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Bill S-5

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R.S., c. 18 (3rd Supp.), Part I

Office of the Superintendent of Financial Institutions Act

212. The Office of the Superintendent of Financial Institutions Act is amended by adding the following after section 39:

IMMUNITIES

Not compellable

39.1 The Superintendent, any Deputy Superintendent, any officer or employee of the Office or any person acting under the direction of the Superintendent, is not a compellable witness in any civil proceedings in respect of any matter coming to their knowledge as a result of exercising any of their powers or performing any of their duties or functions under this Act or the Acts listed in the schedule.

1996, c. 6, Sch.

Payment Clearing and Settlement Act

213. (1) The portion of section 2 of the English version of the Payment Clearing and Settlement Act before the definition “Bank” is replaced by the following:

Definitions

2. The following definitions apply in this Act.

(2) The definition “clearing and settlement system” in section 2 of the Act is replaced by the following:

“clearing and settlement system”
« système de compensation et de règlement »

“clearing and settlement system” means a system or arrangement for the clearing or settlement of payment obligations or payment messages in which

(a) there are at least three participants, at least one of which is a Canadian participant and at least one of which has its head office in a jurisdiction other than the jurisdiction where the head office of the clearing house is located;

(b) clearing or settlement is all or partly in Canadian dollars; and

(c) the payment obligations that arise from clearing within the system or arrangement are ultimately settled through adjustments to the account or accounts of one or more of the participants at the Bank.

For greater certainty, it includes a system or arrangement for the clearing or settlement of securities transactions, derivatives contracts, foreign exchange transactions or other transactions where the system or arrangement also clears or settles payment obligations arising from those transactions.

(3) Section 2 of the Act is amended by adding the following in alphabetical order:

“Canadian participant”
« participant canadien »

“Canadian participant” means a participant that is incorporated or formed under an enactment of Canada or a province.

214. Section 15 of the Act is replaced by the following:

Compliance orders

15. If a clearing house or a participant fails to comply with a provision of this Act, with a directive issued to it by the Governor of the Bank in connection with any matter under this Act or with an agreement that it has entered into under section 5, or if a person to whom a request referred to in subsection 14(1) is directed fails to comply with the request, the Bank or the Governor may apply to a superior court for an order directing the clearing house, participant or person, as the case may be, to comply with the provision, directive, agreement or request and, on the application, the court may so order and make any further order it thinks fit.

215. (1) Paragraph 18(2)(a) of the Act is replaced by the following:

(a) to any government agency or regulatory body, charged with the regulation of

(i) financial institutions, as defined in section 2 of the Trust and Loan Companies Act, for purposes related to that regulation, or

(ii) entities that provide clearing or settlement services in connection with securities transactions or eligible financial contracts, for purposes related to that regulation, and

(2) Section 18 of the Act is amended by adding the following after subsection (2):

Disclosure permitted

(3) Nothing in subsection (1) prevents the Bank from disclosing any information or documents pertaining to a clearing and settlement system that the Bank has designated under subsection 4(1) to any government agency or regulatory body charged with the regulation of systems or arrangements for the clearing or settlement of payment obligations or payment messages, for purposes related to that regulation, if the Bank is satisfied that the information or documents will be treated as confidential by the agency or body to whom they are disclosed.

216. Subsection 22(3) of the Act is repealed.

2001, c. 9

Financial Consumer Agency of Canada Act

2009, c. 2, s. 280

217. (1) Paragraph (a) of the definition “consumer provision” in section 2 of the Financial Consumer Agency of Canada Act is replaced by the following:

(a) paragraphs 157(2)(e) and (f), section 413.1, subsection 418.1(3), sections 439.1 to 459.5, subsections 540(2) and (3) and 545(4) and (5), paragraphs 545(6)(b) and (c), subsection 552(3) and sections 559 to 576.3 of the Bank Act together with any regulations made under or for the purposes of those provisions;

(2) Paragraph (a) of the definition “consumer provision” in section 2 of the Act is replaced by the following:

