FSRA enhances protections for investors of high-risk offerings by co-operative corporations

The Financial Services Regulatory Authority of Ontario (FSRA) is developing Interpretation and Approach guidance that identifies higher risk offerings and sets out enhanced disclosures by co-operative corporations (co-ops) that are raising capital. We are now consulting on the proposed guidance.

The Co-operative Corporations Act (CCA) requires that co-ops provide “full, true and plain disclosure” in their offering statements. This protects investors and helps them make informed investment decisions.

The proposed guidance will set out specific risk factors and information that co-ops must disclose when issuing securities to comply with FSRA’s interpretation of the requirements under the CCA. This non-exhaustive list includes debt repayment details, insolvency rankings and financial obligations. Potential investors will better understand the related risks before deciding whether to purchase these securities.

The proposed guidance will apply to high-risk offerings by co-ops.

We invite you to submit feedback until November 18, 2020.

Useful link: 

• Results of FSRA Consultation on Interpretation and Approach Guidance No. CC0001INT: High-Risk Offerings issued under the Co-operative

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