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CSA issues guidance re continuous disclosure deadlines amidst COVID-19 pandemic

On March 16, 2020, the Canadian Securities Administrators (the “CSA”) issued a press release regarding a reporting issuer missing filing deadlines amidst the COVID-19 pandemic.

This press release follows the U.S. Securities and Exchange Commission’s (the “SEC”) announcement on March 4, 2020 in which the SEC announced it would be extending the deadline for publicly traded companies to file certain disclosure reports due between March 1 to April 30, 2020 for 45 days.

The guidance of the CSA is that a reporting issuer seeking reprieve from annual or interim financial statement reporting requirements as well as certain other continuous disclosure requirements can obtain temporary relief in the ordinary course, which includes applying for a management cease trade order (“MCTO”) under the CSA’s National Policy 12-203 (the “Policy”). A MCTO prohibits the trading in securities of a reporting issuer by the chief executive officer, chief financial officer, officer, director or a person or company who may have had access, directly or indirectly, to a material fact or change concerning the issuer that has not been publicly disclosed.

An issuer can apply to its principal securities commission pursuant to the Policy for a MCTO after an anticipated default for reporting requirements is identified. The Policy requires the issuer to submit the application about two weeks before the applicable filing deadline but the CSA’s guidance is that they will accommodate issuers applying under two weeks if necessary.

The Policy is limited to providing relief from “specified defaults”, which include the failure to file: annual financial statements; an interim financial report; an annual or interim management's discussion and analysis or annual or interim management report of fund performance; an annual information form; and a certification of filings under National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings.



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