CSA CP 51-504 Access Equals Delivery

February 26, 2020

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CSA CP 51-504 Access Equals Delivery

Letter Summary:

The CSA is soliciting views on the suitability of introducing an “access equals delivery” model in the Canadian market, such that delivery of a document would be effected by the issuer alerting investors through a news release that the document is publicly available on the System for Electronic Document Analysis and Retrieval (SEDAR) and the issuer’s website. They are also looking for input on which documents (prospectuses, financial statements, MD&A and other) should be included in an access equals delivery model. 

Overview of the Council’s Comments:

We are supportive of the CSA’s initiatives to reduce regulatory burden without having a negative impact on investor protection, and are in favour of facilitating electronic delivery of documents where possible.  

We are supportive of the proposal to facilitate an access equals delivery model for the distribution of prospectus documents, financial statements and MD&A filings.

Regardless of the timing of the implementation of the proposal, the issuer should be required to post the documents prominently on their website in an easily accessible format.  The enforcement powers of CSA members should specifically extend to issuers that post documents in an obscure manner or in circumstances where documents are not posted in a timely and accessible fashion.

As the CSA continues to consider the Proposed National Systems Renewal Program Rule and Related Amendments, the ability to reformulate the withdrawal mechanism based on new technological capabilities may emerge.  

The requirement to provide paper copies of documents upon request should be at no charge to the investor, as there remain some retail investors with intermittent to no online access.  The enforcement powers of CSA members should also specifically extend to instances where paper copies are not easily accessible.

To the extent possible, aligning the initiative with international counterparts may bring some consistency to issuers and international investors.

We understand that the CSA is also considering whether other issuer documents such as rights offering materials and take-over bid circulars should be included in the access equals delivery model.  As set out in the notice of the Consultation, extending the model to time-sensitive documents and processes that require shareholder participation could, and we believe does, raise investor protection concerns in the near term.