Bank Act (S.C. 1991, c. 46)

Act current to 2014-10-15 and last amended on 2014-06-19. Previous Versions

Marginal note:Permitted branches re leasing

 Despite section 522.05, a foreign bank, or an entity that is incorporated or formed otherwise than by or under an Act of Parliament or of the legislature of a province and that is associated with a foreign bank, that does not have a financial establishment in Canada and that outside Canada

  • (a) engages only in the activities referred to in the definition “leasing entity” in subsection 507(1), or

  • (b) engages only in activities other than those referred to in any of

    • (i) paragraphs (a) to (g) of the definition “financial services entity” in subsection 507(1), and

    • (ii) paragraph (h) of that definition, except under prescribed circumstances,

may in Canada engage in the activities of a leasing entity so long as it does not engage in any other activity in Canada.

  • 2001, c. 9, s. 132.

Division 4Financial Establishment in Canada

Investments

Marginal note:Investment in a financial institution

 Subject to the requirements relating to approval set out in Division 5, a foreign bank or an entity associated with a foreign bank may acquire or hold control of, or a substantial investment in, a Canadian entity referred to in any of paragraphs 468(1)(a) to (i).

  • 2001, c. 9, s. 132;
  • 2007, c. 6, s. 58.
Marginal note:Permitted investments
  •  (1) Subject to subsection (2) and the requirements relating to approval set out in Division 5, a foreign bank or an entity associated with a foreign bank may acquire or hold control of, or a substantial investment in, a Canadian entity, other than an entity referred to in any of paragraphs 468(1)(a) to (i), whose business is limited to one or more of the following:

    • (a) engaging in

      • (i) any financial service activity that a bank is permitted to engage in under any of paragraphs 409(2)(a) to (d), or

      • (ii) any other activity that a bank is permitted to engage in under section 410 or 411;

    • (b) acquiring or holding shares of, or ownership interests in, entities that a foreign bank or an entity associated with a foreign bank is permitted to acquire or hold under this Division or Division 8 — other than limited commercial entities, except in prescribed circumstances;

    • (b.1) acquiring or holding shares of, or ownership interests in, entities incorporated or formed otherwise than by or under an Act of Parliament or of the legislature of a province;

    • (c) engaging in the provision of any services exclusively to any or all of the following, so long as the Canadian entity is also providing those services to the foreign bank or to any member of the foreign bank’s group, namely,

      • (i) the foreign bank,

      • (ii) any member of the foreign bank’s group,

      • (iii) any entity that is primarily engaged in the business of providing financial services,

      • (iv) any entity in which an entity referred to in subparagraph (iii) has a substantial investment and that is

        • (A) an entity in which a bank is permitted to acquire a substantial investment under section 468,

        • (B) an entity in which a foreign bank or an entity associated with a foreign bank is permitted to acquire a substantial investment under this section and section 522.07, or

        • (C) a prescribed entity, or

      • (v) any prescribed person, if it is doing so under prescribed terms and conditions, if any are prescribed;

    • (d) engaging in any activity that a bank is permitted to engage in — or in any other prescribed activity —, other than an activity referred to in paragraph (a) or (e), that relates to

      • (i) the promotion, sale, delivery or distribution of a financial product or financial service that is provided by the foreign bank or by any member of the foreign bank’s group, or

      • (ii) if a significant portion of the business of the Canadian entity involves an activity referred to in subparagraph (i), the promotion, sale, delivery or distribution of a financial product or financial service that is provided by any other entity that is primarily engaged in the business of providing financial services;

    • (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 464(1); and

    • (f) engaging in prescribed activities, under prescribed terms and conditions, if any are prescribed.

  • Marginal note:Additional restriction

    (2) A foreign bank or an entity associated with a foreign bank may not acquire or hold control of, or a substantial investment in, a Canadian entity whose business includes any activity referred to in any of paragraphs (1)(a) to (e) if the activities of the Canadian entity include

    • (a) activities that a bank is not permitted to engage in under section 412, 417 or 418;

    • (b) dealing in securities, except as may be permitted under paragraph (1)(e) or as may be permitted to a bank under paragraph 409(2)(c);

    • (c) activities that a bank is not permitted to engage in under section 416, if the Canadian entity engages in the activities of a finance entity or of any other entity as may be prescribed;

    • (d) acquiring or holding control of, or a substantial investment in, another Canadian entity unless

      • (i) in the case of a Canadian entity that is controlled by the foreign bank or the entity associated with a foreign bank, the foreign bank or the entity associated with a foreign bank itself would be permitted to acquire or hold control of, or a substantial investment in, the other Canadian entity under this section or section 522.07 or 522.1 or Division 8, or

      • (ii) in the case of a Canadian entity that is not controlled by the foreign bank or the entity associated with a foreign bank, the foreign bank or the entity associated with a foreign bank itself would be permitted to acquire or hold control of, or a substantial investment in, the other Canadian entity under this section, section 522.07, any of paragraphs 522.1(a) or (c) to (e) or Division 8; or

    • (e) any prescribed activity.

  • Marginal note:Exception

    (2.1) Despite paragraph (2)(a), a foreign bank or an entity associated with a foreign bank may acquire or hold control of, or acquire or increase a substantial investment in, any entity that acts as a trustee for a trust if the entity has been permitted under the laws of a province to act as a trustee for a trust and the following conditions are satisfied:

    • (a) the entity acts as a trustee only with respect to a closed-end fund or mutual fund entity; and

    • (b) if the entity engages in other business, that 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 a bank is permitted to engage in under paragraph 410(1)(c.2), and

      • (iii) the provision of investment counselling services and portfolio management services.

  • 2001, c. 9, s. 132;
  • 2007, c. 6, s. 59;
  • 2012, c. 5, s. 55.