Canada Cooperatives Regulations

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Canada Cooperatives Regulations

SOR/99-256CANADA COOPERATIVES ACT
Registration 1999-06-17
Canada Cooperatives Regulations
P.C. 1999-1144  1999-06-17His Excellency the Governor General in Council, on the recommendation of the Minister of Industry, pursuant to paragraph 23(a), subsections 130(1) and 131(1), section 166, paragraph 247(1)(a) and sections 248 and 372 of the Canada Cooperatives ActFootnote a, hereby makes the annexed Canada Cooperatives Regulations.
Return to footnote aS.C. 1998, c. 1Interpretation

[SOR/2001-513, s. 1(F)]
1 The following definitions apply in these Regulations.

Act
Act means the Canada Cooperatives Act. (Loi)
NI 51-102
NI 51-102 means National Instrument 51-102 of the Canadian Securities Administrators, entitled Continuous Disclosure Obligations, and known in French as Règlement 51-102 sur les obligations d’information continue, published in both official languages on December 19, 2003, as amended from time to time. (Règlement 51-102)

SOR/2008-315, s. 8.
Previous Version

1.1 (1) For the purpose of the definition distributing cooperative in subsection 2(1) of the Act and subject to subsection (2), distributing cooperative means

(a) a cooperative that is a “reporting issuer” under any legislation that is set out in column 2 of an item of Schedule 4; or

(b) in the case of a cooperative that is not a “reporting issuer” referred to in paragraph (a), a cooperative

(i) that has filed a prospectus or registration statement under provincial legislation or under the laws of a jurisdiction outside Canada,
(ii) any of the securities of which are listed and posted for trading on a stock exchange in or outside Canada, or
(iii) that is involved in, formed for, resulting from or continued after an amalgamation, a reorganization, an arrangement or a statutory procedure, if one of the participating entities is a cooperative to which subparagraph (i) or (ii) applies.

(2) A cooperative that is subject to an exemption under provincial securities legislation, or to an order of the relevant provincial securities regulator that provides that the cooperative is not a “reporting issuer” for the purposes of the applicable legislation, is not a distributing cooperative for the purpose of the definition of that expression in subsection (1).

SOR/2001-513, s. 2;
SOR/2010-128, s. 35.

Previous Version

PART 1 Electronic Transmission of Documents Sent to and Issued by the Director

General

[SOR/2001-513, s. 3]
2 In sections 3 to 7, electronic means electrical, digital, magnetic, optical, electromagnetic, facsimile or any other form of technology with similar capabilities that permits transmission of notices or documents.

3 [Repealed, SOR/2001-513, s. 4]

4 A notice or document may be submitted to or issued by the Director in electronic form if

(a) the information contained in it is the same as or equivalent to the information that would have been provided if it had been submitted or issued in paper form;
(b) when the notice or document is required under the Act to be signed, it complies with the provisions of subsections 6(2) to (4); and
(c) it is submitted or issued in the manner fixed by the Director under subsection 368(2) of the Act.

5 A notice or document that is submitted to or issued by the Director in electronic form shall be accompanied by a cover page in the manner fixed by the Director under subsection 368(2) of the Act.

6 (1) A notice or document, other than a Director’s certificate, that is required under the Act to be signed, that was produced in paper form and that is submitted to the Director in electronic form shall bear a reproduction of the manual signature.

(2) A notice or document, other than a Director’s certificate, that is required under the Act to be signed, that was produced in electronic form and that is submitted to the Director in electronic form shall bear

(a) the typed name of the person who signed it, if, before it is submitted in electronic form, the notice or document is produced in paper form, is manually signed and is maintained in the records of the cooperative in accordance with section 31 of the Act; or
(b) an electronic digital signature or other personal identifier produced in a manner fixed by the Director under subsection 368(2) of the Act.

(3) On request, an electronic filer or the cooperative shall furnish the Director with any notice or document referred to in paragraph (2)(a).

(4) A certificate that is issued by the Director under section 365 of the Act in electronic form shall bear

(a) a reproduction of the Director’s manual signature; or
(b) an electronic signature or other personal identifier produced in the manner fixed by the Director under subsection 368(2) of the Act.

7 (1) A notice or document submitted to the Director in electronic form is deemed to have been received on the date and time it is received by the Director at a location or electronic address fixed by the Director under subsection 368(2) of the Act.
(2) If the local time of the place from which a notice or document is transmitted in electronic form is different from the local time of the place where the notice or document is received by the Director, the date and time of the transmission shall be determined according to the local time of the place where the Director received the transmission.

Electronic Documents

7.1 For the purpose of section 361.2 of the Act, the prescribed notices, documents or other information are the notices, documents or other information referred to in sections 177 to 185 and 189 to 246 of the Act.
SOR/2001-513, s. 5.

7.2 For the purpose of paragraph 361.3(2)(a) of the Act, the consent shall be in writing.
SOR/2001-513, s. 5.

7.3 For the purpose of paragraph 361.3(2)(b) of the Act, a notice, document or other information that is not required under the Act to be sent to a specific place may be sent as an electronic document to a place other than to an information system designated by the addressee under paragraph 361.3(2)(a) of the Act by posting it on or making it available through a generally accessible electronic source, such as a website, and by providing the addressee with notice in writing of the availability and location of that electronic document.

SOR/2001-513, s. 5;
SOR/2010-128, s. 36.

Previous Version

7.4 For the purpose of subsection 361.3(3) of the Act, an addressee shall revoke his or her consent in writing.
SOR/2001-513, s. 5.

7.5 For the purposes of paragraphs 361.4(b) and 361.5(2)(b) of the Act, when a notice, document or other information is provided to several addressees, the notice, document or other information shall be provided to the addressees concurrently, regardless of the manner of provision.
SOR/2001-513, s. 5.

7.6 An electronic document is considered to have been provided when it leaves an information system within the control of the originator or another person who provided the document on the originator’s behalf.

SOR/2001-513, s. 5;
SOR/2010-128, s. 37.

Previous Version

7.7 An electronic document is considered to have been received

(a) if the document is provided to the information system designated by the addressee, when it enters that information system; or
(b) if the document is posted on or made available through a generally accessible electronic source, when the notice of the availability and location of the electronic document referred to in section 7.3 is received by the addressee or, if the notice is sent electronically, when the notice enters the information system designated by the addressee.

SOR/2001-513, s. 5;
SOR/2010-128, s. 37.

Previous Version

7.8 [Repealed, SOR/2010-128, s. 37]
Previous Version

Retention of Records

7.9 For the purpose of subsection 378(3) of the Act, the prescribed period is six years after the date on which the Director receives the document.
SOR/2001-513, s. 5.

PART 2 Cooperative Names

Interpretation

8 (1) The following definitions apply in this Part.

distinctive
distinctive, in relation to a trade-name, considered as a whole and by its separate elements, means a trade-name that distinguishes the business in association with which it is used or intended to be used by its owner from any other business or that is adapted to so distinguish them. (distinctive)
official mark
official mark means an official mark referred to in subparagraph 9(1)(n)(iii) of the Trade-marks Act. (marque officielle)
trade-mark
trade-mark means a trade-mark as defined in section 2 of the Trade-marks Act. (marque de commerce)
trade-name
trade-name means a name that has been reserved by the Director under section 22 of the Act, or the name under which a business is carried on, or intended to be carried on, whether it is a corporate name or the name of a body corporate, trust, partnership, sole proprietorship or individual. (dénomination commerciale)
use
use means the actual use by a person that carries on business in Canada or elsewhere. (emploi)

(2) For greater certainty, this Part applies to the cooperative name of an amalgamated cooperative.

SOR/2001-513, s. 6;
SOR/2010-72, s. 3.

