|
|
(iii) two or more persons who are acting
in concert in relation to the entity and in
relation to the foreign bank would, if they
were one person, control the foreign bank
and control the entity,
|
|
|
|
(iv) the foreign bank, or an entity
associated with the foreign bank, acting
in concert in relation to the entity with
one or more other persons would, if they
were one person, control the entity, or
|
|
|
|
(v) a person who controls the entity acts
in concert in relation to the foreign bank,
with one or more other persons, such that,
if they were one person, they would
control the foreign bank;
|
|
|
|
(b) an entity may be associated with more
than one foreign bank; and
|
|
|
|
(c) a foreign bank may be associated with
another foreign bank.
|
|
| Deemed
substantial
investment by
foreign bank
|
(3) For the purposes of this Part, a foreign
bank is deemed to hold a substantial
investment in a Canadian entity if
|
|
|
|
(a) the foreign bank and one or more entities
associated with the foreign bank, or
|
|
|
|
(b) two or more entities associated with the
foreign bank
|
|
|
|
would, if they were one person, hold a
substantial investment in the Canadian entity.
|
|
| Deemed
substantial
investment by
entity
associated
|
(4) For the purposes of this Part, an entity
associated with a foreign bank is deemed to
hold a substantial investment in a Canadian
entity if the entity and one or more other
entities associated with the foreign bank
would, if they were one person, hold a
substantial investment in the Canadian entity.
|
|
| Deemed
control by
foreign bank
|
(5) For the purposes of this Part, a foreign
bank is deemed to control a Canadian entity if
|
|
|
|
(a) the foreign bank and one or more entities
associated with the foreign bank, or
|
|
|
|
(b) two or more entities associated with the
foreign bank
|
|
|
|
would, if they were one person, control the
Canadian entity.
|
|
| Deemed
control by
entity
associated
|
(6) For the purposes of this Part, an entity
associated with a foreign bank is deemed to
control a Canadian entity if the entity and one
or more other entities associated with the
foreign bank would, if they were one person,
control the Canadian entity.
|
|
| Foreign bank
a major owner
|
(7) For the purposes of this Part, a foreign
bank
|
|
|
|
(a) is a major owner of an unincorporated
Canadian entity if the foreign bank, either
alone or together with one or more entities
associated with the foreign bank,
beneficially owns more than 35 per cent of
the ownership interests, however
designated, into which the unincorporated
Canadian entity is divided; and
|
|
|
|
(b) is a major owner of a Canadian body
corporate if the foreign bank, either alone or
together with one or more entities
associated with the foreign bank,
beneficially owns
|
|
|
|
(i) more than 20 per cent of the
outstanding shares of any class of voting
shares of the Canadian body corporate, or
|
|
|
|
(ii) more than 30 per cent of the
outstanding shares of any class of
non-voting shares of the Canadian body
corporate.
|
|
| Entity
associated a
major owner
|
(8) For the purposes of this Part, an entity
associated with a foreign bank
|
|
|
|
(a) is a major owner of an unincorporated
Canadian entity if the entity associated with
the foreign bank, either alone or together
with one or more other entities associated
with the foreign bank, beneficially owns
more than 35 percent of the ownership
interests, however designated, into which
the unincorporated Canadian entity is
divided; and
|
|
|
|
(b) is a major owner of a Canadian body
corporate if the entity associated with the
foreign bank, either alone or together with
one or more other entities associated with
the foreign bank, beneficially owns
|
|
|
|
(i) more than 20 per cent of the
outstanding shares of any class of voting
shares of the Canadian body corporate, or
|
|
|
|
(ii) more than 30 per cent of the
outstanding shares of any class of
non-voting shares of the Canadian body
corporate.
|
|
| Foreign bank
deemed major
owner
|
(9) For the purposes of this Part, a foreign
bank is deemed to be a major owner of a
Canadian entity if
|
|
|
|
(a) the foreign bank is acting in concert in
relation to the Canadian entity with one or
more other persons such that, if they were
one person, they would be a major owner of
the Canadian entity; or
|
|
|
|
(b) two or more persons who are acting in
concert in relation to the Canadian entity
and in relation to the foreign bank would, if
they were one person, control the foreign
bank and be a major owner of the Canadian
entity.
