Bill C-67

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Disqualifi- cation of auditor	586. (1) An auditor that ceases to be qualified under subsection 585(2) shall resign without delay after any member of the firm of accountants becomes aware that the firm has ceased to be qualified.
Disqualifi- cation order	(2) Any interested person may apply to a court for an order declaring that an authorized foreign bank's auditor has ceased to be qualified under subsection 585(2) and declaring the office of auditor to be vacant.
Revocation of appointment	587. (1) An authorized foreign bank may at any time revoke the appointment of its auditor.
Revocation by Superinten- dent	(2) The Superintendent may at any time revoke the appointment of an auditor made under subsection 585(1) or 589(1) by notice in writing signed by the Superintendent and sent by registered mail to the auditor and to the principal officer of the authorized foreign bank addressed to the usual place of business of the auditor and to the principal office of the authorized foreign bank, respectively.
Ceasing to hold office	588. (1) An auditor ceases to hold office when
	(a) the auditor resigns; or
	(b) the appointment of the auditor is revoked by the authorized foreign bank or the Superintendent.
Effective date of resignation	(2) The resignation of an auditor becomes effective at the time a written resignation is sent to the authorized foreign bank or at the time specified in the resignation, whichever is later.
Filling vacancy	589. (1) Where a vacancy occurs in the office of auditor of an authorized foreign bank under any of sections 585 to 588, the authorized foreign bank shall without delay fill the vacancy and, where it fails to do so, the Superintendent may fill the vacancy.
Designation of member of firm	(2) Where the Superintendent has appointed a firm of accountants to fill a vacancy, the Superintendent shall designate the member of the firm who is to conduct the audit on behalf of the firm.
Statement of auditor	590. An auditor of an authorized foreign bank who
	(a) resigns, or
	(b) receives a notice or otherwise learns that another person is to be appointed in the auditor's stead, whether because of the auditor's resignation or revocation of appointment or because the auditor's term of office has expired or is about to expire,
	shall submit to the principal officer of the authorized foreign bank and the Superintendent a written statement giving the reasons for the resignation or the reasons why the auditor opposes any proposed action.
Duty of replacement auditor	591. (1) Where an auditor of an authorized foreign bank has resigned or the appointment of an auditor has been revoked, no firm of accountants shall accept an appointment or consent to be appointed as auditor of the authorized foreign bank until the firm has requested and received from the other auditor a written statement of the circumstances and reasons why the other auditor resigned or why, in the other auditor's opinion, the other auditor's appointment was revoked.
Exception	(2) Notwithstanding subsection (1), a firm of accountants may accept an appointment or consent to be appointed as auditor of an authorized foreign bank if, within fifteen days after a request under that subsection is made, no reply from the other auditor is received.
Effect of non- compliance	(3) Unless subsection (2) applies, an appointment as auditor of an authorized foreign bank is void if subsection (1) has not been complied with.
	Examinations and Reports
Examination of annual return	592. (1) The auditor of an authorized foreign bank shall make any examination that the auditor considers necessary to enable the auditor to report on the annual return.
Auditing standards	(2) The auditor's examination shall, except as otherwise specified by the Superintendent, be conducted in accordance with the auditing standards referred to in subsection 323(2).
Filing	(3) The auditor's report shall be filed with the Superintendent within five months after the end of the financial year of the authorized foreign bank.
Report to Superinten- dent and extended examination	(4) The Superintendent may, in writing, require that an authorized foreign bank's auditor report to the Superintendent on the extent of the auditor's procedures in the examination of the authorized foreign bank's annual return and may, in writing, require that the auditor enlarge or extend the scope of that examination or direct that any other particular procedure be performed in any particular case, and the auditor shall comply with any requirement of the Superintendent and report to the Superintendent on it.
Special examination	(5) The Superintendent may, in writing, require that the auditor of the authorized foreign bank make a particular examination relating to the adequacy of the procedures adopted by the authorized foreign bank in respect of its business in Canada for the safety of its depositors and creditors, or any other examination that, in the Superintendent's opinion, the public interest may require, and report to the Superintendent on it.
Special audit	(6) The Superintendent may direct that a special audit or report be made if, in the opinion of the Superintendent, it is so required and may appoint for that purpose a firm of accountants qualified under subsection 585(2) to be the auditor.
Expenses payable by authorized foreign bank	(7) The expenses entailed by any examination, audit or report referred to in any of subsections (4) to (6) are payable by the authorized foreign bank on being approved in writing by the Superintendent.
Right to information	593. (1) On the request of the auditor of an authorized foreign bank, the present or former principal officers, directors, officers, employees or representatives of the authorized foreign bank shall, to the extent that they are reasonably able to do so,
