Budget Implementation Act, 2023, No. 1 (S.C. 2023, c. 26)

Marginal note:Requirement to relinquish control

652 If no action has been taken by the Superintendent under section 651 and, after 30 days following the taking of control by the Superintendent under subsection 648(1) or (1.11) of a bank or of the assets of a bank, 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,

Marginal note:Advisory committee

653 The Superintendent may, from among the banks and authorized foreign banks 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 bank under subsection 648(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 bank.

Marginal note:Expenses payable by bank

• 654 (1) If the Superintendent has taken control of a bank under subparagraph 648(1)(b)(iii) or paragraph 648(1.11)(d) and the control expires or is relinquished under section 650 or paragraph 652(a), the Superintendent may direct that the bank be liable for repayment of all or part of the expenses resulting from the taking of control of the bank and assessed against and paid by other banks and by authorized foreign banks 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.

Marginal note:Priority of claim in liquidation

655 In the case of the winding-up of a bank, the expenses resulting from the taking of control of the bank under subsection 648(1) or (1.11) and assessed against and paid by other banks and by authorized foreign banks 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 bank that ranks after all other claims but prior to any claim in respect of the shares or membership shares of the bank.

Marginal note:Policies and procedures — integrity or security

664.1 A bank holding company shall establish and adhere to policies and procedures to protect itself against threats to its integrity or security, including foreign interference.

• (c) determine whether the bank holding company has adequate policies and procedures to protect itself against threats to its integrity or security.

Marginal note:Examination of bank holding companies

• 957 (1) The Superintendent, from time to time, shall make or cause to be made any examination and inquiry into the business and affairs of each bank holding company that the Superintendent considers to be necessary or expedient to determine whether the bank holding company is complying with the provisions of this Act and to ascertain the financial condition of the bank holding company or to determine whether the bank holding company has adequate policies and procedures to protect itself against threats to its integrity or security.

Marginal note:Prudential agreement

959 The Superintendent may enter into an agreement, called a “prudential agreement”, with a bank holding company for the purposes of implementing any measure designed to protect the interests of depositors, policyholders and creditors of any federal financial institution affiliated with it or establishing adequate policies and procedures to protect the bank holding company against threats to its integrity or security.

• Marginal note:Directions — policies and procedures

  (1.1) If, in the opinion of the Superintendent, a bank holding company does not have adequate policies and procedures to protect itself against threats to its integrity or security, the Superintendent may direct the bank holding company to take any measures that in the opinion of the Superintendent are necessary to remedy the situation.

• Marginal note:Opportunity for representations

  (2) Subject to subsection (4), no direction shall be issued under subsection (1) or (1.1) unless the bank holding company is provided with a reasonable opportunity to make representations in respect of the matter.

• Marginal note:Temporary direction

  (3) If, in the opinion of the Superintendent, the length of time required for representations to be made might be prejudicial to the public interest, the Superintendent may make a temporary direction with respect to the matters referred to in paragraphs (1)(a) to (d) or subsection (1.1) having effect for a period of not more than 15 days.

Marginal note:Exécution judiciaire

• 961 (1) En cas de manquement soit à un accord prudentiel conclu en vertu de l’article 959, soit à une décision prise en vertu de l’article 960, soit à une disposition de la présente loi — notamment une obligation — , le surintendant peut, en plus de toute autre mesure qu’il est déjà habilité à prendre sous le régime de celle-ci, demander à un tribunal de rendre une ordonnance obligeant la société de portefeuille bancaire en faute à mettre fin ou à remédier au manquement, ou toute autre ordonnance qu’il juge indiquée en l’espèce.

Marginal note:Minister — terms, conditions and undertakings

• 973.02 (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.

• 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 amendment or suspension

  (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.

Marginal note:Confidential undertaking

• 973.031 (1) If, in the Minister’s opinion, the disclosure of information about an undertaking required under subsection 973.02(1) or 973.03(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.

Marginal note:Appeal to Federal Court

• 977 (1) An appeal lies to the Federal Court from any direction of the Minister made under subsection 401.2(7), 402(1), 402.2(1), 913(7) or 915(1).

Marginal note:Policies and procedures — integrity or security

15.1 A company or society shall establish and adhere to policies and procedures to protect itself against threats to its integrity or security, including foreign interference.

• (e) a person who is prohibited by subsection 164.08(8) or section 418 or 430 from exercising voting rights attached to shares of the company or whose voting rights attached to the shares are suspended under section 432.1 or subsection 1016.3(4);

• (f) a person who is an officer, director or full time employee of an entity that is prohibited by subsection 164.08(8) or section 418 or 430 from exercising voting rights attached to shares of the company or whose voting rights attached to the shares are suspended under section 432.1 or subsection 1016.3(4);

Marginal note:Disposition — threat to integrity or security

• 432.1 (1) If the Minister is of the opinion that a person’s holding or beneficial ownership of shares of a company poses a threat to the integrity or security of the company or the financial system in Canada or a threat to national security, the Minister may, by order, direct that person and any person controlled by that person to dispose of any number of shares of the company held or beneficially owned by any of the 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 the person that is specified in the order.

• Marginal note:Suspension of rights

  (2) A direction made under subsection (1) may also suspend any of the rights under Part VI attached to the shares referred to in that subsection until the shares are disposed of in accordance with the direction.

• Marginal note:Representations

  (3) No direction shall be made under subsection (1) unless the Minister has provided each person to whom the direction relates and the company concerned with a reasonable opportunity to make representations.

• Marginal note:Temporary direction

  (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 make a temporary direction to suspend any of the rights under Part VI attached to any of the shares referred to in subsection (1).

• Marginal note:Cessation of effect

  (5) A temporary direction 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 in the temporary direction, and

  • (b) if a direction is made under subsection (1) in respect of the shares, the day on which that direction takes effect.

• Marginal note:Appeal

  (6) Any person with respect to whom a direction has been made under subsection (1) may, within 30 days after the day on which the direction was made, appeal the matter in accordance with section 1020.

• Marginal note:Notice — Committee and Review Agency

  (7) If a direction has been made under subsection (1) or (4) for reasons related to national security, the Minister shall, within 30 days after the day on which the direction was made, 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.