(a) paragraphs 157(2)(e) and (f), sections 273.1 and 413.1, subsection 418.1(3), sections 439.1 to 459.5, subsections 540(2) and (3) and 545(4) and (5), paragraphs 545(6)(b) and (c), subsection 552(3) and sections 559 to 576.2 of the Bank Act together with any regulations made under or for the purposes of those provisions;

(3) The definition “consumer provision” in section 2 of the Act is amended by adding the following after paragraph (a):

(a.1) sections 992 to 1003 of the Bank Act as those sections apply to any notice, document or other information that is required under the provisions referred to in paragraph (a);

(4) The definition “consumer provision” in section 2 of the Act is amended by adding the following after paragraph (b):

(b.1) sections 487.01 to 487.12 of the Cooperative Credit Associations Act as those sections apply to any notice, document or other information that is required under the provisions referred to in paragraph (b);

(5) The definition “consumer provision” in section 2 of the Act is amended by adding the following after paragraph (c):

(c.1) sections 1034 to 1045 of the Insurance Companies Act as those sections apply to any notice, document or other information that is required under the provisions referred to in paragraph (c);

(6) The definition “consumer provision” in section 2 of the Act is amended by striking out “and” at the end of paragraph (d) and by adding the following after that paragraph:

(d.1) sections 539.01 to 539.12 of the Trust and Loan Companies Act as those sections apply to any notice, document or other information that is required under the provisions referred to in paragraph (d); and

2010, c. 12, s. 1854

218. (1) Subsection 17(1) of the French version of the Act is replaced by the following:

Caractère confidentiel des renseignements

17. (1) Sous réserve du paragraphe (2) et sauf disposition contraire prévue par la présente loi, sont confidentiels et doivent être traités comme tels les renseignements concernant les activités d’affaires et les affaires internes d’une institution financière ou concernant une personne faisant affaire avec elle — ainsi que les renseignements qui sont tirés de ceux-ci —, obtenus par le commissaire ou par toute autre personne exécutant ses directives, dans le cadre de l’exercice des attributions visées aux paragraphes 5(1) et (2) et 5.1(2).

2010, c. 12, s. 1841

(2) Subsection 17(3) of the French version of the Act is replaced by the following:

Caractère confidentiel des renseignements — exploitants de réseaux de cartes de paiement

(3) Sous réserve du paragraphe (4) et sauf disposition contraire prévue par la présente loi, sont confidentiels et doivent être traités comme tels les renseignements concernant les activités d’affaires et les affaires internes d’un exploitant de réseau de cartes de paiement ou concernant une personne faisant affaire avec lui — ainsi que les renseignements qui sont tirés de ceux-ci —, obtenus par le commissaire ou par toute autre personne exécutant ses directives, dans le cadre de l’exercice des attributions visées aux paragraphes 5(1.1) et (2.1).

2010, c. 12, s. 1843(2)

219. Subsection 19(2) of the Act is replaced by the following:

Maximum penalties

(2) The maximum penalty for a violation is $50,000 in the case of a violation that is committed by a natural person, and $500,000 in the case of a violation that is committed by a financial institution or a payment card network operator.

220. The Act is amended by adding the following after section 33:

IMMUNITIES

Not compellable

33.1 The Commissioner, any Deputy Commissioner, any officer or employee of the Agency or any person acting under the direction of the Commissioner, is not a compellable witness in any civil proceedings in respect of any matter coming to their knowledge as a result of exercising any of their powers or performing any of their duties or functions under this Act or the Acts listed in Schedule 1.

2010, c. 12, s. 1857

221. Schedule 1 to the Act is amended by replacing the references after the heading “SCHEDULE 1” with the following:

(Subsections 3(2), 5(1) and 19(1) and sections 20 and 33.1)

PART 6

COORDINATING AMENDMENTS AND COMING INTO FORCE

Coordinating Amendments

Subsections 217(1) and (2)

222. On the first day on which both subsections 217(1) and (2) are in force, paragraph (a) of the definition “consumer provision” in section 2 of the Financial Consumer Agency of Canada Act is replaced by the following:

(a) paragraphs 157(2)(e) and (f), sections 273.1 and 413.1, subsection 418.1(3), sections 439.1 to 459.5, subsections 540(2) and (3) and 545(4) and (5), paragraphs 545(6)(b) and (c), subsection 552(3) and sections 559 to 576.3 of the Bank Act together with any regulations made under or for the purposes of those provisions;

2010, c. 12

223. (1) In this section, “other Act” means the Jobs and Economic Growth Act.

