Regulator lengthens timelines related to reviews, applications, and other registration materials amid surge in capital raising
Faced with a “significant and persistent increase” in applications and filings to participate in Ontario’s capital markets, the Ontario Services Commission (OSC) is temporarily changing its service commitments.
The regulator said it is implementing the temporary adjustment, which is to stay in effect from December 7, 2021 until June 30 next year. All preliminary prospectuses and exemptive relief applications filed after December 7 will be processed in accordance with the temporary service commitments.
Some changes to the OSC’s commitments include, among others:
- Providing a first comment letter within 15 working days of preliminary receipt of a prospectus (formerly 10 working days);
- Providing a first comment letter within 15 working days of receiving an exemption application in a complete and adequate form (formerly 10 working days);
- Deciding on requests for routine exemptive relief within 45 working days of receiving a complete and adequate application (formerly 40 days);
- Making a decision on routine applications for dealing representatives within 10 working days of receiving a complete, adequate, and acceptable application (formerly 5 working days).
In its news release announcing the changes, the OSC said capital raising in the province is showing continued extraordinary growth.
Prospectus volumes have risen approximately 30% year over year, and the regulator anticipates over 800 to be filed in 2022, a 104% increase over filings in 2019. Registration volumes are also anticipated to rise as the first half of 2021 saw two thirds (67%) more new firm applications than the comparable period last year.
“Additionally, the OSC is seeing a large volume of applications and filings from firms with complex or novel business models,” the regulator said. “These applications and filings raise new policy issues that must be carefully considered and communicated, in consultation with other regulators, for the benefit of all market participants.”
As long as the temporary changes to its service commitments are in effect, the OSC said its staff will not review pre-files for draft preliminary base shelf prospectuses or non-offering prospectuses under its confidential pre-file program.
During its next annual review, the OSC said it will conduct a comprehensive evaluation of all its service commitments, including applications and filings received while the temporary changes are in force.
Following that evaluation, the OSC said it will publish any further changes to its service commitments at the end of Q1 2022 on June 30.
