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Bank Act (S.C. 1991, c. 46)

Full Document:  

Act current to 2019-09-10 and last amended on 2019-06-21. Previous Versions

PART XIIForeign Banks (continued)

DIVISION 5Approvals (continued)

Approvals in Respect of Investments and Activities

Marginal note:Minister’s approval

  •  (1) Subject to subsection (2) and the regulations, a foreign bank or an entity associated with a foreign bank may not, without the prior written approval of the Minister,

    • (a) acquire control of a Canadian entity referred to in any of paragraphs 468(1)(g) to (i) from a person who is not a member of the foreign bank’s group;

    • (b) acquire control of a Canadian entity whose business includes one or more of the activities referred to in paragraph 522.08(1)(a) and that engages, as part of its business, in any financial intermediary activity that exposes the Canadian entity to material market or credit risk — including a finance entity — if the control is acquired from an entity referred to in any of paragraphs 468(1)(a) to (f) that is not a member of the foreign bank’s group, but does not include a Canadian entity whose activities are limited to the activities of one or more of the following entities:

      • (i) a factoring entity as defined in the regulations, or

      • (ii) a financial leasing entity;

    • (c) acquire or hold control of, or a substantial investment in, a Canadian entity whose business includes one or more of the activities referred to in paragraph 522.08(1)(d);

    • (d) acquire or hold control of, or a substantial investment in, a Canadian entity that engages in Canada in an activity described in paragraph 410(1)(c);

    • (d.1) acquire or hold control of, or a substantial investment in, a Canadian entity that engages in an activity described in paragraph 410(1)(c.1);

    • (e) acquire or hold control of, or a substantial investment in, a Canadian entity that engages in an activity prescribed for the purposes of paragraph 522.08(1)(f);

    • (f) engage in or carry on a business permitted by paragraph 522.18(1)(a) or (b) or subsection 522.18(2);

    • (g) acquire or hold control of, or a substantial investment in, a limited commercial entity;

    • (h) maintain a branch or engage in or carry on a business permitted by section 522.19; or

    • (i) engage in an activity referred to in paragraph 510(1)(c) in the circumstances described in paragraph 513(1)(a) or (2)(c).

  • Marginal note:Approval for indirect investments

    (2) Subject to the regulations, if a foreign bank or an entity associated with a foreign bank

    • (a) obtains the approval of the Minister under any of paragraphs (1)(a) to (e) and (g) to acquire or hold control of, or a substantial investment in, a Canadian entity, and

    • (b) through that acquisition or holding, indirectly acquires control of, or a substantial investment in, another Canadian entity that would require the approval of the Minister under any of those paragraphs,

    and that indirect acquisition is disclosed to the Minister in writing before the approval is obtained, the foreign bank or the entity associated with a foreign bank is deemed to have obtained the approval of the Minister for that indirect acquisition.

  • Marginal note:Ministerial approval of more than one entity

    (3) If the Minister, under paragraph (1)(g), approves the acquisition or holding of control of, or a substantial investment in, a limited commercial entity by a foreign bank or by an entity associated with a foreign bank, the Minister may also authorize the foreign bank or entity associated with a foreign bank to, at any time, acquire and hold control of, or a substantial investment in, another limited commercial entity that engages in activities that are substantially the same as those engaged in by the Canadian entity in respect of which the approval was given.

  • Marginal note:Substantial investment by underwriter

    (4) Nothing in this Part precludes a foreign bank or an entity associated with a foreign bank from acquiring a substantial investment in a Canadian entity if the substantial investment is acquired in the course of a distribution to the public of shares or ownership interests in the Canadian entity by a securities underwriter so long as the securities underwriter holds the substantial investment for no longer than six months.

  • Marginal note:Application

    (5) Subsection (1) applies regardless of whether or not the approval of the Minister is required under section 522.21 or 522.211.

