Canada Pension Plan

Marginal note:Definitions

• 110 (1) In this section and sections 113 and 117,

  appropriate provincial Minister

  ministre provincial compétent

  appropriate provincial Minister, in respect of a province, means the province’s minister of the Crown who has primary responsibility for that province’s finances; (ministre provincial compétent)

  Investment Board

  Investment Board[Repealed, 2003, c. 5, s. 5]

  operating balance

  operating balance[Repealed, 2003, c. 5, s. 5]

  province

  province[Repealed, R.S., 1985, c. 30 (2nd Supp.), s. 55]

  security

  titre

  security means

  • (a) an obligation

    • (i) that was held to the credit of the Canada Pension Plan Investment Fund before the coming into force of the Canada Pension Plan Investment Board Act,

    • (ii) that, as applied to Canada, is an obligation of the Government of Canada and, as applied to a province, is an obligation of the government of the province or an obligation of any agent of Her Majesty in right of the province that is guaranteed as to principal and interest by that government, and

    • (iii) that complies with the conditions that were set out in section 111 as that section read before the coming into force of the Canada Pension Plan Investment Board Act, or

  • (b) an obligation that

    • (i) is purchased by the Minister of Finance under this section after the coming into force of the Canada Pension Plan Investment Board Act, and

    • (ii) is an obligation of the government of a province or an obligation of any agent of Her Majesty in right of a province that is guaranteed as to principal and interest by that government. (titre)

• Marginal note:Interest shall be charged to Account

  (2) The Minister of Finance shall charge interest to the Canada Pension Plan Account at market rates, as determined by that Minister, on any amount paid out of the Consolidated Revenue Fund under subsection 108(3) that exceeds the balance to the credit of the Canada Pension Plan Account. Interest shall be charged for the period beginning on the day on which the amount is paid out of the Consolidated Revenue Fund under subsection 108(3) and ending on the day on which the Investment Board pays that amount into the Consolidated Revenue Fund under section 56 of the Canada Pension Plan Investment Board Act.

• Marginal note:Additional interest

  (2.1) Where an amount referred to in paragraph 108(3)(a) is charged to the Canada Pension Plan Account pursuant to subsection (3), interest shall, notwithstanding that the amount has been so charged, be credited to the Canada Pension Plan Account, at the prescribed time and in the prescribed manner, in respect of that amount until the amount is effectively paid out of the Consolidated Revenue Fund.

• Marginal note:Replacement security

  (3) On the maturity of a security of a province held to the credit of the Canada Pension Plan Investment Fund that was issued before January 1, 1998, the Minister of Finance shall purchase another security issued by the province if requested to do so, in writing, by the appropriate provincial Minister of that province at least 30 days before the date of maturity.

• Marginal note:Principal amount

  (4) The principal amount of the replacement security shall be not more than the principal outstanding under the maturing security.

• Marginal note:Term to maturity

  (5) The replacement security shall be for a term of 20 years.

• Marginal note:Interest

  (6) The replacement security shall bear interest at a rate fixed by the Minister of Finance. In fixing that rate, the Minister of Finance shall choose a rate that is substantially the same as the interest rate that the province would be required to pay if it were to borrow the same amount for the same term through the issuance of a security on the public capital market.

• Marginal note:Features of replacement security

  (6.1) The replacement security shall be issued to or payable to the credit of the Canada Pension Plan Investment Fund and shall be expressed to be not negotiable and not transferable or assignable.

• (6.2) and (6.3) [Repealed, 2003, c. 5, s. 5]

• Marginal note:Redemption at request of province

  (6.4) The Minister of Finance shall redeem a security in whole or in part before maturity if

  • (a) the Minister of Finance is requested to do so, in writing, by the appropriate provincial Minister of a province at least 30 days before the proposed redemption date; and

  • (b) the appropriate provincial Minister has agreed to pay on the redemption date

    • (i) any payments of principal or interest due on or before the redemption date but not yet paid,

    • (ii) interest on the principal amount being redeemed accrued to the date of redemption, and

    • (iii) an amount equal to the present value of the remaining instalments of principal being redeemed and interest on that principal.

• Marginal note:Calculation of present value

  (6.5) For the purposes of subparagraph (6.4)(b)(iii), the present value shall be calculated by discounting the instalments of principal being redeemed and interest on that principal using an interest rate fixed by the Minister of Finance. In fixing that rate, the Minister of Finance shall choose a rate that

  • (a) if the security to be redeemed was issued before January 1, 1998, is substantially the same as the rate the Government of Canada would be required to pay if it were to borrow the principal amount being redeemed for a term equal to the remaining term of the security to be redeemed through the issuance of a security on the public capital market; or

  • (b) if the security to be redeemed was issued after January 1, 1998, is substantially the same as the rate the province would be required to pay if it were to borrow the principal amount being redeemed for a term equal to the remaining term of the security to be redeemed through the issuance of a security on the public market.

• Marginal note:Consolidation of securities

  (7) At the request of the provincial treasurer or other similar officer of a province, the Minister of Finance may accept in the place of any series of securities of that province purchased by the Minister under this section during any consecutive period of not more than twelve months, on payment of any interest then accrued thereon, another security of that province in an amount equal to the aggregate amount then outstanding of the securities of that series, and bearing interest at a rate determined by the Minister of Finance to be the average of the rates of interest on each of the securities of that series weighted according to the amounts then outstanding of each of those securities.

• (8) [Repealed, 2003, c. 5, s. 5]