(2) On the first day on which both subsection 1894(8) of the other Act and this section are in force, the definition “member” in section 2 of the Bank Act is replaced by the following:

“member”
« membre »

“member”, in relation to a federal credit union, means a person who is one of the members of the federal credit union in accordance with subsection 47.04(2);

(3) On the first day on which both subsection 1950(3) of the other Act and section 5 of this Act are in force, subsection 138(1.1) of the Bank Act is replaced by the following:

Number of eligible votes

(1.1) A bank with equity of twelve billion dollars or more that is not a federal credit union must set out in the notice of a meeting the number of eligible votes, as defined under subsection 156.09(1), that may be cast at the meeting as of the record date for determining shareholders entitled to receive the notice of meeting or, if there are to be separate votes of shareholders at the meeting, the number of eligible votes, as defined in that subsection, in respect of each separate vote to be held at the meeting.

(4) On the first day on which both section 1995 of the other Act and this section are in force, paragraph 216.14(1)(d) of the Bank Act is replaced by the following:

(d) respecting, for the purposes of a proposal to become a bank with common shares, the value of the converting federal credit union and of its membership shares and shares, if any, and authorizing the Superintendent to specify a day as of which those values must be estimated;

(5) If section 2057 of the other Act comes into force before section 17 of this Act, then that section 17 is replaced by the following:

17. Subsection 376.1(1) of the Act is replaced by the following:

Prohibition against significant interest

376.1 (1) No person who has a significant interest in any class of shares of a widely held bank with equity of twelve billion dollars or more may have a significant interest in any class of shares of a subsidiary of the widely held bank that is a bank or a bank holding company.

(6) If section 2057 of the other Act comes into force on the same day as section 17 of this Act, then that section 17 is deemed to have come into force before that section 2057.

(7) If section 2058 of the other Act comes into force before section 18 of this Act, then that section 18 is replaced by the following:

18. Subsection 376.2(1) of the Act is replaced by the following:

Prohibition against significant interest

376.2 (1) No person who has a significant interest in any class of shares of a bank may have a significant interest in any class of shares of any widely held bank with equity of twelve billion dollars or more, or of any widely held bank holding company with equity of twelve billion dollars or more, that controls the bank.

(8) If section 2058 of the other Act comes into force on the same day as section 18 of this Act, then that section 18 is deemed to have come into force before that section 2058.

(9) If section 2060 of the other Act comes into force before section 20 of this Act, then, on the day on which that section 20 comes into force, section 377.1 of the Bank Act is amended by adding the following after subsection (1):

Exception — federal credit union

(1.1) Subsection (1) does not apply in respect of a person who acquires control of a federal credit union.

(10) If section 2060 of the other Act comes into force on the same day as section 20 of this Act, then that section 20 is deemed to have come into force before that section 2060.

(11) If section 2062 of the other Act comes into force before section 22 of this Act, then that section 22 is replaced by the following:

22. Subsection 380(1) of the Act is replaced by the following:

Exemption

380. (1) On application by a bank, other than a bank with equity of twelve billion dollars or more, the Superintendent may exempt any class of non-voting shares of the bank the aggregate book value of which is not more than 30 per cent of the aggregate book value of all the outstanding shares of the bank from the application of sections 373 and 379.

(12) If section 22 of this Act comes into force before section 2062 of the other Act, then, on the day on which that section 2062 comes into force, subsection 380(1) of the Bank Act is replaced by the following:

Exemption

(13) If section 2062 of the other Act comes into force on the same day as section 22 of this Act, then that section 22 is deemed to have come into force before that section 2062 and subsection (12) applies as a consequence.

