Financial Consumer Agency of Canada Act (S.C. 2001, c. 9)
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Assented to 2001-06-14
AMENDMENTS TO ACTS IN RELATION TO FINANCIAL INSTITUTIONS
1991, c. 45Trust and Loan Companies Act
Marginal note:1991, c. 47, par. 753(b)
523. (1) The portion of subsection 382(1) of the Act before paragraph (f) is replaced by the following:
Marginal note:Exemption by order of Minister
382. (1) An entity that controls a company and that is
(a) a widely held bank,
(b) a bank that would be in compliance with section 379 if it were a company,
(b.1) a widely held bank holding company,
(b.2) a bank holding company that would be in compliance with section 379 if it were a company,
(c) a company that is in compliance with section 379,
(d) an insurance company, other than a mutual company, to which the Insurance Companies Act applies that would be in compliance with section 379 if it were a company,
(d.1) a mutual company or a fraternal benefit society to which the Insurance Companies Act applies,
(d.2) an insurance holding company that would be in compliance with section 379 if it were a company,
(e) an association to which the Cooperative Credit Associations Act applies,
(2) Paragraph 382(5)(a) of the Act is replaced by the following:
(a) the entity that applied for the exemption order ceases to control the company;
Marginal note:1997, c. 15, s. 374
524. Sections 384 to 386 of the Act are replaced by the following:
Marginal note:Acquisition of control permitted
384. (1) Subject to subsection (2) and sections 376 and 385, section 379 does not apply in respect of a company if a person acquires control of a company with equity of one billion dollars or more through the purchase or other acquisition of all or any number of the shares of the company by the person or by any entity controlled by the person.
Marginal note:Undertaking required
(2) Subsection (1) applies only if the person provides the Minister with an undertaking satisfactory to the Minister to do all things necessary so that, within three years after the acquisition, or any other period that the Minister may specify, the company has voting shares that carry at least 35 per cent of the voting rights attached to all of the outstanding voting shares of the company and that are
(a) shares of one or more classes of shares that are listed and posted for trading on a recognized stock exchange in Canada; and
(b) shares none of which is beneficially owned by a person who is a major shareholder of the company in respect of the voting shares of the company or by any entity that is controlled by a person who is a major shareholder of the company in respect of such shares.
Marginal note:Application of section 379
385. At the expiration of the period for compliance with an undertaking referred to in subsection 384(2), section 379 shall apply in respect of the company to which the undertaking relates.
Marginal note:Restriction on voting rights
386. (1) If, with respect to any company, a particular person contravenes section 375 or 375.1 or fails to comply with an undertaking referred to in subsection 384(2) or with any term or condition imposed under section 389, no person, and no entity controlled by the particular person, shall, in person or by proxy, exercise any voting rights
(a) that are attached to shares of the company beneficially owned by the particular person or any entity controlled by the particular person; or
(b) that are subject to an agreement entered into by the particular person, or any entity controlled by the particular person, pertaining to the exercise of the voting rights.
Marginal note:Subsection (1) ceases to apply
(2) Subsection (1) ceases to apply in respect of a person when, as the case may be,
(a) the shares to which the contravention relates have been disposed of;
(b) the person ceases to control the company within the meaning of paragraph 3(1)(d);
(c) if the person failed to comply with an undertaking referred to in subsection 384(2), the company complies with section 379; or
(d) if the person failed to comply with a term or condition imposed under section 389, the person complies with the term or condition.
525. Section 387 of the Act is replaced by the following:
Marginal note:Application for approval
387. (1) An application for an approval of the Minister required under this Part must be filed with the Superintendent and contain the information, material and evidence that the Superintendent may require.
Marginal note:Applicant
(2) If, with respect to any particular transaction, this Part applies to more than one person, any one of those persons may make the application to the Minister for approval on behalf of all of those persons.
