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This enactment replaces the Small Business Loans Act in order to
reform the Small Business Loans Program. The purpose of the Program
is to increase the availability of financing for the establishment,
expansion, modernization and improvement of businesses with gross
annual revenues of up to $5 million by allocating, between the Minister
and lenders, portions of eligible losses incurred by lenders in relation to
loans of up to $250,000 to such businesses for those purposes. The key
elements of the enactment are the following:
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(a) it provides for the continuous operation of the Program subject
to a comprehensive program review every five years;
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(b) it limits the Minister's aggregate contingent liability to $1.5
billion for each five-year period;
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(c) it authorizes the Minister to conduct compliance audits and
examinations;
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(d) it authorizes the establishment and operation of pilot projects to
determine whether the Program should be extended to include loans
to the voluntary sector and capital leases; and
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(e) it reforms the offence and punishment provisions.
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The Small Business Loans Act will continue to apply to loans made
before April 1, 1999 although certain provisions of the new legislation
with respect to fees and interim claim payments will also apply to those
loans.
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Clause 21: The relevant portion of subsection 427(1) reads as
follows:
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427. (1) A bank may lend money and make advances
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(m) to any aquaculturist for
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(v) any works for the improvement or development of an
aquaculture operation for which a business improvement loan, as
defined in the Small Business Loans Act, or a farm improvement
loan, as defined in the Farm Improvement Loans Act, may be
made,
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on the security of aquacultural equipment or aquacultural
implements, but security taken under this paragraph is not effective
in respect of aquacultural equipment or aquacultural implements
that, at the time the security is taken, by any statutory law that is then
in force, are exempt from seizure under writs of execution and the
aquaculturist is prevented from giving as security for money lent to
the aquaculturist,
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