Further Developments In Private Placement Exemptions For Start-Ups

The Canadian Securities Administrators (CSA) continue to develop prospectus exemptions designed to facilitate access to capital for start-ups.

In March of 2014, certain members of the CSA, including Ontario, published proposed Multilateral Instrument 45-108 Crowdfunding ("MI 45-108") for comment (see our April 1, 2014 Update, Four New Private Placement Exemptions Proposed). Crowdfunding is a method of funding projects or ventures by raising small amounts of money from a large number of people through a funding portal.

While MI 45-108 has not been adopted as a rule, in May of 2015, the securities regulators in British Columbia, Manitoba, Nova Scotia, New Brunswick, Quebec and Saskatchewan adopted local blanket orders permitting crowdfunding under certain conditions (the "Crowdfunding Blanket Orders").