 (1) Subject to subsection (2), if an agreement with a federal member institution is assigned to or assumed by a bridge institution or a third party,

  • (a) a person is prohibited from terminating or amending the agreement, or claiming an accelerated payment or forfeiture of the term under the agreement, by reason only of

    • (i) the insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors,

    • (ii) the making of an order under subsection 39.13(1) or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order,

    • (iii) a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under the agreement,

    • (iv) a monetary default, before the order was made, under the agreement by the federal member institution or any of its affiliates that is remedied within 60 days after the day on which the agreement is assigned or assumed,

    • (v) the assignment or assumption of the agreement to or by a bridge institution or a third party,

    • (vi) the transfer to a third party of all or part of the assets or liabilities of the federal member institution or any of its affiliates,

    • (vii) a conversion under subsection 39.2(2.3) in respect of the federal member institution, or

    • (viii) a conversion of any of the federal member institution’s shares or liabilities in accordance with the contractual terms of those shares or liabilities; and

  • (b) any stipulation in the agreement that has the effect of providing for or permitting anything that, in substance, is contrary to any of subparagraphs (a)(i) to (viii) or provides, in substance, that the bridge institution or the third party does not have the rights to use or deal with assets that the bridge institution or the third party would otherwise have by reason of the occurrence of any circumstance described in those subparagraphs, is of no force or effect.

• Marginal note:Exception

  (2) Subparagraphs (1)(a)(iii) and (iv) do not apply to an eligible financial contract, as defined in subsection 39.15(9).

• Marginal note:Membership in organization

  (3) If a bridge institution or a third party becomes a member of an organization in place of a federal member institution, it is prohibited for the organization to terminate the membership of the bridge institution or of the third party by reason only of

  • (a) the insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors;

  • (b) the making of an order under subsection 39.13(1) or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order;

  • (c) a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under the rules of the organization;

  • (d) a monetary default, before the order was made, under the rules of the organization by the federal member institution or any of its affiliates that is remedied within 60 days after the day on which the order is made;

  • (e) the transfer of the federal member institution’s membership to a bridge institution or a third party;

  • (f) the transfer to a third party of all or part of the assets or liabilities of the federal member institution or any of its affiliates;

  • (g) a conversion under subsection 39.2(2.3) in respect of the federal member institution; or

  • (h) a conversion of any of the federal member institution’s shares or liabilities in accordance with the contractual terms of those shares or liabilities.

Marginal note:Exemption

39.16 The Governor in Council may, in an order made under subsection 39.13(1), provide that subsection 39.15(1) or (2) or any portion thereof does not apply in respect of the federal member institution.

Marginal note:Leave of court

• 39.17 (1) A superior court may, on any terms that it considers proper, grant leave to a person to do anything that the person would otherwise be prevented from doing by section 39.15 or lift, or reduce the length of, a stay under section 39.151 if the court is satisfied

  • (a) that the person is likely to be materially prejudiced if leave is not granted; or

  • (b) that it is equitable on other grounds to grant leave.

• Marginal note:Corporation to be made party

  (2) The Corporation must be joined as a respondent in any application under subsection (1) and is entitled to such notice of the application as the court considers proper.

• Marginal note:Orders of national effect

  (3) An order of a superior court of a province under subsection (1) may, if the order so provides, have effect in all or a part of Canada outside the province.

Marginal note:Termination

• 39.18 (1) Subject to subsection (2), sections 39.14 and 39.15 cease to apply in respect of a federal member institution

  • (a) on the date specified in a notice described in subsection 39.2(3) in respect of the federal member institution; or

  • (b) on the date that a winding-up order is made in respect of the federal member institution.

• Marginal note:Exceptions

  (2) If a notice referred to in paragraph (1)(a) has been published but an order described in paragraph (1)(b) has not been made,

  • (a) paragraph 39.15(1)(e) or (f) or subsection 39.15(2) or (2.1) continues to apply to the extent that it produced its effects by reason of

    • (i) the insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors,

    • (ii) the making of the order under subsection 39.13(1) or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order,

    • (iii) a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under an agreement or the rules of an organization,

    • (iv) a monetary default, before the order was made, under an agreement or the rules of an organization by the federal member institution or any of its affiliates that was remedied within 60 days after the day on which the order was made,

    • (v) a conversion under subsection 39.2(2.3) in respect of the federal member institution, or

    • (vi) a conversion of any of the federal member institution’s shares or liabilities in accordance with contractual terms of those shares or liabilities; and

  • (b) subsections 39.15(7.1) to (7.3) continue to apply.

• Marginal note:Stay terminated by order

  (3) The Governor in Council may, by order, declare that paragraph (2)(a) ceases to apply in respect of the federal member institution if the Governor in Council considers that all or substantially all of the institution’s assets have been transferred to a bridge institution or a third party.

Non-application of Certain Legislative Provisions

Marginal note:Not agent or Crown corporation

• 39.181 (1) A federal member institution that is a subsidiary of the Corporation as a result of an order made under paragraph 39.13(1)(a) or (b), a bridge institution or a subsidiary of either of those institutions is not an agent of the Corporation or Her Majesty in right of Canada and, despite Part X of the Financial Administration Act, is not a parent Crown corporation, or a wholly-owned subsidiary, within the meaning of section 83 of that Act. Their respective directors, officers and employees are not part of the federal public administration.