Previous Version

Confusing Names

9 A cooperative name is confusing with

(a) a trade-mark or official mark if it is the same as that trade-mark or official mark or if the use of both the cooperative name and either the trade-mark or the official mark, as the case may be, is likely to lead to the inference that the business carried on or intended to be carried on under the cooperative name and the business connected with the trade-mark or official mark, as the case may be, are one business, whether or not the nature of the business of each is generally the same; or
(b) a trade-name if it is the same as that trade-name or if the use of both names is likely to lead to the inference that the business carried on or intended to be carried on under the cooperative name and the business carried on under the trade-name are one business, whether or not the nature of the business of each is generally the same.

SOR/2010-72, s. 3.
Previous Version

10 For the purpose of paragraph 23(a) of the Act, a cooperative name is prohibited if its use causes confusion with a trade-mark, official mark or trade-name, having regard to the circumstances, including

(a) the inherent distinctiveness of the whole or any element of the trade-mark, official mark or trade-name and the extent to which it has become known;
(b) the length of time that the trade-mark, official mark or trade-name has been in use;
(c) the nature of the goods, services or business with which the trade-mark, official mark or trade-name is associated;
(d) the nature of the trade with which the trade-mark, official mark or trade-name is associated;
(e) the degree of resemblance between the proposed cooperative name and the trade-mark, official mark or trade-name in appearance or sound or in the ideas suggested by them; and
(f) the geographical area in Canada in which the trade name or proposed cooperative name is likely to be used.

SOR/2010-72, s. 3.
Previous Version

11 Despite section 10, a cooperative name that is confusing with the name of a body corporate that has not carried on business in the two years immediately before the day on which the Director receives the articles referred to in paragraph 10(a), subsection 285(4) or (5), section 292 or subsection 299(4), 303(6), 305(1) or 308(3) of the Act or a request to reserve a name under section 22 of the Act is not prohibited for that reason alone if

(a) the body corporate has been dissolved; or
(b) in the case of a body corporate that has not been dissolved, it consents in writing to the use of the name and undertakes in writing to dissolve immediately or to change its name before the cooperative that proposes to use the name begins using it.

SOR/2001-513, s. 7;
SOR/2010-72, s. 3.

Previous Version

12 Despite section 10, if a word in a cooperative name is confusing with the distinctive element of a trade-mark, official mark or trade-name, the cooperative name is not prohibited for that reason alone if the person who owns the trade-mark, official mark or trade-name consents in writing to the use of the cooperative name.
SOR/2010-72, s. 3.
Previous Version

13 (1) Despite section 10, a cooperative name that is confusing with the name of a body corporate is not prohibited for that reason alone if

(a) the cooperative name is the name of an existing or a proposed cooperative that is the successor to the business of the body corporate and the body corporate has ceased or will, in the immediate future, cease to carry on business under that cooperative name and undertakes in writing to dissolve or to change its name before the successor cooperative begins carrying on business under that name; and
(b) the cooperative name of the existing or proposed cooperative sets out in numerals the year of incorporation, or the year of the most recent amendment to the cooperative name, in parentheses.

(2) If a cooperative name is changed so that the reference to the year of incorporation or the year of the most recent amendment to the cooperative name is deleted at least two years after it is introduced, it is not prohibited for that reason alone.

SOR/2010-72, s. 3.
Previous Version

14 Despite section 10, if the cooperative name of an amalgamated cooperative is the same as the name of one of the amalgamating cooperatives, it is not prohibited for that reason alone.
SOR/2010-72, s. 3.
Previous Version

15 (1) Despite section 10, the cooperative name of a cooperative that is the same as the name of an affiliated body corporate from which the existing cooperative has acquired or will, in the immediate future, acquire all or substantially all of the property of the body corporate is not prohibited for that reason alone if the body corporate undertakes in writing to dissolve, or to change its name, before the existing cooperative begins using the cooperative name.
(2) Despite section 10, if the cooperative name of a proposed cooperative is the same as the name of a body corporate that is to be an affiliate of the proposed cooperative from which the proposed cooperative will, in the immediate future, acquire all or substantially all of the property of the body corporate, the cooperative name is not prohibited for that reason alone if the body corporate undertakes in writing to dissolve, or to change its name, before the proposed cooperative begins using the cooperative name.

SOR/2001-513, s. 8;
SOR/2010-72, s. 3.

Previous Version

General Prohibitions

16 For the purpose of paragraph 23(a) of the Act, a cooperative name is prohibited if the name contains any of the following elements:

(a) “Parliament Hill” or “Colline du Parlement”;
(b) “Royal Canadian Mounted Police”, “Gendarmerie royale du Canada”, “RCMP” or “GRC”; and
(c) “United Nations”, “Nations Unies”, “UN” or “ONU”, if it connotes a relationship to the United Nations.

SOR/2010-72, s. 3.
Previous Version

17 For the purpose of paragraph 23(a) of the Act, a cooperative name is prohibited if it connotes that the cooperative

(a) carries on business under royal, vice-regal or governmental patronage, approval or authority, unless Her Majesty or a person, society, authority or organization referred to in paragraph 9(2)(a) of the Trade-marks Act consents in writing to the use of the name;
(b) is sponsored or controlled by or is connected with the Government of Canada, the government of a province, the government of a country other than Canada or a political subdivision or agency of any such government, unless the appropriate government, political subdivision or agency consents in writing to the use of the name;
(c) is sponsored or controlled by or is connected with a university or an association of accountants, architects, engineers, lawyers, physicians or surgeons or another professional association recognized by the laws of Canada or a province, unless the appropriate university or professional association consents in writing to the use of the name;
(d) carries on the business of a bank, a loan company, an insurance company, a trust company or another financial intermediary that is regulated by the laws of Canada, unless the Superintendent of Financial Institutions consents in writing to the use of the name; or
(e) carries on the business of a stock exchange that is regulated by the laws of a province, unless the relevant provincial securities regulator consents in writing to the use of the name.

SOR/2010-72, s. 3.
Previous Version

18 For the purpose of paragraph 23(a) of the Act, a cooperative name is prohibited if it contains a word or phrase, or connotes a business, that is obscene.
SOR/2010-72, s. 3.
Previous Version

19 (1) For the purpose of paragraph 23(a) of the Act, a cooperative name is prohibited if an element of the name is the family name of an individual, whether or not preceded by their given name or initials, unless the individual or their heir or personal representative consents in writing to the use of their name and, subject to subsection (2), the individual has or had a material interest in the cooperative.
(2) The individual is not required to have or to have had a material interest in the cooperative if Part 20 of the Act applies to the cooperative or the individual is a recognized cooperative leader.

SOR/2001-513, s. 9;
SOR/2010-72, s. 3.

Previous Version

20 For greater certainty, a cooperative name is not prohibited only because it contains alphabetic or numeric characters, initials, punctuation marks or any combination of those elements.

SOR/2001-513, s. 10;
SOR/2010-72, s. 3.

Previous Version

Non-distinctive Names

21 (1) For the purpose of paragraph 23(a) of the Act, a cooperative name is prohibited if it

(a) is only descriptive, in any language, of the business of the cooperative, of the goods and services in which the cooperative deals or intends to deal, or of the quality, function or other characteristic of those goods and services;
(b) is primarily or only the name or family name, used alone, of an individual who is living or has died within 30 years before the day on which the Director receives the articles referred to in paragraph 10(a), subsection 285(4) or (5), section 292, subsection 299(4), 303(6), 305(1) or 308(3) of the Act or a request to reserve a name under section 22 of the Act; or
(c) is primarily or only a geographic name that is used alone.

(2) Subsection (1) does not apply if a person proposing to use the cooperative name establishes that it has been used in Canada or elsewhere by them or by their predecessors so as to have become distinctive in Canada on the day referred to in paragraph (1)(b).

SOR/2001-513, s. 11;
SOR/2010-72, s. 3.

