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Canadian developments affecting cross-border offerings of securities

Author(s): James R. Brown, Jason Comerford, Rosalind Hunter, Desmond Lee, François Paradis, Trevor R. Scott, Andrea Whyte

Dec 18, 2018

With cannabis companies dominating the headlines in 2018, it was easy to overlook other Canadian developments affecting capital markets activities. In this article, we focus on key developments impacting cross-border offerings of securities, including several rules which together facilitate the distribution and resale of securities outside of Canada, something akin to “Regulation S” in the United States. We also highlight certain considerations applicable to U.S.-only initial public offerings (IPOs) by Canadian issuers as well as an important difference between Canadian and U.S. practice relating to the ability to confidentially submit a draft prospectus in connection with an offering.

Safe harbours for distributions of securities to investors outside of Canada

Canada has no general equivalent to U.S. Regulation S, which allows offerings outside the United States to proceed without registration with the U.S. Securities and Exchange Commission (SEC). As a result, determining whether a Canadian prospectus requirement applies to...

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