Budget Implementation Act, 2016, No. 1 (S.C. 2016, c. 7)
Full Document:
Assented to 2016-06-22
Marginal note:2012, c. 5, s. 199
135 Section 39.152 of the Act is replaced by the following:
Marginal note:Assignments — bridge institution or third party
39.152 (1) Subject to subsection (2), if an agreement with a federal member institution is assigned to or assumed by a bridge institution or a third party,
(a) a person is prohibited from terminating or amending the agreement, or claiming an accelerated payment or forfeiture of the term under the agreement, by reason only of
(i) the insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors,
(ii) the making of an order under subsection 39.13(1) or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order,
(iii) a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under the agreement,
(iv) a monetary default, before the order was made, under the agreement by the federal member institution or any of its affiliates that is remedied within 60 days after the day on which the agreement is assigned or assumed,
(v) the assignment or assumption of the agreement to or by a bridge institution or a third party,
(vi) the transfer to a third party of all or part of the assets or liabilities of the federal member institution or any of its affiliates,
(vii) a conversion under subsection 39.2(2.3) in respect of the federal member institution, or
(viii) a conversion of any of the federal member institution’s shares or liabilities in accordance with the contractual terms of those shares or liabilities; and
(b) any stipulation in the agreement that has the effect of providing for or permitting anything that, in substance, is contrary to any of subparagraphs (a)(i) to (viii) or provides, in substance, that the bridge institution or the third party does not have the rights to use or deal with assets that the bridge institution or the third party would otherwise have by reason of the occurrence of any circumstance described in those subparagraphs, is of no force or effect.
Marginal note:Exception
(2) Subparagraphs (1)(a)(iii) and (iv) do not apply to an eligible financial contract, as defined in subsection 39.15(9).
Marginal note:Membership in organization
(3) If a bridge institution or a third party becomes a member of an organization in place of a federal member institution, it is prohibited for the organization to terminate the membership of the bridge institution or of the third party by reason only of
(a) the insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors;
(b) the making of an order under subsection 39.13(1) or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order;
(c) a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under the rules of the organization;
(d) a monetary default, before the order was made, under the rules of the organization by the federal member institution or any of its affiliates that is remedied within 60 days after the day on which the order is made;
(e) the transfer of the federal member institution’s membership to a bridge institution or a third party;
(f) the transfer to a third party of all or part of the assets or liabilities of the federal member institution or any of its affiliates;
(g) a conversion under subsection 39.2(2.3) in respect of the federal member institution; or
(h) a conversion of any of the federal member institution’s shares or liabilities in accordance with the contractual terms of those shares or liabilities.
Marginal note:1996, c. 6, s. 41; 2012, c. 31, s. 167
136 (1) Subsection 39.18(1) of the French version of the Act is replaced by the following:
Marginal note:2012, c. 31, s. 167
(2) Subsection 39.18(2) of the Act is replaced by the following:
Marginal note:Exceptions
(2) Despite paragraph (1)(a),
(a) paragraph 39.15(1)(e) or (f) or subsection 39.15(2) or (2.1) continues to apply to the extent that it produced its effects by reason of
(i) the insolvency or deteriorated financial condition of the federal member institution or any of its affiliates, providers of credit support or guarantors,
(ii) the making of the order under subsection 39.13(1) or any change of control or ownership of the federal member institution or any of its affiliates that is related to the making of the order,
(iii) a non-monetary default, before the order was made, by the federal member institution or any of its affiliates in the performance of obligations under an agreement or the rules of an organization,
(iv) a monetary default, before the order was made, under an agreement or the rules of an organization by the federal member institution or any of its affiliates that was remedied within 60 days after the day on which the order was made,
(v) a conversion under subsection 39.2(2.3) in respect of the federal member institution, or
(vi) a conversion of any of the federal member institution’s shares or liabilities in accordance with contractual terms of those shares or liabilities; and
(b) subject to subsections 39.15(7.101) and (7.102), subsections 39.15(7.01), (7.1) and (7.11) to (7.2) continue to apply and — only for the purpose of interpreting those subsections 39.15(7.01), (7.1) and (7.11) to (7.2) — subsections 39.15(7) and (9) continue to apply.
Marginal note:Stay terminated by order
(3) The Governor in Council may, by order, declare that paragraph (2)(a) ceases to apply in respect of the federal member institution if the Governor in Council considers that all or substantially all of the institution’s assets have been transferred to a bridge institution or a third party.
137 The Act is amended by adding the following after section 39.18:
Non-application of Certain Legislative Provisions
Marginal note:Not agent or Crown corporation
39.181 (1) A federal member institution that is a subsidiary of the Corporation as a result of an order made under paragraph 39.13(1)(a) or (b), a bridge institution or a subsidiary of either of those institutions is not an agent of the Corporation or Her Majesty in right of Canada and, despite Part X of the Financial Administration Act, is not a parent Crown corporation, or a wholly-owned subsidiary, within the meaning of section 83 of that Act. Their respective directors, officers and employees are not part of the federal public administration.
Marginal note:Exception
(2) Despite subsection (1), Division V of Part X of the Financial Administration Act and the regulations made under that Division apply to the federal member institution, the bridge institution or a subsidiary of either of those institutions as if it were a Crown corporation within the meaning of section 83 of that Act.
138 The Act is amended by adding the following after section 39.191:
Marginal note:Regulation to exempt or adapt
39.192 (1) The Governor in Council may, by regulation,
(a) exempt federal member institutions in respect of which an order is made under subsection 39.13(1), bridge institutions or affiliates of either of those institutions, or any class of those institutions or class of their affiliates, or any other person from the application of any provision of this Act or the regulations or of the following Acts or the regulations made under them:
(b) provide that any provision of this Act or the regulations or of the Acts referred to in paragraph (a) or the regulations made under them applies to federal member institutions in respect of which an order is made under subsection 39.13(1), bridge institutions or affiliates of either of those institutions, or any class of those institutions or class of their affiliates, or any other person but only in the manner and to the extent provided for in the regulation made under this subsection, and adapt that provision for the purpose of that application.
Marginal note:Order directed at a given federal member institution
(2) The Governor in Council or the Minister may, by order, do anything that may be done by regulation under subsection (1) in respect of a federal member institution in respect of which an order is made under subsection 39.13(1), a bridge institution, an affiliate of either of those institutions or any other person.
Marginal note:Scope or conditions
(3) An exemption made under paragraph (1)(a) or subsection (2) may be limited in scope or duration or subject to conditions.
Marginal note:Coming into force
(4) An order made by the Minister does not take effect before the later of the date specified in a notice described in subsection 39.2(3) in respect of the federal member institution and the day on which an order made by the Governor in Council under subsection (2) expires.
Marginal note:Expiry
(5) An order made by the Minister expires one year after the day on which the order comes into force or any shorter period specified in the order.
Marginal note:Extension
(6) The Minister may, by order, grant one or more extensions of the applicable period set out in subsection (5) — of up to one year each — but the last extension must expire not later than five years after the date specified in the notice described in subsection 39.2(3).
Marginal note:Statutory Instruments Act
(7) The Statutory Instruments Act does not apply to an order made under subsection (2).
Marginal note:Publication
(8) The Minister shall cause an order made under subsection (2) to be published in the Canada Gazette as soon as he or she considers it appropriate to do so.
Marginal note:Office of Superintendent of Financial Institutions
39.193 (1) Despite subsection 4(2) of the Office of the Superintendent of Financial Institutions Act, if an order is made under subsection 39.13(1) in respect of a federal member institution, the objects of the Office of the Superintendent of Financial Institutions, in respect of the institution or, in the case of an order made under paragraph 39.13(1)(c), a bridge institution, are
Marginal note:Application
(2) Subsection (1) applies during the period that begins on the day on which the order is made and ends
- Date modified: