The Saskatchewan Securities Amendment Act, 2004 was proclaimed in force on June 30, with numerous changes taking effect immediately.
The changes include three provision to increase investor protection:
- a new requirement on registrants to deal honestly, fairly and in good faith with their clients;
- a new provision that prohibits anyone from engaging in an unfair practice with the intention of advising or effecting the purchase or sale of a security; and
- an amendment that adds a prohibition of any act relating to securities that perpetrates a fraud on any person. However, someone who has breached the Act will no longer automatically lose their right to use the registration and prospectus exemptions.
As part of the amendments, the Saskatchewan Financial Services Commission may assign some of its powers to the “Director” of the commission, including the power to issue an investigation order. The Director also gets the power to issue a cease trading order against an issuer that has failed to file material required under a decision of or undertaking to the commission. The powers and duties of the Director can also be assigned to employees.
The act also amends several definitions in the legislation. The definition of proxy is amended so that proxies can be prepared and sent in electronic form. The definition of “offering memorandum” is amended so that if an offering brought to market under capital raising exemptions contains a misrepresentation, purchasers have a civil right of action; and, the definition of “reporting issuer” is amended so that a private company will become a reporting issuer only after a securities exchange take-over for a reporting issuer.
Various exemptions are also amended. The current exemptions from the registration and prospectus requirements for certain trades in connection with an amalgamation, merger, reorganization or arrangement are clarified. The dividend reinvestment exemptions are expanded.