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Bill C-28

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42-43 ELIZABETH II

CHAPTER 28

An Act respecting the making of loans and the provision of other forms of financial assistance to students, to amend and provide for the repeal of the Canada Student Loans Act, and to amend one other Act in consequence thereof

[Assented to 23rd June, 1994]

      Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

SHORT TITLE

Short title

1. This Act may be cited as the Canada Student Financial Assistance Act.

INTERPRETATION

Definitions

2. (1) In this Act,

``appropriate authority''
« autorité compétente »

``appropriate authority'', in respect of a province, means an appropriate authority designated for the province pursuant to subsection 3(1);

``designated educational institution''
« établisseme nt agréé »

``designated educational institution'' means an institution of learning designated pursuant to subsection 3(1), and includes a specified educational institution within the meaning of the Canada Student Loans Act;

``lender''
« prêteur »

``lender'' means a financial institution within the meaning of the Bank Act or other corporation that is a party to an agreement with the Minister entered into under section 5;

``Minister''
« ministre »

``Minister'' means such member of the Queen's Privy Council for Canada as may be designated by the Governor in Council as the Minister for the purposes of this Act;

``prescribed''
Version anglaise seulement

``prescribed'', in the case of a form or the information to be given on a form, means prescribed by the Minister and, in any other case, means prescribed by the regulations;

``qualifying student''
« étudiant admissible »

``qualifying student'' means a person

      (a) who is a Canadian citizen or a permanent resident within the meaning of the Immigration Act,

      (b) who is qualified for enrolment or is enrolled at a designated educational institution as a full-time student or part-time student for a period of studies at a post-secondary school level, and

      (c) who intends to attend a designated educational institution as a full-time student or part-time student for a period of studies described in paragraph (b) if it is financially possible for that person to do so.

Other definitions

(2) In this Act, the words and expressions ``borrower'', ``consolidated student loan agreement'', ``course'', ``family income'', ``financial assistance'', ``full-time student'', ``loan year'', ``part-time student'', ``period of studies'', ``permanent disability'', ``post-secondary school level'', ``program of studies'', ``student loan'' and ``student loan agreement'' have the meanings assigned by the regulations.

Words and expressions in relation to previous loan years

(3) Words and expressions used in this Act have, when used in respect of a loan year before the loan year in which this section comes into force, the meanings assigned to them by the Canada Student Loans Act.

APPROPRIATE AUTHORITIES

Designation of appropriate authorities

3. (1) For the purposes of this Act, the Minister may, by order, designate for a province

    (a) an appropriate authority, which authority may designate as designated educational institutions any institutions of learning in Canada that offer courses at a post-secondary school level, or any class of such institutions; and

    (b) an appropriate authority, which authority may designate as designated educational institutions any institutions of learning outside Canada that offer courses at a post-secondary school level, or any class of such institutions.

Revocations and exclusions

(2) An appropriate authority may revoke any designation made by it under subsection (1), and any designation made in respect of the province under the Canada Student Loans Act and, in the case of a designation of a class, may exclude any named institution from that designation.

Agreements

4. (1) The Minister may enter into an agreement with an appropriate authority, or with an appropriate authority and the government of the province for which the authority was designated, respecting the exercise or performance of any of the authority's powers, duties or functions under this Act or the regulations.

Directives

(2) The Minister may give directives to any appropriate authority respecting the exercise or performance of any of its powers, duties or functions under this Act or the regulations, and such directives are binding on the appropriate authority.

Statutory Instruments Act

(3) The Statutory Instruments Act does not apply in respect of directives given under subsection (2).

AGREEMENTS WITH LENDERS

Agreements

5. The Minister may, if the Minister considers it appropriate, with the concurrence of the Minister of Finance, enter into an agreement with any lender respecting the making of student loans or the provision of other forms of financial assistance to students by the lender, and such an agreement may, without limiting the generality of the foregoing, provide for

    (a) the payment by the Minister to the lender of all or a portion of

      (i) amounts equivalent to interest on a student loan made by the lender in respect of the period for which no interest is payable by the borrower pursuant to subsection 7(1),

      (ii) amounts equivalent to interest on a student loan made by the lender in respect of any period for which no interest is payable by the borrower pursuant to regulations made under paragraph 15(n),

      (iii) principal and interest on a student loan made by the lender to a borrower against whom the rights of the lender are terminated by section 10 or 11,

      (iv) amounts in respect of a student loan made by the lender that are paid under regulations made under paragraph 15(l),

      (v) a risk premium for lending risks on a student loan made by the lender,

      (vi) amounts necessary for the purchase of a student loan made by the lender that is payable and on which no payment has been made by the borrower in at least one year, and a percentage of amounts recovered by the Minister in respect of that loan,

      (vii) adjusted amounts in respect of principal and interest on a student loan, where an inadvertent error concerning the rate of interest or the amount to be repaid is made by the lender in drawing up the consolidated student loan agreement or the student loan agreement,

      (viii) amounts in respect of the loss suffered by the lender on a student loan made to a full-time student who, before the month following the month in which the borrower ceases to be a full-time student,

        (A) makes an assignment under the Bankruptcy and Insolvency Act that is filed and not cancelled, is deemed under that Act, by reason of circumstances occurring before that following month, to have made an assignment, or is the subject of a receiving order made under that Act,

        (B) makes a proposal under Division I or II of Part III of that Act that is approved or deemed to be approved by a court under that Act,

        (C) is granted a consolidation order under Part X of that Act, or

        (D) is granted relief under a provincial law relating to the orderly payment of debts, and

