The Ontario Securities Commission is looking for commentary on four new prospectus exemptions that would help businesses raise capital at different stages of development.
- an offering memorandum exemption that would allow businesses to raise capital based on a comprehensive disclosure document being made available to investors;
- a family, friends and business associates exemption that’s intended to enable start-ups and early-stage businesses to raise capital from investors within the personal networks of the principals of the business;
- an existing security holder exemption that would allow public companies listed on the Toronto Stock Exchange, TSX Venture Exchange or Canadian Stock Exchange to raise capital from their existing security holders based on their public disclosure record; and
- a crowdfunding exemption that would allow businesses, particularly start-ups and early stage businesses, to raise capital from a potentially large number of investors through an online platform registered with the securities regulators.
The publication of these proposals follows a comprehensive review by the OSC of the exempt market. As part of that review, OSC considered the written comments received on earlier proposals.
The Commission also met with many stakeholders and launched an online survey to gauge the views of retail investors on investing in start-ups, as well as small and medium-sized enterprises.
These exemptions “will transform Ontario’s exempt market by providing greater access to capital for businesses and expanding investment opportunities for investors,” says Howard Wetston, Q.C., Chair and CEO of the OSC.
The comment period runs until June 18, 2014.
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