The Ontario Securities Commission (“OSC”) recently made OSC Rule 45-508 Extension to Ontario Instrument 45-507 Self-Certified Investor Prospectus Exemption (the “Rule”) to extend relief granted previously in respect of Self-Certified Investors for an additional 18 months.

As we discussed in a previous post, Ontario Instrument 45-507 Self-Certified Investor Prospectus Exemption (Interim Class Order) (the “Instrument”) was published in October 2022 to provide a temporary exemption from the prospectus requirement for non-investment fund issuers that have a head office in Ontario and distribute securities to Self-Certified Investors, if certain conditions are met. To qualify as a “Self-Certified Investor”, a purchaser must deliver to the issuer a completed: (i) “Confirmation of Qualifying Criteria”, confirming that the investor meets the qualifying criteria; and (ii) “Acknowledgement of Risks”, confirming that the investor has read and understood each of the statements of risks relating to the investment. The Instrument allows purchasers in Ontario who may not meet the financial thresholds or other criteria to qualify as an accredited investor to invest in issuers on a prospectus-exempt basis, provided that other criteria demonstrating financial knowledge, investment knowledge or relevant industry-specific experience are met. The Instrument was initially intended to remain in effect until the earlier of: (i) April 25, 2024, unless extended by the OSC; and (ii) the effective date of an amendment to National Instrument 45-106 Prospectus Exemptions that adopts a similar exemption.

Subject to ministerial approval, the Rule will come into force on April 25, 2024, and extend the exemption provided in the Instrument until October 25, 2025.

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