472 A loan or investment referred to in section 471 is deemed not to be prohibited by the provisions of this Part.
PART XAdequacy of Capital and Liquidity
Marginal note:Adequacy of capital and liquidity
and shall comply with any regulations in relation thereto.
Marginal note:Regulations and guidelines
(2) The Governor in Council may make regulations and the Superintendent may make guidelines respecting the maintenance by companies of adequate capital and adequate and appropriate forms of liquidity.
(3) Notwithstanding that a company is complying with regulations or guidelines made under subsection (2), the Superintendent may, by order, direct the company
(4) A company shall comply with an order made under subsection (3) within such time as the Superintendent specifies therein.
Marginal note:Notice of value
(5) Where an appraisal of any asset held by a company or any of its subsidiaries has been made by the Superintendent and the value determined by the Superintendent to be the appropriate value of the asset varies materially from the value placed by the company or subsidiary on the asset, the Superintendent shall send to the company, the auditor of the company and the audit committee of the company a written notice of the appropriate value of the asset as determined by the Superintendent.
- 1991, c. 45, s. 473;
- 1996, c. 6, s. 120.
Interpretation and Application
Definition of senior officer
473.1 For the purposes of this Part, a senior officer of a body corporate is a person who is
(a) a director of the body corporate who is a full-time employee of the body corporate;
(b) the chief executive officer, chief operating officer, president, secretary, treasurer, controller, chief financial officer, chief accountant, chief auditor or chief actuary of the body corporate;
(c) a natural person who performs functions for the body corporate similar to those performed by a person referred to in paragraph (b);
(d) the head of the strategic planning unit of the body corporate;
(e) the head of the unit of the body corporate that provides legal services or human resources services to the body corporate; or
(f) any other officer reporting directly to the body corporate’s board of directors, chief executive officer or chief operating officer.
- 1997, c. 15, s. 397.
Marginal note:Related party of company
(a) is a person who has a significant interest in a class of shares of the company;
(b) is a director or senior officer of the company or of a body corporate that controls the company or is acting in a similar capacity in respect of an unincorporated entity that controls the company;
(c) is the spouse or common-law partner, or a child who is less than eighteen years of age, of a person described in paragraph (a) or (b);
(d) is an entity that is controlled by a person referred to in any of paragraphs (a) to (c);
(e) is an entity in which a person who controls the company has a substantial investment;
(f) is an entity in which the spouse or common-law partner, or a child who is less than eighteen years of age, of a person who controls the company has a substantial investment; or
(g) is a person, or a member of a class of persons, designated under subsection (3) or (4) as, or deemed under subsection (5) to be, a related party of the company.
(h) [Repealed, 1997, c. 15, s. 398]
Marginal note:Exception — subsidiaries and substantial investments of companies
(2) If an entity in which a company has a substantial investment would, but for this subsection, be a related party of the company only because a person who controls the company controls the entity or has a substantial investment in the entity, and the person does not control the entity or have a substantial investment in the entity otherwise than through the person’s controlling interest in the company, the entity is not a related party of the company.
Marginal note:Designated related party
(3) For the purposes of this Part, the Superintendent may, with respect to a particular company, designate as a related party of the company
(a) any person or class of persons whose direct or indirect interest in or relationship with the company or a related party of the company might reasonably be expected to affect the exercise of the best judgment of the company in respect of a transaction; or
(b) any person who is a party to any agreement, commitment or understanding referred to in section 9 if the company referred to in that section is the particular company.
(4) Where a person is designated as a related party of a company pursuant to subsection (3), the Superintendent may also designate any entity in which the person has a substantial investment and any entity controlled by such an entity to be a related party of the company.
Marginal note:Deemed related party
(5) Where, in contemplation of a person becoming a related party of a company, the company enters into a transaction with the person, the person is deemed for the purposes of this Part to be a related party of the company in respect of that transaction.
Marginal note:Holders of exempted shares
(6) The Superintendent may, by order, designate a class of non-voting shares of a company for the purpose of this subsection. If a class of non-voting shares of a company is so designated, a person is deemed, notwithstanding paragraph (1)(a), not to be a related party of the company if the person would otherwise be a related party of the company only because the person has a significant interest in that class.
Marginal note:Determination of substantial investment
(7) For the purpose of determining whether an entity or a person has a substantial investment for the purposes of paragraph (1)(e) or (f), the references to “control” and “controlled” in section 10 shall be construed as references to “control, within the meaning of section 3, determined without regard to paragraph 3(1)(d)” and “controlled, within the meaning of section 3, determined without regard to paragraph 3(1)(d)”, respectively.
Marginal note:Determination of control
(8) For the purposes of paragraph (1)(d), “controlled” means “controlled, within the meaning of section 3, determined without regard to paragraph 3(1)(d)”.
- 1991, c. 45, s. 474;
- 1997, c. 15, s. 398;
- 2000, c. 12, s. 302.
Marginal note:Non-application of Part
475 (1) This Part does not apply in respect of any transaction entered into prior to the coming into force of this Part but, after the coming into force of this Part, any modification of, addition to, or renewal or extension of a prior transaction is subject to this Part.
(2) This Part does not apply in respect of
(a) money or other assets held in trust, other than guaranteed trust money and assets held in respect thereof;
(b) the issue of shares of any class of shares of a company when fully paid for in money or when issued
(i) in accordance with any provisions for the conversion of other issued and outstanding securities of the company into shares of that class of shares,
(ii) as a share dividend,
(iii) in exchange for shares of a body corporate that has been continued as a company under Part III,
(iv) in accordance with the terms of an amalgamation under Part VI,
(v) by way of consideration in accordance with the terms of a sale agreement under Part VI, or
(vi) with the approval in writing of the Superintendent, in exchange for shares of another body corporate;
(c) the payment of dividends by a company;
(d) transactions that consist of the payment or provision by a company to persons who are related parties of the company of salaries, fees, stock options, pension benefits, incentive benefits or other benefits or remuneration in their capacity as directors, officers or employees of the company;
(f) if a company is controlled by a widely held bank holding company or a widely held insurance holding company, transactions approved by the Superintendent that are entered as part of, or in the course of, a restructuring of the holding company or of any entity controlled by it.
(3) Nothing in paragraph (2)(d) exempts from the application of this Part the payment by a company of fees or other remuneration to a person for
Marginal note:Exception for holding body corporate
(4) A holding body corporate of a company is not a related party of a company if the holding body corporate is a Canadian financial institution that is referred to in any of paragraphs (a) to (d) of the definition “financial institution” in section 2.
Marginal note:Substantial investment — related party exception
(5) Where a holding body corporate of a company is, because of subsection (4), not a related party of the company, any entity in which the holding body corporate has a substantial investment is not a related party of the company if no related party of the company has a substantial investment in the entity otherwise than through the control of the holding body corporate.
- 1991, c. 45, s. 475, c. 48, s. 493;
- 1997, c. 15, s. 399;
- 2001, c. 9, s. 551.
- Date modified: