INSURANCE COMPANIES ACTRegulatory Capital (Insurance Holding Companies) RegulationsP.C.2001-1795 200110
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Her Excellency the Governor General in Council, on the recommendation of the Minister of Finance, pursuant to section 1021a of the Insurance Companies Actb, hereby makes the annexed Regulatory Capital (Insurance Holding Companies) Regulations.S.C. 2001, c. 9, s. 465S.C. 1991, c. 47InterpretationDefinitionsThe following definitions apply in these Regulations.Act means the Insurance Companies Act. (Loi)minority interest means an equity interest, in an entity that is controlled by an insurance holding company, that is held by a person other thanthe insurance holding company; oran entity controlled by the insurance holding company. (participation minoritaire)Regulatory CapitalDefinition of regulatory capitalSubject to subsection (2), the regulatory capital of an insurance holding company, at any time, is the amount determined by the formulaA - BwhereAis the total of the amounts of the shareholders’ equity, minority interests and subordinated indebtedness that would be reported in the financial statements of the insurance holding company prepared as at that time in accordance with the accounting principles and specifications of the Superintendent referred to in subsection 887(4) of the Act; andBis the amount of goodwill that would be included in those financial statements.Restriction relating to securityIn calculating the amount of regulatory capital under subsection (1), an amount may be included in respect of a security only ifthe security is, by its terms, subordinate in right of payment to all liabilities of the entity that issued the security other than liabilities that, by their terms, rank equally with, or are subordinate to, that security;the security is issued and fully paid up; andin respect of subordinated indebtedness or a preferred share, the securityhas an initial minimum term of five years or more or has no term, andcannot be redeemed or purchased for cancellation in the first five years after it is issued.Coming into ForceComing into forceThese Regulations come into force on the day on which sections 970 and 984 of the Insurance Companies Act, as enacted by section 465 of the Financial Consumer Agency of Canada Act, chapter 9 of the Statutes of Canada, 2001, come into force.[Note: Regulations in force October 24, 2001, see SI/2001-102.]