• Marginal note:Exception

  (2) Despite subsection (1), Division V of Part X of the Financial Administration Act and the regulations made under that Division apply to the federal member institution, the bridge institution or a subsidiary of either of those institutions as if it were a Crown corporation within the meaning of section 83 of that Act.

Marginal note:Part VII of Bank Act, etc., inapplicable

• 39.19 (1) The following enactments do not apply in respect of shares of a federal member institution that are vested in the Corporation by an order made under paragraph 39.13(1)(a):

  • (a) section 12.1, paragraph 28(1)(a.1), section 35.1, paragraphs 40(f) and (g), sections 40.1, 47.03, 47.04, 47.06, 47.11, 47.12, 47.15, 47.17 and 47.18, subsection 53(2), paragraph 54(1)(b), section 60.1, subsections 79.2(1) and (2) and sections 159.1, 372, 373, 374, 375, 376, 376.1, 376.2, 377, 377.1, 377.2, 379, 382.1, 385, 401.11, 401.2 and 401.3 of the Bank Act;

  • (b) sections 407, 407.01, 407.02, 407.03, 407.1, 407.2, 408, 411, 428 and 430 of the Insurance Companies Act; and

  • (c) sections 375, 375.1, 376, 379 and 396 and subsection 399(2) of the Trust and Loan Companies Act.

• Marginal note:Public holding requirement re parent

  (2) An exemption from the application of section 385 of the Bank Act, section 411 of the Insurance Companies Act or section 379 of the Trust and Loan Companies Act that is granted under section 388 of the Bank Act, section 414 of the Insurance Companies Act or section 382 of the Trust and Loan Companies Act continues in force notwithstanding that the entity that controls the bank, insurance company, trust company or loan company is a federal member institution the shares of which are vested in the Corporation by an order made under paragraph 39.13(1)(a).

• Marginal note:Termination

  (3) Subsections (1) and (2) cease to apply in respect of a federal member institution on the date specified in a notice described in subsection 39.2(3) in respect of the federal member institution.

Marginal note:Provisions do not apply

• 39.191 (1) Section 12.1, paragraph 28(1)(a.1), section 35.1, paragraphs 40(f) and (g), section 40.1, 47.11, 47.12, 47.15 and 47.18, subsection 53(2), paragraph 54(1)(b) and section 159.1 of the Bank Act do not apply if the Corporation is appointed as receiver of a federal member institution that is a federal credit union by an order made under paragraph 39.13(1)(b).

• Marginal note:Termination

  (2) Subsection (1) ceases to apply in respect of a federal member institution on the date specified in a notice described in subsection 39.2(3) in respect of the federal member institution.

Marginal note:Regulation to exempt or adapt

• 39.192 (1) The Governor in Council may, by regulation,

  • (a) exempt federal member institutions in respect of which an order is made under subsection 39.13(1), bridge institutions or affiliates of either of those institutions, or any class of those institutions or class of their affiliates, or any other person from the application of any provision of this Act or the regulations or of the following Acts or the regulations made under them:

    • (i) the Bank Act,

    • (ii) the Canadian Payments Act,

    • (iii) the Cooperative Credit Associations Act,

    • (iv) the Financial Consumer Agency of Canada Act,

    • (v) the Insurance Companies Act,

    • (vi) the Office of the Superintendent of Financial Institutions Act,

    • (vii) the Trust and Loan Companies Act, and

    • (viii) the Winding-up and Restructuring Act; or

  • (b) provide that any provision of this Act or the regulations or of the Acts referred to in paragraph (a) or the regulations made under them applies to federal member institutions in respect of which an order is made under subsection 39.13(1), bridge institutions or affiliates of either of those institutions, or any class of those institutions or class of their affiliates, or any other person but only in the manner and to the extent provided for in the regulation made under this subsection, and adapt that provision for the purpose of that application.

• Marginal note:Order directed at a given federal member institution

  (2) The Governor in Council or the Minister may, by order, do anything that may be done by regulation under subsection (1) in respect of a federal member institution in respect of which an order is made under subsection 39.13(1), a bridge institution, an affiliate of either of those institutions or any other person.

• Marginal note:Scope or conditions

  (3) An exemption made under paragraph (1)(a) or subsection (2) may be limited in scope or duration or subject to conditions.

• Marginal note:Coming into force

  (4) An order made by the Minister does not take effect before the later of the date specified in a notice described in subsection 39.2(3) in respect of the federal member institution and the day on which an order made by the Governor in Council under subsection (2) expires.

• Marginal note:Expiry

  (5) An order made by the Minister expires one year after the day on which the order comes into force or any shorter period specified in the order.

• Marginal note:Extension

  (6) The Minister may, by order, grant one or more extensions of the applicable period set out in subsection (5) — of up to one year each — but the last extension must expire not later than five years after the date specified in the notice described in subsection 39.2(3).

• Marginal note:Statutory Instruments Act

  (7) The Statutory Instruments Act does not apply to an order made under subsection (2).

• Marginal note:Publication

  (8) The Minister shall cause an order made under subsection (2) to be published in the Canada Gazette as soon as he or she considers it appropriate to do so.