Budget Implementation Act, 2023, No. 1 (S.C. 2023, c. 26)
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Assented to 2023-06-22
PART 4Various Measures (continued)
DIVISION 33Legislation Related to Financial Institutions (continued)
1991, c. 45Trust and Loan Companies Act (continued)
526 Paragraph 509(1)(a) of the Act is replaced by the following:
(a) is contravening or has failed to comply with a prudential agreement entered into under section 506.1 or a direction of the Superintendent issued to the company or person under subsection 507(1), (1.1) or (3),
527 (1) Subsection 510(1.1) of the Act is amended by striking out “or” at the end of paragraph (g) and by adding the following after that paragraph:
(g.1) in the opinion of the Superintendent, the company’s depositors and creditors may be detrimentally affected because all of the common shares of the company must be disposed of under a direction made by the Minister or because there is a prohibition under this Act in respect of the exercise of the right to vote attached to all of the common shares of the company;
(2) Subsection 510(1.1) of the Act is amended by adding the following after paragraph (h):
(i) in the opinion of the Superintendent, the continued operation of the company by the directors of the company or by the officers of the company responsible for its management would be materially prejudicial to its integrity or security; or
(j) in the opinion of the Superintendent, the continued operation of the company by the directors of the company or by the officers of the company responsible for its management would pose a risk to national security.
(3) Section 510 of the Act is amended by adding the following after subsection (1.1):
Marginal note:Minister’s powers
(1.11) Subject to this Act, the Minister may, for reasons related to national security, direct the Superintendent to
(a) take control, for a period not exceeding 16 days, of the assets of the company and the assets held in trust by or under the administration of the company;
(b) take control, for a period exceeding 16 days, of the assets of the company and the assets held in trust by or under the administration of the company;
(c) if control of assets has been taken under paragraph (a), continue the control beyond the 16 days referred to in that paragraph; or
(d) take control of the company.
(4) Subsection 510(2) of the Act is replaced by the following:
Marginal note:Notice — up to 16 days
(1.3) If the Superintendent takes control of the assets of a company under paragraph (1.11)(a), the Superintendent shall notify the company that control has been taken at the direction of the Minister.
Marginal note:Notice — more than 16 days
(1.4) If the Minister is considering whether to exercise the powers under any of paragraphs (1.11)(b) to (d), the Superintendent shall notify the company of the action that is being considered and of its right to make written representations to the Minister within the time specified in the notice, not exceeding 10 days after it receives the notice.
Marginal note:Notice — Committee and Review Agency
(1.5) Within 30 days after exercising any of the powers under subsection (1.11), the Minister shall notify
(a) the Committee, as defined in section 2 of the National Security and Intelligence Committee of Parliamentarians Act; and
(b) the Review Agency, as defined in section 2 of the National Security and Intelligence Review Agency Act.
Marginal note:Objectives of Superintendent
(2) If the Superintendent has control under subsection (1) or (1.11) of the assets of a company referred to in that subsection, the Superintendent may do all things necessary or expedient to protect the rights and interests of the depositors and creditors of the company or the beneficiaries of any trust under the administration of the company.
(5) The portion of subsection 510(3) of the Act before paragraph (a) is replaced by the following:
Marginal note:Powers of Superintendent
(3) If the Superintendent has control under subsection (1) or (1.11) of the assets of a company referred to in that subsection,
528 (1) Subsection 514(1) of the English version of the Act is replaced by the following:
Marginal note:Powers of directors and officers suspended
514 (1) If the Superintendent takes control of a company under subparagraph 510(1)(b)(iii) or paragraph 510(1.11)(d), the powers, duties, functions, rights and privileges of the directors of the company and of the officers of the company responsible for its management are suspended.
(2) The portion of subsection 514(2) of the English version of the Act before paragraph (a) is replaced by the following:
Marginal note:Superintendent to manage company
(2) If the Superintendent takes control of a company under subparagraph 510(1)(b)(iii) or paragraph 510(1.11)(d), the Superintendent shall manage the business and affairs of the company and in so doing the Superintendent
(3) Subsection 514(3) of the English version of the Act is replaced by the following:
Marginal note:Persons to assist
(3) If the Superintendent takes control of a company under subparagraph 510(1)(b)(iii) or paragraph 510(1.11)(d), the Superintendent may appoint one or more persons to assist in the management of the company.
529 Section 515 of the Act is renumbered as subsection 515(1) and is amended by adding the following:
Marginal note:Expiration of control — Minister’s direction
(2) Control by the Superintendent under subsection 510(1.11) of a company or of the assets of a company and the assets held in trust by or under the administration of the company expires on the day on which a notice by the Superintendent is sent to the directors and officers who conducted the business and affairs of the company stating that the Minister is of the opinion, on the recommendation of the Superintendant, that corrective measures have been taken in response to the reasons related to national security and that the company can resume control of its business and affairs.
