Grade A Obligations: New Ontario AFS Non-delivery List

On October 8, the Ontario Securities Commission (OSC) announced measures relating to the use of the Offering Memorandum Prospectus Exemption in section 2.9 of National Instrument 45-106 Prospectus Exemptions. As signaled in other publications, the OSC will be enhancing its monitoring of the use of the exemption. As a result, both issuers relying on the offering memorandum exemption and exempt market dealers distributing these products should ensure the issuers comply with all requirements of the exemption.

Under the Offering Memorandum Prospectus Exemption, an issuer must, within 120 days of its financial year end, deliver annual audited financial statements to the OSC, prepared in accordance with IFRS, among other delivery requirements. In order to provide retail investors with additional information on non-reporting issuers raising capital in the exempt market, it has introduced an AFS non-delivery list (the List).