Canada Deposit Insurance Corporation Act

Marginal note:Restructuring transactions

• 39.2 (1) Where an order has been made under paragraph 39.13(1)(a), the Corporation may, in addition to and not in lieu of any other of its rights and powers, carry out, or cause the federal member institution to carry out,

  • (a) a transaction or series of transactions that involves the sale of all or part of the shares or subordinated debt of the federal member institution;

  • (b) a transaction that involves the amalgamation of the federal member institution;

  • (c) a transaction or series of transactions that involves the sale or other disposition by the federal member institution of all or part of its assets or the assumption of all or part of its liabilities, or both; or

  • (d) any other transaction or series of transactions the purpose of which is to restructure a substantial part of the business of the federal member institution.

• Marginal note:Transactions for disposition of assets, etc., or restructuring

  (2) Where an order has been made under paragraph 39.13(1)(b), the Corporation, as receiver, may, in addition to any other of its rights and powers, carry out

  • (a) a transaction or series of transactions that involves the sale or other disposition by the Corporation as receiver of all or part of the assets of the federal member institution or the assumption by another person of all or part of its liabilities, or both; or

  • (b) any other transaction or series of transactions the purpose of which is to restructure a substantial part of the business of the federal member institution.

• Marginal note:Completion of transaction

  (3) Where the Corporation considers that a transaction or series of transactions referred to in subsection (1) or (2) has been substantially completed, it shall cause a notice to that effect, specifying the date on which the transaction or series of transactions was, in the opinion of the Corporation, substantially completed, to be published in the Canada Gazette.

• Marginal note:Negative pledges inapplicable

  (4) No restriction on the right of the federal member institution to amalgamate, to sell or otherwise dispose of any of its assets or to provide for the assumption of any of its liabilities, other than a restriction provided for in an Act of Parliament, applies so as to prevent the Corporation, the federal member institution or any other person from carrying out a transaction described in subsection (1) or (2).

• Marginal note:Approval by Minister

  (5) A transaction referred to in subsection (1) or (2) has no force or effect until it is approved by the Minister, unless it is between the Corporation, as receiver for a federal member institution, and a bridge institution.

• Marginal note:Novation

  (6) Any person who assumes a liability of the federal member institution under a transaction referred to in subsection (1) or (2) becomes liable — instead of the federal member institution — to discharge the liability, on approval of the transaction by the Minister or as soon as the person assumes the liability if the transaction does not require the Minister’s approval.

• Marginal note:Exception

  (7) Subsection (6) does not apply to the bridge institution’s assumption of any portion of the federal member institution’s liability that is not insured by the Corporation.

• Marginal note:Novation — trust

  (8) A trust company within the meaning of subsection 57(2) of the Trust and Loan Companies Act that is designated as a bridge institution may become a trustee in substitution for the federal member institution without formality or the consent of any beneficiary of the trust.