(14) On the first day on which both subsection 2069(2) of the other Act and section 31 of this Act are in force, paragraph 396(2)(a) of the Bank Act is replaced by the following:

(a) more than 10 per cent but no more than 20 per cent of any class of the outstanding voting shares of a widely held bank with equity of twelve billion dollars or more that is not a federal credit union; or

(15) On the first day on which both subsection 2071(2) of the other Act and section 32 of this Act are in force, subsection 401.2(2) of the Bank Act is replaced by the following:

Exception

(2) Despite subsection (1), a bank may record in its securities register or members register a transfer or issue of any share or membership share of the bank to a foreign bank, or to a foreign institution, that is controlled by the government of a foreign country or any political subdivision of a foreign country, or by any agent or agency of a foreign government, if the share or membership share that is transferred or issued is beneficially owned by the foreign bank or foreign institution or by an entity controlled by the foreign bank or foreign institution.

(16) If section 2072 of the other Act comes into force before section 33 of this Act, then that section 33 is replaced by the following:

33. Subsection 401.3(3) of the Act is replaced by the following:

Exception

(3) Subsections (1) and (2) do not apply to a foreign bank, or to a foreign institution, that is controlled by the government of a foreign country or any political subdivision of a foreign country, or by any agent or agency of a foreign government, if the share referred to in subsection (1), or, in the case of a federal credit union, a membership share, is beneficially owned by the foreign bank or foreign institution or by an entity controlled by the foreign bank or foreign institution.

(17) If section 33 of this Act comes into force before section 2072 of the other Act, then, on the day on which that section 2072 comes into force, subsection 401.3(3) of the Bank Act is replaced by the following:

Exception

(18) If section 2072 of the other Act comes into force on the same day as section 33 of this Act, then that section 33 is deemed to have come into force before that section 2072 and subsection (17) applies as a consequence.

(19) On the first day on which both section 2079 of the other Act and this section are in force,

(a) subparagraph 487(2)(a)(i) of the Bank Act is replaced by the following:

(i) in accordance with any provisions for the conversion of other issued and outstanding membership shares or securities of the bank into shares of that class of shares, or into membership shares,

(b) subparagraph 487(2)(a)(iv) of the Bank Act is replaced by the following:

(iv) in accordance with the terms of an amalgamation or conversion under Part VI,

(20) If section 2104 of the other Act comes into force before section 203 of this Act, then, on the day on which that section 203 comes into force, subsection 45.2(1) of the Canada Deposit Insurance Corporation Act is replaced by the following:

Confidentiality

45.2 (1) All information regarding the affairs of a federal institution, provincial institution or local cooperative credit society, or of any person dealing with one, that is obtained or produced by or for the Corporation is confidential and shall be treated accordingly.

(21) If section 203 of this Act comes into force before section 2104 of the other Act, then, on the day on which that section 2104 comes into force, section 45.2 of the Canada Deposit Insurance Corporation Act is replaced by the following:

Confidentiality

Information from the Superintendent

(2) The Corporation may, if it is satisfied that the information will be treated as confidential by the recipient and after consultation with the Superintendent, disclose any information obtained from the Superintendent regarding the affairs of a federal member institution

(a) to any government agency or body that regulates or supervises financial institutions, for purposes related to that regulation or supervision;

(b) to any other agency or body that regulates or supervises financial institutions, for purposes related to that regulation or supervision; or

(22) If section 2104 of the other Act comes into force on the same day as section 203 of this Act, then that section 2104 is deemed to have come into force before that section 203 and subsection (20) applies as a consequence.

2010, c. 25

224. (1) In this section, “other Act” means the Sustaining Canada’s Economic Recovery Act.

(2) If section 52 of this Act comes into force before section 149 of the other Act, then that section 149 is repealed.

(3) If section 149 of the other Act comes into force on the same day as section 52 of this Act, then that section 149 is deemed to have come into force before that section 52.

(4) On the first day on which both section 160 of the other Act and section 218 of this Act are in force, subsection 17(1) of the French version of the Financial Consumer Agency of Canada Act is replaced by the following:

Caractère confidentiel des renseignements

17. (1) Sous réserve du paragraphe (2) et sauf disposition contraire prévue par la présente loi, sont confidentiels et doivent être traités comme tels les renseignements concernant les activités d’affaires et les affaires internes d’une institution financière ou d’un organisme externe de traitement des plaintes ou concernant toute personne faisant affaire avec eux — ainsi que les renseignements qui sont tirés de ceux-ci —, obtenus par le commissaire ou par toute autre personne exécutant ses directives, dans le cadre de l’exercice des attributions visées aux paragraphes 5(1) et (2) et 5.1(2).

