Fasken Martineau lawyers provide comments in regard to the CSA's Proposals in Response to the 2007-08 Credit Market Turmoil and its Effect on the ABCP Market in Canada
February 16, 2009
On October 6, 2008, the Canadian Securities Administrators (CSA) issued a Consultation Paper outlining several securities regulatory proposals related to the Canadian non-bank sponsored asset-backed commercial paper (ABCP) market.
Shortly after events in international credit markets led to a seizure of the non-bank sponsored portion of the ABCP market in Canada, the CSA took a number of steps, which included the formation of an ABCP working group to address securities regulatory issues stemming from the credit market turmoil. Those issues are examined in the CSA Consultation Paper.
The CSA Consultation Paper contains proposals and solicits comments on a number of questions related to the proposals for:
1. Implementing a regulatory framework applicable to credit rating agencies that would require compliance with the recently amended code of conduct established by the International Organization of Securities Commissions (IOSCO). In addition, the CSA is considering requiring public disclosure of all information provided by an issuer that is used by a credit rating agency in rating an asset backed security;
2. Amending the short-term debt exemption to make it unavailable for sales of asset-backed short-term debt including ABCP. This would require issuers who sell these products to do so by way of prospectus, or under another exemption;
3. Reducing reliance on the use of credit ratings in securities legislation;
4. Addressing the roles played by dealers and advisers with respect to ABCP; and
5. Reviewing specific issues regarding mutual fund investments in ABCP.
Comments were due on February 16, 2009. A team of Fasken Martineau lawyers and students consisting of Geoff Clarke, Brandon Tigchelaar and Patrick Dolan (student-at-law) submitted a comment letter.
The CSA Consultation Paper is available by clicking here.
The IOSCO Code of Conduct is available by clicking here.
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Stephen HastingsDirector of Communications +1 416 865 4370 +1 416 648 4076 (cell) shastings@fasken.com
Mathieu Rompré
Communications and Media Specialist +1 514 397 4349 +1 514 298 6739 (cell)
Estelle Giry
Communications and Media Specialist Europe / Africa +44 (0)20 7917 8602 +44 (0)7917 834 207 (cell)
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