The Ontario Securities Commission (“OSC”) recently made proposed OSC Rule 33-509 Exemption from Underwriting Conflicts Disclosure Requirements (the “Rule”) to provide a permanent exemption in Ontario from the underwriting conflicts disclosure requirements in National Instrument 33-105 Underwriting Conflicts in respect of foreign private placements to sophisticated investors.

As we discussed in a previous post, the OSC issued Ontario Instrument 33-507 Exemption from Underwriting Conflicts Disclosure Requirements (Interim Class Order) (the “Blanket Order”) in February 2021 that provided a temporary exemption from the underwriting conflicts disclosure requirements where: (i) the distribution is made under an exemption from the prospectus requirement; (ii) the distribution is of an eligible foreign security; and (iii) each purchaser in Ontario is a permitted client. The Blanket Order was extended in March 2022 and is currently set to expire on February 17, 2024.

The Rule will make the exemption set out in the Blanket Order permanent. The OSC has indicated that without an extension, institutional investors in Ontario may again experience difficulties in participating in global offerings on a timely basis.

The Rule was delivered to the Minister of Finance and will come into force on February 17, 2024, if approved.

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