This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our cookie notice (http://www2.deloitte.com/ca/en/legal/cookies.html) for more information on the cookies we use and how to delete or block them.
The full functionality of our site is not supported on your browser version, or you may have 'compatibility mode' selected. Please turn off compatibility mode, upgrade your browser to at least Internet Explorer 9, or try using another browser such as Google Chrome or Mozilla Firefox.

Certain Canadian securities regulators to adopt start-up crowdfunding exemptions

  • Securities - CSA Image

May 14, 2015

On May 14, 2015, the securities regulators of British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia (the “participating jurisdictions”) announced they have implemented, or expect to implement, registration and prospectus exemptions that will allow start-ups and early-stage companies to raise capital through crowdfunding in these jurisdictions, subject to certain conditions.

These exemptions are further to the comments received as part of the consultation held in March 2014. Businesses wishing to rely on these exemptions will be able to conduct crowdfunding distributions in all participating jurisdictions.

“Crowdfunding is an attractive way for start-ups to raise capital. This regime addresses micro-capitalization needs and issues, which are more local in nature and sometimes industry-specific. Each member of the Canadian Securities Administrators was therefore able to consider the characteristics of its own market and choose whether to opt in to the exemption regime,” explained Louis Morisset, CSA Chair and President and CEO of the Autorité des marchés financiers. “Some participating jurisdictions continue to work on proposed Multilateral Instrument 45-108 – Crowdfunding.”

The start-up crowdfunding exemption is comprised of two exemptions: a prospectus exemption for start-ups seeking to raise capital and a dealer registration exemption for persons wishing to operate a funding portal. The conditions associated with these exemptions are outlined in Multilateral CSA Notice 45-316 – Start-up Crowdfunding Registration and Prospectus Exemptions. Registered dealers are able to operate funding portals that facilitate start-up crowdfunding distributions, subject to their registration obligations, including suitability.

Access the Multilateral CSA Notice 45-316.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.