Previous Version

Deceptively Misdescriptive Names

22 For the purpose of paragraph 23(a) of the Act, a cooperative name is deceptively misdescriptive if it is likely to mislead the public, in any language, with respect to any of the following:

(a) the business, goods or services in association with which it is proposed to be used;
(b) the conditions under which the goods or services will be produced or supplied or the persons to be employed in the production or supply of the goods or services; and
(c) the place of origin of the goods or services.

SOR/2001-513, s. 12;
SOR/2010-72, s. 3.

Previous Version

23 For the purpose of subsection 20(4) of the Act, a combined English and French form of the name of a proposed cooperative shall include only one of the words or expressions listed in subsection 20(1) of the Act.
SOR/2010-72, s. 3.
Previous Version

23.1 [Repealed, SOR/2010-72, s. 3]
Previous Version

PART 2.1 Insider Trading

23.2 For the purpose of paragraph 171(2)(a) of the Act, the prescribed percentage of voting rights is 10%.
SOR/2001-513, s. 13.

23.3 (1) For the purpose of paragraph 173(1)(e) of the Act, the prescribed percentage of voting rights is 10%.
(2) For the purpose of subsection 173(2) of the Act, take-over bid means a take-over bid within the meaning of any legislation that is set out in column 2 of an item of Schedule 5.

(3) For the purpose of paragraph 173(4)(c) of the Act, the prescribed circumstances are that the insider

(a) entered into the purchase or sale as an agent or mandatary pursuant to a specific unsolicited order to purchase or sell;
(b) made the purchase or sale pursuant to participation in an automatic dividend reinvestment plan, share purchase plan or other similar automatic plan that the insider entered into before the acquisition of the confidential information;
(c) made the purchase or sale to fulfil a legally binding obligation that the insider entered into before the acquisition of the confidential information; or
(d) purchased or sold the security as agent, mandatary or trustee in the circumstances described in paragraph (b) or (c).

SOR/2001-513, s. 13;
SOR/2010-128, ss. 38(F), 39(E).

Previous Version

PART 2.2 Meetings

Record Date

23.4 (1) For the purpose of subsection 51(1) of the Act, the prescribed period for the directors to fix the record date is not more than 60 days before the day on which the particular action is to be taken.
(2) For the purpose of subsections 51(3) and (4) of the Act, the prescribed period for the directors to fix the record date is not less than 21 days and not more than 60 days before the date of the meeting.
(3) For the purpose of subsection 51(6) of the Act, the prescribed period for the directors to provide notice of the record date is at least seven days before the date fixed.

SOR/2001-513, s. 13;
SOR/2010-128, s. 40.

Previous Version

Notice of Meetings

23.5 For the purpose of subsection 52(1) of the Act, the prescribed period for the directors to provide notice of the time and place of a meeting is not less than 21 days and not more than 60 days before the meeting.
SOR/2001-513, s. 13.

Communication Facilities

23.6 (1) For the purposes of section 65(3) of the Act, when a vote is to be taken at a meeting of the cooperative, the voting may be carried out by means of a telephonic, electronic or other communication facility, if the facility

(a) enables the votes to be gathered in a manner that permits their subsequent verification; and
(b) permits the tallied votes to be presented to the cooperative without it being possible for the cooperative to identify how each member or shareholder or group of members or shareholders voted.

(2) For the purpose of subsection 65(4) of the Act, a person who is entitled to vote at a meeting of the cooperative may vote by means of a telephonic, electronic or other communication facility, if the facility

(a) enables the vote to be gathered in a manner that permits its subsequent verification; and
(b) permits the tallied vote to be presented to the cooperative without it being possible for the cooperative to identify how the person voted.

SOR/2001-513, s. 13;
SOR/2010-128, s. 41.

Previous Version

PART 2.3 Proposals

23.7 (1) For the purpose of subsection 58(2.1) of the Act,

(a) the prescribed number of investment shares is the number of voting investment shares

(i) that is equal to 1% of the total number of the outstanding investment shares of the cooperative, as of the day on which the shareholder submits a proposal, or
(ii) whose fair market value, as determined at the close of business on the day before the member submits the proposal to the cooperative, is at least $2,000; and

(b) the prescribed period is the six-month period immediately before the day on which the person other than a member submits the proposal.

(2) For the purpose of subsection 58(2.4) of the Act,

(a) a cooperative may request that the person who submits a proposal provide the proof referred to in subsection 58(2.1) within 14 days after the cooperative receives the proposal; and
(b) the person who submits the proposal shall provide the proof within 21 days after the day on which the person receives the cooperative’s request or, if the request is mailed to the person, within 21 days after the postmark date stamped on the envelope containing the request.

(3) For the purpose of subsection 58(3) of the Act, a proposal and a statement in support of it shall together consist of not more than 500 words.
(4) For the purpose of paragraph 58(4)(a) of the Act, the prescribed number of days for submitting a proposal to the cooperative is at least 90 days before the anniversary date.
(5) For the purpose of paragraph 58(4)(c) of the Act, the prescribed period before the receipt of a proposal is two years.

(6) For the purpose of paragraph 58(4)(d) of the Act, the prescribed minimum amount of support for the proposal of a member or shareholder is

(a) 3% of the total number of shares or investment shares voted, if the proposal was introduced at an annual meeting of members or a meeting of shareholders;
(b) 6% of the total number of shares or investment shares voted at its last submission to members or shareholders, if the proposal was introduced at two annual meetings of members or at two meetings of shareholders; and
(c) 10% of the total number of shares or investment shares voted at its last submission to members or shareholders, if the proposal was introduced at three or more annual meetings of members or three or more meetings of shareholders.

(7) For the purpose of paragraph 58(4)(d) of the Act, the prescribed period is five years.
(8) For the purpose of subsection 58(4.1) of the Act, the prescribed period during which the cooperative is not required to include a proposal in the notice of a meeting is two years.

SOR/2001-513, s. 13;
SOR/2010-128, s. 42.

Previous Version

23.8 For the purpose of subsection 60(1) of the Act, the prescribed period for giving notice is no later than 21 days after the receipt of the proposal by the cooperative or of proof of ownership under subsection 58(2.4) of the Act, as the case may be.
SOR/2001-513, s. 13.

PART 3 Proxies and Proxy Solicitation

Form of Proxy

24 For the purpose of subsection 165(1) of the Act, a form of proxy shall be in the form provided for in section 9.4 (Content of Form of Proxy) of NI 51-102.

SOR/2001-513, s. 14;
SOR/2008-315, s. 9.

Previous Version

Management Proxy Circular

25 (1) Subject to subsection (3), a management proxy circular shall be in the form provided for in Form 51-102F5 (Information Circular) of NI 51-102, which form, in the circumstances described in Item 8 of Part 2 of that Form, includes the statement referred to in that Item.

(2) A management proxy circular shall also set out the following:

(a) the percentage of votes required for the approval of any matter that is to be submitted to a vote of shareholders at the meeting, other than the election of directors;
(b) a statement of the right of a shareholder to dissent under section 302 of the Act with respect to any matter to be acted on at the meeting and a brief summary of the procedure to be followed to exercise that right; and
(c) a statement, signed by a director or an officer of the cooperative, that the contents and the sending of the circular have been approved by the directors.

(3) A management proxy circular for a non-distributing cooperative is not required to set out the information provided for in Part 1(c) or Item 9, 10 or 16 of Part 2 of Form 51-102F5 (Information Circular) of NI 51-102, or the statement referred to in Item 8 of Part 2 of that Form.

SOR/2001-513, s. 15(E);
SOR/2008-315, s. 9.