	(a) permit access to any records, assets and security held by the authorized foreign bank, or any entity in which the authorized foreign bank has a substantial investment under Part XII, and
	(b) provide any information and explanations
	that are, in the opinion of the auditor, necessary to enable the auditor to perform the duties of auditor of the authorized foreign bank.
No civil liability	(2) A person who in good faith makes an oral or written communication under subsection (1) shall not be liable in any civil action arising from having made the communication.
Auditor's report to principal officer	594. (1) The auditor of an authorized foreign bank shall make a report to the principal officer of the authorized foreign bank in writing on the annual return not later than sixty days after the end of the financial year in respect of which the annual return is prepared.
Auditor's opinion	(2) In the report, the auditor shall state whether, in the auditor's opinion, the annual return presents fairly, in accordance with the accounting principles referred to in subsection 308(4), the financial position of the business in Canada of the authorized foreign bank as at the end of the financial year to which it relates and the results of the operations and changes in the financial position of the business in Canada of the authorized foreign bank for that financial year.
Auditor's remarks	(3) In the report, the auditor shall include any remarks that the auditor considers necessary when
	(a) the examination has not been made in accordance with the auditing standards referred to in subsection 592(2);
	(b) the annual return has not been prepared on a basis consistent with that of the preceding financial year; or
	(c) the annual return does not present fairly, in accordance with the accounting principles referred to in subsection 308(4), the financial position of the business in Canada of the authorized foreign bank as at the end of the financial year to which it relates or the results of the operations or changes in the financial position of the authorized foreign bank for that financial year.
Additional reports to principal officer	595. (1) It is the duty of the auditor of an authorized foreign bank to report in writing to the principal officer of the authorized foreign bank any transactions or conditions in respect of the business in Canada of the authorized foreign bank that have come to the auditor's attention affecting the well-being of the authorized foreign bank that in the auditor's opinion are not satisfactory and require rectification and, without restricting the generality of the foregoing, the auditor shall, as occasion requires, make a report to the principal officer in respect of transactions in respect of the business in Canada of the authorized foreign bank that have come to the auditor's attention and that in the auditor's opinion have not been within the powers of the authorized foreign bank.
Transmission of report	(2) The auditor shall, at the time of transmitting the report to the principal officer, provide the Superintendent with a copy of it.
Qualified privilege for statements	596. Any oral or written statement or report made under this Act by the auditor or a former auditor of an authorized foreign bank has qualified privilege.
	Records
Records	597. (1) An authorized foreign bank shall prepare and maintain
	(a) records containing copies of all orders of the Minister or the Superintendent in relation to the authorized foreign bank;
	(b) original accounting records respecting its business in Canada;
	(c) with respect to its business in Canada, records showing, for each of its customers, on a daily basis, particulars of the transactions with that customer and the balance owing to or by the authorized foreign bank in respect of that customer;
	(d) records containing information set out in Schedule III, as that information exists from time to time, in relation to the authorized foreign bank; and
	(e) records containing the name, address and date of appointment of the authorized foreign bank's auditor.
Place of records	(2) The records described in subsection (1) shall be kept at the principal office of the authorized foreign bank or at any other place in Canada that its principal officer thinks fit.
Notice of place of records	(3) Where any of the records described in subsection (1) are not kept at the principal office of an authorized foreign bank, the authorized foreign bank shall notify the Superintendent of the place where they are kept.
Form of records	(4) Records required by this Act to be prepared and maintained by an authorized foreign bank
	(a) may be in a bound or loose-leaf form or in a photographic film form; or
	(b) may be entered or recorded by any system of mechanical or electronic data processing or any other information storage device that is capable of reproducing any required information in intelligible written form within a reasonable time.
Conversion of records	(5) Records kept in one form may be converted to any other form and, notwithstanding section 246, an authorized foreign bank may destroy the record at any time after it has been converted.
Access to records	(6) Creditors in respect of the business in Canada of an authorized foreign bank and their personal representatives may examine a record referred to in any of paragraphs (1)(a), (d) or (e) during the usual business hours of the authorized foreign bank, and may take extracts from it, free of charge, or have copies made of it on payment of a reasonable fee.
Application of sections 244 to 247	598. Section 244, subsections 245(1), (2) and (4) to (7) and sections 246 and 247 apply, with any modifications that the circumstances require, to an authorized foreign bank as if
	(a) the reference in subsection 245(1) to ``records referred to in section 238'' were a reference to ``records referred to in section 597''; and
