CSA Staff Notice: Frequently Asked Questions for New Insider Reporting Requirements
On April 30, National Instrument 55-104 Insider Reporting Requirements and Exemptions came into effect, although the new five-day filing deadline for subsequent reports only takes effect October 31, 2010. The consolidated reporting requirements aim to harmonize, simplify and streamline how insiders report their operations to the public. Our previous Legal Update discusses several of the changes to the previous insider reporting requirements.
Two days before NI 55-104 came into effect, the Canadian Securities Administrators (CSA) published CSA Staff Notice 55-315 Frequently Asked Questions about National Instrument 55-104 Insider Reporting Requirements and Exemptions to assist reporting insiders, issuers and other market participants with these changes. It was also published to promote consistency in electronic filings on the system for electronic disclosure by insiders.
CSA Staff Notice 55-315 contains seven questions that the CSA have received in connection with the transition to the new requirements. It may be updated by the CSA to reflect additional questions or concerns as they arise. Important questions addressed in this version include:
- Do existing insiders have to file a new initial report within 10 days of April 30, 2010?
- Can a reporting insider rely on the exemption in Part 5 of NI 55-104 (exemption for automatic securities purchase plans) for a grant of related financial instruments under a compensation arrangement?
- How does one report a grant of related financial instruments made prior to April 30, 2010?
- What information does an issuer need to include in an issuer grant report?
- If an issuer files an issuer grant report within the normal filing period, but an insider then files an insider report about the grant after the normal filing deadline has expired, will there be a late fee for that filing?
We can expect in the near future the following related publications from the CSA:
- CSA Staff Notice 55-312 Insider Reporting Guidelines for Certain Derivative Transactions (Monetization) (REVISED)
- CSA Staff Notice 55-316 Questions and Answers on Insider Reporting and the System for Electronic Disclosure by Insiders (SEDI).