Previous Version

26 For the purpose of subsection 166(3) of the Act, the prescribed form of statement that shall accompany the copy of the management proxy circular to be sent to the Director under that subsection is a statement signed by a director or an officer, to the effect that a copy of the circular has been sent to each director, to each shareholder whose proxy has been solicited and to the auditor of the cooperative.
SOR/2008-315, s. 9.
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Dissident’s Proxy Circular

27 (1) A dissident’s proxy circular shall be in the form provided for in Form 51-102F5 (Information Circular) of NI 51-102, which form, in the circumstances described in Item 8 of Part 2 of that Form, includes the statement referred to in that Item.
(2) A dissident’s proxy circular for a non-distributing cooperative is not required to set out the information provided for in Part 1(c) or Item 9, 10 or 16 of Part 2 of Form 51-102F5 (Information Circular) of NI 51-102, or the statement referred to in Item 8 of Part 2 of that Form.

SOR/2008-315, s. 9.
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28 [Repealed, SOR/2008-315, s. 9]
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29 [Repealed, SOR/2008-315, s. 9]
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30 [Repealed, SOR/2008-315, s. 9]
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31 [Repealed, SOR/2008-315, s. 9]
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32 Information that is not known to a dissident and that cannot be ascertained by the dissident on reasonable inquiry may be omitted from a dissident’s proxy circular, but the circumstances that render the information unavailable shall be disclosed in it.

33 (1) A dissident’s proxy circular shall contain a statement signed by the dissident or a person authorized by the dissident that the contents and the sending of the circular have been approved by the dissident.
(2) For the purpose of subsection 166(3) of the Act, the prescribed form of statement that shall accompany the copy of the dissident’s proxy circular to be sent to the Director under that subsection is a statement signed by the dissident or a person authorized by them, to the effect that a copy of the circular has been sent to each director, to each shareholder whose proxy has been solicited, to the auditor of the cooperative and to the cooperative.

SOR/2008-315, s. 10.
Previous Version

34 [Repealed, SOR/2008-315, s. 11]
Previous Version

Financial Statements in Proxy Circular

35 (1) When financial statements accompany or form part of a management proxy circular, the statements shall be prepared in accordance with Part 4.
(2) The financial statements referred to in subsection (1), if not reported on by the auditor of the cooperative, shall be accompanied by a report of the chief financial officer of the cooperative stating that the financial statements have not been audited but have been prepared in accordance with Part 4.

Proxy Circular Exemptions

35.1 (1) For the purpose of subparagraph (b)(v) of the definition solicit or solicitation in subsection 163(1) of the Act, a solicitation does not include a public announcement that is made by

(a) a speech in a public forum; or
(b) a press release, an opinion, a statement or an advertisement provided through a broadcast medium or by a telephonic, electronic or other communication facility, or appearing in a newspaper, a magazine or other publication generally available to the public.

(2) For the purpose of subparagraph (b)(vii) of the definition solicit or solicitation in subsection 163(1) of the Act, the prescribed circumstances are circumstances in which the communication is made to shareholders

(a) by one or more shareholders and concerns the business and affairs of a cooperative — including its management or proposals contained in a management proxy circular — if no form of proxy is sent to those shareholders by the shareholder or shareholders making the communication or by a person acting on their behalf;
(b) by one or more shareholders and concerns the organization of a dissident proxy solicitation, and no form of proxy is sent to those shareholders by the shareholder or shareholders making the communication or by a person acting on their behalf;

(c) as clients, by a person who gives financial, corporate governance or proxy voting advice in the ordinary course of business and concerns proxy voting advice if

(i) the person discloses to the shareholder any significant relationship with the cooperative and any of its affiliates and any material interests the person has in relation to a matter on which advice is given,
(ii) the person receives any special commission or remuneration for giving the proxy voting advice only from the shareholder or shareholders receiving the advice, and
(iii) the proxy voting advice is not given on behalf of any person soliciting proxies or on behalf of a nominee for election as a director; or

(d) by a person who does not seek directly or indirectly, the power to act as proxy for a shareholder.

(3) The circumstances described in paragraph (2)(a) are not prescribed circumstances if the communication is made by

(a) a shareholder who is an officer or director of the cooperative, or who serves in a similar capacity, if the communication is financed directly or indirectly by the cooperative;
(b) a shareholder who is a nominee or who proposes a nominee for election as a director, if the communication relates to the election of directors;
(c) a shareholder whose communication is in opposition to an amalgamation, arrangement, consolidation or other transaction recommended or approved by the board of directors of the cooperative and who is proposing or intends to propose an alternative transaction to which the shareholder or an affiliate or associate of the shareholder is a party;
(d) a shareholder who, because of a material interest in the subject-matter to be voted on at a shareholders meeting, is likely to receive a benefit from its approval or non-approval, which benefit would not be shared pro rata by all other holders of the same class of shares, unless the benefit arises from the shareholder’s employment with the cooperative; or
(e) any person acting on behalf of a shareholder described in any of paragraphs (a) to (d).

SOR/2001-513, s. 16;
SOR/2008-315, s. 12(F).

Previous Version

35.2 (1) For the purpose of subsection 166(4.1) of the Act, the prescribed circumstances are those in which the solicitation conveyed by public broadcast, speech or publication sets out the information provided for in Items 3.2, 3.4, 5(b) and 11 of Part 2 of Form 51-102F5 (Information Circular) of NI 51-102.
(2) A person making a solicitation referred to in subsection (1) shall send the required information and a copy of any related written communication to the Director and to the cooperative before soliciting proxies.

SOR/2001-513, s. 16;
SOR/2008-315, s. 13.

Previous Version

PART 4 Financial Disclosure

General

36 The financial statements referred to in paragraph 247(1)(a) of the Act of a cooperative whose securities are - or are deemed to be - part of a distribution to the public in accordance with subsection 4(5) of the Act shall be prepared in accordance with the generally accepted accounting principles that are set out in the Handbook of the Canadian Institute of Chartered Accountants.

37 The auditor’s report referred to in section 261 of the Act shall be prepared in accordance with the generally accepted auditing standards that are set out in the Handbook of the Canadian Institute of Chartered Accountants.

Contents of Financial Statements

38 (1) The financial statements referred to in paragraph 247(1)(a) of the Act shall include at least

(a) a balance sheet;
(b) a statement of retained earnings;
(c) an income statement; and
(d) a statement of changes in financial position.

(2) Financial statements need not be designated by the names set out in paragraphs (1)(a) to (d).

PART 4.1 Fundamental Changes

38.1 Despite subparagraph 298(1)(b)(ii) of the Act, the resolutions approving the amalgamation of a holding cooperative with one or more of its wholly owned subsidiary cooperatives may provide that the cooperative name set out in the articles of amalgamation is not the same as that set out in the articles of the amalgamating holding cooperative.
SOR/2010-72, s. 4.

PART 5 Constrained Share Cooperatives

Interpretation

39 The definitions in this section apply in this Part.

Canadian

Canadian means

(a) a resident of Canada;
(b) a partnership of which a majority of the members are resident in Canada and in which interests representing in value more than 50% of the total value of the partnership property are owned by residents of Canada;

(c) a trust established by a resident of Canada

(i) a majority of the trustees of which are resident in Canada, or
(ii) in which beneficial interests representing in value more than 50% of the total value of the trust property are owned by residents of Canada;

(d) Her Majesty in right of Canada or of a province or a municipal corporation or public board or commission in Canada; or

(e) a body corporate

(i) incorporated under the laws of Canada or a province,
(ii) of which a majority of the directors are residents in Canada, and
(iii) over which persons described in any of paragraphs (a) to (d) or in this paragraph exercise control or direction or of which the persons beneficially own investment shares or securities currently convertible into investment shares carrying more than 50% of the voting rights under all circumstances or by reason of the occurrence of an event that has occurred and that is continuing, including currently exercisable options or rights to acquire the investment shares or convertible securities. (canadien)

constrained class
constrained class means the class of persons specified in the articles of a constrained share cooperative as being ineligible to hold, as a class, more than the maximum aggregate holdings. (catégorie restreinte)
constrained share cooperative
constrained share cooperative means a cooperative that has provisions in its articles imposing a constraint. (coopérative à participation restreinte)
constraint

constraint means a restriction on

(a) the issue or transfer of investment shares of any class or series to persons who are not residents of Canada;

