Insurance Companies Act

Marginal note:Inadmissible assets

• 612 (1) A foreign company may not vest in trust

  • (a) securities issued by or debt obligations of the foreign company or one of its affiliates;

  • (b) real property, or ground rents or mortgages on real property, situated outside Canada;

  • (c) shares or ownership interests, however designated, in any entity in such number as would constitute a substantial investment in that entity without regard to any shares or ownership interests held by any other entity; or

  • (d) a loan made in Canada on the security of residential property in Canada for the purpose of purchasing, renovating or improving that property, if the amount of the loan, together with the amount then outstanding of any mortgage having an equal or prior claim against the property, would exceed 80 per cent of the value of the property at the time of the loan.

• Marginal note:Exception

  (2) Despite paragraphs (1)(a) and (c), a foreign company may vest in trust a substantial investment in an entity that is primarily engaged in

  • (a) holding, managing or otherwise dealing with real property; or

  • (b) holding shares or ownership interests in entities that are primarily engaged in any of the activities referred to in paragraph (a).

• Marginal note:Idem

  (3) Notwithstanding paragraph (1)(d), a foreign company may vest in trust

  • (a) a loan made or guaranteed under the National Housing Act or any other Act of Parliament by or pursuant to which a different limit on the value of property on the security of which the foreign company may make a loan is established;

  • (b) a loan if repayment of the amount of the loan that exceeds the maximum amount set out in subsection (1) is guaranteed or insured by a government agency or a private insurer approved by the Superintendent; or

  • (c) securities issued or guaranteed by an entity that are secured on any residential property, whether in favour of a trustee or otherwise, or a loan made by the foreign company to the entity against the issue of such securities.