Bill C-82

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	84. (1) The portion of subsection 521(1) of the Act before subparagraph (b)(i) is replaced by the following:
Consent required	521. (1) Unless the consent of the Governor in Council, by order, is obtained, a foreign bank shall not directly or indirectly
	(a) establish a new Canadian business, within the meaning of the Investment Canada Act, whose principal activity in Canada is an activity referred to in any of subparagraphs 518(3)(a)(i) to (v);
	(b) acquire shares of or ownership interests in a Canadian entity whose principal activity in Canada is an activity referred to in any of subparagraphs 518(3)(a)(i) to (v) in such number
	(2) Subsection 521(1) of the Act is amended by striking out the word ``or'' at the end of paragraph (b), by adding the word ``or'' at the end of paragraph (c) and by adding the following after paragraph (c):
	(d) hold shares of or ownership interests in a Canadian entity whose principal activity in Canada is an activity referred to in any of subparagraphs 518(3)(a)(i) to (v) in such number that the Canadian entity is a non-bank affiliate of the foreign bank, if those shares or ownership interests were acquired by the foreign bank
	(i) before the foreign bank became a foreign bank or when the Canadian entity's principal activity in Canada was not an activity described in one of those subparagraphs, and
	(ii) after the coming into force of this paragraph.
	(3) Subsection 521(2) of the Act is replaced by the following:
Activity carried out by agent	(1.01) Without limiting the generality of subsection (1), where an activity prohibited by that subsection is carried out by a nominee or agent of a foreign bank or by an entity that is controlled by a foreign bank, the foreign bank is deemed to have indirectly carried out the activity.
Terms and conditions	(1.02) The consent of the Governor in Council under subsection (1) may be subject to such terms and conditions as the Governor in Council may impose in the order.
Where further consent not required	(1.03) Subject to subsections (1.04) and (1.05), after a foreign bank obtains consent under subsection (1) to do something described in any of paragraphs (1)(a) to (d), the foreign bank may do anything described in any of those paragraphs without seeking further consent under that subsection. This subsection applies for the purpose of determining what a foreign bank may do after the coming into force of this subsection even if the consent under subsection (1) was obtained before that coming into force.
Exception	(1.04) Subsection (1.03) does not apply to allow a foreign bank, without consent under subsection (1), to acquire or hold a substantial investment in an entity described in any of paragraphs (b) to (g) of the definition ``financial institution'' in section 2.
Further exception	(1.05) Subsection (1.03) does not apply to a foreign bank designated in an order that was made under subsection (1.06) and that has not been revoked under subsection (1.08).
Designation order	(1.06) The Minister may, by order, designate a foreign bank as a foreign bank to which subsection (1.03) does not apply. That order may be subject to any terms and conditions that the Minister considers appropriate.
Where order may be made	(1.07) That order may be made only if
	(a) the Minister is of the opinion, after consulting with the Superintendent, that
	(i) the foreign bank's principal activity is the provision of services that would be permitted by this Act if they were provided by a bank in Canada, and
	(ii) the foreign bank is regulated as a bank in the country under whose laws it was incorporated or in any country in which it carries on business; or
	(b) the foreign bank is affiliated with a foreign bank to which paragraph (a) applies.
Revocation or variation of order	(1.08) The Minister may, by further order, revoke or vary an order under subsection (1.06).
Effective date	(1.09) The revocation or variation comes into effect three months after the day the further order is made, except that if the Minister and the foreign bank to which the order relates agree that the revocation or variation is to take effect at some other time, the revocation or variation takes effect at that other time.
Publication	(1.1) Where the Minister makes an order under subsection (1.06) or (1.08), the Minister shall publish in the Canada Gazette a notice of the making of the order.
Exception to consent requirement	(2) Subsection (1) does not apply where a foreign bank holds a substantial investment in a Canadian entity only because a substantial investment in the Canadian entity is held
	(a) as permitted by Part IX, by a foreign bank subsidiary of the foreign bank;
	(b) as permitted by Part IX of the Trust and Loan Companies Act, by a trust or loan company incorporated under that Act that is a subsidiary of the foreign bank; or
	(c) as permitted by Part IX of the Insurance Companies Act, by an insurance company incorporated under that Act that is a subsidiary of the foreign bank.