(b) the issue or transfer of investment shares of any class or series to enable a cooperative or any of its affiliates or associates to qualify under the laws of Canada or a province referred to in paragraph 53(1)(a)

(i) to obtain a licence to carry on any business,
(ii) to become a publisher of a Canadian newspaper or periodical, or
(iii) to acquire investment shares of a financial intermediary as defined in paragraph 53(1)(b); or

(c) the issue, transfer or ownership of investment shares of any class or series in order to assist a cooperative or any of its affiliates or associates to qualify under the laws of Canada referred to in subsection 53(2) to receive licences, permits, grants, payments or other benefits by reason of attaining or maintaining a specified level of Canadian ownership or control. (restriction)

control
control means control in any manner that results in control in fact, whether directly through the ownership of investment shares or indirectly through a trust, a contract, the ownership of investment shares of any other body corporate or otherwise. (contrôle)
maximum aggregate holdings
maximum aggregate holdings means the total number of voting investment shares of a constrained share cooperative that may be held by or on behalf of persons in the constrained class and their associates in accordance with the articles of the cooperative. (avoir maximum total)
maximum individual holdings
maximum individual holdings means the total number of voting investment shares of a constrained share cooperative that may be held by or on behalf of any one person in the constrained class and the person’s associates in accordance with the articles of the cooperative. (avoir maximum individuel)
resident of Canada

resident of Canada means an individual who

(a) is a citizen of Canada, as determined in accordance with the Citizenship Act, and who is ordinarily resident in Canada;

(b) a citizen of Canada, as determined in accordance with the Citizenship Act, who is not ordinarily resident in Canada and who

(i) is a full-time employee of the Government of Canada or a province, of an agency of any such government or of a federal or provincial crown corporation,

(ii) is a full-time employee of a body corporate

(A) of which more than 50% of the voting investment shares are beneficially owned or over which control or direction is exercised by a resident of Canada,
(B) a majority of the directors of which are residents of Canada, or
(C) that is a subsidiary or a wholly owned subsidiary of a body corporate described in clause (A) or (B), if the principal reason for the residence of the employee outside Canada is to act as such an employee,

(iii) is a full-time student at a university or other educational institution recognized by the educational authorities of a majority of the provinces and who has been resident outside Canada less than 10 consecutive years,
(iv) is a full-time employee of an international association or organization of which Canada is a member, or
(v) was, on the date of their 60th birthday, ordinarily resident in Canada and has been resident outside Canada less than 10 consecutive years; or

(c) is a permanent resident within the meaning of the Immigration and Refugee Protection Act and ordinarily resident in Canada, except a permanent resident who has been ordinarily resident in Canada for more than one year after the time when he or she first became eligible to apply for Canadian citizenship. (résident canadien)

voting investment share
voting investment share means an investment share that is subject to a constraint referred to in paragraph (a) or (b) of the definition constraint and that carries voting rights under all circumstances or by reason of the occurrence of an event that has occurred and that is continuing, and includes a security currently convertible into such an investment share and a currently exercisable option or right to acquire the investment share or the convertible security. (part de placement conférant un droit de vote)

2001, c. 27, s. 273.

Disclosure Required

40 Each of the following documents issued or published by a constrained share cooperative shall indicate conspicuously the general nature of its constrained investment share provisions:

(a) a certificate evidencing a voting investment share;
(b) a management proxy circular; and
(c) a prospectus, statement of material facts, registration statement or similar document.

Powers and Duties of Directors

[SOR/2010-128, s. 43(F)]

41 (1) The directors of a constrained share cooperative that has provisions in its articles imposing a constraint referred to in paragraph (a) or (b) of the definition constraint in section 39 shall refuse to register a transfer of a voting investment share of the cooperative in accordance with the articles if

(a) the total number of voting investment shares held by or on behalf of persons in the constrained class exceeds the maximum aggregate holdings and the transfer is to a person in the constrained class;
(b) the total number of voting investment shares held by or on behalf of persons in the constrained class does not exceed the maximum aggregate holdings and the transfer would cause the number of the investment shares held by persons in the constrained class to exceed the maximum aggregate holdings;
(c) the total number of voting investment shares held by or on behalf of a person in the constrained class exceeds the maximum individual holdings and the transfer is to that person; or
(d) the total number of voting investment shares held by or on behalf of a person in the constrained class does not exceed the maximum individual holdings and the transfer would cause the number of the investment shares held by that person to exceed the maximum individual holdings.

(2) Despite subsection (1), the directors of a constrained share cooperative that is described in that subsection shall register a transfer of a voting investment share of the cooperative to a person in the constrained class if the person establishes that the person was the beneficial owner of that investment share on the day on which the cooperative became a constrained share cooperative.
(3) The directors of a constrained share cooperative that is referred to in subsection (1) shall refuse to issue a voting investment share of the cooperative to a person in the constrained class in circumstances in which the directors are required to refuse to register a transfer of the investment share by that subsection.
(4) For the purpose of subsection (3), the directors may count as issued investment shares the voting investment shares that it is currently offering to its shareholders or prospective shareholders.

42 The directors of a constrained share cooperative that has provisions in its articles imposing a constraint referred to in paragraph (c) of the definition constraint in section 39 shall refuse

(a) to issue an investment share of the cooperative to a person

(i) whose ownership of the share would be contrary to the constraint,
(ii) who, in respect of the issue of the share, has been requested by the cooperative to furnish it with information referred to in subsection 46(7) and has not furnished the information, or
(iii) whose ownership of the share the directors have determined, on the basis of information furnished to the cooperative by that person under a request referred to in subparagraph (ii), may be contrary to the constraint; and

(b) to register a transfer of a share of the cooperative if the transfer is to a person

(i) whose ownership of the share is contrary to the constraint,
(ii) who, in respect of the registration of the share, has been requested by the cooperative to furnish it with information referred to in subsection 46(7) and has not furnished the information, or
(iii) whose ownership of the share the directors have determined, on the basis of information furnished to the cooperative by that person under a request referred to in subparagraph (ii), may be contrary to the constraint.

Limitation on Voting Rights

43 Sections 44 and 45 apply to a constrained share cooperative that has provisions in its articles imposing a constraint referred to in paragraph (a) or (b) of the definition constraint in section 39.

44 (1) If, on the day on which a cooperative becomes a constrained share cooperative, the total number of voting investment shares of the cooperative held by or on behalf of a person in the constrained class exceeds the maximum individual holdings, the person or the person’s nominee may, in person or by proxy, only exercise the voting rights attached to the maximum individual holdings held on that day or on any subsequent day.
(2) After the total number of investment shares held by or on behalf of the person referred to in subsection (1) is reduced below the maximum individual holdings, the person or the person’s nominee may, in person or by proxy, exercise the voting rights attached to investment shares held.

45 (1) Except as provided in subsection 44(1), if the total number of voting investment shares of a constrained share cooperative held by or on behalf of a person in the constrained class exceeds the maximum individual holdings, no person may, in person or by proxy, exercise the voting rights attached to those investment shares.
(2) If it appears from the investment share register of a constrained share cooperative that the total number of voting investment shares held by a shareholder is less than the maximum individual holdings, a proxyholder for the shareholder may vote those investment shares unless the proxyholder has knowledge that the investment shares beneficially owned by the shareholder exceed the maximum individual holdings.
(3) If, after the day on which a cooperative becomes a constrained share cooperative, a cooperative or trust that was not a person in the constrained class becomes a person in the constrained class, the cooperative or trust shall not exercise the voting rights attached to any investment shares it holds in the constrained share cooperative while it is a person in the constrained class.

Sale of Constrained Investment Shares

46 (1) For the purpose of subsection 131(1) of the Act, before a constrained share cooperative concludes that investment shares of the cooperative are owned contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39 or the directors of the cooperative determine that investment shares of the cooperative may be owned contrary to the constraint, the cooperative shall send by registered mail a written notice in accordance with subsection (5) to the person shown in the securities register of the cooperative as the holder of the investment shares.

