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. 47Insurance Companies Act (continued)
581 Subsection 433(1) of the Act is replaced by the following:
Marginal note:Application to court
433 (1) If a person fails to comply with a direction made under subsection 428(7), 432(1) or 432.1(1), an application on behalf of the Minister may be made to a court for an order to enforce the direction.
582 The Act is amended by adding the following after section 574:
Marginal note:Policies and procedures — integrity or security
574.1 A foreign company shall establish and adhere to policies and procedures to protect itself against threats to its integrity or security in relation to its business in Canada.
583 The Act is amended by adding the following after section 657:
Marginal note:Policies and procedures — integrity or security
657.1 A provincial company shall establish and adhere to policies and procedures to protect itself against threats to its integrity or security, including foreign interference.
584 Subsection 671(1) of the Act is replaced by the following:
Marginal note:Production of information and documents
671 (1) The Superintendent may, by order, direct a person who controls a company or any entity that is affiliated with a company to provide the Superintendent with any information or documents that may be specified in the order if the Superintendent believes that the production of the information or documents is necessary in order to be satisfied that
(a) the provisions of this Act are being duly observed and that the company is in a sound financial condition; or
(b) the company has adequate policies and procedures to protect itself against threats to its integrity or security.
585 (1) Subsection 674(1) of the Act is replaced by the following:
Marginal note:Examination of companies, etc.
674 (1) The Superintendent, from time to time, but at least once in each calendar year, shall make or cause to be made any examination and inquiry into the business and affairs of each company, society, foreign company and provincial company that the Superintendent considers to be necessary or expedient to determine whether the company, society, foreign company or provincial company is complying with the provisions of this Act, whether the company, society or provincial company or the insurance business in Canada of the foreign company is in a sound financial condition and whether the company, society or provincial company has adequate policies and procedures to protect itself against threats to its integrity or security or the foreign company has adequate policies and procedures to protect itself against threats to its integrity or security in relation to its business in Canada. After the conclusion of each examination and inquiry, the Superintendent shall report on it to the Minister.
(2) Section 674 of the Act is amended by adding the following after subsection (1):
Marginal note:Integrity or security
(1.1) The Superintendent, from time to time, shall make or cause to be made any examination and inquiry into the business and affairs of any company, society, foreign company and provincial company that the Superintendent considers to be necessary or expedient to determine whether the company, society or provincial company has adequate policies and procedures to protect itself against threats to its integrity or security or the foreign company has adequate policies and procedures to protect itself against threats to its integrity or security in relation to its business in Canada. After the conclusion of each examination and inquiry, the Superintendent shall report on it to the Minister.
(3) Subsection 674(1.1) of the Act is repealed.
586 Section 675.1 of the Act is replaced by the following:
Marginal note:Prudential agreement
675.1 The Superintendent may enter into an agreement, called a “prudential agreement”, with
(a) a company, society or provincial company for the purposes of implementing any measure designed to maintain or improve its safety and soundness or establishing adequate policies and procedures to protect it against threats to its integrity or security; or
(b) a foreign company for the purposes of implementing any measure designed to protect the interests of its policyholders and creditors in relation to its insurance business in Canada or establishing adequate policies and procedures to protect it against threats to its integrity or security in relation to its business in Canada.
587 Subsections 676(2) and (3) of the Act are replaced by the following:
Marginal note:Directions — policies and procedures
(1.1) If, in the opinion of the Superintendent, a company, society, or provincial company does not have adequate policies and procedures to protect itself against threats to its integrity or security, or a foreign company does not have adequate policies and procedures to protect itself against threats to its integrity or security in relation to its business in Canada, the Superintendent may direct the company, society, foreign company or provincial 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 (3), no direction shall be issued to a company, society, foreign company, provincial company or person under subsection (1) or (1.1) unless the company, society, foreign company, provincial company or person 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 under subsection (2) 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) and (b) or subsection (1.1) having effect for a period of not more than 15 days.
588 Paragraph 678(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 675.1 or a direction of the Superintendent issued to the company, society, foreign company, provincial company or person under subsection 676(1), (1.1.) or (3),
589 Subsection 678.5(1) of the Act is replaced by the following:
Marginal note:Direction to transfer policies or to reinsure risks — society
678.5 (1) If the circumstances described in any of paragraphs 679(1.1)(a) to (e) or (f.1) to (i) exist in respect of a society, the Superintendent may, by order, subject to any terms and conditions the Superintendent may specify, direct it to transfer all or any portion of its policies to, or cause itself to be reinsured, against all or any portion of the risks undertaken under its policies, by any company, society, foreign company or body corporate incorporated or formed by or under the laws of a province that is authorized to transact the classes of insurance to be so transferred or reinsured.