Publication	(3) Where the Governor in Council makes an order under subsection (1), the Minister shall publish in the Canada Gazette a notice of the making of the order.
	85. Paragraph 522(d) of the Act is replaced by the following:
	(d) the acquisition or holding by a foreign bank of all or substantially all of the assets of a Canadian entity whose principal activity in Canada is an activity referred to in any of subparagraphs 518(3)(a)(i) to (v).
	86. Subsection 523(2) of the Act is repealed.
	87. Paragraph 531(2)(a) of the Act is replaced by the following:
	(a) to any government agency or body that regulates or supervises financial institutions, for purposes related to that regulation or supervision,
	(a.01) to any other agency or body that regulates or supervises financial institutions, for purposes related to that regulation or supervision,
1996, c. 6, s. 15	88. (1) Paragraph 538(1)(a) of the Act is replaced by the following
	(a) take control, for a period not exceeding sixteen days, of the assets of the bank and the assets under its administration; or
1996, c. 6, s. 15	(2) Subparagraph 538(1)(b)(i) of the English version of the Act is replaced by the following:
	(i) take control, for a period exceeding sixteen days, of the assets of the bank and the assets under its administration,
1996, c. 6, s. 15	(3) Paragraph 538(1.1)(b) of the Act is replaced by the following:
	(b) in the opinion of the Superintendent, a practice or state of affairs exists in respect of the bank that may be materially prejudicial to the interests of the bank's depositors or creditors or the owners of any assets under the bank's administration;
1996, c. 6, s. 15	(4) Paragraph 538(1.1)(d) of the Act is replaced by the following:
	(d) any asset appearing on the books or records of the bank or held under its administration is not, in the opinion of the Superintendent, satisfactorily accounted for;
	89. The Act is amended by adding the following after section 555:
Alternative means of publication	555.1 (1) Anything that is required by a provision of this Act to be published in the Canada Gazette or to be published in any other way may, instead of being published in that way, be published in any manner that may be prescribed for the purpose of that provision.
Alternative means of publishing summaries	(2) Anything that is required by a provision of this Act to be summarized in a publication may instead be summarized and published in any manner that may be prescribed for the purpose of that provision.
Publication conditions	(3) Any condition under a provision of this Act that something be published in the Canada Gazette or in any other way is satisfied if that thing is published instead in any manner that may be prescribed for the purpose of that provision.
Other consequences	(4) Where a provision of this Act provides for consequences to follow the publication of something in the Canada Gazette or in any other manner, the same consequences follow the publication of that thing in any other manner that may be prescribed for the purpose of that provision.
	90. Section 559 of the Act is amended by adding the following after paragraph (a):
	(a.1) prescribing the way in which anything that is required or authorized by this Act to be prescribed shall be determined;
	91. (1) Paragraph 565(1)(b) of the Act is replaced by the following:
	(b) in any document giving or purporting to give security on property to a bank under section 426 or 427,
	(2) The portion of subsection 565(2) of the Act before paragraph (a) is replaced by the following:
Wilfully disposing of or withholding goods covered by security	(2) Every person who, having possession or control of property mentioned in or covered by any warehouse receipt, bill of lading or any security given to a bank under section 426 or 427, and having knowledge of the receipt, bill of lading or security, without the consent of the bank in writing before the loan, advance, debt or liability thereby secured has been fully paid
	(3) Paragraph 565(3)(b) of the Act is replaced by the following:
	(b) any security on property given to a bank under section 426 or 427,
	(4) The portion of subsection 565(4) of the Act before paragraph (a) is replaced by the following:
Acquisition of warehouse receipts, bills of lading, etc.	(4) Every bank that acquires or holds any warehouse receipt or bill of lading or any document signed and delivered to the bank giving or purporting to give to the bank security on property under section 426 or 427, to secure the payment of any debt, liability, loan or advance, is guilty of an offence unless
	(5) Paragraph 565(4)(b) of the Act is replaced by the following:
	(b) the debt, liability, loan or advance was contracted or made on the written promise or agreement that a warehouse receipt, bill of lading or security under section 426 or 427 would be given to the bank; or
	92. Paragraphs 566(1)(a) and (b) of the Act are replaced by the following:

	(a) in the case of a natural person, liable
	(i) on summary conviction, to a fine not exceeding $100,000 or to imprisonment for a term not exceeding twelve months, or to both, or
	(ii) on conviction on indictment, to a fine not exceeding $500,000 or to imprisonment for a term not exceeding five years, or to both; and
	(b) in the case of an entity, liable
	(i) on summary conviction, to a fine not exceeding $500,000, or
	(ii) on conviction on indictment, to a fine not exceeding $5,000,000.