(2) For the purpose of subsection 131(1) of the Act, investment shares of a constrained share cooperative that are owned contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39 may only be sold after the directors of the cooperative have

(a) ascertained whether or not the cooperative has received a reply to a request for information referred to in subsection (7) respecting the shares and considered the reply, if any; and
(b) examined and considered any other records of the cooperative that contain information that would indicate whether the shares are owned contrary to the constraint.

(3) For the purpose of subsection 131(1) of the Act, if a constrained share cooperative has sent a notice referred to in subsection (1) to a person shown in the securities register of the cooperative as the holder of investment shares, the cooperative shall, not less than 90 days but not more than 150 days after sending the notice, send to the person by registered mail a further written notice in accordance with subsection (6) respecting the investment shares that the cooperative intends to sell if

(a) the cooperative has concluded that investment shares in respect of which the notice was sent are owned contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39; or
(b) the directors of the cooperative have determined that investment shares in respect of which the notice was sent may be owned contrary to the constraint and the cooperative intends to sell all or some of the investment shares under subsection 131(1) of the Act.

(4) Where a cooperative sends a notice under subsection (1) or (3), the cooperative shall, at the time the notice is sent, enter or cause to be entered in the securities register of the cooperative the particulars of the notice including the date on which it was sent.

(5) The notice referred to in subsection (1) shall contain

(a) the name and address of the holder of the investment shares as shown in the securities register of the cooperative;
(b) a statement that identifies the certificate representing the investment shares by certificate number or otherwise;
(c) a statement indicating that all or some of the investment shares may be sold by the cooperative under subsection 131(1) of the Act if the shares are owned, or the directors of the cooperative determine that the shares may be owned, contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39;
(d) a statement indicating that the cooperative may conclude that all or some of the investment shares are owned contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39;

(e) a statement indicating that the directors of the cooperative may determine that all or some of the investment shares may be owned contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39 and that, for the purpose of making the determination, the directors of the cooperative will

(i) consider the reply, if any, to a request for information referred to in subsection (7) respecting the shares, and
(ii) examine and consider any other records of the cooperative that contain information that would indicate whether the shares are owned contrary to the constraint;

(f) a statement indicating that no investment share in respect of which the notice is sent may be sold under subsection 131(1) of the Act if a transfer of the share is registered in the securities register of the cooperative after the notice was sent, unless the cooperative again complies with the requirements set out in this Part respecting the sale of the share;
(g) a statement indicating that no investment share in respect of which the notice is sent may be sold under subsection 131(1) of the Act unless not less than 60 days but not more than 150 days have elapsed from the day on which a notice referred to in subsection (3) is sent to the holder of the share;
(h) a statement indicating the earliest date and the latest date on which the cooperative may sell the investment shares, having regard to the requirements set out in section 48;
(i) a statement indicating that the investment shares may only be sold on an exchange on which investment shares of the cooperative are listed and posted for trading or, if investment shares of the cooperative are not listed and posted for trading on an exchange, in such a way as to obtain the best sale price available in the circumstances at the time of sale;
(j) a statement indicating that, if not all the investment shares of the holder evidenced by a certificate are sold under subsection 131(1) of the Act, a certificate evidencing the investment shares that are not sold will be issued on surrender for cancellation of the certificate evidencing the investment shares sold; and

(k) a statement indicating that, immediately on the sale of the investment shares under subsection 131(1) of the Act, the cooperative will

(i) register the transfer or a notice of the sale of the investment shares or cause the transfer or a notice of the sale of the shares to be registered in the securities register of the cooperative, and
(ii) send a notice of the sale to the person shown in the securities register of the cooperative as the holder of the shares at the time of sale.

(6) The notice referred to in subsection (3) shall contain

(a) the name and address of the holder of the investment shares as shown in the securities register of the cooperative;
(b) a statement that identifies the certificate evidencing the investment shares by certificate number or otherwise;
(c) a statement indicating that all or some of the investment shares may be sold by the cooperative under subsection 131(1) of the Act if the shares are owned, or the directors of the cooperative determine that the shares may be owned, contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39;
(d) a statement indicating that the cooperative has concluded that the investment shares are owned, or that the directors of the cooperative have determined that the investment shares may be owned, contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39 and indicating the reason for the conclusion or determination, as the case may be;
(e) a statement indicating that the cooperative intends to sell all or a specified number of the investment shares under subsection 131(1) of the Act;
(f) a statement indicating that if, before the sale, the cooperative changes its conclusion that the investment shares are owned, or the directors of the cooperative change their determination that the investment shares may be owned, contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39 or there is a change in the reason for the conclusion or determination, the cooperative will send a notice in accordance with subsection 47(1) to the person shown in the securities register of the cooperative as the holder of the investment shares;

(g) a statement advising that, unless the person shown in the securities register of the cooperative as the holder of the investment shares receives a notice referred to in paragraph (f), that person and all other interested persons should not assume

(i) that the cooperative has changed its conclusion that the investment shares are owned, or the directors of the cooperative have changed their determination that the investment shares may be owned, contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39,
(ii) that there has been a change in the reason for the conclusion or determination, or
(iii) that the cooperative no longer intends to sell the investment shares under subsection 131(1) of the Act;

(h) a statement indicating that no investment share in respect of which the notice is sent may be sold under subsection 131(1) of the Act if a transfer of the share is registered in the securities register of the cooperative after the notice referred to in subsection (1) was sent unless the cooperative again complies with the requirements set out in this Part respecting the sale of the share;
(i) a statement indicating that no investment share in respect of which the notice is sent may be sold under subsection 131(1) of the Act unless not less than 60 days but not more than 150 days have elapsed from the day on which the notice was sent to the holder of the share; and
(j) a statement indicating each of the matters referred to in paragraphs (5)(h) to (k).

(7) The notice referred to in subsection (1) shall be accompanied by a request for information as to whether or not the investment shares are owned contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39.
(8) The notice referred to in subsection (3) shall be accompanied by a request for information referred to in subsection (7), unless the cooperative has received the requested information before the notice is sent.
(9) A request for information referred to in subsection (7) shall be accompanied by instructions for the furnishing of the information.

SOR/2010-128, s. 44.
Previous Version

47 (1) If a constrained share cooperative has sent a further written notice referred to in subsection 46(3) and has not sold, under subsection 131(1) of the Act, any share in respect of which the notice was sent, and if the cooperative changes its conclusion referred to in paragraph 46(3)(a) or its directors change their determination referred to in paragraph 46(3)(b) or if there is a change in the reason for the conclusion or determination, the cooperative shall immediately send by registered mail to the recipient of that notice, a notice of the change to the conclusion, to the determination or to the reason for the conclusion or determination, including the reason for the change.
(2) When a cooperative sends a notice under subsection (1), the cooperative shall, at the time the notice is sent, enter or cause to be entered in the securities register of the cooperative the particulars of the notice, including the date on which it was sent.

SOR/2001-513, s. 17.

48 (1) No investment share shall be sold by a constrained share cooperative under subsection 131(1) of the Act unless

(a) the cooperative has sent the notices referred to in subsections 46(1) and (3) to the person shown in the securities register of the cooperative as the holder of the investment share;
(b) not less than 150 days but not more than 300 days have elapsed from the day on which the notice referred to in subsection 46(1) was sent to the holder of the investment share;
(c) not less than 60 days but not more than 150 days have elapsed from the day on which the notice referred to in subsection 46(3) was sent to the holder of the investment share;
(d) the cooperative has concluded that the investment share is owned, or the directors of the cooperative have determined that the investment share may be owned, contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39 and, at the time of sale, the cooperative has no reasonable grounds on which to change its conclusion or the directors of the cooperative have no reasonable grounds on which to change their determination, as the case may be;

(e) the sale takes place

(i) on a stock exchange on which investment shares of the cooperative are listed and posted for trading, or
(ii) if investment shares of the cooperative are not listed and posted for trading on any stock exchange, in such a way as to obtain the best sale price available in the circumstances at the time of sale; and

(f) the cooperative sells the investment share with a view to obtaining the best sale price available in the circumstances at the time of sale.

