Adoption Of New Alberta OTC Derivatives Order To Reflect Pending Legislative Changes

Earlier this week, Alberta Securities Commission staff proposed replacing ASC Blanket Order 91-505 Over-the-Counter Derivatives Transactions, with a new blanket order aimed at conforming the prospectus and dealer registration exemptions available under the existing order to pending amendments to the Securities Act.

The pending amendments will, among other things, exclude "futures contracts" from the definition of "security" while introducing the concept of "derivatives" (which will exclude any products that have attributes of a derivative but are also a security, referred to as "derivative-like securities") and exclude derivatives from the prospectus requirement entirely. As a result, the new blanket order will no longer provide a prospectus exemption for derivatives.