|
|
| Entity
associated
deemed major
owner
|
(10) For the purposes of this Part, an entity
associated with a foreign bank is deemed to be
a major owner of a Canadian entity if it is
acting in concert in relation to the Canadian
entity with one or more other persons such
that, if they were one person, they would be a
major owner of the Canadian entity.
|
|
| Member of
foreign bank's
group
|
(11) For the purposes of this Part, a member
of a foreign bank's group is any of the
following:
|
|
|
|
(a) an entity associated with the foreign
bank;
|
|
|
|
(b) an entity in which the foreign bank or an
entity associated with the foreign bank
holds a substantial investment; and
|
|
|
|
(c) a prescribed entity, in relation to the
foreign bank.
|
|
| Exemption
order of
Minister
|
507.1 (1) The Minister may, by order,
determine that this Part, other than this
section, sections 507 and 517, subsection
520(3) and sections 521, 522, 522.1 and 522.2,
shall not apply to a foreign bank if
|
|
|
|
(a) the foreign bank is not designated under
section 517;
|
|
|
|
(b) the foreign bank is not associated with
a foreign bank designated under section
517;
|
|
|
|
(c) the conditions for designation described
in section 517 are not, in the opinion of the
Minister, met by the foreign bank; and
|
|
|
|
(d) the conditions for designation described
in section 517 are not, in the opinion of the
Minister, met by another foreign bank that
is an entity associated with the foreign
bank.
|
|
| Revocation of
order
|
(2) An order under subsection (1) is deemed
to be revoked if the foreign bank, or another
foreign bank that is an entity associated with
the foreign bank, is designated under section
517; the Minister shall revoke such an order if
the Minister is satisfied that the conditions for
designation described in that section are met
by the foreign bank or by another foreign bank
that is an entity associated with the foreign
bank.
|
|
| Change in
circumstances
|
(3) A foreign bank that is the subject of an
order under subsection (1), or another foreign
bank that is an entity associated with the
foreign bank, shall advise the Minister of any
change in circumstances affecting its
eligibility for designation under section 517.
|
|
| Effect on
associated
entities
|
(4) This Part, other than this section,
sections 507 and 517, subsection 520(3) and
sections 521, 522, 522.1 and 522.2, does not
apply to an entity associated with a foreign
bank that is the subject of an order under
subsection (1).
|
|
| Effect on
non-bank
affiliates
|
(5) Section 514 does not apply to a
non-bank affiliate of a foreign bank that is a
non-bank affiliate of a foreign bank by reason
only of its relation to a foreign bank that is the
subject of an order under subsection (1).
|
|
|
|
|
|
| Prohibited
activities
|
508. (1) A foreign bank or an entity
associated with a foreign bank shall not
|
|
|
|
(a) engage, in Canada, in
|
|
|
|
(i) any activity that a bank is permitted to
engage in, or is prohibited from engaging
in, by or under sections 409 to 418, or
|
|
|
|
(ii) any trade or business;
|
|
|
|
(b) maintain a branch in Canada for any
purpose;
|
|
|
|
(c) establish, maintain or acquire for use in
Canada an automated banking machine, a
remote service unit or a similar automated
service, or accept data from such a machine,
unit or service; or
|
|
|
|
(d) acquire or hold control of, or a
substantial investment in, a Canadian
entity.
|
|
| Guarantee and
acceptance of
securities and
bills
|
(2) Subject to subsection (3), sections 515
and 515.1 and subsections 516(4) and
517.1(3),
|
|
|
|
(a) a foreign bank shall not guarantee any
securities or accept any bills of exchange or
depository bills that are issued by a person
resident in Canada and that are intended by
the issuer or by any party to the security or
bill to be sold or traded in Canada; and
|
|
|
|
(b) no person shall participate in any
arrangement in connection with a guarantee
or acceptance prohibited by paragraph (a).