(2) No investment share in respect of which a notice is sent in accordance with subsection 46(1) shall be sold by a constrained share cooperative under subsection 131(1) of the Act if a transfer of the share is registered in the securities register of the cooperative after the notice was sent, unless the cooperative again complies with the requirements set out in this Part respecting the sale of the share.

49 (1) Immediately on a sale of investment shares by a constrained share cooperative under subsection 131(1) of the Act, the cooperative shall

(a) register the transfer or a notice of the sale of the shares or cause the transfer or a notice of the sale of the shares to be registered in the securities register of the cooperative; and
(b) send a notice of the sale to the person shown in the securities register of the cooperative as the holder of the shares at the time of the sale.

(2) The notice referred to in paragraph (1)(b) shall

(a) state the number of investment shares sold;
(b) identify the certificate evidencing the investment shares sold, by certificate number or otherwise;
(c) state the date and manner of sale;
(d) state the manner in which the person entitled to receive the net proceeds of the sale under subsection 131(1) of the Act may obtain the proceeds;
(e) state that the cooperative has concluded that the investment shares were owned, or that the directors determined that the investment shares may be owned, contrary to a constraint referred to in paragraph (c) of the definition constraint in section 39 and state the reason why the cooperative so concluded or the directors so determined, as the case may be; and
(f) contain a statement, if not all of the investment shares of the holder evidenced by a certificate were sold, that not all of the shares were sold and that a certificate evidencing the investment shares that were not sold will be issued on surrender for cancellation of the certificate evidencing the investment shares sold.

50 The proceeds of a sale by a constrained share cooperative under subsection 131(1) of the Act must be invested in an interest bearing account in a body corporate any of whose deposits are insured by the Canada Deposit Insurance Corporation or guaranteed by the Quebec Deposit Insurance Board or by any other similar entity created by the laws of another province.

Disclosure of Beneficial Ownership

51 Section 52 applies to a constrained share cooperative that has provisions in its articles imposing a constraint referred to in paragraph (a) or (b) of the definition constraint in section 39.

52 (1) In order to ascertain the beneficial ownership of investment shares of a constrained share cooperative, its directors may

(a) require any person in whose name the investment shares are registered to furnish a statutory declaration under the Canada Evidence Act

(i) declaring whether

(A) the shareholder is the beneficial owner of the investment shares or holds them for a beneficial owner,
(B) the shareholder is an associate of any other shareholder, and
(C) the shareholder or beneficial owner is a Canadian, and

(ii) setting out any further relevant facts; and

(b) require any person seeking to have a transfer of a voting investment share registered in their name or to have a voting investment share issued to them to furnish a statutory declaration as described in paragraph (a).

(2) When a person is required to furnish a declaration under subsection (1), the directors may refuse to register a transfer of a voting investment share in the person’s name or to issue a voting investment share to the person until that person has furnished the declaration.
(3) In administering the constrained investment share provisions set out in the articles of a constrained share cooperative, the directors of the cooperative may rely on a statement made in a declaration referred to in subsection (1) or (2).

(4) If the directors are required to determine the total number of voting investment shares of a constrained share cooperative that are held by or on behalf of residents of Canada, the directors may rely on the latest address shown in the investment share register to conclude

(a) in respect of an address that is in Canada, that an individual is a resident of Canada; and
(b) in the case of an address that is outside Canada, that an individual is not a resident of Canada.

(5) For the purpose of subsection (4), the directors may only rely on the investment share register of the constrained share cooperative as of any date after the day on which the cooperative became a constrained share cooperative, but that date shall not be more than four months before the day on which the determination is made.

SOR/2010-128, s. 45.
Previous Version

References and Definitions for the Purposes of Section 130 of the Act

53 (1) For the purpose of paragraph 130(1)(b) of the Act,

(a) the following laws of Canada or a province are prescribed:

(i) the Canadian Aviation Regulations made under the Aeronautics Act,
(ii) the Canada Transportation Act and any regulations made under it,
(iii) the Canada Oil and Gas Land Regulations and the Canada Oil and Gas Drilling and Production Regulations, C.R.C., c. 1517,
(iv) the Broadcasting Act,
(v) the Northern Mineral Exploration Assistance Regulations,
(vi) section 19 of the Income Tax Act,
(vii) the Securities Act (Ontario), R.S.O. 1990, c. S.5, and any regulations made under it, as amended from time to time,
(viii) the Securities Act (Quebec), R.S.Q., c. V-1.1 and any regulations made under it, as amended from time to time, and
(ix) any other law of Canada that has requirements in relation to Canadian ownership, or any other law of a province, as amended from time to time, that has requirements in relation to Canadian ownership; and

(b) financial intermediary means a bank, a trust company, a loan company, an insurance company, an investment company, an association and a body corporate carrying on business as a securities broker, a dealer or an underwriter.

(2) For the purpose of paragraph 130(1)(c) of the Act, the following laws of Canada are prescribed:

(a) the Canada Petroleum Resources Act and any regulations made under it; and
(b) the Canada Transportation Act and any regulations made under it.

(3) For the purpose of paragraph 130(1)(d) of the Act, the following laws are prescribed:

(a) the Insurance Companies Act and any regulations made under it; and
(b) the Trust and Loan Companies Act and any regulations made under it.

(4) For the purpose of subsection 131(1) and paragraph 183(5)(b) of the Act, the following laws are prescribed:

(a) the Insurance Companies Act and any regulations made under it;
(b) the Trust and Loan Companies Act and any regulations made under it; and
(c) the Income Tax Act and any regulations made under it.

SOR/2001-513, s. 18;
SOR/2010-128, s. 46.

Previous Version

PART 6 Rules of Procedure for Applications for Exemptions

Application

54 This Part applies to every application for an exemption under subsection 4(6) or 167(1), section 248 or subsection 263(2) or 267(2) of the Act.

Time of Filing Applications

55 (1) An application for an exemption under

(a) subsection 4(6) of the Act may be made at any time;
(b) subsection 167(1) of the Act shall be made before the date of the notice referred to in subsection 165(1) of the Act;
(c) section 248 of the Act shall be made at least 60 days before the documents in respect of which the exemption is requested are to be sent to the Director;
(d) subsection 263(2) of the Act may be made at any time; and
(e) subsection 267(2) of the Act shall be made at least 30 days before the cooperative is required to comply with Part 8 of the Act.

(2) Despite subsection (1), the Director shall extend the time for making an application for an exemption if the applicant establishes that no prejudice will result from the extension.

Notice by Director of Decision

56 The Director shall, within 30 days after receipt of an application for an exemption, grant the exemption requested or send to the applicant written notice of the refusal together with reasons for the refusal.

General

57 The Director may request that an applicant for an exemption furnish the Director with further information or that any other person furnish the Director with information in writing that is relevant to the application.

58 The Director shall furnish the applicant for an exemption with a copy of any information received from any other person under section 57 and shall allow the applicant a reasonable opportunity to respond in writing.

59 If an applicant for an exemption or a person from whom the Director has requested information under section 57 does not provide the information within the time specified by the Director, the Director may deal with the application without regard to the information.

60 For the purpose of section 345 of the Act, the Director is deemed to have refused to grant an exemption if the exemption is not granted or the written notice of the refusal is not sent within the time specified in section 56.

PART 6.1 Value of Total Financial Interest

60.1 For the purpose of paragraph 337.5(1)(b) of the Act, the prescribed amount of the value of the plaintiff’s total financial interest is $20,000.

