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Bill C-38

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First Reading

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	Appeals
Appeal to Federal Court	977. (1) An appeal lies to the Federal Court from any direction of the Minister made under subsection 402(1) or 915(1) .
Powers	(2) The Federal Court may, in an appeal under subsection (1),
	(a) dismiss the appeal;
	(b) set aside the direction or decision; or
	(c) set aside the direction or decision and refer the matter back for re-determination.
Certificate	(3) For the purposes of an appeal under subsection (1), the Minister shall, at the request of the bank, bank holding company or person making the appeal, provide the bank, bank holding company or person with a certificate in writing setting out the direction or decision appealed from and the reasons why the direction or decision was made.
	Regulations
Power to make regulations	978. The Governor in Council may make regulations
	(a) prescribing anything that is required or authorized by this Act to be prescribed;
	(b) prescribing the way in which anything that is required or authorized by this Act to be prescribed is to be determined;
	(c) respecting the determination of the equity of a bank or a bank holding company;
	(d) defining words and expressions to be defined for the purposes of this Act;
	(e) requiring the payment of a fee in respect of the filing, examining or issuing of any document or in respect of any action that the Superintendent is required or authorized to take under this Act, and fixing the amount of the fee or the manner of determining its amount;
	(f) respecting the regulatory capital and total assets of a bank or a bank holding company ;
	(g) respecting the retention, in Canada, of assets of a bank or a bank holding company ;
	(h) respecting the value of assets of a bank or a bank holding company to be held in Canada and the manner in which those assets are to be held;
	(i) respecting the protection and maintenance of assets of a bank or a bank holding company , including regulations respecting the bonding of directors, officers and employees of a bank or a bank holding company ;
	(j) respecting the holding of shares and ownership interests for the purposes of sections 70, 74 and 714 ;
	(k) respecting information, in addition to the information required by section 634 or 953 , to be maintained in the register referred to in that section; and
	(l) generally for carrying out the purposes and provisions of this Act.
	Delegation
Delegation	979. The Minister may delegate any of the Minister's powers, duties and functions under this Act to any Minister of State appointed under the Ministries and Ministers of State Act to assist the Minister.
	PART XVII
	SANCTIONS
Offence	980. Every person who, without reasonable cause, contravenes any provision of this Act or the regulations is guilty of an offence.
Undue preference to creditor	981. Every director, officer or employee of a bank or an authorized foreign bank who wilfully gives or concurs in giving to any creditor of the bank or authorized foreign bank any fraudulent, undue or unfair preference over other creditors, by giving security to the creditor, by changing the nature of the creditor's claim or otherwise, is guilty of an offence.
Failure to provide information	982. Every person who, without reasonable cause, refuses or fails to comply with a requirement made under paragraph 643(2)(b) or 957(2)(b) is guilty of an offence.
Use of name	983. (1) Except to the extent permitted by the regulations, every person who uses the name of a bank or of a bank holding company in a prospectus, offering memorandum, takeover bid circular, advertisement for a transaction related to securities or in any other document in connection with a transaction related to securities is guilty of an offence.
Unauthorized use of title ``bank'', etc.	(2) Subject to subsections (4) to (6) and (10) to (12), every entity that acquires, adopts or retains a name that, in any language, includes the word ``bank'', ``banker'' or ``banking'', either alone or in combination with other words, or any word or words of import equivalent thereto, and every person who, in any language, uses the word ``bank'', ``banker'' or ``banking'', either alone or in combination with other words, or any word or words of import equivalent thereto, to indicate or describe a business in Canada or any part of a business in Canada, without being authorized to do so by this Act or any other Act of Parliament, is guilty of an offence.
Unauthorized use of the name of a bank holding company	(3) Subject to subsections (7), (8) and (9), every entity that acquires, adopts or retains, in any language, the name of a bank holding company and every person who, in any language, uses the name of a bank holding company to indicate or describe a business in Canada or any part of a business in Canada, without being authorized to do so by this Act or any other Act of Parliament, is guilty of an offence.
Permitted use	(4) No person commits an offence who uses the word ``bank'', ``banker'' or ``banking''
	(a) in relation to a business that is not engaged in financial activities, unless the business is carried out by a prescribed entity;
	(b) in a description of the corporate relationship of an entity controlled by a bank to that bank or in a description of the corporate relationship of an entity controlled by a bank holding company to that bank holding company;
	(c) in an advertisement in Canada by or on behalf of a foreign bank in respect of its facilities outside Canada;