Coming into Force

Order in council

225. (1) Subject to subsection (2), the provisions of this Act, except sections 3, 77, 105, 123, 154, 163 and 222 to 224, come into force on a day or days to be fixed by order of the Governor in Council.

Order in council

(2) Sections 9 to 11 and 207 and subsection 217(2) come into force on a day or days to be fixed by order of the Governor in Council, which may not be earlier than the day on which subsection 1894(8) of the Jobs and Economic Growth Act, chapter 12 of the Statutes of Canada, 2010, comes into force.

Published under authority of the Senate of Canada

Available from:
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Explanatory Notes

Office of the Superintendent of Financial Insitutions Act

Clause 212: New.

Payment Clearing and Settlement Act

Clause 213: (1) Relevant portion of section 2:

2. In this Act,

(2) Existing text of the definition:

“clearing and settlement system” means a system or arrangement for the clearing or settlement of payment obligations or payment messages in which

(a) there are at least three participants, at least one of which is a bank,

(b) clearing or settlement is all or partly in Canadian dollars, and

and, for greater certainty, includes a system or arrangement for the clearing or settlement of securities transactions, foreign exchange transactions or other transactions where the system or arrangement also clears or settles payment obligations arising from those transactions;

(3) New.

Clause 214: Existing text of section 15:

15. If a clearing house or a participant fails to comply with a provision of this Act or a directive issued to it by the Governor of the Bank in connection with any matter under this Act, or a person to whom a request referred to in subsection 14(1) is directed fails to comply with the request, the Bank or the Governor may apply to a superior court for an order directing the clearing house, participant or person, as the case may be, to comply with the provision, directive or request and, on the application, the court may so order and make any further order it thinks fit.

Clause 215: (1) Relevant portion of subsection 18(2):

(2) Nothing in subsection (1) prevents the Bank from disclosing any information or documents

(a) to any government agency or regulatory body charged with the regulation of financial institutions, within the meaning of section 2 of the Trust and Loan Companies Act, for purposes related to that regulation, and

(2) New.

Clause 216: Existing text of subsection 22(3):

(3) In subsection (1), a participant is “Canadian” if the participant is incorporated or formed under an enactment of Canada or a province.

Financial Consumer Agency of Canada Act

Clause 217: (1) to (6) Relevant portion of the definition:

“consumer provision” means

(a) paragraphs 157(2)(e) and (f), section 413.1, subsection 418.1(3), sections 439.1 to 459.5, subsections 540(2) and (3) and 545(4) and (5), paragraphs 545(6)(b) and (c), subsection 552(3) and sections 559 to 576.2 of the Bank Act together with any regulations made under or for the purposes of those provisions;

Clause 218: (1) Existing text of subsection 17(1):

17. (1) Subject to subsection (2) and except as otherwise provided in this Act, information regarding the business or affairs of a financial institution or regarding persons dealing with one that is obtained by the Commissioner or by any person acting under the direction of the Commissioner, in the course of the exercise or performance of powers, duties and functions referred to in subsections 5(1) and (2) and 5.1(2) and any information prepared from that information, is confidential and shall be treated accordingly.

(2) Existing text of subsection 17(3):

(3) Subject to subsection (4) and except as otherwise provided in this Act, information regarding the business or affairs of a payment card network operator, or regarding persons dealing with one, that is obtained by the Commissioner or by a person acting under the direction of the Commissioner, in the course of the exercise or performance of powers, duties and functions under subsection 5(1.1) or (2.1), and any information prepared from that information, is confidential and shall be treated accordingly.

Clause 219: Existing text of subsection 19(2):

(2) The maximum penalty for a violation is $50,000 in the case of a violation that is committed by a natural person, and $200,000 in the case of a violation that is committed by a financial institution or a payment card network operator.

Clause 220: New.