The growing threat of the COVID-19 virus has altered our normal expectations, today our days are filled with rapid change and uncertainty. We anticipate that this new normal will continue to change our everyday reality for the foreseeable future.  We have seen regulatory and government change in all aspects of our life. The CSA is offering regulatory relief and guidance to issuers navigating their current regulatory and annual meeting commitments. It is a challenging time that will require us all to adopt and change our normal process.

Regulatory Relief

In response to growing demands placed on issuers due to the spread of COVID-19 Virus, CSA announced that they are providing Blanket Relief for issuers.  

Summary of the relief provided:

1. The CSA will provide temporary blanket relief of a 45-day extension for periodic filings normally required to be made on or before June 1, 2020 by issuers. This includes financial statements, management’s discussion and analysis, management reports of fund performance, annual information forms, technical reports, and certain other filings.
2. Issuers choosing to rely on this exemption and those complying with the conditions of the relief, will not need to file applications for management cease trade orders as they will not be noted in default.
3. The CSA is supportive of issuers taking measures to reduce risk of transmission with annual meetings -this includes virtual meetings. The CSA has published guidelines to be of assistance to issuers that may need to make changes to their regular annual meeting procedures.
4. All CSA proposals currently out for comment will have their comment periods extended by 45 days. 

Annual Meeting Guidance

The CSA has release guidance on conducting an annual meeting during the COVID-19 outbreak. However, the guidance is only for Annual meetings. Issuers should still contact their principal regulator for Proxy contests, special meetings for M&A transactions and obtaining approval for transaction under 61-101 to discuss appropriate steps. Issuers that have already sent and filed their meeting material, the guidelines provide some flexibility for instances of changing the date, time or location of an in-person annual meetings. Issuers can notify securityholders of the change without sending additional soliciting materials or updating its proxy-related materials if the reporting issuer:

• issues a news release announcing the change in the date, time or location;
• files the news release on SEDAR; and
• takes all reasonable steps necessary to inform all the parties involved in the proxy voting infrastructure (such as intermediaries, transfer agents, and proxy service providers) of the change.

The CSA annual meeting guidance also addresses the growing number of reporting issuers that are relying on virtual meeting this year.  The CSA’s expectation is that the reporting issuer will notify its securityholders, the parties involved in the proxy voting infrastructure, and other market participants of such plans in a timely manner and to disclose clear directions on the logistical details of the virtual or hybrid AGM, including how securityholders can remotely access, participate in, and vote at such AGM.

This disclosure should be included in the reporting issuer’s proxy-related materials. However, if the meeting material has already be sent and filed, it is not necessary to send additional soliciting materials or to update its proxy-related materials solely for the purpose of switching to a virtual or hybrid AGM, if the reporting issuer follows the steps described above for announcing a change in the AGM date, time or location.

It should be noted the conduct of AGMs is primarily subject to applicable corporate law and the reporting issuer’s constating documents, which do not fall under the jurisdiction of securities regulators. The CSA encourages reporting issuers to review these laws and documents when considering changes or alternatives to their upcoming AGMs. Should you have any questions or wish to discuss, please do not hesitate to contact Penny Rice (647-931-7389) or price@shorecrestgroup.com

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