      (ix) any other amounts that the Minister considers appropriate in respect of a student loan made, or other financial assistance provided, by the lender;

    (b) audits and adjustments in respect of payments made to the lender by the Minister;

    (c) subject to the regulations, the circumstances in which the lender is, on application, required to provide financial assistance to a qualifying student in an amount not exceeding the maximum amount determined in accordance with section 12;

    (d) the manner of calculating the interest payable by a borrower to the lender on a student loan made by the lender, including the amount on which interest is to be calculated and the rate of interest or the manner of determining the rate of interest;

    (e) the repayment of student loans by borrowers on an income-contingent basis;

    (f) the provisions to be included in an agreement between a borrower and the lender relating to a student loan, the making of amendments to the agreement, and the conditions and consequences of making an amendment;

    (g) the procedures to be followed by the lender in making, collecting or otherwise dealing with a student loan;

    (h) the making of reports to the Minister respecting student loans; and

    (i) the terms and conditions respecting the obligations of the Minister and the lender under the agreement.

Payments in accordance with agreement

6. Subject to this Act and the regulations, the Minister shall pay to a lender, in accordance with any agreement entered into under section 5, any amount that is payable by the Minister to the lender under the agreement.

INTEREST-FREE AND DEFERRAL PERIODS

Interest-free period for full-time students

7. (1) Subject to the regulations, no interest is payable by a borrower on a student loan prescribed by regulations made under paragraph 15(j) in respect of any period of studies during which the borrower is a full-time student, or in respect of any subsequent period ending on the last day of the month in which the borrower ceases to be a full-time student.

No fees

(2) No fee of any kind may be charged to a borrower on a student loan in respect of any period of studies, or a subsequent period, referred to in subsection (1).

Payment deferred for full-time students

8. Subject to the regulations, no amount on account of principal or interest in respect of a student loan prescribed by regulations made under paragraph 15(j) that is made to a full-time student is required to be paid by the borrower until the last day of the seventh month after the month in which the borrower ceases to be a full-time student.

Special interest-free or interest-reduc ed period

9. Where a special interest-free or interest-reduced period is granted to a borrower under regulations made under paragraph 15(n), no amount on account of the principal is required to be paid by the borrower during that period, but, in the case of an interest-reduced period, the borrower may be liable to pay, during that period, a portion of the interest in respect of that period.

DEATH OR DISABILITY OF BORROWER

Death of borrower

10. All rights of the lender against a borrower in respect of a student loan prescribed by regulations made under paragraph 15(j) to a full-time student terminate if the borrower dies before the month following the month in which the borrower would have otherwise ceased to be a full-time student, and in that event the Minister shall pay to the lender the amounts referred to in subparagraph 5(a)(iii).

Permanent disability of borrower

11. (1) All rights of the lender against a borrower in respect of a student loan prescribed by regulations made under paragraph 15(j) terminate if the Minister is satisfied, on the basis of information specified by the Minister and provided to the Minister by or on behalf of the borrower, that the borrower, by reason of the borrower's permanent disability, is or will be unable to repay the student loan without exceptional hardship, taking into account the borrower's family income, and in that event the Minister shall pay to the lender the amounts referred to in subparagraph 5(a)(iii).

Time of disability

(2) For the purposes of subsection (1), the permanent disability must occur

    (a) in the case of a full-time student, before the first day of the seventh month after the month in which the borrower ceases to be a full-time student; and

    (b) in the case of a part-time student, before the day on which the lender and the borrower enter into the student loan agreement.

CERTIFICATES OF ELIGIBILITY

Issue of certificates

12. (1) Subject to the regulations, the appropriate authority for a province designated under paragraph 3(1)(a) may, on application, issue or cause to be issued a certificate of eligibility in the prescribed form, for a period of studies at a designated educational institution in Canada or outside Canada, to a qualifying student whom that authority considers

    (a) to have attained a satisfactory scholastic standard; and

    (b) to be in need of financial assistance.

Amount needed

(2) Where the appropriate authority considers that a qualifying student meets the criteria set out in paragraphs (1)(a) and (b), it shall determine the amount the student needs, taking into consideration

    (a) the program of studies in which the qualifying student is registered;

    (b) the cost of books and other course-related supplies; and

    (c) whether the qualifying student is enrolled in an institution outside the province of residence of the student.

Contents

(3) A certificate of eligibility must set out the social insurance number of the qualifying student and the maximum amount of the financial assistance that may be given to the student.

*ep

Maximum amount for certain full-time students

(4) In the case of a full-time student, the maximum amount, for a province, of a student loan prescribed by regulations made under paragraph 15(j), and in respect of which a certificate of eligibility is issued, is the lesser of

    (a) the amount prescribed for that province, and

    (b) the product obtained by multiplying

      (i) the amount determined under subsection (2) for the student

    by

      (ii) the percentage prescribed for that province.

Escalator

(5) The amount referred to in paragraph (4)(a) may be adjusted annually by an escalator determined in accordance with the prescribed formula.

Maximum amount for part-time students

(6) In the case of a part-time student, the maximum amount, for a province, of a student loan in respect of which a certificate of eligibility is issued is the prescribed amount.

Maximum amount

(7) The maximum amount of financial assistance in respect of which a certificate of eligibility is issued, other than a loan to which subsection (4) or (6) applies, is the prescribed amount, or the amount calculated in accordance with the prescribed formulas.

Idem

(8) The maximum amount of financial assistance in respect of which a certificate of eligibility is not required is the prescribed amount, or the amount calculated in accordance with the prescribed formulas.

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