SOR/2001-513, s. 19;
SOR/2010-128, s. 47(E).

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PART 6.2 Cancellation of Articles and Certificates

60.2 (1) For the purpose of subsection 376.2(1) of the Act, the prescribed circumstances are that

(a) there is an obvious error in the articles or in the related certificate;
(b) there is an error in the articles or in the related certificate that was made by the Director;
(c) the cancellation of the articles and related certificate is ordered by a court; or
(d) the Director lacked the authority to issue the articles and related certificate.

(2) For the purpose of subsection 376.2(3) of the Act, the prescribed circumstances are that there is no dispute among the directors, members or shareholders as to the circumstances of the request for cancellation and

(a) the cooperative has not used the articles and related certificate; or
(b) if it has used them, anyone dealing with the cooperative on the basis of the articles and related certificate has consented to the cancellation.

SOR/2001-513, s. 19;
SOR/2010-128, s. 48.

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PART 7 Prescribed Fees

61 (1) The fee in respect of the filing, verification or copying of any document or in respect of any service that is set out in column 1 of an item of Schedule 3 that is carried out by the Director under the Act is the fee set out in column 2 of that item and shall be paid to the Director on the filing, verification or copying of the document or before the Director carries out the service in respect of which the fee is payable.

(2) No fee is payable for the issuance by the Director of

(a) a certificate of amendment referred to in section 292 of the Act, if the only purpose of the amendment is to add an English or a French version to a cooperative’s name, or to change its name as directed by the Director under subsection 24(1) or (3) of the Act; or
(b) a corrected certificate issued under subsection 376.1(6) of the Act when the correction is required solely as the result of an error made by the Director.

SOR/2001-513, s. 20(E);
SOR/2010-128, ss. 49, 63(E).

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PART 8 Prescribed Interest

62 For the purpose of subsection 302(25) of the Act,

(a) the rate of interest for any month is the rate per annum that is the aggregate of 3% per annum and the Bank of Canada rate in effect on the third Wednesday of the month before the month in respect of which the interest is computed; and
(b) the interest shall be calculated on a monthly basis for each month or part of a month, beginning on the day on which the resolution is adopted and ending on the day on which full payment is made.

Coming into Force

63 These Regulations come into force on December 31, 1999.

SCHEDULE 1
[Repealed, SOR/2008-315, s. 14]Previous Version

SCHEDULE 2
[Repealed, SOR/2008-315, s. 14]Previous Version

SCHEDULE 3(Subsection 61(1))

FEES

Column 1
Column 2

Item
Service
Fee ($)

1
Issuance by the Director of

(a) a certificate of incorporation issued under section 12 of the Act
250

(b) a certificate of amendment issued under subsection 126(6) or 303(6) of the Act
200

(c) a certificate of amendment issued under section 292 of the Act
200

(d) a restated certificate of incorporation issued under subsection 294(3) of the Act, unless issued with a certificate of amendment
50

(e) a certificate of amalgamation issued under paragraph 285(6)(b) or subsection 299(4) of the Act
200

(f) a certificate of continuance issued under subsection 285(6) of the Act
200

(g) a document evidencing satisfaction of the Director, as required under subsection 287(1) of the Act
200

(h) a certificate of arrangement issued under subsection 305(1) of the Act
200

(i) a certificate of revival issued under subsection 308(3) of the Act
200

(j) a certificate of intent to dissolve issued under subsection 310(5) of the Act
50

(k) a corrected certificate issued under subsection 376(2) of the Act
200

(l) [Repealed, SOR/2010-128, s. 51]

2
Sending the annual return to the Director under section 374 of the Act
40

3
Examination by the Director of the cooperative’s file in connection with a request for a certificate of compliance under section 375 of the Act
35

4
Application to the Director for an exemption under subsection 4(4), 167(1), 263(2) or 267(2) of the Act
250

5
Application to the Director for an exemption under section 248 of the Act
100

6
Uncertified copies of documents provided by the Director under subsection 377(2) of the Act
$1 per page

7
Certified copies of documents provided by the Director under subsection 377(2) of the Act
$35 per certified copy

SOR/2001-513, ss. 21 to 23;
SOR/2010-128, ss. 50, 51, 63(E).

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SCHEDULE 4(Subsection 1.1(1))

REPORTING ISSUER

Column 1
Column 2

Item
Jurisdiction
Legislation

1
Ontario
the definition reporting issuer in subsection 1(1) of the Securities Act, R.S.O. 1990, c. S.5, as amended from time to time

2
Quebec
the definition reporting issuer in sections 5 and 68 of the Securities Act, R.S.Q., c. V-1.1, as amended from time to time

3
Nova Scotia
the definition reporting issuer in paragraph 2(1)(ao) of the Securities Act, R.S.N.S. 1989, c. 418, as amended from time to time

3.1
New Brunswick
the definition reporting issuer in subsection 1(1) of the Securities Act, S.N.B. 2004, c. S-5.5, as amended from time to time

4
Manitoba
the definition reporting issuer in subsection 1(1) of The Securities Act, C.C.S.M. c. S50, as amended from time to time

5
British Columbia
the definition reporting issuer in subsection 1(1) of the Securities Act, R.S.B.C. 1996, c. 418, as amended from time to time

6
Saskatchewan
the definition reporting issuer in paragraph 2(1)(qq) of The Securities Act, 1988, S.S. 1988-89, c. S-42.2, as amended from time to time

7
Alberta
the definition reporting issuer in paragraph 1(ccc) of the Securities Act, R.S.A. 2000, c. S-4, as amended from time to time

8
Newfoundland and Labrador
the definition reporting issuer in paragraph 2(1)(oo) of the Securities Act, R.S.N.L. 1990, c. S-13, as amended from time to time

SOR/2001-513, s. 24;
SOR/2010-128, ss. 52(F), 53(F), 54, 55(F), 56.

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SCHEDULE 5(Subsection 23.3(2))

TAKE-OVER BIDS

Column 1
Column 2

Item
Jurisdiction
Legislation

1
Ontario
the definition take-over bid in subsection 89(1) of the Securities Act, R.S.O. 1990, c. S.5, as amended from time to time

2
Quebec
the definition take-over bid in section 110 of the Securities Act, R.S.Q., c. V-1.1, as amended from time to time

3
Nova Scotia
the definition take-over bid in paragraph 95(c) of the Securities Act, R.S.N.S. 1989, c. 418, as amended from time to time

3.1
New Brunswick
the definition take-over bid in section 106 of the Securities Act, S.N.B. 2004, c. S-5.5, as amended from time to time

4
Manitoba
the definition take-over bid in section 80 of The Securities Act, C.C.S.M. c. S50, as amended from time to time

5
British Columbia
the definition take-over bid in subsection 92(1) of the Securities Act, R.S.B.C. 1996, c. 418, as amended from time to time

6
Saskatchewan
the definition take-over bid in paragraph 98(c) of The Securities Act, 1988, S.S. 1988-89, c. S-42.2, as amended from time to time

7
Alberta
the definition take-over bid in paragraph 158(c) of the Securities Act, R.S.A. 2000, c. S-4, as amended from time to time

8
Newfoundland and Labrador
the definition take-over bid in paragraph 90(c) of the Securities Act, R.S.N.L. 1990, c. S-13, as amended from time to time

9
Yukon
the definition take-over bid in section 196 of the Business Corporations Act, R.S.Y. 2002, c. 20, as amended from time to time

10
Northwest Territories
the definition take-over bid in section 196 of the Business Corporations Act, S.N.W.T. 1996, c. 19, as amended from time to time

11
Nunavut
the definition take-over bid in section 196 of the Business Corporations Act (Nunavut) S.N.W.T. 1996, c. 19, as amended from time to time

SOR/2001-513, s. 24;
SOR/2010-128, ss. 57(F), 58(F), 59, 60(F), 61, 62(F).

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