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New Continuous Disclosure Rules


Area Corporate and Commercial, Corporate Finance and Securities, Shareholder Rights and Activism


In December 2003, the Canadian Securities Administrators (“CSA”) published National Instrument 51-102 – Continuous Disclosure Obligations (the “Rule”), which, among other things, provides a nationally harmonized and simplified set of continuous disclosure requirements for reporting issuers other than investment funds.  In addition to the Rule, the CSA also published Companion Policy 51-102CP, which provides guidance as to the manner in which the CSA will interpret and apply the Rule.  The Rule establishes consistent disclosure standards across Canada for reporting issuers in respect of financial statements, management’s discussion and analysis (“MD&A”), reporting of material changes, reporting of significant business acquisitions, annual information forms (“AIFs”), executive compensation disclosure, shareholder meeting materials, disclosure in respect of restricted shares and other filing requirements.


It is expected that the Rule will be adopted in all jurisdictions and, with the necessary government approvals, will come into force on March 30, 2004.  The requirements in the Rule concerning annual and interim financial statements (except change in year-end, change in corporate structure and change of auditor requirements), MD&A and AIFs will apply for financial years commencing on or after January 1, 2004.  The requirements relating to business acquisition reports will apply to significant acquisitions if the relevant agreement was entered into after March 30, 2004.  The requirements relating to proxy solicitation and information circulars will apply from and after June 1, 2004.  All other requirements will apply as of March 30, 2004.


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