Insurance Companies Act (S.C. 1991, c. 47)

Marginal note:Inadmissible assets

• 612. (1) A foreign company may not vest in trust

  • (a) securities issued by or debt obligations of the foreign company or one of its affiliates;

  • (b) real property, or ground rents or mortgages on real property, situated outside Canada;

  • (c) shares or ownership interests, however designated, in any entity in such number as would constitute a substantial investment in that entity without regard to any shares or ownership interests held by any other entity; or

  • (d) a loan made in Canada on the security of residential property in Canada for the purpose of purchasing, renovating or improving that property, if the amount of the loan, together with the amount then outstanding of any mortgage having an equal or prior claim against the property, would exceed 80 per cent of the value of the property at the time of the loan.

• Marginal note:Exception

  (2) Despite paragraphs (1)(a) and (c), a foreign company may vest in trust a substantial investment in an entity that is primarily engaged in

  • (a) holding, managing or otherwise dealing with real property; or

  • (b) holding shares or ownership interests in entities that are primarily engaged in any of the activities referred to in paragraph (a).

• Marginal note:Idem

  (3) Notwithstanding paragraph (1)(d), a foreign company may vest in trust

  • (a) a loan made or guaranteed under the National Housing Act or any other Act of Parliament by or pursuant to which a different limit on the value of property on the security of which the foreign company may make a loan is established;

  • (b) a loan if repayment of the amount of the loan that exceeds the maximum amount set out in subsection (1) is guaranteed or insured by a government agency or a private insurer approved by the Superintendent; or

  • (c) securities issued or guaranteed by an entity that are secured on any residential property, whether in favour of a trustee or otherwise, or a loan made by the foreign company to the entity against the issue of such securities.

Definition of “commercial loan”

613. In sections 615 to 620, “commercial loan” has the same meaning as in Part IX.

Marginal note:Non-application

• 614. (1) Sections 612 and 615 to 620 do not apply in respect of assets of a foreign company held in relation to a segregated fund maintained pursuant to section 593.

• Marginal note:Exclusion of liabilities of segregated funds

  (2) A reference in sections 615 to 619 and in regulations made under section 620 to the assets in Canada or the liabilities in Canada of a foreign company does not include liabilities of the foreign company for the policies and amounts in respect of which a segregated fund is maintained pursuant to section 593.