• OSC Provides Guidance for Possible Relief of Participation Fees for Small Firms and Issuers
  • March 28, 2014 | Author: Tiffany Lee Bianchi
  • Law Firm: Perley-Robertson, Hill & McDougall LLP/s.r.l. - Ottawa Office
  • Staff of the Ontario Securities Commission (OSC) recently published Staff Notice 13-704 Applications for Participation Fee Relief for Certain Small Registered Firms and Reporting Issuers (“Notice 13-704”) to consider granting participation fee relief on an expedited basis to certain small registered firms and reporting issuers.

    The rules governing participation fees are established in OSC Rule 13-502 Fees which sets out the participation fees payable by a registered firm or reporting issuer using a tiered structure based on specified Ontario revenues for registered firms and on capitalization for reporting issuers.

    Notice 13-704 contemplates the granting of participation fee relief by way of an expedited application process to registered firms and the categories of reporting issuers listed below based on their 2013 fiscal year:

    Class 1 reporting issuer - a reporting issuer that is incorporated or organized under the laws of Canada or a jurisdiction in Canada and that, at the end of its previous fiscal year, has securities listed or quoted on a marketplace in Canada or in the U.S.; or
    Class 3C reporting issuer - a reporting issuer that is not incorporated or organized under the laws of Canada or a jurisdiction in Canada and whose trading volume in its previous year of securities listed or quoted on marketplaces in Canada was greater than the trading volume in its previous fiscal year of its securities listed or quoted on marketplaces outside Canada.

    The eligibility to apply for relief or a refund using an expedited relief process is outlined in Notice 13-704. This relief would be available to (i) registered firms with specified Ontario revenues under $1 million and reporting issuers with capitalization under $50 million; and (ii) registered firms or reporting issuers whose 2013 specified Ontario revenues or capitalization, as the case may be, has decreased by at least 50% from their specified Ontario revenues or capitalization in 2011.

    Registered firms or reporting issuers that meet the criteria set out above and follow the process outlined in Notice 13-704 would be considered for a one-time 50% refund or reduction of their participation fees, subject to the payment of the minimum participation fee of $800. Accordingly, such firms or issuers are invited to apply for the participation fee relief or a refund by no later than March 31, 2014.