	(b) the reference in subsection 246(1) to ``records of the bank referred to in subsection 238(1)'' were a reference to ``records of the authorized foreign bank referred to in subsection 597(1)''.
	Termination of Business in Canada
Release of assets in Canada	599. (1) An authorized foreign bank that discontinues its business in Canada may apply in writing to the Superintendent for the release of its assets maintained on deposit under paragraph 534(3)(a) or subsection 582(1).
Conditions of release	(2) Except as otherwise provided in this Act, the assets may not be released unless
	(a) the authorized foreign bank discharges, provides for the discharge of, or transfers, all its liabilities in respect of its business in Canada to a bank, to another authorized foreign bank in respect of its business in Canada or to a body corporate to which the Trust and Loan Companies Act applies; and
	(b) the authorized foreign bank provides the Superintendent with proof of the publication, for four consecutive weeks, in at least one newspaper of general circulation at or near the place where the principal office of the authorized foreign bank is situated and the Canada Gazette of a notice that it will apply to the Superintendent for the release of its assets on a day specified in the notice, which must be at least six weeks after the date of the notice, and calling on any of its depositors or creditors opposing that release to file their opposition with the Superintendent on or before the day.
Superinten- dent may release assets	(3) After the day specified in the notice, the Superintendent may authorize the release of the assets if the Superintendent is satisfied that the authorized foreign bank has discharged, provided for the discharge of, or transferred, all of its liabilities in respect of its business in Canada.
Release of assets to liquidator	(4) Notwithstanding subsections (1) to (3), the assets on deposit of an authorized foreign bank that is in liquidation may, on the order of any court having jurisdiction under the Winding-up and Restructuring Act, be released to the liquidator.
Order deemed to be revoked	(5) An order made under subsection 524(1), 528(1) or 534(1) in respect of an authorized foreign bank is deemed to be revoked when the Superintendent authorizes the release of the assets of the authorized foreign bank under subsection (3).
	Supervision
	Returns
Required information	600. An authorized foreign bank shall provide the Superintendent with any information, at the times and in the form, that the Superintendent may require.
Annual return	601. (1) An authorized foreign bank, in respect of its business in Canada, shall prepare annually a return of the condition and affairs of the authorized foreign bank as at the end of each financial year, showing its assets and liabilities and its income and expenditures during that financial year together with any other information that the Superintendent considers appropriate.
Form and filing of annual return	(2) The annual return shall be in the form that the Superintendent determines and shall be filed with the Superintendent on or before sixty days after the end of the financial year in respect of which it is prepared.
Accounting principles	(3) The annual return shall be prepared in accordance with the accounting principles referred to in subsection 308(4).
Report of unclaimed deposits	602. (1) An authorized foreign bank shall, within sixty days after the end of each calendar year, provide the Superintendent with a return, in the form that the Superintendent may determine, as of the end of that calendar year, in respect of all deposits made with it in Canada in Canadian currency for which no transaction has taken place and no statement of account has been requested or acknowledged by the depositors during a period of nine years or more.
Period	(2) The period referred to in subsection (1) shall be calculated
	(a) in the case of a deposit made for a fixed period, from the day on which the fixed period terminated until the date of the return; and
	(b) in the case of any other deposit, from the day on which the last transaction took place or a statement of account was last requested or acknowledged by the depositor, whichever is later, until the date of the return.
Content of return	(3) The return shall show, in so far as is known to the authorized foreign bank,
	(a) the name of each depositor in whose name each deposit is held;
	(b) the recorded address of each of those depositors;
	(c) the outstanding amount of each deposit; and
	(d) the branch of the authorized foreign bank at which the last transaction took place in respect of the deposit, and the date of the transaction.
Amounts under one hundred dollars	(4) Where the total outstanding amount of deposits in the name of a depositor is less than one hundred dollars, the authorized foreign bank may omit from the return the particulars in respect of the deposits required by subsection (3).
Return on unclaimed bills of exchange	603. (1) An authorized foreign bank shall, within sixty days after the end of each calendar year, provide the Superintendent with a return, in the form that the Superintendent may determine, as of the end of that calendar year, in respect of all negotiable instruments (including instruments drawn by one branch of the authorized foreign bank on another of its branches but not including instruments issued in payment of a dividend on the capital of the authorized foreign bank) payable in Canada in Canadian currency that have been issued, certified or accepted by the authorized foreign bank at branches of the authorized foreign bank and for which no payment has been made for a period of nine years or more calculated from the date of issue, certification, acceptance or maturity, whichever is the latest, until the date of the return.

Bill C-67

Records

Termination of Business in Canada

Supervision