526. Subsection 388(1) of the Act is replaced by the following:
Marginal note:Matters for consideration
388. (1) Subject to subsection (2), if an application for an approval under section 375 is made, the Minister, in determining whether or not to approve the transaction, shall take into account all matters that the Minister considers relevant to the application, including
(a) the nature and sufficiency of the financial resources of the applicant or applicants as a source of continuing financial support for the company;
(b) the soundness and feasibility of the plans of the applicant or applicants for the future conduct and development of the business of the company;
(c) the business record and experience of the applicant or applicants;
(d) the character and integrity of the applicant or applicants or, if the applicant or any of the applicants is a body corporate, its reputation for being operated in a manner that is consistent with the standards of good character and integrity;
(e) whether the company will be operated responsibly by persons with the competence and experience suitable for involvement in the operation of a financial institution;
(f) the impact of any integration of the businesses and operations of the applicant or applicants with those of the company on the conduct of those businesses and operations; and
(g) the best interests of the financial system in Canada.
527. Section 389 of the Act is replaced by the following:
Marginal note:Terms and conditions
389. The Minister may impose any terms and conditions in respect of an approval given under this Part that the Minister considers necessary to ensure compliance with any provision of this Act.
528. (1) Subsection 390(1) of the Act is replaced by the following:
Marginal note:Certifying receipt of application
390. (1) If, in the opinion of the Superintendent, an application filed under this Part contains all the required information, the Superintendent shall without delay refer the application to the Minister and send a receipt to the applicant certifying the date on which the completed application was received by the Superintendent.
(2) Subsection 390(2) of the English version of the Act is replaced by the following:
Marginal note:Incomplete application
(2) If, in the opinion of the Superintendent, an application filed under this Part is incomplete, the Superintendent shall send a notice to the applicant specifying the information required by the Superintendent to complete the application.
Marginal note:1996, c. 6, s. 119
529. (1) Subsection 401(1) of the Act is replaced by the following:
Marginal note:Disposition of shareholdings
401. (1) If, with respect to any company, a person contravenes section 375 or 375.1 or fails to comply with an undertaking referred to in subsection 384(2) or with any terms and conditions imposed under section 389, the Minister may, if the Minister deems it in the public interest to do so, by order, direct that person and any person controlled by that person to dispose of any number of shares of the company beneficially owned by any of those persons that the Minister specifies in the order, within the time specified in the order and in the proportion, if any, as between the person and the persons controlled by that person that is specified in the order.
(2) Subsection 401(4) of the Act is repealed.
Marginal note:1997, c. 15, ss. 375(1) to (3)
530. (1) The portion of subsection 410(1) of the Act before paragraph (e) is replaced by the following:
Marginal note:Additional activities
410. (1) In addition, a company may
(a) act as an agent for vendors, purchasers, mortgagors, mortgagees, lessors or lessees of real property and provide consulting or appraisal services in respect of real property;
(b) hold, manage and otherwise deal with real property;
(c) outside Canada, or with the prior written approval of the Minister, in Canada, engage in any of the following activities, namely,
(i) collecting, manipulating and transmitting
(A) information that is primarily financial or economic in nature,
(B) information that relates to the business of a permitted entity, as defined in subsection 449(1), or
(C) any other information that the Minister may, by order, specify,
(ii) providing advisory or other services in the design, development or implementation of information management systems,
(iii) designing, developing or marketing computer software, and
(iv) designing, developing, manufacturing or selling, as an ancillary activity to any activity referred to in any of subparagraphs (i) to (iii) that the company is engaging in, computer equipment integral to the provision of information services related to the business of financial institutions or to the provision of financial services;
(c.1) with the prior written approval of the Minister, develop, design, hold, manage, manufacture, sell or otherwise deal with data transmission systems, information sites, communication devices or information platforms or portals that are used
(i) to provide information that is primarily financial or economic in nature,
(ii) to provide information that relates to the business of a permitted entity, as defined in subsection 449(1), or
(iii) for a prescribed purpose or in prescribed circumstances;
(d) in Canada, engage in such activities referred to in paragraph (c) that the company was engaged in prior to June 1, 1992;
(d.1) engage, under prescribed terms and conditions, if any are prescribed, in specialized business management or advisory services;
(2) Subsection 410(3) of the Act is amended by striking out the word “and” at the end of paragraph (a), by adding the word “and” at the end of paragraph (b) and by adding the following after paragraph (b):
(c) respecting the circumstances in which companies may be exempted from the requirement to obtain the approval of the Minister before carrying on a particular activity referred to in paragraph (1)(c) or (c.1).