590 Subsection 678.6(1) of the Act is replaced by the following:
Marginal note:Direction to transfer policies or to reinsure risks — foreign fraternal benefit society
678.6 (1) If the circumstances described in any of paragraphs 679(1.2)(a) to (d) or (f) to (h) exist in respect of a foreign fraternal benefit society, the Superintendent may, by order, subject to any terms and conditions the Superintendent may specify, direct it to transfer all or any portion of its policies in respect of its insurance business in Canada to, or cause itself to be reinsured, against all or any portion of the risks undertaken under those policies, by any company, society, foreign company or body corporate incorporated or formed by or under the laws of a province that is authorized to transact the classes of insurance to be so transferred or reinsured.
591 (1) Paragraph 679(1)(b) of the French version of the Act is replaced by the following:
b) sauf avis contraire du ministre fondé sur l’intérêt public, prendre le contrôle pour plus de seize jours de l’actif de la société, la société de secours ou la société provinciale et des éléments d’actif qu’elle administre ou, dans le cas d’une société étrangère, de son actif au Canada ainsi que de ses autres éléments d’actif se trouvant au Canada sous le contrôle de son agent principal, y compris les sommes reçues ou à recevoir pour ses activités d’assurances au Canada, continuer d’en assumer le contrôle au-delà de ce terme ou prendre le contrôle de la société, de la société de secours ou de la société provinciale.
(2) Subsection 679(1.1) of the Act is amended by striking out “or” at the end of paragraph (f) and by adding the following after that paragraph:
(f.1) in the case of a company, in the opinion of the Superintendent, the company’s policyholders or 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;
(3) Subsection 679(1.1) of the Act is amended by adding the following after paragraph (g):
(h) in the opinion of the Superintendent, the continued operation of the company, society or provincial company by its directors or by the officers responsible for its management would be materially prejudicial to its integrity or security; or
(i) in the opinion of the Superintendent, the continued operation of the company, society or provincial company by its directors or by the officers responsible for its management would pose a risk to national security.
(4) Subsection 679(1.2) of the Act is amended by striking out “or” at the end of paragraph (e) and by adding the following after paragraph (f):
(g) in the opinion of the Superintendent, the continued operation of the foreign company in Canada would be materially prejudicial to the integrity or security of its business in Canada; or
(h) in the opinion of the Superintendent, the continued operation of the foreign company in Canada would pose a risk to national security.
(5) Section 679 of the Act is amended by adding the following after subsection (1.2):
Marginal note:Minister’s powers
(1.21) 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, society or provincial company and the assets under its administration or, in the case of a foreign company, of its assets in Canada together with its other assets held in Canada under the control of its chief agent, including all amounts received or receivable in respect of its insurance business in Canada;
(b) take control, for a period exceeding 16 days, of the assets of the company, society or provincial company and the assets under its administration or, in the case of a foreign company, of its assets in Canada together with its other assets held in Canada under the control of its chief agent, including all amounts received or receivable in respect of its insurance business in Canada;
(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, society or provincial company.
(6) Subsection 679(2) of the Act is replaced by the following:
Marginal note:Notice — up to 16 days
(1.4) If the Superintendent takes control of the assets of a company, society, provincial company or foreign company under paragraph (1.21)(a), the Superintendant shall notify the company, society, provincial company or foreign company that control has been taken at the direction of the Minister.
Marginal note:Notice — more than 16 days
(1.5) If the Minister is considering whether to exercise the powers under any of paragraphs (1.21)(b) to (d), the Superintendent shall notify the company, society, provincial company or foreign 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
(1.6) Within 30 days after exercising any of the powers under subsection (1.21), 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 (1.21) of the assets of a company, society, provincial company or foreign company referred to in that subsection, the Superintendent may do all things necessary or expedient to protect the rights and interests of the policyholders and creditors of the company, society or provincial company or the policyholders and creditors in respect of the foreign company’s insurance business in Canada.
(7) The portion of subsection 679(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 (1.21) of the assets of a company, society, provincial company or foreign company referred to in that subsection,
- Date modified: