Starting in the fall, public companies will be able to switch to alerting investors to certain continuous disclosure filings — rather than sending them out directly — under rule changes finalized by the Canadian Securities Administrators (CSA).
In a notice published Thursday, the regulators adopted final reforms to implement a new model that will enable companies (not including investment funds) to meet their disclosure obligations for certain continuous disclosure documents — including annual financial statements and quarterly reports to investors — by providing electronic access to those filings, and alerting investors via a news release.
The CSA’s new model is voluntary for companies — issuers aren’t required to adopt this approach — and, investors are also still entitled to receive disclosure directly, in hard copy, or electronic form, if they want it.
Yet, the new model represents the culmination of a long-running effort to modernize disclosure delivery requirements. In 2020, the CSA initiated a consultation process to solicit views on a proposed shift to an “access equals delivery” model for companies’ continuous disclosure filings.
While issuers have generally supported efforts to shift to more electronic filings as a way of saving compliance costs, investor advocates have expressed concerns about a move to an “access equals delivery” model potentially disadvantaging certain investors.
In response to this feedback, the CSA sought to enhance the investor protections set out in the initial proposals — and the SEDAR+ filing system has also been beefed up to allow investors to subscribe for email notifications of new filings.
Since the latest version of the proposals was published in 2024, the regulators have further tweaked the requirements to also give more flexibility to issuers when it comes to their obligation to provide investors with annual reminders of their use of the new disclosure model, and to various other filing requirements.
However, the CSA noted that those changes aren’t material, so the rules are now in final form.
Assuming that they’re approved by the various providers, the new regime takes effect on Sept. 22.
“This access model is consistent with the general evolution of our capital markets and recognizes that investors are increasingly accessing and consuming information electronically,” said Stan Magidson, chair of the CSA and chair and CEO of the Alberta Securities Commission (ASC), in a release.
“Using technology to facilitate communication with investors is an important step for our markets,” he added.