530 Paragraphs 515.1(a) and (b) of the Act are replaced by the following:
(a) the assets of the company and the assets held in trust by or under the administration of the company are under the control of the Superintendent under subparagraph 510(1)(b)(i) or (ii) or paragraph 510(1.11)(b) or (c); or
(b) the company is under the control of the Superintendent under subparagraph 510(1)(b)(iii) or paragraph 510(1.11)(d).
531 The portion of section 516 of the English version of the Act before paragraph (a) is replaced by the following:
Marginal note:Requirement to relinquish control
516 If no action has been taken by the Superintendent under section 515.1 and, after 30 days following the taking of control by the Superintendent under subsection 510(1) or (1.11) of a company or of the assets of a company and the assets held in trust by or under the administration of the company, the Superintendent receives from its board of directors a notice in writing requesting the Superintendent to relinquish control, the Superintendent shall, not later than 12 days after receipt of the notice,
532 Section 517 of the English version of the Act is replaced by the following:
Marginal note:Advisory committee
517 The Superintendent may, from among the companies that are subject to an assessment under section 23 of the Office of the Superintendent of Financial Institutions Act and required to share in the expenses resulting from the taking of control of a company under subsection 510(1) or (1.11), appoint a committee of not more than six members to advise the Superintendent in respect of assets, management and all other matters pertinent to the duties and responsibilities of the Superintendent in exercising control of the company.
533 Subsection 518(1) of the English version of the Act is replaced by the following:
Marginal note:Expenses payable by company
518 (1) If the Superintendent has taken control of a company under subparagraph 510(1)(b)(iii) or paragraph 510(1.11)(d) and the control expires or is relinquished under section 515 or paragraph 516(a), the Superintendent may direct that the company be liable for repayment of all or part of the expenses resulting from the taking of control of the company and assessed against and paid by other companies under section 23 of the Office of the Superintendent of Financial Institutions Act, together with any interest in respect of the expenses at any rate that is specified by the Superintendent.
534 Section 519 of the English version of the Act is replaced by the following:
Marginal note:Priority of claim in liquidation
519 In the case of the winding-up of a company, the expenses resulting from the taking of control of the company under subsection 510(1) or (1.11) and assessed against and paid by other companies under section 23 of the Office of the Superintendent of Financial Institutions Act, and interest in respect of the expenses at any rate that is specified by the Superintendent, constitute a claim of His Majesty in right of Canada against the assets of the company that ranks after all other claims but prior to any claim in respect of the shares of the company.
535 Subsection 527.4(1) of the Act is replaced by the following:
Marginal note:Minister — terms, conditions and undertakings
527.4 (1) In addition to any other action that may be taken under this Act, the Minister may, in granting an approval, impose any terms and conditions or require any undertaking that the Minister considers appropriate, including any terms, conditions or undertakings specified by the Superintendent to maintain or improve the safety and soundness of any financial institution regulated under an Act of Parliament to which the approval relates or that might be affected by it or to ensure that such a financial institution has adequate policies and procedures to protect itself against threats to its integrity or security.
536 Subsection 527.5(3) of the Act is replaced by the following:
Marginal note:Representations
(3) Before taking any action under subsection (1) or (2), the Minister or the Superintendent, as the case may be, shall give the person concerned a reasonable opportunity to make representations.
Marginal note:Temporary suspension or amendment
(4) If, in the Minister’s opinion, the length of time required for representations to be made under subsection (3) might be prejudicial to the public interest, the Minister may temporarily suspend or amend any approval granted by the Minister.
Marginal note:Cessation of effect
(5) A temporary suspension or amendment of an approval ceases to have effect on the earlier of
(a) the expiry of 30 days after the day on which it takes effect or of a shorter period that is specified by the Minister, and
(b) if the approval is revoked, suspended or amended under subsection (1), the day on which the revocation, suspension or amendment takes effect.
537 The Act is amended by adding the following after section 527.5:
Marginal note:Confidential undertaking
527.51 (1) If, in the Minister’s opinion, the disclosure of information about an undertaking required under subsection 527.4(1) or 527.5(1) or (4), or information that could reveal the existence of the undertaking, could pose a threat to the integrity or security of the financial institution to which the undertaking relates or could be injurious to national security, the Minister may specify that the information is confidential and shall be treated accordingly.
Marginal note:Prohibition
(2) Despite anything in this Act but subject to subsection (3), it is prohibited to disclose any confidential information referred to in subsection (1) except in accordance with any terms or conditions that the Minister may specify in the undertaking.
Marginal note:Notice — Committee and Review Agency
(3) If the Minister specifies under subsection (1) that information referred to in that subsection is confidential for reasons related to national security, the Minister shall, within 30 days after the day on which the undertaking in question is required, notify
(a) the Committee, as defined in section 2 of the National Security and Intelligence Committee of Parliamentarians Act; and
(b) the Review Agency, as defined in section 2 of the National Security and Intelligence Review Agency Act.
538 Subsection 530(1) of the Act is replaced by the following:
Marginal note:Appeal to Federal Court
530 (1) An appeal lies to the Federal Court from any direction of the Minister made under subsection 396(7), 401(1) or 401.1(1).
- Date modified: