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Insurance Companies Act (S.C. 1991, c. 47)

Act current to 2021-02-15 and last amended on 2019-06-17. Previous Versions

PART XVIIInsurance Holding Companies (continued)

DIVISION 9Investments (continued)

Subsidiaries and Equity Investments (continued)

Marginal note:Approval for indirect investments

  •  (1) If an insurance holding company obtains the approval of the Minister under subsection 971(5) to acquire control of, or to acquire or increase a substantial investment in, an entity and, through that acquisition or increase, the insurance holding company indirectly acquires control of, or acquires or increases a substantial investment in, another entity that would require the approval of the Minister under subsection 971(5) or the Superintendent under subsection 971(6) and that indirect acquisition or increase is disclosed to the Minister in writing before the approval is obtained, the insurance holding company is deemed to have obtained the approval of the Minister or the Superintendent for that indirect acquisition or increase.

  • Marginal note:Approval for indirect investments

    (2) If an insurance holding company obtains the approval of the Superintendent under subsection 971(6) to acquire control of, or to acquire or increase a substantial investment in, an entity and, through that acquisition or increase the insurance holding company indirectly acquires control of, or acquires or increases a substantial investment in, another entity that would require the approval of the Superintendent under that subsection and that indirect acquisition or increase is disclosed to the Superintendent in writing before the approval is obtained, the insurance holding company is deemed to have obtained the approval of the Superintendent for that indirect acquisition or increase.

  • 2001, c. 9, s. 465

Marginal note:Undertakings

  •  (1) If an insurance holding company controls a permitted entity, other than an entity referred to in any of paragraphs 971(1)(a) to (f), the insurance holding company shall provide the Superintendent with any undertakings that the Superintendent may require regarding

    • (a) the activities of the entity; and

    • (b) access to information about the entity.

  • Marginal note:Undertakings

    (2) If an insurance holding company acquires control of an entity referred to in any of paragraphs 971(1)(g) to (j), the insurance holding company shall provide the Superintendent with any undertakings concerning the entity that the Superintendent may require.

  • Marginal note:Agreements with other jurisdictions

    (3) The Superintendent may enter into an agreement with the appropriate official or public body responsible for the supervision of any entity referred to in any of paragraphs 971(1)(g) to (j) in each province or in any other jurisdiction concerning any matters referred to in paragraphs (1)(a) and (b) or any other matter the Superintendent considers appropriate.

  • Marginal note:Access to records

    (4) Despite any other provision of this Division, an insurance holding company shall not control a permitted entity, other than an entity referred to in any of paragraphs 971(1)(a) to (f), unless, in the course of the acquisition of control or within a reasonable time after the control is acquired, the insurance holding company obtains from the permitted entity an undertaking to provide the Superintendent with reasonable access to the records of the permitted entity.

  • 2001, c. 9, s. 465

Exceptions and Exclusions

Marginal note:Temporary investments in entity

  •  (1) Subject to subsection (3), an insurance holding company may, by way of a temporary investment, acquire control of, or acquire or increase a substantial investment in, an entity but, within two years, or any other period that may be specified or approved by the Superintendent, after acquiring control or after acquiring or increasing the substantial investment, as the case may be, it shall do all things necessary to ensure that it no longer controls the entity or has a substantial investment in the entity.

  • Marginal note:Extension

    (2) The Superintendent may, in the case of any particular insurance holding company that makes an application under this subsection, extend the period of two years, or the other period specified or approved by the Superintendent, that is referred to in subsection (1) for any further period or periods, and on any terms and conditions, that the Superintendent considers necessary.

  • Marginal note:Temporary investment

    (3) If an insurance holding company, by way of temporary investment, acquires control of, or acquires or increases a substantial investment in, an entity for which the approval of the Minister would have been required under subsection 971(5) if the insurance holding company had acquired the control, or acquired or increased the substantial investment, under section 971, the insurance holding company must, within 90 days after acquiring control or after acquiring or increasing the substantial investment,

    • (a) apply to the Minister for approval to retain control of the entity or to continue to hold the substantial investment in the entity for a period specified by the Minister or for an indeterminate period on any terms and conditions that the Minister considers appropriate; or

    • (b) do all things necessary to ensure that, on the expiry of the 90 days, it no longer controls the entity or does not have a substantial investment in the entity.