	93. Section 567 of the Act is replaced by the following:
Liability of officers, directors, etc.	567. Where an entity commits an offence under this Act, any officer, director or agent of the entity who directed, authorized, assented to, acquiesced in or participated in the commission of the offence is a party to and guilty of the offence and liable on summary conviction or on conviction on indictment to the punishment provided under paragraph 566(1)(a) for the offence, whether or not the entity has been prosecuted or convicted.
R.S., c. B-2	BANK OF CANADA ACT
	*94. Paragraph 6(4)(d) of the Bank of Canada Act* is replaced by the following:**
	(d) except as authorized by or under any Act of Parliament, is a director, partner, officer, employee or shareholder of an institution referred to in any of paragraphs 10(2)(a) to (e); or
	95. (1) Subsection 10(1) of the English version of the Act is replaced by the following:
Selection of directors	10. (1) The directors shall be selected from various occupations.
	(2) The portion of subsection 10(2) of the Act before paragraph (a) is replaced by the following:
Ineligible persons	(2) No person is eligible for appointment as a director if that person is a director, partner, officer or employee of any of the following institutions:
	(3) Subsection 10(2) of the Act is amended by adding the following after paragraph (a):
	(b) a clearing house or participant, as defined in section 2 of the Payment Clearing and Settlement Act;
	(4) Subsection 10(2) of the Act is amended by striking out the word ``or'' at the end of paragraph (c), by adding the word ``or'' at the end of paragraph (d) and by adding the following after paragraph (d):
	(e) an institution that controls, or is controlled by, an institution referred to in any of paragraphs (a) to (d).
	(5) Subsection 10(3) of the Act is replaced by the following:
Control	(2.1) For the purpose of paragraph (2)(e),
	(a) an institution controls a body corporate if securities of the body corporate to which are attached more than fifty per cent of the votes that may be cast to elect directors of the body corporate are beneficially owned by the institution and the votes attached to those securities are sufficient, if exercised, to elect a majority of the directors of the body corporate;
	(b) an institution controls a trust, fund or partnership (other than a limited partnership) or an unincorporated association or organization, if more than fifty per cent of the ownership interests, however designated, into which the trust, fund, partnership, association or organization is divided are beneficially owned by the institution and the institution is able to direct the business and affairs of the trust, fund, partnership, association or organization; and
	(c) the general partner of a limited partnership controls the limited partnership.
Restriction on share ownership	(3) Any person who beneficially owns a share in an institution referred to in any of paragraphs (2)(a) to (e) at the time of being appointed director of the Bank shall dispose of that beneficial ownership interest within three months after the appointment. A director of the Bank shall not otherwise beneficially own a share of an institution referred to in any of those paragraphs.
	96. Subsections 15(1) and (2) of the English version of the Act are replaced by the following:
Officers and employees	15. (1) Such officers and employees may be employed as in the opinion of the Executive Committee may be necessary.
Pension fund	(2) The Board may by by-law establish a pension fund for the officers and employees of the Bank and their dependants and may contribute to it out of the funds of the Bank. The pension fund shall be invested in such manner as may be provided by the by-laws of the Bank.
	97. Section 16 of the Act is replaced by the following:

Bill C-82

BANK OF CANADA ACT