  • 2001, c. 9, s. 132
  • 2007, c. 6, s. 68

DIVISION 6Administration

Marginal note:Regulations

 The Governor in Council may make regulations for the purposes of this Part and, in particular, may make regulations

  • (a) concerning specialized financing;

  • (b) for the purposes of subsection 522.22(1) or (2), permitting the acquisition or holding of control or the acquisition or holding of substantial investments, or prescribing the circumstances under which either of those subsections does not apply or the foreign banks, entities associated with foreign banks or other entities in respect of which either of those subsections does not apply, including prescribing foreign banks, entities associated with foreign banks or other entities on the basis of the activities they engage in;

  • (c) restricting the ownership by foreign banks, or entities associated with foreign banks, of shares in a body corporate or of ownership interests in an unincorporated entity under Division 3 or 4 and imposing terms and conditions applicable to foreign banks, or entities associated with foreign banks, that own such shares or interests;

  • (d) in respect of sections 409 to 411, for the purposes of paragraph 522.08(1)(a), subsection 522.22(1) and section 522.24;

  • (e) respecting the calculation referred to in subsection 508(2), including regulations respecting the classes of entities associated with a foreign bank, and the classes of foreign banks described in any of subparagraphs 508(1)(a)(i) to (iii) that are associated with a foreign bank, that are to be taken into account in that calculation;

  • (f) defining any terms in subsection 508(2);

  • (g) respecting exemptions under subsection 508(3); and

  • (h) defining factoring entity for the purpose of paragraph 522.22(1)(b).

  • 2001, c. 9, s. 132
  • 2007, c. 6, s. 69

Marginal note:Application of regulations

 Any regulations made for the purposes of sections 409 to 411 apply for the purposes of paragraph 522.08(1)(a) and subsection 522.22(1) unless otherwise provided in the regulations.

  • 2001, c. 9, s. 132

Marginal note:Divestiture

  •  (1) If a foreign bank or an entity associated with a foreign bank contravenes any provision of Division 4 or fails to comply with any terms and conditions imposed by any order made for the purpose of any of those provisions, the Minister may, if the Minister considers it in the public interest to do so, by order, direct the foreign bank or the entity to divest itself of the control of, or a substantial investment in, a bank or bank holding company to which the offence relates.

  • Marginal note:Ceasing to engage in or carry on business

    (2) If an authorized foreign bank or an entity associated with an authorized foreign bank contravenes any provision of Division 4 or fails to comply with any terms and conditions imposed by any order made for the purpose of any of those provisions, the Minister may, if the Minister considers it in the public interest to do so, revoke the order made under subsection 524(1).

  • Marginal note:Divestment order

    (3) The Minister may, by order, direct a foreign bank or an entity associated with a foreign bank, within any period that the Minister considers reasonable, to dispose of assets used in a business or activity engaged in or carried on, or to dispose of the control of an entity or a substantial investment in an entity acquired or held, in contravention of this Part or in contravention of any terms and conditions imposed

    • (a) under subsection 522.26(2); or

    • (b) under subsection 518(4) or 521(1.02), as it read immediately before October 24, 2001.

  • 2001, c. 9, s. 132
  • 2007, c. 6, s. 70

Marginal note:Publication

 The Superintendent must publish in the Canada Gazette a notice of every approval granted for the purpose of section 522.21 or 522.211 and of every revocation of any such approval.

  • 2001, c. 9, s. 132
  • 2007, c. 6, s. 71

Marginal note:Obligation to provide information

 A foreign bank or entity associated with a foreign bank shall, at the times and in the form specified by the Superintendent, provide the Superintendent with the information that he or she may require.

  • 2001, c. 9, s. 132
  • 2007, c. 6, s. 71

DIVISION 7[Repealed, 2007, c. 6, s. 72]

 [Repealed, 2007, c. 6, s. 72]

DIVISION 8Transitional

Marginal note:Definitions

  •  (1) The following definitions apply in this Division.

    affected entity

    affected entity means

    • (a) an entity associated with a foreign bank that is an affected foreign bank and that has a financial establishment in Canada; or

    • (b) a prescribed entity associated with a foreign bank referred to in paragraph (c) of the definition affected foreign bank. (entité visée)

    affected foreign bank

    affected foreign bank means a foreign bank that

    • (a) immediately before the day this Division comes into force, was the subject of an order made under subsection 524(1) or former subsection 521(1.06) and whose order has not been revoked; or

    • (b) on or before June 13, 2000, controlled a foreign bank subsidiary as defined in former section 2.

    • (c) [Repealed, 2007, c. 6, s. 73] (banque étrangère visée)

  • Marginal note:Former provision

    (2) Every reference in this Division to a former provision means a reference to that provision as it read immediately before the day this Division comes into force.

  • 2001, c. 9, s. 132
  • 2007, c. 6, s. 73
 
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