1.1 (1) For the purposes of subsections 4(3) and 7(2) of the Act, borrowers are related when one borrower
(a) controls, directly or indirectly in any manner, the other borrower;
(b) is controlled, directly or indirectly in any manner, by the same person or group of persons as the other borrower;
(c) carries on their small business in partnership with the other borrower, which carries on another small business; or
(d) shares management services, administrative services, equipment, facilities or overhead expenses of the business with the other borrower, but is not in partnership with that borrower.
(2) For the purpose of subsection (1), “borrower” includes a person to whom a guaranteed business improvement loan was made under the Small Business Loans Act, if that loan is outstanding.
(3) For the purpose of subsection (1), “control” means to hold shares of a corporation to which are attached more than 50% of the votes that are necessary to elect a majority of its directors.
(4) Despite subsection (1), borrowers whose businesses are located at different premises are not related if neither borrower derives more than 25% of their actual or projected gross revenues from the other.
- SOR/2009-102, s. 2.
2. (1) A loan must be registered, subject to subsection (2), within three months after the day on which the loan is made.
(2) If subsection (1) is not complied with and the non-compliance is inadvertent, the Minister must extend the period within which that subsection must be complied with by a period of three months.
- SOR/2009-102, s. 24(F).
3. (1) A loan registration form must be signed by the borrower and the lender and contain the following information:
(a) the borrower’s name and the civic address and telephone number of the small business;
(a.1) the names of the borrower’s shareholders and the names of the guarantors or suretyships referred to in sections 19 and 20;
(b) the day on which the loan was made;
(c) a statement setting out separately
(i) the total amount of the loan,
(ii) the estimated amount of the loan allocated to each class of loans referred to in paragraphs 5(1)(a) to (c), and
(iii) the amount of the loan allocated to the class of loan referred to in paragraph 5(1)(d);
(d) the total estimated cost of the purchase or improvement to be financed by the loan;
(e) [Repealed, SOR/2009-102, s. 3]
(f) the lender’s acknowledgement that the lender has not charged the borrower any fees or charges other than those authorized by the Act and these Regulations;
(g) the borrower’s consent to
(i) the Minister’s audit of the loan approval and administration file held by the lender in respect of the loan, and
(ii) the release, by the Minister, of information with respect to the borrower’s outstanding loans, to another lender to whom the borrower applies for a loan;
(h) the lender’s acknowledgement that, before making the loan, it verified within the branch where the loan was to be made, or if it has no branches, within itself, that the outstanding loan amount in relation to the borrower does not exceed the amount provided for in paragraph 4(2)(b) of the Act;
(i) the borrower’s acknowledgement that the outstanding loan amount in relation to the borrower does not exceed the amount provided for in paragraph 4(2)(b) of the Act;
(j) the borrower’s acknowledgement that the making of the loan is not prohibited by any of subsections 5(2) to (4) or (6);
(k) the lender’s acknowledgement that, before approving the loan, the lender acted in accordance with the due diligence requirements referred to in section 8; and
(l) the borrower’s acknowledgement, for the purposes of subsection 14(6), as to whether or not the borrower is at arm’s length from the landlord.
(2) to (6) [Repealed, SOR/2009-102, s. 3]
- SOR/2009-102, s. 3.
- Date modified: