Canadian Payments Association Election of Directors Regulations (SOR/2015-131)

Interpretation

Marginal note:Definitions

1 The following definitions apply in these Regulations.

Act

Act means the Canadian Payments Act. (Loi)

affiliate

affiliate has the meaning assigned by subsection 9(3) of the Act. (appartenir à un groupe)

nominating committee

nominating committee means the nominating committee referred to in section 20 of the Act. (comité de nomination)

senior officer

senior officer has the meaning assigned by the definition officer in section 2 of the Bank Act. (cadre dirigeant)

Eligibility

Marginal note:Qualified candidates

• 2 (1) The nominating committee must, in preparing a list of qualified candidates for the election as directors, ensure that

  • (a) candidates for directors referred to in paragraphs 8(1)(b) to (d) of the Act represent a sufficient range of skills, expertise and experience for the Board to carry out its responsibilities effectively;

  • (b) candidates for directors referred to in paragraphs 8(1)(b) and (c) of the Act are at a level at least equivalent to the level of senior vice president or executive vice president within their organization; and

  • (c) two of the three directors referred to in paragraph 8(1)(b) of the Act are representatives of financial institutions listed in the schedule.

• Marginal note:Particular case — independent director

  (2) In regard to the directors referred to in paragraph 8(1)(d) of the Act, if the nominating committee is unable to prepare a list of qualified candidates in accordance with paragraph (1)(a) because of the time requirement referred to in paragraph 3(1)(a), (f), (g), (h) or (i), that time requirement is reduced to “within the last year”.

Marginal note:Independent director

• 3 (1) For the purposes of paragraph 8(1)(d) of the Act, independent means a person other than

  • (a) a person who has been, within the last three years, a director, senior officer or employee of the Association, of a member or of an affiliate of a member;

  • (b) a person who is involved in the day-to-day management or direction of the Association, of a member or of an affiliate of a member;

  • (c) a director, senior officer or employee of a person referred to in subsection 4(2) of the Act, of a subsidiary of that person or of a corporation of which that person is its subsidiary;

  • (d) a person who is a spouse or common-law-partner of a senior officer of the Association, of a senior officer of a member, of a senior officer of an affiliate of a member or anyone who resides with any such senior officer;

  • (e) a person who is a family member in a financially dependent relationship, in a financially interdependent relationship or in a personal relationship with a senior officer of the Association, a senior officer of a member or a senior officer of an affiliate of a member, if that relationship could reasonably be expected to interfere with the exercise of a director’s independent judgment;

  • (f) a person who has had within the last three years a contractual or business relationship with the Association, with a member or with an affiliate of a member, if that relationship could reasonably be expected to interfere with the exercise of a director’s independent judgment;

  • (g) a partner, shareholder, director, senior officer or employee of an entity that has had a contractual or business relationship within the last three years with the Association, with a member or with an affiliate of a member, if that relationship could reasonably be expected to interfere with the exercise of a director’s independent judgment;

  • (h) a person who has been within the last three years an advisor or consultant to the Association, to a member or to an affiliate of a member, or a senior officer or director of that advisor or consultant, if that relationship could reasonably be expected to interfere with the exercise of a director’s independent judgment; and

  • (i) a person who has received, in a calendar year any part of which falls within the last three years, from the Association, from a member or from an affiliate of a member any compensation that is greater than $75,000, other than shares or share options or any compensation under a retirement plan, if the receipt of that compensation could reasonably be expected to interfere with the exercise of a director’s independent judgment.

• Marginal note:Guidance

  (2) The nominating committee must provide guidance with respect to the documents or information that it considers relevant to verify the independence of a candidate or director in regard to any circumstance referred to in paragraphs (1)(e) to (i).

Election of Directors

Marginal note:Majority voting

4 A candidate that receives the greatest number of votes in an election of directors for which they have been nominated is elected as a director. If only one candidate is nominated as a director, they are elected as a director when they receive a greater number of votes than the number of votes withheld.

Reporting of Director Independence

Marginal note:Confirmation

• 5 (1) The nominating committee must confirm to the Board before the preparation of the report referred to in section 24 of the Act that each director referred to in paragraph 8(1)(d) of the Act is independent.

• Marginal note:Annual report

  (2) The Board must indicate in the report

  • (a) that the nominating committee has confirmed the independence of the directors; and

  • (b) the instances when the three-year period referred to in paragraph 3(1)(a), (f), (g), (h) or (i) has been reduced.

• Marginal note:Change in circumstance

  (3) A director referred to in paragraph 8(1)(d) of the Act must advise the Chairperson without delay of any change in their circumstance that is likely to affect their ability to meet the requirement to be independent.

Repeal

6 [Repeal]

Coming into Force

Marginal note:S.C. 2014, c. 39

Footnote ^*7 These Regulations come into force on the day on which subsection 356(1) of the Economic Action Plan 2014 Act, No. 2 comes into force but if they are registered after that day, they come into force on the day on which they are registered.

• Return to footnote ^*[Note: Regulations in force June 5, 2015.]