	(d) in the identification of representative offices of a foreign bank in Canada;
	(e) in relation to the business in Canada of an authorized foreign bank;
	(f) in a description made in accordance with the regulations of the corporate relationship of a bank or a bank holding company with a foreign bank or an entity associated with a foreign bank within the meaning of subsection 507(1) that controls the bank or bank holding company;
	(g) in a description made in accordance with the regulations of the corporate relationship of a prescribed Canadian entity with a foreign bank or an entity associated with a foreign bank within the meaning of subsection 507(1);
	(h) in a description made in accordance with the regulations of the corporate relationship of a prescribed entity associated with a foreign bank within the meaning of subsection 507(1) with the foreign bank or with another prescribed entity;
	(i) in the identification of a body corporate that was a non-bank affiliate of a foreign bank within the meaning of subsection 303(1) of the Bank Act, being chapter B-1 of the Revised Statutes of Canada, 1985, at any time before June 1, 1981;
	(j) in the identification of a Canadian financial institution that
	(i) was controlled by a bank that was a subsidiary of a foreign bank before June 15, 1997 but that has ceased to be so controlled,
	(ii) is controlled by a foreign bank that, before June 15, 1997, controlled the subsidiary, and
	(iii) used, before June 15, 1997, the word ``bank'', ``banker'' or ``banking'' to identify itself; or
	(k) in the identification of a bank holding company.
Permitted use	(5) No subsidiary of a bank commits an offence by reason only that it uses the name of the bank of which it is a subsidiary in its corporate name or a name under which it carries on business or by reason only that it uses any identifying mark, logogram or insignia of that bank in carrying on its business.
Permitted use	(6) No financial institution that was controlled by a bank on June 25, 1999 and that had a name that included the word ``bank'', ``banker'' or ``banking'' on that day commits an offence by reason only that it uses that word in its name or in a name under which it carries on business if the financial institution is a subsidiary of a bank holding company that controls the bank.
Permitted use	(7) No subsidiary of a bank holding company commits an offence by reason only that it uses the name of the bank holding company in the subsidiary's corporate name or in a name under which it carries on business, so long as, if the subsidiary is not a bank or a subsidiary of the bank, it does not use the word ``bank'', ``banker'' or banking'' in its corporate name or in a name under which it carries on business.
Permitted use	(8) No subsidiary of a bank holding company commits an offence by reason only that it uses any identifying mark, logogram or insignia of the bank holding company in carrying on the subsidiary's business, so long as, if the subsidiary is not a bank or a subsidiary of the bank, it does not use any identifying mark, logogram or insignia that includes the word ``bank'', ``banker'' or banking''.
Permitted use	(9) No subsidiary of a bank holding company commits an offence by reason only that it uses the name of the bank holding company in a description of its corporate relationship to the bank holding company.
Permitted use	(10) No Canadian entity that is an entity associated with a foreign bank within the meaning of subsection 507(1) commits an offence by reason only that it uses
	(a) the name of the foreign bank or any identifying mark, logogram or insignia of the foreign bank, or
	(a) the name of another entity associated with a foreign bank within the meaning of subsection 507(1) or any identifying mark, logogram or insignia of that entity,
	so long as it does not use, in any language, the word ``bank'', ``banker'' or ``banking''.
Permitted use	(11) Subject to subsection (12), no foreign bank that carries on a business or activity referred to in subsection 513(2) or section 515.2, 517.1 or 518.1 and no entity incorporated or formed by or under the laws of a country other than Canada that carries on a business or activity referred to in any of those provisions and that is an entity associated with a foreign bank within the meaning of subsection 507(1) commits an offence by reason only that it uses
	(a) its name or any of its identifying marks, logograms or insignia, or
	(a) the name of an entity associated with a foreign bank within the meaning of subsection 507(1) or any identifying mark, logogram or insignia of that entity,
	so long as it does not use, in any language, the word ``bank'', ``banker'' or ``banking''.
Permitted use	(12) A foreign bank referred to in subsection (11) may use the word ``bank'', ``banker'' or ``banking'' in prescribed circumstances if it does so in accordance with prescribed terms and conditions.
Deemed use of ``bank'', etc.	(13) For the purposes of this section, the following are deemed to be a use of the word ``bank'', ``banker'' or ``banking``:
	(a) any statement that a business, other than a bank that is a subsidiary of a foreign bank or the business in Canada of an authorized foreign bank, is connected, associated or affiliated with a bank or a foreign bank; and
	(b) the use of any identifying mark, logogram, insignia or name of a bank or a foreign bank or a name substantially similar to any such name.
Deeming	(14) For the purposes of Part, the use of the name of a bank holding company is deemed to include the use of any identifying mark, logogram, insignia or name of the bank holding company or a name substantially similar to any such name.
Regulations	(15) The Governor in Council may make regulations for the purposes of paragraph (4)(a), (f), (g) or (h).
Making false statements	984. (1) Every person is guilty of an offence who wilfully makes a false statement
	(a) in a warehouse receipt or bill of lading given to a bank or authorized foreign bank under the authority of this Act; or
	(b) in a document giving or purporting to give security on property to a bank under section 426 or 427 or to an authorized foreign bank under either of those sections as incorporated by section 555.
Wilfully disposing of or withholding goods covered by security	(2) Every person is guilty of an offence who, having possession or control of property mentioned in or covered by a warehouse receipt, bill of lading or any security given to a bank under section 426 or 427 or to an authorized foreign bank under either of those sections as incorporated by section 555, and having knowledge of the receipt, bill of lading or security, without the consent of the bank or authorized foreign bank in writing before the loan, advance, debt or liability secured by it has been fully paid
	(a) wilfully alienates or parts with any of the property; or
	(b) wilfully withholds from the bank or authorized foreign bank possession of any of the property if demand for its possession is made by the bank or authorized foreign bank after failure to pay the loan, advance, debt or liability.
Non- compliance with requirements for sale	(3) If a debt or liability to a bank or authorized foreign bank is secured by a warehouse receipt or bill of lading or security on property given to a bank under section 426 or 427 or to an authorized foreign bank under either of those sections as incorporated by section 555 and is not paid, the bank or authorized foreign bank is guilty of an offence if it sells the property covered by the warehouse receipt, bill of lading or security under the power of sale conferred on it by this Act without complying with the provisions of this Act applicable to the exercise of the power of sale.
Acquisition of warehouse receipts, bills of lading, etc.	(4) Every bank or authorized foreign bank that acquires or holds a warehouse receipt or bill of lading or a document signed and delivered to it giving or purporting to give to the bank security on property under section 426 or 427, or to give the authorized foreign bank security or property under either of those sections as incorporated by section 555, to secure the payment of any debt, liability, loan or advance, is guilty of an offence unless
	(a) the debt, liability, loan or advance is contracted or made at the time of the acquisition by the bank or authorized foreign bank of the warehouse receipt, bill of lading or document;
	(b) the debt, liability, loan or advance was contracted or made on the written promise or agreement that the warehouse receipt, bill of lading or security would be given to the bank or authorized foreign bank; or
	(c) the acquisition or holding by the bank or authorized foreign bank of the warehouse receipt, bill of lading or security is otherwise authorized by an Act of Parliament.
Definitions	(5) For the purposes of this section, the expressions ``warehouse receipt'' and ``bill of lading'' have the meaning assigned to those expressions by section 425.
Punishment	985. (1) Every person who is guilty of an offence under any of sections 980 to 984 is
	(a) in the case of a natural person, liable
	(i) on summary conviction, to a fine of not more than $100,000 or to imprisonment for a term of not more than twelve months, or to both, or
	(ii) on conviction on indictment, to a fine of not more than $500,000 or to imprisonment for a term of not more than five years, or to both; and
	(b) in the case of an entity, liable
	(i) on summary conviction, to a fine of not more than $500,000, or
	(ii) on conviction on indictment, to a fine of not more than $5,000,000.
Order to comply	(2) If a person has been convicted of an offence under this Act, the court may, in addition to any punishment it may otherwise impose, order the person to comply with the provisions of this Act or the regulations in respect of which the person was convicted.
Additional fine	(3) If a person has been convicted of an offence under this Act, the court may, if it is satisfied that as a result of the commission of the offence the convicted person acquired any monetary benefits or that monetary benefits accrued to the convicted person or to the spouse or other dependant of the convicted person, order the convicted person to pay, notwithstanding the maximum amount of any fine that may otherwise be imposed under this Act, an additional fine in an amount equal to the court's estimation of the amount of those monetary benefits.
Liability of officers, directors, etc.	986. If an entity commits an offence under this Act, any officer, director, agent or principal officer 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 985 (1)(a) for the offence, whether or not the entity has been prosecuted or convicted.
Limitation period	987. (1) Proceedings by way of summary conviction in respect of an offence under a provision of this Act may be commenced at any time within, but not later than, two years after the day on which the subject-matter of the proceedings became known, in the case of an offence under a consumer provision, to the Commissioner and, in any other case, to the Superintendent.

Bill C-38

Appeals

Regulations

Delegation

PART XVII

SANCTIONS