The Canadian Securities Administrators are proposing amendments to the prospectus exemption rules and investment fund continuous disclosure rules to accommodate the changeover to International Financial Reporting Standards.

The various members of the CSA, except the Autorité des marchés financiers and the New Brunswick Securities Commission, are publishing for a 90 day comment period proposed amendments to address proposed changes to securities legislation arising from the upcoming transition to IFRS, which is slated to occur by January 1, 2011.

Among other things, the regulators are proposing amendments that will replace Canadian GAAP terms and phrases with IFRS terms and phrases, and change disclosure requirements in instances where IFRS contemplates different financial statements than existing Canadian GAAP in the prospectus exemption rules.

The CSA says these changes will benefit investors by creating a more consistent interpretation of the rules, more consistent disclosure practices that should increase transparency, and higher quality disclosure.

Securities regulators are also proposing amendments to the continuous disclosure rules for investment funds to update the accounting terms and phrases in those rules.

The CSA notice says that the AMF and the NBSC will publish their own staff notice that sets out the substantive proposed changes being published in the other CSA jurisdictions. “Because of the legal obligation to publish amending instruments simultaneously in French and English in Quebec and New Brunswick, and because the French IFRS terminology is still in a state of flux, publication for comment of proposed amendments in these provinces is presently not feasible,” it says.

However, it is expected that they will publish corresponding proposed amendments, in French and in English, for comment during the first quarter of 2010. Nevertheless, market participants in Quebec and New Brunswick are encouraged to comment on the substantive proposed changes presented in the staff notices and on the amendments published by the other jurisdictions, the CSA says.

Comments are due by Jan. 18, 2010 for the amendments to prospectus rules and January 14 for the investment fund rules.

IE