Cooperative Credit Associations Act (S.C. 1991, c. 48)

Marginal note:Constraining registration

355 No association shall, unless the acquisition of the share has been approved by the Minister, record in its securities register a transfer or issue of any share of the association to any person or to any entity controlled by a person if

• (a) the transfer or issue of the share would cause the person to have a significant interest in any class of shares of the association; or

• (b) where the person has a significant interest in a class of shares of the association, the transfer or issue of the share would increase the significant interest of the person in that class of shares of the association.

Marginal note:Exception for small holdings

355.1 Notwithstanding section 355, where, as a result of a transfer or issue of shares of a class of shares of an association to a person, the total number of shares of that class registered in the securities register of the association in the name of that person

• (a) would not exceed five thousand, and

• (b) would not exceed 0.1 per cent of the outstanding shares of that class,

the association is entitled to assume that no person is acquiring or increasing a significant interest in that class of shares of the association as a result of that issue or transfer of shares.

Marginal note:Where approval not required

• 356 (1) Notwithstanding subsections 354(1) and (2) and section 355, approval of the Minister is not required where a person with a significant interest in a class of shares of an association or an entity controlled by a person with a significant interest in a class of shares of an association

  • (a) purchases or otherwise acquires shares of that class, or

  • (b) acquires control of any entity that holds any share of that class,

  and the number of shares of that class purchased or otherwise acquired, or the acquisition of control of the entity, as the case may be, would not increase the significant interest of the person in that class of shares of the association to a percentage that is greater than the percentage referred to in subsection (2) or (3), whichever is applicable.

• Marginal note:Percentage

  (2) Subject to subsection (3), for the purposes of subsection (1), the percentage is 5 percentage points in excess of the significant interest of the person in that class of shares of the association on the later of the day this Part comes into force and the day of the most recent purchase or other acquisition by

  • (a) the person, or

  • (b) any entity controlled by the person, other than the entity referred to in paragraph (1)(b),

  of shares of that class of shares of the association, or of control of an entity that held shares of that class of shares of the association, for which approval was given by the Minister.

• Marginal note:Idem

  (3) Where a person has a significant interest in a class of shares of an association and the person’s percentage of that class has decreased after the date of the most recent purchase or other acquisition by

  • (a) the person, or

  • (b) any entity controlled by the person, other than the entity referred to in paragraph (1)(b),

  of shares of that class of shares of the association, or of control of an entity that held shares of that class of shares of the association, for which approval was given by the Minister, the percentage for the purposes of subsection (1) is the percentage that is the lesser of

  • (c) 5 percentage points in excess of the significant interest of the person in that class of shares of the association on the later of the day this Part comes into force and the day of the most recent purchase or other acquisition by

    • (i) the person, or

    • (ii) any entity controlled by the person, other than the entity referred to in paragraph (1)(b),

    of shares of that class of shares of the association, or of control of an entity that held shares of that class of shares of the association, for which approval was given by the Minister, and

  • (d) 10 percentage points in excess of the lowest significant interest of the person in that class of shares of the association at any time after the later of the day this Part comes into force and the day of the most recent purchase or other acquisition by

    • (i) the person, or

    • (ii) any entity controlled by the person, other than the entity referred to in paragraph (1)(b),

    of shares of that class of shares of the association, or of control of an entity that held shares of that class of shares of the association, for which approval was given by the Minister.

• Marginal note:Exception

  (4) Subsection (1) does not apply if the purchase or other acquisition of shares or the acquisition of control referred to in that subsection would

  • (a) result in the acquisition of a significant interest in a class of shares of the association by an entity controlled by the person and the acquisition of that investment is not exempted by the regulations; or

  • (b) result in an increase in a significant interest in a class of shares of the association by an entity controlled by the person by a percentage that is greater than the percentage referred to in subsection (2) or (3), whichever applies, and the increase is not exempted by the regulations.

• Marginal note:Regulations

  (5) The Governor in Council may make regulations

  • (a) exempting from the application of paragraph (4)(a) the acquisition of a significant interest in a class of shares of the association by an entity controlled by the person; and

  • (b) exempting from the application of paragraph (4)(b) an increase in a significant interest in a class of shares of the association by an entity controlled by the person by a percentage that is greater than the percentage referred to in subsection (2) or (3), whichever applies.

Marginal note:When approval not required

• 357 (1) Despite subsections 354(1) and (2) and section 355, the approval of the Minister is not required if

  • (a) the Superintendent has, by order, directed the association to increase its capital and shares of the association are issued and acquired in accordance with the terms and conditions, if any, that may be specified in the order; or

  • (b) a person who controls, within the meaning of paragraph 3(1)(d), the association acquires additional shares of the association.

