Marginal note:Prohibition re deposits
520 (1) Despite anything in this Part, but subject to subsection (5) and section 509, a foreign bank — or an entity that is associated with a foreign bank and that is incorporated or formed otherwise than by or under an Act of Parliament or of the legislature of a province — shall not, as part of its business in Canada,
(a) engage in the business of accepting deposit liabilities;
(b) engage in the business of acting as an agent for the acceptance of deposit liabilities for a foreign bank or an entity associated with a foreign bank, other than for
(i) an authorized foreign bank,
(ii) a foreign cooperative credit society that has received the approval of the Minister under paragraph 522.22(1)(f) to engage in or carry on the business of a cooperative credit society, or
(iii) an entity referred to in any of paragraphs 468(1)(a), (c), (d) and (h) or a trust or loan corporation referred to in paragraph 468(1)(g); or
(c) represent to the public that any instrument issued by it is a deposit or that any liability incurred by it is a deposit.
Marginal note:Disclosure of status
(2) Despite anything in this Part, but subject to subsections (4) to (6) and section 509, a foreign bank or entity referred to in subsection (1) that carries on, as part of its business in Canada, the provision of financial services shall not borrow money in Canada from the public without disclosing that
(a) the foreign bank or entity is not a member institution of the Canada Deposit Insurance Corporation;
(b) the liability incurred through the borrowing is not a deposit; and
(c) the foreign bank or entity is not regulated as a financial institution in Canada.
Marginal note:Manner of disclosure
(3) The disclosure shall be
(a) in a prospectus, information circular or other offering document or a similar document related to the borrowing or, if there is no such document, in a statement delivered to the lender; or
(b) in any other manner that may be prescribed.
Marginal note:Exception for certain borrowing
(4) Subsection (2) does not apply
(a) to a borrowing of a prescribed class or type or to a borrowing in prescribed circumstances or in a prescribed manner; or
(b) except as may be provided in any regulations, to a borrowing
(i) from a person in an amount of $150,000 or more, or
(ii) through the issue of instruments in denominations of $150,000 or more.
Marginal note:Non-application - authorized foreign banks and foreign cooperative credit societies
(5) Subsections (1) and (2) do not apply to
(a) a foreign bank that is an authorized foreign bank; or
(b) a foreign cooperative credit society that has received the approval of the Minister under paragraph 522.22(1)(f) to engage in or carry on the business of a cooperative credit society.
Marginal note:Non-application foreign insurance company or securities dealer
(6) Subsection (2) does not apply to a foreign bank, or an entity associated with a foreign bank, that is
(a) a foreign insurance company; or
(b) a foreign securities dealer that has received the approval of the Minister under paragraph 522.22(1)(f) to engage in or carry on the business of dealing in securities.
- 1991, c. 46, s. 520
- 1999, c. 28, s. 32
- 2001, c. 9, s. 132
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