Office of the Superintendent of Financial Institutions
*As defined in subsections 3(1)(d) of the BA, ICA and TLCA as well as subsection 3(1)(e) of the CCAA.
The applicant is generally expected to provide a description of the transaction, including:
the name of the entity for which approval for giving up control in fact is requested;
a detailed description of the activities of the entity and the legislative provision under which the applicant is permitted to hold control of the entity or a substantial investment in the entity;
the rationale for giving up control in fact of the entity while maintaining another type of control;
a detailed description of the agreement that will confer control in fact to another person; and
details of the applicant’s relationship to the entity both before and after giving up control in fact, including:
the number, value and percentage of each class of share or ownership interest held by the applicant and its subsidiaries; and
the aggregate value of loansFootnote 1 that the applicant and its subsidiaries, whether individually or jointly, have made to the entity.
A key feature of the control requirement is to address concerns over the risks to reputation to which a federally regulated entity is exposed when it has a substantial investment in an entity whose activities are closely related to the business of banking, insurance, financial intervention or investment. When reviewing an application for giving up control in fact, OSFI will assess the impact of giving up control on these risks.
A bank or bank holding company that controls a bank or a bank holding company may not give up control in fact of these entities while maintaining another type of control.
This approval is subject to a user pay fee.
The information requirements and administrative guidance are intended to satisfy typical applications. They have been derived from OSFI’s experience in assessing applications. Applicants who provide all information and material requested can generally expect a more timely assessment of their applications. As appropriate to the circumstances, OSFI may request additional information, take into account other matters, impose terms and conditions, or require undertakings.
See definition in subsection 464(1) of the BA, 386(1) of the CCAA, 490(1) of the ICA or 449(1) of the TLCA.
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