531. Paragraphs 411(a) and (b) of the Act are replaced by the following:
(a) act as agent for any person in respect of the provision of any service that is provided by a financial institution, a permitted entity as defined in subsection 449(1) or a prescribed entity and may enter into an arrangement with any person in respect of the provision of that service; or
(b) refer any person to any such financial institution or entity.
532. (1) The portion of subsection 414(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Restriction on guarantees
414. (1) A company shall not guarantee on behalf of any person the payment or repayment of any sum of money unless
Marginal note:1997, c. 15, s. 376
(2) Subsection 414(2) of the French version of the Act is replaced by the following:
Marginal note:Exception
(2) Dans les cas où la personne visée au paragraphe (1) est une filiale de la société garante, celle-ci peut garantir une somme qui n’est pas fixe.
533. Section 417 of the Act is replaced by the following:
Marginal note:Restriction on leasing
417. A company shall not engage in Canada in any personal property leasing activity in which a financial leasing entity, within the meaning of subsection 449(1), is not permitted to engage.
Marginal note:1999, c. 31, s. 219(E)
534. Section 419 of the Act is replaced by the following:
Marginal note:Policies re security interests
419. (1) The directors of a company shall establish and the company shall adhere to policies regarding the creation of security interests in property of the company to secure obligations of the company and the acquisition by the company of beneficial interests in property that is subject to security interests.
Marginal note:Order to amend policies
(2) The Superintendent may, by order, direct a company to amend its policies as specified in the order.
Marginal note:Compliance
(3) A company shall comply with an order made under subsection (2) within the time specified in the order.
Marginal note:Regulations and guidelines
419.1 The Governor in Council may make regulations and the Superintendent may make guidelines respecting the creation by a company of security interests in its property to secure obligations of the company and the acquisition by the company of beneficial interests in property that is subject to security interests.
Marginal note:Exception
419.2 Sections 419 and 419.1 do not apply in respect of a security interest created by a company to secure an obligation of the company to the Bank of Canada or the Canada Deposit Insurance Corporation.
535. Subsection 421(1) of the Act is replaced by the following:
Marginal note:Restriction on partnerships
421. (1) Except with the approval of the Superintendent, a company may not be a general partner in a limited partnership or a partner in a general partnership.
536. Subsection 423(6) of the Act is replaced by the following:
Marginal note:Execution of trust
(6) A company is not bound to see to the execution of any trust to which any deposit made under the authority of this Act is subject, other than a trust of which the company is a trustee.
Marginal note:Payment when company has notice of trust
(7) Subsection (6) applies regardless of whether the trust is express or arises by the operation of law, and it applies even when the company has notice of the trust if it acts on the order of or under the authority of the holder or holders of the account into which the deposit is made.
537. The heading “Interest and Charges” before section 426 of the Act is repealed.
538. The Act is amended by adding the following before section 426:
Marginal note:Definitions
425.1 The following definitions apply in this section and in sections 431 to 434, 444.1 and 444.3.
“member company”
« société membre »
“member company” means a company that is a member institution as defined in section 2 of the Canada Deposit Insurance Corporation Act.
“personal deposit account”
« compte de dépôt personnel »
“personal deposit account” means a deposit account in the name of one or more natural persons that is kept by that person or those persons for a purpose other than that of carrying on business.
“retail deposit account”
« compte de dépôt de détail »
“retail deposit account” means a personal deposit account that is opened with a deposit of less than $150,000 or any greater amount that may be prescribed.
539. Subsection 427(2) of the Act is replaced by the following:
Marginal note:Exception
(2) Subsection (1) does not apply in respect of an interest-bearing deposit account that is opened with a deposit in excess of $150,000 or any greater amount that may be prescribed.
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