• Marginal note:Pre-approval

  (2) For the purposes of subsections 354(1) and (2) and section 355, the Minister may approve

  • (a) the purchase or other acquisition of such number or percentage of shares of an association as may be required in a particular transaction or series of transactions; or

  • (b) the purchase or other acquisition of up to a specified number or percentage of shares of an association within a specified period.

Marginal note:Application for approval

• 358 (1) An application for an approval of the Minister required under this Part must be filed with the Superintendent and contain the information, material and evidence that the Superintendent may require.

• Marginal note:Applicant

  (2) If, with respect to any particular transaction, this Part applies to more than one person, any one of those persons may make the application to the Minister for approval on behalf of all of those persons.

Marginal note:Matters for consideration

358.1 If an application for an approval under subsection 354(1) is made, the Minister, in determining whether or not to approve the transaction, shall take into account all matters that the Minister considers relevant to the application, including

• (a) the nature and sufficiency of the financial resources of the applicant or applicants as a source of continuing financial support for the association;

• (b) the soundness and feasibility of the plans of the applicant or applicants for the future conduct and development of the business of the association;

• (c) the business record and experience of the applicant or applicants;

• (d) the character and integrity of the applicant or applicants or, if the applicant or any of the applicants is a body corporate, its reputation for being operated in a manner that is consistent with the standards of good character and integrity;

• (e) whether the association will be operated responsibly by persons with the competence and experience suitable for involvement in the operation of a financial institution;

• (f) the impact of any integration of the businesses and operations of the applicant or applicants with those of the association on the conduct of those businesses and operations;

• (g) whether the association is to be operated in accordance with cooperative principles; and

• (h) the best interests of the financial system in Canada and, in particular, the cooperative financial system in Canada.

Marginal note:Terms and conditions

359 The Minister may impose any terms and conditions in respect of an approval given under this Part that the Minister considers necessary to ensure compliance with any provision of this Act.

Marginal note:Certifying receipt of application

• 360 (1) Where, in the opinion of the Superintendent, an application filed with the Superintendent under subsection 358(1) contains all the required information, the Superintendent shall forthwith refer the application to the Minister and send a receipt to the applicant certifying the date on which the completed application was received by the Superintendent.

• Marginal note:Incomplete application

  (2) Where, in the opinion of the Superintendent, an application filed under subsection 358(1) is incomplete, the Superintendent shall send a notice to the applicant specifying the information required by the Superintendent to complete the application.

Marginal note:Notice of decision to applicant

• 361 (1) Subject to subsections (2) and (3) and section 362, the Minister shall, within a period of thirty days after the certified date referred to in subsection 360(1), send to the applicant

  • (a) a notice approving the transaction to which the application relates; or

  • (b) if the Minister is not satisfied that the transaction to which the application relates should be approved, a notice to that effect, advising the applicant of the right to make representations to the Minister in respect of the matter.

• Marginal note:Notice of decision

  (2) Subject to subsections (4) and 362(2), if an application involves the acquisition of control of an association, the Minister shall, within a period of forty-five days after the certified date referred to in subsection 360(1), send to the applicant

  • (a) a notice approving the transaction to which the application relates; or

  • (b) if the Minister is not satisfied that the transaction to which the application relates should be approved, a notice to that effect, advising the applicant of the right to make representations to the Minister in respect of the matter.

• Marginal note:Extension of period for notice

  (3) If the Minister is unable to complete the consideration of an application within the period referred to in subsection (1), the Minister shall

  • (a) within that period, send a notice to that effect to the applicant; and

  • (b) within a further period of thirty days after the date of the sending of the notice referred to in paragraph (a) or within any other further period that may be agreed on by the applicant and the Minister, send a notice referred to in paragraph (1)(a) or (b) to the applicant.

• Marginal note:Further extensions

  (4) If the Minister considers it appropriate to do so, the Minister may extend the period referred to in subsection (2) for one or more periods of forty-five days.

Marginal note:Reasonable opportunity to make representations

• 362 (1) Where, after receipt of the notice referred to in paragraph 361(1)(b), the applicant advises the Minister that the applicant wishes to make representations, the Minister shall provide the applicant with a reasonable opportunity within a period of thirty days after the date of the notice, or within such further period as may be agreed on by the applicant and the Minister, to make representations in respect of the matter.

• Marginal note:Reasonable opportunity to make representations

  (2) If after receipt of the notice referred to in paragraph 361(2)(b) the applicant advises the Minister that the applicant wishes to make representations, the Minister must provide the applicant with a reasonable opportunity within a period of forty-five days after the date of the notice, or within any further period that may be agreed on by the applicant and the Minister, to make representations in respect of the matter.