  • Marginal note:Indeterminate extension

    (4) If an insurance holding company, by way of temporary investment, acquires control of, or acquires or increases a substantial investment in, an entity for which the approval of the Superintendent would have been required under subsection 971(6) if the insurance holding company had acquired the control, or acquired or increased the substantial investment, under section 971, the Superintendent may, on application, permit the insurance holding company to retain control of the entity or to continue to hold the substantial investment in the entity for an indeterminate period, on any terms and conditions that the Superintendent considers appropriate.

  • 2001, c. 9, s. 465
  • 2007, c. 6, s. 327

Marginal note:Loan workouts

  •  (1) Despite anything in this Division, if any subsidiary of an insurance holding company has made a loan to an entity and, under the terms of the agreement between the subsidiary and the entity with respect to the loan and any other documents governing the terms of the loan, a default has occurred, the insurance holding company may acquire, through the subsidiary,

    • (a) a substantial investment in the entity to which the loan was made;

    • (b) a substantial investment in any entity that is an affiliate of the entity; or

    • (c) a substantial investment in an entity that is primarily engaged in holding shares of, ownership interests in or assets acquired from the entity to which the loan was made or any of the affiliates of that entity.

  • Marginal note:Obligation of insurance holding company

    (2) If an insurance holding company acquires a substantial investment in an entity under subsection (1), the insurance holding company shall, within five years after acquiring the substantial investment, cause the subsidiary that made the loan to do all things necessary to ensure that the insurance holding company does not control the entity or have a substantial investment in the entity.

  • Marginal note:Extension

    (3) The Superintendent may, in the case of any particular insurance holding company that makes an application under this subsection, extend the period of five years referred to in subsection (2) for any further period or periods, and on any terms and conditions, that the Superintendent considers necessary.

  • Marginal note:Exception — entities controlled by foreign governments

    (4) Despite anything in this Division, if a subsidiary of an insurance holding company has made a loan to, or holds a debt obligation of, the government of a foreign country or an entity controlled by the government of a foreign country and, under the terms of the agreement between the subsidiary and that government or the entity, as the case may be, and any other documents governing the terms of the loan or debt obligation, a default has occurred, the insurance holding company may acquire, through the subsidiary, a substantial investment in that entity or in any other entity designated by that government if the acquisition is part of a debt restructuring program of that government.

  • Marginal note:Time for holding substantial investment

    (5) If an insurance holding company acquires a substantial investment in any entity under subsection (4), the insurance holding company may, on any terms and conditions that the Superintendent considers appropriate, continue to hold the substantial investment for an indeterminate period or for any other period that the Superintendent may specify.

  • Marginal note:Exception

    (6) If, under subsection (1), an insurance holding company acquires control of, or acquires or increases a substantial investment in, an entity that it would otherwise be permitted to acquire or increase under section 971, the insurance holding company may retain control of the entity or continue to hold the substantial investment for an indeterminate period, if the approval in writing of the Minister is obtained before the end of the period referred to in subsection (2), including any extension of it granted under subsection (3).

  • 2001, c. 9, s. 465

Marginal note:Realizations

  •  (1) Despite anything in this Part, an insurance holding company may acquire control of, or a substantial investment in, an entity if the control or the substantial investment is acquired through the realization of a security interest held by a subsidiary of the insurance holding company.

  • Marginal note:Disposition

    (2) Subject to subsection 756(2), if an insurance holding company acquires control of, or a substantial investment in, an entity by way of the realization of a security interest held by any of its subsidiaries, the insurance holding company shall, within five years after the day on which control or the substantial investment is acquired, cause the subsidiary to do all things necessary to ensure that the insurance holding company no longer controls the entity or has a substantial investment in the entity.

  • Marginal note:Extension

    (3) The Superintendent may, in the case of any particular insurance holding company that makes an application under this subsection, extend the period of five years referred to in subsection (2) for any further period or periods, and on any terms and conditions, that the Superintendent considers necessary.

  • Marginal note:Exception

    (4) If, under subsection (1), an insurance holding company acquires control of, or acquires or increases a substantial investment in, an entity that it would otherwise be permitted to acquire or increase under section 971, the insurance holding company may retain control of the entity or continue to hold the substantial investment for an indeterminate period if the approval in writing of the Minister is obtained before the end of the period referred to in subsection (2), including any extension of it granted under subsection (3).

  • 2001, c. 9, s. 465
 
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