|
|
| Exception
|
(3) Subsection (2) does not apply in respect
of the guarantee or acceptance by a foreign
bank of securities, bills of exchange or
depository bills that are
|
|
|
|
(a) issued by a non-bank affiliate of the
foreign bank; or
|
|
|
|
(b) issued by any other person resident in
Canada and guaranteed or accepted by
|
|
|
|
(i) a bank that is a subsidiary of the
foreign bank or an entity associated with
the foreign bank,
|
|
|
|
(ii) a Canadian entity referred to in any of
paragraphs 468(1)(a) to (i) in which a
bank that is a subsidiary of the foreign
bank, or of an entity associated with the
foreign bank, holds a substantial
investment,
|
|
|
|
(iii) a Canadian entity referred to in any
of paragraphs 468(1)(a) to (i) that is
controlled by a bank that is a subsidiary
of the foreign bank, or of an entity
associated with the foreign bank,
|
|
|
|
(iv) a Canadian entity referred to in any
of paragraphs 468(1)(b) to (i) that is a
non-bank affiliate of the foreign bank, or
|
|
|
|
|
|
| Accessing
accounts
|
(4) Nothing in paragraphs (1)(a) to (c) shall
be construed as prohibiting a foreign bank, or
an entity associated with a foreign bank, from
entering into any arrangement with one or
more Canadian financial institutions by which
customers of the foreign bank or the entity
who are natural persons not ordinarily resident
in Canada may access in Canada their
accounts located outside Canada through the
use of automated banking machines located in
Canada and operated by the Canadian
financial institution or institutions.
|
|
| Quotations
|
(5) Nothing in paragraph (1)(c) shall be
construed as prohibiting a foreign bank, or an
entity associated with a foreign bank, from
establishing, maintaining or using a private
telephone service or similar facility for the
purpose of quoting to customers in Canada, or
entering with customers in Canada into verbal
agreements relating to, foreign exchange,
deposit or loan rates if there is no accounting
or information processing involved in the
private telephone service or similar facility.
|
|
| Regulations
|
(6) The Governor in Council may make
regulations exempting the undertaking of any
activities that the Governor in Council may
specify from any of the prohibitions set out in
subsection (1) or (2).
|
|
| Transitional
|
(7) Subject to subsection (8), paragraph
(1)(d) does not apply in respect of the holding
of control of, or a substantial investment in, a
Canadian entity whose principal activity in
Canada is an activity referred to in any of
subparagraphs 518(3)(a)(i) to (v), as they read
immediately before the coming into force of
this Part, and that was acquired by a foreign
bank or an entity associated with a foreign
bank prior to August 1, 1997 and before
|
|
|
|
(a) the foreign bank became a foreign bank
or the entity associated with a foreign bank
became an entity associated with a foreign
bank, as the case may be; or
|
|
|
|
(b) the Canadian entity's principal activity
in Canada became an activity described in
those subparagraphs.
|
|
| Restriction
|
(8) Subsection (7) applies only if the foreign
bank or an entity associated with the foreign
bank
|
|
|
|
(a) is not an authorized foreign bank; and
|
|
|
|
(b) does not control, and is not a major
shareholder of, a bank or a bank holding
company.
|
|
| Activity
carried out by
agent, etc.
|
508.1 For the purposes of this Part, a foreign
bank is deemed to have carried out anything
prohibited by section 508 if it is carried out by
|
|
|
|
(a) a nominee or agent of the foreign bank;
|
|
|
|
(b) an entity controlled by the foreign bank;
|
|
|
|
(c) a nominee or agent of an entity
controlled by the foreign bank; or
|
|
|
|
(d) a Canadian entity in which the foreign
bank has a substantial investment.
|
|
| Activity
carried out by
agent, etc.
|
508.2 For the purposes of this Part, an entity
associated with a foreign bank is deemed to
have carried out anything prohibited by
section 508 if it is carried out by
|
|
|
|
(a) a nominee or agent of the entity
associated with the foreign bank;
|
|
|
|
(b) an entity controlled by the entity
associated with the foreign bank;
|
|
|
|
(c) a nominee or agent of an entity
controlled by the entity associated with the
foreign bank; or
|
|
|
|
(d) a Canadian entity in which the entity
associated with a foreign bank has a
substantial investment.
|
|