On April 14, 2022, the Canadian Securities Administrators (CSA) issued a consultation paper (the “Consultation Paper”) seeking feedback about the efficacy of certain key provisions of National Instrument 43-101 Standards of Disclosure for Mineral Projects (NI 43-101), and whether regulatory changes would address concerns expressed by certain stakeholders. The CSA are accepting comments on the Consultation Paper until July 13, 2022.
Purpose of NI 43-101
NI 43-101 governs disclosure of scientific and technical information regarding mineral projects of issuers that operate in the mining industry to protect the investing public and the integrity of the Canadian capital markets. All disclosure, whether oral or written, must be based upon information prepared by and under the supervision of a “qualified person”, and specified terminology is required when disclosing mineral resources and mineral reserves. In addition, mining issuers must prepare and file technical reports prepared by one or more qualified persons (who, in certain cases must be independent of the mining issuer).
Reasons for Change
As noted in the Consultation Paper, Canada plays a key role in mining capital formation and NI 43-101 is globally renowned as a leading standard for mineral project disclosures. However, the CSA believes there are a few reasons why improving and modernizing NI 43-101 might be required.
First, the Consultation Paper mentions that the mining industry has experienced various changes since NI 43-101 was last amended in 2011, which include (i) updates to definitions and best practices guidelines by the Canadian Institute of Mining, Metallurgy and Petroleum, (ii) emerging demand for commodities related to the growth in green energy and carbon neutral initiatives, (iii) increased awareness of the risks related to mineral project development, and (iv) an improvement of mineral project reporting codes and disclosure standards by other influential jurisdictions, including the United States and Australia.
The Consultation Paper also indicates that since 2011 the CSA has continually monitored the mineral disclosure requirements in NI 43-101 and gathered data evidencing certain deficiencies identified through continuous disclosure reviews, prospectus reviews, and targeted issue-oriented reviews.
Key Issues for Consultation
The CSA are soliciting feedback from stakeholders on a wide range of issues under NI 43-101, including questions and concerns relating to:
- disclosure for pre-mineral resource stage projects;
- the alignment of NI 43-101 disclosure requirements with disclosure requirements of other influential mining jurisdictions;
- the 45-day period allowed for filing a technical report following the initial disclosure of technical information in certain circumstances;
- the definition of qualified person considering evidence gathered by the CSA showing inaccurate self assessments by qualified persons of their independence, competence, expertise or relevant experience;
- data verification disclosure;
- historical estimate disclosure;
- preliminary economic assessment disclosure;
- personal inspections requirements applicable to qualified persons and whether such inspections can be achieved through the use of remote technologies;
- exploration information disclosure requirements;
- mineral resource and mineral reserve estimation disclosure;
- environmental and social disclosure;
- rights of Indigenous People disclosure; and
- capital and operating costs and economic analysis disclosure.
For the time being, the CSA are focused on collecting information to understand how to improve the current mineral disclosure requirements. As stated by Louis Morisset, CSA Chair and President and CEP of the Autorité des marches financiers, “[t]he CSA wants to ensure that Canada continues to set the gold standard for effective and efficient disclosure about mining issuers’ material properties.”
A copy of the Consultation Paper, which includes specific questions the CSA are hoping stakeholders will address, can be found here.
For further information, please contact any member of our Capital Markets Group or Mining Group.
Mergers and AcquisitionsThe federal government is amending the requirements of the Canada Business Corporations Act (“CBCA”) relating to the beneficial ownership registry most private federal corporations are required to…
Capital MarketsOn November 16, 2023, the Canadian Securities Administrator (CSA) and the Investment Industry Regulatory Organization of Canada (now, the Canadian Investment Regulatory Association) (CIRO) published a…
TaxOn November 2, 2023, the Canada Revenue Agency (CRA) answered a series of questions as part of the Association de planification fiscal et financière’s annual conference in Quebec City that may have…
Ontario Securities Commission Clarifies Ground Rules for Confidential Disclosure of Material Non-Public InformationIn the recent decision of Kraft (Re), the Ontario Capital Markets Tribunal (the “Tribunal”) provided new guidance about when insiders and others can confidentially disclose material non-public…
Capital MarketsNeill May is a contributor to Canadian Lawyer magazine. This article first appeared in the October 2023 issue.Excerpt from "The never-ending debate about material changes in securities law":Even the…
REITS and Income SecuritiesStephen Pincus, Brenda Gosselin, and Bill Gorman have co-authored The Benefits of Canada - Cross Border and Foreign REITs in the third edition of The Legal Reviews Canada.To view the…
Capital MarketsGoodmans LLP acted for the underwriters in connection with a public offering by StorageVault Canada Inc. (“StorageVault”) of convertible senior unsecured debentures (the “Debentures”) on a bought deal…
Capital MarketsGoodmans LLP acted for E Automotive Inc. d/b/a EINC in its non-brokered private placement offering of 4,814,100 common shares ("Shares') to Intercap Equity Inc. at a price of C$4.23 per Share for…
Capital MarketsGoodmans LLP acted for Northwest Healthcare Properties Real Estate Investment Trust (the "REIT") in connection with the renewal of its existing base shelf prospectus and filing and obtaining a receipt…
Capital MarketsGoodmans LLP acted for Northwest Healthcare Properties Real Estate Investment Trust (the "REIT") in connection with a public offering whereby the REIT sold C$135 million aggregate principal amount of…
Capital MarketsGoodmans LLP acted for the syndicate of agents led by CIBC World Markets Inc., in connection with a public offering of C$1 billion aggregate principal amount of medium-term notes of Brookfield…
Capital MarketsGoodmans LLP acted for a syndicate of agents led by BMO Nesbitt Burns Inc., on the sale by Brookfield Renewable of C$400 million aggregate principal amount of medium-term notes, Series 15, due…
News & Events
Banking and Financial ServicesWe are pleased to share Goodmans lawyers have been recognized across Who's Who Legal's National Guide: Canada 2023. WWL National Guides identify national or regional leaders in a sector, industry…
Banking and Financial ServicesWe are pleased to announce Goodmans LLP has once again received top tier recognition from The Legal 500 Canada in their 2024 Guide released today. Recognition from The Legal 500 is based on…
Banking and Financial ServicesWe’re pleased to announce Goodmans was once again named to The Globe and Mail’s Canada’s Best Law Firms list, recognizing us as one of the country’s best law firms for 2024.Goodmans was…